 Now at the time Cabela's was a relatively healthy company. It was posting nearly two billion dollars a year in gross profits It was well. Why was a stock price 50% lower? Because it was at real risk Because of the changing Retail industry because of online businesses again the stock market does not reflect your performance today The stock price reflects your expected performance in the future Tucker you need a 101 finance class, and I have just the professor for you me So anytime I'm available to teach you just a little bit of finance because it would be helpful given that you're commenting on stuff in Finance I got my PhD in this. I know this stuff. All right Tucker's not listening Maybe one of his producers would maybe you could forward this link to one of Tucker's producers Of four billion. That's America thrift stores and methadone clinics. That's America community after community Desiccated empty husks with nothing left huge swaths the United States look like that now. I Mean none of that would stand up to any kind of statistic and none of that is true and of course Ever been to ghost town ever been to ghost town You know like in the 19th century where they mine for gold or mine for copper mine for something and then a copper ran out And everybody left and moved on I mean if you drive along roots was it root 69 root 66 The route that goes kind of from the Midwest all the way to California before the highway systems you drive through lots of ghost towns Industry shut down, but the people didn't die Americans don't shrivel up and die when a factory closes Americans get up off their butt climb on to the horse and ride Ride to where the jobs are Today, it's a lot easier today. You can get into your automobile You can take a plane you can ride in a train and go to where the jobs are if America is the way Tucker Carson is describing it it's because Some Americans are not willing to take responsibility for their own lives because people like Tucker Carson have told them They should not and instead they sit around wait around For stuff to happen to them That's not America. That's not what the American spirit is Create your own destiny. That's what America is about It only gets worse from here guys So what happened well a lot of things happen some of them are complicated and hard to change But one of the big factors in this slow-moving disaster is the utter Transformation of the way our leaders think about the American economy So it's other transformation of the way our leaders think about the American economy and what is that transformation? It used to be that our leaders cared about the people and now They're ruthlessly capitalist He doesn't say that but that's exactly what he means During the last gilded age 125 years ago America's ruling class may have been ostentatiously rich and they were go to Newport, Rhode Island for proof if you like But it was still a recognizably American class Tycoons accumulated fortunes, but they also felt some obligation to the country around them So accumulating fortunes is not enough. This is typical left this point Accumulating fortune doesn't count which matters is what you give back and in the 19th century Tucker's gonna say the tycoons gave back They were real Americans Today the tycoons are here it is He doesn't say it but what he means is globalist. They don't care about America. So they don't give back And that's the problem really Ben and I would rip Tucker Carlson to anybody in a real debate Tucker Carlson does it have a chance. He knows absolutely nothing about Economics about the economy about America about how jobs are created About what's really going on in this country. He has a mouthpiece. He's a propaganda mouthpiece And by the way for those of you who wonder I've debated dozens of people. I've done dozens of debates So steel kite tycoon Andrew Carnegie famously built stone libraries around the country. Yeah, that's what makes him good He built libraries rather than He actually reshaped the steel industry in this country created millions and millions of jobs. I Mean thousands and thousands of jobs and created built this country by building its industry That's what makes Carnegie special. Not the libraries libraries are nice Edification of people beneath him John D. Rockefeller and many others so-called Robert Barons set aside huge portions of their wealth And in some cases their property to make this country better. That's what makes them good guys This is this is the complete and utter bankruptcy of conservatives That they think for a minute They think for a minute that what makes the so-called Robert Barons good guys And and the idea that You know, they didn't shut down factories. They didn't shut down towns they didn't Now they were the good guys they only created jobs and they were socially responsible. He sounds like Bernie Sanders in the old days The rubber Barons were socially responsible. The problem today is they're not socially responsible enough Hey All right Stone Acadia National Park, etc. Oh, yeah, we got most significantly in January of 1914 Henry Ford more than doubled the prevailing factory wage to a then remarkable five dollars for an eight-hour day Ford didn't have to do that, but his company was succeeding and he thought he should really. Oh my god I mean, this is the kind of fake history not just fake news Tucker Carlson engages in but fake history that he is providing us Why did Ford double wages to five dollars a day in 1914 What was he trying to do was he try was he was he thinking? I mean, I don't know if you've read a little bit about Ford But it was for thinking oh, we're doing well. So we should share some of our prosperity with our workers Is that what he was doing? No What Ford actually did was raise wages to five dollars an hour fire his most unproductive workers and Attracted to himself because he doubled wages the best most productive workers in the entire auto industry what he did