WEBVTT NOTE Inflation and the Bolsheviks 1 00:00:00.000 --> 00:00:04.900 Well, thank you very much. It's so nice to be here. It's such a breath of fresh air, 2 00:00:04.900 --> 00:00:16.300 because I came from the cold socialism of Wisconsin with them, with the people I call sheeple. 3 00:00:16.300 --> 00:00:26.300 And we'll talk today about inflation in Bolsheviks, yes. Inflation in Bolsheviks, it's a topic, I would say. 4 00:00:26.300 --> 00:00:33.300 It's a fantastic topic these days, especially after hearing Ron Paul talking about Bolsheviks in Washington, D.C., 5 00:00:33.300 --> 00:00:39.300 which probably right now outshine Moscow Bolsheviks. 6 00:00:39.300 --> 00:00:49.300 And during these two days already of our conference, it was just so delightful to hear speakers here. 7 00:00:49.300 --> 00:00:50.300 It just was wonderful. 8 00:00:50.300 --> 00:00:57.300 Yesterday I was listening to Peter Klein and he said he met Greenspan in a pizza parlor. 9 00:00:57.300 --> 00:01:00.300 I was thinking he was already serving there. 10 00:01:00.300 --> 00:01:06.300 I think that would be a good kind of thing to do. 11 00:01:06.300 --> 00:01:10.300 Speaking about Greenspan, about Bolsheviks in Washington D.C. 12 00:01:10.300 --> 00:01:14.300 Last week I got a phone call at 3 o'clock in the morning from Moscow. 13 00:01:14.300 --> 00:01:19.300 I have a person I know there, he was a former general of Russian Army. 14 00:01:19.300 --> 00:01:24.300 Amazingly enough, he was the first and the last Jewish general of the Russian army. 15 00:01:24.300 --> 00:01:28.300 And he called me at 3 o'clock in the morning, and I think he was drunk. 16 00:01:28.300 --> 00:01:32.300 And he didn't realize that there was a time difference. 17 00:01:32.300 --> 00:01:40.300 And so he called me, he said, I'm watching TV, and there is a Jewish interrogator interrogating Greenspan. 18 00:01:40.300 --> 00:01:43.300 And I thought, who's that? Maybe Mr. Waxman. 19 00:01:43.300 --> 00:01:49.300 So I said, so what? He said, well, will they shoot this saboteur at the end of the day? 20 00:01:49.300 --> 00:01:56.300 Because he said it reminds me of the great terror trials of 1937. 21 00:01:56.300 --> 00:02:02.300 And well, what could I say? I said, maybe not at the end of the day, maybe after elections. 22 00:02:02.300 --> 00:02:10.300 But definitely, I think with Greenspan, it was just such a travesty in the sense that 23 00:02:10.300 --> 00:02:17.300 in the sense that this person really, I think, knew what he was doing, he was not stupid, he was evil. 24 00:02:17.300 --> 00:02:26.300 I think I was rereading after he hung up and I couldn't sleep, I was rereading his economic freedom and gold. 25 00:02:26.300 --> 00:02:35.300 And it's wonderful, it's a very well-written essay, very well-written essay in Ayn Rand's Capitalism and Unknown Ideal. 26 00:02:35.300 --> 00:02:45.300 So this person was in a clear mind when he was debasing our currency, limiting our freedom, inflating, just absolutely, absolutely unbelievable. 27 00:02:45.300 --> 00:02:57.300 And here again, the kind of the funny thing about this, I recollect that John McCain, if you maybe remember, John McCain here, I'm not making it up, 28 00:02:57.300 --> 00:03:08.380 Because it looks like I am making it up, but Mr. Greenspan was so popular. 29 00:03:08.380 --> 00:03:11.500 He was like a Roman consul in Washington, D.C. 30 00:03:11.500 --> 00:03:17.020 He was just serving with the cult of personalities Stalin would be envious of. 31 00:03:17.020 --> 00:03:18.700 And you remember McCain. 32 00:03:18.700 --> 00:03:20.700 Yeah, this is a quote from him. 33 00:03:20.700 --> 00:03:24.420 He promised that he would be there. 