July 8, 2016 • 58 mins
Modern civilization relies on the concept of debt. Wars are fought over it, loves lost and revolutions launched. So what would happen if, one day, it disappeared? Is it even possible? Tune in to learn more.
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Speaker 1 (00:00):
From UFOs to psychic powers and government conspiracies. History is
riddled with unexplained events. You can turn back now or
learn the stuff they don't want you to know. Hello,
(00:20):
welcome back to the show. My name is Matt, my
name is Noel, and Ben your you and if you
are one of the people who happens to live in
the United States, and you're an average household then you
have around one hundred thirty thousand, nine hundred and twenty
two dollars in debt, and of that, fifteen thousand, seven
(00:42):
hundred sixty two dollars can be attributed to credit cards.
Holy mackerel, We're starting off on a positive note today,
my friends. You know what I think. Again, this is
the second time I've been slightly below average the same,
you know, but it's it doesn't feel great. Oh wait, no,
I am way above average. You got to count the house.
(01:07):
Uh if you count mortgage, that's interesting. Okay, well then
I'm well above average then, But it doesn't The mortgage
kind of count as as an investment. I mean that
it depreciates over time, so it's not quite the same
as being in debt. But I guess it's looked at
that way as by creditors. Yeah, it feels that way
now now that I'm thinking about it. And uh, you know,
(01:28):
the reason that there's so much debt has been uh
talked about at length for a long time by so
many people. We often, we being the majority of the
public across the globe, we often don't have the best
(01:49):
or most sophisticated understanding of what this is. And that's
why we as a species become embroiled in these strange
situations sometimes when all of a sudden, like consider the
Great Depression, Right, people are starving in the cities, right,
But in the rural Midwest and the farming country, farmers
(02:13):
are throwing milk away and just gutting pigs and saving
what they can because the price on those animals and
that you know that that beverage, I guess has tanked.
Some feels weird about calling milk a beverage, but basically
what I'm saying like, that's and and then the reason
people would come to find that folks were starving in
(02:33):
one place when people were trashing resources in another was
due to something called the economy, right and right, and
then people would say, people would uh, the pundits would
be on the radio. The populist, the nationalists, the whomever
is would be on the radio arguing why they alone understood, uh,
(02:54):
the one true economy or what that thing should be.
And now we're in a world where I guess I
want to start off with a question. So did you
guys have economics classes in high school or in middle school?
I did, but I felt like I feel like it
was rolled into something else, or it was like we
(03:15):
got half an economics class and then like the other
half was was Civics or something like that. You know,
but my memory of those days is a little hazy.
That's maybe that's made up. I got home ec Yeah,
I took not the same thing. No, I mean it
was personal finance. It was personal finance. It was all
It was all that kind of stuff like how to
(03:36):
how to manage your your stuff, But it didn't teach
you how the FED worked, No, and I how to
how to write a check effectively? Right? What are the
things that I always think about? Is you know you're right, Matt.
For many people, at least in this country, the closest
thing people were offered to a personal finance class in
(03:56):
a public school is going to be home economics. However,
the individual person would probably be in a much better
position today if personal finance classes were mandatory. And I
know people don't like big brother federal mandates, but that's
an individual education, that is that is necessary to survive,
(04:19):
a lot of people don't get that, and that's why
we end up in a country where the total debt
oh by US consumers. I can break it down, all right, Uh,
let's see now it's time for a breakdown. Right. Oh gosh,
youa So what's the pressing one? Do we have a
backbeat for this? Oh? Yeah, okay, So credit cards seven
(04:45):
hundred thirty three billion dollars pales in comparison, of course,
to auto loans one point oh eight trillion dollars. And
then we have student loans one point to three trillion dollars,
(05:07):
and finally mortgages eight point to five trillion dollars. So
all of these numbers, these massive numbers, this is debt
um It's money that I guess needs to be paid.
(05:28):
What is debt? Exactly? It's called American dream dollars. Oh,
as in imaginary dollars, which is this episode today we
are talking about that, and that I'm I'm laughing, because no,
what you just said ties into so many other episodes
we could do. It hit us in our the course
(05:50):
of our research before we went on the air this week.
That currency itself is just a fascinating weird thing. It's
an agreement. We make it totally is It's like it
could be shells, you know, good shells, or or or
a handful of sand. When you were a kid, did
you ever play the game where you just all agreed
that the floor was lava. It's like that, but with prizes,
(06:13):
and you can move the floor for a bunch of people.
I know that's that's a very biased thing, but well, yeah,
what is what is debt? That that's the question we
start with today, even though it's not our ultimate question.
So the good, the bad, the ugly of debt, Well,
it does do some oh nice copyright. Oh was that
(06:40):
Ineo Morricone? Oh man, he's the master my favorite soundtrack.
I'm gonna go listen to that for the rest of
the weekend. But the good part about debt, and there
are good parts, is that it sort of makes the
world go round. What are some of the good things
that this debt system does? So in the most bay
sick of terms debt is it's it's an I O U.
(07:03):
I mean it's without going into the entire history of
currency and money. As we know, at one time they
used peppercorns. Peppercorns or currency that's got a function. It
makes your food nice and spicy. But you know, I
mean many forms of currency were redeemable I O U S.
I mean that is essentially what currency boils down to,
is the redemable IOU for a good or service, either
(07:24):
physically they contain some sort of valuable material a metal, gem,
what have you, pooka shell, whatever, um or they were
redeemable for the same amount of a different material. Okay, yeah,
So like an example for folks in the U. S
And I know our numbers are pretty US centric at
(07:45):
this point, but we can get bigger. Uh. In the US,
there were these things called silver certificates, which UH fans
of certain JFK assassination theories will be familiar with. And
until nineteen before these silver certificates legally could be redeemed
for the amount of silver that was mentioned on the currency,
(08:07):
and then they stopped. Yep. But the reason, the reason
why money, why currency is so important to the functioning
of society is that all the goods and services that
are available for trading in some way or another, they
get boiled down to this common denominator where you have
X amount of this and I want to give you this.
(08:30):
I have X amount of this. I want to give
you this. We can trade with this one thing, rather
than having to break down exactly how much a goat
is worth in terms of wheat or something like that,
or you know, a car in terms of the shelves
or T shirts or something strange. Yeah, yeah, know why
I'm hung up on puka shelves. I think I think,
(08:51):
you know, maybe you could bring it back. I think
it's because I went to that widespread Panic concert last
night and I saw a lot of those. Yuh, I
got a text from you. The three am was just
an animated gift of a puka shell dancing furiously, dancing furiously.
But what about liquidity? That's interesting and very very very
important component of all this. Yeah, that's what you you know,
(09:12):
That's that's what we're talking about. Two degrees, that that
advantage of this this stand in So I I love
what you said earlier, know what you know, the idea
that money is essentially debt. Its currency we carry around
is a debt. It's an iou that was That was
the way you said it. And the reason it works
currently is one because everybody agrees that it should and
(09:36):
two or virtually everybody agrees. Most people agree, and to
the liquidity it offers is so vastly superior to the
bartering system for the following thing. Okay, so let's say
Matt has Uh Matt is selling what kind of car
are you selling, Matt uh coon Tosh. Matt is finally
(10:00):
selling his creintage not a real car. Yeah, clearly I'm
not a car, but that is still it is creintage.
And know you decide you're going to be a car guy,
and because money doesn't exist, you're going to break into
your puka shell savings. But the problem is that you
don't live in the same town, so you have to
(10:23):
move this thing, and then you have to also let's
say it's a lot of puka how many puka shells
do you think you would That's a lot. I'm gonna
say so too many for knowl to comfortably carry, right,
you can't. You'd lose so much. You'd lose so much
(10:43):
shell just getting the shells there. So I guess what
I have to do is find some sort of financial
institution that will take my puka shells from me, put
them in some sort of puka shell storage facility, and
then give me the equivalent in let's call them Internet
moneys that can then be wired or transferred or moved
(11:04):
around electronically. Bitcomk sure, bitcomck. That's great, oh man, killing
it today, buddy, And then I can send that over
the interwebs to the place where I want to pay
to me Matt in my banking institution, which only stores
contash is right, that's that's courrect. And then they're there there,
(11:25):
and you have a very rudimentary, absurdist representation of the
way business is done these days. Right, And one of
the most important parts there is that null in this
situation will then have a representative representative token essentially of
a value or an asset that he possesses. So in theory,
(11:48):
this promotes stability in trade, and in theory, when nations
are involved in mutually beneficial trade agreements, there's more stability
in the world. Allegedly, yes, mutually beneficial. Yes, I'm just
(12:09):
gonna repeat words from that earlier sentence theoretically, So these
money systems and these debts ultimately, because that's what they are,
they can they can be great for society and help
them function and work better together. The problem is they
can also wreak massive, disastrous, sometimes even fatal things upon
(12:31):
society and individual people. Yeah, you've you may have, at
some point in your life met someone who referred to
folks who have a nine to five job as wage slaves.
That's pretty biased, But the heart of that argument harkens
back to the idea of indentured servitude. So indenture servitude
(12:55):
would be some deal um. The first one that springs
to mind is people who wanted to travel to a
different country, right, but could not afford the trip the
cost of let's say, hopping a boat across the Atlanta
But if you agree to essentially work only for room
and board for seven years, then they will consider your
(13:16):
debt paid if they're not playing a crooked game, you know, right,
And many of those games were crooked. So the argument
there would be that wage slaves, as the term goes,
our new form of indentured servitude. Uh, we're addicted to
an ivy of money, whether that's hourly salary or commission,
and we're addicted to that because we're less of a
(13:39):
value generator as an individual if we're that person, and
more of a node for debt and assets to interact.
