Shownotes Transcript
Perfect intellectual. Oh, yeah. Welcome to Transistor Radio. I'm John from Agentometry. I'm here with Doug, Fabricated Knowledge, Dylan, whatever, and Jordan Schneider. So yeah, tariffs. I guess that's what we're talking about. This is now not a semiconductor podcast, but now a tariff podcast. I miss the time when we talked to semiconductors.
Well, dude, don't worry. It's in the deepest of winters, but inside the deepest of winters, there's an eternal summer. And that'll be when we talk about semiconductors again. Okay? I thought that was when we reshort all American manufacturing and made America great again. Or put fabs in space. Or space fabs. Space fabs. We tariffed the penguin island. We did not tariff the moon. So...
Yeah, plus Elon Musk. Dude, Elon Musk is, I mean, he's walking away pretty hardcore. Have you noticed all the people walking away? Wait, Elon left? Elon's gone out. He's out contractually. Doge ends in May or something like that. But Elon, this week, he pumped for a zero trade zone between the US and EU.
And Ackman is starting to have some bargaining and crying on Twitter. Tremath, Tremath staying very strong. So we're like, you know, if all in pod is like, you know, the total grifter, a, a squad, we're like the grifter B squad. This is, we could be the all in podcast. We could be like the B squad all in. Like we just need to record more than one every four moons. Yeah. Yeah. And then we also need to talk about more topical things sometimes.
but yeah and we need okay here's your chance this is as topical as it gets okay because that's happened i i don't even know where to start how do we i feel like ask me a question let's start with that yeah just those questions what does it all mean um i think we're seeing an acceleration of the end of the dollar-based world order um what that means is the next question i mean so essentially there's been a long decade or you know century essentially of post
post Bretton Woods dollar based reserve currency, right? So essentially what happened was United States awesome economy, essentially the most stable economy, also everyone's ally. So they essentially said, hey, we're going to do clearing in the dollar. And then also we're going to unpack
Essentially, this was all made, by the way, during the first Great Depression, which vibes-wise, I feel like we're repeating some of the exact same things over and over. Did the terrace, all this stuff. And then everyone essentially was linked together because of gold. And so because everyone was linked together because of gold, essentially it was a contagion.
deflation. So if someone had a massive deflationary spiral and their currency was linked to gold and then you know someone across the you know across the border also had a gold-based currency essentially everyone became linked to deflation. So it became a global giant spiral and so they're like wait why don't we all have floating currencies so that each individual central bank has monetary control so they can you know raise or lower interest rates and then they can all float free but we need something to clear all this and they chose the dollar.
So now we've been living in Bretton Woods for a really long time. And pretty much what I think the vibes are is like the United States world order is essentially completely dictated on the fact that you buy into the dollar system. And so instead of like, okay, so I wrote about this in a piece. Essentially, instead of like enforcing the world order with, you know, nukes and tanks and planes and stuff, you can enforce it with dollars. Because if everyone essentially is,
Balls the wall levered into this giant shared financial entity. And your financial entity happens to cross-own the other person's cross-financial entity. Essentially, everyone has a stake in this giant world order financial entity, which just so happens to be the assets of the United States and the levered future of it, essentially. Specifically, U.S. Treasuries. And so, yeah. Yeah.
Everyone buying in pretty much is the most, it's the most common paper. It's the most liquid market in the world. Everyone relies on it for everything.
And what we've done is essentially you said, okay, well, because everyone relies on for everything and you've been coming in and we've essentially been loaning out forever, all of a sudden we just shut the gates and we're shaking everyone down. The vibes from doing that, not so good. And if you do the math, 90% of global trade is not with the United States. So everyone's kind of
calling Trump's bluff and is saying, well, what if we just become each other's trade partners and Europe runs a deficit and China does the manufacturing dumping and we can just replace, we can rip and replace the US with the EU and boom, there we go. Post dollar world order. Interesting. So what would be the gold in that case? I don't know. What would be the US dollar? The RMB or the euro or what?
I don't think the RMB... John, come on. It's Bitcoin.
Yeah, that's okay. So it's Bitcoin. I think one of the things that's like really important in order for you to have a reserve currency is you have to have a deficit because if you didn't have a deficit, essentially there is no liquidity. There's no global liquidity in paper, right? If every, if you're just like gobbling it all up by essentially running a surplus, then it doesn't really help to have all these, like, you know, have like these Chuck E. Cheese coins that are floating out a side of Chuck E. Cheese that everyone just happens to have and use constantly. Um,
So I think the only place where you could do it, actually, is Europe. If Europe goes balls to the wall with deficit spending, boom, they start giving out euros to everyone. But to be clear, the thing that's so scary about this is 80% of trade is settled in dollar, and it's a very, very concentrated, levered thing. And now we are making a big shift away from it very quickly. And so...