34 00:03:24.420 --> 00:03:34.420 Just prop him up and put some dark glasses on him, like that. 35 00:03:36.420 --> 00:03:44.420 And even, I would say even Lenin and Stalin never dreamt of any post-mortem appointments. 36 00:03:45.420 --> 00:03:52.420 However, I think that, speaking about Lenin, I think he is in a better shape than Sir Alan. 37 00:03:54.420 --> 00:04:08.700 so speaking about that's the most amazing thing is that if you will read Lord 38 00:04:08.700 --> 00:04:13.420 Keynes that's another sir John right sir Alan you know that Alan 39 00:04:13.420 --> 00:04:18.660 was knighted he is a commander of the British Empire he was probably that's 40 00:04:18.660 --> 00:04:23.700 why he decided to build a command economy in the United States but but 41 00:04:23.700 --> 00:04:29.700 But Lord Keynes also, he wrote things very similar, very similar to Alan Greenspan. 42 00:04:29.700 --> 00:04:33.700 He was saying something, I think, if I, yes. 43 00:04:33.700 --> 00:04:38.700 That's what, yeah, and so he knew what he was doing, and then he said, let's do that. 44 00:04:38.700 --> 00:04:43.700 Let's do that, let's confiscate secretly, and unobserved, and unobserved. 45 00:04:43.700 --> 00:04:52.700 And there was imbeciles, imbeciles after him, that's his best, his best student, his best student. 46 00:04:52.700 --> 00:05:00.260 yes who even who even said that what he said Austrian economics he said there's 47 00:05:00.260 --> 00:05:06.100 the same there's the same validity as a phlogiston theory of fire that's what 48 00:05:06.100 --> 00:05:11.980 his that's I'm not making it up yeah he said that gold bug people meaning all of 49 00:05:11.980 --> 00:05:19.460 us are psychologically pathological so it's just exactly like Soviet Soviet 50 00:05:19.460 --> 00:05:26.860 Union in the sense that people who would disagree with Communists would be put in mental asylums. 51 00:05:26.860 --> 00:05:36.420 Because they're just crazy people. There was a syndrome number 137 in psychiatry textbook. 52 00:05:36.420 --> 00:05:45.060 One psychiatrist showed me. That means the syndrome was negation of obvious achievements 53 00:05:45.060 --> 00:05:53.420 of Soviet Union. So you see this, all these achievements, and you negate that. So you're 54 00:05:53.420 --> 00:06:01.620 just crazy. Well, returning back to, from Washington, D.C. to Moscow, to Moscow. This 55 00:06:01.620 --> 00:06:10.060 is some kind of a, I think, and it's very good that Lew picked up this topic for me, 56 00:06:10.060 --> 00:06:14.680 because it kind of attracted my attention to very unknown, and I think I should write 57 00:06:14.680 --> 00:06:21.400 about the very unknown period in Russian history and that the history of the First World War 58 00:06:21.400 --> 00:06:27.280 because back in Soviet Union and here in the United States that period is usually started 59 00:06:27.280 --> 00:06:30.420 as a period of the communist revolution. 60 00:06:30.420 --> 00:06:36.080 Not many people realize that it was the period of inflation of enormous proportions of the 61 00:06:36.080 --> 00:06:42.020 collapse of financial system of Tsarist Russia which led to this revolution the same way 62 00:06:42.020 --> 00:06:47.620 as a collapse of Weimar Republic led to Nazi governing in Germany. 63 00:06:47.620 --> 00:06:50.420 And this history is kind of... 64 00:06:50.420 --> 00:06:55.220 I would say, well, unlike, say, a lot of neocons for some reason, they hate Tsar. 65 00:06:55.220 --> 00:06:57.620 They're kind of like real Trotskyites. 66 00:06:57.620 --> 00:07:06.020 So they hate Tsar, and I would say Tsar was much better than Bolsheviks that came after him. 67 00:07:06.020 --> 00:07:09.620 Tsar, well, at least he didn't kill so many people. 