 So inflation, so we live in interesting times, right? We're living in times that I don't remember how else to them, I lived in parallels to the period 1970, but really for one generation, two generations, maybe inflation is weird, it's a foreign concept, it's never happened, interest rates have been zero or 12 years now, before that they weren't much higher than zero inflation has been a non-economic perspective for a long, long time, in fact, I think incorrectly has been deemed as this amazing entity that has just managed to manage that economy beautifully and everything's gone smoothly and cool. We have the Alan Glitzman and Bernanke and our Janet Yellen and Paul that they've all been doing an amazing job and people are big fans of the Fed as a consequence, I think that's true across the board and there's very few, they have been very few challenges that what the Fed have done a million years. Now, I think a very different perspective, I think the Fed has found hope in slow economic growth, I think the Fed has found hope with the 2018, the other night, the 2008 financial crisis, I think the Fed has done the best job of all of that period and we did not see one manifestation of a bad job that does, which is, in fact, there are lots of things you could screw up that are not manifest in inflation. So really the question of the Fed is we'll talk a little bit about the economics of it and then we'll talk about, well, should there be a Fed? What is the role of government vis-à-vis economics and does that include a monopoly over the issuance of money which is what the Fed has and therefore the ability to control the economy because of the prices and the regulating financial system. So what is inflation? I mean, I think we're all experiencing right now what we call price inflation, prices going up with really no reason to see the report, we can understand like prudent and invasions you've created and the price of oil goes up, that makes sense, all of those, right, because supply is being under strain, demand is still the same, you have the same demand, small supply, whatever, prices, they go up. But that wouldn't cause inflation, that would cause inflation, there's an oil to it. Now, why wouldn't it cause inflation? Because if you have a set amount of money chasing a set amount of goods, the price of one good goes up and if I can afford less of this, what's going to happen to prices elsewhere? I'm spending more money in the oil, then what happens, and I've only got a certain amount of income, then what happens to my consumption of other things? It goes down and therefore that's going to have to be reflected in the prices of all those things. So that's what we've got relative prices, relative prices, they're impacted by supply shocks, by things like war, by embargoes. You can have a relative price movement where the price of oil goes through the roof and we have no inflation. So something else is going on here, people playing supply chain, you remember this was all about supply chains, it was all about the difficulties of getting goods from China, see the United States, but again you have that, I think so, okay, I get why that has been, oh why are all these other prices going, why isn't there again this relative price movement? Okay, I spent less stuff on China, why is there any more money in China because those supplies can strain you, so prices have gone up, but then I should spend less money on the stock and then probably keep it down. So at the end of the day, something else has to go on, but it should be sustained inflation that is prices going up throughout the economy, not just oil, not just stuff in China, but also rents in real estate and I don't know if you still like college textbooks, so all this stuff when we buy seems everything seems we don't. The question is, when does that happen? How does it happen that everything goes up because what we characterize as plain inflation? Again, in measuring inflation, it's tricky, you have to be curious at how people measure inflation, we can talk about it, but the way they, when you want to measure inflation is the popular, excuse me, not the one the Fed looks at, but the one that people see is called CPI, you can start their product, consumer product in a day, and basically what they do is they take a basket of the goods that they think the average consumer consumes, and they figure out how that changes in prices all the time. Now there is no such thing as an average consumer, so every one of us, in a sense, experiences inflation different because our basket of goods is different, so not all the aspects of goods are going up at the same goods. Does that make sense? Perfect. So what we can't, all the inputs go up in price, not just some. Well what kinds of prices or anything can go up? Increase demand. If suddenly we all decide we're moving to need a little talent anyway, and we also want to demand real estate, we want to buy what's going to happen in quite local real estate prices, they can go up. I live in Puerto Rico, and over the last five years, Puerto Rico's experienced that, right? A bunch of Americans have showed up, many of them before the current crisis, many of them were crypto money that is all feeling like they're Italian-esque, and they said, we want to buy the best problems in the island, and guess what happened to the best problems in the island? All of them went through all the prices of real estate just went up. Not low-ended, not medium-ended, because that's not where the demand came from. Demand for high-end, those all went up. So suddenly people demand, not just real estate, but they demand everything more. They start consuming more, and we haven't had time to reduce more than what happens prices go up. To reflect that increased demand, typically prices go up, all happened demand was prices go up. They'll drop, and therefore prices will probably stabilize, and you won't see sustained inflation. So sustained inflation, when constantly going up, means that a demand start, you raise your price, I keep demanding it. You buy the same amount, and you raise it again, I keep demanding it. So the question is, how can I, where am I getting my money from? How can I keep demanding stuff? No matter what price you set, I can't keep demanding more. And the only way that can happen is somehow I'm getting more and more money. And sort of the software usually happens, is something like what happened during COVID. Everybody getting a check from the government. You all got money? We all suddenly had a little bit more. We all took their money and went out and demanded and bought stuff that we used to price. But where did the second way come from? The third way, the fourth way. Well, those come now from, okay, now the price has gone up, they go to my employer and say, listen buddy, the price has gone up, I want to raise. So my wages are going up, so I have money. And where does my, oh, how can they pay you? Because they're raising prices. So the whole thing becomes the circle you stimulate demand by sending people checks. Some people, you'll fly them. They go out and consume it. That raises prices now. When I send a check, where did that come from? That check will be sent to everybody. If that check can come from taxes, if I send you guys checks but I tax those guys over there, then the net demand will balance out because they're the model world will shrink. You're on a walk with the increase, shoot more, they will shoot less. No inflation. But if instead of taxing it from them, I just print it. Now there's actually more money in the system. And with more money in the system, chasing the same amount of bills, you get high prices. And that's what happened, right? And when COVID stimulus happened, first under