You look at it, you think of it like, you know, 100 years of world trade order getting to here. And then we're like, let's, you know, let's completely destroy it in four years. And then that's going to be probably pretty bad. So it's kind of where we're at. I don't know. This is really depressing, but I can get even more depressing, honestly.
I think we're about to see a flight from dollar assets. I think, I mean, like to be clear, things can change very quickly because Trump can announce a deal, but I do think the vibes are bad. I mean, the RMB, I don't know if you guys saw this headline, but essentially like there's going to be an RMB based, uh,
clearing clearing exchange that uh china just signed up with the tunnel midway eastern bank sure it covers 38 of the global global trade obviously i don't think anyone really wants to be r b as the as the float because they they run such a surplus it's kind of messed up and they control their own currency so yeah i don't know but i think there's a real chance that we're going to d dollarize really quickly and essentially trump's willing to to say like
F the dollar regime. I value manufacturing, but doesn't have a real glide path from one to another. And so we'll just blow up that whole old world order, and then we will raise a new one. But the problem is, the gap in between is going to fucking suck. How is Europe going to run such a huge deficit? I don't know. To be clear, this is not... Dylan, I mean...
Well, they don't have the wealth for it, right? Like, they don't... Like, they're just not as wealthy. Yeah. So, okay. They're older. Way older. They are way older, but you have to think about this, too, is, like, what is... Something you have to think about is... But water? Wealth is... I was going to say a lot of the deficit is, like, people from foreign countries, the current account surplus, right, is, like, people from foreign countries buying assets in America because assets in America have, like, super backing and, like, they aren't taxed a lot, right? Whereas in Europe, it's, like...
Not quite the case. I mean, they have good property rights, to be clear, but not as much as America. That's not, Dylan, but that's not what it comes down to. Why do they buy assets in the United States? It's not because they go, like, more often than not, yeah, you can do an investment in the United States, but oftentimes the liquidity happens because you run a giant trade surplus against the United States. So it's like, hey, try it in the United States. Does a crap ton of business together.
But at the end of it, essentially, the United States is purchasing all this. And then the seller essentially ends up with some money left over. More often than not, you don't repatriate that cash. You essentially let, especially in the United States where there's like high rule of law, you let the cash build up in an entity in the United States. There's two places. There's like essentially like the easiest place for it to go is to U.S. Treasuries. That's like the reason why U.S. Treasury is essentially declaring cash.
And especially papers like the clearing, the clearing paper of the entire world. And so like, yeah, Dylan, these people like the investment first perspective of deficit spending isn't correct. The reason why there's a giant deficit isn't because people are investing heavily. That's actually has it backward. People invest heavily because they have a giant trade surplus with us.
So, essentially, we ran small surpluses and then we ran big-ass deficits during downturns. And so that's what we did, like the classic Keynesian model. Over a long enough period of time, we were, like, relatively surplus-y in the very beginning. But also you could argue global trade was a lot smaller.
I think it's one of the weird benefits that has happened from having such a large deficit is having this aspect of having papers abroad. I don't even know if you're familiar with the concept of like Euro dollars. Euro dollars is like the offshore dollar account that's linked to Euros. And it's like a completely made up fake currency that's just denominated in clearing for Euros. Pretty cool that it exists as a concept. Oh man, I should... Sorry. Now my brain's like, man, I should have shorted that. But anyways...
Yeah, I don't know. It's just like this...
It's just hard to be like, undo this giant levered trade that happened for like a long, long, long time. I mean, dude, this is not like new, but we kind of walked down this path anyways. Warren Buffett, basedly enough in 2003 was like, bro, we are walking down this ginormous mistake by essentially having these giant deficits. And what we probably need to do is, you know, essentially we need to have some kind of way to fix it.
And he suggested terrorists, didn't he? He did. But it's a little different because you can do it when it's light like that, but now, you know, the whole world is balls long in the United States. Like, truly balls long in the United States.