68 00:07:09.620 --> 00:07:29.620 I looked at the history of murders in Tsarist Russia in the 19th century they put to death 536 people under Stalin they were putting to death 12,000 a day, 12,000 a day, so that's 536 in 100 years, in 100 years, that was the Tsar's record. 69 00:07:29.620 --> 00:07:39.620 Tsars were inflationists. Why they were inflationists? Because they were all engaged in wars. 70 00:07:39.620 --> 00:07:48.620 In the 18th century, out of 100 years, Russia was in wars for 58 years. In the 19th century, for 44 years. 71 00:07:48.620 --> 00:07:57.620 So to fund all these wars, and in Russia there was the tax system, because the country was so poor, 72 00:07:57.620 --> 00:08:11.620 And especially the peasants, especially the South Russia and Siberia, were pretty independent people and they were kind of a very nice tax evaders and so it was very difficult to collect taxes. 73 00:08:11.620 --> 00:08:20.620 Not many people realized that Russian Tsars, they didn't know how to collect taxes and they would put taxes, for example, on beers or on windows. 74 00:08:20.620 --> 00:08:25.620 That's a progressive tax. Can you imagine? Siberia, you have tax on windows. 75 00:08:25.620 --> 00:08:28.980 That means if you have windows in Siberia, you're a rich person. 76 00:08:28.980 --> 00:08:35.220 You can pay a lot for even more than Wisconsin Energy is taxing us. 77 00:08:35.220 --> 00:08:41.780 And so the taxmen would just go collect taxes, and if not, they'd just throw the bricks into the windows. 78 00:08:41.780 --> 00:08:53.860 And that was then, however, Russian government, the Tsar's government, they established in 1861, 79 00:08:53.860 --> 00:08:57.140 And they established that it kind of was a bad year for everybody. 80 00:08:57.140 --> 00:09:06.900 And they established the Central Bank, Central State Bank of Russian Empire, of Russian Empire in St. Petersburg. 81 00:09:06.900 --> 00:09:10.220 And this bank began to inflate right away, right away. 82 00:09:10.220 --> 00:09:12.900 What they did, Russia was on the gold standard. 83 00:09:12.900 --> 00:09:19.660 But then they were all the time printing more and more paper, as they called it, ambassadors of gold. 84 00:09:19.660 --> 00:09:27.220 So there were so many ambassadors representing so little that they had a great Russian writer, 85 00:09:27.220 --> 00:09:32.140 Saltykov Shchedrin, he was like H. L. Menken of Russia in the 19th century. 86 00:09:32.140 --> 00:09:38.820 He wrote that now they're giving half, I mean for paper money, for paper giving half. 87 00:09:38.820 --> 00:09:44.620 Tomorrow I think they will give us the middle finger. 88 00:09:44.620 --> 00:09:53.500 So that was, and so Russia was in this kind of inflating state, Russian ruble. 89 00:09:53.500 --> 00:10:00.700 There's a lot of people who idealize Southeast Russia and saying that, well, the currency was very stable, the golden currency was not. 90 00:10:00.700 --> 00:10:07.020 Yes, they made the coin golden coins. However, these coins immediately disappeared because of Gresham law. 91 00:10:07.020 --> 00:10:12.540 People ended up with paper currency because all golden coins before even this, 92 00:10:12.540 --> 00:10:22.780 The First World War went into the treasure, went into the, you know, that gold is performing the function of the store of value perfectly. 93 00:10:22.780 --> 00:10:29.660 So immediately gold disappeared, people ended up with paper money, paper money was losing its value. 94 00:10:29.660 --> 00:10:35.180 Then came the war of 1904-1905, the Russian-Japanese War. 95 00:10:35.180 --> 00:10:38.860 It was amazing that Russia had a revolution at that time. 96 00:10:38.860 --> 00:10:44.860 And the Prime Minister, Sergei Vite, he came to the Emperor and said, 97 00:10:44.860 --> 00:10:48.860 Emperor, look, we have revolution in our hands, what should we do? 98 00:10:48.860 --> 00:10:53.860 And he said, declare the war on Japan. 