So you that's why people can make a hundred thousand
dollars a year or who knows, who knows how high
this goes a million dollars a year and still be
(13:59):
just buy due to due to crippling debt. And then
of course that ties into you know, a similar argument
forced labor, and we can save debt or prison for
another show, because is that still a thing. It's making
come back in some places. Yeah? Wait, I thought it
had been here for years, but it's making a comeback
(14:20):
with interest here in the US. Men, is it true? Well, yeah,
it's not necessarily the same equivalent, right a debt or
prison where IO debts I can't pay them. Now I
have to go live in this cell. Actually, there's that
just a hit a story I typed in on Google
and one of the instant results was debt or prisons
(14:42):
are back? Top hit from fourteen? Is Supreme Court ruling
not enough to prevent debtor's prison? Yeah? So you can
if you have massive amounts of debt, you can go
to prison for it in certain instances. I thought that.
I think a lot of the stories too that popped
up recently, as in the last few years, occurred because
(15:03):
there were usurious court fees, legal fees, and when people
could not could not pay those fees, they would be
incarcerated until such time as those fees were paid, which
is surreal. How do you make money to when you're
hanging out in a prison all day long, every day.
(15:23):
And then of course that brings us to bankruptcy, which,
unfortunately the golden parachute, golden parachute which unfortunately too many
people are familiar with, and it works differently for the
wealthy than it does for the poor, completely differently. Anytime
you hear about a regular Joe Schmo declaring bankruptcy, they
(15:44):
have to work and scrap and save and hustle for
years to get that off their record, to get back
to a place where anyone will give them alone again.
And as we know, for certain folks that are in
the public eye right now, it's happened multiple time times
and it doesn't seem to be any long lasting ramifications
for for doing this thing. It's almost more of like
(16:06):
a business strategy. It depends Yeah, it depends on how
it is structured. And unfortunately, many people whore impoverished and
fall into bankruptcy do not have the means or the
connections to have someone help them set up these I'm
gesturing in the air right now because so much of
this stuff is an idea. It's huge, it's huge, it is.
(16:31):
And then there's another one medical bills. This is also
we're at this point, ladies and gentlemen, We're just giving
you the lay of the land of debt in the US. So,
regardless of the political stance, regardless of what television channel
is most often trying to convince you to believe something,
(16:52):
the fact remains that for the vast majority of the
city of citizens, the United States has the most inefficient
and ex spensive health care system in the developed world.
This is not just a country where people die because
a disease or a condition is incurable. This is a
country where people die because they cannot afford a treatment.
(17:17):
And for some people that is a great tragedy. For
other people, that is uh a result of the individual's
decisions and is how it is, how it goes. But
the reason we bring this up for the purposes of
this show is because medical bills in this country are
a leading cause of bankruptcy. They're leading cause of people
(17:42):
uh going into crippling debt. And we have current debt issues,
a lot of which are medically related. Yeah, when you
look at the country overall and debts that are kind
of hanging out waiting for the national government to pay.
The first one is social security, and we looked at
(18:04):
the summary of the annual report by the Social Security
and Medicare Board of Trustees, which sounds like a fun
place to work. They note that over the eighty year
history of the Social social Security program, it's collected roughly
nineteen trillion dollars and paid out sixteen point one trillion dollars,
(18:26):
leaving its asset reserves currently at two point eight trillion
at the end by the end off. Now here's here's
the problem. The ratio of reserves to one year's projected cost.
It peaked in two thousand eight, and then it's been
declining up until two thousand fifteen, and it's it's expected
(18:49):
to decline even further until they're completely depleted in twenty
four which means this money that's supposed to go to
help families with retirement, people who have disabilities, um, you know,
all kinds of issues, people that need this money to
survive that we all pay into. When you're a wage
(19:11):
worker in the US, it's just gonna be gone. And
that's something that's just kind of looming there in the
horizon that we have to think about. And the same
goes for Medicare, which is, uh, you know, dwindling quickly.
All these all these huge the huge amount of money
that are owed essentially on paper to people who once
(19:32):
they reach a certain age, needs to be paid out right. Yeah,
And the one of the issues with this is that
at various times the money for both of those programs
has been either controversially redistributed or maybe misunderestimated is a
(19:52):
good word. Misunderestimated I like that. But yeah, there it's
two serious issues that we're going to have to face
at some point. And in that group we just mentioned,
they're saying that legislation needs to be enacted sooner or
later to minimize the impact on beneficiaries human beings who
are going to need that money. So what's uh, what
(20:16):
what's the international state of debt here? Well, according to
National Debt clocks dot org. Worldwide national debt stands at
sixty trillion, nine one billion, three hundred and thirty two
million and counting. That seems like a lot of money.
It seems like mad money, made up money, imaginary money.
(20:39):
If it's the number that's too big to be real,
I mean that that sounds alarmist. But whenever I see
this stuff on paper, I'm just like, this is No
one's ever expecting to get paid back all of this money.
It's the debt itself is its own function, serves its
own function, as we've talked about, its own Financial Instruction Act,
(21:00):
you know, And that if it's fascinating to me, and
I think for some people that idea maybe makes them
more willing to go into debt because it's sort of like, well,
if if we're running a deficit as a country, why
can't I run a little bit of a deficit? Can't?
(21:20):
You should have the stuff, you know, it's something I
want to live the dream. And it's easy to get credit.
You don't have to have that much equity to get credit.
You just have to have a decent paying job and
not an absurdly low credit score. It's not hard. Well,
in this case, we're talking about countries themselves. I know
(21:41):
I'm saying perspective wise. I think when you see these
kinds of numbers and you hear about how much you
know the United States is in debt, etcetera, it almost
makes you say, well, well, hell, you know what, why
not me who cares? Right? It doesn't seem like anyone
is getting paid back, so why not just roll the
dice and emphasize is this perspective? Further, let's break it
(22:03):
down by the top owing countries in the world. Now
it's time for another breakdown. Russia hundred forty seven point
six billion, Australia point four billion, Canada eight hundred and
fourteen point seven billion, United Kingdom two point three trillion,
(22:30):
China five point four trillion, Japan eight point nine trillion.
United States all together now three trillion nine. Why did
I do a fake air horn? I guess you could
just put one in talking about that was the best
air horn I've ever heard of my life. Ben, I
(22:52):
know I'm prone to hypperbotly, but I really do believe that.
So that's a significant proportion of the overall global debt
that the US holds right there, which you know worries
me a little bit. So how does that break down
for person met going perspective? Okay, so there are three
hundred and twenty three million humans roughly in the United
(23:15):
States right now citizens, and you know nineteen point three trillion.
That amounts to just under sixty thousand dollars of national
debt per u S citizen, and it represents one hundred
and seven percent of the country's gross domestic product year
over year. So if somehow we could stop paying, stop
(23:36):
all payments on everything in this country for a year,
you know, we'd be able to pay off our national debt,
which is kind of cool. Now, let's also emphasize that
this is not the This is not the same kind
of debt that you might encounter if you have a
student loan or Absolutely, this is not the same kind
(24:00):
debt you would encounter if you purchased, um, a moped. Sure, absolutely,
And and all the numbers that we've discussed here in
in our breakdown, and the one about the the sixty
dollars per person, these are very basic, base level numbers.
And if you get deeper down in the accounting, it
(24:21):
gets it gets really tricky. And I was trying to
familiarize myself and understand it. But you guys, it's difficult, right. Uh.
None of us are classically trained economist, and we would
love to hear from any economist in the audience, would
love to hear your opinion on the state of debt.
(24:43):
Fun fact, though I am a classically trained violinist, it
is true. That is awesome. You're a man many talents.
I have a little story for for us relating to
the U S National debt. Would you like to hear
it and come at me with it? All right? Okay?
I was there was There was hesitation there, all right.
So the story comes from a guy named Jason see Linkman.
(25:07):
Jason Selingman, you see, was an economist, and he's quite
good at his job, so good in fact, that he
worked Pennsylvania Avenue, or he worked his boss lived there,
he worked for the president. That's how good he was.
And he was tortured at this time because he was
(25:30):
thinking for sixteen hours a day on this project he
was working on for his boss, a report that he
was going to write for his boss. And in that
report he ran into a realization that might stun a
(25:50):
lot of people, and he wrote with with his team
a report called Life After Debt, which they submitted to
then President Bill Clinton and which journalists got a hold
of years later through a Freedom of Information Act requests.
And Life After Debt is a report that you can
(26:14):
read it for free online. It is a report that
outlined what would happen if the US paid down its
debt to zero. And they wrote this in December of
two thousand, because that's the year the U. S. Treasury
(26:34):
began actively buying back public debt, creating um, you know,
digging its way out of the financial hole was in.
But they realized, Jason realized eventually that while there is
such a thing as too much debt for countries, there's
also such a thing as too little debt. So countries
(26:57):
don't want to necessary rely have a surplus. In many
cases it's unreasonable outside of you know, a few a
few countries like the like Nordic countries, un some oil
oil wealth countries. So what we see is that the
(27:18):
international level understanding of debt and the individual levels to
understand debt is different. Not all debt is created equally.
Businesses will go into debt and have specialized, custom fit
or bespoke plans for balancing that debt. However, someone who
(27:42):
was built into a series of high, high interest credit
cards or student loans will often not have that sort
of recourse. Here in this country, there are federal programs
that are so opposed to provide assistance for people who
(28:04):
have the misfortune of not being a business or a
country when they go into debt. However, much more money
is spent by the folks who make money off of
credit cards and student loans to make sure that system continues.
And as of now, debt what we've explained so far, Yes,
(28:25):
there is an inequality of debt. Not all debt is
created equal, not all people are in debt. But debt
is a problem for a lot of individuals, especially here
in the West. But the truth of the matter is
debt makes the world go round. So we were asking
ourselves a few weeks back, what would happen if we
(28:47):
woke up one day and all of the debt disappeared.
We'll find out right after a quick message from our sponsor.
Here's where it gets crazy. All right, everyone, it's story time.
(29:10):
Let's imagine a scenario where this actually happened, where where
through some act of massive buffoonery, sorcery. It's not something
insane happened, and Mr Noel Brown wakes up in a
world free from debt. Ah, I can hear how relax
(29:35):
he is exactly look at this world free from debt. Yeah. Well,
the great news is if he had any student loans,
medical bills, credit cards, mortgage to automatically, he'd be in
the clear for all those debts. It's gone. What a
time to be alive, guys. So so what what we do?