was Raise wages so he could make more money what he did is raise wages so you can attract the best most productive people In an incredibly competitive market in an incredibly competitive market for labor what Ford did Was maintain his best people Attract the best people and fired the people who couldn't live up to five dollars an hour a day Sorry five dollars a day So it's just nuttiness To present. Oh, the robber barons weren't robber barons really they were good guys because they did philanthropy And they paid their weight work as well I mean if you've read how Carnegie and many of these guys treated their workers Some of it is embarrassing to defend of capitalism like me. I Mean they bought out of Pinkerton sometimes to shoot them and yet he's whitewashing that In order to make his point about how wonderful they were because today's Industrialist today's financiers a She evil sheer evil. Why at the end of the day the reason is Because they don't support Donald Trump Some historians trace the creation of the American no-class to that decision Either way, it is nearly impossible to imagine a big company doing anything like that today Attitudes are just too different. Really. No big company today would raise wages Amazon did not raise wages to $15 an hour minimum wage. They did They raised them for all workers $15 minimum wage at Amazon. They did that recently Walmart has done it other companies in technology. It's done all the time the idea that somehow Today because they're focused on let Tucker Carlson tell you which finance mogul looks at workers Merely is cost to be reduced or eliminated entirely Which is funny When you think about what some of the what some of the great industrialists of the 19th century did and how they treated workers today corporations these businesses today's financiers today's capitalists Far more far more worker friendly Far more worker friendly Than they were in the 19th century. I mean it's such a joke. It is such a joke But it's not a joke. This is purposeful lying purposeful Deception purposeful Misrepresentation of the truth. This is worse as bad as the New York Times at its worst He isn't building a lot of public libraries these days instead the model really all those philanthropists are not building anything They're not contributing. I mean American Billionaires don't contribute anything. Where do you live Tucker? Which America? I mean you you are spending too much time in New York, I think but if you go by the way if you go in New York to the I don't know to the Ballet now ballet, you know highfalutin stuff, but it's it's the ballet who built that ballet Well, it's got a big sign on the front of the ballet. I love it because all those New York leftists They have to pass They have to pass through this and see this but right on the New York ballet. It says in big type Donated by David Coke From the coke brothers all those leftists have to go and see the ballet Knowing that it is made possible From a donation by David Coke the man they hate more than anything else Hey, Tucker, you don't live in America. You have no clue what America is like Ruthless economic efficiency by a distressed company outsorts the jobs liquidate the valuable assets fire-middle management And once the smoke is cleared dump what remains to the highest bidder off and there's something wrong with all of that That he just described that's called creative destruction. That's called economic progress. That's called re-assigning capital to its more productive use that's called job creation. That's called job creation because by Dismantling capital that's inefficient by dismantling and destroying jobs. They do not produce one frees up the capital to create jobs elsewhere and That's why there are more jobs today than ever before. That's why unemployment is so low today in America now because of Trump or or or Tech of Carlson, but because capitalists are deploying capital more and more and more efficiently and that's why there were jobs in the 80s as The rest of the belt was shutting down jobs disappearing going away Exactly the process. He just described All of that happening and at the same time jobs appeared elsewhere many many more jobs because unemployment was declining throughout By the way, anybody really interested in Understanding what I'm going to be talking about today and understanding why the fallacy the complete and utter garbage that is Everything that Tucker is is just said and is going to say for the rest of the show. There's a movie. I recommend and In the movie depicts exactly this restructuring of America and the movie actually represents What is really going on? amazingly effectively It's a little funny Can't be a little vulgar here and there and it hero the hero of the movie purposefully is Played purposefully in the sense that they put the guy if they put this actor there on purpose to make you want to ridicule it Now now Wall Street Wall Street is the opposite Wall Street depicts the opposite Wall Street is a complete misunderstanding of what this process is The movie is other people's money One of the maybe the best movie ever made about finance It is a great movie About finance not qua movie. I don't know if it's great, but qua finance It's a great movie. This speech is there brilliant Danny DeVito's character is brilliant And of course the bad guy in the movie is Gregory Peck so the good guy is DeVito the bad guy is Gregory Peck the bad guy who represents tucker Carlson The good guy is me represents me my arguments about finance and If you see that movie you see why sometimes Businesses have to be shut down workers have to be fired assets need to be sold to the highest bidder and Why the existence of financiers that can do this the existence of financiers That engage in this kind of activity is essential crucial to a thriving economy essential crucial to capitalism all right Let's keep going with tucker. We're only two minutes in this still