Trump and then under Biden, the government basically printed money on a large scale. And then, see governments are putting money in the pouch, they're putting questions to put in money, but then they kind of hit it. They do the shell game, where they put money, they give you money and then they put it away in somehow where you can't touch it. You don't have to consume it, which is called bank reserves. But here, they have to be sent to a check home. So what are you gonna do? You're gonna spend it. And as a consequence, it manifests that it's up and right. Built it through the system, and prices are going up. And prices continue to go up because wages continue to go up because employees are demanding higher wages. Unemployment is very low. Employers don't have a lot of balcony power. And employers raise prices so they can pay their employees more and then employees have more money in it. Two more, we've increased prices. And you can see how this gets out of... Well, this is why people talk about it. If you listen to the news, they talk about inflation expectations. It's not because of how you print if you're people are now expecting in terms of prices, people are expecting in terms of wages. And of course, we know that I've got to continue something. We know that we are running ever more larger deficits of over there. Biden just came out and declared that they cut the deficit more than any other administration ever. Between last year and this year. But Obama did exactly the same thing after he had a big stimulus package in 2009. And then when the stimulus was gone in 2008, he said, yeah, I got the deficit because I didn't spend that trillion dollars last year. I said, wow, Biden is doing exactly the same thing. But the deficit is still huge. Every one of those deficits have to be funded somehow. Ultimately, they fund them through 30 months. So that's where inflation comes on. It comes on with putting money. Who puts the money in the end of the day in our system in the United States? Because we have a Federal Reserve Central Bank that is supposed to be independent in how a dependent really is supposed to be independent. What the government does is the government sells bonds. So how do those bonds become in order to finance its deficits? How do those bonds become money in the hands of people? Oh, who buys all the bonds? Well, it used to be the Chinese who buy our bonds and the Japanese who buy our bonds and the Dutch and British who buy our bonds. We would buy maybe our own bonds. But there's so much of this stuff that we can't, we can't, the Chinese have stopped buying it. The Japanese don't buy many American bonds anymore. So who's buying it? So is it? Yeah, so the Federal Reserve buys it. So the government, so it's like, the Federal Reserve taking, it's like the government has two pools and they're shifting between the two pools, right? So government used bonds. The bonds go to the Federal Reserve and the Federal Reserve says money. And that's how you, what they call the monetizing the debt. That's monetizing the debt. That's turning bonds into caps, new caps. It didn't exist until, this is, they talk about the debt having a balance sheet and a very large balance sheet. That's all the bonds that they bought, which is huge. It's like eight times greener than it was before the financial crisis. It's in each other than it was before COVID. So they need plenty of money by crazy. And as they shrink, what they're trying to do now is shrink the balance sheet. What happens when you shrink the balance sheet? You sell the bonds. And if the Federal Reserve takes some money, what does it do with that money? In a sense, it burns the money strong. That's how you can take money out of the economy. So the Federal Reserve constantly manipulate the amount of money we have to trade with an economy. And therefore the amount of demand that we can, as a whole, create. But it really is determining the amount of literally money that's in our box and in our bank accounts. And that institutions can use. And it's constantly doing that by buying and selling these bonds and by setting interest rates. Are you at the interest rate? The more other people are willing to buy a bond, the better they can do it because the higher the reward for them. So that is a way for them not to have to monetize the debt. The lower the interest rates, the less demand from outside, the lower the interest rate and the more the Fed is probably talking about in debt. Higher the debt, the higher the interest rates, the less economic activity. Why? Because it cost me a lot of money to borrow and if I borrow less and if I consume less and abuse less and invest less because I can't borrow it as much because the interest rates are high, the economy starts slowing down and when the economy slows down, it gets you less and that forces prices to come down. If the economy slows down, what happens at an employment, it goes up. When an employment goes up, whatever's the bargaining power for employees goes down. I can't borrow it anymore. So I accept the wages I have, cut my spending and inflation comes up. That's the logic of what's going on right now. They're trying to create everything to a certain extent. Purposeful, they're trying to slow down the economy and the economy is already growing at less than 1%. So they're trying to slow down the economy, ultimately create resources to this unemployment, to this dis-consumption, there's this demand, people are quite stopped by us and wages are stopped by us. Think about the power that that gives our political class and the federal. It's a power over all of our lives. Basically, we handed the Federal Reserve visibility to control our supply and our demand. To control, maybe there must be more price in the entire economy. There's so much more to price than interest rates in the entire economy. To control the amount of money that we have. To control, in a sense, every asset about economic lives. When there's recession, when there's a boom, when money's cheap, when money's expensive, it's the only products that we have, money, which we invest in actually. We've given a bureaucratic organization, the authority to determine how and what we use, how this money is denominated, how much it is out of, and how we use it. That's a lot of power. I don't think we've quite appreciate, you know, we often criticize the Soviet Union all the red lines. Why were there red lines in the Soviet Union? People were standing and waiting for red. Anybody else? Everyone else controls the price? Government actually was controlling the price. I mean, collective farm was controlling the supply. Government was controlling the price. And when government controls the price, the price is always wrong because they don't have the inputs necessarily to advance the supply of demand. So the government, if the government sets the price low, how much of a part of it do you think it could be? If I told you you have to produce red, then I'm only selling it for 50 cents. You can only sell it for 50 cents, you don't have to produce anything. So supply shrinks as the price, as the government sets price control low. If the price is set high, what happens? Everybody can use it, but nobody wants to buy it. And the beauty of a modern place is that somehow we walk into the grocery store and there's almost always red there, right? And always the price is the only way for it. And that supply demand is always max. And then it has to do with the entire supply chain having prices and all the pricing integrating, all the information necessary to make the red delivery from the supermarket for us. When you have simple planning, that whole pricing mechanism go at some bureaucrat. That's a model. Model says, right, we're