Of course he would take some he would want to
(29:57):
get to take some cash, get on that first dream
trip with his you know, his honey, his squeeze, his
girl every and uh, naturally they would go to Borneo.
That would go to Borneo, and go to Borneo. But wait,
there would be some problems here. Oh, to get the
tickets to Borneo, Noel Brown has to buy them, and
(30:20):
the debit card he tries to use to buy the
ticket doesn't work because the bank that runs that debit
card is in a tail spin because debt no longer exists.
And the dirty open secret about banks, I don't know
if it's necessarily call it dirty, it's just how they work.
Is that the money in Noel Brown's account was used
(30:41):
to be a loan to someone else. Yeah, Rain Capital
used it to invest in a small company in Atlanta
or something like that. Yeah, And that's when that's when
Noel Brown has to explain to this woman that he
loves he was going to take it on a magical
romantic get away to Borneo. Why they can't go to Borneo?
(31:04):
And he gives her his following speech. Well, you see,
as it turns out, most of the money in the
world is really just someone else's debt. Yeah. The money
in your bank account, my bank account, our joint bank
account because we're in love, is mostly on loan to
(31:24):
other people. Why. Yeah, the bank they took our money
and they used it to give someone else a car loan,
to give someone else a home loan, to give someone
else a loan to buy a suite new computer. Oh
(31:45):
but wait, there's more. There's an upside here for the banks. Yeah,
they get to use some sneaky accounting, very tricksy accounting,
and by doing that they don't have to hold every
one's money all of the time. It's a it's sort
of a game of you know, back and forth. It's
(32:06):
being moved around all over the place. They just hold
some of the money, and by some we're talking a
tiny fraction. So at the height of the financial crisis
in two thousand seven, many banks were actually leveraged at
a ratio of thirty to one. Then, can you clarify that? Yes,
(32:28):
So in this scenario, I've I've showed up at Noel's
house and he's explaining to the love of his life
they can't go to boardio. Well know, we're at the airport.
Oh you're at the airport. Oh okay, alright, cool, Now
I feel underdressed because I'm obviously in my jammie's. But
I only go to the airport in my jammie's. I
(32:49):
think that's the only time I've ever said the word jammies. Alright,
rule of three. So to clarify, Noel Brown, in his
moving tragic speed, will be telling this this uh love
of his life and whomever else is going to go
with them, that his bank account and all bank accounts
(33:09):
are essentially emptied unless the bank magically replenishes the account,
which would throw things into chaos. But you know, it
is a series of key strokes on a computer screen.
At least we have the fdi C that ensures up
to a certain amount, right, right, But a bank no
longer has a reason to exist as its sole purpose
(33:30):
for from this perspective, is to move debt around every
stock exchange. While Noel Brown is delivering this speech in
Hartsfield Airport, I imagine you're in Hartsfield, of course. Okay, Uh,
every stock exchange closes, Noel's investment portfolio is wiped out.
The puka shells he still has, but any puka shell futures,
(33:54):
any uh puka shell short short stocks, And I'm just
making upwards. Yeah, I'm gonna I'm gonna need that countosh back. Sorry,
I hope you don't mind, because an investment is just
funding someone else's debt with the promise or the hope
of getting more back in return, but no one will
pay you back. And also, uh, Noel and his sweeties
(34:16):
retirement funds, they have one along with everybody else's. Also
poof vanish. There's a guy named Thomas Dalton who I
think described this really well. What would happen if lenders
wrote off all debts he sets is that there would
be a massive transfer of wealth from net lenders to
net borrowers. The net lenders of the world are things
(34:40):
like governments right uh, and young adults are We are
often net borrowers, and those close to retirement are often
net lenders because pension funds invest by lending at least
some of the money out. So what would happen if
debt was erased would be a massive transfer of well
from the old to the young and to governments. And
(35:04):
Dalton also says we can make a mistake by thinking
of this as a transfer of wealth from the rich
to the poor, but it wouldn't work that way because
the very poor don't usually have much debt. No one
is willing to lend to them. It's only those with
large incomes or assets or potential incomes that build up
significant debt. So depending on what governments do now that
(35:24):
they're free from paying interest on their debts, they were
never going to actually pay back the debts, so it's
just the interest. The poor might benefit from extra government spending, however,
it might be the rich that benefit from tax cuts.
Pensioners and those who are getting to retirement age would
have some serious difficulties. The super wealthy, says Dalton, may
(35:45):
lose some money, but they usually invest in equity rather
than debt. So since the companies they own often have
a lot of debt, the share prices would probably increase enormously,
assuming of course, that the stock market would still be around,
which is debatable. And then he said, in addition, institutional
lenders would all be bankrupt, banks, insurance companies, pension funds,
(36:06):
the world economy would probably collapse, and to be honest,
everyone would suffer erasing all debt. This that that's his quotation.
In our opinion, a racing all debt is the nuclear
weapon of economic warfare, which sounds kind of heady until
we realize that economic warfare already exist today. It's occurred
in the past. We've talked about it a little bit
(36:28):
before with a guy named John Perkins who wrote a
book called Confessions of an Economic hit Man, and what
she says he worked for an engineering company in Boston,
and his job was to convince leaders of underdeveloped countries
to accept development loans for construction and engineering projects, and
having a condition of those loans be that the projects
(36:50):
went to US companies, and these loans would later give
the US government influence and access to natural resources. And
we have a quote from the book that we're going
to read here. Economic hitmen are highly paid professionals who
cheat countries around the globe out of trillions of dollars.
They funnel money from the World Bank, the US Agency
for International Development, and other foreign aid organizations into the
(37:14):
coffers of huge corporations and the pockets of a few
wealthy families who control the planets and natural resources. Their
tools included fraudulent financial reports, rigged elections, payoffs, extortion, sex,
and murder. They play a game that is old as empire,
but one that has taken on a new and terrifying
dimension during this time of globalization. And this is something
(37:38):
we've explored before. Uh often referred to as resource extraction.
So that's one example of how economic warfare could work,
and that would pale in comparison to the economic warfare
of erasing all debt, regardless of the intention behind it.
Erasing on that would be strange. But how how could
(38:00):
this We're talking about the ideas, right, and we've talked
about the numbers of debt, But let's talk about how
this could work. How could someone a race debt well
to do this? We look at some examples from pop culture,
because that's really the only place where this has been
(38:21):
fully explored. Yeah, and there's some fun ones, and I
mean it's it's like one of the ones that comes
to mind, UM that we haven't explicitly discussed together is
the movie Escape from l A, where at the end
they we are going to get into some spoiler territory here.
You also, if we're mentioning a movie or something and
you don't want to know what happens, you should probably
(38:41):
skip ahead maybe seven minutes or so, or you know,
go back ten years and watch Escape from you know,
it's it's on it's on the Netflix. I think you
can get it. But at the end of Escape from
l A, there's a device that essentially shuts down all electricity.
It's down even batteries. They make a point in it
(39:02):
to say like, oh, this will even like render all
batteries useless. And yeah, so this is sort of like
a super extreme version where it's like an all encompassing
attack that would not only get rid of all dead
as we know it, but pretty much reduced you know,
humanity too, back to the dark Age as we need
to you know, start over. But a really good one
that does specifically deal with UM actually targeting financial Corporations.
(39:25):
Is Fight Club nine, David Fincher film based on the
novel by Chuck palinak Um. There are some pretty significant
differences between the novel and the and the film, but
they do a pretty good job of having a very
similar let's say, mission statements. So in Fight Club, um,
they're the group of these kind of project yeah, project mayhem,
(39:49):
that's right, sort of a bunch of like depressed, overly
macho males, middle aged. Yeah. They want to fight back
because they feel like they've been marginalized as by society.
They are angry. Um. Honestly, their motivations are not particularly
um positive. They're not really trying to help anybody. They
(40:09):
just kind of want to watch the world burn a
little bit um in my opinion. That's that's what I
take from it. But in order to do this, they
stage an attack what could reasonably be considered a terrorist
attack on the corporate headquarters of several large credit card companies.
I think there seven buildings that are destroyed during the
en scene, which to me is such an iconic scene,
(40:30):
and it's the first place I ever heard the Pixies
uh song where is My Like who is this band?
And then I you know, I was down a rabbit hole.
From then on here we are so Um. Even at
the time, I always thought this was sort of a
little bit of a rudimentary example of wiping out the debt,
(40:50):
because it's like, surely these things are backed up elsewhere,
you know, not just in the building, And by blowing
up a building alone, you're not white being out the debt.
It would require some sort of deep infiltration of an
entire file system and structure and network, getting much more
into hacker territory before we get there, though, little bit
(41:13):
of an interesting fact toy that Matt turned me onto. Um,
did you guys know that in the novel Fight Club
it takes place in Wilmington's, Delaware. Do you guys remember
twelve o nine North Orange Street, the Corporation Trust Center,
the official address of over two companies, Willington, Delaware. Um,
(41:37):
there's a couple of little inklings in the film that
it takes place there as well. But I thought that
was a pretty clever non And this address keeps popping
up for us. We're gonna have to do. I think
we're gonna have to do like a whole episode this address.
Let's take it. Let's let's go there physically, listeners, let
us know if you was to go there, maybe we
can meet up to hang out. So, like I said,
(41:58):
I mean, I don't feel like this sample holds up.
This is more of sort of an anarchist kind of
like I said, watch the World burn kind of thing.
