WEBVTT NOTE How I See the World Today: Question and Answer Period 1 00:00:00.000 --> 00:00:04.560 You know, Jimmy, you mentioned what happened in the 20s and the 30s, and of course there 2 00:00:04.560 --> 00:00:09.680 was a horrific world war that was also part of this process. The American neoconservatives 3 00:00:09.680 --> 00:00:14.300 for a long time have targeted China, they've been like a hate China campaign, they want 4 00:00:14.300 --> 00:00:19.880 at least a new Cold War, all the protectionism, currency business and so forth. What do you 5 00:00:19.880 --> 00:00:22.880 see happening in those sorts of political developments? 6 00:00:22.880 --> 00:00:26.780 Well, unfortunately, it's right. As you all know, there are many people who would love 7 00:00:26.780 --> 00:00:35.780 I'd love to bomb somebody, anybody, Iran, China, let's pick somebody, and let's have another war. 8 00:00:35.780 --> 00:00:41.780 I am not particularly keen on any wars. I know that nobody's ever won a war, even the people who think they've won wars. 9 00:00:41.780 --> 00:00:49.780 And wars are massively destructive of capital and progress and human beings, so they're not a good scene. 10 00:00:49.780 --> 00:00:55.780 Unfortunately, wars have been going around for at least, as long as we know, thousands and thousands of years. 11 00:00:55.780 --> 00:01:01.180 For people who will tell you, I have not done the homework, but people will tell you that 12 00:01:01.180 --> 00:01:06.420 whenever you've had a shortage of raw materials in the world, it has led to war. 13 00:01:06.420 --> 00:01:11.940 And as Gary mentioned before, in my view, we're in a period where shortages of raw materials 14 00:01:11.940 --> 00:01:15.280 or commodities are becoming more and more acute. 15 00:01:15.280 --> 00:01:21.400 And if those historians are right, then, unfortunately, we will have another war. 16 00:01:21.400 --> 00:01:24.820 It makes logical sense that shortages lead to war. 17 00:01:24.820 --> 00:01:28.980 And what we do know, even if whether that's right or wrong, we do know that throughout 18 00:01:28.980 --> 00:01:36.780 history when you've had a dominant power, especially a stagnant or declining dominant 19 00:01:36.780 --> 00:01:41.820 power and a rising power, they've always clashed. 20 00:01:41.820 --> 00:01:48.020 So unfortunately, for whatever reason, I suspect we will have more wars. 21 00:01:48.020 --> 00:01:54.460 I just hope that a hundred years from now, the trend is not that way. 22 00:01:54.460 --> 00:02:00.380 I see no reason for us to go to war with China, but the guys in Washington think differently 23 00:02:00.380 --> 00:02:03.420 from me, as you well know. 24 00:02:03.420 --> 00:02:13.220 For what it's worth, China does not have a history of being a terribly aggressive against 25 00:02:13.220 --> 00:02:14.220 its neighbors. 26 00:02:14.220 --> 00:02:17.940 They really have rarely, if ever, gone to war with their neighbors. 27 00:02:17.940 --> 00:02:19.940 They have slaughtered themselves many times. 28 00:02:19.940 --> 00:02:25.940 They've had internal silver wars, but they've never really gone to war a lot with other people. 29 00:02:25.940 --> 00:02:31.940 In Europe, as you know, European history is essentially just a story of one war after another, 30 00:02:31.940 --> 00:02:33.940 where they were fighting each other. 31 00:02:33.940 --> 00:02:39.940 I don't see a reason for a war with China, but they want to bomb somebody. 32 00:02:39.940 --> 00:02:43.940 Speaking of things they're not going to be taking your advice about in Washington, 33 00:02:43.940 --> 00:02:47.940 do we face a QE2 after the November elections? 34 00:02:47.940 --> 00:02:52.940 Well, as I said before, all Mr. Bernanke knows how to do is to print money. 35 00:02:52.940 --> 00:02:56.940 That's all the rest of them seem to know is to print money. 36 00:02:56.940 --> 00:02:59.940 It's not good for the world to base in your currency. 37 00:02:59.940 --> 00:03:05.940 Many countries in history have tried to revive their economy by debasing the currency. 38 00:03:05.940 --> 00:03:10.940 It has never worked in the long term. It has never worked in the medium term. 39 00:03:10.940 --> 00:03:15.940 Sometimes it works in the short term, but that's all they know. 40 00:03:15.940 --> 00:03:21.940 Mr. Bernanke, as I said before, does not understand economics or currencies or anything else. 41 00:03:21.940 --> 00:03:23.940 It's staggering how little he knows. 42 00:03:23.940 --> 00:03:28.940 In fact, as you all know, he came out of Princeton, Krugman came out of Princeton. 43 00:03:28.940 --> 00:03:31.940 Thank God I didn't go to Princeton. 44 00:03:31.940 --> 00:03:34.940 Can you imagine? 45 00:03:34.940 --> 00:03:38.940 I went to Yale, which was bad, and Oxford, which was bad enough. 46 00:03:38.940 --> 00:03:41.940 Some of the stuff they tried to teach me. 47 00:03:41.940 --> 00:03:43.940 Fortunately, it didn't work in my case. 48 00:03:43.940 --> 00:03:53.940 No, that's what they're going to do. They're going to print more money. And I would urge you all to learn about putting your money into real assets or in other currencies besides the U.S. dollar. 49 00:03:53.940 --> 00:04:08.940 U.S. dollar will not go down dramatically every day, every year or not. I mean, there'll be big rallies in the dollar. But please do learn about protecting yourself because the way to protect yourself throughout history has been either in sound currencies or real assets. 50 00:04:08.940 --> 00:04:12.940 You mentioned one before. There are lots of others. 51 00:04:12.940 --> 00:04:15.940 There was a young man who said to you today, should I buy silver? 52 00:04:15.940 --> 00:04:20.940 And you said, you're not selling your silver, but you'd advise me to buy rice. 53 00:04:20.940 --> 00:04:23.940 Well, I said to the, yeah, I would not buy... 54 00:04:23.940 --> 00:04:32.940 By the way, I own some gold, I own some silver, unless you think I'm just talking, that's gold. 55 00:04:32.940 --> 00:04:34.940 You want to examine it to confirm? 56 00:04:34.940 --> 00:04:38.940 I have some silver in my pocket, you never know when you need a little gold or a little silver. 57 00:04:38.940 --> 00:04:44.700 Special, especially when you go back to your fiftieth high school reunion. 58 00:04:44.700 --> 00:04:48.420 So I own them both and I've owned them a long time and I buy them periodically. 59 00:04:48.420 --> 00:04:54.180 I wouldn't buy gold or silver today, they've been going straight up like rockets. 60 00:04:54.180 --> 00:04:58.620 But if and when they have a correction I would buy more. 61 00:04:58.620 --> 00:05:03.040 I told him I'm not selling my silver by any stretch of the imagination, I think you'll 62 00:05:03.040 --> 00:05:09.280 will make more money in the foreseeable future in things like rice which are very depressed 63 00:05:09.280 --> 00:05:16.000 or even, I mean, even things like sugar, you know, they're serving coffee later, get yourself 64 00:05:16.000 --> 00:05:22.080 some sugar and take it home. It's free. Thank you, Lew. I'm taking this home to my daughters. 65 00:05:22.080 --> 00:05:29.560 It's part of their next fortune. Any raw material, you will probably do much better in the next 66 00:05:29.560 --> 00:05:34.760 10 or 15 years than you will in most assets, certainly in paper money. 67 00:05:34.760 --> 00:05:40.360 You famously said that the Maseratis of the stockbrokers were going to be moving into 68 00:05:40.360 --> 00:05:42.520 the hands of the farmers. 69 00:05:42.520 --> 00:05:45.720 So would you also buy farmland? 70 00:05:45.720 --> 00:05:50.160 Well I think that farmland is probably one of the best investments a person can make 71 00:05:50.160 --> 00:05:56.160 in the next, well in 2010 or in the foreseeable future. 72 00:05:56.160 --> 00:06:01.560 I don't know why you picked all of them, but this is a great place to be because this university 73 00:06:01.560 --> 00:06:02.560 is going to... 74 00:06:02.560 --> 00:06:05.680 All A&M universities are going to do well. 75 00:06:05.680 --> 00:06:10.220 When I speak at universities, I tell these kids, I say, you're nuts to get an MBA. 76 00:06:10.220 --> 00:06:14.780 You should be getting an A&M degree because the world is shifting away from financial 77 00:06:14.780 --> 00:06:20.640 types to people who produce real goods, whether it's farmers or miners or whatever. 78 00:06:20.640 --> 00:06:26.560 So yes, I think that if you know how to buy good farmland, you should buy good farmland. 79 00:06:26.560 --> 00:06:30.960 It's a much better investment than most other things. 80 00:06:30.960 --> 00:06:33.200 Should we all move to Singapore? 81 00:06:33.200 --> 00:06:37.200 Well, Paige and I did that because we got these little girls. 82 00:06:37.200 --> 00:06:40.200 We wanted to be well-educated. 83 00:06:40.200 --> 00:06:45.800 As many of you know, American education is not terribly good these days. 84 00:06:45.800 --> 00:06:50.800 Of course, kids always come out on top in most international testing. 