going to be asked. He plugs in, asks, and he tells everybody, this is the price of red. No real information to be right from movements and prices. And you get either shortages or oversupply. Always the same thing is happening in the fair. They've got gas models, national models, by the way, that didn't predict inflation, because that was the spice to them. But models, they keep tickering with the expectation of, oh, if we ticker with this or we tick with that, we can get a recession, just right. Oh, we can avoid a recession, but we can see inflation. Oh, we've got simple planners, again, setting prices. And expecting them to get it right. They couldn't get it right for an easy product like red. Red is relatively simple. In Soviet Union, they never got the prices ready right. Yet, we are demanding that central bankers get the price of money, which is like, a million times more complicated, right by setting the interest rate and by assuming how much money they get. I think there's a general principle here, where we'll get to my approach out of conflict, but the general principle is, central planning doesn't work. Never has. Doesn't work for red, doesn't work for interest rates, doesn't work for money. And indeed, the history of the federal reserve has been disaster-active, disaster-active, disaster-active. Federal reserve was in 1914. The both big crisis it faced was the stock market collapsed in 1929, which the federal reserve based on multi-contracts and all. The multi-contracts, the federal reserve at least, screwed up and took a drop in the stock market and a model of the section and turned it into a depression. And we got an impression. 1960s and 70s, we got inflation. Since then, we've got a business cycle, goes up and down, we've got a financial crisis, all of those, you can put it at the feet of the central planners at the top. And I'm not saying they're bad people. You think I'm adding time and energy, it's not even that. It's you can give them the best, you can give them the world, you can give them the best algorithm, the smartest AI. And it's exactly what they're trying to do. So from an economics perspective, purely economics perspective, they buy that impossible job. And I don't think there's a easy fix. People suggest rules, sort of take away the discretion, so take away the political manipulation. Rules are better than what they do today, but rules based on what? And again, it's a formal cycle plan. And the question partially is, why does a cycle plan work? And one reason is this problem of calculation, in fact, we don't have a market that's a crazy. But the other issue is, what does a cycle plan assume? What is behind any form of a simple plan? Or in a bigger picture in generalizing more, why don't we have a government? What's the purpose of government? There's a lot of students you should know. What's the purpose of government? Organize yourself. Yeah, so to organize is us. So the purpose of government is to organize us, which means that the people in government know how to do that. In other words, they know what's good for us. They know what our values are, and they know what kind of values we should live, and they have a small ones, and we have a little dammer, and they're gonna organize us and tell us how to live our lives. And that's a common view of what the government should do. It goes back to the players we're calling. They want to organize us a lot more than the US government organizes us, but you want to organize every aspect of your life. You know, players who are gonna have the philosophy of kings choose who you should marry. The philosophy of kings will choose your character. The philosophy of kings is gonna, because you're in a cave, I don't think we're gonna play it over, you're in the cave, right? You're in a cave, you see shadows, you don't know the truth, only the philosophy of the truth. They won't dictate your life. But that's the idea of organizing our life force. I don't think anybody organized my life. Pretty damn good job when I do my own. So what do we need government for? What are the common views? Protection. Yeah, so we need government to protect. And I would argue that that's, you know what do you think we really need in a sense? The only group we really need government for is protection. It's more complicated protection because it's law and making that protection objective, which is not easy and not simple. But it is fundamentally ultimately protection. What facilitates human warming? What is it that makes it possible for human beings to thrive? What's that? Stability. Stability. So I'm looking at something more fundamental than that. So in a sort of environment, even as an individual, what do we need to survive and provide us human? Well, you can ask any question. What makes us human? Don't say no. What makes us human? What allows us to survive as a biological entity called homosexuality? Correct, not every reason. Yeah, our ability to think, our ability to reason, our ability to use our mind, to figure out what is good for us and what is bad for us, what, you know, what's gonna lead to death and what's gonna lead to life at the very base. How can anybody have their gene for hunting? Gene for agriculture? I mean, even the base, you might be good at it, but you might not have a gene. It's good at it. The hunting of that is a problem. Not that far. If you, if I take any one of you, drop into the middle of the answer, there's only one thing, there's one fundamental thing you have to do in order to survive. If you rely on your genes, if you rely on your instincts, you will die very quickly. What's the one thing you have to do in order to survive? One thing, soul follows. So you go back hunting and agriculture, right? You have to, you know, we're pretty pathetic species. We're slow, we're weak, we don't have claws, we don't have fangs. Go and go down a bicep and eat it by nature, right? You're not gonna do that. So how are you gonna survive as a human being? How do we get bicepables? We don't have bicepables, yeah, maybe. How do we get them? Well, we have to plan, we have to build traps, we have to build weapons, we have to strategize, we have to hunt, but to hunt, we have to do it. We have to go through cognition, we have to go through it, post there's a reasoning. Same with agriculture. Nobody is born with the knowledge that a seed turns into a plant and you have to water it, you have to use fertilizer. All of that is discovered knowledge. All of that requires some body to think, somebody to figure it out. So the fundamental way is you're gonna be supplied by using your mind. And I would argue that the fundamental way to achieve happiness, to achieve anything in life as a human being is ultimately by using your mind. I mean, you have to act on it, but you have to start by actually being able to think it through. Choose your value and then to swap path to achieve your value. What's the enemy of that? What's the thing that makes you think you're relevant? And ultimately, you won't even do it. What would I do to you to make you think you're relevant? I'm sure to kill you. What's that? Yeah, fight you. And what's the most frightening thing I could do to you? Yeah, violence. Violence is the most, because I could have gotten back with your head. Reason is out. It's not about reason anymore, you're survived on the other hand and following my words. If I tell an entrepreneur this stuff over here, step sells never going to be approved by the FDA ever. You can do all the research in the world. Then you start going to even do it. No prevention capital is going to invest in it. You shut down a whole field of human endeavor by using basically violence. We're not going to allow this, right? Who asked you? We're not going to