But um, we have we have a really good example
in our our wonderful sponsors. As it turns out, Mr
robot Um the series involving a sort of anonymous esque
(42:18):
society of hackers called f Society who orchestrates a very
high level cyber attack against E Corp, which to me
is I think a very clever stand in for Enron
maybe or like any other giant corporation or financial financial
levels or something. Sure. Um, and to me, this is
this is how you would you would do this. If
(42:40):
you were going to attempt to do some kind of
to orchestrate some kind of complete erasure of the debt record,
it would have to be through infiltrating these systems, not
just blowing up a building or one computer or one
set of servers. Yeah, and they and they do. Uh,
I guess it's a two pronged attack in there may
even be more than that that we just don't understand,
(43:03):
uh as viewers and you know, in the world of
Mr Robot. But they do it by using this thing
called Interpreter, which is a meta saploite backdoor. And the
main character, Elliott, goes into the main servers of e Corp,
installs a really simple program like an e x C
(43:23):
file on their server, which then gives them and and
easy to access back door to the servers so they
can go in. It's crazy. It uses memory, so it's
not actually writing anything to disk, it's just using the
RAM on the on the machine to create this backdoor.
I don't pretend to understand the hacking tools, but according
(43:44):
to numerous people online who are actually in the info
sex space and all this, they're saying that, yes, this
is this is real. You could do this and you
could delete information if you had this kind of backdoor.
And like I've said about the show, I mean it
definitely gets a lot of this stuff right. Even like
the when you see the dude doing his hacking, it
(44:04):
looks like command line things instead of some sort of
bizarrow like three D rendering of the Internet as it
would be if you were floating around and hackers or something. Yeah,
I was thinking of that nineties film Hackers as well.
Uh so what would be hit in these things? Insurance companies, Banks.
(44:25):
Insurance companies are bigger depositories of this kind of value
than you might think. There would also, of course, be
government institutions. This would be stuff like this would have
to involve treasuries as well as mints. This, this would
involve a simultaneous attack on thousands of things. Would be
(44:51):
very difficult to do. It also makes me wonder as
a little off, But it also makes me wonder if
someone had that power, why stop at debt? Why not
also erase repositories of personal information so like medical info? Uh,
you know the metadata that the National Snooping Administration collects
(45:17):
from you the Facebook servers. Yeah, and we talked a
little bit about the attack strategies. I think when you
mentioned the escape from l a scenario of effectively cutting
off electronics stuff. Right, what does this What does this
(45:38):
cloud money mean if we cannot access the cloud? Yeah,
if you would have to kill electricity indefinitely in order
to make that work, because there are you know, all
of these huge institutions like Iron Mountain that holds sensitive
data like this they've got him like crazy generators and
backup power and all this other. Not to mention, they
(45:58):
keep backups on like physical tapes and you know, like
stuff that would stand the test of time and a vault,
you know, and they're constantly updating these things and backing
up all their all their data. So yeah, absolutely, in
the old days of my family, it was very different. Uh,
there were things that would happen when somebody wanted to
(46:21):
get and we wanted information to disappear. And mean, think
about it. We live in a time where just less
than what a hundred years ago, even up to the
nineteen seventies eighties, if a right definitely sixties or so,
(46:45):
if a bank or a courthouse burned, then there would
be no evidence of debt or arrests or records. There
were people in my family were not true when they
were born because yeah, because someone burned a courthouse or two. Yeah,
and uh this I mean, but we no longer live
in that world because there are multiple copies of these records,
(47:09):
which leads us to why it probably wouldn't work if
we're talking about global debt records. Yeah, so in the
world of Mr Robot, it does work. Um, and that's
because Ecorp. Evil Corp. Owns roughly se of the consumer
credit industry, which is a bit hard to fathom. In
our world, it means they would just own as subsidiaries
(47:31):
let's say Capital One and most of the Visa other
companies that use Visa or MasterCard or any of those.
I feel like, in theory we have laws in place
to prevent things like that from happening. Well, you know,
hopefully it doesn't happen in the future for us, you know,
But but in our world it's and this is not debatable.
These various industries, from credit cards, mortgages, student loans, health insurance,
(47:56):
all of these are controlled by hundreds and hundreds of
separate compe eating companies. Like you said earlier, Ben, and
you would have to I mean, you would have to
strike at a huge number of locations in order to
make this happen. Um. In fact, almost all the computers. Um.
And Okay, so let's say you were able to take
out a single huge international credit card company. Look, I'm
(48:18):
just using Capital One. Sorry, capital I'm just using it
because I have your credit card. Um, it would be
this tiny, itsy bitsy little dent in the all encompassing
global debt machine that exists all around us, right, and
there's so many eyes watching this as well. There are multiple,
multiple international, state level and even local institutions that are
(48:43):
tasked with doing this. But then there's another thing, which
is uh. Many countries maintain a reserve of actual resources
rather than just currencies. So the US has you've probably heard,
a strategic reserve of petrol. Uh, the US has strategic
reserves of valuable metals, right, And other countries do the
(49:07):
same thing. And then we have other reserves of other
people's currencies. So if you hit one country, then the
currency that didn't get hit, that money will just become
more valuable. So think of these reserves as massive savings accounts.
They fluctuate as spending is needed. Uh. In some countries,
those reserves are uh dwindling, these currency reserves. Right. So
(49:31):
here's just a few examples. And some countries these reserves
are dwindling. You're getting low. According to the World Bank,
the US had five hundred and seventy four billion in
total reserves in the reserves fell below a hundred and
seven billion UM. But in other countries these reserves are
actually skyrocketing. In two thousand, China held a hundred and
(49:54):
seventy two billion, and that's in US dollars correct, And
in China's reserves jumped to a whopping three point three
four trillion, yes, trillion. And there are numerous reasons behind this. Uh.
Some have to do with the importance of one currency
versus another or treasury bonds. Another has to do with
(50:17):
trade versus currency or trade balance, and overall strategies of
where you're where you're going with your country. And it's
it's a fascinating thing that I think, Ben, maybe we
should look at in the future. Okay, yeah, I agreed. Uh.
And especially if this interest you, ladies and gentlemen, we
we can cover it. There's the other, the other factor
(50:38):
here that disaster recovery data backups. Something happens. Let's say
there is an attempt, well, the Mr Robots scenario, as
they said, for makes a little more sense than to
demolish the building's plan and fight club, because they're targeting
servers as well as backup data stores. And these things
(50:58):
have started to become common place in the nineties seventies
when people began to realize how um Matt you described
it best. When we said, insanely dependent we are we
as a species become on computers and the data contained
within those. So the strategies are redundancy plus off site
and cloud storage. The records of what is what and
(51:22):
when exists in multiple places, uh, which is also strange
because that kind of thing that not omnipresence but I
guess by location, is one of the miracles sometimes attributed
to saints. So going back to our earlier thing about
(51:42):
modern mythology, in a way, through robotics were through electronics
and computing, we are once again building the miracles of old,
but in a very strange way. So when we're looking
at this, the question is what is the stuff they
don't want you to know? More immediately? Who are they? Well,
(52:04):
at this point we can say we we feel we
feel pretty secure, saying that. One of the problems with
learning objectively about everything from individual finance to the financial
food fight that is international relations, uh and food fight
(52:26):
being you know, an allusion to the resources. Uh. The
what what we're seeing is that it's tough to learn
this because the people who can teach you have agendas.
So you learned this first, Huh, Well, the people who
can teach you will have agendas and that you know,
naturally I can tie into almost anything that we learn.
(52:50):
You know, somebody who is an Egyptologist is going to
have a very different opinion about the importance of Egypt
and civilization. Right. Sure, but in this case the stakes
are high and their currency, right. And I mean, of
course we're not denigrating Egypt, which is enormously influential. But
(53:11):
but but yeah, maybe archaeology is a bad comparison. I
think that's that's a great point though. If you ask
uh uh an economist from the US versus an economist
from China and economists from Russia or Iran, you're going
to receive different answers. And they're not necessarily the wrong
(53:33):
answers from that economist, they're the they're the answers that
most benefit that perspective. Right. And this means that in
our conversations Noel, Matt and I may have different perspectives,
It doesn't This is a case where if we disagree,
it doesn't mean one of us is wrong. Well, let's
(53:53):
get down to it. I mean, at the end of
the day, economics isn't an exact science. There are different
school of thought that are deep rooted in older schools
of thought, you know, and uh, like you said, just
because one person has a particular perspective doesn't necessarily mean
they're wrong, and the true answer might be somewhere in
(54:14):
between combining different perspectives. There's a pophy. There's a lot
of philosophy. Always use ideogy exactly, but it's it's very
it's not I don't want to say that it's imprecise.
I think that's that's short selling it just a little bit,
because I mean, obviously there is a lot of detailed,
high level thinking that goes into this, but it's much
(54:35):
more like a theory, you know, than it is a formula.
We also did not we also haven't looked at what
would happen if a concentrated segment or type of debt
were a race. If just for instance, just more how
specific do we want to go. Gent's just mortgages on
(54:57):
ranch style homes are just wiped out, Like what would that?
That would still have a ripple, less of an effect,
but it would still happen. I thought it would have
a ripple. If you know, all loans for any kind
of watercraft, you know, like a sailboat or a jet
ski it would have many ripples. I think I was
(55:19):
worth it. Or so, we we've talked a little bit
about the consequences, the the they the stuff they don't
want you to know. For this episode, the stuff will
be the state of economy, debt in the world, affecting
individual debt, an individual debt affecting the action of states,
(55:41):
the and the existence of currency. Yeah, you know, is
it just? Is it truly just? And I owe you?
Is it simply a system of coupons that future historians
will find, uh will put on the par of lost religions? Right?
I mean that's an extreme point of view, and that's
(56:02):
an extreme way to phrase that question. But what do
you think, ladies and gentlemen. We we spent some time
on this one, so we're going to head out of here,
but we would like to hear from you any stories
you have that you think more people should know about debt,
whether individual or international. What you think, if anything could
(56:24):
be changed to fix this or is this perfect the
way it is? Most importantly, do you think the world's
debt should be a race despite the frankly certain and
inevitable consequences, Because I'll say my personal perspective here even
if there were some kind of financial kill switch, a
(56:46):
reset button that would take debt to zero, Eventually debt
would a system of debt would evolve. Puka Shells. You
are on the ground floor, my man. So you can
let us know your thoughts on Facebook and Twitter. You
can also follow us on Instagram where conspiracy stuff on
(57:07):
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(57:27):
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(57:48):
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From UFOs to psychic powers and government conspiracies. History is
riddled with unexplained events. You can turn back now or
learn the stuff they don't want you to know. Hello,
(00:20):
welcome back to the show. My name is Matt, my
name is Noel, and Ben your you and if you
are one of the people who happens to live in
the United States, and you're an average household then you
have around one hundred thirty thousand, nine hundred and twenty
two dollars in debt, and of that, fifteen thousand, seven
(00:42):
hundred sixty two dollars can be attributed to credit cards.