85 00:06:50.800 --> 00:06:55.800 In fact, there was an article, front page of the New York Times, the day we got here, 86 00:06:55.800 --> 00:07:01.800 a week or so ago, it was talking about how many American schools are starting to teach Singapore math. 87 00:07:01.800 --> 00:07:07.800 And I will tell you, my little girl is in the first grade and I help her with her math, and I'm already having trouble. 88 00:07:07.800 --> 00:07:11.800 God knows what's going to happen when she's in the fourth or fifth grade. 89 00:07:11.800 --> 00:07:16.120 I have to call some of you up and say, what do we do here? 90 00:07:16.120 --> 00:07:18.040 This is serious stuff. 91 00:07:18.040 --> 00:07:23.380 We move there because of the education and because of the, for many reasons, and we want 92 00:07:23.380 --> 00:07:26.880 them to grow up speaking Mandarin. 93 00:07:26.880 --> 00:07:32.680 Whether you move is a very intensely personal decision, which everybody has to make. 94 00:07:32.680 --> 00:07:34.280 We are American citizens. 95 00:07:34.280 --> 00:07:35.760 We do pay American taxes. 96 00:07:35.760 --> 00:07:37.440 We vote in America. 97 00:07:37.440 --> 00:07:48.940 So we haven't totally immigrated. Our forebears left us somewhere and came to America. It 98 00:07:48.940 --> 00:07:52.380 must have been terribly wrenching, but when they did it, they were obviously very brave 99 00:07:52.380 --> 00:07:58.640 and ambitious people. So I'm not suggesting that anybody leave or immigrate, but if you 100 00:07:58.640 --> 00:08:03.860 are looking for a different life, there are fabulous opportunities in Asia these days, 101 00:08:03.860 --> 00:08:08.360 As I said, Asia is where the assets are. 102 00:08:08.360 --> 00:08:15.960 Throughout history, you have never heard people say, look at all those debtors over there. 103 00:08:15.960 --> 00:08:20.840 Why don't we immigrate to where all those debtors are? 104 00:08:20.840 --> 00:08:23.840 Throughout history, people have said, look at all that money. 105 00:08:23.840 --> 00:08:25.480 Look at all those assets. 106 00:08:25.480 --> 00:08:27.320 And that's where they go. 107 00:08:27.320 --> 00:08:32.000 So I will let you all decide that's your question yourself. 108 00:08:32.000 --> 00:08:38.160 We have partially voted with our feet. We're rearing our children in Asia, but we're still 109 00:08:38.160 --> 00:08:40.160 Americans, et cetera. 110 00:08:40.160 --> 00:08:44.180 You know, Pat, if you can start passing the microphones, maybe we'll have some questions 111 00:08:44.180 --> 00:08:47.840 from the audience, if Jim would be good enough to take them. 112 00:08:47.840 --> 00:08:53.640 Hello, Jim. I want to thank you for coming and congratulate you on your prize. You well 113 00:08:53.640 --> 00:08:56.080 deserve it. 114 00:08:56.080 --> 00:09:00.240 You know, I'm 18 and my dad has a trust fund that's set up for me that is managed by Goldman 115 00:09:00.240 --> 00:09:06.200 and I don't plan on receiving a dime of it, that's how I'm planning my life. At the same 116 00:09:06.200 --> 00:09:12.080 time I don't want all this money that he's saved up for me to be at least significantly 117 00:09:12.080 --> 00:09:16.800 diminished in the near future like it was when it was in the real estate market. Goldman 118 00:09:16.800 --> 00:09:20.560 Sachs has decided they're going to put 50% of it in government bonds for the next two 119 00:09:20.560 --> 00:09:24.720 and a half years and I've been trying to tell him he's crazy that if he would have listened 120 00:09:24.720 --> 00:09:30.000 to me three months ago I would have an extra $150 for each gold ounce I told him to buy. 121 00:09:30.000 --> 00:09:33.440 My question to you is, how do you think I should approach this in terms of trying to 122 00:09:33.440 --> 00:09:40.440 convince him that this is crazy? 123 00:09:40.440 --> 00:09:45.000 Can you break the trust when you're 21? 124 00:09:45.000 --> 00:09:46.000 There's a few terms. 125 00:09:46.000 --> 00:09:49.160 I have to be 21 and I have to have a college degree, so we're looking three to four years 126 00:09:49.160 --> 00:09:51.680 out before I can do that. 127 00:09:51.680 --> 00:09:54.520 Well if you have to have a college degree, then yes, you are looking at three or four 128 00:09:54.520 --> 00:09:55.520 years. 129 00:09:55.520 --> 00:10:21.520 If I were you I would take an accelerated course and try to get out of there. I mean it's hard, it's hard, most people on Wall Street, Gary knows this, many of you know this, you know, conventional wisdom is all they know. 130 00:10:21.520 --> 00:10:29.520 And nobody ever gets fired for losing all of your money with conventional wisdom. 131 00:10:29.520 --> 00:10:34.520 They get fired if they do something unusual and lose money. 132 00:10:34.520 --> 00:10:40.520 And if they do something unusual and it's right, they don't get many promotions, they just move along. 133 00:10:40.520 --> 00:10:44.520 So the best thing that... I don't know how you're going to convince them. 134 00:10:44.520 --> 00:10:50.520 I could sit down with them, too, or, you know, Joe DiMaggio or Mother Teresa could sit down with them. 135 00:10:50.520 --> 00:10:53.840 They're not going to listen because they've got their own their own way 136 00:10:53.840 --> 00:11:00.320 I would just urge you to take some accelerated courses and get your degree and get out of there. Thank you 137 00:11:01.120 --> 00:11:03.120 Jim yes, speak speak 138 00:11:03.280 --> 00:11:05.720 Don Murray from the Thomasville, Alabama 139 00:11:06.240 --> 00:11:11.840 I don't want to start a land boom here in Alabama, but what would you think about buying 140 00:11:12.680 --> 00:11:14.120 timberland 141 00:11:14.120 --> 00:11:17.240 cropland and the fertile Crestland of Alabama in the black belt 142 00:11:17.240 --> 00:11:24.400 Well, Don, as I said before, buying agricultural land, in my view, is one of the best things 143 00:11:24.400 --> 00:11:29.480 a person can do, and that includes timberland, there's no question about that. 144 00:11:29.480 --> 00:11:34.240 Look, in the future, in the next 20 or 30 years, states like Alabama are going to be 145 00:11:34.240 --> 00:11:36.440 a whole lot better off. 146 00:11:36.440 --> 00:11:42.160 If you want to buy yourself a lake house, don't buy it in Massachusetts or New York, 147 00:11:42.160 --> 00:11:44.480 you know, don't buy it in the financials. 148 00:11:44.480 --> 00:11:50.720 Buy yourself a place in Iowa, I mean those guys are going to be extremely rich in the 149 00:11:50.720 --> 00:11:59.440 next 20 or 30 years, now I don't want to go to Iowa either, I assure you, but he's asking 150 00:11:59.440 --> 00:12:05.760 about buying land, I'm partial to Alabama, but those of you like Alabama, find yourself 151 00:12:05.760 --> 00:12:13.120 some good land and buy it, or if you are looking for something else, look at Asia or South 152 00:12:13.120 --> 00:12:19.800 South America, Africa, there are vast amounts of potentially very productive land in the 153 00:12:19.800 --> 00:12:23.400 world, whether it's for trees or cotton or anything else. 154 00:12:23.400 --> 00:12:25.840 So yes, Don, no, it's a good thing. 155 00:12:25.840 --> 00:12:29.480 Don probably has a lot of land he'll sell you. 156 00:12:29.480 --> 00:12:30.480 Kaitlin? 157 00:12:30.480 --> 00:12:35.240 Kaitlin Long from Connecticut. 158 00:12:35.240 --> 00:12:41.940 In your opinion, is the chance that we have an unwieldy dollar collapse, and what's your 159 00:12:41.940 --> 00:12:46.380 Your perspective on why China continues to buy overvalued dollars and how long they'll 160 00:12:46.380 --> 00:12:48.620 continue to be willing to do that. 161 00:12:48.620 --> 00:12:54.500 Thank you and I would sell my house in Connecticut too. 162 00:12:54.500 --> 00:12:59.240 Well there is a little question in my mind and we're certainly going to have a total 163 00:12:59.240 --> 00:13:04.660 collapse of U.S. dollar at one point or another because the U.S. is now the largest debtor 164 00:13:04.660 --> 00:13:05.660 nation. 165 00:13:05.660 --> 00:13:09.140 We're not the largest debtor nation in the world, we're the largest debtor nation in 166 00:13:09.140 --> 00:13:11.540 the history of the world. 167 00:13:11.540 --> 00:13:15.980 has ever gotten themselves in this kind of bind before, and they're making it worse, 168 00:13:15.980 --> 00:13:21.440 not better. I don't know when that potential collapse will come. I wish I were that smart. 169 00:13:21.440 --> 00:13:25.340 The problem is that every other paper money in the world, nearly every other paper money 170 00:13:25.340 --> 00:13:31.260 in the world, is also suspect and is also being printed. It may be that there's going 171 00:13:31.260 --> 00:13:36.220 to come a time when all of us have to put all of our money into silver or rice or something 172 00:13:36.220 --> 00:13:47.000 The Pound sterling, which used to be the world's reserve currency and medium of exchange, went 173 00:13:47.000 --> 00:13:55.340 down over 90% from top to bottom over a few decades and there were exchange controls and 174 00:13:55.340 --> 00:13:58.820 it was a horrible, horrible mess. 175 00:13:58.820 --> 00:14:04.620 I would tell you all those of you who are students of history that in 1918 the richest 176 00:14:04.620 --> 00:14:08.460 The world's most powerful country in the world was the United Kingdom. 