allow it. That's a threat. That's a threat you like. That's a threat you like. That's a threat that limits where you're going to promote your attention, where you're going to promote your reason. You're thinking, you're rational. So human beings by themselves, as individuals living alone, government being in this, right? There's nobody to force them. But once we get into groups, some people want to force other people to do stuff. That's just the reality of life. There's always going to be some people who want to use violence one way or another to force us to do something. Now sometimes the violence will manifest itself by just pulling out a violence signal to your head. Sometimes the violence will manifest itself in the fraud, which I consider violence, right? Fraud is a way of getting something from you through deception. And sometimes the violence will manifest itself in this group voting to take the stuff from this group called a democracy. The democracy can manifest itself in violence. It tends to ask sufferings, right? Why does something deny? Because you're doing what I do, is corrupting the youth and challenging the fundamental beliefs of God's morality and all these things. And as citizens of Athens wouldn't tolerate that, say that together, then they'd vote their base. But it would try out. It was basically a democratic vote. It's a fundamental. There's not speech in democracy, pure and honest. So when we get together in a group or we want to agree on the one thing that is most important to put it aside to agree on is no violence, no coercion, no force. And we need an institution to be able to, you know, make sure that that indeed happens. And that's a government. And that's the purpose of government. Should be the purpose of government. It has to be usually the purpose. Usually governments do the opposite. Usually the governments are in a way that some people are going to be powerful other than them. But the idea of the government is a radically forced human interaction. So as individuals, they use their minds as individuals in pursuit of their own values, free of force, coercion, authority. Free of people forcing their ways very much. What's the concept, if you will, to the constitutional concept that captures this idea that you should be free of coercion, you should be free of violence, free of force. And the government's jobs. Well, the government's jobs are a thing. But what is the concept that captures this idea of freedom, freedom of freedom in pursuit of its own value? Right? Right. I mean, that's what an individual writes up. The way to life, what's the way to life mean? That's what it's like to be careful. What is the way to life mean? But for some aspect, from a locking perspective, and I think from the current fathers understanding of it, the way to life mean, you have a way to make decisions about your life, your life and your life. You want to live, go live with experience. Freedom of what? Freedom of farm? Or coercion, farm? And what's the world government to protect that life? In other words, protect your freedom to act free of coercion. Not to be the entity of coercion, but to be the entity that extracts coercion from society. The way to live in freedom is the way to think, to wait, to lecture, to talk about ideas. We are coercion, we are coercion. You know, the way to pursue how? And there's also master kings in the declaration of death. There's you as individuals living your life based on your own mind. It's no accident the declaration comes after the enlightenment or during the enlightenment, but in terms of during the period where there are a year of reason, the way to deal with our thought is elevated in human experience. And that's the only way we know knowledge. It's the only way we can decide our values. It's the only way we should shape our lives. And all the government is there to use the technical ability. And not to say you can't kind of conceal what you can't kind of invest in, what you can't kind of do with your life. That's the opposite. That's the violation of rights. That's the government gives you courage and against you. And in that sense, if you hold that kind of view of the government is there to protect us, protect our freedoms, protect our rights, to protect us from coercion, of course, they look forward to government having money. I mean, it's sad that they even included in the Constitution, it would be nice to just exclude it. But even then, it's about minting up, but not setting the value off. It's about very basic simple plans that they were supposed to do, not manage the entire financial system as they do today, certainly not have a simple bank. They basically monopolize all money. And if I were to start, I mean, people are trying out Bitcoin and crypto, so they have their own money and we'll see how long the government lets them do that. Right now, the market itself is in glory, so the government doesn't have to do anything. They sit back and wait as the crypto bubble collapses. But if Bitcoin actually took off, is there any doubt that the government would shut it down, use coercion to stop it because the government hasn't monopoly over money? But we didn't get that, that coercion and that's forced. That's telling me what I can and can't do. So in my view, the government has no wall, in our economic life. And that's a big, big statement, an ambitious statement. No, in our economic lives. Other than help define and protect populist. Populist can be tricky. So let your populist be tricky. Populists are the wearer of the tricky. Even figuring out exactly where the fence is, exactly where the populist line is, as some populist who neighbors is not always straightforward. We will look at this to help define them and then there'll be the arbitrariness of the streets when we use a court system to arbitrate and have objective laws and how to do all that. But other than that, the government has no business in our economic lives. And as soon as it tries to step into our economic lives, it's using force, it's using coercion. It's imposing its will on us. And the Federal Reserve, again, is a good example. The Federal Reserve was established in 1914 because politicians will piss off that in the big financial crisis of 1907, we've been about this big financial crisis, a lot of banks fail. There's a lot of problems. The used economy looked like it was on the brink of a question. GD Morgan, private banker, stepped in, got all the other bankers in New York together, locked them in a room and they sat down and figured out a solution. They solved the problem. They basically helped some banks step this all out of the way, bailed out, but it was all done by them. No government bailing. And it was resolved. And a lot of politicians will get set because how come private investors can walk and have so much power? So they had hearings and the consequence of those hearings was ultimately established of a central bank that takes away the power from GD Morgan and gives it to Ivanka, somebody appointed by the government to go along with this. So you get 1913, you get hearings, 1914, you get the Federal Reserve. And yeah, the power of private bankers is strong dramatically because of the consequence. And then you get, and then in the 30s, you get massive banking regulations the securities law that we know of that have been put securities in bank, laws and since then is piling regulation by regulation by regulation by regulation. And by regulation, they're attached to in a localized basis, so you can apply a human being. They're ways to, they now argue it's ways to fix market failures, but they're never ways to do that. They're ways to actually create more better quality. I don't know, a single regulation is actually the