Holy mackerel, We're starting off on a positive note today,
my friends. You know what I think. Again, this is
the second time I've been slightly below average the same,
you know, but it's it doesn't feel great. Oh wait, no,
I am way above average. You got to count the house.
(01:07):
Uh if you count mortgage, that's interesting. Okay, well then
I'm well above average then, But it doesn't The mortgage
kind of count as as an investment. I mean that
it depreciates over time, so it's not quite the same
as being in debt. But I guess it's looked at
that way as by creditors. Yeah, it feels that way
now now that I'm thinking about it. And uh, you know,
(01:28):
the reason that there's so much debt has been uh
talked about at length for a long time by so
many people. We often, we being the majority of the
public across the globe, we often don't have the best
(01:49):
or most sophisticated understanding of what this is. And that's
why we as a species become embroiled in these strange
situations sometimes when all of a sudden, like consider the
Great Depression, Right, people are starving in the cities, right,
But in the rural Midwest and the farming country, farmers
(02:13):
are throwing milk away and just gutting pigs and saving
what they can because the price on those animals and
that you know that that beverage, I guess has tanked.
Some feels weird about calling milk a beverage, but basically
what I'm saying like, that's and and then the reason
people would come to find that folks were starving in
(02:33):
one place when people were trashing resources in another was
due to something called the economy, right and right, and
then people would say, people would uh, the pundits would
be on the radio. The populist, the nationalists, the whomever
is would be on the radio arguing why they alone understood, uh,
(02:54):
the one true economy or what that thing should be.
And now we're in a world where I guess I
want to start off with a question. So did you
guys have economics classes in high school or in middle school?
I did, but I felt like I feel like it
was rolled into something else, or it was like we
(03:15):
got half an economics class and then like the other
half was was Civics or something like that. You know,
but my memory of those days is a little hazy.
That's maybe that's made up. I got home ec Yeah,
I took not the same thing. No, I mean it
was personal finance. It was personal finance. It was all
It was all that kind of stuff like how to
(03:36):
how to manage your your stuff, But it didn't teach
you how the FED worked, No, and I how to
how to write a check effectively? Right? What are the
things that I always think about? Is you know you're right, Matt.
For many people, at least in this country, the closest
thing people were offered to a personal finance class in
(03:56):
a public school is going to be home economics. However,
the individual person would probably be in a much better
position today if personal finance classes were mandatory. And I
know people don't like big brother federal mandates, but that's
an individual education, that is that is necessary to survive,
(04:19):
a lot of people don't get that, and that's why
we end up in a country where the total debt
oh by US consumers. I can break it down, all right, Uh,
let's see now it's time for a breakdown. Right. Oh gosh,
youa So what's the pressing one? Do we have a
backbeat for this? Oh? Yeah, okay, So credit cards seven
(04:45):
hundred thirty three billion dollars pales in comparison, of course,
to auto loans one point oh eight trillion dollars. And
then we have student loans one point to three trillion dollars,
(05:07):
and finally mortgages eight point to five trillion dollars. So
all of these numbers, these massive numbers, this is debt
um It's money that I guess needs to be paid.
(05:28):
What is debt? Exactly? It's called American dream dollars. Oh,
as in imaginary dollars, which is this episode today we
are talking about that, and that I'm I'm laughing, because no,
what you just said ties into so many other episodes
we could do. It hit us in our the course
(05:50):
of our research before we went on the air this week.
That currency itself is just a fascinating weird thing. It's
an agreement. We make it totally is It's like it
could be shells, you know, good shells, or or or
a handful of sand. When you were a kid, did
you ever play the game where you just all agreed
that the floor was lava. It's like that, but with prizes,
(06:13):
and you can move the floor for a bunch of people.
I know that's that's a very biased thing, but well, yeah,
what is what is debt? That that's the question we
start with today, even though it's not our ultimate question.
So the good, the bad, the ugly of debt, Well,
it does do some oh nice copyright. Oh was that
(06:40):
Ineo Morricone? Oh man, he's the master my favorite soundtrack.
I'm gonna go listen to that for the rest of
the weekend. But the good part about debt, and there
are good parts, is that it sort of makes the
world go round. What are some of the good things
that this debt system does? So in the most bay
sick of terms debt is it's it's an I O U.
(07:03):
I mean it's without going into the entire history of
currency and money. As we know, at one time they
used peppercorns. Peppercorns or currency that's got a function. It
makes your food nice and spicy. But you know, I
mean many forms of currency were redeemable I O U S.
I mean that is essentially what currency boils down to,
is the redemable IOU for a good or service, either
(07:24):
physically they contain some sort of valuable material a metal, gem,
what have you, pooka shell, whatever, um or they were
redeemable for the same amount of a different material. Okay, yeah,
So like an example for folks in the U. S
And I know our numbers are pretty US centric at
(07:45):
this point, but we can get bigger. Uh. In the US,
there were these things called silver certificates, which UH fans
of certain JFK assassination theories will be familiar with. And
until nineteen before these silver certificates legally could be redeemed
for the amount of silver that was mentioned on the currency,
(08:07):
and then they stopped. Yep. But the reason, the reason
why money, why currency is so important to the functioning
of society is that all the goods and services that
are available for trading in some way or another, they
get boiled down to this common denominator where you have
X amount of this and I want to give you this.
(08:30):
I have X amount of this. I want to give
you this. We can trade with this one thing, rather
than having to break down exactly how much a goat
is worth in terms of wheat or something like that,
or you know, a car in terms of the shelves
or T shirts or something strange. Yeah, yeah, know why
I'm hung up on puka shelves. I think I think,
(08:51):
you know, maybe you could bring it back. I think
it's because I went to that widespread Panic concert last
night and I saw a lot of those. Yuh, I
got a text from you. The three am was just
an animated gift of a puka shell dancing furiously, dancing furiously.
But what about liquidity? That's interesting and very very very
important component of all this. Yeah, that's what you you know,
(09:12):
That's that's what we're talking about. Two degrees, that that
advantage of this this stand in So I I love
what you said earlier, know what you know, the idea
that money is essentially debt. Its currency we carry around
is a debt. It's an iou that was That was
the way you said it. And the reason it works
currently is one because everybody agrees that it should and
(09:36):
two or virtually everybody agrees. Most people agree, and to
the liquidity it offers is so vastly superior to the
bartering system for the following thing. Okay, so let's say
Matt has Uh Matt is selling what kind of car
are you selling, Matt uh coon Tosh. Matt is finally
(10:00):
selling his creintage not a real car. Yeah, clearly I'm
not a car, but that is still it is creintage.
And know you decide you're going to be a car guy,
and because money doesn't exist, you're going to break into
your puka shell savings. But the problem is that you
don't live in the same town, so you have to
(10:23):
move this thing, and then you have to also let's
say it's a lot of puka how many puka shells
do you think you would That's a lot. I'm gonna
say so too many for knowl to comfortably carry, right,
you can't. You'd lose so much. You'd lose so much
(10:43):
shell just getting the shells there. So I guess what
I have to do is find some sort of financial
institution that will take my puka shells from me, put
them in some sort of puka shell storage facility, and
then give me the equivalent in let's call them Internet
moneys that can then be wired or transferred or moved
(11:04):
around electronically. Bitcomk sure, bitcomck. That's great, oh man, killing
it today, buddy, And then I can send that over
the interwebs to the place where I want to pay
to me Matt in my banking institution, which only stores
contash is right, that's that's courrect. And then they're there there,
(11:25):
and you have a very rudimentary, absurdist representation of the
way business is done these days. Right, And one of
the most important parts there is that null in this
situation will then have a representative representative token essentially of
a value or an asset that he possesses. So in theory,
(11:48):
this promotes stability in trade, and in theory, when nations
are involved in mutually beneficial trade agreements, there's more stability
in the world. Allegedly, yes, mutually beneficial. Yes, I'm just
(12:09):
gonna repeat words from that earlier sentence theoretically, So these
money systems and these debts ultimately, because that's what they are,
they can they can be great for society and help
them function and work better together. The problem is they
can also wreak massive, disastrous, sometimes even fatal things upon
(12:31):
society and individual people. Yeah, you've you may have, at
some point in your life met someone who referred to
folks who have a nine to five job as wage slaves.
That's pretty biased, But the heart of that argument harkens
back to the idea of indentured servitude. So indenture servitude
(12:55):
would be some deal um. The first one that springs
to mind is people who wanted to travel to a
different country, right, but could not afford the trip the
cost of let's say, hopping a boat across the Atlanta
But if you agree to essentially work only for room
and board for seven years, then they will consider your
(13:16):
debt paid if they're not playing a crooked game, you know, right,
And many of those games were crooked. So the argument
there would be that wage slaves, as the term goes,
our new form of indentured servitude. Uh, we're addicted to
an ivy of money, whether that's hourly salary or commission,
and we're addicted to that because we're less of a
(13:39):
value generator as an individual if we're that person, and
more of a node for debt and assets to interact.
So you that's why people can make a hundred thousand
dollars a year or who knows, who knows how high
this goes a million dollars a year and still be
(13:59):
just buy due to due to crippling debt. And then
of course that ties into you know, a similar argument
forced labor, and we can save debt or prison for
another show, because is that still a thing. It's making
come back in some places. Yeah? Wait, I thought it
had been here for years, but it's making a comeback
(14:20):
with interest here in the US. Men, is it true? Well, yeah,
it's not necessarily the same equivalent, right a debt or
prison where IO debts I can't pay them. Now I
have to go live in this cell. Actually, there's that
just a hit a story I typed in on Google
and one of the instant results was debt or prisons
(14:42):
are back? Top hit from fourteen? Is Supreme Court ruling
not enough to prevent debtor's prison? Yeah? So you can
if you have massive amounts of debt, you can go
to prison for it in certain instances. I thought that.
