The Silver Journey of Chris Marcus Can You Handle the Truth? | Rafi Farber
Summary
Transcript
But we have a system where money is debt. They’re the same. They’re opposite sides of the same coin. So if you cut the debt, you’re going to cause a crash. So the debt has to keep increasing. And if it stops increasing, then everything falls. Hey, guys. Rafi here from the endgame investor and got my good friend Chris Marcus. I think this is the first time you’re coming on my channel.
Yeah, it is my virgin experience on the Rocky show and excited to be here. And obviously you’re making a lot of good videos, which I think help people understand a lot of things that are happening now. Not always as straightforward and a lot to digest, but appreciate everything that you’re doing there and having me on today and looking forward to digging in. Welcome, Chris. I just wanted to ask you a few questions about your personal story about how you got into this whole mess.
Because we all have different stories and we all come from different directions. And I want to take the more human angle into who you are and what you did. You’ve been actually into this more longer than I have. Your channel is older than. I don’t know how long you’ve been in this, but you talk about September 11 affecting things. Talk about 2008 affecting you. I remember you told me a story of you were an options trader for some big bank or something, and then one day you just walked out of there or ran out of there or something happened to you.
You thought of something. Were you having nightmares about silver? Did you know that there was a problem in the money? How did you come to be a silver guy? Was that a dream? Did you have Musa from your parents or messages from your parents? And what money is? Or is this something that just came to you? You want answers? I think I’m entitled. You want answers? I want the truth.
You can’t handle the truth. Well, actually, if you want the true answer, I was born in 1978. So by the time I was two and silver was spiking on its way up to was loading up some comex contracts and speculating hard and buying silver from people who were selling at the top there. Did you order the code red? I did the job. Did you order the code red? You’re goddamn right I did.
Missed out on the 1980s. Wasn’t thinking about silver back in 2001. Although as you mentioned, I was trading equity options. Fortunately, not for a bank. In hindsight, equity option market maker called Susquehanna International Group. And this was shortly after I’d finished business school. Started there in 2005. And by the time things started unraveling in 2007, it was fascinating to me that it seemed like this big crisis was emerging that no one had really seen in advance.
In fact, in my first year trading options, one of the companies that I had was countrywide. So I remember back in February of 2007, this was right when I was getting started. That was the first time subprime issues flared up. Interestingly, I had a random position in my book at that time. And one night when we first started hearing about subprime, PNL shot right back up. And then a day or two later, the news was saying, oh, it’s no big deal, just a one off event.
So that came back in, although that was when I had first heard about it, obviously, sitting on the american stock exchange back then and watching somewhat firsthand as these things were unfolding throughout the summer of 2007. I know a lot of people think of the housing bubble as a 2008 event because that’s when Lehman collapsed, although actually topped in 2006. Yeah, the housing prices topped in 2006. 2007 was already one year into it.
Yeah. And especially when, in terms of when market volatility picked up, that was very much happening in 2007. And obviously, you had another volatile year in 2008. And remember finding it interesting how you had Ben Bernanke at the time saying subprime was contained and everyone thought things were good to go. And there were no issues. Which eventually led me to gold and silver, because, in fact, the guy who I was his clerk when I was training in 2009, April of 2009, that was when he sent me a Peter Schiff video, which was my introduction to all this.
And what really stood out to me was reading his first book, Crash Proof, which came out in 2006. And, I mean, he really described to the letter the issues that were happening, what was going to unfold, why there were problems in housing. Of course, he talked a lot about gold and silver and the Federal Reserve, and that made quite an impact on me, someone who had seen it in advance and seemed like a logical thing to do, rather than just following the crowd of people who’d gotten clobbered by it, studying the people who had seen it coming and predicted it accurately.
So that led me into austrian economics, obviously at the same time that the Fed was lowering interest rates, starting quantitative easing. And I just noticed it wasn’t just Peter Schiff, but uniformly anyone who had really seen what was building and was able to diagnose that they were all talking about the same things with the cycles that the Fed goes through, how more money continuously gets printed, how each subsequent cycle, you need more and more printed money to hold it together.
This conversation with Chris Marcus of Arcadia Economics is brought to you by Miles Franklin precious metals. Today’s specials. This week’s specials, in fact, are 1oz gold krugerands, only $59 over spot. Call eight five five, game end or email endgameinvestor@milesfranklin. com also this week being offered are 1oz silver 2023 britannias, a 50 coin minimum, while supplies last only $3. 15 over spot. Once again, call eight five five, game end or email endgameinvestor@milesfranklin.
com and one of our guys will get in touch with you. Perhaps the part that was easy for me to see back then was that the US debt load was. I still have yet to see any indication that this is going to be reversed. I think that’s the easiest part for people to see. Certainly it had an impact on me, and that really led me to getting into gold and silver and learning a lot about it.
