➡ The text is a conversation between Raf and Phil, discussing various topics including their daily lives, the celebration of Sukkot, and financial matters. They talk about the concept of ‘end game’ in finance, the value of gold, and the current financial situation in London. They also discuss the inefficiency of physically moving silver between London and New York due to imbalances in the monetary system.
➡ The text discusses the complexities of the monetary system, focusing on the role of silver and the London Bullion Market Association (LBMA). It suggests that while there is silver, it’s not readily available at the clearing price, leading to potential issues. The text also explores the concept of repo trading volume, suggesting that the high volume could be due to a mathematical technicality rather than an increase in debt. The conversation ends with a discussion on the risks of centrally cleared repo, a relatively new phenomenon.
➡ The text discusses the complexities of the repo market and the difficulty in predicting a market crash. It also explores the concept of the “gentleman’s portfolio”, which traditionally consists of one third physical gold and silver, one third productive land or property, and one third business ventures. The author suggests that while having a thousand ounces of gold is considered wealthy, it’s more practical to invest some of that wealth in properties and businesses, allowing the money to circulate and generate income.
➡ The text discusses the risks of investing in unstable markets and the potential for financial crashes. It suggests that storing wealth in gold can provide a safety net during these crashes. The text also advises against investing in unfamiliar companies, especially those located far away, and instead recommends investing locally in businesses you can physically visit. Lastly, it proposes a balanced investment strategy, dividing wealth equally between gold, real estate, and business ventures, to protect against both inflation and market crashes.
➡ The text discusses the role of a capitalist, emphasizing that it’s a challenging job requiring constant decision-making and adaptability to market changes. It also highlights the importance of investing wisely, such as buying cheap properties with potential for future profit. The text criticizes the idea of controlling the velocity of money, arguing that it leads to economic crashes. It also dismisses the notion that China will emerge as a global leader after the West’s decline, arguing that leadership requires a certain culture which China lacks.
➡ The text discusses the impact of gold on economies, using hypothetical countries X and Y as examples. If X has more gold, its prices are higher. If X trades with Y, gold and goods exchange hands, eventually balancing the prices in both countries. The text also discusses China’s gold reserves, suggesting that if China doesn’t allow its gold to leave the country, it may have more gold but less goods. The text concludes by discussing the potential collapse of the dollar and the impact on global power structures, suggesting that no single country, including China, would be in control.
➡ The main point of the discussion is that the amount of gold in a system doesn’t matter, but the ability to inflate does. In the future, people won’t trust credit, leading to less credit and more money. This change will make the world look very different, possibly leading to a return to physical currency like silver. The speaker ends by saying they’re going to a barbecue in a classy tabernacle.

I get emails from viewers all the time saying, how long do you think it’s going to, like, when’s the end game, basically? And I. What I say is, I wake up. I. I literally wake up every day and I’m like, is today the day? I don’t know. I’m up to the. I’m. It’s at the point where I’m like, well, maybe this is it. I don’t know. Hey, guys, Raf here from the End game investor with this week’s edition of the Bitter End Game draft with Phil Lowe. Check out his channel on Rumble link in the description below.

How are you doing, Phil? I’m good. I’m wearing my Sound Money Society shirt from a. A viewer who sent. You sent me one. Did you. Did he send you one, too? I don’t think so. I think he likes you more. Oh, well, there you go. Yeah, I’m wearing my. I’m wearing my sukkus shirt because we’re supposed to dress up on Sukkot on the holiday. It’s not one of those days where I can’t do work, but we have to differentiate the holiday from regular day. So I’m in my sukkah in my shirt and where’s the lemon stuff in the background? Oh, the lemon.

The Etrog. It is inside. Wait, don’t you have to have the lemon in the tent? No, no, you. You have to pick it up with the Lulav and the Hadas and the Arava and shake it around and. Yeah, but I. I do that. But do you do that in the tent or do you. Outside of the tent? He went into the tent. I sent him out of the tent. You can do it in the tent, but you don’t have to do it in the tent. The only thing you have to do in the tent is eat and sleep and generally just do things that you would do in your house.

And the more that you do in the tent as opposed to your house, the better it is. So I am doing the interview in this house, in this tent, because this is my primary abode for seven days. Oh, God. So you, like, live in a tent for a week? It’s like backyard camping. I can go into my house, but I try to do main activities here most. Okay. Interesting. Interesting. It’s probably fun, actually. Bet the kids love it. Yeah. Yeah, they do. It’s good. It’s cool. Everyone has one in their backyard. So you go and you meet other people in their sukkas and it’s like.

It’s like mandated camping for a week. Everybody’s. Do people get jealous of each other’s tents? And they’re like, your tent’s a lot nicer than my tent, so. No, not really. Like, we need a better tent. They have a better tent than us. We have to upgrade our tent next year. You know what? No, no, no. There’s no. And then you just end up with another house. No, that doesn’t happen. Okay. Doesn’t happen. Yeah, maybe it’s the opposite. Maybe it’s a. Maybe it’s a purity ch challenge. So they’ll. Your wife, will you be like, their tent’s way worse than ours and therefore they’re more.

They’re more penitent or holy or whatever. You can’t have penitent without tent. Penitent pen. So there we. We’re going to talk about the Inyana Dioma, the stuff of the day, the crazy stuff that’s happening in London. In London. In London. And then we’re going to give some theories about why the repo volume can exceed bank reserves. Because that’s been bothering me and I think I have an answer. And then we’re going to talk about the gentleman’s portfolio. And then we’re going to talk about why the amount of money in the society does not matter. And why that is important is that people say that, oh, China has all this gold and they’re going to rule the world after the end game because they have all the gold and we’re all going to be Chinese slaves because they have all the gold.

