What if our entire understanding of capitalism is fundamentally flawed? Join us on a journey through history as we explore Richard Duncan's compelling argument that capitalism has evolved into what he terms "creditism." Starting from the collapse of the gold standard during World War I and leading through key events like the Great Depression and World War II, Richard provides an eye-opening historical analysis that shows how government intervention has become a cornerstone of our modern economy. Understand how significant changes in monetary policy during the 1960s and 70s, especially the severance of the dollar-gold link in 1971, have shaped the financial landscape we navigate today.
Ever wondered about the dangers lurking in our credit-based economy? Richard Duncan delves deep into the precarious nature of credit bubbles and the potential catastrophic consequences if they burst, as warned by Austrian economists like Ludwig von Mises. We also cover the government's pivotal role in staving off economic disasters during the 2008 financial crisis and the 2020 COVID-19 pandemic through aggressive deficit spending and monetary interventions. Additionally, we discuss the global implications of this credit-driven system, touching on how globalization, inflation, and geopolitical tensions like the war in Ukraine are intertwined with the Federal Reserve's and other central banks' policies worldwide. Don't miss this insightful episode that challenges conventional economic wisdom and offers a comprehensive understanding of our current financial system.
The content in this program is for informational purposes only. You should not construe any information or other material as investment, financial, tax, or other advice. The views expressed by the participants are solely their own. A participant may have taken or recommended any investment position discussed, but may close such position or alter its recommendation at any time without notice. Nothing contained in this program constitutes a solicitation, recommendation, endorsement, or offer to buy or sell any securities or other financial instruments in any jurisdiction. Please consult your own investment or financial advisor for advice related to all investment decisions.
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Episode Transcript
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Speaker 1 (00:08):
my name is michael guyad, publisher of the lead lag
report.
Join me for the rough 40 minutetime frame.
Here is mr richard duncan.
Uh, richard, you and I havedone, I think, got two or three
spaces in the past.
I know a lot of people arefamiliar with some of your work,
but do a brief intro onyourself.
What have you done throughoutyour career, where are you
located and what are you doingcurrently?
Speaker 2 (00:26):
All right, okay, well , thanks, michael.
Nice to see you again.
Thanks for having me back on.
So I started my career in HongKong in 1986 as a securities
analyst doing research on theHong Kong listed companies, and
since then I've lived in HongKong, singapore, thailand a few
times.
(00:46):
I've been a securities analyst,an economist, a strategist.
I worked for the World Bank inWashington for a couple of years
.
I was the global head ofinvestment strategy for ABN Amro
Asset Management, based inLondon for a couple of years and
(01:06):
along the way I've written fourbooks.
The first one was written about22 years ago, it was called the
Dollar Crisis, and the mostrecent one came out a couple of
years ago.
It was called the MoneyRevolution.
Speaker 1 (01:20):
And now my business is Macro Watch, a video
newsletter, and now my businessis Macro Watch, a video
newsletter, so I named theinterview to tease out we never
had capitalism, or fromcapitalism to creditism.
Creditism is a hard word to say.
I got kind of tongue-tied onthat, but I think we should
(01:41):
level definitions for those thatare listening and watching,
because I think a lot of peoplethink that what we have
currently is capitalism.
Speaker 2 (01:54):
What is the real definition of capitalism and
what in the world is creditism?
Okay, well, so capitalism moreor less reached its highest form
in the 19th century, but undercapitalism the government played
very little role in the 19thcentury.
But under capitalism thegovernment played very little
role in the economy.
Gold was money and marketforces more or less determined
(02:16):
what happened in the economy.
I mean, that's a very simpleversion, but those are the
basics.
Everything started going wrongin World War I.
That was the beginning and theend for capitalism, because
during World War I, all theEuropean countries went off the
gold standard.
They didn't have enough gold tofight the war, so they started
(02:36):
creating a lot of paper moneyand issuing a lot of government
debt that they used to buyweapons and fight the war.
That they used to buy weaponsand fight the war and that
destabilized the global economy.
The United States stayed on thegold standard.
World War I started in 1914,but the US didn't join until
(02:56):
1917.
And in the meantime the US soldEurope all the European
belligerent nations a lot of warmaterials and weapons and
received an enormous amount ofgold from Europe in those first
1914, 15, 16, and into 17 aswell, and all the gold entering
(03:16):
in the US at that time.
That really was the foundationthat sparked off the roaring 20s
, because we had so much moregold than we did before.
That allowed the banks toexpand credit through fractional
reserve banking.
So there was enormous creditboom all during the 1920s.
And then in 1930, that creditbubble blew up and banks started
(03:42):
failing in very large numbers.
And at that time the government, the policymakers they still
believed in laissez-faire andcapitalism and the rules of
capitalism demanded that marketforces be allowed to work.
So that's what happened Marketforces were allowed to work.
Unfortunately, market forcesresulted in the economy
(04:05):
collapsing by 50% in nominalterms.
Unemployment shot up to 25%.
A third of all the banks failed.
There was no deposit insurance,so everyone lost their money.
We went into a 10-yeardepression.
The depression didn't end untilWorld War II started.
They didn't do quantitativeeasing, they didn't have
(04:31):
enormously large budget deficitsto try to end the depression.
They just let market forceswork and they did, and that
meant a 10-year depression andthe depression only ended when
World War II started.
And when World War II started,then the government had
(04:51):
extraordinary spending on themilitary and the war.
Government debt expandedastronomically and that
government borrowing andspending in part financed by
money creation by the Fed.
That's the thing that ended thedepression.
But of course the government atthat point took over complete
control of the economy.
(05:12):
They took over production,distribution, labor and prices.
There were price controls andso the government had complete
control over the economy at thatpoint.
And well, the good guys wonthat war.
But afterwards we never wentback to a sort of a capitalist
(05:33):
system where the government wasnot involved and in fact things
deteriorated from there.
Things were fine in the late 40sand 50s.
Truman and Eisenhower more orless played by the rules of
capitalism.
The government's budget wasmore or less balanced.
(05:54):
Most of the time the Fed didn'tcreate a lot of money.
But starting in the 1960s thatchanged.
The government started runningvery large budget deficits and
the Fed started creating a lotof money to help finance those
budget deficits at low interestrates.
And by 1968, up until 1968, theFed had been required by law to
(06:17):
back all the money that itcreated with dollars sorry, to
back all the dollars it createdwith gold.
And they were able to do thatup until 1968.
But in 1968, they got to thepoint where they didn't have
enough gold left to issue tocreate one more dollar.
And so at that point, congressjust threw in the towel and said
okay, we're changing the law,the Fed doesn't have to have any
(06:40):
more gold to back dollarsanymore, any more gold to back
dollars anymore.