In 2003 also, I would say that the U.S. manufacturing base wasn't as shriveled as it is today. Yeah. So question, why wouldn't the deficit grow and the account surplus grow because of tariffs, at least in the short term? So I think if you kept income taxes the same—
and you did it at the same time, it would, you know, think about it's like a giant tax essentially against global trade. So the deficit probably doesn't grow, right? But the problem is... The trade deficit and the current account surplus, not the federal budget. That's kind of a hard problem, dude. I don't know if a tariff is going to magically increase a current account deficit. And this is the reason why people have been like...
Like, this is the reason why people are really pissed about the formula. Because the formula doesn't actually make sense if you think about it.
And this is like one of the examples of it where it's like, does this actually, can we actually get this number to zero? Or if like, I think some aspect of it is like undercounted. Also, it kind of penalizes people who do the most business with us. And it doesn't really account for the fact that I don't think it really accounts for services. It's very goods focused. So I don't know. I don't think it really solves the problem. I think it's just going to destroy demand. And then demand is going to be picked up by the rest of the world who does hardcore deficits. Yeah.
Do you think it's an opportunity for domestic players in the United States to meet American demand? It's import substitution, right? Yeah. I think foreign countries will just build shit in Mexico and it'll be great. I mean, isn't that not the point of this, Dylan? Because if a foreign company builds shit in Mexico, then what's the point of it? It's essentially just a nearshoring.
Right. Like you get. I mean, I mean, it depends, like from the Trump administration standpoint, probably not what you want. But from like a global supply chain security and dispersion of manufacturing out of just East Asia. Makes sense. Yeah. How much is a labor is the labor component in a particular good? Like, is it still a particularly high percentage? A lot of this is just capital intensive.
Why not move this to the United States? Why not have some... Why can't Walmart just be like, hey, look, we're going to build factories all across Bentonville and just start pumping these out one by one? We hire a bunch of Chinese people and...
and give them green cards and then have them build factories. No one's getting green cards. We deport them. We deport them first. And then we buy a robot. I mean, that's kind of the problem, man, is that we don't have the labor to support ourselves. We saw this during COVID, right? When we essentially, during COVID,
We essentially sent all the seasonal workers home, and then there was a ginormous shortage of labor almost everywhere. My favorite anecdotes were like walking through the middle of nowhere, you know, in 2021, and they'd be like, yeah, there's no one who's able to staff the store anymore because we used to
have like i don't know freaking mexican person or someone from like switzerland or something come in for the summers um so i think that's going to be a real issue is that this would work if you just flooded labor right but we're doing the opposite on that as well we're trying uh you know illegal immigration is is like one of them so maybe we do legal immigration i don't know but it doesn't seem like we'll be able to move the number the amount of numbers that we need quickly enough
Doug, there was the whole narrative or thing about investments in industrial skyrocketing in 2023.
Or something like that? What's ever happened? Okay, so one of our largest deficit spending in the last two years has specifically been the IRA, which is the Inflation Reduction Act. Essentially, it's just a ginormous set of subsidies that was ginormous deficit spending, specifically focused on rebuilding infrastructure in the United States. Most of this came through a ton of grants. And essentially, we... But if you think about it, like...
kind of doesn't make sense we've just been like yolo since 2000 essentially we just spend through it no matter what we just freaking spend through it um and so we had all this spending we're doing like you're supposed to run a surplus during a good time so we're actually running this ginormous deficit uh like the worst fiscal deficit ever because you're just yoloing it into infrastructure in the united states so the second trump came in he paused it um and that's
bad for like GDP but like I mean you could probably argue is a little he actually positive yeah dude the money isn't flowing the money might restart this month what do you what so what about the parts that the spending that they can't control like the social security stuff the Medicare stuff like this is where it becomes really hard honestly you can talk about defense and all this stuff none of this even holds a candle to the nut like go look at the spending dude it's social security
I don't know how we could possibly fix that one, if I'm being honest with you. There's just no way, man. Like, pretty much, okay, like, truly the most based way to do this is probably to kill some Social Security. I'm sure they're going to kill some Medicare. I'm sure they're going to kill some National Defense. I think there's a more based way than even killing some of Social Security and Medicare. It's called killing old people. Oh, my God. Oh, my God.
Oh my god. You heard it here first. Dylan is going to get a chainsaw. I never said I was based. Death panel Patel. In fact, I personally believe that it is time to buy woke...
And it's not woke one, it's woke two, right? And woke two, you know, it's actually a triangle between like based cringe and woke, right? And definitely like, you know, let's call it 2000. I don't know when was peak woke, but peak woke was peak, not just woke, but woke cringe, right?
