0:04Richard, thanks for doing this. It's a great pleasure and honor to be here. Um, I think of the claim that we went to war with Iran because of its nuclear program as a kind of IQ test. Anyone who repeats that claim has failed the test. As as you've pointed out many times, all wars are engineered. And we're just having a discussion at breakfast that I think is worth recounting for others. Um, so first world war, one of the most momentous events in world history, ended Christian Europe, killed more than 20 million people, wounded another 20 million, just really reordered the globe, and then led to the Second World War. So the United States joined
0:43that war in 1917 toward the end. It had already been going for 3 years. But one of the main reasons the US got into that war is because the sinking of a passenger ship called the Lucatania off the coast of Ireland two years before in 1915 in which 120 odd Americans were killed was sunk by a German yubot. And even at the time there were people who said I don't think this is this is not quite on the level. But now 112 years later, we know a lot more about the sinking of Lucanian. And I wonder if you wouldn't just mind recounting what you said to me this morning at breakfast because it gives us perspective on the effect of propaganda in wartime. Right. Um yes. Yes, I mean
1:29this the sinking was clearly um a key factor in in creating in the media in America anti-German sentiment quite successfully. Um and so yeah, the question is what happened really? Um the way it's presented was well there's a passenger ship with American passengers, you know, just civilians traveling across the Atlantic and sunk by a German submarine. Well, that's like an act of war against America. Yes. Got to do something about this. we're going to declare war on on Germany. Well, that's not that's not a representation of the facts. What really happened was there was this British plan to get America into the war on the British side against Germany which was very
2:15difficult because uh of course actually you know ethnically a majority at the time of Americans were of German origin. Even German speakers still by that time was still German was still widely used as a language in America and and so to get America into war against Germany is a bit of a feat you know to arrange that is it is um so how how did this happen and and that is a good example of the extent to which the the plotters that want war go and it's it's good for people to think about that because of course ordinary people don't want war in any country. Most ordinary people are good people and that creates this problem that they just can't imagine that we're dealing today,
3:04you know, as we look at the world with such dark and evil forces that are intentionally plotting to create a world war or get countries to declare war, you know. Yes. Um so that's why that is true.
3:18People cannot even permit themselves to believe that could be true. Yeah. Yeah. And and that's where studying history is important because we need to know the facts of what happened in the past to understand the present and make some predictions about the future or prepare for what could happen in the future. And the past teaches us that there are some evil elements out there and they're not really um you know they're not people that are representative ordinary people.
3:46the majority of people wouldn't intentionally harm others but we do have such people out there and often in very important and powerful positions. So what happened was step number one uh Britain did this very officially. It listed the Lucitania as an auxiliary um naval military ship and of course the as you can imagine the German Imperial Army and Navy went by the book. I mean that's what one thing Germans are famous for. Um and of course the British knew this. So the moment they would list it on their official list of what are our ships officially declared to be military ships um it was on there as an auxiliary military ship. The Germans would of course target it. Now
4:33when the Germans then saw this German military, oh well hang on, isn't this a passenger ship? Well, you can re uh reuse um you know um of course passenger ships for warfare. So that seems to be what they're doing. But then they realized, oh actually they're taking passengers in. They plan to take passengers in in America. And so partly they sort of half realized well this could be a part of a bigger plot. That's not good and we don't want to sink passengers. On the other hand it was listed there. So that in in many ways they had no choice. What they did then was the German uh military command they put out and the German embassies implemented in America.
5:15They put out ads into American newspapers stating and they, you know, we have copies of these ads, uh, warning people, don't board the Lucitania. It is listed as a military auxiliary ship. It is on our target list with the German government put ads in American newspapers telling Americans not to board the Lucatania because they might sink it. Exactly. Indeed. Indeed. That's incredible.
5:39And and it turns out that in in some cities, the big newspapers refused to carry these ads because they were clearly controlled by people that had the same views as the British side in this war and wanted America to join the war. So the ads weren't always published uh successfully everywhere, but quite a few were published. So that's the situation. Despite that, there were passengers on board. No doubt some efforts were made to make sure certain groups, you know, you would have some people on there for sure. Maybe you pay them to board even, who knows?
6:15You know, we don't know these details. We know the facts that there were passengers, American passengers on board, American citizens. And the Germans had warned, we're going to sink this. And um it's not quite clear whether there was actually military equipment on there. there seemed to be the indication that there was because and I you can imagine that the goal was really to make sure that the the Germans will sink it. So the best way then is to actually have military equipment on there and you know have some visibility when it's in the dock and some something is loaded and we do have some indication that this happening. Of course later this was denied. Um but there's
6:54also uh you know various people looking at at the the sunken wreck. Um and still it's basically there is a good chance that there was military ammunition and and other equipment on there. Now so that's one thing. The other thing is well how would the captain of the ship handle this? Um as you know as he crosses with his passengers and potentially military load and of course he must have been aware that it's listed as an auxiliary military ship uh as he crosses the Atlantic. Well, the British at that time had actually broken the the secret code for encryption that the German military was using, the Enigma code, and they therefore could read the messages between um
7:42the Yubot submarines and headquarters and so on, which of course is another indication that okay, um you know, this this could not really have been such a big surprise uh to Britain. And something like this of course must have been the reason why the captain of the ship uh of the Lucitania was happy to go because you know of course he has to trust his his admiral t and his um you know um his country's leadership. They said no you'll be fine. We make sure you'll be fine. We we know where the Ubots are, the Germans are and we'll we'll we'll guide you on the track that uh will keep you safe. So they guided him as it turns out straight into one of those German submarines.