And that is the spark that, Ibelieve, launched the money
revolution, as I call it in mymost recent book.
That was 1968.
Afterwards, the Fed was free tocreate as much money as it
(07:02):
pleased, and just a few yearslater, in 1971, president Nixon
reneged on the United States'pledge to allow other countries
to convert their dollars into USgold, and so, after 1971, there
were absolutely no longer anylinks whatsoever between dollars
and gold, and that changedeverything in a number of ways.
(07:24):
Let me list them.
That's when capitalism startedevolving into creditism, first
of all, of course.
After that, the Fed was free tocreate as much money as it
dared, and at first it took aslow, but, as you can see, in
(07:44):
recent years, there have been afew years when the Fed has
created more than a trilliondollars in the space of 12
months.
That would have been entirelyimpossible if we'd continued to
back money with gold.
Of course, kevin Kennedy Jr,another important thing that
changed at that time was.
Up until then, internationaltrade had to balance, because
it's very easy to understand whyIf one country had a very large
(08:07):
trade deficit with anothercountry, that country was
required to pay for its tradedeficit by sending gold to the
other country, and gold wasmoney.
So if they had big tradedeficits for a number of years,
their money supply would haveshrunk very sharply, they would
have had an enormous recession,unemployment would have
skyrocketed and they simplywould have just had to stop
(08:29):
buying things from othercountries because they were
running out of gold and tradewould come back into balance.
So trade always balanced whenwe were under a gold standard or
a Bretton Woods system.
But as soon as that ended, itdidn't take the US long to
realize that it could startbuying things from other
countries that didn't have topay with gold anymore.
It could just pay with paperdollars or, more realistically,
(08:53):
treasury bonds denominated inpaper dollars, and there was no
limit as to how many of thosethe government could create.
So by the mid-1980s the US wasrunning a current account
deficit more or less the same asa trade deficit.
That was 3.5% of GDP For a bigcountry.
Nothing like that had everhappened before, and by 2008,
(09:14):
the US current account deficitwas 6% of GDP.
It was $800 billion in that oneyear alone, and altogether
since 1971, the cumulative UScurrent account deficit has been
$15 trillion Now.
This is enormously important fora number of reasons.
First of all, by allowing theUnited States to buy things from
(09:39):
other countries, especiallylow-wage countries, that put
downward pressure on US wages.
It was very disinflationary, sothe inflation rate fell from
14% in 1980 down to the lowsingle digits in most recent
decades and that allowedinterest rates to fall to very
(10:01):
low levels.
William Greenblatt, and also Inthis environment, the
government was able to borrowand spend on a much larger scale
than it had been before.
For one reason because itdidn't overstimulate the economy
.
Stimulate the US economy thatwe would have full employment,
(10:22):
full industrial capacityutilization and pretty soon we
would get upward pressure onprices.
Workers would demand higherwages.
There wouldn't be enoughfactories to create more cars
and so the overstimulation fromthe government, large budget
(10:45):
deficits and large governmentstimulus.
That would lead to high ratesof inflation, a wage push spiral
of inflation, like we saw inthe late 60s and early 70s.
But once we started buyingthings from the whole world.
We no longer had a closeddomestic economy.
Suddenly, we had a globalworkforce that was about 24, 25
(11:10):
times larger than the Americanworkforce, and most of these
people were earning 90% lessthan in the low-wage countries,
at least like China and Vietnam.
Today, bangladesh, india, iscoming into this picture, so
this allowed the government tohave larger and larger budget
(11:32):
deficits and use those budgetdeficits to stimulate the
economy and make it grow fasterthan it otherwise would have,
and to get away with thiswithout having high rates of
inflation.
The Fed could jump in andcreate a lot of paper money and
(11:53):
just finance the government debtby creating money and buying
government bonds, like we saw sodramatically after 2008 and
again in 2020.
And so this?
Meanwhile, it wasn't just USgovernment borrowing that took
off, it was the borrowing of allthe sectors of the economy.
We started to have an explosionof credit.
Household sector borrowingskyrocketed.
(12:14):
The borrowing and lending ofthe government-sponsored
enterprises like Fannie Mae andFreddie Mac they skyrocketed.
All the sectors of the economystarted borrowing and borrowing
more.
The more they borrowed, theforce that gave them more money
to spend with, to consume withand to invest, and this drove
(12:34):
economic growth.
So we've just hit a milestonethis quarter.
It first went through $1trillion in 1964.
(12:57):
So from $1 trillion in 1964 to$100 trillion a hundredfold
increase in credit in just what63 years.
And this changed everything.
Credit became the main driverof US economic growth and US
(13:20):
demand became the main driver ofglobal economic growth.
And since the, for instance,the ratio of total debt in the
US, or total credit to GDP, wentfrom about 130% in 1950 to
about 180% around 1980, up to360% by 2008.
(13:47):
So every year the credit wasgrowing faster than the economy.
The credit growth was makingthe economy grow.
Without the credit growth, theeconomy wouldn't have grown.
Speaker 1 (13:59):
But maybe before you get back to that, because the
way you were framing thingsbrought up a few questions of
mine I want to ask you Okay, soit's all credit-driven, credit
has to keep on expanding andexpanding.
Um, that immediately makes methink it's a ponzi scheme that
just requires more and more withevery iteration.
(14:20):
But let's go beyond that,because I don't think it's as
simple as saying it's a ponzischeme and it's all negative.
I mean, I've seen the samecharts you've seen on what
happened post 1971.
There were a lot of really goodthings in terms of economic
activity and growth that tookplace afterwards, aside from the
explosion of debt.
So what are the let's balanceit out what are the pros and
(14:41):
cons of such a credit heavybased system?
Speaker 2 (15:04):
Okay, right, well, so the main thing that I want
people to understand is that youknow, this system just evolved.
We went from.
It evolved once money stoppedbeing backed by gold.
No one planned it, it's just.
It was sort of the naturalevolution of things.
And now here we are.
So the problem is, if creditcontracts like it did in the
1930s, then we will go back intoa new Great Depression.
Can you imagine what a collapseof $100 trillion of credit
would look like?
It would be worse than theGreat Depression.
(15:24):
So that's the point.
Everyone needs to understandthe Austrian economist who
always talked about creditbubbles and how they lead to
disaster in the end.
Well, they were right whenLudwig von Mises wrote about
that in 1912 and earlier.
(15:44):
They were exactly right.
But here we are.
We have this enormous creditbubble.
Our economy now drives andworks on credit.