best. So far, market failure. And you can see that piling up. If you study securities regulation, it's just layers. One on top of the other, more regulation, more regulation, try to fix the problems that the previous regulation created. And as part of that, you might view that there should be no Federal Reserve. I mean, the issue of money and the issue of what money should be and the issue of all of that should be up to us in a market place. What do we demand? Now, historically, we demand gold as money. That was a kind of standard. Maybe in the future, it would be Bitcoin. I don't know, I doubt it, but maybe it would be Bitcoin. Whatever it is. Why is it any of something central? I know it's business. Unless they find an organized society. In other words, a suit that's so-called common good, public interest. When I get a common good public interest, I want to run for the years. Because there always is code or they want to control whether. They don't trust me to choose my own values. They don't trust me. They live my life the way I see fit. They want to impose their will. I mean, an excuse of, yes, you might be running right now, but it's good for everybody. How do they know that? How do they measure it? So, a problem of utilitarianism, how do we figure it out? It's impossible. It's just a way of control. It's just a way of power. So, you can tell your best side. I think he's a best side, but that's not it. Harvard, Reveal, Reveal. They're a real Reveal. More dangerous than anybody in the world. And so, it's a wanting to control our lives. Once you start interpreting the constitution, not as protecting individual rights, but as protecting some kind of common good, that nobody can define, except the people in power. You're heading towards disaster. But that's where I'm pushing I think much of the main roles into the games. Oh, yeah. I'll take any kind of questions you guys want. On this way, anything else? Yeah. So, I can agree with you on almost everything, almost. But, you know, just in practical reform and as we look forward, you know, we had for a good number of years screen span that a follower of mine ran. Which creator? Explaining about which creator. And during that time, Friedman and others, I was less comfortable with it, but Friedman proposed, you know, what you do with some sort of Friedman world. You do a formula. You have it less discretion than that. You seem uncomfortable with this. Wouldn't this be a better, at least transition proposal? No question. So, if you had to talk about the Fed today and given that there was a Fed, then a world-based Fed is much better than a scratch-free Fed. A scratch-free Fed is ultimately a politicized Fed. And so, you see how Paul said, okay, so in 2018, and Paul wanted to raise his face and prompt Friedman yelled at him and said, hey, just get going down. You've seen that many times in history. For example, Asian states never go up during the presidential election. You can go back and check. Your Fed increases and should be during the presidential, because they don't want to play ball. They come down during the presidential, yes. So in 1992, they started decreasing interest rates just a little too late for George, that's where Clinton went. One quarter to it. If they started the quarter earlier, both would have won. That was the election where it was the economy stupid. It's the economy stupid. So, yes, the world would be better than the Fed, because I don't trust the Fed anymore. The Fed is the largest employer, PhDs and economics, of economics in the world. And I don't, why I don't trust. There's some of you, there's some of the economists that find this guy, I don't trust these economists. And, but they all get PhDs out of schools. They all have to wait the same kind of visitations. They all pretend to hold the same kind of views because the largest employer, PhDs and economics, has a particular view of the world and you benefit it. So you don't get much of a sense inside of that. You don't get much interesting things out. The problem with the world forces, we'd want, doesn't really work, but how long does it work? What about in crises? It's too easy to violate a world of crisis. So, yes, better, but not the solution. And it's interesting because when Trump, Trump got to nominate a Federal Reserve, Federal Reserve Chairman, he's the one who appointed Powell in the first round. And he had a choice between Powell and John Taylor. John Taylor is an economist from Stanford University, very, very well guarded. Fairly to be market, let's say I'm generally told so as a free market, but Taylor has a famous war in there. It's called the Taylor War, which is a war far too fast. It's a war far the Federal Reserve should be made. So basically, Trump had a choice between war sky, the discretionary gun. And I remember at the time I said, it's not this way to be the pick. There's no way in hell, and it's not to trump any person. It's not to pick a war sky. Because then he has no power. Or at least you assume he has no power. He picks the discretionary gun because he can influence it. This is the problem of politics in the economic, one of the many problems, is the side of economics. It's about politics. All of these things are about politics, not even. So he picked politics that he couldn't easily manipulate power. John Taylor would have said, following the rule, and long time in the war. Now it's a real question, I think John Taylor's a good guy, real question, under that kind of political pressure, would a federal chairman stick to the rule or not? That's the answer to be determined. I think I was following some kind of war in the 90s, but then in the 2000s he abandoned it. And then we got, and I think as a consequence of his abandoning it, we got the financial credit. He was following the Taylor rule up until 2001 too, when he abandoned the Taylor rule after 9-11. And by abandoning the Taylor rule after 9-11, created the interest rate and economic environment that led to a financial crisis. And whether it's a Taylor rule or whether it's a gold price rule, I mean, it looks like a Taylor rule exposed, but it's not clear that's what he was actually doing. He might have been talking about gold prices, which we could be consistent with what he was writing earlier. I had to tell, but he abandoned it very quickly when he needed to, or what he thought he wanted to do after 9-11. Oh, so the banking background, so the study, you know, SEC regulations, et cetera. I'm curious what your opinion is on the benefits of some sort of market security regulation, protecting investors versus the downside of the company distracts them from the actual business purpose. So I believe in regulation, but I believe that the best way to regulate business is the market and businesses themselves, kind of what we can call voluntary regulations. So for example, securities regulation, which I think is a disaster and a mess. I mean, one of the things I do is I run a hedge fund and it used to be in the 90s that what differentiated a hedge fund from a mutual fund was a hedge fund was unregulated. I believe I didn't need to do anything for 50 months. And that's not true when I have to regulate SEC and you monitor anything that you do and you have to file all of these things. But, you know, and there's so much people to be, we have full time compliance officer for smaller hedge funds, which is insane. And the people look into restrictions and constraints of what we can say, whether we can do social media, can I tweet about my fund, and then who can I accept my fund? Like, unless you have $5 million of investable securities, liquid assets, you can't invest in my fund. So my funds is for rich people only and people complain about inequality, right? If you're