177 00:14:08.460 --> 00:14:13.460 You look at a map and the whole world was red, and they owned everything in 1918. 178 00:14:13.460 --> 00:14:19.220 Within one generation, the UK was a total basket case, there were exchange controls. 179 00:14:19.220 --> 00:14:20.220 It was horrific. 180 00:14:20.220 --> 00:14:25.100 And then when three generations, the UK went bankrupt and had to be bailed out by the IML. 181 00:14:25.100 --> 00:14:27.740 I mean, these are simple things, you can look them up. 182 00:14:27.740 --> 00:14:32.340 But this is the country which was the richest, most powerful country in the world, and within 183 00:14:32.340 --> 00:14:36.540 And three generations were bankrupt being bailed out by the IMF. 184 00:14:36.540 --> 00:14:40.780 Again, I don't like saying it, but we're going the same way. 185 00:14:40.780 --> 00:14:43.540 And you've always had currency. 186 00:14:43.540 --> 00:14:49.340 When I was at Oxford, we were always talking about the currency problem of the pound sterling. 187 00:14:49.340 --> 00:14:55.260 And it came true that there was an eventual total collapse of the pound sterling, and 188 00:14:55.260 --> 00:14:58.660 they were bailed out by the IMF. 189 00:14:58.660 --> 00:15:02.340 Why does China keep buying? 190 00:15:02.340 --> 00:15:08.980 I will tell you, from my perspective, you go in to see these, like I went to the Bank 191 00:15:08.980 --> 00:15:09.980 of Japan. 192 00:15:09.980 --> 00:15:14.220 If you went to the Japanese, say, 10 years ago and say, why do you keep buying United 193 00:15:14.220 --> 00:15:15.620 States government bonds? 194 00:15:15.620 --> 00:15:18.440 They keep printing them as fast as they can. 195 00:15:18.440 --> 00:15:22.140 And the bureaucrats would say, well, it's policy. 196 00:15:22.140 --> 00:15:26.620 You all know how I feel about bureaucracy and bureaucrats, especially in the United 197 00:15:26.620 --> 00:15:33.180 of States, these guys said, well, it's policy to buy government bonds, and that's the only 198 00:15:33.180 --> 00:15:35.180 reason they had to do it. 199 00:15:35.180 --> 00:15:39.860 I think it's, I know what happened with the Chinese, you know, they started getting all 200 00:15:39.860 --> 00:15:44.460 this money 15 years ago or so, and they bought government bonds, because that's what Goldman 201 00:15:44.460 --> 00:15:48.300 Sachs told them to do, and everybody else told them to do, and they just kept doing it. 202 00:15:48.300 --> 00:15:50.540 The next thing you knew, they had two trillion. 203 00:15:50.540 --> 00:15:55.800 They have started changing, started worrying about their government bonds. 204 00:15:55.800 --> 00:16:00.120 It just happened so fast and there was so much that accumulated. 205 00:16:00.120 --> 00:16:03.880 They're worried about it, I'm worried about it, all of us are worried about it. 206 00:16:03.880 --> 00:16:10.840 I suggest to both the Japanese and the Chinese that if I were you, I would not be buying 207 00:16:10.840 --> 00:16:12.480 U.S. dollar bonds. 208 00:16:12.480 --> 00:16:14.640 The government is printing them as fast as they can. 209 00:16:14.640 --> 00:16:20.720 If I were you, I would be putting my money into things like oil or zinc or cotton or 210 00:16:20.720 --> 00:16:21.720 rice. 211 00:16:21.720 --> 00:16:26.720 First of all, I think you're going to make a lot of money if you invest in real assets. 212 00:16:26.720 --> 00:16:31.720 Second, even if I'm wrong and something happens, you'll have strategic reserves. 213 00:16:31.720 --> 00:16:35.720 I mean, if the Straits of Hormuz close or the Straits of Malacca close or something, 214 00:16:35.720 --> 00:16:41.720 for whatever reason, hurricanes, earthquakes, war, you'll have a strategic reserve. 215 00:16:41.720 --> 00:16:44.720 And if I'm right, you're going to make a lot of money. 216 00:16:44.720 --> 00:16:49.720 But I do know that both the Chinese and the Koreans and some of the others 217 00:16:49.720 --> 00:16:55.920 are starting to cut back on their purchases of U.S. dollar bonds and U.S. dollars, and 218 00:16:55.920 --> 00:17:03.800 I would urge you to think about putting some of your money into rice or something else, 219 00:17:03.800 --> 00:17:10.640 not Connecticut real estate, as much as I like Connecticut. 220 00:17:10.640 --> 00:17:16.480 We talked this afternoon, you were the gentleman that told me at Jim Blanchard's seminar at 221 00:17:46.480 --> 00:17:52.240 If you really want to make a lot of money, put your money in lead, not gold. 222 00:17:52.240 --> 00:17:59.240 And he reminded me today how wrong I was by buying gold instead of buying lead. 223 00:17:59.240 --> 00:18:00.760 But that's not my question. 224 00:18:00.760 --> 00:18:02.240 My question to you tonight... 225 00:18:02.240 --> 00:18:04.240 Well, I'm delighted you remember. 226 00:18:04.240 --> 00:18:07.520 Well, you told me you won today. 227 00:18:07.520 --> 00:18:10.560 Sometimes I get it right, you know. 228 00:18:10.560 --> 00:18:14.040 I like to be reminded. 229 00:18:14.040 --> 00:18:22.760 My question is, you go to many, many audiences. You talk to a lot, a lot of people in a lot, 230 00:18:22.760 --> 00:18:29.480 a lot of places. You're in a very special place tonight because you're not only home, 231 00:18:29.480 --> 00:18:35.320 but you're a libertarian, and you're with libertarians, and you're with people that 232 00:18:35.320 --> 00:18:40.520 probably appreciate you as much or more than anybody you'll speak to in the next ten years. 233 00:18:40.520 --> 00:18:53.560 What advice would you give this audience on what they should do, what they can do, and 234 00:18:53.560 --> 00:19:03.760 how they should do it to try to spread the word about the Austrian School of Economics, 235 00:19:03.760 --> 00:19:09.320 being a student of Austrian Economics, the Von Mises Institute? 236 00:19:09.320 --> 00:19:15.600 How do you spread the word because, you know, we got the truth, but nobody knows anything 237 00:19:15.600 --> 00:19:17.480 about it except us? 238 00:19:17.480 --> 00:19:24.240 Well, it's a very good question, and if I had the answer, everybody would be a libertarian, 239 00:19:24.240 --> 00:19:26.680 wouldn't they? 240 00:19:26.680 --> 00:19:31.680 My advice is for everybody to continue to do what they do best, if it happens to be 241 00:19:31.680 --> 00:19:36.440 making money or teaching school, do whatever you do best, and continue to improve your 242 00:20:06.440 --> 00:20:09.160 for the Advisors to the Prime Minister. 243 00:20:09.160 --> 00:20:11.440 I said, how did you get it so wrong? 244 00:20:11.440 --> 00:20:13.840 He walked across the room and wouldn't talk to me. 245 00:20:15.000 --> 00:20:16.200 Now they listen to me, 246 00:20:16.200 --> 00:20:18.440 because I'm a little more successful than I was, 247 00:20:18.440 --> 00:20:19.360 you know, in those days. 248 00:20:19.360 --> 00:20:21.800 So I've just suggested everybody continue 249 00:20:21.800 --> 00:20:23.680 to thine own self be true, 250 00:20:23.680 --> 00:20:26.600 and people will listen to us more and more 251 00:20:26.600 --> 00:20:30.640 as the crude ones of the world are discredited. 252 00:20:30.640 --> 00:20:32.520 I wish I had a better answer. 253 00:20:32.520 --> 00:20:34.880 I wouldn't buy lead today, by the way. 254 00:20:34.880 --> 00:20:49.040 If that's what you're getting at, today I don't think I would buy rice, but I still 255 00:20:49.040 --> 00:20:51.760 own lead and I own all the others as well. 256 00:20:51.760 --> 00:20:53.240 Who's got the mic? 257 00:20:53.240 --> 00:20:55.240 Saag, you have the mic. 258 00:20:55.240 --> 00:21:02.680 Hi, thanks for coming and thanks to Lew Rockwell and the Mises Institute for this event. 259 00:21:02.680 --> 00:21:09.120 My question is, if someone was going to learn Mandarin and move to Northeast China, what 260 00:21:09.120 --> 00:21:13.960 would be the most efficient way that they could go about doing that? 261 00:21:13.960 --> 00:21:18.240 Well, Northeast China is where I would go because that's where they speak the purest 262 00:21:18.240 --> 00:21:23.120 Mandarin. It's a little bit like, if you wanted to learn English, I don't think you'd start 263 00:21:23.120 --> 00:21:32.240 in Demopolis, Alabama, which is where I learned English. As you can see, I still don't have 264 00:21:32.240 --> 00:21:34.400 a good command of the English language. 265 00:21:34.400 --> 00:21:39.160 But no, I would go to North, the Dahlia and the cities, the fabulous cities up there, 266 00:21:39.160 --> 00:21:40.520 and I would just immerse myself. 267 00:21:40.520 --> 00:21:43.420 There are very few people who speak English up there. 268 00:21:43.420 --> 00:21:49.040 It is extremely cheap, extremely cheap to go to school or even live there. 269 00:21:49.040 --> 00:21:54.240 And if you could get a job up there, I mean, in Dahlia, for instance, they have one of 270 00:21:54.240 --> 00:21:56.600 the major commodities exchanges in China. 