If we do anything that causes itto contract, for instance, in
2008, when the financial bubblestarted blowing up, then we
(16:05):
already had an enormous bubble.
Back then, the private sectorstarted defaulting.
And what happened?
Fannie Mae and Freddie Maccould repay mortgages.
Fannie Mae and Freddie Mac wentbankrupt.
They were enormously largeinternational players in the
capital markets, the financialmarkets and all of the US banks
(16:27):
started going bankrupt.
So what was the government todo?
If they had just pursued thelaissez-faire method, as we did
in 1930, then all of the bankswould have failed.
None of them could havesurvived, and if the government
didn't intervene, that meanseverybody's savings in those
banks would have been destroyedand the economy would completely
(16:49):
have collapsed.
We're talking about sort of areturn to the dark ages type
scenario.
So it was only the trilliondollar budget deficit, year
after year, after 2008, financedwith paper money creation by
the Fed.
The Fed created three and ahalf trillion trillion of paper
(17:10):
money between 2008 and 2014 andused it to buy a lot of the
bonds that the government wasselling to provide this stimulus
money that kept the economyfrom collapsing.
And hey, that worked.
We didn't collapse into a newGreat Depression.
There was no fall of Rome.
We are still here, we have ahigher level of government debt,
(17:34):
but we survived.
We didn't collapse into a newGreat Depression.
There was no fall of Rome.
We are still here, we have ahigher level of government debt,
but we survived.
And the same thing happenedagain in 2020.
Once COVID hit and people werelocked down and couldn't go to
work.
It wouldn't have taken long forthese people without government
support stimulus checks howwould these people have paid
their mortgages, their creditcard bills and their card-ons?
(17:54):
They wouldn't have.
They couldn't have, and sotherefore, once again, all of
the banks would have failed andwithout government intervention,
there again, everyone's savingswould be destroyed.
So everyone needs to understandthat our economy is very
different than it used to be.
And yep, the Austrians wereright Credit leads to bubbles,
(18:17):
but the problem is is here weare living on top of this bubble
.
If we do anything that makesthe bubble pop, then we are
essentially going to spiral intosomething worse than the Great
Depression.
That's what everybodyunderstands.
The Austrians are right, buttheir policy response now would
ensure that we are completelydoomed.
(18:39):
So that's the main message Ifyou try to balance the
government's budget, thengovernment spending will drop.
Government's budget, thengovernment spending will drop.
Therefore, I think the deficitthis year is expected to be $1.9
trillion.
Right, that would take $1.9trillion out of the economy.
So consumers and businesseswould have $1.9 trillion less,
(19:04):
so they would spend less andtherefore the economy.
There would be less consumption, less investment and the
downward spiral would begin.
Corporate banks would begin,the firing of employees would
begin, and it would just be avicious spiral downward.
Return to some sort of Austrianeconomic laissez-faire Garden
(19:34):
of Eden and expect to have somesort of happy outcome.
That is the certain way to thedestruction of our civilization.
Speaker 1 (19:48):
It seems to me that the elites are not that naive to
any of that, but, of course, aslong as they can kick the can
down the road, it doesn't matter, because somebody else will
deal with it.
Um, what do you think about allthis?
Um, debt forgiveness, right,that's.
That's kind of happening to me.
These are all precedents,whether it's on the college loan
(20:10):
side or so.
I think one of Biden's policiesis should he get reelected for
giving medical liabilities,medical debt, is that sort of a
pathway to a bigger reset on acredit-based system?
Speaker 2 (20:29):
Well, the debt forgiveness for the students is
just more debt on the back ofthe government, so that's not a
reset of anything.
It just moves one person's debtto the government's debt, so
that doesn't reset the amount ofdebt that we have.
So the bad news is we have anenormous amount of debt now.
(20:53):
The government debt is about120% of GDP.
That's higher than it was atthe end of World War II, but
this is still only half thelevel of Japanese government
debt to GDP.
Japanese government debt to GDPis about 260% of GDP.
(21:15):
They blew past where we are 25years ago, so we can probably
keep the.
You know you mentioned kickingthe can down the road.
So we can probably keep the.
You know you mentioned kickingthe can down the road.
Then absolutely let's keepkicking that can as far as we
can, because otherwise, when thecan stops moving, that's
(21:38):
essentially when we all die.
Our economy collapses and everyyou know if the economy
collapses, the governmentrevenues will collapse.
That will mean the governmentwon't have money for things like
social security, medicare, themilitary.
We won't be able to fund ourmilitary bases around the world.
(22:01):
So we're essentially talkingabout societal collapse and
global internationalgeopolitical chaos in that
environment.
So, yes, I am in thecan-kicking camp.
Let's kick the can.
For a long, long time, this hasbeen working now since 2008.
(22:21):
It's worked twice and there'sno sign that it's about to stop
working anytime soon.
But let's think about this.
You can think about this.
Okay, that it's about to stopworking anytime soon, but let's
think about this.
You can think about this, okay,it's like we've gone up in a
big hot air balloon and nowwe're getting afraid because
we're quite high above theground.
Well, the solution here is notto turn off the hot air and
(22:42):
suddenly crash back down toearth and die.
The solution here is to keepthe balloon in the air and try
to come up with some solutionbefore the thing crashes.
And so we have time ahead of us.
And so it seems to me, since wehave to keep the credit
expanding, the private sectorcan't keep growing its debt
(23:06):
indefinitely, but the governmentsector can keep growing its
debt indefinitely.
Speaker 1 (23:10):
But the government sector can keep growing its debt
.
So I've got on the screen aslide you sent from a deck you
messaged me with.
What I'm hearing from you isthat the end result is that
we're still going to see a lotmore of an increase in Fed
holdings.
Right, I mean this dip thatwe've seen in the assets of the
(23:31):
Federal Reserve.
Right now we've got $9 trillionor so.
That's just momentary.
You're going to see aresumption higher.
Speaker 2 (23:41):
I think that's right.
I think we will.
There's been some quantitativetightening that has taken them.
It peaked at $9 trillion oftotal assets.
Now it's down to somethingcloser to $7.2 trillion.
So they actually have destroyedsomething like $1.8 trillion
through quantitative tightening.
But it's very interesting, eventhe Congressional Budget Office
(24:03):
is projecting that the Fed willonce again have to expand its
holdings of treasury securitiesover the next decade.
So, yes, we're going to seegovernment debt continue to grow
and we're going to see theFed's balance sheet continue to
grow in order to support thegrowth in the government debt,
(24:25):
to finance that debt at lowinterest rates.
But all of this requiresglobalization to persist,
because only as a result ofglobalization can the government
get away with so much stimulusand so much money printing.