eight minutes eight minutes of lying in misrepresentation Asia it's happened around the country. It has made a small number of people phenomenally rich Yeah, good one of them is a New York based hedge fund manager called Paul singer Paul singer is a massive contributor to the Republican Party and I Think from what I read a never Trumpa That is his real sin According to Forbes has amassed a personal fortune of more than three billion dollars. How was singer made that money? We made a lot of it by purchasing sovereign debt from financially distressed countries countries that were in trouble Usually at a massive discount once a country's economy were gained some stability Singer would bombard us government with lawsuits from a massive public relations campaign originating here in Washington sometimes Until he made his money back with interest the practice is called vulture capitalism now notice That he's saying all this with a smoke and is horrible He buys the stress debts of countries that get into trouble somehow they get into trouble What Paul singer is known for doing Particularly famous for the Argentinian debt is buying debt of countries that have collapsed economically and buying them for pennies on a dollar Because they become socialist countries and the economy's collapsed and they won't pay or The market fear they won't pay and what Peter singer does is He Forces them to pay. He uses the legal system. He uses the courts not thugs not gangsters the courts the rule of law to force countries That take on too much debt and then can't pay it Forced them Through means legal means to pay their debts. I mean Peter singer is a hero a hero By forcing countries governments to live up to their obligations But forcing countries governments who are irresponsible to pay the debts that they've accumulated. I Mean Grease needed a Peter singer to go after them I don't think he did it because I don't think the rule of law would have applied in quite the same way in Europe But he did go after Argentina and he made a fortune doing it because while everybody else had given up on Argentina ever paying back its debt Peter singer forced them By using American courts by freezing Argentinian assets in America to pay the debts that they took on But TECA Carson doesn't see it that way. This is vulture capitalism This is people taking advantage of all those weak countries the weak countries that are borrowed money from people and won't pay it back I mean it really is disgusting. I mean singer is Actually forcing government to live up to their obligations good for him and he's done this in country after country after country and they know now They know that if they Threaten not to pay their debts If they threaten to default on their obligations People like Peter singer and other hedge fund managers hedge fund managers Well enter the market buy up the debt and use legal resources Use the rule of law to go after them and force them to do it indeed in Argentina He was basically responsible for Ultimately The conviction of a president Christina, she's now the vice president. She came back, but she was convicted of fraud Partially related to these bonds Because she took out debt and then refused to pay That's wrong And we should be defending people who call it out as wrong But no the new conservative the nationalist conservative the Donald Trump conservatives of today God forbid We should stand out for an entrepreneur capitalist Never we're gonna go with governments all the way even the corrupt Socialist ones Feeding off the carcass of a dying nation carcass of a dying nation. How disgusting is that? In some ways, it's not so different from what singer and his firm Elliott management have done in this country and to this country Now we get to the past couple of decades Elliott management has been billions by buying large stakes in American companies Then firing workers driving up short-term share prices and in some cases taking government bailouts insult to injury Now, how do you how is it that by firing workers you raise short-term? short-term stock prices Doesn't work that way If you fire workers and by doing so sacrifice a long term Profitability of the country company then stock prices will go down stock prices reflect in a price today The expectations about future profits of the company So if you just firing workers to raise profitability right now at the expense of the future your stock price will go down There are lots of examples in history lots of examples of companies cutting workers and the stock price going down not up Why going down? Because they've sacrificed long-term profits for short-term accounting gain But again Taka doesn't understand how stock markets work. Taka has no concept of how capitalism works so for him If you make money And you've cut shit and you've cut workers. I mean he's a socialist a Leftist at least if not a socialist Bloomberg News once described singer as quote the world's most feared investor. He is he is because When he invests in your company You better be on top of it You better be efficient. You better be productive. You better be in a position to make money Making money is a good thing making money is a sign of Value creation making money is what creates the capital That employs people Ultimately, but it's not about employment Lots of companies shrink to make more money by buying robots for example It's about making money and the more wealthy create the more jobs are created in the economy even if not in your company Again, it's such bogus economics Somebody says conservatives are such boomers What is what it boomers become this amazing insult now? I Don't think Tucker's a boomer. I am I guess I'm at the tail end of the boomer generation Tells you a lot. No one's even pretending Paul singers tactics are good for anyone, but Paul singer not true I'm pretending. Hey Paul singers tactics are good for America the Paul singers of the world or what keep