271 00:21:56.600 --> 00:22:01.280 Go to Dahlia and see if you can get a job in the commodities exchange, sweeping the 272 00:22:01.280 --> 00:22:07.080 the floor, if nothing else, anything you can do, just listen and go drink beer with them, 273 00:22:07.080 --> 00:22:11.120 do whatever you got to do in order to learn Mandarin. I'm not very good with that. I'll 274 00:22:11.120 --> 00:22:15.680 tell you, my little girls who speak perfect Mandarin, in fact they're so good at it, Singapore 275 00:22:15.680 --> 00:22:21.160 uses them on TV to encourage people to speak Mandarin, but I'll say, I'll speak to my little 276 00:22:21.160 --> 00:22:25.200 girls, I'll say blah blah, and they say, what'd you say? I said blah blah. They say, what 277 00:22:25.200 --> 00:22:29.760 language are you speaking? They say, I'm speaking Mandarin. They say, daddy, please don't speak 278 00:22:29.760 --> 00:22:59.680 To leave North America and seek opportunity elsewhere, which countries, in your opinion, 279 00:22:59.680 --> 00:23:03.680 and Have the Greatest Respect for Private Property. 280 00:23:03.680 --> 00:23:06.000 That's a brilliant question. 281 00:23:06.000 --> 00:23:11.880 I will tell you that Singapore is obviously one of those. 282 00:23:11.880 --> 00:23:17.440 If you look at all the studies that people do fairly frequently these days, the people 283 00:23:17.440 --> 00:23:23.400 that have the most economic freedom or the most respect for private property, Singapore, 284 00:23:23.400 --> 00:23:29.600 Hong Kong, these are countries, they are Asian countries, but where, you know, the Asians 285 00:23:29.600 --> 00:23:36.200 Capitalism and entrepreneurship are deeply ingrained in their brains and in their genes 286 00:23:36.200 --> 00:23:39.440 and they have been for centuries. 287 00:23:39.440 --> 00:23:44.120 Hong Kong and Singapore are the ones who always come out on top in something like that. 288 00:23:44.120 --> 00:23:46.400 I cannot really think of another one. 289 00:23:46.400 --> 00:23:52.200 Most of the European countries, as you know, are being very corrupted and corroded by history 290 00:23:52.200 --> 00:23:53.760 of what's been going on. 291 00:23:53.760 --> 00:23:56.880 I cannot think of one in South America. 292 00:23:56.880 --> 00:24:05.400 Switzerland does have a fairly high regard for private property, but, I mean, it's Asia. 293 00:24:05.400 --> 00:24:07.000 It's facts are facts. 294 00:24:07.000 --> 00:24:10.840 I don't particularly like saying them, because I grew up here like all the rest of you, and 295 00:24:10.840 --> 00:24:13.400 I pay taxes here like the rest of you. 296 00:24:13.400 --> 00:24:16.120 But it's Asia's where the world is changing. 297 00:24:16.120 --> 00:24:18.480 Yes, who's got the mic? 298 00:24:18.480 --> 00:24:25.480 USA and Europe are in very tenuous condition, and if they slip further, is China and Asia 299 00:24:25.480 --> 00:24:31.640 In general, what's their risk of overcapacity? In other words, how global can this get? 300 00:24:31.640 --> 00:24:37.880 Well, look, America's the largest economy in the world. The EU, as an entity, is even 301 00:24:37.880 --> 00:24:46.360 bigger than the US. The Chinese economy is one-tenth the size of the European and American 302 00:24:46.360 --> 00:24:55.400 economies combined. China's been doing wonderful things, but look, if it's 10% of our economies, 303 00:24:55.400 --> 00:24:58.980 They throw in Japan and it's, I don't know, six percent. 304 00:24:58.980 --> 00:24:59.980 It's nothing. 305 00:24:59.980 --> 00:25:03.280 India is a third of the science of the Chinese economy. 306 00:25:03.280 --> 00:25:09.980 So if India and China boom, so what if the West runs into problems? 307 00:25:09.980 --> 00:25:14.680 If America and the West and Europe continue to run into problems, it's going to affect 308 00:25:14.680 --> 00:25:15.680 everybody. 309 00:25:15.680 --> 00:25:23.240 Now, I had rather be with the creditors in a case like that than the debtors, but everybody 310 00:25:23.240 --> 00:25:24.760 will suffer. 311 00:25:24.760 --> 00:25:30.560 In the 1920s and the 30s, America was the rising star on the block. 312 00:25:30.560 --> 00:25:32.360 We were the big creditor. 313 00:25:32.360 --> 00:25:38.760 The Depression came, partly caused by us with the Smoot-Hawley Act, but who cares what caused 314 00:25:38.760 --> 00:25:39.760 it? 315 00:25:39.760 --> 00:25:40.760 We had it. 316 00:25:40.760 --> 00:25:44.900 And America had a horrible, horrible experience in the Depression. 317 00:25:44.900 --> 00:25:50.640 So everybody suffers if the rich people get into trouble. 318 00:25:50.640 --> 00:25:51.640 China will too. 319 00:25:51.640 --> 00:25:54.280 Don't think I'm so naive that I don't understand that. 320 00:25:54.280 --> 00:26:01.760 I would remind you that in the US in the 19th century, we had 15 depressions with a D. We 321 00:26:01.760 --> 00:26:10.460 had a horrible civil war. We had very few human rights. We had very little rule of law. 322 00:26:10.460 --> 00:26:15.960 We had massacres in the streets with some regularity. You could buy and sell congressmen. 323 00:26:15.960 --> 00:26:22.400 You can still buy and sell congressmen, but in those days they were cheap. You could buy 324 00:26:22.400 --> 00:26:26.680 By three or four in those days for the price of one now. 325 00:26:26.680 --> 00:26:32.000 But America, as recently as 1907, the US went bankrupt, the whole system went bankrupt. 326 00:26:32.000 --> 00:26:36.760 We came out of that and did a brilliant job in the 20th century. 327 00:26:36.760 --> 00:26:38.640 That's going to happen to China too. 328 00:26:38.640 --> 00:26:43.640 All of those things are going to happen to China or anybody that's rising, whether it's 329 00:26:43.640 --> 00:26:48.400 a family or an individual or a company or a country, there are always setbacks. 330 00:26:48.400 --> 00:26:49.640 China will have them too. 331 00:26:49.640 --> 00:26:59.640 I don't think I don't understand that, and everybody will have troubles in the world you prophesize. Who's got the mic? 332 00:26:59.640 --> 00:27:09.640 You mentioned your interest in education, and as a father of a young child, and I've been studying Montessori theories, also unschooling and homeschooling ideas. 333 00:27:09.640 --> 00:27:12.640 I'd be curious to get your thoughts on education. 334 00:27:12.640 --> 00:27:18.080 Well, education is extraordinarily important to me. 335 00:27:18.080 --> 00:27:24.440 I would still be in the backwoods of Alabama if it hadn't been for education. 336 00:27:24.440 --> 00:27:26.480 I got this scholarship to go to Yale. 337 00:27:26.480 --> 00:27:30.480 I still can't quite understand how I got it, but I got it and I went off to Yale and then 338 00:27:30.480 --> 00:27:32.400 to Oxford and that changed everything. 339 00:27:32.400 --> 00:27:38.080 I'm sure I would be a lawyer in Marengo County right now if it hadn't been for that or a 340 00:27:38.080 --> 00:27:40.480 doctor or something down there. 341 00:27:40.480 --> 00:27:41.480 So I'm very keen on it. 342 00:27:41.480 --> 00:27:46.040 We, Paige and I looked around the world, as you can see, we went around the world looking 343 00:27:46.040 --> 00:27:49.440 for a good school in the end. 344 00:27:49.440 --> 00:27:55.800 We decided on Asia, if you go to Asian schools, you will be astounded, before I told you I 345 00:27:55.800 --> 00:28:01.880 was having trouble with homework, when I was in the first grade, we didn't have homework. 346 00:28:01.880 --> 00:28:07.920 My little girl comes home with homework every day and serious tests, she's already learning 347 00:28:07.920 --> 00:28:09.580 to learn how to multiply and divide. 348 00:28:09.580 --> 00:28:11.440 She's in the first grade. 349 00:28:11.440 --> 00:28:13.020 I didn't learn to multiply and divide 350 00:28:13.020 --> 00:28:15.460 until I was in the fourth or fifth grade. 351 00:28:15.460 --> 00:28:18.780 It is staggering how demanding and rigorous they are 352 00:28:18.780 --> 00:28:21.920 in Asia now, which is why they went all the other kids 353 00:28:21.920 --> 00:28:23.540 come out on top. 354 00:28:23.540 --> 00:28:26.260 If your child can deal with a rigorous 355 00:28:26.260 --> 00:28:28.780 and demanding education, the Asian way 356 00:28:28.780 --> 00:28:30.900 is certainly a viable one. 357 00:28:32.260 --> 00:28:33.900 It's really up to your children. 358 00:28:33.900 --> 00:28:36.840 I know enough about children now to know that. 359 00:28:36.840 --> 00:28:42.000 Not every child is built to be in a pressure cooker or lots of demands. 360 00:28:42.000 --> 00:28:47.120 Our children today, we're putting them in the most demanding and rigorous schools we 361 00:28:47.120 --> 00:28:48.440 can find. 362 00:28:48.440 --> 00:28:51.200 You can ask me in 30 years whether I did it right or not. 363 00:28:51.200 --> 00:28:55.880 Remember, I've never been a parent before, so I don't quite know how to do it. 364 00:28:55.880 --> 00:28:58.080 And the problem is you read all the books. 365 00:28:58.080 --> 00:29:01.760 One book says this, the other book says exactly the opposite. 