We had a sharp spike we didn'thave any inflation after the
(24:45):
crisis of 2008.
The highest inflation we hadthen was 3.8% in 2011, despite
the $3.5 trillion that the Fedcreated at that time.
But after COVID, the Fedcreated roughly a similar amount
of money, but this time we hada spike of inflation up to 9% on
(25:06):
the CPI.
Well, why was that?
It was primarily because of theglobal supply chain bottlenecks
.
We get most of our manufacturedgoods now from Asia, and Asia
was locked down.
The shipping was disrupted andso there was a lot of demand and
(25:26):
it was impossible to get thesupply from Asia to the US.
And then, on top of that, thewar in Ukraine began.
Russia invaded Ukraine.
That caused oil and food pricesand metal prices to spike again
.
So we had two big rounds, twovery big blows to globalization.
(25:48):
But now, for the most part,those have been worked out, and
as they were worked out, theinflation rate dropped very
quickly from 9% Now it's back to3% on the CPI.
It wasn't really the Fed thathad so much to do with bringing
the inflation rate down, in myopinion, because the Fed was
(26:08):
trying to slow the demand bypushing up interest rates, which
would make the economy slow,which would result in higher
unemployment, less consumption.
But none of that happened.
The unemployment rate is stillvery low.
Consumption has been verystrong.
So it wasn't the supply thatslowed, it was just the supply
chain.
Bottlenecks allowed the demandto start flowing again.
(26:31):
So it's crucial thatglobalization survives.
If we have a collapse ofglobalization, then we'll be
right back where we were in thelate 1960s, where a lot of
government stimulus and a lot ofmoney creation by the Fed would
lead to very high rates ofinflation because we would once
again have a closed US domesticeconomy, and so that is a real
(26:59):
concern, because I've spent mostof my career in Asia and I've
been a major beneficiary of thisexpansion of the US current
account deficit.
I've watched Asia developeconomically.
I lived here through themiracle years.
It was incredible to see asChina was transformed from a
(27:21):
very poor developing economyinto now the second most
powerful country in the world,quickly approaching becoming the
most powerful country in theworld if we're not careful.
And all of that was the resultof the US current account
deficit, but that meant thatthere was no inflation in the US
.
Now you know, we may be leadingthis age of globalization, be
(27:50):
leading this age ofglobalization, and if we do,
then we will return to a periodof potentially double-digit
inflation and double-digitinterest rates, which would
cause a collapse of wealth, andthe collapse of wealth would
cause a collapse of the economy.
So the protectionist trend thatwe are living through there's a
real chance it's going tobecome worse, but if it does,
(28:14):
the impact on the US economy andthe global economy will be very
severe.
Speaker 1 (28:22):
And, to be clear, all these dynamics in the US are
found everywhere, right?
I mean there's no singlecountry that doesn't have some
elements of the creditism,credit-based dynamic.
Speaker 2 (28:34):
That's right.
Creditism has become a globalphenomenon.
Once the US stopped backingdollars with gold, the whole
gold-backed internationalmonetary regime collapsed and
all the central banks were freeto create as much money as they
pleased.
So the Chinese central bank andthe Bank of Japan, the European
(28:55):
central bank they've allcreated money on a scale of
trillions of dollars each andthey've used that money in some
cases to manipulate theircurrency in China in particular.
(29:19):
China has a big trade surplus.
The Chinese manufacturingcompanies sell their goods in
the US.
They get paid in dollars.
They take the dollars back toChina.
They want to convert them intothe Chinese currency.
But if they did that in thefree market, that would push up
the Chinese currency to a veryhigh level and that would kill
China's export-led growth.
(29:40):
So to prevent that fromhappening, china's central bank,
the PBOC, and China's centralbank, the PBOC, created their
own money and used that to buyall the dollars coming into
China, and at a fixed exchangerate.
So the currency didn'tappreciate and the People's Bank
of China ended up with about $3trillion literally.
(30:05):
And once they had the dollars,they had to use these dollars.
They had to invest them backinto US dollar-denominated
assets, because they havedollars.
If they want to earn anyinterest on them, they have to
invest them indollar-denominated assets.
So they bought a lot ofTreasury bonds too.
So other central banks nowactually own more US Treasury
bonds than the Fed does USTreasury bonds than the Fed does
(30:32):
.
I think the other central banksin total own about $8 trillion
of US Treasury securities $8trillion.
Total US government debt isabout $35 trillion.
So that's a very big chunk $8trillion whereas the Fed now
only owns about $4.5 trillion oftreasury securities.
So I believe together the Fedand the central banks of the
(30:55):
other countries combined own 35%38% of all US treasury
securities.
They own them because theycreated money and with the money
they created they bought thetreasury securities.
So this is a key aspect ofcreditism.
That is completely somethingthat no one on a gold-backed
(31:20):
monetary system could have evenconceived of before 1968.
Speaker 1 (31:28):
We only have a couple of minutes, Rich.
I could give you that thought,but then I also want you to talk
about some of your research andwhere people can access it.
Speaker 2 (31:36):
Yeah, so it's important to understand that the
economy works in a completelydifferent way now than it did in
the past.
The government tries to managethe economy through very large
stimulus programs.
When necessary, the Fed is freeto create limitless amounts of
money to finance the governmentdebt and globalization has meant
(31:57):
that there's been no inflationor very low inflation, and if it
persists, then inflation willbe low.
So this is not the way thingsworked back in the 19th century
when we were on the gold-backedcapitalist economic system.
So it's important to understandthe forces that drive the
(32:18):
economy now.
They are new and differentforces, and so in my work in
MacroWatch, in my MacroWatchvideos, that's what I focus on
Looking at credit creation,forecasting that, looking at Fed
policy, looking at governmentpolicy in general, looking at
the policies of other centralbanks around the world, and to
(32:41):
forecast how that's likely toimpact asset prices in the US
and around the world US stocksand property, as well as
commodities and currencies.
So that's what I do with mybusiness now MacroWatch.
Macrowatch is a videonewsletter.
Every couple of weeks I uploada new video.
(33:05):
These videos are essentially medoing a PowerPoint presentation
discussing something importanthappening in the global economy
and how they'll impact assetprices.
They tend to be about 20minutes long, they have about 40
or 50 charts that can bedownloaded and essentially they
explain the forces driving theeconomy and the financial
(33:26):
markets in this newpost-capitalist age that we live
in.
Speaker 1 (33:33):
And what's the URL on that?
Speaker 2 (33:34):
the website yeah so Macro Watch was started in 2013.
I've created about 100 hours ofvideos since then which
subscribers can access in thearchives, and they can find
Macro Watch on my website, whichis richardduncaneconomicscom.