The answer is it doesn’t matter how much gold they have because it’s a mimanafsha. It’s either. It’s either yes or no. Either way, damned if you do, damned if you don’t. If they have the gold and they spend it, then they would have to spend it in order to have the stuff that they could get for that gold. Otherwise they just have a bunch of gold and it doesn’t do anything. So if they spend it, then we have the gold because they will spend it and give it to other people by doing that. Or they don’t spend it and then it doesn’t matter.

So it doesn’t matter. It doesn’t matter how much gold China has. It’s totally irrelevant. But let’s start with what is going on in London. London, baby. Phil, how is this whole London situation? Is it tickling your fancy? Are you, are you waking up in cold sweats or warm sweats or fever dreams? Are you having, are you having good, good dreams about this? Yeah, So I get, I get emails from viewers all the time saying, how long do you think it’s going to, like, wins the end game, basically? And I, what I say is, I wake up, I literally wake up every day and I’m like, is today the day? I don’t know.

I’m up to the, it’s at the point where I’m like, well, maybe this is it. I don’t know that. But basically, yeah. The silver lease rate. I got an email from Chris Jensen about, not a personal email. He sends out a blaster email to all the subscribers that the lease rate had soared to 39%. And I said, well, that’s really high. How is that calculated? You know, I don’t, I don’t. We’ll have to look that up. And then, well, I got an email like eight hours later, the lease rate has surpassed 100%. So it’s like, wow, that is some real liquidity issues going on.

Now, I do want to, I do want to clarify one thing. There is silver in the LBMA vaults, but there is not. Nobody is willing to part with it for $50. That’s what the problem is. People want a lot more fiat currency to release their silver. And the bullion banks that are short do not want those numbers to go up because they are on the wrong side of it. So right now they’re paying a small fortune to have silver flown from New York over to London to try and alleviate the, the pressure on the, on the lbma.

I think it’s the Hunt brothers come back and they’re, they’re the other zombified Hunt brothers. Wait, one of them is still alive? Yeah. Is he? I didn’t know that. I think one of them’s still alive. There was a, there was a fat one and a thin one. I remember probably the thing, I think they were the basis for the Trading Places brothers. They really seem like they were. Your brother’s not well. We better call an ambulance. I, I showed a chart on Endgame Investor in the last post that we are at a, a near record, the highest premium for spot silver that has ever been over New York since 1980.

Now, I, I, I challenge and I deny that this is backwardation because backwardation would have to be prices for the same good in the same place. And this is not that. This is, I think, a special situation going on in London where there’s just not enough silver in London specifically. So the price of London silver is going to have to go up until it can coax silver out of probably New York. You know, silver’s been coming in from London to New York since the beginning of 2024. Now it’s at a record high in New York, so it’s just going to reverse the flow.

Now the, the bigger arbitrage. Yeah, yeah. The bigger question is why are these imbalances happening? In a, in a stable monetary system, there should be a constant price for silver and a constant lease price for silver. But then you have like waves going this way, waves going that way. You know, things are just. What’s funny is they’re, they have to physically move the silver. So they’ve been, they’ve been, they’re flying the silver. You know, they put all the silver on ships and send it to New York. And then second it gets there, like put it back on the plane.

We got to get back to London. There’s a squeeze. Oh, man. They’re spending all this resources getting this, just moving the silver between the two cities. So you’d think the entire, the entire idea of a clearinghouse, which we’ll talk about later regarding repo. The entire idea of a clearinghouse is that you cancel out these debts so that you don’t have to move the silver. Because dollars were originally silver. So when somebody owed somebody $50 and that same guy owed the other person $30, you cancel it out. You just move $20 instead of 50 and then 30.

So instead of moving $80, you’re moving $20. There’s, there’s no efficiency, there’s no point and moving and shipping silver across an ocean on a plane or a boat and then shipping it immediately back. It’s, it just, it means that our entire monetary system is so messed up that it can’t figure out what to do with these silver blocks on ships or whatever. Yeah, if, I mean, if you really wanted to pull a Die Hard, you could, somebody could like shoot down the planes. I’m not, I’m not advocating this. I don’t want anyone to get killed or, or sink the boats with all the silver on it, especially if they’re piloted by AI and you know, a self driving plane or a, or a self driving boat, you could sink all the silver and then down the whole monetary system.

And people Keynesians would say, what? It’s just a boat of silver doesn’t have anything to do with the monetary system. It does. Does. Sorry. You have to admit that. Yeah. There was. One of the Keynesians I follow just for, for hate watching is Jeff Schneider, the Euro Dollar University. And he had a post. Gold has hit $4,000. And it has absolutely nothing to do with inflation. Here’s why. And then it was, you know, you know, econo babble for several paragraphs. But anyway, so when you respond to Jeff Snyder, are you making a snide remark? Yeah, basically.

Yeah. It was a pun. It was a pun. I punned. Oh, I got it. I get it. Okay. Got it. Okay. All right. So is there more for the LBMA that we have to discuss? I would just say that I want to temper a little bit of the expectations because like I said, the silver is. It’s not like the lbma. You know, they open the vault and like some moths fly out and there’s no silver there at all. There is silver, it’s just not available at the clearing price. So they’re going to have to, they either need to do what they’re doing, which is fly silver over to put in the vault to say, see, there’s more silver, or they have to let the price go way up.

But for those expecting, like, tomorrow is the end game. I don’t, I don’t think this will be the catalyst of tomorrow being the end game, if that makes sense. Yeah, it’s not. It’s. I don’t think it’s going to be tomorrow. We’re going to have to see backwardation. That cannot be resolved. This, in theory can be resolved if the silver gets there. And the question is what, what price will it get there and will the price keep rising? And why exactly is the price rising? And you and I can say from our bird’s eye view, oh, because the monetary system is fakta.