And then based for a while was based maximizing, but then based really over the last year has really slid into the omega cringe spot. And so based cringe, you're maximizing on those two axes. So now I'm pushing for a new ideology, which is maximizing on based woke. So yes, we take an economic approach to social security, but
That would be based woke, actually. Yeah, I would consider that based woke. Yeah. So, I mean, here's a... Can we just shift up the ages slowly? I mean, okay, guys. You make the cost of living adjustments like negative 4% a year so the payments just don't grow.
I really think something my favorite, most of my, an ax my old boss used to grind, and I actually do really agree with this one. Guys, what was the life expectancy of people when they freaking made social security? It's like, it was like under 65. It was under 65. Yeah. It was supposed to be to keep the old guy on the quarter from dying. Okay. And now everyone is freaking 85. People are living a hundred. You know, it's like, it's so guys just make it older. Just make it older. I mean,
Yeah, but a lot of these people in their 70s or 80s, a lot of these people are just not healthy. They're not a healthy old, right? It's like diabetes, they have arthritis. A lot of these are super old and very disabled. The other base for Blink is that you fully subsidize all health care, but you don't pay for type 2 diabetes because that's self-imposed.
ethically right like ethically you have a point to stand but like so oh my god so what you're saying is we're going hyper risk risk uh risk adjusted scores everyone gets a risk adjustment score that's what we should do i mean like this is doug's death panel but not okay so hey so so not ironically this is the whole point of medicare uh well uh the um medicare advantage was essentially make a risk adjustment so like people who took people who are sicker got paid more
Right. So what if essentially we had a new verse? This is actually this is actually based woke. OK, a new version of a new version where we have our own risk adjustment score every year during our universal health care. There's a check in and you get a score. And if you go over the score, you pay you pay crap tons of money. In fact, you pay infinity dollars.
And especially if it's a boy. Just bet on yourself. Yeah. I like it. Yeah, it's every year. So all of a sudden, dude, this gets announced. Limit up gyms, dude. Planet Fitness, up 100%. Everyone has to go. You have to get fit or you're going to die from your debt payments. I think kind of the weird thing is just kind of like a lot of – you're right in that a lot of the pensions and the Medicare spend is out of control. I think –
Maybe Trump can touch it, but is that something that he'll decide to touch at all? No, absolutely not. Actually, maybe he does because he doesn't care about getting re-elected anymore. He doesn't have to be re-elected fourth term. There's not... No Republican is going to vote to hurt
Medicare. Yeah, no, essentially the ultimate goal. Like, hey, this is the problem. It's all incentives, okay? It's all incentives. Because if you're an old person which votes in 100% elections because you get freaking beautiful money from the sweet seed of the government, you're going to vote for... Like, the second you hear someone cutting Social Security, bam. So what they should do, the Democrats and the Republicans, should have a based woke convention. And they both agree that...
to cut Social Security. No choices. Maybe you inflate the dollar so the real power is like, it's just sort of vanishes. It's just making CPI erroneously, or whatever the cost of a living adjustment for Social Security, erroneously low. And then having high inflation anyways. You can inflate it away. Which effectively inflates away the Social Security obligation. Because even if someone comes in and they run on like, oh, we're going to bring back Social Security payments,
They're going to just do a cost of living adjustment for that year. They're not going to be smart enough to be like, oh, wow, we've underfunded it for 10 years or under-raised it for 10 years. And so now, you know, whereas it used to be enough to live on, now it's not or whatever, right? Like, you know, so there's that sort of element. Kind of like a minimum wage. I mean, honestly, I'd be down for that. Based woke is having a minimum wage but never increasing it. So it's actually irrelevant. Yeah.
Yeah. No, I mean, that would be the interesting thing. Here's the thing, dude. Do you guys bet? I mean, John, you're not even here, so I don't even know how freaking Social Security would work for you. But do you like... I pay Social Security. But do you bet on it? Do you believe that it's going to be there for you?
No goddamn way. Yeah, that's what I thought. Doug, you do understand that in the city of San Francisco, about half to 75% of the AI researchers I know don't contribute to their 401k match. Yes, I know, because they're post... Look, your buddy Trenton doesn't put on sunscreen because... Okay, but AGI... I mean, in 30 years, we're not getting AGI? Come on now. AGI is not happening, man. AGI is not happening. They were talking about AGI in the 80s.