Studying, reading, austrian economics. Chris, let me interrupt you for a second. Just keep going on this topic. But you just tweeted out a tweet, I think, a few minutes ago, where you quoted somebody that was saying. You had said that even if we balance the budget, even if the federal government balances the budget, the problem wouldn’t go away. But that’s true. But it’s even more true than you’re saying there, because what you just said is that every cycle, every subsequent cycle, you need more printed money to keep it all together.
And then on the other side, but the same coin, the same silver coin, is that the debt keeps going up and up and up. But we have a system where money is debt. They’re opposite sides of the same coin. So if you cut the debt, you’re going to cause a crash. The debt has to keep increasing. And if it stops increasing, then everything falls. Because money is debt, or at least currency is debt.
I don’t want to say money is debt. Silver is money, but currency is debt. These days, most of it. What you’re saying is it’s all sandwiched together and it’s all inseparable. I just wanted to ask you a question about austrian economics. What did you start with? How did you start your education in that? Well, I was overdosing on Peter Schiff for those first couple years. Back then, we didn’t have the Arcadia channel or the Rafi Farber channel, so we had something called King World News.
Eric Sprott was talking about this. Back then, a bunch of other folks started reading some of the other austrian economics authors von Mises Brothbard and I found it interesting how you could see that there was this pattern that went along with what was happening in the monetary cycles, that as I looked at different economies or different points in history, you could see that if you followed what was happening with interest rates and credit creation, that it wasn’t just a phenomenon specific to the housing bubble or the US.
But for reasons that make a lot of sense that you do this anywhere, you’re going to get the same effect. And the way I would often explain it to people, that maybe I was talking about this for the first time, if your break, even for a mortgage, you can afford 4% interest. Okay, so the Fed comes along and says, we need to stimulate the economy, lower interest rates 2%.
People think, oh, this is great, can afford the house and they buy the house, which the only problem is what happens when interest rates get normalized. In the rare cases that they eventually do and interest is 5%. Well, you have a lot of debt go bad. And that’s a simplified example, but we’re seeing it happen on a bigger scale. We saw the same thing happen to some of the banks last year, which I know you talk about plenty on your channel.
And it’s not a one off phenomenon that’s unexplainable. I mean, there’s a pretty clear cause and effect. And to what you said about that quote in that tweet, something I’ve been thinking about a bit more interesting, a bit more lately. That is interesting is just how even if you balance the budget now, so much of that GDP that we see created is based on the government running a deficit.
So if they balance the budget, you’re going to have a big drop in GDP, a big drop in tax revenue. I don’t know. Yeah, it’s a snake eating its own head because these definitions are completely circular. We’re talking about debt in terms of percentage of GDP. But the higher the debt is, the higher the GDP because the money just circles back into it. It’s a hurricane that keeps cycling and we’re wondering where the end is.
And there is no end until the whole thing just implodes. And we know that logically. But the problem that you and I keep encountering, and people like us keep encountering, and we can’t deny this, is that we know where the end is, but we don’t know how deep it goes. We’re sitting on top of this pyramid or at the bottom of it, really, because we’re the gold and silver guys and we’re waiting for it to fall over, but it just keeps stabilizing itself.
And I think there’s two problems to this. One is that the system really is that gargantuan? Fine. That’s one. So we don’t know inherently when it’s going to fall over. And second, the fact that we always have these constant pings and WhatsApps and constant news and tweets that we’re just never freed from it. It makes everything feel like it’s going on longer than it actually is. Right? Because the time between, let’s say, 2005, 2008, if we were involved in finance, it felt like a fairly long time.
But now, the time between, let’s say, six months ago and now we’re getting all this information all the time, it makes it feel like years. And even though it’s going to fall, and I can’t tell people when, and they keep asking me, and I just say, look, this is logic and it has to be this way. And what I’m waiting for is personally, the reverse repo is running out and the spare tank running out.
And then I really don’t know how it continues after that. It could. But even if it does, if I were personally to, let’s say, give up and sell my silver and go into Nvidia or whatever it is, I would feel so empty, especially if I won, that I wouldn’t be able to do it. I would feel so spiritually undo, because I would know it’s wrong. I can’t do it.