366 00:29:01.760 --> 00:29:08.560 So, I don't know, we're going for the rigorous oriental way, but as I say, you can ask me 367 00:29:08.560 --> 00:29:12.560 in 30 years. 368 00:29:12.560 --> 00:29:21.120 I do, no matter what you do, how you educate your children, in their lifetime, they must 369 00:29:21.120 --> 00:29:23.280 know a second language. 370 00:29:23.280 --> 00:29:27.880 They must know at least one second language, because if the U.S. is going the way that 371 00:29:27.880 --> 00:29:35.000 that the UK went. You know what happened to the UK. The kids who can speak and understand 372 00:29:35.000 --> 00:29:42.960 another language are going to have an edge on the people who do not. The fact that my 373 00:29:42.960 --> 00:29:48.580 children speak fluent Mandarin will not make them successful. But if they wind up working 374 00:29:48.580 --> 00:29:54.380 in Chinese restaurants, they're going to be the maitre d' instead of the dishwasher. 375 00:29:54.380 --> 00:29:59.500 So I would urge, no matter what you do with education, be sure they learn a second or 376 00:29:59.500 --> 00:30:05.380 third language in the 21st century. 377 00:30:05.380 --> 00:30:07.380 Who else has a mic? 378 00:30:07.380 --> 00:30:13.260 Jim, similar question to a couple of others that have been asked at a little deeper level. 379 00:30:13.260 --> 00:30:20.860 How difficult is it to move to Singapore to get a work permit, A, from the US, B, if you're 380 00:30:20.860 --> 00:30:26.620 to obtain a work permit, B, could you tell me your thoughts on the implications of giving 381 00:30:26.620 --> 00:30:34.620 up one's citizenship to move to Singapore or even Hong Kong for a work and life there, 382 00:30:34.620 --> 00:30:39.540 including how protected assets might be there over the next 40 years or so? 383 00:30:39.540 --> 00:30:45.300 Well, Singapore is a country of five million people. They are trying to encourage people 384 00:30:45.300 --> 00:30:52.300 to move to Singapore. There are many countries which are anti-immigrant, anti, but Singapore 385 00:30:52.300 --> 00:30:57.380 has a demographic problem, many countries have demographic problems. They are encouraging 386 00:30:57.380 --> 00:31:04.340 people with brains and skills and success to come to Singapore. It's not as easy as 387 00:31:04.340 --> 00:31:08.700 it was two or three years ago because a lot of people have started coming. But if you're 388 00:31:08.700 --> 00:31:15.020 looking for a, that's one of the few countries in the world which encourages immigrants, 389 00:31:15.020 --> 00:31:25.020 香港, not quite as much because Hong Kong's got all those massive, they're a billion, 300 million Chinese, so they can have pretty much whoever they want as far as an immigrant is concerned. 390 00:31:25.020 --> 00:31:31.020 Singapore does not discriminate against whites or blacks or yellows or Indians or anybody else. 391 00:31:31.020 --> 00:31:38.020 They're keen to have, they have a very multiracial and multi-religious society and they want to keep it that way. 392 00:31:38.020 --> 00:32:01.180 What was the rest of your question today? 393 00:32:01.180 --> 00:32:08.180 Oh, giving up your citizenship. Well, Paige and I are American citizens and our children, too. 394 00:32:08.180 --> 00:32:14.180 I'm not here to urge you all to leave America and give up your citizenship. 395 00:32:14.180 --> 00:32:23.180 But I will say to you, and this is anecdotal, because a lot of expats talk about it these days, 396 00:32:23.180 --> 00:32:28.180 there is now a seven-month waiting list at the London Embassy. 397 00:32:28.180 --> 00:32:30.180 You have to go to an embassy to give up your citizenship. 398 00:32:30.180 --> 00:32:36.180 There's a 7-month waiting list to get to the embassy to give up your citizenship in London. 399 00:32:36.180 --> 00:32:39.100 In Geneva, there's a 14-month waiting list. 400 00:32:39.100 --> 00:32:43.140 I mean, if you called up in Geneva and said, I want to give up my citizenship, and said, 401 00:32:43.140 --> 00:32:50.140 you have to go down and do it, they'd say, come in, what is that, February of 2012, before 402 00:32:50.140 --> 00:32:58.380 they could even see you, because so many people apparently are doing it, for many reasons. 403 00:32:58.380 --> 00:33:05.220 They changed the law recently in theory to make it more expensive to give up your citizenship. 404 00:33:05.220 --> 00:33:09.860 That's backfired on them a little bit, but more and more people are worried apparently 405 00:33:09.860 --> 00:33:11.460 about what's going on. 406 00:33:11.460 --> 00:33:13.020 It can be done. 407 00:33:13.020 --> 00:33:17.100 It's a simple process, just go fill out the form and you have to have another passport. 408 00:33:17.100 --> 00:33:24.020 They won't let you give up your American citizenship unless you have another citizenship. 409 00:33:24.020 --> 00:33:28.240 But if you do it, then you don't ever have to pay taxes again, anywhere. 410 00:33:28.240 --> 00:33:33.240 If you plan it right, and apparently there are a lot of people doing it, but you have 411 00:33:33.240 --> 00:33:37.600 to have another passport first. But you should really, if you're thinking about something 412 00:33:37.600 --> 00:33:43.760 like that, I mean, I'm not doing it, I'm not a lawyer, I'm not an accountant, I'm not anything, 413 00:33:43.760 --> 00:33:50.040 so ask somebody. But I do know that a lot of expats, because you know, Americans are 414 00:33:50.040 --> 00:33:56.160 the only people in the world that have to pay taxes wherever they live. If you live 415 00:33:56.160 --> 00:34:02.560 If you live in Zimbabwe, you have to pay American taxes, even if you never go to America, don't 416 00:34:02.560 --> 00:34:06.880 earn a penny in America or anything else. You have to pay American taxes. We're one 417 00:34:06.880 --> 00:34:12.720 of only three or four countries in the world that require that. If you are French and you 418 00:34:12.720 --> 00:34:20.840 live in Australia, you don't have to pay taxes anywhere if you get it right. That's true 419 00:34:20.840 --> 00:34:27.040 Nearly every nation, nearly every nationality in the world, it's only the U.S. and two 420 00:34:27.040 --> 00:34:32.040 or three others which require you to pay taxes wherever you live. 421 00:34:32.040 --> 00:34:36.040 But again, I'm not here to encourage you all to leave America. 422 00:34:36.040 --> 00:34:40.600 You can come see us in Singapore if you want to educate your kids in Singapore, but we 423 00:34:40.600 --> 00:34:44.200 are Americans and pay taxes and vote here. 424 00:34:44.200 --> 00:34:45.200 John? 425 00:34:45.200 --> 00:34:52.800 I recommend commodities. Some of the commodities I read about now are called rare earth commodities 426 00:34:52.800 --> 00:34:58.640 and that China possesses 97% of those and that they are beginning to put quotas on the 427 00:34:58.640 --> 00:35:04.880 export of that and that all of those are essential to the development of technology and so forth. 428 00:35:04.880 --> 00:35:11.200 How do you see that effect in the development in the West and do you see that as a threat? 429 00:35:11.200 --> 00:35:16.640 So for those of you who don't know, you should be sure to listen to what John said. 430 00:35:16.640 --> 00:35:22.640 There are these things called rare earths, which are basically trace metals, lithium 431 00:35:22.640 --> 00:35:23.640 is one for instance. 432 00:35:23.640 --> 00:35:33.240 There are 17 or 18 of them, but nearly every electronic device, mobile phones, TVs, weapons, 433 00:35:33.240 --> 00:35:36.680 cars require rare earths. 434 00:35:36.680 --> 00:35:43.080 China does have 97% of them, at least as far as anybody can determine, and China is booming, 435 00:35:43.080 --> 00:35:48.480 and so China is cutting back on the exports of rare earths, which I guess anybody would 436 00:35:48.480 --> 00:35:54.000 do if they were booming and they could see that there's limited supply. 437 00:35:54.000 --> 00:35:59.080 America used to have some, America has started trying to figure out, the Pentagon is starting 438 00:35:59.080 --> 00:36:04.720 to try to figure out how to reopen or find or develop rare earths, but unfortunately 439 00:36:04.720 --> 00:36:09.880 It takes 10 or 15 years to open a mine in America these days, as you all know. 440 00:36:09.880 --> 00:36:16.280 So if you can figure out a viable way to invest in rare earths, you will probably make a fortune. 441 00:36:16.280 --> 00:36:19.840 I would urge you to be careful because you and I are not the only people who know it 442 00:36:19.840 --> 00:36:23.640 and a lot of charlatans are getting into the rare earths business. 443 00:36:23.640 --> 00:36:26.000 So be very careful if you do it. 444 00:36:26.000 --> 00:36:32.320 But it is a glaring problem that America and Japan, everybody, Germany, everybody is facing 445 00:36:32.320 --> 00:36:39.000 in this problem because all of the known, most of the known developed sources of rare earths 446 00:36:39.000 --> 00:36:40.000 are in China. 