middle class, you can't invest in my fund. You're poor, you can't invest in my fund. By law, even if you're willing to start, even if there are 18 funds, and this is the stability of it, it's one something spin off. Whereas I think what would actually happen because it's true that if you had no rules, it would be crazy and I think your people would participate in the markets and people would be afraid, like, let's say you had no insight training in law. How about insight training? Is that interesting? Topic of the law still is better. Like, you know, if you had no insight training, then a lot of people would say, oh, I don't want to trade because I'm not training again, so I'll do this information and so on. Well, what is the market mechanism to solve these guys? And this is the thing, there's always a market mechanism. If there's something with screening ability to do something, there's a profit opportunity and there's somebody to come in and set this story right here. So who hasn't been set up to regulate finance or activity? Where it wouldn't be regulation by course and regulation to copy? Who is secure in this, that's that, instead. Who makes money? Other party, for example. Exchange. Like it used to be in the old days, NYC, NASDAQ, Philadelphia Exchange, Chicago Board of Trips, they were all the state exchanges competing with one another. And one way they could compete about it with one another is different rules for listing and trading. So for example, I'm NYC, I say, with me, no insight in trading rules. You can anybody can trade, no rule restrictions. NASDAQ says, here are the things that are allowed, here are the things that are not allowed. And let's see what looks better, economic. But the idea that you need to have government controls or anarchy, chaos, is I think false because you have market, the market needs order. And I think that order will come from institutions that the market will create in order to facilitate that order. Exchange is a good example. But we don't go to carbon stocks and any stock. We have to have an exchange that helps us and reduces all the information costs and all the transaction costs that are involved. But it could also now, for example, it could set standards for financial disclosure. You could say, if you want to list at NYC, you have to abide by these accounting rules. And another exchange could do another. Or it could have, if you're this kind of company, these are the kind of rules. If you're this kind of company, that kind of, no, instead of that, we have one set of accounting rules in America. And they apply equally to high-tech companies, to all the industrial companies there, to services companies, they all file basically under the same accounting rule, which makes no sense. I remember in Silicon Valley in the 2000s, there were a series of companies, they were issuing two sets of financials every year. One, FASB, of course, you know, and one, what they thought made sense for investors. They stopped doing it because it's too expensive. But you don't get any flexibility with one size fit of government rules, government regulations. So I think there's always mechanisms that solve the problems through a market that the government is trying to solve through regulations. And regulations always screw them over the matter. Like if the AC is a good idea, right? It sounds pretty good. And you don't want to have to bother every time you go to the bank, to figure out if the bank's sold or not sold. So you just give the bank the money and you're going to get to use the funds and that's fair. And it's easy. What harm does it do? Well, it creates massive harm, hasn't it? The bank doesn't care about losses because the government's going to bail them out. They only care about the upside. What happens when you care about the upside, you don't care about the losses? You take that huge amount of risk. So banks did that because of deposit insurance, which they have to get. You can't take deposits in unless you have FDIC deposit insurance. So then you have all set of regulations limiting the risk taking of banks. Because they were taking on too much risk because of the regulation, it was put in place to protect supposedly deposit. The little bank. Honey, the little bank, we know that $20,000 cash in the bank. It's never to protect the little bank. Nobody in Washington cares about the little bank. It's always to protect the big banks who actually manipulate those and then do it. But it's the control. So regulations say then you have regulations of risk and then banks are limiting what they can do. So you have to regulate something else when you have to impose something else on it. And that's how you get layup on layup on layup on layup. Now, if you work in a bank, you come from that environment. I mean, a lot of regulations is just unbelievable. And some of them conflict with one another. You've got on the one hand, you've got privacy laws, for example, at a bank. On the other hand, you have these requirements to let the government know whenever there's a court suspicious activity or anything over $10,000. But now they want to lower that even further. So what do you do? You protect the privacy of the individual whether you let it or you have to let the government know you're violating the privacy laws. And how do you resolve those? Well, banks resolve it by exposing more and that's it. They kill us like you're privacy. Then they do a lot of what they seem to be doing. You snap your finger and resolve that. Obviously, they'll be great. And you can get rid of all of these. And the arbitrarian needs these. What is the realistic path towards that? And where do you start? Yeah, I mean, I don't know. Firstly, you have to get the right people elected. And the people, the people, us, the people who do the election were actually at the once a dissolution of a separate the government from the economy at some level. And we don't have any of that. But it should be, we have it. Then you would have to figure out a carefully designed path of unwinding these kind of regulations. And it's not easy because if you eliminate the risk controls over banks, that you keep the budget insurance and banks are going to take up too much risk. That is one simple example. So you have to layer them off in ways that minimizes the risk to the system. And that's very complicated. But I would say, you know, if you gave me, you know, I take our four year or eight year program and say every year we do these steps. First of all, you have to be completely transparent. So the market has to know what's coming. So for example, with regard to the Federal Reserve, I would first go on a gold standard and then dissolve the Federal Reserve. So because the gold standard would give it stability. And the way to go on a gold standard is to say, OK, January 1st, 2024, we're going on a gold standard. Whatever the price of gold is that day, or the average over the last three months or whatever, that is the price we're fixing gold. That's the price we're going to use for the future for gold. And then once you do that, then now I'm dissolving the theft. Here's how we're doing it. These are the five steps. This is how we're moving this gold into the pot. All these reserves, which are now in gold, to the banks themselves. And the banks themselves get it. And by the way, banks start planning on having to print it because you're going to get actually any money to the extent that you start an economy with cash. You're going to actually have to print that cash. So figure that out. But here's the date when it's going to happen. And then at the same time, in parallel, here the regulations were eliminated. Here are the different steps that we're taking to get rid of it. All of it would