Well, yeah, you better hope someone doesn’t chop out that part. And there’s a quote of, rafi sold his silver into Nvidia. I know what you mean, especially the timeline of it. I have been shocked that when I left the trading floor back in 2012, I didn’t think that we’d still have a similar arrangement that we have now, twelve years later. On one hand, I suppose, what do you expect the Fed and the treasury to do? They’re going to patch things up and keep it going as long as they can.
I mean, you have to expect that. And when things start to get rocky, like we saw with the banks last March and April, there comes the fed with another facility. And if BTFP ends and you have more issues, I would assume that they’re going to do the same thing again. So I think the timeline gets really tricky for people because you see reasons why something should happen. Yet what is the timeline of that? Is that another five years? Another ten years? I think people have been surprised at the ability to just add printed money now, in the past couple of years, we’ve seen inflation or the rise of price increases already.
Certainly we got a bigger dose of that in the last couple of years. My guess is that ultimately the Fed is going to come back in no matter what happens. We’ll do everything possible to make sure that the treasury market continues to function, and most likely we’ll be seeing more money printing more price increases until eventually you get to a point where this just can’t stand it anymore.
Now, is there a breakpoint somewhere in between there? Obviously, we see what’s happening with the BRICS and a lot of other countries that are now not just expressing their feelings about the system and the inequity of it, but making arrangements to trade outside of the dollar, creating infrastructure to trade in local currencies. And you see the gold involvement. Obviously, when Russia went into Ukraine and then a couple weeks later, they had the temporary gold backing.
Some of their officials have, including Sergey Glaziev, has written and talked quite a lot about how he sees gold being involved going forward. I think that’s still being debated over what the ultimate structure would be. But you can see a large portion of the world is now not just holding their breath, but they’re saying how they’re feeling, and they’re making preparations to be prepared for that. Perhaps one thing to add to that that I think speaks even more to it.
You now have the states in the US doing the same thing. I mean, they’re changing the legislation to remove sales tax to bring back gold and silver as legal tender. And they’re talking about the same reasons that you are, that Russia is that chinese people are. Did I read that Kansas is doing that, or was it a different state? Kansas had an announcement just a couple of days ago, and it’s becoming quite commonplace as you see a variety of states, I think it’s up to 43 now, have removed the sales tax.
And I mean, they’re worried about the same things that everybody else is. Look along these lines of a timeline and what people are doing and what states are doing. I think the best way for the United States to survive in any sort of political entity is for states to do exactly this, to section off their monetary systems, to have a store of gold and silver for their citizens in whatever state they are, because I don’t see the United States surviving as a federal entity or at least a strong federal entity, maybe a loose one, if they survive a civil war or something, or you got to kick California and New York out and keep Florida.
But however, it works. I don’t know. But if you take yourself back to 2007, 2008. Right. So that was at the time you were waking up. I hadn’t woken up at that point. I was just like, wow, that was weird. And I had just gotten married. I was 24 years old. I didn’t really know much about finance, but I was looking at it. And then Ron Paul had just started to become a household name, but only among the already awake masses, like the very small section.
The 2008 Ron Paul campaign wasn’t that big. And then 2012, it got bigger. But now we’re seeing the whole gold and silver consciousness and the understanding, not necessarily that gold and silver are money. Maybe they don’t get that, but you have the whole bitcoin crowd, which I don’t agree with them, but I understand why they believe what they believe, because they’re looking for a monetary alternative. People understand the money is the problem.
Even the bitcoin people understand the money is the problem. They just don’t understand what money is. Or at least I disagree with them about that. I don’t want to call anybody names or anything, but the point is that we are in a very different situation now than we were in 2008, because there is mass consciousness that something is very wrong here. All over the world in 2008, people were just starting to understand it.
Only just starting to. And with that, we’re seeing wars everywhere. We’re seeing just society go completely nuts, which I hadn’t gotten that sense in 2008, that everyone was just totally crazy. There’s no mainstream media to speak of anymore, which is why people like you and me have to speak, because nobody else is saying anything. And we’re kind of like feeding off of the spring of Ron Paul. He’s more of a generalist libertarian approach, and so is Peter Schiff.
Like, Peter Schiff doesn’t go that deeply into the concepts of things, and he’s the gateway drug. And then we try to go more deeply into it, which is, I think, what we are. So I’m rambling. But the point is, my question is, what do you see as different from when you started to wake up in 2007 to now, the consciousness about gold and silver? Do you see that the market has changed, that people are.