I think a lot of the stories too that popped
up recently, as in the last few years, occurred because
(15:03):
there were usurious court fees, legal fees, and when people
could not could not pay those fees, they would be
incarcerated until such time as those fees were paid, which
is surreal. How do you make money to when you're
hanging out in a prison all day long, every day.
(15:23):
And then of course that brings us to bankruptcy, which,
unfortunately the golden parachute, golden parachute which unfortunately too many
people are familiar with, and it works differently for the
wealthy than it does for the poor, completely differently. Anytime
you hear about a regular Joe Schmo declaring bankruptcy, they
(15:44):
have to work and scrap and save and hustle for
years to get that off their record, to get back
to a place where anyone will give them alone again.
And as we know, for certain folks that are in
the public eye right now, it's happened multiple time times
and it doesn't seem to be any long lasting ramifications
for for doing this thing. It's almost more of like
(16:06):
a business strategy. It depends Yeah, it depends on how
it is structured. And unfortunately, many people whore impoverished and
fall into bankruptcy do not have the means or the
connections to have someone help them set up these I'm
gesturing in the air right now because so much of
this stuff is an idea. It's huge, it's huge, it is.
(16:31):
And then there's another one medical bills. This is also
we're at this point, ladies and gentlemen, We're just giving
you the lay of the land of debt in the US. So,
regardless of the political stance, regardless of what television channel
is most often trying to convince you to believe something,
(16:52):
the fact remains that for the vast majority of the
city of citizens, the United States has the most inefficient
and ex spensive health care system in the developed world.
This is not just a country where people die because
a disease or a condition is incurable. This is a
country where people die because they cannot afford a treatment.
(17:17):
And for some people that is a great tragedy. For
other people, that is uh a result of the individual's
decisions and is how it is, how it goes. But
the reason we bring this up for the purposes of
this show is because medical bills in this country are
a leading cause of bankruptcy. They're leading cause of people
(17:42):
uh going into crippling debt. And we have current debt issues,
a lot of which are medically related. Yeah, when you
look at the country overall and debts that are kind
of hanging out waiting for the national government to pay.
The first one is social security, and we looked at
(18:04):
the summary of the annual report by the Social Security
and Medicare Board of Trustees, which sounds like a fun
place to work. They note that over the eighty year
history of the Social social Security program, it's collected roughly
nineteen trillion dollars and paid out sixteen point one trillion dollars,
(18:26):
leaving its asset reserves currently at two point eight trillion
at the end by the end off. Now here's here's
the problem. The ratio of reserves to one year's projected cost.
It peaked in two thousand eight, and then it's been
declining up until two thousand fifteen, and it's it's expected
(18:49):
to decline even further until they're completely depleted in twenty
four which means this money that's supposed to go to
help families with retirement, people who have disabilities, um, you know,
all kinds of issues, people that need this money to
survive that we all pay into. When you're a wage
(19:11):
worker in the US, it's just gonna be gone. And
that's something that's just kind of looming there in the
horizon that we have to think about. And the same
goes for Medicare, which is, uh, you know, dwindling quickly.
All these all these huge the huge amount of money
that are owed essentially on paper to people who once
(19:32):
they reach a certain age, needs to be paid out right. Yeah,
And the one of the issues with this is that
at various times the money for both of those programs
has been either controversially redistributed or maybe misunderestimated is a
(19:52):
good word. Misunderestimated I like that. But yeah, there it's
two serious issues that we're going to have to face
at some point. And in that group we just mentioned,
they're saying that legislation needs to be enacted sooner or
later to minimize the impact on beneficiaries human beings who
are going to need that money. So what's uh, what
(20:16):
what's the international state of debt here? Well, according to
National Debt clocks dot org. Worldwide national debt stands at
sixty trillion, nine one billion, three hundred and thirty two
million and counting. That seems like a lot of money.
It seems like mad money, made up money, imaginary money.
(20:39):
If it's the number that's too big to be real,
I mean that that sounds alarmist. But whenever I see
this stuff on paper, I'm just like, this is No
one's ever expecting to get paid back all of this money.
It's the debt itself is its own function, serves its
own function, as we've talked about, its own Financial Instruction Act,
(21:00):
you know, And that if it's fascinating to me, and
I think for some people that idea maybe makes them
more willing to go into debt because it's sort of like, well,
if if we're running a deficit as a country, why
can't I run a little bit of a deficit? Can't?
(21:20):
You should have the stuff, you know, it's something I
want to live the dream. And it's easy to get credit.
You don't have to have that much equity to get credit.
You just have to have a decent paying job and
not an absurdly low credit score. It's not hard. Well,
in this case, we're talking about countries themselves. I know
(21:41):
I'm saying perspective wise. I think when you see these
kinds of numbers and you hear about how much you
know the United States is in debt, etcetera, it almost
makes you say, well, well, hell, you know what, why
not me who cares? Right? It doesn't seem like anyone
is getting paid back, so why not just roll the
dice and emphasize is this perspective? Further, let's break it
(22:03):
down by the top owing countries in the world. Now
it's time for another breakdown. Russia hundred forty seven point
six billion, Australia point four billion, Canada eight hundred and
fourteen point seven billion, United Kingdom two point three trillion,
(22:30):
China five point four trillion, Japan eight point nine trillion.
United States all together now three trillion nine. Why did
I do a fake air horn? I guess you could
just put one in talking about that was the best
air horn I've ever heard of my life. Ben, I
(22:52):
know I'm prone to hypperbotly, but I really do believe that.
So that's a significant proportion of the overall global debt
that the US holds right there, which you know worries
me a little bit. So how does that break down
for person met going perspective? Okay, so there are three
hundred and twenty three million humans roughly in the United
(23:15):
States right now citizens, and you know nineteen point three trillion.
That amounts to just under sixty thousand dollars of national
debt per u S citizen, and it represents one hundred
and seven percent of the country's gross domestic product year
over year. So if somehow we could stop paying, stop
(23:36):
all payments on everything in this country for a year,
you know, we'd be able to pay off our national debt,
which is kind of cool. Now, let's also emphasize that
this is not the This is not the same kind
of debt that you might encounter if you have a
student loan or Absolutely, this is not the same kind
(24:00):
debt you would encounter if you purchased, um, a moped. Sure, absolutely,
And and all the numbers that we've discussed here in
in our breakdown, and the one about the the sixty
dollars per person, these are very basic, base level numbers.
And if you get deeper down in the accounting, it
(24:21):
gets it gets really tricky. And I was trying to
familiarize myself and understand it. But you guys, it's difficult, right. Uh.
None of us are classically trained economist, and we would
love to hear from any economist in the audience, would
love to hear your opinion on the state of debt.
(24:43):
Fun fact, though I am a classically trained violinist, it
is true. That is awesome. You're a man many talents.
I have a little story for for us relating to
the U S National debt. Would you like to hear
it and come at me with it? All right? Okay?
I was there was There was hesitation there, all right.
So the story comes from a guy named Jason see Linkman.
(25:07):
Jason Selingman, you see, was an economist, and he's quite
good at his job, so good in fact, that he
worked Pennsylvania Avenue, or he worked his boss lived there,
he worked for the president. That's how good he was.
And he was tortured at this time because he was
(25:30):
thinking for sixteen hours a day on this project he
was working on for his boss, a report that he
was going to write for his boss. And in that
report he ran into a realization that might stun a
(25:50):
lot of people, and he wrote with with his team
a report called Life After Debt, which they submitted to
then President Bill Clinton and which journalists got a hold
of years later through a Freedom of Information Act requests.
And Life After Debt is a report that you can
(26:14):
read it for free online. It is a report that
outlined what would happen if the US paid down its
debt to zero. And they wrote this in December of
two thousand, because that's the year the U. S. Treasury
(26:34):
began actively buying back public debt, creating um, you know,
digging its way out of the financial hole was in.
But they realized, Jason realized eventually that while there is
such a thing as too much debt for countries, there's
also such a thing as too little debt. So countries
(26:57):
don't want to necessary rely have a surplus. In many
cases it's unreasonable outside of you know, a few a
few countries like the like Nordic countries, un some oil
oil wealth countries. So what we see is that the
(27:18):
international level understanding of debt and the individual levels to
understand debt is different. Not all debt is created equally.
Businesses will go into debt and have specialized, custom fit
or bespoke plans for balancing that debt. However, someone who
(27:42):
was built into a series of high, high interest credit
cards or student loans will often not have that sort
of recourse. Here in this country, there are federal programs
that are so opposed to provide assistance for people who
(28:04):
have the misfortune of not being a business or a
country when they go into debt. However, much more money
is spent by the folks who make money off of
credit cards and student loans to make sure that system continues.
And as of now, debt what we've explained so far, Yes,
(28:25):
there is an inequality of debt. Not all debt is
created equal, not all people are in debt. But debt
is a problem for a lot of individuals, especially here
in the West. But the truth of the matter is
debt makes the world go round. So we were asking
ourselves a few weeks back, what would happen if we
(28:47):
woke up one day and all of the debt disappeared.
We'll find out right after a quick message from our sponsor.
Here's where it gets crazy. All right, everyone, it's story time.
(29:10):
Let's imagine a scenario where this actually happened, where where
through some act of massive buffoonery, sorcery. It's not something
insane happened, and Mr Noel Brown wakes up in a
world free from debt. Ah, I can hear how relax
(29:35):
he is exactly look at this world free from debt. Yeah. Well,
the great news is if he had any student loans,
medical bills, credit cards, mortgage to automatically, he'd be in
the clear for all those debts. It's gone. What a
time to be alive, guys. So so what what we do?
Of course he would take some he would want to
(29:57):
get to take some cash, get on that first dream
trip with his you know, his honey, his squeeze, his
girl every and uh, naturally they would go to Borneo.