He's really doesn't use sunscreen. That's a youth sunscreen that when you're 20s, you just don't use sunscreen, man. I mean, you might as well smoke cigarettes, too. What happened to our whole bet on yourself Medicare? Hey, hey, hey, you can't tell the kids to smoke cigarettes. Well, no, the thing is, like, you just tax the shit out of cigarettes. When are we going to get to talk about semiconductors again?
when are we going to talk about semiconductors again? Probably when the economy turns, uh, positively. Because it doesn't matter. I mean, dude, reason why I stopped becoming a- I don't write about semiconductors? Demand. Demand is fucked. So what- who gives a shit? Like, guys, 1.5 to 2 times GDP is what historically semiconductors do. That includes up, and that also includes down. Also, ironically, guess what? Every single shortage-
of semiconductors always ends in a glut because there's this giant supply ramp and then like oh there isn't enough capacity there isn't enough capacity there isn't enough capacity then demand sneezes on the other side and then everyone's like holy crap we have too much of it literally that's gb 200 racks right now like i i have utter belief dude 2020 2026 they're gonna be like
microsoft's gonna be like no i can't buy any of this i don't want to pay for anything google is gonna well google doesn't have their own but whatever actually no they'll buy their freaking core reverax oracle will be like bro no i'm going bankrupt i cannot pay for this and then all these guys are actually economically sensitive specifically meta google meta and google as well as amazon and so you know costs go up with tariffs they're
revenue and earnings go down, all of a sudden their free cash flow negative. And they're like, I'm not, I'm going to delay this. The based woke take, right? Is that because of,
The economy gets so fucked in Q2, rates tank, which actually reduces the TCO of any cluster build-out dramatically because now CoreWeave's debt isn't 9%, 10%. It's like 4%. It's 5%. And now the TCO of a cluster build-out, which is debt-fueled, is so cheap and the cost of capital is so much cheaper that we actually get more build-outs.
So here's the thing. Here's the thing. And that's the reason why we're going to own you yet again is the reason why you drop rates is because interest rates go so high. So like think of rates risk as a premium, right? Everything we've seen so far, actually, the 10 year is going up, which is the scariest, spookiest shit of all time. I cannot explain. But it went down for a long time for a month for, for like a month, but it's going up right now. This is the risk off asset to be clear.
As of Monday, April 7th, I think there's a chance that it might go up or it might go down again. But like essentially the biggest fear is that everyone is like, yeah, we're calling BS on your ability to pay for any of this. And so risk premium on the United States government –
Debt goes up because, hey, when this is all done, you're like, bro, this is a banana republic anyways. We might as well charge them. You know, this isn't the risk-free rate anymore. There's clearly risks associated with this. So we might as well charge them 5.5% for risk-free. And then on top of that, there's the high yield spread, right?
Right. That's the other risk premium on top of that high yield spread already starting to blow out. It's like 260 core weaves like another I want to say two turns on that. So like, you know, all of a sudden, oh, no, actually, Corey is like another six turns on that. So all of a sudden in this new world, you're talking about like core weave cost of debt, 15 percent, and then your TCO is tanked.
I mean, like everything that we're seeing in the market is saying like it's totally effed in terms of desire to risk take. Liquidity, dude, I heard the spookiest, the spookiest anecdote of all time.
I don't know if you guys know anything about U.S. treasuries. Essentially, you and I can press a button and move a billion dollars and there's no price slippage at all. It is the most liquid, most intense. Like it is you could move the entire GDP of a small nation in like an afternoon. It is the plumbing of the financial world. Bro, there's bid ask spreads. Liquidity is actually kind of going down in the most liquid market in the world.
Where it's not seizing up, that's good. Because like during the financial crisis, it actually seized up. And that's where it's like really, really, really bad. That's like the worst case. But I'm telling you, risk premium is going up, bro. Like CoreWeave, CoreWeave did the deal of a century because they got out. Like seriously, mad respect. Now at this point in time, you're going to be like CoreWeave getting out is going to be like a gift from heaven essentially in my opinion. But did they actually get out? They're out. They floated, yeah.
yeah but i mean they floated like they raised 1.6 billion that's not a bad dude that's that's that's that's good cash for a little boy like core weave okay i think your brain's your brain's a little broken in terms of the core the open ai raises man no one no you know just think about this it's like hey man i'm gonna raise 1.6 billion dollars in cash it's pretty big that's a pretty big number man 1.6 billion dollars in cash just just drops from the sky didn't exist in liquidity before boom
Do you think AI is like a recession product or a recession-resistant product? I think all recessions accelerate the inevitable, specifically secular things. I think the spookiest and scariest thing, and something that I have to write because I promised Dylan I'd do the hyper-doomer take, is that essentially technology can be massively deflationary, and there's a definite chance that
okay, let's say you're a business cost cutting and you're like, well, can I just do this with an AI? What can I do? Five people's job with like, you know, a pro and some stimulants and with like one person prompting six, you know, six GPTs, six computers are like, you know, doing all kinds of queries all the time. I don't know. Like it's the click farms in Asia or something. It's like, yeah, maybe. And then all of a sudden, you know, the market bounces back and that's like,
pretty, probably semi-permanent demand destruction for labor. So I think there's a real chance that we get unemployment and AI accelerates because it's cost savings and then we get more unemployment. That's the deflationary spiral, baby. And that's... Dylan, what do you think? I mean, I think the flip side is like...