99 00:10:53.860 --> 00:10:58.860 And that's exactly, I think, what our people in Washington know how to do well. 100 00:10:58.860 --> 00:11:04.860 That if you have one type of crisis, you create another one, even a bigger crisis. 101 00:11:04.860 --> 00:11:23.860 I think Dr. Paul was absolutely right when he said that government is creating crisis, and the crisis would increase the power of government, whether, I think Heinlein said, whether this crisis is real, fabricated or imaginary. 102 00:11:23.860 --> 00:11:32.860 We have right now multiple crises, imaginary, fabricated, real, piling on one another, looking for more government. 103 00:11:32.860 --> 00:11:38.740 Mr. Greenspan, when attacked by Waxman, he said I was wrong. 104 00:11:38.740 --> 00:11:43.220 He said 40 years, he was in his tender age of 82, 105 00:11:43.220 --> 00:11:46.020 he admitted that all his life was failure. 106 00:11:46.020 --> 00:11:49.900 He said that 40 years I was on the wrong impression 107 00:11:49.900 --> 00:11:54.340 that laissez-faire can be a good policy. 108 00:11:54.340 --> 00:11:56.540 I don't know how he was under this impression 109 00:11:56.540 --> 00:11:59.860 because he never practiced this policy. 110 00:11:59.860 --> 00:12:29.860 But from another hand, from another hand, that was his, he admitted that the market model, he said, that was adherent to, again, I made it up, because people just would think I'm making it all up, but, yes, he said, he said, I found a flaw, I don't know how significant or permanent it is, but I've been very distressed by that fact, you can imagine, it's, again, an 82nd year, 111 00:12:29.860 --> 00:12:39.860 A year of his life. I think he thought he was on Lubyanka already and would need to trash everything. 112 00:12:39.860 --> 00:12:45.860 So Russia began to inflate in 1904-1905 to pay for the Russian-Japanese war. 113 00:12:45.860 --> 00:12:51.860 Russia lost this war and ended up with a huge national debt, mostly to France. 114 00:12:51.860 --> 00:13:03.740 France was bankrolling Russia, Russian Tsars, and Russia was also, they were just selling this Russian national debt in France, in Germany, in Britain, 115 00:13:03.740 --> 00:13:08.660 and the whole world was holding this Russian national debt so Russia could fight Japan. 116 00:13:08.660 --> 00:13:17.380 So Russia lost the war to Japan, they had a revolution, under this revolution they immediately again expanded the power of government, 117 00:13:17.380 --> 00:13:23.380 And Mr. Stolypin, the new prime minister who came to power because of this revolution, 118 00:13:23.380 --> 00:13:27.140 he immediately had beaten all the records in killing people. 119 00:13:27.140 --> 00:13:33.300 They killed 564 people in the 19th century, they killed 12,000 right away. 120 00:13:33.300 --> 00:13:38.980 And so I think they prepared by doing that, they prepared the first world war, first world war, 121 00:13:38.980 --> 00:13:45.540 and besides that they prepared, they think that they were digging the grave they ended up in, 122 00:13:45.540 --> 00:14:08.540 I never definitely would wish for Nicholas II, and especially for his seven children, to be murdered that way, as they were slaughtered like animals, and he was killed last, so he saw all his children to perish first. 123 00:14:08.540 --> 00:14:20.540 but definitely economic policies of Nicholas II and they played a pivotal role in bringing Bolsheviks to power. 