That would go to Borneo, and go to Borneo. But wait,
there would be some problems here. Oh, to get the
tickets to Borneo, Noel Brown has to buy them, and
(30:20):
the debit card he tries to use to buy the
ticket doesn't work because the bank that runs that debit
card is in a tail spin because debt no longer exists.
And the dirty open secret about banks, I don't know
if it's necessarily call it dirty, it's just how they work.
Is that the money in Noel Brown's account was used
(30:41):
to be a loan to someone else. Yeah, Rain Capital
used it to invest in a small company in Atlanta
or something like that. Yeah, And that's when that's when
Noel Brown has to explain to this woman that he
loves he was going to take it on a magical
romantic get away to Borneo. Why they can't go to Borneo?
(31:04):
And he gives her his following speech. Well, you see,
as it turns out, most of the money in the
world is really just someone else's debt. Yeah. The money
in your bank account, my bank account, our joint bank
account because we're in love, is mostly on loan to
(31:24):
other people. Why. Yeah, the bank they took our money
and they used it to give someone else a car loan,
to give someone else a home loan, to give someone
else a loan to buy a suite new computer. Oh
(31:45):
but wait, there's more. There's an upside here for the banks. Yeah,
they get to use some sneaky accounting, very tricksy accounting,
and by doing that they don't have to hold every
one's money all of the time. It's a it's sort
of a game of you know, back and forth. It's
(32:06):
being moved around all over the place. They just hold
some of the money, and by some we're talking a
tiny fraction. So at the height of the financial crisis
in two thousand seven, many banks were actually leveraged at
a ratio of thirty to one. Then, can you clarify that? Yes,
(32:28):
So in this scenario, I've I've showed up at Noel's
house and he's explaining to the love of his life
they can't go to boardio. Well know, we're at the airport.
Oh you're at the airport. Oh okay, alright, cool, Now
I feel underdressed because I'm obviously in my jammie's. But
I only go to the airport in my jammie's. I
(32:49):
think that's the only time I've ever said the word jammies. Alright,
rule of three. So to clarify, Noel Brown, in his
moving tragic speed, will be telling this this uh love
of his life and whomever else is going to go
with them, that his bank account and all bank accounts
(33:09):
are essentially emptied unless the bank magically replenishes the account,
which would throw things into chaos. But you know, it
is a series of key strokes on a computer screen.
At least we have the fdi C that ensures up
to a certain amount, right, right, But a bank no
longer has a reason to exist as its sole purpose
(33:30):
for from this perspective, is to move debt around every
stock exchange. While Noel Brown is delivering this speech in
Hartsfield Airport, I imagine you're in Hartsfield, of course. Okay, Uh,
every stock exchange closes, Noel's investment portfolio is wiped out.
The puka shells he still has, but any puka shell futures,
(33:54):
any uh puka shell short short stocks, And I'm just
making upwards. Yeah, I'm gonna I'm gonna need that countosh back. Sorry,
I hope you don't mind, because an investment is just
funding someone else's debt with the promise or the hope
of getting more back in return, but no one will
pay you back. And also, uh, Noel and his sweeties
(34:16):
retirement funds, they have one along with everybody else's. Also
poof vanish. There's a guy named Thomas Dalton who I
think described this really well. What would happen if lenders
wrote off all debts he sets is that there would
be a massive transfer of wealth from net lenders to
net borrowers. The net lenders of the world are things
(34:40):
like governments right uh, and young adults are We are
often net borrowers, and those close to retirement are often
net lenders because pension funds invest by lending at least
some of the money out. So what would happen if
debt was erased would be a massive transfer of well
from the old to the young and to governments. And
(35:04):
Dalton also says we can make a mistake by thinking
of this as a transfer of wealth from the rich
to the poor, but it wouldn't work that way because
the very poor don't usually have much debt. No one
is willing to lend to them. It's only those with
large incomes or assets or potential incomes that build up
significant debt. So depending on what governments do now that
(35:24):
they're free from paying interest on their debts, they were
never going to actually pay back the debts, so it's
just the interest. The poor might benefit from extra government spending, however,
it might be the rich that benefit from tax cuts.
Pensioners and those who are getting to retirement age would
have some serious difficulties. The super wealthy, says Dalton, may
(35:45):
lose some money, but they usually invest in equity rather
than debt. So since the companies they own often have
a lot of debt, the share prices would probably increase enormously,
assuming of course, that the stock market would still be around,
which is debatable. And then he said, in addition, institutional
lenders would all be bankrupt, banks, insurance companies, pension funds,
(36:06):
the world economy would probably collapse, and to be honest,
everyone would suffer erasing all debt. This that that's his quotation.
In our opinion, a racing all debt is the nuclear
weapon of economic warfare, which sounds kind of heady until
we realize that economic warfare already exist today. It's occurred
in the past. We've talked about it a little bit
(36:28):
before with a guy named John Perkins who wrote a
book called Confessions of an Economic hit Man, and what
she says he worked for an engineering company in Boston,
and his job was to convince leaders of underdeveloped countries
to accept development loans for construction and engineering projects, and
having a condition of those loans be that the projects
(36:50):
went to US companies, and these loans would later give
the US government influence and access to natural resources. And
we have a quote from the book that we're going
to read here. Economic hitmen are highly paid professionals who
cheat countries around the globe out of trillions of dollars.
They funnel money from the World Bank, the US Agency
for International Development, and other foreign aid organizations into the
(37:14):
coffers of huge corporations and the pockets of a few
wealthy families who control the planets and natural resources. Their
tools included fraudulent financial reports, rigged elections, payoffs, extortion, sex,
and murder. They play a game that is old as empire,
but one that has taken on a new and terrifying
dimension during this time of globalization. And this is something
(37:38):
we've explored before. Uh often referred to as resource extraction.
So that's one example of how economic warfare could work,
and that would pale in comparison to the economic warfare
of erasing all debt, regardless of the intention behind it.
Erasing on that would be strange. But how how could
(38:00):
this We're talking about the ideas, right, and we've talked
about the numbers of debt, But let's talk about how
this could work. How could someone a race debt well
to do this? We look at some examples from pop culture,
because that's really the only place where this has been
(38:21):
fully explored. Yeah, and there's some fun ones, and I
mean it's it's like one of the ones that comes
to mind, UM that we haven't explicitly discussed together is
the movie Escape from l A, where at the end
they we are going to get into some spoiler territory here.
You also, if we're mentioning a movie or something and
you don't want to know what happens, you should probably
(38:41):
skip ahead maybe seven minutes or so, or you know,
go back ten years and watch Escape from you know,
it's it's on it's on the Netflix. I think you
can get it. But at the end of Escape from
l A, there's a device that essentially shuts down all electricity.
It's down even batteries. They make a point in it
(39:02):
to say like, oh, this will even like render all
batteries useless. And yeah, so this is sort of like
a super extreme version where it's like an all encompassing
attack that would not only get rid of all dead
as we know it, but pretty much reduced you know,
humanity too, back to the dark Age as we need
to you know, start over. But a really good one
that does specifically deal with UM actually targeting financial Corporations.
(39:25):
Is Fight Club nine, David Fincher film based on the
novel by Chuck palinak Um. There are some pretty significant
differences between the novel and the and the film, but
they do a pretty good job of having a very
similar let's say, mission statements. So in Fight Club, um,
they're the group of these kind of project yeah, project mayhem,
(39:49):
that's right, sort of a bunch of like depressed, overly
macho males, middle aged. Yeah. They want to fight back
because they feel like they've been marginalized as by society.
They are angry. Um. Honestly, their motivations are not particularly
um positive. They're not really trying to help anybody. They
(40:09):
just kind of want to watch the world burn a
little bit um in my opinion. That's that's what I
take from it. But in order to do this, they
stage an attack what could reasonably be considered a terrorist
attack on the corporate headquarters of several large credit card companies.
I think there seven buildings that are destroyed during the
en scene, which to me is such an iconic scene,
(40:30):
and it's the first place I ever heard the Pixies
uh song where is My Like who is this band?
And then I you know, I was down a rabbit hole.
From then on here we are so Um. Even at
the time, I always thought this was sort of a
little bit of a rudimentary example of wiping out the debt,
(40:50):
because it's like, surely these things are backed up elsewhere,
you know, not just in the building, And by blowing
up a building alone, you're not white being out the debt.
It would require some sort of deep infiltration of an
entire file system and structure and network, getting much more
into hacker territory before we get there, though, little bit
(41:13):
of an interesting fact toy that Matt turned me onto. Um,
did you guys know that in the novel Fight Club
it takes place in Wilmington's, Delaware. Do you guys remember
twelve o nine North Orange Street, the Corporation Trust Center,
the official address of over two companies, Willington, Delaware. Um,
(41:37):
there's a couple of little inklings in the film that
it takes place there as well. But I thought that
was a pretty clever non And this address keeps popping
up for us. We're gonna have to do. I think
we're gonna have to do like a whole episode this address.
Let's take it. Let's let's go there physically, listeners, let
us know if you was to go there, maybe we
can meet up to hang out. So, like I said,
(41:58):
I mean, I don't feel like this sample holds up.
This is more of sort of an anarchist kind of
like I said, watch the World burn kind of thing.
But um, we have we have a really good example
in our our wonderful sponsors. As it turns out, Mr
robot Um the series involving a sort of anonymous esque
(42:18):
society of hackers called f Society who orchestrates a very
high level cyber attack against E Corp, which to me
is I think a very clever stand in for Enron
maybe or like any other giant corporation or financial financial
levels or something. Sure. Um, and to me, this is
this is how you would you would do this. If
(42:40):
you were going to attempt to do some kind of
to orchestrate some kind of complete erasure of the debt record,
it would have to be through infiltrating these systems, not
just blowing up a building or one computer or one
set of servers. Yeah, and they and they do. Uh,
I guess it's a two pronged attack in there may
even be more than that that we just don't understand,
(43:03):
uh as viewers and you know, in the world of
Mr Robot. But they do it by using this thing
called Interpreter, which is a meta saploite backdoor. And the
main character, Elliott, goes into the main servers of e Corp,
installs a really simple program like an e x C
(43:23):
file on their server, which then gives them and and
easy to access back door to the servers so they
can go in. It's crazy. It uses memory, so it's
not actually writing anything to disk, it's just using the
RAM on the on the machine to create this backdoor.