But, but in terms of the proximate causes, what. Why is this happening right now on ground level? It’s hard to say. It’s just we, we know ultimately why, but the, the proximate causes level up to eventually a collapse of the dollar. But identifying each stage to that end is very difficult. And from what I understand, retail still has not jumped in yet. So this is still, this is still, you know, large, large family houses and banks fighting with each other. You know, the, the pe, the masses have not, have not awoken. Yeah. But more and more are.

I have a, I have a friend who’s really getting into. He’s really getting into it now. Yeah, actually, I had a comment you’d appreciate this from. This is a guy that I met because he was evacuated or he was evacuating from the center of the country during the Iran war when Iran was aiming for the center and not for here up north. So we. There were a bunch of guys that were looking for shelter up north. So this is one of those guys. And, and he was, he asked me what I did and I told him that I was a monetary philosopher.

And he, he knew all about options trading and this. Now he’s an investor, a businessman. He has like, like land that he purchased or whatever. Like one of the capitalists up there, like far higher than me. I just pretend to be a capitalist because I know what money is. So it gives me an opportunity to like, join the capitalist group when I really have no idea how to run a business. Except, you know, I can run my own business, but I’m not going to start hiring people and doing that. That’s just not in my head. So he says he.

I didn’t know that he watches you, but he sent me, he sent me a, a WhatsApp a few days ago. He’s like, rafi, I think I’m having a film moment where I’m having a nervous breakdown because I’ve suddenly realized that you’re right. I was like. He’s like, don’t worry. It’s going to be difficult, but it’s going to be a good difficult. Just relax. He already bought a bunch of silver from, from the Israeli company. So he’s, he’s safe. Ish. But wait, he knew about me before he knew about you? I don’t know if he knew about you before me.

Okay. I don’t think he did. I think, oh, he just, he just. I think because we have this podcast, he’s like, oh, and I recommend Phil that he goes and watches Phil. And then he heard about your nervous breakdown with silver. Do I have the Xanax bottle? I think I still do. Yes, I do. Right here. Yeah, I keep this. This is the bottle of Xanax they prescribe me and keep it here. I only ended up taking a couple and like, the panic attacks went away. So I was like, oh, fine. I’m fine. How much silver is the rest of the bottle worth? That’s a good question.

Yeah, don’t, don’t sell that stuff. That’s dangerous. Absolutely not. Okay, next. What’s the next one? I think we’re good on lbma. Lbma? The next one was the possible causes of more repo trading volume than dollars that exist to satisfy those trades. I thought more liquidity. I’m just spitballing here. You feel free to shoot this down. I thought one possible explanation was that because the treasury was switching long term debt to short term debt, additional credit was still being created. So the curve is still going up. So they’re still finding. They’re still finding debt that they are able to throw into the repo system.

I am going to shoot that down. Because if they are finding more debt, that’s fine. But I think that repos can only be traded for reserves and not for. For dollars on top of that base. Oh, okay, I see. I did not know that. Okay, so they can wait. They can only be traded for zombie money. They can’t be traded. Yeah, they have to be traded for zombie money. Not for. Not for dollars that exist in checking accounts that are extra. I think that’s interesting. Pretty sure that that’s the case. Well, then, then my theory is.

Is totally wrong. All right, what’s your theory? So my theory is just more of a. A mathematical technical issue that if, if, for example, let’s say I owe you $70 and then you owe me $50. So I could pay you $70 and then you pay me $50. Right. And then the volume of trade between us is $120. But if we say, look, Phil, I owe you 70, you owe me 50, how about I just pay you 20? And then you should say, sure, because that’s what’s going to happen anyway. Right. So then the vault, the trading, the trading volume is still 120, but the amount of dollars that actually moves is 20.

Because my debt to you of 70 is. Is paid off. And now my debt. And now your debt to me at 50 is paid off. So the debts that were paid off are 120 of debt paid off, whereas only $20 moved. So then you could say, like, why would we even move $120? Well, we wouldn’t. We just agree between ourselves to that. You pay me 20 or whatever it was. But if there’s like a circle of people that owe money to different people in that circle, and then you need a centrally, a central authority to figure out who owes what, to move the minimum amount of dollars between accounts in order to satisfy all those debts.

Right. Then that’s a clearinghouse. That’s how checking. That’s how checking works. The ach, what does it stand for? Something Clearinghouse. You send money to somebody by ach. It. It functions by clearinghouse because you’re sending money to somebody else. But if that’s somebody else owes somebody else money and that somebody else, through a chain of like a thousand people owes you, eventually money, it’ll cancel out and they’ll move the minimum amount of dollars to satisfy all the debts between all those people. Right. So that’s, I think that’s what’s happening with repo, because there is a central clearing house with repo, and this centrally cleared repo is a new thing.

This is not like it’s always happened this way. I think it’s. Since 2017 or 2018, it’s been gradually growing and there are risks with it. And I don’t really understand what the risks are. But basically what I think is going on is that some of the repo, I think it’s like 600 or 700 billion out of the 3 trillion that are traded are centrally cleared. So those $700 billion could represent, I don’t know, one and a half trillion instead of actually 700 billion. And so that money is being represented on all sides of it in the volume, whereas only some of that money is being transferred.

So then you could ask me the question. Well, if there’s a central clearinghouse for repo, this could. You could theoretically have a ratio of like 1000%, whereas 10 times the amount of money is being traded on the, on the volume side that is actually being exchanged between accounts. And I would say to you, no, I don’t think that’s happening because the SOFR at the repo rate is being very wobbly and uncooperative during month ends and during tax days. So we’re already seeing, we’re already seeing tightness in the repo market. So I don’t think we have that much to go.