have to be transparent. Because otherwise, every time you do this, it would be shut to the system. And markets would get freaked out. So you have to do it slowly and systematically. And it has to be over, given the President's election every four years, it would have to be over a four-year period. You have to have a four-year plan for undoing financial regulation. Four years is pretty intense to get it done for you. But you'd have to do the same thing. My view is you have to give it a security. You have to give it Medicare. One way or another, we're going to. It's just a question of do we do it when they're bankrupt, if we do it when we have time to actually plan for how it looks like. And you just have to do the same thing. You can't just come off saying, well, sorry, no, it's not security, but you have to say, OK, here's the plan, how are we going to do it? So if you're 20 years old, you don't get it. But if you're 60, you'll probably get most of it. And here's how we're going to fund it. And you have to have a, you know, one of the strategies about political system is nobody has a plan. Except, it's very money. But beyond that, there's no money. And when they do come up with some kind of plan, it's usually a hard spot of different ways and stuff that different senators of Congress stick into the bill in order to get something out of it. But it's not, it doesn't call. Even on the left, it doesn't call less into anything other than more power and a greater power than it. So you need to have a plan. You need to have a never strategy. You need to be unbelievably transparent about how you go from point A to point B, because otherwise you create chaos. Since this, as long as politicians have some leverage status, they don't have the incentive to have a plan that will come to the table in the last event, you know, it's always going to get politics and we deserve it. So we can blame the politics. But then it pays us. We don't demand a plan. I mean, looking for Republicans running this last time, did they have a positive message? Because it's something that you knew that if you want for a Republican, this is what they were going to do other than ban abortion. But this is what they were going to do. What they said, Biden's bad on inflation. OK, what are you going to do about inflation? Psycho. He did all these bad things. What would you have done if you were there? We know what Trump would have done. What would you have done if you were back? Don't even ask a question. Come on. My name is Randford because each other, police, Democrats, whatever, these are national republics. OK, what are you going to do about it? What are the actual steps? Did you plan to, did you use crying in the mirror? No, well, you know, compare that to one of the most successful, I think, Republican congresses, which is the 1994 kind of Newt Cambridge Revolution, but it was a contract with America. I didn't agree with much of it. At least you knew this is what they said. This is what they believe. This is what positively they were going to do. And this time, if you ask McConnell for a coffee, what about a coffee? No, no, no, we don't we don't actually present a positive. And we went and we go vote for the bachelors at work. So I'm kind of happy that they had a bad night yesterday, even though I hate the Democrats as much as anybody. I'm glad because somebody has slapped them in the face and tell them what you're doing to sit there. And the electorate has to do that. Who else is going to do it? So, you know, there's where is it? Republicans probably stand for it. We know what the Democrats kind of stand for. What are the Republicans stand for? Particularly post Trump. I don't think anybody knows what it is. So we, the people have to demand better and have to expect better. And only then when we get better politics, we won't get it by chance. I mean, an accident might happen, but I mean, I think Ronald Reagan got elected who I think was better, a little bit better at least because the culture had shifted. Because those people demand something different. They were so fed up with Jimmy Carter what happened in the 70s and inflation in the 70s that they wanted something different. They were willing to experiment. And Reagan was kind of like, okay, let's go. In a sense, they did that with Trump, but the gulf between Trump and Reagan was huge. Because Trump said, I'm not going to tell you how I'm going to fix all the problems across them. And we said, yes, great, because the real estate developer must know what you're doing. And when Reagan actually laid out, Reagan actually had a vision and Reagan actually told you what he stood for and what he was going to do and what he wanted to do. And again, I disagree with the country with the plan, but at least he had a plan. He had Trump kind of vision. And so we won't get changed until we demand our politicians out, stand for something. And actually be willing to communicate what that is. That's going to be a big difference. Final question? Why are you moving? Let me see if we can do that. Oh, I see what you're talking about. So not on the topic inflation, but on the topic of the minimal estate. Yeah. Does the United States or some sort of minimal estate doesn't have a standing army? And how does it stop that standing army from becoming a government? So I don't, first of all, I don't like I'm sort of dangerous. It seems bad. So I mean, I'm from a limited government. I don't even like small government, limited government is the way you can accept it. And limited by individual rights, that's the purpose of it. Doesn't have a standing army. I think in the end of the day, it depends who you are, right? You know, if some countries can afford not to have standing arms, some countries cannot afford that. No, I haven't. And I think the United States, given where it is geographically and given kind of its ambitions meeting the standing arm. But this is the challenge. How do you fund this thing? And this is, I think, what keeps a, what in a truly limited government perspective, my kind of government would keep, would restraining is to make it a limited, you know, a standing army of only so much size and not a limited size. Is that I think that ultimately funding for such an army would have to be in some form or another. That is that it would not be cause of taxation. Because it's cause of taxation, then yeah, there's a massive incentive to grow that army and to keep going with that. And it's very difficult for us to organize, they're increasing our taxes just a little bit. It's too incremental. And as the economy goes, remember if the taxes 10% and the economy has grown a lot, then they're getting a lot more money. Or what? You know, you think that actually what they need on a daily basis stays about the same. Doesn't have to grow. But if you make contributions to support the military policy, which I know some of us are, but imagine a world in which we all go checks to be government for the economy. Then eight, you would, depending on your view about military, you would support it more or less. But if they were engaged in a war, you didn't support them, you would stop supporting them. They would get less money. If the army needed to expand their economy, in case they're actually convinced you of the need to grow the military. I think that it would become much more sensitive to our wants as citizens who haven't been to the powers to be in their ambitions. But, you know, the United States arguably has, it devotes a huge amount of its money to a standing army. And today, and that's partially because we've taken on the mission of defending the entire world. And that's not a mission I think most Americans actually want. So one thing I agree with Trump on was, I