124 00:14:20.540 --> 00:14:28.540 First World War was, as Hans Hoppe rightly wrote, that was the end of civilization as we knew it, 125 00:14:28.540 --> 00:14:34.540 the end of 19th century classical liberalism, was the end of freedom in Europe, 126 00:14:34.540 --> 00:14:46.540 The end of freedom in Europe. Europe, the empires, now we demonize these empires, but look at the Austro-Hungarian Empire. 127 00:14:46.540 --> 00:14:54.340 Austro-Hungarian Empire, father of Ludwig von Mises, a Jewish engineer and merchant, was knighted. 128 00:14:54.340 --> 00:15:01.540 Can you imagine that that would happen in Austria under Nazis? No, he would be sent to Auschwitz. 129 00:15:01.540 --> 00:15:08.540 or can imagine Soviet Union under Stalin, he would be sent to Siberia for all his entrepreneurship and love of freedom. 130 00:15:08.540 --> 00:15:21.540 So Austro-Hungarian Empire, which brought us Austrian School of Economics, which brought us the best music, the best literature, the best ballet in the world in the 19th century, that empire collapsed. 131 00:15:21.540 --> 00:15:38.040 Ottoman Empire, again, Ottoman Empire is being blamed for being, Ottoman Empire had way more religious freedom than all of these countries which are, which were kind of, it was amazing that the Minister of Finance usually would be Jewish, 132 00:15:38.040 --> 00:15:43.520 Minister of Foreign Affairs, usually would be Christian, orthodox Christian. 133 00:15:43.520 --> 00:15:48.200 So that was the empire which was maybe as bad as it was, 134 00:15:48.200 --> 00:15:54.240 but it was way better than what we got at the end of that. 135 00:15:54.240 --> 00:15:58.000 If you will look what happened even to Turkey itself. 136 00:15:58.000 --> 00:16:03.320 Turkey itself, there is a wonderful Austrian economist there, 137 00:16:03.320 --> 00:16:07.680 and Dr. Ayala, maybe you heard of him. 138 00:16:07.680 --> 00:16:19.360 and Dr. Ayala, yes, he is speaking on the TV, he can compare Ataturk to Stalin and one said that he didn't kill so many people as Stalin 139 00:16:19.360 --> 00:16:25.760 because Stalin kind of is a champion, I think he killed more than everybody else combined 140 00:16:25.760 --> 00:16:34.080 and by then he was thrown out of everywhere and he was sentenced for one year of jail, for one year of jail 141 00:16:34.080 --> 00:16:43.080 Well, unfortunately, it was suspended sentence, but still, that's the Turkey today, so then we had the German Empire. 142 00:16:43.080 --> 00:16:50.080 German Empire, German Empire, if you would go to former German colonies like today's Namibia or Tanzania, 143 00:16:50.080 --> 00:16:55.080 you would see that everything worth of looking at was built by Germans. 144 00:16:55.080 --> 00:17:02.080 So they ended up with the German Empire, they ended up with the Bolshevik revolution in Munich. 145 00:17:02.080 --> 00:17:06.080 That was the Bavarian Soviet Socialist Republic, not many people realized that. 146 00:17:06.080 --> 00:17:10.340 But it was communism in Germany with a lot of murders, a lot of murders. 147 00:17:10.340 --> 00:17:18.740 Fortunately for German people, they kind of arrested that revolt pretty soon, so they couldn't kill so many. 148 00:17:18.740 --> 00:17:27.440 So they left these people to be killed by Nazis, another form of communism, another form of socialism and totalitarian state, totalitarian state. 149 00:17:27.440 --> 00:17:57.440 So Russia in the war lost two and a half million people on the front, on the front, then mortality inside Russia increased greatly as well, there was a mass starvation of people, inflation roared during the First World War, retail prices in Moscow doubled in the first two years of the war, and then were accelerating exponentially in 1916 and early 1917, they more than trebled, by the end of summer 150 00:17:57.440 --> 00:18:06.440 In the year of 1917 already, inflation hit the mark of 15,000% according to the British Consul in St. Petersburg. 