447 00:36:40.000 --> 00:36:46.960 There are rare earths other places, it's just it takes a while and an expense to develop 448 00:36:46.960 --> 00:36:51.600 them, but obviously if China does cut back exports, the price is going to go through 449 00:36:51.600 --> 00:36:55.520 the roof and then it will be more economic to develop them and you will see them, but 450 00:36:55.520 --> 00:36:57.840 then it takes a long time. 451 00:36:57.840 --> 00:37:03.760 But if you find some, John, you let us all know, okay? 452 00:37:03.760 --> 00:37:09.600 Don't spread it around on TV, you call us first, okay? 453 00:37:09.600 --> 00:37:11.080 If you have the mic, speak. 454 00:37:11.080 --> 00:37:17.560 I wanted to ask, a lot of us young people, we've all had our unique ways of finding Austrian 455 00:37:17.560 --> 00:37:18.560 economics. 456 00:37:18.560 --> 00:37:22.840 I was interested in how you found your way to Austrian economics. 457 00:37:22.840 --> 00:37:23.840 Well, I didn't really. 458 00:37:23.840 --> 00:37:28.280 I went to Yale and I went to Oxford and I heard all this gibberish, which a little bit 459 00:37:28.280 --> 00:37:30.940 like one of the kids on the screen before. 460 00:37:30.940 --> 00:37:34.600 She said she couldn't believe what they were saying because it didn't make sense. 461 00:37:34.600 --> 00:37:36.720 That's what happened to me. 462 00:37:36.720 --> 00:37:44.040 I just figured out in my own mind what I thought should work and was the right thing to do. 463 00:37:44.040 --> 00:37:47.040 And then I found out it was called Austrian Economics. 464 00:37:47.040 --> 00:37:48.040 I didn't know. 465 00:37:48.040 --> 00:37:53.880 I never read, you know, I wasn't smart enough to come down here and learn from Lou. 466 00:37:53.880 --> 00:37:56.800 I just sort of, then there it was. 467 00:37:56.800 --> 00:38:05.760 You've got to remember, places like Yale and Oxford, they couldn't spell von Mises. 468 00:38:05.760 --> 00:38:06.760 They didn't care. 469 00:38:06.760 --> 00:38:09.000 It was, it was totally shunned. 470 00:38:09.000 --> 00:38:14.600 It's, you cannot imagine what it was like in the 60s when I was studying economics. 471 00:38:14.600 --> 00:38:16.200 They just totally shunned it. 472 00:38:16.200 --> 00:38:21.960 I don't even know if anybody remembered, you know, they did give a Nobel Prize and some 473 00:38:21.960 --> 00:38:27.640 of these guys were recognized in some circles, but now it's much better. 474 00:38:27.640 --> 00:38:32.360 There are places like, you know, what Lew is down here doing and there are other places. 475 00:38:32.360 --> 00:38:35.560 People know what Austrian economics is now. 476 00:38:35.560 --> 00:38:40.840 In the Ivy League, they shun it and still badmouth it, but when I was in the Ivy League, 477 00:38:40.840 --> 00:38:45.840 they never, they didn't know about it, they didn't pay any attention. 478 00:38:45.840 --> 00:38:51.480 So there is progress which is being made. And I guess the best way to learn about Austrian 479 00:38:51.480 --> 00:38:53.680 economics is to come down here and study with Lew. 480 00:38:53.680 --> 00:38:55.680 Oh, that's right. 481 00:38:55.680 --> 00:38:57.680 Who's got a mic? 482 00:38:57.680 --> 00:39:04.880 I love watching you on TV, everything you say. I find myself at home literally at static, 483 00:39:04.880 --> 00:39:10.320 almost screaming when I hear you talk to someone like Maria Bartiromo and let her know what's 484 00:39:10.320 --> 00:39:17.080 going on, but I have a question in regards to what it is currently that you might be 485 00:39:17.080 --> 00:39:26.240 reading if there's a book or any book that you would recommend to all of us that you 486 00:39:26.240 --> 00:39:27.240 like? 487 00:39:27.240 --> 00:39:33.540 Well, let me cut you off if I could. I came to fatherhood late. I told you before what 488 00:39:33.540 --> 00:39:39.720 I thought of being a parent, how I shunned it. We read a lot in my house, but we read 489 00:39:39.720 --> 00:39:44.720 Children's Books and How to Be a Parent. 490 00:39:44.720 --> 00:39:50.880 So I'm afraid you're not really interested in Strange George, I don't think, but we read 491 00:39:50.880 --> 00:39:52.880 a whole lot of stuff. 492 00:39:52.880 --> 00:39:58.040 I will tell you one thing, you asked about education before, I forget where you are, 493 00:39:58.040 --> 00:40:03.840 but I don't know how many of you remember the McGuffey's readers, none of you do because 494 00:40:03.840 --> 00:40:09.680 they were out of print, but in America in the late 19th century and early 20th century, 495 00:40:09.680 --> 00:40:14.680 All American kids learn to read with something called MacGuffey's Readers. 496 00:40:14.680 --> 00:40:20.840 And so I got a set of MacGuffey's Readers and started teaching my little girl to read 497 00:40:20.840 --> 00:40:22.520 with a MacGuffey's Reader. 498 00:40:22.520 --> 00:40:27.880 And I will tell you, it is remarkable how good they are, if you ask me. 499 00:40:27.880 --> 00:40:33.040 It also gives you a whole, since they were written in the late 19th century, gives you 500 00:40:33.040 --> 00:40:38.120 a whole different view of the world because there are no cars, no telephones, no TVs and 501 00:40:38.120 --> 00:40:39.120 anything. 502 00:40:39.120 --> 00:40:45.120 It's a really, really very rigorous and interesting way to teach children to read, and that's 503 00:40:45.120 --> 00:40:47.880 how my first little girl learned to read. 504 00:40:47.880 --> 00:40:53.280 She's now reading at the level of third grade, and she's in the first grade, and we're going 505 00:40:53.280 --> 00:40:55.000 to teach the other little girl the same way. 506 00:40:55.000 --> 00:40:57.520 We now have two sets of McGuffey's readers. 507 00:40:57.520 --> 00:41:02.560 They were first published in 1879, and the generations which made America rich and great 508 00:41:02.560 --> 00:41:05.760 all grew up reading McGuffey's readers. 509 00:41:05.760 --> 00:41:08.520 Now, I don't know if it's going to work or not, as I said. 510 00:41:08.520 --> 00:41:12.520 You can ask me in 30 years, but that's how I'm teaching my children. 511 00:41:12.520 --> 00:41:15.780 And these are remarkable stories. 512 00:41:15.780 --> 00:41:21.220 They don't teach self-esteem, they teach you discipline and honor and integrity, for the 513 00:41:21.220 --> 00:41:24.520 most part, and hard work. 514 00:41:24.520 --> 00:41:30.020 In your comments about Brazil, relative to the other larger emerging economies, and particularly 515 00:41:30.020 --> 00:41:32.920 in light of your comments about farmland. 516 00:41:32.920 --> 00:41:39.400 Well, I'm an advisor to a company which is actually buying farmland in Brazil, buying 517 00:41:39.400 --> 00:41:45.840 land in Brazil and rehabilitating it or fixing it up, turning it into farmland. I'm optimistic 518 00:41:45.840 --> 00:41:54.840 about Brazil. The only, as you all know, maybe you don't, but the Brazilians say, the Brazilians 519 00:41:54.840 --> 00:42:02.000 say Brazil is the next great country in the world. Always has been and always will be. 520 00:42:02.000 --> 00:42:08.240 That's what they say. They also say, it's one of the Brazilians saying, you know, Brazil 521 00:42:08.240 --> 00:42:15.680 is God's given country. This is God's country. The only problem is he then sent Brazilians 522 00:42:15.680 --> 00:42:23.040 and messed it up. That's what the Brazilians said. Brazil has got vast natural resources, 523 00:42:23.040 --> 00:42:30.040 a huge population, a huge frontier area. And throughout history, when commodities have 524 00:42:30.040 --> 00:42:36.180 have done well. Brazil has done well. The only, well, historically, Brazil has done 525 00:42:36.180 --> 00:42:42.400 extremely well when there's a, when their commodity bull market, and then when the commodity 526 00:42:42.400 --> 00:42:48.160 bull market has ended, they lapse back into military coups and inflation and all the rest 527 00:42:48.160 --> 00:42:53.440 of it. They say it's different this time, that they're going to come out of, when this 528 00:42:53.440 --> 00:42:59.640 commodity bull market ends, Brazil has learned its lessons and will continue to do good things. 529 00:42:59.640 --> 00:43:06.640 I would remind you all that perhaps the most dangerous words in the investment language are, 530 00:43:06.640 --> 00:43:10.640 it's different this time, because it ain't ever different. 531 00:43:10.640 --> 00:43:13.640 The world doesn't change that much. 532 00:43:13.640 --> 00:43:16.640 But I'm optimistic about Brazil. I see great possibilities. 533 00:43:16.640 --> 00:43:20.640 It's a wonderfully fun place, lots of stuff to see and do. 534 00:43:20.640 --> 00:43:26.640 It's a terrific place and it's got the wind at its back, at least for the next decade or two. 535 00:43:29.640 --> 00:43:33.920 It's not working, is it? Is it working? Okay. You've got to put it to your mouth. 