I don’t think it’s. We have to go to like 200 or 300 or something like that. I think we’re still very close. I just don’t know where the, where the end is. Yeah, that, that, I mean, that, that all logically makes sense. I know it was hard to, like, when you. This is why it’s so hard to crash. Like, the viewers don’t understand, like, it’s really hard to call a crash. It’s almost impossible to call a crash. And so when somebody makes the crash call and then it doesn’t happen, everyone’s like, oh, you’re so stupid. But it’s just like you make the best guess you can with the evidence you have available, and then you have to figure out why you were wrong.

Now, I mean, it could be that we’re both wrong and that gold isn’t money and that the system can in fact sustain itself forever. That is a possibility, I guess. But it could also be that just the numbers that were being used to calculate the repo are not the inputs we are Getting are leading us to incorrect outputs because the numbers themselves are off somehow. Yeah. It’s just, it’s a very strange situation to be in where I’m. Where I’m wrong about a technical thing that I was taking my name to. And so I’m wrong about it, but I’m not really that disturbed about it because I still know what’s happening here.

Yeah. And silver’s at 50 and gold’s at 4,000 and everything seems to be going our way. So who’s really going to be mad at me? It’s not like I staked any trades on this. And I specifically said like, never trade based on this stuff. If you want to, if you want to make like for example, like. So this is an important point and I emphasize it on EGI that, that I, I saw these calls backwardation and Silver, blah blah, blah, everything’s going to hell. And I was like, this is not quite backwardation. And if you want to assume that it is and you think that on that the strength of Silver.

Silver backwardation that you call backwardation, we’re going to head into the end game in a week and you want to stake all your bets on that in some kind of options play. I think that’s stupid and I would never do that. But, but if you want to make a small bet that, that once silver breaks through 50, we’re going to head to like let’s say 60 or 70 in a few weeks or a month or two. You could, you could stake a few hundred dollars on that or a thousand dollars on that. If you have that money to lose and take a bet, that’s not a problem.

But you know, know what to stake your money. I will stake my money on gold and silver being money. I will stake my dollars on that and I will just wait. But I’m not, I’m not going to stake my money on the, on, on the repo market necessarily breaking down at any specific time. I have a, I have a, I have a bug of some sort. Hold on one second, please. He’s dead. Oh, who will make Bender waffles just the way he likes them now? So you, you had, you had. Actually I listened to it while I was making dinner.

You had a video on the gentleman’s portfolio. Before you talk to us about the gentleman’s portfolio, what are your sources on the gentleman’s portfolio? How do you know people were using it? And how long was this. Was this popular? Sure. So the, the gen. My, My sources are sort of a little vague. I mean, I don’t I don’t think it was a strict thing where people were like, I must have. Exactly. Let me explain what the gentleman’s portfolio is first. The gentleman’s portfolio is one third physical gold and silver. And that could be vaulted or in physical possession or in the form of, you know, things like jewelry or scepters or whatever.

Whatever the rich did back in the old days. And then one third, productive land, or even just your house. I mean, if you’re. If you’re on the lower level of the gentleman’s portfolio, just your house. And I bet in those days, too, the house probably was more productive than the house is now because people would work out of their houses more, and then the final third would be business ventures. So, you know, just to give context here, what would. How, what would a gentleman be nowadays? Are we talking billionaire, 100 millionaire, 10,000 ounces of. A thousand ounces of gold? If you.

If it was all in just dead gold in a vault, that’s a thousand ounces of gold would be $4 million. For $4 million. Yeah. That’s entry level into the. Into the gentleman’s club. All right. Okay. So $4 million wouldn’t. It’s. That’s not. That’s not a disgusting amount of money. No, no, it’s not. It’s a. And it’s, you know, if you think about it like I was the way I described it, like $4 million. If you had just $4 million right now and there was no more inflation whatsoever and prices were fixed for the rest of your life, you could, you know, if you’re about my age.

Yeah. You could probably never have to work. I mean, you have to be prudent. You can’t. You can’t go out and buy. You can’t go out and buy a mansion with a peeing cupid in the front yard and a helicopter and a boat and, you know, spend your life. You know, spend it. If you spend it frivolously. Yeah, It’ll be gone pretty quick. Right. To strip out the inflation, it would be like. It would be $35,000 in the seven. In the 60s or the 50s. Yeah. Like 1960. $35,000. You know, in. During the Great Depression, that.

That would be. That you’d be living large. Yeah. So. Yeah, yeah, yeah. No, absolutely. You could. I mean, you could be fine. You’d be a lot of people. A lot of people hear $4 million. And that’s still. That’s still quite a bit of money. Still quite a bit of change. So the, The I got this. It’s both, both Bill Holter and markets. So market Sniper has been talking about the gentleman’s portfolio and Bill Holter was talking about a thousand ounces of gold was considered wealthy. That’s, that’s the considered. You know, you’ve entered the wealthy club if you have a thousand ounces of gold.

But the thing is, if everyone just shoots for a thousand ounces of dead gold, so then there’s not going to be any gold in the system. So if there’s no gold in the system, what happens? The prices go down. The market, the market responds to the lack of gold, of metals in the system and it lowers prices until, until people, until the gold is coaxed out of people’s hiding places. So not many people actually have a thousand ounces of just dead gold sitting in their vaults. You know, there’s just not 7 billion people on earth. Yeah, there’s not enough gold to do that.