That'srichardduncaneconomicscom, and
(33:58):
I'd like to offer them asubscription discount.
If they'd like to subscribe toMacro Watch at a 50% discount,
just hit the subscribe nowbutton and, when prompted, type
in the discount coupon codeSPACES.
That's SPACES, s-p-a-c-e-s.
Speaker 1 (34:16):
I'm going to try to have Richard on for another
podcast because there's a lot ofthings that I want to ask him
and unfortunately, because ofthe difficulties, we have to
keep a little bit short here.
But please make sure you followRichard Duncan, Check out his
work as well and hopefully we'llsee you next time when we can
have a much deeper conversationover a full hour.
I appreciate it, Richard.
Thank you.
Speaker 2 (34:34):
Great seeing you again.
Take care.
Speaker 1 (34:36):
Cheers everybody, Thank you.
my name is michael guyad, publisher of the lead lag
report.
Join me for the rough 40 minutetime frame.
Here is mr richard duncan.
Uh, richard, you and I havedone, I think, got two or three
spaces in the past.
I know a lot of people arefamiliar with some of your work,
but do a brief intro onyourself.
What have you done throughoutyour career, where are you
located and what are you doingcurrently?
Speaker 2 (00:26):
All right, okay, well , thanks, michael.
Nice to see you again.
Thanks for having me back on.
So I started my career in HongKong in 1986 as a securities
analyst doing research on theHong Kong listed companies, and
since then I've lived in HongKong, singapore, thailand a few
times.
(00:46):
I've been a securities analyst,an economist, a strategist.
I worked for the World Bank inWashington for a couple of years
.
I was the global head ofinvestment strategy for ABN Amro
Asset Management, based inLondon for a couple of years and
(01:06):
along the way I've written fourbooks.
The first one was written about22 years ago, it was called the
Dollar Crisis, and the mostrecent one came out a couple of
years ago.
It was called the MoneyRevolution.
Speaker 1 (01:20):
And now my business is Macro Watch, a video
newsletter, and now my businessis Macro Watch, a video
newsletter, so I named theinterview to tease out we never
had capitalism, or fromcapitalism to creditism.
Creditism is a hard word to say.
I got kind of tongue-tied onthat, but I think we should
(01:41):
level definitions for those thatare listening and watching,
because I think a lot of peoplethink that what we have
currently is capitalism.
Speaker 2 (01:54):
What is the real definition of capitalism and
what in the world is creditism?
Okay, well, so capitalism moreor less reached its highest form
in the 19th century, but undercapitalism the government played
very little role in the 19thcentury.
But under capitalism thegovernment played very little
role in the economy.
Gold was money and marketforces more or less determined
(02:16):
what happened in the economy.
I mean, that's a very simpleversion, but those are the
basics.
Everything started going wrongin World War I.
That was the beginning and theend for capitalism, because
during World War I, all theEuropean countries went off the
gold standard.
They didn't have enough gold tofight the war, so they started
(02:36):
creating a lot of paper moneyand issuing a lot of government
debt that they used to buyweapons and fight the war.
That they used to buy weaponsand fight the war and that
destabilized the global economy.
The United States stayed on thegold standard.
World War I started in 1914,but the US didn't join until
(02:56):
1917.
And in the meantime the US soldEurope all the European
belligerent nations a lot of warmaterials and weapons and
received an enormous amount ofgold from Europe in those first
1914, 15, 16, and into 17 aswell, and all the gold entering
(03:16):
in the US at that time.
That really was the foundationthat sparked off the roaring 20s
, because we had so much moregold than we did before.
That allowed the banks toexpand credit through fractional
reserve banking.
So there was enormous creditboom all during the 1920s.
And then in 1930, that creditbubble blew up and banks started
(03:42):
failing in very large numbers.
And at that time the government, the policymakers they still
believed in laissez-faire andcapitalism and the rules of
capitalism demanded that marketforces be allowed to work.
So that's what happened Marketforces were allowed to work.
Unfortunately, market forcesresulted in the economy
(04:05):
collapsing by 50% in nominalterms.
Unemployment shot up to 25%.
A third of all the banks failed.
There was no deposit insurance,so everyone lost their money.
We went into a 10-yeardepression.
The depression didn't end untilWorld War II started.
They didn't do quantitativeeasing, they didn't have
(04:31):
enormously large budget deficitsto try to end the depression.
They just let market forceswork and they did, and that
meant a 10-year depression andthe depression only ended when
World War II started.
And when World War II started,then the government had
(04:51):
extraordinary spending on themilitary and the war.
Government debt expandedastronomically and that
government borrowing andspending in part financed by
money creation by the Fed.
That's the thing that ended thedepression.
But of course the government atthat point took over complete
control of the economy.
(05:12):
They took over production,distribution, labor and prices.
There were price controls andso the government had complete
control over the economy at thatpoint.
And well, the good guys wonthat war.
But afterwards we never wentback to a sort of a capitalist
(05:33):
system where the government wasnot involved and in fact things
deteriorated from there.
Things were fine in the late 40sand 50s.
Truman and Eisenhower more orless played by the rules of
capitalism.
The government's budget wasmore or less balanced.
(05:54):
Most of the time the Fed didn'tcreate a lot of money.
But starting in the 1960s thatchanged.
The government started runningvery large budget deficits and
the Fed started creating a lotof money to help finance those
budget deficits at low interestrates.
And by 1968, up until 1968, theFed had been required by law to
(06:17):
back all the money that itcreated with dollars sorry, to
back all the dollars it createdwith gold.
And they were able to do thatup until 1968.
But in 1968, they got to thepoint where they didn't have
enough gold left to issue tocreate one more dollar.
And so at that point, congressjust threw in the towel and said
okay, we're changing the law,the Fed doesn't have to have any
(06:40):
more gold to back dollarsanymore, any more gold to back
dollars anymore.
And that is the spark that, Ibelieve, launched the money
revolution, as I call it in mymost recent book.
That was 1968.
Afterwards, the Fed was free tocreate as much money as it
(07:02):
pleased, and just a few yearslater, in 1971, president Nixon
reneged on the United States'pledge to allow other countries
to convert their dollars into USgold, and so, after 1971, there
were absolutely no longer anylinks whatsoever between dollars
and gold, and that changedeverything in a number of ways.
(07:24):
Let me list them.
That's when capitalism startedevolving into creditism, first
of all, of course.
After that, the Fed was free tocreate as much money as it
dared, and at first it took aslow, but, as you can see, in
(07:44):
recent years, there have been afew years when the Fed has
created more than a trilliondollars in the space of 12
months.