Europe already said they're down to go 0-0. Taiwan said they're down to go 0-0. Vietnam is already... Trump already said they reached a deal with Vietnam. I don't know if that's true, but like, you know... So what if...
It's all fine. You know, there's a little bit of scare. There's a little bit of panic. Global economies tank. All the rich people in all these countries who have a lot of power over their government are like, please, please, sir. Like, you know, and then all of a sudden we have deals with everyone but China. Right. And global economy doesn't melt down entirely. And we're fine. I'll take the under.
I feel like vibes, you just can't, like, unvibe. You can't just, like, open the cat, get cats out of the bag, dude. You're not just gonna be like, yeah, let's back to the old thing.
Vlad's going to be very different after this. He doesn't want this. He literally... He said this so many times. I'm not going to negotiate. We're going to do this way longer. They're semi-permanent. Then all the people around him are like, no, no, no, no, no. It's actually not this. Bestin's like, no, we're opening a negotiation. Dude, reciprocal tariffs are going to hit Thursday. All supply chains are going to freeze up from it. And we're going to go into probably a technical recession on that alone. And then we see what demand is on the other side of that.
My favorite thing is that, or not favorite, but the funny thing is that he's still announcing more tariffs today on like truth social or whatever. Yeah, he said another 50% on China, bro. 140. 140%. So here's the galaxy brain take that I've seen and I quite like it, which is they're going to pass all these tariffs, you know, get like a trillion dollars of windfall and tax or whatever it is, right? I think it's like 900 billion or whatever. No, it's like 400 billion.
Post raise of China? I think that's demand destruction. If it's that high, there won't be trade. There won't be trade, yeah. If you make the number too high... All right, fine. $400 billion, $500 billion, whatever the number is, they have this additional revenue that now the Congressional Budget Office can account for, and then they can pass bills through the CBO process that don't dramatically change...
the deficit, right? And then that's how they then pass whatever retarded ass, you know, 5% corporate income tax or there's no such thing as long short-term capital gains or whatever the hell like crazy stuff they want to do. Um,
And then they can pull back. So the thing that I like don't get is like, where is the industrial support side of this? They do this tariff import substitution. I get it, whatever. But then where is the part where they help build the, where they encourage people to help build these factories? Like we talked about labor earlier, right? Where are those, those measures at all? I don't know. That's the thing is he just likes to do the biggest deal. That's what someone across the, I mean, that's like, I don't know. I don't think there's much industrial support.
made this plan and didn't tell anyone some people would announce really big numbers but i just think i think and i don't know i just dude there's not a plan brother like you guys remember trump one do you guys remember trump one does anyone remember trump one do you think that like i know he has more loyalists but it's like it's trump too it's like the old trump but with new people people are gonna be fired but best since gone by the end of the year so is lutnik like
It's the plan. They don't even talk to each other. Trump 1 was a lot less, let's say, effective in implementing things. Whereas Trump 2 is just out of the gate, fucking laying off people and implementing shit, changing stuff dramatically. They had more congressional support, Trump 2. I love how Steve Mirren, the Council of Economic Advisors guy, he had this clip today where someone asked him, where did you get the equation from? And he goes, well...
Let me just let me actually read this because it was like it was like a hostage video. You know, CEA was involved in a number of calculating a variety means of estimating non-terror barriers. And at the end of the day, the president decided to go with a formula related to closing deficit assists suggested by someone else in the administration. So, like, if you're just going to fucking listen to Peter Navarro, then you're going to listen to Peter Navarro. And we're stuck with Peter Navarro's economy.
The guy who cites himself, Ron Varo. It's an ultimate meme. The man since 2001 has been citing himself, but Ron Varo is actually citing, which is fucking him, just an anagram of his last name. Like, so fucking funny.