536 00:43:33.920 --> 00:43:39.240 Why did you avoid Brazil on your trip? Because I look at your route and you totally avoided 537 00:43:39.240 --> 00:43:44.680 going through Brazil. Well, we went into Brazil down here and here 538 00:43:44.680 --> 00:43:49.960 and we went to Iguazu Falls. The problem, not the problem, we either had to go this 539 00:43:49.960 --> 00:43:58.840 way or this way and this way is more interesting to see and there are roads. A lot of this 540 00:43:58.840 --> 00:44:07.560 The US doesn't have roads, but we did go into Brazil, as you can see, to some extent, twice, 541 00:44:07.560 --> 00:44:13.940 but then we wanted to go up the west coast because more sites, more roads, et cetera. 542 00:44:13.940 --> 00:44:19.640 Eastern Brazil was never, eastern South America, coastal anyway, was never developed very well. 543 00:44:19.640 --> 00:44:25.940 It's becoming, but if you're going to do it, you should do the west coast first. 544 00:44:25.940 --> 00:44:30.020 Maybe the next time Paige and I go, you can come with us and we'll go up the East Coast 545 00:44:30.020 --> 00:44:31.020 of Brazil. 546 00:44:31.020 --> 00:44:37.700 No, it's a wonderful, yeah, I couldn't disagree at all. 547 00:44:37.700 --> 00:44:41.780 I keep saying to my little girls, we're teaching them Spanish and Mandarin that they should 548 00:44:41.780 --> 00:44:49.860 learn Portuguese instead, but you can't tell seven-year-olds much these days. 549 00:44:49.860 --> 00:44:50.860 Who's got a mic? 550 00:44:50.860 --> 00:44:51.860 I'm Scott. 551 00:44:51.860 --> 00:44:52.860 I'm from Lisbon, Portugal. 552 00:44:52.860 --> 00:44:53.860 Ah, he speaks Portuguese. 553 00:44:53.860 --> 00:44:55.860 Ah, he speaks Portuguese! 554 00:44:57.860 --> 00:45:01.860 But in 2004 I heard you a discussion with Mark Faber, and I forget the other guy's name, 555 00:45:01.860 --> 00:45:06.860 and you were very critical of the European Union, with both of them, 556 00:45:06.860 --> 00:45:11.860 and I'm wondering what do you think of it now, especially for the southern European countries like Portugal, Spain and Italy, 557 00:45:11.860 --> 00:45:19.860 and what is their outlook for the next three, four years? Is it... well, let me know. 558 00:45:19.860 --> 00:45:20.860 Let me know. 559 00:45:20.860 --> 00:45:25.020 Well, as you know, the European Union, many of those countries are essentially bankrupt 560 00:45:25.020 --> 00:45:27.780 now. 561 00:45:27.780 --> 00:45:37.020 At the time, Mark and I, I forget his name too, the other guy. 562 00:45:37.020 --> 00:45:42.540 My view of the European Union is a wonderful thing, especially if they really do make it 563 00:45:42.540 --> 00:45:51.500 a free market, I mean an inner market, a free trade zone, if they continue to do that, a 564 00:45:51.500 --> 00:45:55.540 free movement of capital and people and goods, that would be good for the world. 565 00:45:55.540 --> 00:45:59.660 Now the problem of course is then you have a trade barrier around Europe, which is not 566 00:45:59.660 --> 00:46:06.340 good, but any free trade zone the world can get is better than none. 567 00:46:06.340 --> 00:46:36.340 Unfortunately, I'm afraid that the euro, which is the currency, will not survive in 15 or 20, 10 or 15. I own the euro right now, but I'm afraid it's become a political currency rather than an economic currency, and I'm afraid it will disintegrate sometime in the next 15 years, because politicians will blame their problems on the euro. It's already happening in some countries. The Greeks, for instance, some Portuguese are blaming 568 00:46:36.340 --> 00:46:44.340 The World Needs Something to Compete with the U.S. Dollar 569 00:46:44.340 --> 00:46:47.340 The World Desperately Needs Something to Compete with the U.S. Dollar 570 00:46:47.340 --> 00:46:50.340 It's a terribly flawed currency, as I've said before. 571 00:46:50.340 --> 00:46:55.340 The Euro on paper would be perfect, huge population, huge economy, 572 00:46:55.340 --> 00:46:58.340 not a big debtor entity like the U.S. is. 573 00:46:58.340 --> 00:47:02.340 They're internal debts, but not, I mean, internal debtor nations. 574 00:47:02.340 --> 00:47:07.300 I'm afraid it won't survive, and if the Euro does disintegrate in 10 or 15 years, 575 00:47:07.300 --> 00:47:12.580 it will probably be at the same time that the U.S. is having horrendous currency problems, 576 00:47:12.580 --> 00:47:19.380 or it may be caused by the U.S.'s problems. May I suggest you learn about silver? May I 577 00:47:19.380 --> 00:47:25.460 urge you to learn about rice and real goods, because the world's getting itself into a very 578 00:47:25.460 --> 00:47:46.460 I was in a very precarious situation and I don't remember a time in the world where there was no currency that we could all look to, even if it was gold, once upon a time there was a Spanish currency, once upon a time there was a Dutch currency, once upon a time there was a UK currency. 579 00:47:46.460 --> 00:47:52.220 Now if you look around for a currency, I anyway cannot find a currency that I would want to 580 00:47:52.220 --> 00:47:57.740 own except the renminbi, the Chinese renminbi, but you can't just buy and sell the renminbi. 581 00:47:57.740 --> 00:48:00.140 It's not legally. 582 00:48:00.140 --> 00:48:06.140 You can buy it legally, but you can't just pick up the phone and say, buy me some euros 583 00:48:06.140 --> 00:48:09.540 or buy me some renminbi because you cannot do it. 584 00:48:09.540 --> 00:48:13.660 So the world's in a serious, serious situation. 585 00:48:13.660 --> 00:48:18.020 What's the most user-friendly way that you can recommend for an ordinary person to invest 586 00:48:18.020 --> 00:48:19.940 in commodities right now? 587 00:48:19.940 --> 00:48:25.860 And if that's through indexes or ETFs, are there dangers of not owning physical goods 588 00:48:25.860 --> 00:48:29.460 somewhat like the problem with gold ETFs right now? 589 00:48:29.460 --> 00:48:32.580 Well, I'm a simple person too. 590 00:48:32.580 --> 00:48:39.500 I grew up in Demopolis, Alabama, and I grew up in a very small town, and I've tried to 591 00:48:39.500 --> 00:48:41.380 learn a little bit about how the world works. 592 00:48:41.380 --> 00:48:44.580 You can learn about the world as well. 593 00:48:44.580 --> 00:48:50.100 Physical commodities are very good in many ways, but you do have to worry about storing 594 00:48:50.100 --> 00:48:52.940 them, transporting, et cetera. 595 00:48:52.940 --> 00:48:58.500 Futures, if you really know commodities, futures are probably the best way because you can 596 00:48:58.500 --> 00:49:06.500 get enormous leverage and you don't have to worry too much about default because the exchanges 597 00:49:06.500 --> 00:49:27.740 ETS are another way you could do it. 598 00:49:27.740 --> 00:49:33.420 For most people, you should invest in an index rather than specific commodities unless you 599 00:49:33.420 --> 00:49:35.040 know what you're doing. 600 00:49:35.040 --> 00:49:41.040 Many studies have demonstrated repeatedly that investing in indexes is better than active 601 00:49:41.040 --> 00:49:45.280 management 70 or 80 percent of the time, year after year after year. 602 00:49:45.280 --> 00:49:50.200 It's a bad comment on the investing community, but it happens to be true. 603 00:49:50.200 --> 00:49:53.060 So you can pick out indexes. 604 00:49:53.060 --> 00:49:56.240 Another way is to invest in commodity companies. 605 00:49:56.240 --> 00:50:02.220 I mean, if you know a company which is going to discover natural gas in Berlin, I would 606 00:50:02.220 --> 00:50:06.220 I would urge you to buy all you can, and then you call me, okay? 607 00:50:06.220 --> 00:50:12.220 But the problem is there are 500, who knows how many, hundreds of natural gas companies in the world. 608 00:50:12.220 --> 00:50:16.220 I would remind you that Enron was a natural gas company. 609 00:50:16.220 --> 00:50:22.220 Well, the price of natural gas had tripled, but Enron went to zero, because for a variety of reasons. 610 00:50:22.220 --> 00:50:26.220 So if you invest in the stocks, you have to be very good at them. 611 00:50:26.220 --> 00:50:33.320 Studies have shown you would be 300% better off investing in commodities themselves rather 612 00:50:33.320 --> 00:50:35.460 than commodity stocks. 613 00:50:35.460 --> 00:50:37.420 You could also invest in countries. 614 00:50:37.420 --> 00:50:41.100 Canada is a natural resource-based economy. 615 00:50:41.100 --> 00:50:46.460 It will do better than the US, whether you're in the retail business, the restaurant business, 616 00:50:46.460 --> 00:50:50.140 the currency or anything else, you'll do better there than in the US. 617 00:50:50.140 --> 00:50:53.220 You'll do better in Australia than in, say, Belgium. 618 00:50:53.220 --> 00:50:54.980 That's another way to do it. 619 00:50:54.980 --> 00:51:17.860 Congratulations on the award. 620 00:51:17.860 --> 00:51:23.460 I have a question based on what I've read in the last few weeks, that the Chinese government 621 00:51:23.460 --> 00:51:30.260 is encouraging the Chinese people to buy silver and buy gold because ultimately their strategy 622 00:51:30.260 --> 00:51:35.660 is to back the renminbi or the yuan with gold and silver. 