That would have been entirelyimpossible if we'd continued to
back money with gold.
Of course, kevin Kennedy Jr,another important thing that
changed at that time was.
Up until then, internationaltrade had to balance, because
it's very easy to understand whyIf one country had a very large
(08:07):
trade deficit with anothercountry, that country was
required to pay for its tradedeficit by sending gold to the
other country, and gold wasmoney.
So if they had big tradedeficits for a number of years,
their money supply would haveshrunk very sharply, they would
have had an enormous recession,unemployment would have
skyrocketed and they simplywould have just had to stop
(08:29):
buying things from othercountries because they were
running out of gold and tradewould come back into balance.
So trade always balanced whenwe were under a gold standard or
a Bretton Woods system.
But as soon as that ended, itdidn't take the US long to
realize that it could startbuying things from other
countries that didn't have topay with gold anymore.
It could just pay with paperdollars or, more realistically,
(08:53):
treasury bonds denominated inpaper dollars, and there was no
limit as to how many of thosethe government could create.
So by the mid-1980s the US wasrunning a current account
deficit more or less the same asa trade deficit.
That was 3.5% of GDP For a bigcountry.
Nothing like that had everhappened before, and by 2008,
(09:14):
the US current account deficitwas 6% of GDP.
It was $800 billion in that oneyear alone, and altogether
since 1971, the cumulative UScurrent account deficit has been
$15 trillion Now.
This is enormously important fora number of reasons.
First of all, by allowing theUnited States to buy things from
(09:39):
other countries, especiallylow-wage countries, that put
downward pressure on US wages.
It was very disinflationary, sothe inflation rate fell from
14% in 1980 down to the lowsingle digits in most recent
decades and that allowedinterest rates to fall to very
(10:01):
low levels.
William Greenblatt, and also Inthis environment, the
government was able to borrowand spend on a much larger scale
than it had been before.
For one reason because itdidn't overstimulate the economy
.
Stimulate the US economy thatwe would have full employment,
(10:22):
full industrial capacityutilization and pretty soon we
would get upward pressure onprices.
Workers would demand higherwages.
There wouldn't be enoughfactories to create more cars
and so the overstimulation fromthe government, large budget
(10:45):
deficits and large governmentstimulus.
That would lead to high ratesof inflation, a wage push spiral
of inflation, like we saw inthe late 60s and early 70s.
But once we started buyingthings from the whole world.
We no longer had a closeddomestic economy.
Suddenly, we had a globalworkforce that was about 24, 25
(11:10):
times larger than the Americanworkforce, and most of these
people were earning 90% lessthan in the low-wage countries,
at least like China and Vietnam.
Today, bangladesh, india, iscoming into this picture, so
this allowed the government tohave larger and larger budget
(11:32):
deficits and use those budgetdeficits to stimulate the
economy and make it grow fasterthan it otherwise would have,
and to get away with thiswithout having high rates of
inflation.
The Fed could jump in andcreate a lot of paper money and
(11:53):
just finance the government debtby creating money and buying
government bonds, like we saw sodramatically after 2008 and
again in 2020.
And so this?
Meanwhile, it wasn't just USgovernment borrowing that took
off, it was the borrowing of allthe sectors of the economy.
We started to have an explosionof credit.
Household sector borrowingskyrocketed.
(12:14):
The borrowing and lending ofthe government-sponsored
enterprises like Fannie Mae andFreddie Mac they skyrocketed.
All the sectors of the economystarted borrowing and borrowing
more.
The more they borrowed, theforce that gave them more money
to spend with, to consume withand to invest, and this drove
(12:34):
economic growth.
So we've just hit a milestonethis quarter.
It first went through $1trillion in 1964.
(12:57):
So from $1 trillion in 1964 to$100 trillion a hundredfold
increase in credit in just what63 years.
And this changed everything.
Credit became the main driverof US economic growth and US
(13:20):
demand became the main driver ofglobal economic growth.
And since the, for instance,the ratio of total debt in the
US, or total credit to GDP, wentfrom about 130% in 1950 to
about 180% around 1980, up to360% by 2008.
(13:47):
So every year the credit wasgrowing faster than the economy.
The credit growth was makingthe economy grow.
Without the credit growth, theeconomy wouldn't have grown.
Speaker 1 (13:59):
But maybe before you get back to that, because the
way you were framing thingsbrought up a few questions of
mine I want to ask you Okay, soit's all credit-driven, credit
has to keep on expanding andexpanding.
Um, that immediately makes methink it's a ponzi scheme that
just requires more and more withevery iteration.
(14:20):
But let's go beyond that,because I don't think it's as
simple as saying it's a ponzischeme and it's all negative.
I mean, I've seen the samecharts you've seen on what
happened post 1971.
There were a lot of really goodthings in terms of economic
activity and growth that tookplace afterwards, aside from the
explosion of debt.
So what are the let's balanceit out what are the pros and
(14:41):
cons of such a credit heavybased system?
Speaker 2 (15:04):
Okay, right, well, so the main thing that I want
people to understand is that youknow, this system just evolved.
We went from.
It evolved once money stoppedbeing backed by gold.
No one planned it, it's just.
It was sort of the naturalevolution of things.
And now here we are.
So the problem is, if creditcontracts like it did in the
1930s, then we will go back intoa new Great Depression.
Can you imagine what a collapseof $100 trillion of credit
would look like?
It would be worse than theGreat Depression.
(15:24):
So that's the point.
Everyone needs to understandthe Austrian economist who
always talked about creditbubbles and how they lead to
disaster in the end.
Well, they were right whenLudwig von Mises wrote about
that in 1912 and earlier.
(15:44):
They were exactly right.
But here we are.
We have this enormous creditbubble.
Our economy now drives andworks on credit.
If we do anything that causes itto contract, for instance, in
2008, when the financial bubblestarted blowing up, then we
(16:05):
already had an enormous bubble.
Back then, the private sectorstarted defaulting.
And what happened?
Fannie Mae and Freddie Maccould repay mortgages.
Fannie Mae and Freddie Mac wentbankrupt.
They were enormously largeinternational players in the
capital markets, the financialmarkets and all of the US banks
(16:27):
started going bankrupt.
So what was the government todo?
If they had just pursued thelaissez-faire method, as we did
in 1930, then all of the bankswould have failed.
None of them could havesurvived, and if the government
didn't intervene, that meanseverybody's savings in those
banks would have been destroyedand the economy would completely
(16:49):
have collapsed.
We're talking about sort of areturn to the dark ages type
scenario.
So it was only the trilliondollar budget deficit, year
after year, after 2008, financedwith paper money creation by
the Fed.