We live in the best reality, the best timeline. It's funny until you blow up the entire global economic order and take $3 trillion out of the U.S. economy. I think it's going to be a lot less funny soon next year when people get fired, or this year when people get fired. All right, we can't end on this. Doug, give us a positive energy to take us out on. Deals have to happen quick, like now.
I'm not positive, bro. I'm extremely bearish. I'll be honest with you. I'm just telling you, stocks changed a little fucking sentiment around here. We're not even down 20% on the S&P 500, my friends. Like...
I am reading the Great Depression, and it literally starts the fucking same, guys. A weakening economy, they beg the guy not to pass the tariff. They're like, please, please. A thousand economists say, do not pass these tariffs. They pass the tariffs. They're like, no, it's going to be transitory. No, they're going to build stuff. It's going to be okay. The United States manufacturing base is going to completely...
completely do it and then we just go into a we go into the kindleberg spiral where essentially everyone just trades less with each other goal global trade goes down 60 percent um yeah i don't know what to tell you dude like i don't think it's going to be the great depression because that's unreasonable but do i think it's going to be bad i think it's gonna be much worse than covid i think it's yeah i don't know i think it's gonna be the market rally today or not rally but like
Where did the stocks go? Because if we went down like 3%, this would have been the worst three-day period ever. Pretty much, we already are hitting all-time worsts. The only times that we've had worse are literally like Black Monday, 1987 crash. We're going... I mean, I made this joke already, like make market days historic again, which is mostly like, where's our Black Mondays? Where are we having... So yeah, we pretty much...
pretty much did it dude i mean it's technically extremely oversold like uh one metric of oversold is called rsi i was like 21 honestly it's probably worth a balance if i had to guess and this is like i mean dude i'm post dude i literally post this in a group chat i was like we're gonna open down three and we're probably gonna oh we're probably gonna close flat to up um
Fucking God and then also had a dream Saturday night Which is like pretty messed up that essentially we're gonna open down go up and then go down and every position is gonna go against Me personally that was true. It happened Which is which really sucks, but it was it was a hundred percent true Yeah, I don't know. We probably should bounce like right the fuck now But I think what's gonna happen is we'll bounce today. We'll bounce tomorrow. We might even bounce today
Wednesday as people hope, hope, hope, hope, hope for some kind of deal. And then if no deal is announced, then we're going to crash in features overnight. And then like, that's what happens is like this, there's this, there's this like my favorite phrase in stocks is like, even a dead cat can bounce. Meaning if you like threw a cat out the window and it hit the ground, you're like, there's a little bounce in that.
That's what it is. Yeah, that's... Don't you dare say that about my cat. My cat's never falling out of this apartment, okay? All right. Bouncing dead cats. I think that's what we're going to end it on. Dude, that's like an old... That's like a very hard... It's like a technical phrase. Google it. Dead cat bounce. We need to...
So I guess we're all going to start working. We need to start just doing historical videos of the 30s then. Bro, I'm freaking... I got the book. I got the most famous book. It's like the Diary of the Great Depression. Great. I have so much stuff. I've read two books about tariffs. I'm loading up, dude. I'm going straight back. Dude, you should go look at some... Dude, me too, man. I want to leave on this note because we love history here. And it's like...
So it's like, I mean, what would they even be talking about back then? Probably just stuff we can't relate to. And it's October 28, 1929. And it says leaders insist tariff will pass. And you go into this stuff. Yeah. In August 1929, increase European. We must set the possibility of anti-
antitrust law enforcement, increased European competitive retaliatory tariff measures, declining price levels and limited purchasing power. That's what they were afraid of in August 2029. And that's literally what happened. Like all these newspapers are so freaking creepy because it's literally like identical. It's like it said that there must be a tariff in order to produce revenue to balance the budget. But it has to be pretty clear to be clearly be shown that in order to get the desire to result,
The rate of the duty would have to be up to nearly 50%. Now people are saying these former free traders are now protectionists comforting themselves by saying it's only going to be temporary. It's only going to be temporary, guys. It's going to be to reshore. It's only going to be temporary. Trade is definitely not going to implode. Like...
There's even a team, Nothing Happened, Nothing Ever Happens, in like 125 years ago. They're like, oh, the May Panic of 1901. There's a lot of stuff that's like, it's getting a little too creepy for me because it feels literally like we're just repeating it. Like, it doesn't rhyme. It's literally identical. The timeline is even kind of close. So yeah, I'm going to leave it on an even more bullish note. More happy note. Yeah.
Wait, wait, wait. There's a big difference. Last time, alcohol was legal. This time, alcohol is legal, so the alcohol stocks are going to rally.