So what people do instead is they mix it so they have some dead gold. You know, maybe, maybe if I could theoretically get a thousand ounces of dead gold, I might just keep 1 or 200 ounces of dead gold in a vault. And then the others I will put to productive use. You know, I’ll invest in properties, I’ll invest in businesses. And so that allows. When you use gold as a money and silver, when you use gold and silver as a money, the money circulates, it’s moving between people. Right. You know, I buy a thing from you, you give me gold, or sorry, I give you gold, you give me things, you know, and then you go buy things and the gold is circulating around.

And so at each given point of time, people can have, you can have a thousand, you can have, you know, maybe 100, 200 ounces of dead gold sitting in a vault. And then you can have promises and claims on gold from companies you have invested in that says we will give you dividends and you can use that income to go buy things. And so you can maintain, you can maintain the lifestyle of having a thousand ounces of dead gold sitting in a vault without actually having a thousand ounces of dead gold sitting in a vault. Now the problem is that, you know, not well meaning bankers or you know, the credit system will, will print notes for gold that doesn’t actually exist.

And then people, you know, the circulating currency tricks people into thinking they’re much wealthier than they actually are. Then you have a crash, which we’re about to go through, and then you need, you need that dead gold that’s when the dead gold reaches the premium, you need that gold that’s sitting in a vault because you need to take that out to go spend it to get the stuff you need. And, and you can also use it to buy opportunities during the crash. By the way, if you want the, your dead gold to be live gold, then you can lease it out in monetary metals for 3 to 4%.

Just click the link in the description below and you will have revived your dead gold to gold that is alive. And, and just, just to riff on that for a second, I think in an honest monetary system where everyone is leasing their gold out for whatever the going interest rate is, there would be some very few people who would lose their gold or lose their investment. But I think that if you have an honest monetary system plus a little bit of insurance to insure against that, I think most, almost everyone would be able to safely lease their gold out in that kind of system and it wouldn’t be a problem.

Yeah, for the most part there’s always, you know, you know, if you watch the old historical dramas, there’s always people who are like, you know, I’ve, I’ve, I’ve invested in a rubber plantation in French Indochina, you know, like Vietnam, you know, and the other, you know, the other British socialites kind of like, oh really, you know, it’s a little like you got taken for a ride would be is sort of the reaction like and you know, and of course the stocks proved to be worthless. You know, the company doesn’t exist or you know, the moral of the story is always like don’t invest in a company on the other end of the world that you’ve never heard of just because some fast talking, you know, stock salesman, you know, swindled you.

Aerotine International, it is a cutting edge high tech firm out of the Midwest awaiting imminent patent approval on the next generation of radar detectors that have both huge military and civilian applications now. Yeah. So you know, the, the but you can also invest locally. You don’t have to. People think like, oh, exotic stocks from faraway countries are somehow more profitable. You can invest locally. You don’t have to go chasing dreams on the other end of the world. You really can’t stick locally to businesses that you can physically go and visit and make sure that customers are actually showing up and employees are doing a good job.

You don’t have to invest. In fact, most people did not participate in the stock. People participate, you know, the, the wide, wider population particating in the stock market is a clear sign of a Giant stock market bubble. That’s how, what’s his face, J.P. morgan, you know, he was getting his shoes shined and the shoeshine boy was like, oh yeah, I’m in those stocks too, you know. And that’s when he knew to get out immediately. So that’s most people, most people should just store their, especially if they’re not particularly wealthy. You know, the, the, the gentleman’s portfolio really is for somebody who has a bit of stored wealth.

The working classes portfolio is have eight children and let you know, take care of them when they’re young and then they’ll take care of you when you’re old. You know, they’re all, they’ll, all eight children will pitch in together to take care of you and your dotage and also just stack, you know, a little bit of gold, a little bit of silver and save that up and then draw that down as you, as you enter your dotage. And you can no longer, you know, do productive work on your own. I mean that’s sort of the working man’s portfolio.

If you have more wealth than that, you can participate in the gentleman’s portfolio where you have, you know, passive incomes generated by productive land and business ventures. So what I, what I advise people to do? Well, I didn’t advice, advice is illegal, Rafi, as you know. Well, no, so I would never do that. I don’t give advice. I, I, I don’t know anything. I’m just an entertainer. What I suggested might be something to consider in a non advisory position is that you overstack gold and silver now because we expect a monetary panic and then during the monetary panic you, you reverse that and you overstack or you over invest in real estate, productive land and business ventures and then you allow those business ventures to bring you back into the equilibrium of 1/3, 1/3, 1/3,.

And then you just stay there. You can, if you can, if you can successfully stay in the 1/3, 1/3, 1/3rd, you’re pretty much good either way because if there is more inflation then your land and your investments will inflate into prospect into fake prosperity. And then when they crash, you have your dead gold. All the wealth gets crammed back into the dead gold and you can go spend that. So the gentleman’s portfolio is pretty protective of both inflationary booms and the bust itself. Yeah, so actually one of the scariest things about the end game for me personally is the fact that once we hit a 15 to 1 ratio or somewhere around that and a 100% backing of all the Fed’s liabilities with gold, then I know I’m going to have to spend it, and I know I’m going to have to become a capitalist and have all these productive assets that I’m going to have to maintain, and I’m going to have to figure out how to do that.

And I really don’t want to do that at all. But that’s. That’s. I get that a lot from. From viewers, too. They’re like, what exactly am I supposed to spend this on? You know, what do I do? What do I buy? Like, you know, but it’s. It’s just. It’s just like. It’s just like during COVID right, all of the people that. We’re not vaccinologists and we’re not biologists and we don’t know how to. And a lot of us are nerds, and we don’t know how to whip up a crowd or get a following, but we know what’s going on here, and this is really bad.