The Fed created three and ahalf trillion trillion of paper
(17:10):
money between 2008 and 2014 andused it to buy a lot of the
bonds that the government wasselling to provide this stimulus
money that kept the economyfrom collapsing.
And hey, that worked.
We didn't collapse into a newGreat Depression.
There was no fall of Rome.
We are still here, we have ahigher level of government debt,
(17:34):
but we survived.
We didn't collapse into a newGreat Depression.
There was no fall of Rome.
We are still here, we have ahigher level of government debt,
but we survived.
And the same thing happenedagain in 2020.
Once COVID hit and people werelocked down and couldn't go to
work.
It wouldn't have taken long forthese people without government
support stimulus checks howwould these people have paid
their mortgages, their creditcard bills and their card-ons?
(17:54):
They wouldn't have.
They couldn't have, and sotherefore, once again, all of
the banks would have failed andwithout government intervention,
there again, everyone's savingswould be destroyed.
So everyone needs to understandthat our economy is very
different than it used to be.
And yep, the Austrians wereright Credit leads to bubbles,
(18:17):
but the problem is is here weare living on top of this bubble
.
If we do anything that makesthe bubble pop, then we are
essentially going to spiral intosomething worse than the Great
Depression.
That's what everybodyunderstands.
The Austrians are right, buttheir policy response now would
ensure that we are completelydoomed.
(18:39):
So that's the main message Ifyou try to balance the
government's budget, thengovernment spending will drop.
Government's budget, thengovernment spending will drop.
Therefore, I think the deficitthis year is expected to be $1.9
trillion.
Right, that would take $1.9trillion out of the economy.
So consumers and businesseswould have $1.9 trillion less,
(19:04):
so they would spend less andtherefore the economy.
There would be less consumption, less investment and the
downward spiral would begin.
Corporate banks would begin,the firing of employees would
begin, and it would just be avicious spiral downward.
Return to some sort of Austrianeconomic laissez-faire Garden
(19:34):
of Eden and expect to have somesort of happy outcome.
That is the certain way to thedestruction of our civilization.
Speaker 1 (19:48):
It seems to me that the elites are not that naive to
any of that, but, of course, aslong as they can kick the can
down the road, it doesn't matter, because somebody else will
deal with it.
Um, what do you think about allthis?
Um, debt forgiveness, right,that's.
That's kind of happening to me.
These are all precedents,whether it's on the college loan
(20:10):
side or so.
I think one of Biden's policiesis should he get reelected for
giving medical liabilities,medical debt, is that sort of a
pathway to a bigger reset on acredit-based system?
Speaker 2 (20:29):
Well, the debt forgiveness for the students is
just more debt on the back ofthe government, so that's not a
reset of anything.
It just moves one person's debtto the government's debt, so
that doesn't reset the amount ofdebt that we have.
So the bad news is we have anenormous amount of debt now.
(20:53):
The government debt is about120% of GDP.
That's higher than it was atthe end of World War II, but
this is still only half thelevel of Japanese government
debt to GDP.
Japanese government debt to GDPis about 260% of GDP.
(21:15):
They blew past where we are 25years ago, so we can probably
keep the.
You know you mentioned kickingthe can down the road.
So we can probably keep the.
You know you mentioned kickingthe can down the road.
Then absolutely let's keepkicking that can as far as we
can, because otherwise, when thecan stops moving, that's
(21:38):
essentially when we all die.
Our economy collapses and everyyou know if the economy
collapses, the governmentrevenues will collapse.
That will mean the governmentwon't have money for things like
social security, medicare, themilitary.
We won't be able to fund ourmilitary bases around the world.
(22:01):
So we're essentially talkingabout societal collapse and
global internationalgeopolitical chaos in that
environment.
So, yes, I am in thecan-kicking camp.
Let's kick the can.
For a long, long time, this hasbeen working now since 2008.
(22:21):
It's worked twice and there'sno sign that it's about to stop
working anytime soon.
But let's think about this.
You can think about this.
Okay, that it's about to stopworking anytime soon, but let's
think about this.
You can think about this, okay,it's like we've gone up in a
big hot air balloon and nowwe're getting afraid because
we're quite high above theground.
Well, the solution here is notto turn off the hot air and
(22:42):
suddenly crash back down toearth and die.
The solution here is to keepthe balloon in the air and try
to come up with some solutionbefore the thing crashes.
And so we have time ahead of us.
And so it seems to me, since wehave to keep the credit
expanding, the private sectorcan't keep growing its debt
(23:06):
indefinitely, but the governmentsector can keep growing its
debt indefinitely.
Speaker 1 (23:10):
But the government sector can keep growing its debt
.
So I've got on the screen aslide you sent from a deck you
messaged me with.
What I'm hearing from you isthat the end result is that
we're still going to see a lotmore of an increase in Fed
holdings.
Right, I mean this dip thatwe've seen in the assets of the
(23:31):
Federal Reserve.
Right now we've got $9 trillionor so.
That's just momentary.
You're going to see aresumption higher.
Speaker 2 (23:41):
I think that's right.
I think we will.
There's been some quantitativetightening that has taken them.
It peaked at $9 trillion oftotal assets.
Now it's down to somethingcloser to $7.2 trillion.
So they actually have destroyedsomething like $1.8 trillion
through quantitative tightening.
But it's very interesting, eventhe Congressional Budget Office
(24:03):
is projecting that the Fed willonce again have to expand its
holdings of treasury securitiesover the next decade.
So, yes, we're going to seegovernment debt continue to grow
and we're going to see theFed's balance sheet continue to
grow in order to support thegrowth in the government debt,
(24:25):
to finance that debt at lowinterest rates.
But all of this requiresglobalization to persist,
because only as a result ofglobalization can the government
get away with so much stimulusand so much money printing.
We had a sharp spike we didn'thave any inflation after the
(24:45):
crisis of 2008.
The highest inflation we hadthen was 3.8% in 2011, despite
the $3.5 trillion that the Fedcreated at that time.
But after COVID, the Fedcreated roughly a similar amount
of money, but this time we hada spike of inflation up to 9% on
(25:06):
the CPI.
Well, why was that?
It was primarily because of theglobal supply chain bottlenecks
.
We get most of our manufacturedgoods now from Asia, and Asia
was locked down.
The shipping was disrupted andso there was a lot of demand and
(25:26):
it was impossible to get thesupply from Asia to the US.
And then, on top of that, thewar in Ukraine began.
Russia invaded Ukraine.
That caused oil and food pricesand metal prices to spike again
.
So we had two big rounds, twovery big blows to globalization.