America competitive It's the Paul singers of the world Is what move the world forward? It's what make innovation possible It's what frees up the capital For all the goodies for all the things that makes your life possible Tucker Carlson His fund Consider the case of Delphi the automotive parts supplier During the last financial crisis a consortium of hedge funds including singers Elliott management purchased Delphi Now notice what he doesn't say Notice what he doesn't say he says you're in the financial crisis 2008 2009 a consortium of hedge funds led by Paul singer purchase Delphi now How did they do that did they buy it stuck on the market, how did they do that while he's missing an important piece here Delphi was bankrupt Delphi was an auto parts maker I'm gonna give you the whole story rather than just the pieces The Tucker Carlson wants to give you because that's what I do I kind of try to be objective try to give you facts Rather than fake false biased partial news Delphi was an auto parts manufacturer and until 1999 it was basically a part of GM GM used it to make all the auto parts for its cars in 1999 General Motors spun Delphi out with the idea of one raised capital by selling it into the public it it raised money and Secondly with the idea that Delphi could now Manufacture parts for lots of other car companies and therefore Diversify and maybe become a more profitable and successful company not just dependent on General Motors Well, it didn't work out quite that way One of the things that was spun out with Delphi was the pension plans of the Union and all the Union wages and all the Union problems That have crippled for decades the American auto industry And in 2005 six years after was spun out and well before the financial crisis. I might know Six years after was spun out from General Motors. It filed for bankruptcy bankruptcy In 2008 it was still bankrupt as the financial crisis it and auto sales plummeted and The biggest crisis in American auto industry in history occurred Delphi Was on the verge of liquidation on the verge of selling all its asset Firing all its workers and Shutting down completely the only thing that was keeping it alive What payments from General Motors? Small payments But by 2008 2009 GM couldn't afford to do that. So the company was in bankruptcy At which point Paul Singer bought its debt took over that debt In bankruptcy and in a sense took control over the debt proceedings at that time I'll tell you the rest of the story following Tucker Singer and the other funds at the helm the company took billions of dollars in government bailouts paid I'll get to the government bailout for by you Obama's autos are compared those tactics to extortion But they continued anyway Thomas autos are was the one who gave the bailout now Delphi did not take as far as I can tell did not take a direct payment From the bailout of the auto industry. So here's the story You've got Delphi bankrupt You've got GM paying it a little bit of money, but GM running out of money having no money Pausing and a bunch of hedge funds by its debt for pennies on the dollar just like with those foreign countries the government in 2009 under Obama sets up a If you remember, what was it called? It was like there the save the auto industry committee of government officials actually Obama appointed a former private equity fund manager to run this this entity in Charge of bailing out the auto industry and they came in and they took over basically took over General motors and started managing general motors They created Let me just see I've got I've got part of this history written down here Let's see Yeah, so GM is is on the verge of bankruptcy Delphi is basically on the verge of liquidation. I And you know Bush in 2008 it spent 17.4 billion dollars to rescue GM and Chrysler with loans and then Obama assembled this task force led by a Wall Street Private equity guy by the name of Stephen Ratner To oversee the bailout of the auto industry to poor meant much more money in there, right? At some point in March of 2009 GM was supposed to give 150 million dollars to Delphi based on just keeping it alive and the reason GM wanted to keep Delphi alive It's because the auto parts Without Delphi GM was dead it would have no auto parts so GM was about to make a Payment of 150 million dollars to Delphi and the task force said no so within a few couple of months again, this is on the verge of liquidation a private equity firm by the name of platinum equity a Group that I actually know I know the I know the founders and I've I've been I've been a platinum equity Very very successful private equity firm actually bids to buy the assets So they're gonna buy the assets of Delphi but Nothing here can happen without the Treasury Department without Obama's Commission approving it and in addition Peter Singer and the other hedge funds say wait a minute platinum is buying this company way too cheap way too cheap So they come in and they make a higher offer they bid more money for the company and Basically right they offer to exchange the debt The loans that they have for equity for control over the company and in July 2009 They cut a deal with GM That they will take over the company and will not be sold to platinum Now GM provided financing at this point to this new company that's coming out of bankruptcy Right Delphi comes out of bankruptcy Steered by these hedge funds and GM provides them with financing $1.7 billion of a direct investment in its equity they get shares for the 1.7 Billion dollars now where does GM get 1.7 billion dollars because GM is on the verge of bankruptcy GM gets the 1.7 billion dollars from The 20 billion I think or however much it was how much did they you know from the massive pool of Money that the Treasury gave them So Treasury lends money to GM GM makes an investment with that money in Delphi an investment that they got back With massive returns a few years later when