mean, Europeans contribute almost nothing to their own defense. We basically protect them. They have free writing, I suppose. Why? Why should the United States even be in there? I mean, I understand, Europeans want a united defense to protect themselves against the enemy Russia. But why do we need to be part of it? We have the money. Because we're willing to do it because President of the United States has a lot of power, he does. So if the partitions that we send could be part of an ideal, but this is really to take the lives and property of American citizens scattered. And I think we could have a small army if we didn't have to have bases in 120, 15 countries around the world. And I bet you that of 120, less than 20 actually have to do with the security of America and the rest have to do with meddling in other people's affairs. Primarily, you know, increasing our politicians power over other countries and power over the world. And have little to do with protecting us. So how do you protect the government, the military taking over ultimately? Even if it's small, you know, the only way to protect it is that have such a great country, I think you would, that the people would rebel against such a military and the military never want to do it because they wouldn't do it. There's no mechanism you can build in that could protect you and not be crazy occurrence. You know, people can do bad things, bad things will happen. And you want to minimize those. And I think a system that has a very limited government constitution very clearly defines the world of government. I think ours is pretty good that it can be a lot better at defining the scope of government, limiting government appropriately and finding it. I mean, it would be nice to find it in constitution. And then explicitly said that the world of government is protecting the new rights, not doing anything else. That would save us a lot of damage over the last 250 years. But that found us the logic that thought that was so bad. They just assumed it was in the water. It was in, they were meant to be late. This was just part of the cultural environment in which they lived. They couldn't imagine the world there was, we have no concept what the individual rights are. I mean, literally in 1990 set of law schools, they don't know what individual rights are. Indeed, most conceptions of rights are false. And that's certainly not what the farmers meant when the declaration of constitution was written. How many Supreme Court justices today sitting on the Supreme Court think that the declaration of independence is important for understanding the constitution? Well, that's it. Only Supreme Court judge thinks that the two have any relevance. And as Scalia didn't think they had any relevance, Scalia thought individual rights were nonsense on students. That's a great conservative Supreme Court judge thought individual rights was the founding concept of the American idea. The whole basis for the forming of the American government, that concept, that watching concept was according to Bentham and Scalia, nonsense on students. So yeah, you know, we've got a long, long path to go and so as we react, the ideas of the founders have a way to modernize them and to take the lessons of the last 250 years and apply that to a modern constitution. Yeah. Do you have time for one more question? I can go on over there. What's your outlook for the next two, three years, something we'll say in the final of your sessions? Oh, you cannot. We're going to have a session next year. I don't think there's a way out of that. This idea that the Fed could engineer a soft landing is again a belief in simple planners ability to do stuff that just doesn't exist. This is an organization that didn't see the inflation coming. Why would we believe that they could undo it in a smooth way? So we're going to have a recession. I mean, the two question, how deep is the recession going to be? And then is the recession going to be enough to kill inflation? Because people could get in the early 1970s and get inflation. The Fed raised interest rates. And we had a recession. And inflation went down. And the Fed lowered interest rates. And inflation went back up. And it went like this until Volcker finally raised interest rates. Mostly was that the need for a second, very strong need for a second. But the only reason I think inflation was like killed during the Volcker for years is not because of Volcker. He did what he was going to do at the same time. Ronald Reagan in the tax reform, or at least may change the tax reform in 1980 to end, Jimmy Carter and Ronald Reagan completely deregulated the economy. Massive deregulation of Jimmy Carter and then under Reagan. And what does that do? That frees up supply. So if inflation is this mismatch of demand of supply, one way to fix it is to liberate supply. And by deregulating, you increase supply, prices stabilize. And this is the role of the federal governing inflation. If the Fed is deregated, but I don't know if a single senator can't work. Maybe I know three senators who think that the US government should deregulate on a scale. Maybe Rand Paul. Maybe only Rand Paul. I mean, in all case, they would say maybe Ted Cruz or maybe Lee. But I don't believe they care about anything anymore after the way they brought Volcker to Trump. So I think it's Rand Paul. He'll do well to Trump. But so don't be believes in deregulation. Today, what we do have to do is you need to spike in interest rates. And then you deregulate, back up and spam. No way that's happening. So I wouldn't be surprised if we had a session and we continued that inflation after. So it looks like we're going to mimic the 1970s. Nobody wants to learn the lesson. And nobody has the political courage to learn the lesson, to actually learn the lessons. Now, I think that maybe Republicans want, hopefully they win the House, and hopefully Republicans win the House. Because that will at least stop. I think the one thing Republicans are good at, when they're in opposition, is they tend to reduce spending. What they do is they cut a deal with the Democratic president that if he wants to get anything done, that he has to free spending or cut spending or cut it as a percentage of GDP or something. And that would be good for inflation. If the market sees government's not growing at the same pace as it was growing before, that would be good in terms of inflation. So that's the one thing. And I think Republicans will probably win the House. So I think that that would be a good signal. The deregulation is not going to happen, so we're not going to divide it. And I don't know who the Republican president will be, who will be regulated. People say the Santas is a really nice, I'll believe it when I see that. And then we'll see if Powell has the courage to take this where it needs to go. He seemed, give him credit. He's saying the right things. He's saying the right things. He's saying we'll continue to raise as high as necessary. But saying it and doing it and that's it. So we'll see what kind of political pressure comes out of that. One says it's second, it's an employment. People are sad, people are unhappy, and it's all that fits forth. And all the leftist economists say, no, you never need to do raise in the streets. And all inflation is going to die by itself. I mean, we're hearing that already now. So the pressure will mount on me. So conditions are hard, social conditions, and sense are harder than long-term predictions. But I do expect to be second. And I fear that it won't be enough in terms of ending inflation. Because I think inflation might be more sustainable than what it would be. And this other side. Thank you. Thank you. Thanks, guys. Good morning. Good morning.