(25:48):
But now, for the most part,those have been worked out, and
as they were worked out, theinflation rate dropped very
quickly from 9% Now it's back to3% on the CPI.
It wasn't really the Fed thathad so much to do with bringing
the inflation rate down, in myopinion, because the Fed was
(26:08):
trying to slow the demand bypushing up interest rates, which
would make the economy slow,which would result in higher
unemployment, less consumption.
But none of that happened.
The unemployment rate is stillvery low.
Consumption has been verystrong.
So it wasn't the supply thatslowed, it was just the supply
chain.
Bottlenecks allowed the demandto start flowing again.
(26:31):
So it's crucial thatglobalization survives.
If we have a collapse ofglobalization, then we'll be
right back where we were in thelate 1960s, where a lot of
government stimulus and a lot ofmoney creation by the Fed would
lead to very high rates ofinflation because we would once
again have a closed US domesticeconomy, and so that is a real
(26:59):
concern, because I've spent mostof my career in Asia and I've
been a major beneficiary of thisexpansion of the US current
account deficit.
I've watched Asia developeconomically.
I lived here through themiracle years.
It was incredible to see asChina was transformed from a
(27:21):
very poor developing economyinto now the second most
powerful country in the world,quickly approaching becoming the
most powerful country in theworld if we're not careful.
And all of that was the resultof the US current account
deficit, but that meant thatthere was no inflation in the US
.
Now you know, we may be leadingthis age of globalization, be
(27:50):
leading this age ofglobalization, and if we do,
then we will return to a periodof potentially double-digit
inflation and double-digitinterest rates, which would
cause a collapse of wealth, andthe collapse of wealth would
cause a collapse of the economy.
So the protectionist trend thatwe are living through there's a
real chance it's going tobecome worse, but if it does,
(28:14):
the impact on the US economy andthe global economy will be very
severe.
Speaker 1 (28:22):
And, to be clear, all these dynamics in the US are
found everywhere, right?
I mean there's no singlecountry that doesn't have some
elements of the creditism,credit-based dynamic.
Speaker 2 (28:34):
That's right.
Creditism has become a globalphenomenon.
Once the US stopped backingdollars with gold, the whole
gold-backed internationalmonetary regime collapsed and
all the central banks were freeto create as much money as they
pleased.
So the Chinese central bank andthe Bank of Japan, the European
(28:55):
central bank they've allcreated money on a scale of
trillions of dollars each andthey've used that money in some
cases to manipulate theircurrency in China in particular.
(29:19):
China has a big trade surplus.
The Chinese manufacturingcompanies sell their goods in
the US.
They get paid in dollars.
They take the dollars back toChina.
They want to convert them intothe Chinese currency.
But if they did that in thefree market, that would push up
the Chinese currency to a veryhigh level and that would kill
China's export-led growth.
(29:40):
So to prevent that fromhappening, china's central bank,
the PBOC, and China's centralbank, the PBOC, created their
own money and used that to buyall the dollars coming into
China, and at a fixed exchangerate.
So the currency didn'tappreciate and the People's Bank
of China ended up with about $3trillion literally.
(30:05):
And once they had the dollars,they had to use these dollars.
They had to invest them backinto US dollar-denominated
assets, because they havedollars.
If they want to earn anyinterest on them, they have to
invest them indollar-denominated assets.
So they bought a lot ofTreasury bonds too.
So other central banks nowactually own more US Treasury
bonds than the Fed does USTreasury bonds than the Fed does
(30:32):
.
I think the other central banksin total own about $8 trillion
of US Treasury securities $8trillion.
Total US government debt isabout $35 trillion.
So that's a very big chunk $8trillion whereas the Fed now
only owns about $4.5 trillion oftreasury securities.
So I believe together the Fedand the central banks of the
(30:55):
other countries combined own 35%38% of all US treasury
securities.
They own them because theycreated money and with the money
they created they bought thetreasury securities.
So this is a key aspect ofcreditism.
That is completely somethingthat no one on a gold-backed
(31:20):
monetary system could have evenconceived of before 1968.
Speaker 1 (31:28):
We only have a couple of minutes, Rich.
I could give you that thought,but then I also want you to talk
about some of your research andwhere people can access it.
Speaker 2 (31:36):
Yeah, so it's important to understand that the
economy works in a completelydifferent way now than it did in
the past.
The government tries to managethe economy through very large
stimulus programs.
When necessary, the Fed is freeto create limitless amounts of
money to finance the governmentdebt and globalization has meant
(31:57):
that there's been no inflationor very low inflation, and if it
persists, then inflation willbe low.
So this is not the way thingsworked back in the 19th century
when we were on the gold-backedcapitalist economic system.
So it's important to understandthe forces that drive the
(32:18):
economy now.
They are new and differentforces, and so in my work in
MacroWatch, in my MacroWatchvideos, that's what I focus on
Looking at credit creation,forecasting that, looking at Fed
policy, looking at governmentpolicy in general, looking at
the policies of other centralbanks around the world, and to
(32:41):
forecast how that's likely toimpact asset prices in the US
and around the world US stocksand property, as well as
commodities and currencies.
So that's what I do with mybusiness now MacroWatch.
Macrowatch is a videonewsletter.
Every couple of weeks I uploada new video.
(33:05):
These videos are essentially medoing a PowerPoint presentation
discussing something importanthappening in the global economy
and how they'll impact assetprices.
They tend to be about 20minutes long, they have about 40
or 50 charts that can bedownloaded and essentially they
explain the forces driving theeconomy and the financial
(33:26):
markets in this newpost-capitalist age that we live
in.
Speaker 1 (33:33):
And what's the URL on that?
Speaker 2 (33:34):
the website yeah so Macro Watch was started in 2013.
I've created about 100 hours ofvideos since then which
subscribers can access in thearchives, and they can find
Macro Watch on my website, whichis richardduncaneconomicscom.
That'srichardduncaneconomicscom, and
(33:58):
I'd like to offer them asubscription discount.
If they'd like to subscribe toMacro Watch at a 50% discount,
just hit the subscribe nowbutton and, when prompted, type
in the discount coupon codeSPACES.
That's SPACES, s-p-a-c-e-s.
Speaker 1 (34:16):
I'm going to try to have Richard on for another
podcast because there's a lot ofthings that I want to ask him
and unfortunately, because ofthe difficulties, we have to
keep a little bit short here.
But please make sure you followRichard Duncan, Check out his
work as well and hopefully we'llsee you next time when we can
have a much deeper conversationover a full hour.
I appreciate it, Richard.
Thank you.
Speaker 2 (34:34):
Great seeing you again.
Take care.
Speaker 1 (34:36):
Cheers everybody, Thank you.
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