You know what's really sad is actually most of the United States... So I already did some work on this. For example, Brown Foreman, probably the largest United States of America, most of their revenue is international. Same with most of our beer companies and stuff like that. So we get tariffed. So essentially, the problem is if there's retaliatory tariffs, they tax us all that stuff. And so, yeah, these companies probably don't... They do rally after they go down 30%. So...
Jesus Christ. Can we talk about something more positive next time? No. I'm doom posting till the end. You know Lama 4 sucked and so the AI trade is over? Lama 4 sucked so much. I keep hearing that it sucked.
Because they have because they what if it's not fucking mog them it's because what if the what if the testing results were in there? We're in the training data all along. No, that's everyone does that stuff. I'm joking. I'm joking everyone trains on test set I it's a good it's a good idea to do so. Yeah, I know it has good data. Yeah, no, I really fucking good data No, he's I'm joking on that. It's like, okay Why are we testing these people who are taking the test with the thing that anyway, sorry, um
No, dude, it seems like it sucks. It's, like, really cringe, too. Have you used it? I used it one time. No, no, that's just the experimental version. The actual open source version is fine. It's not cringe. Okay. Is the experiment... Do they fine-tune it to, like, win the thing? I don't know. They fine-tuned it to win the arena chatbot because who the fuck goes onto the arena chatbot and clicks which one is the best is fucking idiots. And so, of course...
You can fine-tune it to win that and be bad at everything. You just be like, sycophantic or something. You just be like, ooh, you're so smart. Actual, yeah. Based work model. Yeah. It's not as good as Deep Seek. And Deep Seek R2 is going to drop pretty soon. And then Quinn Alibaba is going to have an MOE. It's going to be great. You know, so China's about to mog meta again. When's Anthropic dropping four? When after four? Who knows? Who knows?
04 Mini went 04 Mini went on 3. Yeah, well, this week, this Wednesday, right? I thought that was the open source model.
I don't know. No, no, no. He said 04. He said 04. Does Sam save us from China? And then the market rallies on American AI supremacy. I don't think it's good enough for that, dude. Wait, is this the bit now? Every single transistor radio, I have to come up with a random reason the market's going to rally? Because the market will never rally in our lifetimes again? Thank you. That's...
That's a very bullish statement. So honestly, everyone needs to be as depressed as me. You need to think about this. Like, you know how there's those Taiwan guys who, like, spread fake rumors and they wait until the rumor comes all the way back to them? And they're like, okay, time to do the opposite. That's what I'm doing, okay? I need to come back on this next fucking transistor radio. I need all you guys to be telling me your best 1929 stories. I want to hear 1930. I want to hear month by month.
month for the entire great depression and then we like guys favorite part we saved the economy is that the middle of the country like the iowas and nebraskas they're running through their aquaphor so fast we could have a dust bowl again i'm gonna buy physical gold i literally like i feel like i'm gonna be like it's driving me crazy i hate gold i hate gold investing i hate i think they're the stupidest dumbest fucks of all time and i'm literally like i might become a gold bug i'm like
Dude's about to become Peter Shearer. I'm literally like, I was like, this is a curse. This is a curse. Like, this is like the worst timeline of all of them. Like, you can't do this to me, guys. Like, we'll talk about this later. Anyways, sign up for... Okay, nice talking to you guys. Happy coming to France. Sign up for ProRequests. Yeah, sign up for ProRequests. Patreon. Visionometry Patreon. Yeah. It's a cold, cold place. Detroit's a cold, hard place.
I would go to the poorhouse But Lord, you know I'm ashamed I've been walking hasten street Nobody seems to treat me right I've been walking hasten street Nobody seems to treat me right I can make it in the daytime But life is cold, cold
I'm eating chili, I can't eat beans no more. Yes, I'm eating chili, I can't eat beans no more. People hurt my feelings right from door to door. I've got to leave Detroit if I have to flag number 95.
I'm gonna leave Detroit if I have to flag number 94. And if I ain't never coming to Detroit, no. Somewhere over the rainbow way up there's a land that I heard of once in a lullaby.
Somewhere over the rainbow Skies are dreams that you dare to dream Really do come someday I'll wish upon a star and wake up Where the clouds are far behind Where troubles melt like lemon drops Way above the chimney tops That's where you'll come Over the rainbow You'll burn over the rainbow
Then oh boy can I fly over the rainbow. Over the rainbow I can fly. If happy little bluebirds fly beyond the rainbow I can.