151 00:18:07.440 --> 00:18:16.440 Russian indebtedness mostly to France and Britain grew fivefold since 1914. 152 00:18:17.440 --> 00:18:21.440 So Bolsheviks when they came to power, what they did, they immediately repudiated these debts. 153 00:18:22.440 --> 00:18:25.440 They said, well, what we owe you, we forgive you. 154 00:18:25.440 --> 00:18:34.440 that was that was what what Lenin said that was not me yeah so that's them I 155 00:18:34.440 --> 00:18:39.600 think they they should have been doing that when so communism collapsed and I 156 00:18:39.600 --> 00:18:45.200 was one of the proponents of that and I was I was working as one of economic 157 00:18:45.200 --> 00:18:48.880 advisors to Gorbachev's government I wasn't the advisor I wouldn't take the 158 00:18:48.880 --> 00:18:54.880 I don't blame, but I was an advisor, nobody listened to me, and look what happened. 159 00:18:55.880 --> 00:19:02.880 But one of the points we were trying to make, the group of reformist people in the government at that time, 160 00:19:03.880 --> 00:19:07.880 we were trying to persuade the government to forgive the debts again. 161 00:19:08.880 --> 00:19:12.880 Because it was a Soviet Union debt, and who was investing in the Soviet Union? 162 00:19:12.880 --> 00:19:17.760 Union. That people, even if you invest in a bad, well, today it doesn't mean anything. 163 00:19:17.760 --> 00:19:24.200 Today, no matter where you invest, the government would bail you out. But at that time, even 164 00:19:24.200 --> 00:19:29.640 I would say, even I'm in the United States 19 years, and the country changed so much, 165 00:19:29.640 --> 00:19:35.640 I mean changed drastically, drastically. I think that this kind of bailout even 19 years 166 00:19:35.640 --> 00:19:41.720 ago would be unimaginable, unimaginable. But at that time, at that time, I think that the 167 00:19:41.720 --> 00:19:52.320 The logical thing would be not to pay the debts which were made by Rockefellers and other establishments on the Wall Street 168 00:19:52.320 --> 00:19:59.320 who were heavily investing in the regime which was murdering its people left and right, mostly left definitely. 169 00:19:59.320 --> 00:20:18.320 Well, Russia went out of the war in 1921 only. In 1921, they signed a treaty in Brest-Litovsk with Germany in 1918, so the war with Germany ended up in 1918. However, there was still a civil war. 170 00:20:18.320 --> 00:20:48.320 During that civil war, Lenin decided to experiment with currency as much as he possibly could because according to delusions of this person, of Karl Marx, money should be abolished because money is nothing but exploitation, exploitation, the point was that they need to demonetize gold, to dethrone gold, as Marx and especially Lenin, Lenin came up with this 171 00:20:48.320 --> 00:20:58.320 with this unbelievable idea that we should build toilet commodes out of gold. 172 00:20:59.320 --> 00:21:09.320 He went on and on and on, he went into detail saying that gold can be dethroned only if we would put inside of the urinals. 173 00:21:09.320 --> 00:21:15.320 He probably felt himself as another Joe the plumber. 174 00:21:15.320 --> 00:21:28.320 And so his point was that that's what we should do. And amazingly enough, it's only capitalism that made it happen. 175 00:21:28.320 --> 00:21:37.320 The Chinese guy who was a student of Lenin and he became very rich, he defected to Hong Kong, 176 00:21:37.320 --> 00:21:48.320 is where I've abandoned his idiotic views except this delusion that to build a toilet out of gold, this is six million dollars toilet, can you imagine? 177 00:21:48.320 --> 00:22:00.320 But still this toilet is much better investment than made by all governments all over the world, all over the world. 