I don't pretend to understand the hacking tools, but according
(43:44):
to numerous people online who are actually in the info
sex space and all this, they're saying that, yes, this
is this is real. You could do this and you
could delete information if you had this kind of backdoor.
And like I've said about the show, I mean it
definitely gets a lot of this stuff right. Even like
the when you see the dude doing his hacking, it
(44:04):
looks like command line things instead of some sort of
bizarrow like three D rendering of the Internet as it
would be if you were floating around and hackers or something. Yeah,
I was thinking of that nineties film Hackers as well.
Uh so what would be hit in these things? Insurance companies, Banks.
(44:25):
Insurance companies are bigger depositories of this kind of value
than you might think. There would also, of course, be
government institutions. This would be stuff like this would have
to involve treasuries as well as mints. This, this would
involve a simultaneous attack on thousands of things. Would be
(44:51):
very difficult to do. It also makes me wonder as
a little off, But it also makes me wonder if
someone had that power, why stop at debt? Why not
also erase repositories of personal information so like medical info? Uh,
you know the metadata that the National Snooping Administration collects
(45:17):
from you the Facebook servers. Yeah, and we talked a
little bit about the attack strategies. I think when you
mentioned the escape from l a scenario of effectively cutting
off electronics stuff. Right, what does this What does this
(45:38):
cloud money mean if we cannot access the cloud? Yeah,
if you would have to kill electricity indefinitely in order
to make that work, because there are you know, all
of these huge institutions like Iron Mountain that holds sensitive
data like this they've got him like crazy generators and
backup power and all this other. Not to mention, they
(45:58):
keep backups on like physical tapes and you know, like
stuff that would stand the test of time and a vault,
you know, and they're constantly updating these things and backing
up all their all their data. So yeah, absolutely, in
the old days of my family, it was very different. Uh,
there were things that would happen when somebody wanted to
(46:21):
get and we wanted information to disappear. And mean, think
about it. We live in a time where just less
than what a hundred years ago, even up to the
nineteen seventies eighties, if a right definitely sixties or so,
(46:45):
if a bank or a courthouse burned, then there would
be no evidence of debt or arrests or records. There
were people in my family were not true when they
were born because yeah, because someone burned a courthouse or two. Yeah,
and uh this I mean, but we no longer live
in that world because there are multiple copies of these records,
(47:09):
which leads us to why it probably wouldn't work if
we're talking about global debt records. Yeah, so in the
world of Mr Robot, it does work. Um, and that's
because Ecorp. Evil Corp. Owns roughly se of the consumer
credit industry, which is a bit hard to fathom. In
our world, it means they would just own as subsidiaries
(47:31):
let's say Capital One and most of the Visa other
companies that use Visa or MasterCard or any of those.
I feel like, in theory we have laws in place
to prevent things like that from happening. Well, you know,
hopefully it doesn't happen in the future for us, you know,
But but in our world it's and this is not debatable.
These various industries, from credit cards, mortgages, student loans, health insurance,
(47:56):
all of these are controlled by hundreds and hundreds of
separate compe eating companies. Like you said earlier, Ben, and
you would have to I mean, you would have to
strike at a huge number of locations in order to
make this happen. Um. In fact, almost all the computers. Um.
And Okay, so let's say you were able to take
out a single huge international credit card company. Look, I'm
(48:18):
just using Capital One. Sorry, capital I'm just using it
because I have your credit card. Um, it would be
this tiny, itsy bitsy little dent in the all encompassing
global debt machine that exists all around us, right, and
there's so many eyes watching this as well. There are multiple,
multiple international, state level and even local institutions that are
(48:43):
tasked with doing this. But then there's another thing, which
is uh. Many countries maintain a reserve of actual resources
rather than just currencies. So the US has you've probably heard,
a strategic reserve of petrol. Uh, the US has strategic
reserves of valuable metals, right, And other countries do the
(49:07):
same thing. And then we have other reserves of other
people's currencies. So if you hit one country, then the
currency that didn't get hit, that money will just become
more valuable. So think of these reserves as massive savings accounts.
They fluctuate as spending is needed. Uh. In some countries,
those reserves are uh dwindling, these currency reserves. Right. So
(49:31):
here's just a few examples. And some countries these reserves
are dwindling. You're getting low. According to the World Bank,
the US had five hundred and seventy four billion in
total reserves in the reserves fell below a hundred and
seven billion UM. But in other countries these reserves are
actually skyrocketing. In two thousand, China held a hundred and
(49:54):
seventy two billion, and that's in US dollars correct, And
in China's reserves jumped to a whopping three point three
four trillion, yes, trillion. And there are numerous reasons behind this. Uh.
Some have to do with the importance of one currency
versus another or treasury bonds. Another has to do with
(50:17):
trade versus currency or trade balance, and overall strategies of
where you're where you're going with your country. And it's
it's a fascinating thing that I think, Ben, maybe we
should look at in the future. Okay, yeah, I agreed. Uh.
And especially if this interest you, ladies and gentlemen, we
we can cover it. There's the other, the other factor
(50:38):
here that disaster recovery data backups. Something happens. Let's say
there is an attempt, well, the Mr Robots scenario, as
they said, for makes a little more sense than to
demolish the building's plan and fight club, because they're targeting
servers as well as backup data stores. And these things
(50:58):
have started to become common place in the nineties seventies
when people began to realize how um Matt you described
it best. When we said, insanely dependent we are we
as a species become on computers and the data contained
within those. So the strategies are redundancy plus off site
and cloud storage. The records of what is what and
(51:22):
when exists in multiple places, uh, which is also strange
because that kind of thing that not omnipresence but I
guess by location, is one of the miracles sometimes attributed
to saints. So going back to our earlier thing about
(51:42):
modern mythology, in a way, through robotics were through electronics
and computing, we are once again building the miracles of old,
but in a very strange way. So when we're looking
at this, the question is what is the stuff they
don't want you to know? More immediately? Who are they? Well,
(52:04):
at this point we can say we we feel we
feel pretty secure, saying that. One of the problems with
learning objectively about everything from individual finance to the financial
food fight that is international relations, uh and food fight
(52:26):
being you know, an allusion to the resources. Uh. The
what what we're seeing is that it's tough to learn
this because the people who can teach you have agendas.
So you learned this first, Huh, Well, the people who
can teach you will have agendas and that you know,
naturally I can tie into almost anything that we learn.
(52:50):
You know, somebody who is an Egyptologist is going to
have a very different opinion about the importance of Egypt
and civilization. Right. Sure, but in this case the stakes
are high and their currency, right. And I mean, of
course we're not denigrating Egypt, which is enormously influential. But
(53:11):
but but yeah, maybe archaeology is a bad comparison. I
think that's that's a great point though. If you ask
uh uh an economist from the US versus an economist
from China and economists from Russia or Iran, you're going
to receive different answers. And they're not necessarily the wrong
(53:33):
answers from that economist, they're the they're the answers that
most benefit that perspective. Right. And this means that in
our conversations Noel, Matt and I may have different perspectives,
It doesn't This is a case where if we disagree,
it doesn't mean one of us is wrong. Well, let's
(53:53):
get down to it. I mean, at the end of
the day, economics isn't an exact science. There are different
school of thought that are deep rooted in older schools
of thought, you know, and uh, like you said, just
because one person has a particular perspective doesn't necessarily mean
they're wrong, and the true answer might be somewhere in
(54:14):
between combining different perspectives. There's a pophy. There's a lot
of philosophy. Always use ideogy exactly, but it's it's very
it's not I don't want to say that it's imprecise.
I think that's that's short selling it just a little bit,
because I mean, obviously there is a lot of detailed,
high level thinking that goes into this, but it's much
(54:35):
more like a theory, you know, than it is a formula.
We also did not we also haven't looked at what
would happen if a concentrated segment or type of debt
were a race. If just for instance, just more how
specific do we want to go. Gent's just mortgages on
(54:57):
ranch style homes are just wiped out, Like what would that?
That would still have a ripple, less of an effect,
but it would still happen. I thought it would have
a ripple. If you know, all loans for any kind
of watercraft, you know, like a sailboat or a jet
ski it would have many ripples. I think I was
(55:19):
worth it. Or so, we we've talked a little bit
about the consequences, the the they the stuff they don't
want you to know. For this episode, the stuff will
be the state of economy, debt in the world, affecting
individual debt, an individual debt affecting the action of states,
(55:41):
the and the existence of currency. Yeah, you know, is
it just? Is it truly just? And I owe you?
Is it simply a system of coupons that future historians
will find, uh will put on the par of lost religions? Right?
I mean that's an extreme point of view, and that's
(56:02):
an extreme way to phrase that question. But what do
you think, ladies and gentlemen. We we spent some time
on this one, so we're going to head out of here,
but we would like to hear from you any stories
you have that you think more people should know about debt,
whether individual or international. What you think, if anything could
(56:24):
be changed to fix this or is this perfect the
way it is? Most importantly, do you think the world's
debt should be a race despite the frankly certain and
inevitable consequences, Because I'll say my personal perspective here even
if there were some kind of financial kill switch, a
(56:46):
reset button that would take debt to zero, Eventually debt
would a system of debt would evolve. Puka Shells. You
are on the ground floor, my man. So you can
let us know your thoughts on Facebook and Twitter. You
can also follow us on Instagram where conspiracy stuff on
(57:07):
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if you have feedback for this, we'd love to hear
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our best shows come from your suggestion. Before we drop
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say one more time. If you guys listen to the
(57:27):
show on iTunes, if you listen to the show on Spotify, Stitcher,
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(57:48):
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Matt Frederick
Ben Bowlin
Noel Brown
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