And we all have to somehow team up. It’s just like a bunch of, like, hobbling, handicapped people was like, I know what’s going on. How do we. How do we, like, market this? How do we talk to people? What are we supposed to do now? And then somehow it enough of us knew sort of what we were doing to start speaking out. And eventually we stopped it. You know, with. Without. Without our opposition to everything that happened in Covid. It wouldn’t have stopped. It would have just kept going, going, going. Yeah, but. But we. We stopped it.

It took us a few years, but we stopped it. So I think the same thing’s going to happen in the end game. Like a lot of these, like, retarded capitalists, I. And I call myself that because I’m not. I was never meant to be a capitalist. I’m just a philosopher. We’re not going to know what we’re going to be doing at the beginning. And a lot of our. A lot of our investments are going to be just. We’re going to invest in real estate because a skyscraper is being sold for, like 15 ounces. We’re like, okay, I’ll buy that.

And like, you know, it’s just going to, like, collect cobwebs for the next 15, 20 years and, like, it’s crack house for whatever. And then. And then like, maybe 15 years later, we’re going to come by and like, say, okay, what should I do with this now? And somebody’s going to offer us maybe 30 ounces of gold for I was like, oh, look at that. I doubled my investment. Yeah, exactly right. That’s exactly right. I mean, you don’t, you don’t. I, you know, there’s a, there’s a Walmart in, in my town, I guess Walmart in every town.

But I was thinking like I could buy the abandoned shell of that Walmart and then somebody will come to me later and be like, I want to turn that into a, a, you know, a washing machine assembly plant. Yeah, okay, so maybe we’ll just be custodians of dead capital until the capitalists come out of their holes and, and they’re like, you know, I want to try this again. And this time they’ll listen to us as to what money is so they won’t be such idiots. And then we can give them control of the property or they can, or we can employ them and then they can be in charge of the business and then we can just like go and you know, keep philosophizing or whatever it is that we do.

Uh, we’ll, we’ll figure it out. It’s, it’s going to be messy, but that’s our calling. That’s what we have to do. Yeah. The important, what I would advise to the viewers is the, you don’t have to know what it is you’re, when you buy the abandoned, burned out shell of the Walmart, you don’t have to have a vision for what’s on the other side of it. That’s not necessarily your job, you know, that’s the capitalist job. If you are an entrepreneur or capitalist, then, you know, by all means turn it into whatever you want to turn it into.

But if you just, if you’re just like, I have this giant pile of gold and this building will never be this cheap again in my life. Should I buy it? The answer is yes, because it will, Somebody else will want to use it and you can rent it or sell it to them. So that’s really all you have to do. And then you can find something else to do with your cap. You know, you’ll get a return on that and you can go find something else to do and you can maintain yourself in the gentleman’s portfolio just by doing that.

And what I did, you know, people deride when I say capitalists. Capitalist is a job. It is absolutely a job. But people deride it because it, you know, it looks like a guy sitting back smoking, you know, blowing cigar smoke and deciding, you know, which peasants am I going to buy today? You know, but if you’re not good at capitalism. You, you quickly lose your capital and then you, you’re a working man. Once again, I think the way Rothbard described this, if I remember him, his description correctly, I don’t, I don’t remember where I read this, but he’s like, so the big capitalist who’s just sitting there and at a computer screen or looking at ledgers or whatever he is, he’s doing.

What’s it, why is he being paid so much? What is he actually doing that’s so valuable? Do you care to know why I’m in this chair with you all? I mean, why I earned the big bucks. I’m here to guess what the music might do a week, a month, a year from now. That’s it. Right. And he’s like, he basically said decision making ability. He has an entire machine and he’s got, he has to, he has to move it, he’s got to control it. It’s not automated because the market’s always changing. So he has to constantly adapt to the market in order to make this machine as capital machine, as efficient as possible.

And that requires constant decision making ability. Right? Yeah. In terms of, in terms of judging people, figuring out where their talents are, where they, because they’re the ones directly operating the machine. You’re just directing where the people operating the machine are going. Right. So you have to be able to judge character to see who’s going to be good at that job. What does he need to do, what skills that he do, you need to be a good reader of. Or else your capital machine is going to be destroyed because they’re all very, very fragile. Yeah. And you have, and you have to know when to cut bait.

Like, you have to know, like, okay, this was a bad idea. Stop Fun, you know, cease all future funding. Let’s go do something else rather than, okay, this just needs more investment, you know, this, this idea will take off. We just need to give it a little more capital. You know, that kind of stuff. You know that it’s a hard job. Capitalism is a hard job. So that’s why neither one of us wants to do it. Yeah. And if you’re wrong, you know, a whole bunch of people lose their job and their livelihood and they may try to kill you.

Yeah. Okay, so, yeah, the means of production. I don’t want to be a, I don’t want to be a capitalist, but what can I do? That’s what’s going to happen. Well, you, like I said, you can maintain the gentleman’s portfolio and maybe pay someone else to be the capitalist for you. So. Okay, I’ll do that. I think that’ll work. The, you know, the, the. The Keynesians make the mistake. I wanted to bring this up before. The Keynesians make the mistake. The way money move when gold is circulating, gold and silver, when it’s circulating the system, that’s colloquially called the velocity of money.

The Keynesians make the mistake of saying, oh, that is a thing that we can control. So we can. We can decide how fast the velocity should be going by, you know, pulling this lever or pushing that button. That is, that is a fallacy. The market will decide how fast the money should be flowing, you know, between people. And when you increase the velocity unnaturally, you cause. Once again, you cause a bust at the end where the velocity will slow down the velocity. If you have a deflationary crash, the velocity slows down to zero because everyone’s hoarding and no one wants to part with it until the prices drop so much that people will part with their gold and silver.