Do you really think people are really stacking now as opposed to 2008, when they just started to think about it? And I can refer to the paper silver numbers in 2008. Like, paper silver got really popular in 2008 to 2011, paper silver was like the thing. And now that gold is at very near all time highs, nobody cares about paper silver or gold anymore. It’s all central banks and physical stackers.
I don’t see anybody else buying any. Yeah. So you’re asking, is there more of an awareness now of gold and silver and some of the issues going on, more of like a general feel? What do you see as the major difference between 2008 and now in terms of consciousness? Well, I think the inflation over the past couple of years has certainly opened people’s eyes, especially after hearing Jerome Powell say that it was transitory, which so far has not turned out to be the case.
And I’m not sure that we’re going to be getting back down to that 2% mandate anytime soon. So I think that’s another level of people seeing that there is an issue. Obviously, in 2008, when things go bad, that’s a good way to catch people’s attention. You didn’t have back in 2008 as many people on YouTube who were talking about things like this. And I think the last time I looked at the Silver Institute numbers, that in the past couple of years, we’ve had higher retail investment into the metals than the second half of the teens decades.
I think there’s a growing portion of people who are thinking about silver and gold and being exposed to these things. How much bigger is it than in 2008? I would imagine it’s bigger. Perhaps it probably to people like you and I are the ones watching your show, who are thinking about it and in it every day, perhaps. Seems like there is more attention around it versus what is the actual percentage of people in the population who are actually thinking about this.
I think it’s still quite small. I think we’re under. What is it like less than half a percent that actually have gold or silver in a portfolio. So what concerns me a little bit is that does it take a crisis to really open people’s eyes more often on a higher level about this? It always does. It always takes a crisis. The question is how many people are going to get in before, and the people that all of a sudden realize the truth once it hits, they’re going to be relying on people like us.
And the more people like us that have a little bit of silver to circulate, it’s going to be better for them. Our job is to save the people who need our help when it comes to that. This sounds like very hubristic when I say it, but I don’t say it with a feeling like, oh yeah, I’m going to come in and I’m going to help everybody. I used to think that way in 2012, 2013, when I started stacking, I’m like, yeah, I’m going to be generous.
I’m going to help everybody. And now I’m more terrified. I want to use the word terrified. I can sleep at night, I’m okay. But it hit me, especially in 2020, that this is not going to be a walk in the park, that people are really going to go crazy as they have the medical responses to certain things that I don’t want to get into. But I’m sure you know what I’m talking about.
And just the way that people relate to politics and that they can’t talk to each other, they don’t even know how to anymore. Vocabulary has been shrunk and people don’t even know how to say words. People don’t call anybody anymore. They just text. Communication has got the. We only have derivatives of derivatives of derivatives of communication, just like we only have derivatives of derivatives of derivatives of money.
And that leads into my last question. Okay, so we want to see silver at $666 or whatever it is, $1,000 an ounce. Do you think about this at all deeply, in terms of like, okay, I’m going to wake up in the morning, silver is going to be $1,000 an ounce. What are you going to do that day? Are people are going to be just like, the electricity is going to be out.
People are going to be like running and screaming in the streets, don’t know what to do. Their dollars aren’t worth anything. And they’re going to come knocking at your door because you’re the silver guy. What are we supposed to do? Well, I have thought about that, where on one hand you hear the viewpoint that governments don’t want to see gold and silver prices skyrocketing, because then that’s an indication that there’s people losing faith in the currency, which I think there is a lot of.
It’s the definition that people are losing faith in the currency. It’s not just an indication that is the loss of faith. Yeah. Although I wonder back in 2011 when gold got up to $1,900, silver got up to $50. Sometimes I wonder the other side of that, how many people were even aware of it. Not many, I think, more. So what creates a problem is that if you see overnight spikes in pricing or the cost of food going up, that’s what I think gets people’s attention, what they saw the last couple of years.
I think people are more open to hearing about gold and silver. I think where people get a little not sure what to think with silver, where you still have the price on the comex, around $23. So it’s like we had this big inflation and silver didn’t respond as much. Gold has been responding plenty. So the day that we wake up and there is a big gold or silver price, I guess that depends on a lot of other things that are going on.
Do we have a civil war by then, or is the population still much like it is today? I sure hope we don’t get to the point where it’s like people are looking for the guy that has gold or silver in his house. I tend to think maybe that’s the optimistic, hopeful part, that we don’t have an outcome like that. But if you have a stock market crashing or real estate prices are going down at the same time that’s happening, then I think that would have more of an impact and I guess we’ll see.