178 00:22:00.320 --> 00:22:05.320 At that time Bolshevik revolution, especially with this bold attitudes toward gold, 179 00:22:05.320 --> 00:22:17.320 It attracted a lot of sympathy in the west. Ludwig von Mises was, I think, the only one who in 1918, not 1920, 1918, he wrote this short essay, 180 00:22:17.320 --> 00:22:26.320 Economic Calculation on the Socialist Commonwealth. This is a wonderful piece which, and he predicted, and he was a lone warrior at that time, 181 00:22:26.320 --> 00:22:31.160 saying that communism would not work because it cannot work. 182 00:22:31.160 --> 00:22:37.000 It would work only unless they would shoot people. 183 00:22:37.000 --> 00:22:39.920 So they shot enough, I think. 184 00:22:39.920 --> 00:22:44.360 Not many people realize the true story of communism. 185 00:22:44.360 --> 00:22:47.440 As the countries, many countries, devastated completely. 186 00:22:47.440 --> 00:22:48.440 Baltic states. 187 00:22:48.440 --> 00:22:54.320 Every third person disappeared between 1940 and 1952. 188 00:22:54.320 --> 00:23:01.400 In Russia itself, 42 million perished under Stalin, 18 million under Lenin. 189 00:23:01.400 --> 00:23:05.920 Nobody knows about that. People were starved to death, treated like pigs. 190 00:23:05.920 --> 00:23:09.840 It just was unbelievable. However, they didn't stop on that. 191 00:23:09.840 --> 00:23:18.680 Yes, and I'm saying that. And this was, at that time, another economist who is considered to be the greatest economist of the 20th century. 192 00:23:18.680 --> 00:23:26.360 He was writing to his mom, who was, if you remember, she was a mayor, first female mayor in the United Kingdom. 193 00:23:26.360 --> 00:23:29.400 She was mayor of township of Cambridge. 194 00:23:29.400 --> 00:23:33.960 And her son, her beloved son, was John Maynard Keynes. 195 00:23:33.960 --> 00:23:35.160 He wrote to his mother, 196 00:23:35.160 --> 00:23:39.560 Well, the only course open to me is to be biantly Bolshevik. 197 00:23:39.560 --> 00:23:44.120 And as I lie in bed in the morning, I reflect with a good deal of satisfaction 198 00:23:44.120 --> 00:23:54.560 that because our rulers are as incompetent as they are mad and wicked, one particular era of particular kind of civilization is very nearly over. 199 00:23:54.560 --> 00:24:01.160 And that was Lord Keynes. That was Lord Keynes. It's called savior of capitalism, savior of capitalism. 200 00:24:01.160 --> 00:24:13.680 So then communists, definitely Bolsheviks, when they debased the currency, well, they returned back to the gold standard window from when the people began to die like flies, 201 00:24:13.680 --> 00:24:19.120 When they abolished money whatsoever, can you imagine, the huge country went into barter. 202 00:24:19.120 --> 00:24:24.200 Workers were paid with the fruits of their labor, so nothing. 203 00:24:24.200 --> 00:24:28.600 And people, 18 million people perished. 204 00:24:28.600 --> 00:24:42.000 Even Lenin, in 1923, on a deathbed, he realized that this disaster can end up in total disappearance of Russia from the map of the world. 205 00:24:42.000 --> 00:24:45.680 And so he declared new economic policies, new economic policies. 206 00:24:45.680 --> 00:24:51.320 Stalin was in charge of this new economic policy in 1929. 207 00:24:51.320 --> 00:24:55.040 From 1924, they had a window of gold standard in Russia. 208 00:24:55.040 --> 00:24:59.880 And sure enough, they immediately returned back. 209 00:24:59.880 --> 00:25:05.920 They revitalized the economy, the economy which was completely disrupted, completely destroyed. 