And if you have a hyperinflationary crash, velocity goes to infinity because people are dumping their currency as fast as they possibly can. And so that when you try and control the velocity of money, you inevitably end up in one of those two situations where the whole system breaks apart. Yeah. So when, when I just wanted to put this in there, when silver hit $50, I thought, this is entertaining. And then we’ll go to. To why the amount of money doesn’t matter and why the amount of money that China has doesn’t matter at all. China’s not going to lead anything.

China is not a leader. They are a follower. They copy. That’s their nature. That’s their culture. So when the west falls, which it will, it’s going to be scary. China is not going to emerge as the leader. It’s just not happening. There. There has to be a leadership culture, which I think the west, some of the good parts of the west still has. We’ll see who it’s going to be. It’s not going to be China. I’m not, I’m not even the least bit worried about that. They’re going to. They’re going to implode. But my. When Silver hit 50, I was at the.

I was on the Temple Mount for Sukis, praying with the people of my town. We all went up as a town in a bus. I didn’t go on the bus. I took my car because I wanted to spend some time in Jerusalem afterwards. But we went up. It was a nice group. And silver hit 50. And it was my birthday. It was my Gregorian birthday, which I don’t really count as my birthday. October 9th. My Hebrew birthday is 2 Cheshvan, but whatever. It was my Gregorian birthday and Silver hit 50 while I was there praying at a golden domed dome of the Rock, which is.

It’s not a mosque. It’s. It’s. It’s. People think it’s a mosque. It’s not a mosque. It’s just a building that covers a rock. The mosque is on the side. And then when we went down, I had arranged a meeting with a friend of mine who had took. Who had taken some of my silver for safekeeping after October 7th. Because after October 7th, we had no idea what was going on here. We didn’t know if he would have to evacuate if Hezbollah was about to invade, and we have to, like, run out of town. So I gave him a whole bunch of silver, and he gave it back to me on that day.

Just coincidence that it happened to be 50. But I’m walking around with a backpack full of silver, not full of silver. It’s like, you know, a good amount of ounces of silver, heavy. But I can carry it on a day. When silver hits $50, I’m like, sometimes I see God in my life and, you know, were you. When you’re walking around the backpack, was it just like. No, no, no. It was. It was in plastics. Plastic stacks. Okay, good. I was gonna say, you’re just inviting robbery. No, it was. It was heavy. I was armed. I had a gun.

I had my gun on me. When I go to. When I go to Jerusalem, I always bring my gun. And I just thought it was. It was one of those times when. When God is, like, sort of, like, winking and saying, you get it? This is fun. Like, on my. I’m trying to calculate how much money is on my back or how many dollars are on my back. Whatever it was. It was. It was kind of surreal. And my. My kids all know about silver, and they’re. And they know, like, that there. It’s in my back facts, like, looking at me like, silver, 50 head off.

Is it 50? I’m like, yep, it’s 50. Amazing. Yeah. All right, so now let’s just. Now let’s talk about why that doesn’t matter at all. Okay? Why doesn’t it matter? Who cares? So there we. The. This sphere is constantly full of people saying, oh, China’s. China’s taking over. They have all the gold. We’re totally screwed when this blows. We’re all going to be enslaved by China. And now they’re going to sit on there, they’re going to sit at the beach drinking pina coladas and we are going to be slaving away for pennies and never. This is, you know, never going to resolve itself and we’re all.

We’re all screwed and we might as well, you know, might as well just give up now. The best you can do is dig a hole and go die in it. It’s not true in any possible sense because money as a monetary medium, the amount of money circulating, the system only determines how much each marginal thing costs. So if there’s a. If you have a system with a lot of gold, I mean a lot of gold in it, then the prices in gold terms are going to be very high because there’s a lot of gold floating around.

If you’re in a system that doesn’t have a lot of gold in it, then the prices are going to be very low in gold terms. The way I try and explain it is if you have two. Let’s say you have two countries, you have X and y and they are identical for all purposes except X has more gold than y. So the crops, you know, the spring comes and people plant their crops and the corn grows and they both, the. Both countries get the exact same amount of sunlight. Both countries have the exact same amount of fertilizer they sprinkled on the crops when the corn comes due to harvest.

The only difference is that the corn in X is a lot more expensive than the corn and y. So if, if the ex. If the king of Exia is a lot allows his subjects to trade with Wyistan, then the people in Exia will say, you know those wy standings, they have really cheap corn way cheaper than ours. I’m going to buy some of their corn. So in the Weistanians will say, oh goody, we’re getting. You know, these guys are offering gold for our corn. Let’s do it. So they’ll send the gold over and the corn goes over this way.

Now what happens to the corn in Wyistan? It becomes more expensive because the a the money, the money supply has gone up and b, there’s less corn. So now the, now the corn and the corn prices equilibrium, the two countries and a bunch of gold has moved from X to. Yeah. Next year comes around the new. A new set of corn is planted. But guess what? Now the gold in the two countries is the same as it is the same. So now the gorn. Now the corn and gold terms Is, is the same price in both countries.

That’s all that happens. So the fact that China has a bunch of gold, they might have a good couple, they might have a couple of years. I mean, this is, this is assuming the CCP is going to let the gold out of the vaults and it’s going to let the people trade internationally, which they never do. So assuming the ccp, you know what, we’re going to institute Rothbardian gold standard in China, then the Chinese people might have a good couple years where maybe they get to sit on the beach and drink a pina colada because they have a lot of gold and they could import a bunch of stuff, but that’s really going to be it.