That’s a bit of the unknown at this point. But yeah, it’s a challenging thing where you can see what should happen over the long term. Yet, I don’t know. Again, maybe it takes five or ten years before you really see a spike like that. So that’s why I think it’s helpful to just look at the things that are building. I mean, now we’ve gotten to the point where the primary silver miners, a lot of them, price of silver is right around their cost of production.
We have the silver Institute numbers showing that we have a deficit for large deficit. For the last couple of years. We’ve seen metal come out of the LBMA. We’ve seen metal come out of Comex registered. And it’s interesting. Obviously, I’ve talked about that a lot. You update that when you do your Friday show on channel here. And yet that really stopped around November of 2022. So we’re over a year where the LBMA and Comex levels have stayed relatively flat.
Although in the past year we’ve seen metal continue to come out of the etfs like GLD and SLV. So when does that become an issue? That’s another one of those timing things that’s pretty hard to say. But certainly if we get to a point where their shortage of silver develops and you have companies scrambling to get what they need, and if you have monetary concerns at the same time, I guess that would be the perfect storm in silver that you would think over a long enough time horizon, the conditions that are in place now increase the probability of something like that happening.
I wish I could say, oh, well, we’ll see 50 or $75 silver in a couple of weeks. Unfortunately, it doesn’t work like that. And whether people like the way it’s priced on the Comex or not, that is the system. So balancing all those things together and putting a plan in place that leaves you in a good position so that you’re not needing an event by a certain timeline yet if an event, whether monetary or something with the actual silver supply happens, that can work to your advantage.
So one more question. Where can people find you and what would you want to point them to? I just want people to know that I have a silver chopper Ben, that I will be getting here in the next few weeks to Israel. It’ll be brought from the US and I’ll have it in my background. Ben Bernanke and his helicopter Ben. Tell people about helicopter Ben, where they can get one and anything else you want to tell the viewers.
For the very few people that know you through me instead of know me through you, I’m sure they exist, but they’re very rare. Well, behind me is silver chopper Ben. I remember back actually was in 2011 when I first had the idea of minting Ben Bernanke into silver, throwing $100 bills out the window, which it was his own quote that all of this came from. So we had a little fun with that and found an artist who was able to mint Ben into silver form.
And it’s nice you can see his smile and see some cash coming out. Fortunately, we’re still finding someone who can make these in the US. So they are not available just yet. We’ve had them coming from Hong Kong and China and through Canada and then back to the US, which has made things a little bit more complex. But we’re working on making him available. So you can have Ben Bernanke on your desk in the near future.
Happy to get you one. And aside from silver chopper Ben shenanigans, on a more serious note and part of the Arcadia economics channel where we’re grateful to have you doing your report every Friday. We have just about everyday silver content where we’re digging through the things that are impacting the market, that people are looking at, interviews with experts and these giving a people a home where they can find some information on thoughts on how to approach this, some of the issues that are out there, why people in many cases are turning to gold and silver.
And I guess the last part I’d like to add is I think I’ve done a good job of not telling anybody else what they should do, which I find people generally don’t appreciate, but at least laying out the things I’m seeing, why I’ve chosen this path, and why I’ve chosen to invest in silver and the benefits that it can hold. Especially in the midst of everything else that’s happening right now.
Yeah, look, we’re going to be proven right. I don’t want to be proven right, but we’re going to. I know it. And I hope to see you healthy and full on the other side of it. Because when it does happen, I think communications are going to go down for a little bit and we’ll reconnect on the other side. Until then, I’ll keep doing my show on Arcadia. The silver report coming out tomorrow.
I still got to edit mine. I finished recording it a few hours ago. And I can’t wait for my silver chopper Ben to arrive here. And it’ll make me feel a little bit better, like I got you at my side. Well, he’ll be on his way soon. I’m excited you’ll have one. And again, I appreciate everything that you do, not just for our channel, but it’s been really nice to see how your channel has grown.
And you do really good work. And people appreciate that. And I think it’s important at this particular time. So thank you, Ralphie. And thanks for having me on. Cool. Chris, I’ll speak to you soon. This conversation with Chris Marcus of Arcadia Economics is brought to you by Miles Franklin, precious metals. Today’s specials. This week’s specials, in fact, are 1oz gold krugerands, only $59 over spot. Call eight five five, game end or email endgameinvestor@milesfranklin.
com also this week being offered are 1oz silver 2023 britannias, a 50 coin minimum, while supplies last only $3. 15 over spot. Once again, call eight five five, game end or email endgameinvestor@milesfranklin. com and one of our guys will get in touch with. .
See more of Rafi Farber on their Public Channel and the MPN Rafi Farber channel.