Delphi goes public now Peter Singer in the story is a hero He sales saves Delphi he actually Pays the debt holders more than what they would have got a platinum of taking that over Yes, he gets government subsidized money But the problem is not The hedge funds of Peter Singer the problem is that the government subsidized money was going to GM To bail them out the government should have never bailed them out Anyway, I don't know if now at this point. I'm boring you with all the details But I just want to give you I just a glimpse into the complexity involved here now. It's true The Delphi in order to stay competitive In order to actually become a competitive company and Delphi exists today Delphi is thriving It just split into two companies of auto parts manufacturers Delphi did a few things one It changed its officials place of incorporation to the UK In order to take advantage of lower taxes Second Second It fired a lot of people it moved the assembly of some of the parts to China or to the UK or to other parts of the world Indeed Delphi today has factories assemblies Officers in 24 countries around the world it employs hundred and fifty thousand people of which It's hard to tell that I couldn't quite find the numbers, but about ten thousand in America Maybe more It's headquarters is in the US in Michigan It's the one they still run the company from Michigan even though they pay UK taxes Now Elliot I mean Elliot which is the fund put posting his fund They made a fortune off of this. They made a lot of money Because they bought a cheap and then they ran it. Well, and they took it public And we have an auto parts manufacturer Who's selling parts to GM who helped ultimately GM survive now? Granted GM should have been allowed to go bankrupt and Delphi probably would have gone bankrupt with it But to pull out Paul Singer was subsidized by US bailout is again dishonest partial information Dropping all context Just an attempt to slur and condemn somebody for what? for what? to go after somebody who is funding People who are never trumpers by the way, I get no money from Paul Singer The Iron Man Institute has never gotten any money from Paul Singer although I tried but I never managed to get a meeting with him So I have no love for Paul Singer because he supports me or anything like that I would tell you if he did Because I don't mind being supported by people like Paul Singer. It's just in this case. It's just not true I happen to love what he does. I happen to love The kind of capitalist he is I haven't a love the process that is capitalism not They kind of wishy-washy touchy feely Nationalist socialism of Tucker. I'm talking about capitalism the beauty of change The beauty of people using their minds to figure out solutions to reallocate capital to its most productive use To save companies to destroy companies when they need to be destroyed Watch other people's money Tucker Carlson should watch other people's money He could learn a lot from that movie. Tell me the value of selfishness Use another word self-esteem The value of selfishness is that you esteem yourself as a value that you leave according to your nature Which means by the judgment of your own mind and you respect your own mind Respect your own ability to do the right thing. Therefore you respect the possibility of being a Morally virtuous person and you regard yourself as a value was preserving Let me bring it down from Kant a little bit To a bromide that I had drummed into me as a child and maybe you've heard it Happiness comes from making other people happy. Oh, yes Who hasn't heard it and that's the trouble let's aim at the day when people will not hear it anymore Because it isn't true. It isn't justifiable in the first Question you would have to ask is why? Why is it good to want others to be happy but not yourself? And I suppose you will be told that well, but they will work for your happiness and not their own Well, it's like an exchange of Christmas presents that neither party wants But that you have to exchange presents and you're not allowed morally to do something for yourself Whereas what I say You can make others happy when and if those others mean something to you Selfishly if you love them then you want to make them happy fine if you don't love them That's not a moral crime. You don't have to love everybody. You cannot love everybody because the meaningless expression you can love only those whom you value and If they contribute to your happiness you contribute to theirs, that's fine But each one of you has to be selfish about it Supposing somebody were in love with you and said I love you because you're so bad So I sacrifice myself and I'm going to love you. Would you accept that or no man? No, sir, I wouldn't either that's the most insulting thing anyone could have said to you and yet That's what altruism would demand and there is a great Russian writer who tried to practice it the Staysky Who did marry a poor? Stupid little Simstress who whom he didn't love at all out of the desire to make her happy The end of it was she committed suicide now that is an altruist practice That's what altruism leads to how about it's more blessed to give than to receive well, that's obviously the welfare state. That's a clearly motivated slogan to please Give me something and you'll be blessed But I will keep your your material good using the super chat and I noticed yesterday when I appealed for support for the show many of you step forward and actually Supported the show for the first time. So I'll do it again. Maybe we'll get some more today If you like what you're hearing if you appreciate what I'm doing, then I appreciate your support Those of you who don't yet support the show, please take this opportunity. Go to your own book show calm slash support or go to subscribe star calm your own book show and And and make a kind of a monthly contribution to keep this to keep this going I'm not sure when the next