And then the gold’s going to equilibrate to the rest of the world and the prices are going to equilibrate because money always moves to where it’s demanded the most. Now if the Chinese government does what I think it’s going to do, which is close its borders and not let its gold leave, then the Chinese people are going to not have as much, they’re not going to have as much stuff because they can’t import things from the rest of the world. But they’re going to have more jewelry. So they’re going to have nice, they’re, you know, a Chinese, it might be a thing where the Chinese man has, you know, five gold rings and that’s considered fairly standard.

And the rest of the world’s like, wow, they have a lot of gold in China that we can’t get at. And then the rest of the world has more stuff, but not as much gold. So yeah, you know, prices will just be lower and the only thing we won’t have is, is we’ll have less jewelry. And I don’t know about you, I can live with that. Rafia. Jewelry, Jewelry is not a thing that I need. Yeah, yeah. Okay, so let me, let’s let me put it this way. When, when I’m gonna, I’m gonna give you the same answer, just from a little bit of different angle.

So when people say China has so much gold and that’s so much of a threat and they’re going to take over the world. Okay, what, what they mean, but I don’t think they know that they mean. What they’re really afraid of is let’s. So the dollar collapses. The whole inflationary dollar based system is now kaput. And then it, so now they imagine that this inflationary system as we know it now moves to China and all of A sudden, China is the base of the pyramid, and they can inflate, and then once they can inflate, they can buy everything.

And then they become the, the, the international superpower. And in a world as with China, as the international superpower would really mamish. Be a very scary world. I don’t want to be. I don’t want to live in a world where China is the superpower that just, just take, take me out, you know, I don’t want to be here. But it’s not gonna happen. I’m not even worried that’s gonna happen. Because the error in that thinking is that, okay, the dollar collapses, this, that’s going to happen. But then that means that not, not just the dollar collapses, but everything underneath the dollar collapse, which includes the yuan.

It’s not like we are in a world now where nobody trusts any credit because people have decided that gold is money again. And, or they’ve recognized, not, not that it’s again, but they’ve recognized the gold is actually the money, dollars is credit, and they’ve abandoned the dollar. And, and now you’re telling me that in that world they’re going to say, well, America screwed it up. I think I’m going to trust the Chinese Communist Party now for the same system. And I’ll give them the right to inflate and I’ll give them the right to just like, keep printing more and more yuan so they can buy everything.

No one’s going to trust China if nobody trusts America. Nobody’s going to trust anybody. It’s just going to be money. And so if China has more money, then they’re going to have to spend the gold, not the yuan on top of the gold, and keep the gold. They’re going to have to take the gold and ship it somewhere to get stuff. And that’s fine, that’s good. That’s not going to threaten anybody. There’s going to be nobody in charge. There’s going to be no international power after this, not for many generations. But I don’t, I don’t know who’s going to be in charge of whatever region China’s.

China might be in charge of its region, or China might just break apart entirely and the whole Chinese Communist Party may collapse. But just like the structure of production and the centralization of capital, it breaks into pieces because the dollar collapses, because credit collapses. And you need a lot of credit to centralize these systems. It’s the same with political orders. All the power centers are going to disintegrate into different power Focal points around the world. And then it’s going to take a while for someone, it’s going to take a long time for these powers to gather it together again.

And it’s going to need inflation for that. So after inflation, no, China is not going to be in charge. You don’t have to be afraid of that. Their gold supply is completely irrelevant. Cosign. Okay. And I do think, I do think they’ll break apart. I, I don’t see, I don’t see the CCP surviving. The only reason the CCP even survived Tiananmen was because President Bush showed up with a, with a whole bunch of, of credit for China. They were like, you were going to make you most favored nation status. We’re going to bring you to the World Trade Organization.

You know, if they hadn’t done that, China would have, you know, the CCP would have collapsed in 1989. So you know what, once again, huh? I hate the Bushes so much. I know there, yeah, wait till you find out about the Clintons. I, I, I know, yeah. It’s, it’s, the USSR would have collapsed probably in the 60s if America hadn’t bailed them out with like grain shipments. And so I don’t know why we do this. Well, I do know why we do this. Inflation. But you know that it makes no sense. We keep, we keep like these sock puppet enemies alive so we can justify blowing up third world countries.

It’s like, well, they’re going to be communist if we don’t. Sock Puppet Enemy would be a good name for a band. Yeah, there you go. Sock puppet enemy. All right. Anything else? I think, I think we covered that. Now the question is who’s going to listen? I don’t, you know, people, people don’t necessarily listen or follow the logic of what we’re saying on that, but I promise viewer, it is absolutely true. The amount of gold in a system doesn’t matter now it does matter. The threat is the ability to inflate. No one’s going to have that.

That’s, that’s all you need to know. No one’s going to be able to inflate credit over money because no one will trust anybody’s credit. That’s the bottom line. I think it’ll, I think it’ll last for many, I think the rest of our lives are probably going to be very little credit and a lot of money. So I, whatever that world looks like, the world’s gonna be very different looking place. I’m not even, it’s kind of weird like I’m waiting to pay the milkman in silver again. You know, it’s gonna be good. We’re gonna. We’re gonna enjoy it.

I hope so. I hope so. All right, I think that’s it. Are you good? Yeah, I’m good. All right, we’ll see you all next time. I’m gonna head to a barbecue now. In a tent. In a hot. A tent has a. Has a. A point for a roof. This is a flat roof. Okay. It’s a hut. Hut. All right, well, enjoy your barbecue. In the other. It’s a tabernacle, and it’s classy. It’s a tabernacle, and it’s classy. Yes. Okay. Have a good week.
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See more of Rafi Farber on their Public Channel and the MPN Rafi Farber channel.