623 00:51:35.660 --> 00:51:40.580 Now is this a long-term strategy viewing that the dollar and the euro will crash and that 624 00:51:40.580 --> 00:51:46.140 this will turn out to be the next reserve currency in the latter part of the 21st century? 625 00:51:46.140 --> 00:51:51.420 Well the only currency I can see on the horizon which could replace the dollar, given my view 626 00:51:51.420 --> 00:52:21.340 The most important part of what you said, not the most important, but another, yes, the Chinese are. 627 00:52:21.340 --> 00:52:26.900 The Chinese government now is encouraging the Chinese to buy gold and silver for the first 628 00:52:26.900 --> 00:52:28.980 time in several decades. 629 00:52:28.980 --> 00:52:34.280 There are active campaigns from the government, supported by the government, to encourage 630 00:52:34.280 --> 00:52:38.180 Chinese citizens to buy gold and silver. 631 00:52:38.180 --> 00:52:40.320 It's going to be a fabulous growth market. 632 00:52:40.320 --> 00:52:45.940 If you know a way to sell gold or silver to the Chinese, you're going to be extremely 633 00:52:45.940 --> 00:52:46.940 successful. 634 00:52:46.940 --> 00:52:55.540 They'll change the name to whatever you want it, if you'll make so much money, and it's 635 00:52:55.540 --> 00:52:56.540 happening. 636 00:52:56.540 --> 00:53:00.660 It's another reason that gold and silver are going up. 637 00:53:00.660 --> 00:53:06.540 The Chinese produce a lot of gold, but now they want their citizens to buy it, for whatever 638 00:53:06.540 --> 00:53:07.540 reason. 639 00:53:07.540 --> 00:53:10.020 You say it's because they're going to back the renminbi with gold. 640 00:53:10.020 --> 00:53:11.020 Maybe. 641 00:53:11.020 --> 00:53:12.020 That's it. 642 00:53:12.020 --> 00:53:31.060 How are you? I was thinking that Mr. Bernanke is not a great Federal Reserve Chairman, but 643 00:53:31.060 --> 00:53:37.460 he's probably an even worse helicopter pilot. So that being the case, what are the specific 644 00:53:37.460 --> 00:53:43.540 mechanisms by which the new money that's going to be created is going to get it actually 645 00:53:43.540 --> 00:53:44.540 into the economy. 646 00:53:44.540 --> 00:53:48.860 Well, Mr. Bernanke is going to do the only thing he knows to do, and that's to buy government 647 00:53:48.860 --> 00:53:49.860 bonds. 648 00:53:49.860 --> 00:53:54.500 He's going to monetize the government debt, and you and I and the rest of us are going 649 00:53:54.500 --> 00:53:56.900 to pay the price. 650 00:53:56.900 --> 00:54:03.120 By the way, speaking of Mr. Bernanke, some of you know that I would have abolished the 651 00:54:03.120 --> 00:54:07.140 Federal Reserve if I had anything to do with it. 652 00:54:07.140 --> 00:54:16.060 This is something I've written about. I wrote about it in my first book, which was published 653 00:54:16.060 --> 00:54:23.340 in 1994. But I don't think we have to worry too much, because as you know, the first two 654 00:54:23.340 --> 00:54:29.100 central banks in America disappeared. And this was going to disappear too, because given 655 00:54:29.100 --> 00:54:35.580 Alan Greenspan and Mr. Bernanke, they're destroying it from within. Now, it's not good for any 656 00:54:35.580 --> 00:54:41.740 Many of us, it's not good for the world that the U.S. Central Bank is going to fail. 657 00:54:41.740 --> 00:54:47.540 Three years ago, the U.S. Central Bank had assets of about $800 billion and they were 658 00:54:47.540 --> 00:54:49.540 all in government bonds. 659 00:54:49.540 --> 00:54:54.260 Now it's got well over $2 trillion and it's all in garbage. 660 00:54:54.260 --> 00:54:57.700 We don't know what the garbage is because they won't have an audit. 661 00:54:57.700 --> 00:55:03.100 They won't tell us what it is, as you know, but no, it's going to self-destruct. 662 00:55:03.100 --> 00:55:09.000 I would also point out to you, I talked before that we're in a period of great change. 663 00:55:09.000 --> 00:55:14.540 One of the great changes that will happen is, for the past 30 or 40 years, central banks 664 00:55:14.540 --> 00:55:19.560 and central bankers have been considered sort of gods, like they knew, but remember, these 665 00:55:19.560 --> 00:55:23.860 guys were just bureaucrats who couldn't get a real job, and that's why they were working 666 00:55:23.860 --> 00:55:25.900 for the government. 667 00:55:25.900 --> 00:55:30.340 But somehow, in the press, they've become these all knowledgeable people. 668 00:55:30.340 --> 00:55:36.300 Ben Bernanke was some wimpy Ivy League professor eight years ago and now all of a sudden people 669 00:55:36.300 --> 00:55:37.520 think he knows everything. 670 00:55:37.520 --> 00:55:42.860 Just like Alan Greenspan, Alan Greenspan failed on Wall Street repeatedly and he kept getting 671 00:55:42.860 --> 00:55:48.020 government jobs because he failed and then the press came to think he was a very smart 672 00:55:48.020 --> 00:55:49.500 guy. 673 00:55:49.500 --> 00:55:51.500 They are self-destructing from within. 674 00:55:51.500 --> 00:55:56.560 Again, that's not good for any of us, but it's going to happen, but that's also going 675 00:55:56.560 --> 00:56:03.400 to lead to, once again, 40 years ago, if I'd said to any of you, who's the head of the 676 00:56:03.400 --> 00:56:05.240 central bank? 677 00:56:05.240 --> 00:56:06.360 You know what you would have said? 678 00:56:06.360 --> 00:56:09.600 What's the central bank, much less who's the head of it? 679 00:56:09.600 --> 00:56:14.920 Now we all know Mr. Greenspan, Mr. Bernanke, but that's a recent phenomenon. 680 00:56:14.920 --> 00:56:17.880 That's not the way the world has ever worked. 681 00:56:17.880 --> 00:56:21.720 Nobody in the UK could have named the central bank head 50 years ago. 682 00:56:21.720 --> 00:56:24.800 Now everybody knows his name, likewise in Europe. 683 00:56:24.800 --> 00:56:30.460 But that era will change too, we will go away from being, as we all know, the heads of central 684 00:56:30.460 --> 00:56:35.120 banks and central banks will go into disrepute because they're ruining so many currencies 685 00:56:35.120 --> 00:56:36.120 and so many economies. 686 00:56:36.120 --> 00:56:43.000 I do have to say one more thing before I stop because I've been talking about gold. 687 00:56:43.000 --> 00:56:49.040 One of the other things I wrote in one of my books is that we really should have an 688 00:56:49.040 --> 00:56:59.720 And that's an audit of the, of Fort Knox. Now, I wrote this in, I think it was Adventure 689 00:56:59.720 --> 00:57:02.720 Cat. You see, you all should go out there and buy my books and you can tell me, you 690 00:57:02.720 --> 00:57:07.700 can tell me which book I wrote it in. I think it was six or seven years ago. But there has 691 00:57:07.700 --> 00:57:16.120 not been an audit of Fort Knox, a real audit, since at least the early 1950s. You might 692 00:57:16.120 --> 00:57:22.600 I think that's strange since everything is audited. The Mises Institute, Auburn University, 693 00:57:22.600 --> 00:57:28.480 the Catholic Church, the hospital, everything is audited except Fort Knox and the Federal 694 00:57:28.480 --> 00:57:35.880 Reserve. But even that audit, if you go back and look at it, the U.S. government has been 695 00:57:35.880 --> 00:57:41.740 stating for decades that we have whatever it is, several hundred tons of gold in Fort 696 00:57:41.740 --> 00:57:42.740 Ford Knox. 697 00:57:42.740 --> 00:57:47.980 Now, nobody knows them, but even if you go back and look at the audit, I think it was 698 00:57:47.980 --> 00:57:51.500 1953, you'll see they didn't really do a very good audit. 699 00:57:51.500 --> 00:57:54.920 They went in there and they didn't sample the stuff. 700 00:57:54.920 --> 00:57:59.300 And remember, most of the gold that's in Ford, a lot of the gold that's in Ford Knox is when 701 00:57:59.300 --> 00:58:05.640 Roosevelt confiscated everybody's gold in the 1930s. 702 00:58:05.640 --> 00:58:11.360 But much of the gold which was confiscated in the 1930s was not 99% gold. 703 00:58:11.360 --> 00:58:18.520 was a lot of was garbage gold and so even if those tons are in Fort Knox I'm 704 00:58:18.520 --> 00:58:23.400 afraid that we're going to find it's not the purity that you have to have if 705 00:58:23.400 --> 00:58:28.240 you're going to have golden in the in the free market so I'm afraid that may be 706 00:58:28.240 --> 00:58:33.720 one reasons they do not want to audit the gold because it may not be there but 707 00:58:33.720 --> 00:58:37.940 let's suppose it is there I'm afraid we're going to find out it's not very 708 00:58:37.940 --> 00:58:43.420 Good Gold, and it would not be a big reserve for us on the open market. I don't think the 709 00:58:43.420 --> 00:58:46.980 Chinese would take it, for instance. I don't think anybody would take it. I don't think 710 00:58:46.980 --> 00:58:53.300 the exchange, the commodities exchange would take it. So we have more hidden problems in 711 00:58:53.300 --> 00:58:58.580 the U.S. than they let on. Maybe that's why they don't let them on. Is that the end of 712 00:58:58.580 --> 00:58:59.580 the story? Okay. 713 00:59:00.580 --> 00:59:03.580 Thank you. Thank you. 714 00:59:07.940 --> 00:59:09.940 Thank you very much.