210 00:25:05.920 --> 00:25:15.620 By 1928, this economy was already twice larger than the economy under Tsars in 1913, before the war, before the war. 211 00:25:16.620 --> 00:25:25.320 And so, sure enough, in 1929, Stalin already felt confident enough to begin killing people again and seizing their property and whatnot. 212 00:25:25.520 --> 00:25:35.120 And I think that Stalin, from the very beginning, he was evil enough to have this kind of plot, that people would make money, would show this money, 213 00:25:35.120 --> 00:25:40.120 and then all these hundreds of flowers would bloom so you can go and pick them up. 214 00:25:40.120 --> 00:25:42.620 And that's what exactly they did. 215 00:25:42.620 --> 00:25:52.120 Well, I know that time is running out, but just kind of like the stages of the demise. 216 00:25:52.120 --> 00:25:58.620 Well, the Soviet Union, the worst kind of inflation was during the Second World War. 217 00:25:58.620 --> 00:26:04.620 Inflation under communism does not take the sort of prices rising. 218 00:26:04.620 --> 00:26:34.620 price already high, as Russians would say, we don't have inflation, we just have high prices, so they have high prices, but because if that's controlled prices, then you see shortages of everything, if you have inflation, which is suppressed inflation by price controls, you have the disappearance of almost everything, so they have mesmerizing shortages of everything, in 1947 they wiped out the 219 00:26:34.620 --> 00:26:42.620 all their currency all together, and everybody's savings as well, and just printed new rubles. 220 00:26:42.620 --> 00:26:47.620 These rubles, suppressed inflation, increased tenfold to 1961. 221 00:26:47.620 --> 00:26:54.620 At that time, Mr. Khrushchev was in France, waiting for President Eisenhower to meet with him. 222 00:26:54.620 --> 00:27:01.620 At that time, Soviets, they shut down U-2 plane, maybe you remember, with Harry Powers, a pilot, 223 00:27:01.620 --> 00:27:04.700 and Khrushchev decided not to meet with Eisenhower. 224 00:27:04.700 --> 00:27:09.620 However, in France at the same time was a monetary reform in 1960. 225 00:27:09.620 --> 00:27:15.980 They just moved the decimal point two zeros to the left. 226 00:27:15.980 --> 00:27:18.380 And Khrushchev, immediately upon return, 227 00:27:18.380 --> 00:27:23.380 he gave his finance ministry two months to do the same. 228 00:27:23.380 --> 00:27:30.780 They literally ran out of paper and ink printing new money. 229 00:27:30.780 --> 00:27:34.820 And then they moved this decimal point to the left, to two points. 230 00:27:34.820 --> 00:27:37.220 And then after that, the first thing Khrushchev said, 231 00:27:37.220 --> 00:27:40.780 we have the same money as was in 1920s. 232 00:27:40.780 --> 00:27:43.140 We have the price level is exactly the same. 233 00:27:43.140 --> 00:27:53.460 So that means that they practically wiped away 1,000% inflations in 1920. 234 00:27:53.460 --> 00:27:55.700 Yes, that's what it is. 235 00:27:55.700 --> 00:27:58.060 And they were saying there's no inflation under socialism. 236 00:27:58.060 --> 00:28:04.340 Look, the prices right now are exactly like they were in 1925, in 1925. 237 00:28:04.340 --> 00:28:07.260 So that's the end. 238 00:28:07.260 --> 00:28:14.900 Well, I know that my time is over, but on the good side, I think, well, 239 00:28:14.900 --> 00:28:17.900 Russians wouldn't say that's a good side for things. 240 00:28:17.900 --> 00:28:21.260 They would say pessimists usually is a better-informed optimist. 241 00:28:21.260 --> 00:28:27.420 And on this cheerful note, I would like to, 242 00:28:27.420 --> 00:28:34.820 But I think there's another Russian saying we should keep in mind, it's a perfectly American saying also, 243 00:28:34.820 --> 00:28:39.220 that the only lesson of history is that it does not teach us anything.