8:27Um but the captain didn't know. He was told this is the safe path. Now where I'm sure he started to become suspicious was when the order was suddenly then given in the vicinity or about to approach the vicinity of a German submarine to slow down the engines because that never makes sense. And there's a good BBC documentary on this where they didn't hide the facts and they have the first lord of the admiral te as the key figure. Who was that? None other than Winston Churchill. And they show how he gives the order. Now instruct the captain to slow down the engines and even his underlings saying well sir um you know this sort of increases the risk. Should we really do that? This is my
9:12order. Give the order. And that's what they did. They slowed down the Lucitania. And of course, it was unavoidable. Then the Yubot, they saw them. It's on the list. They have to follow the orders.
9:25And they sank it. And then, of course, the next day you had all these headlines, you know, these um you know, the Huns, the butchers had it again, as the Germans were described in the British First World War propaganda. And it it was an important factor in getting America into war. So, so basically it was a false flag and that has been um a key mechanism to start or you know get countries to join a world war. It's not the only incidents but it shows you the devious nature of the plotters and that's what we have to be aware of today in this day and age as we are unfortunately on the brink of a third world war. Again, most people think surely third world nobody
10:05wants a world war. Well, ordinary people don't and I don't want it and you don't want it. No, but there are people out there who really doing everything to get there and a false flag is likely to be the beginning of this. Um, you know, as we talk about peace, as we have peace negotiations, just one vicious and successful cunning false flag and then magnified with false information by the media is unfortunately still enough. Spring is the most refreshing time of year. Nothing compliments it better than black rifle coffee. lots of it. This is an American company founded by veterans with conviction. They built the whole thing around a simple idea. Do it right or just don't do it.
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11:22on Amazon or go right to black rifle coffee.com to stock up from the source. Black Rifle Coffee, veteran founded, American roasted, still standing, still brewing of I mean 9/11, the details of which are still classified for reasons no one will explain. No one's attempting to declassify it, which tells you everything, led to 20 years of war and the deaths of millions. Yeah. Now, actually on this topic, I think there is there is the other important parallel. you know, we we we've been seeing this this war on Iran by the US and Israel. And of course, it has major economic consequences, dire consequences. This something we can we can talk about,
12:04but also this is another reason why we should look back at this era of the first world war and how we got into this because it was the first great war. It was, you know, in Britain, it's still called the great war where you had full mobilization of entire countries. You know, previously you would never mobilize the entire country. Of course not. Even civilians, even you know, housewives were mobilized to do factory work or other support work, uh, hospital work, all sorts. Um, and and so it was really the the beginning of this modern era where you have totalitarian control unleashed under the cover of a great war. And of course that's a scenario we have to be very much aware
12:47of as as we speak you know there's there's uh preparations for mobilization in Germany draft um military service um you know all the rules being revamped and tightened and the the plan clearly is to draft more people into the military. It's official EU policy to have a huge rearmament drive to get ready for war. And they talk about dates and that tells you that I mean they're planning for a war. I mean that's it's not a secret. They're saying we're planning for a war against the great powers Russia. They don't mention China but of course you know they're allies um whether not perhaps not formally in a military way but de facto allies. China is there. So and that's that's
13:34official EU policy to have this war 20 um 28 29 2030 other dates that are being mentioned. we have to be ready by that time for a world war um or a war against Russia which would be a world war. So, so what's going on here? And I think that what we've seen this year has been clearly quite dramatic. First Venezuela dramatic events although in a way on the larger scale sort of you know quickly done somewhat contained it seems but quite a remarkable event because before of course for decades US intervention in Latin America took the form of covert operations which always run under the principle it's a very British principle of uh plausible deniability Well, we didn't do that. Oh,
14:29this this poor president get assassinated of this country. It's nothing to do with us, right? This is how it's been working for decades in Latin America. You know, you can list the countries, just country after country, regime change operations by the CIA, uh, in fairly brutal ways and then getting regimes into power that are, you know, essentially puppet regimes run by the CIA, um, presidents, prime ministers assassinated and so on. But always, oh, it wasn't as denied.
14:58Although, you know, we do have um whistleblowers like uh Fletcher Prrowy and his great book, The Secret Team, which tells you a lot about how the CIA became so powerful, totally out of bounds and out of control, beyond its legal powers. You know, it's been active beyond its legal powers for decades. He he also describes how they did this very simply. the um um basically the institution that's supposed to reign in the CIA. They exist formally. It's the the committees um in in the Senate and Congress, you know, there's committees, the House Intelligence Committees and Senate intelligence. Exactly. And and that's ultimately what's supposed to provide these checks and
15:42balances on on the secret services, including of course the CIA. But as Fletcher Prrowy explains, you know, once the law was passed that it's a criminal to reveal whether somebody works for the CIA or not and that was passed and so now it's a secret who's at the CIA or not. Um and and then also it was accepted that when you are uh a congressman, a member of Senate and you are a member of these committees, you don't have to disclose that potentially huge conflict of interest. Obviously, at that moment, you're in charge of the country because you make sure, and that's what the CIA did, that all the um the committee members who supposed to oversee the CA
16:34are all CIA agents and then there's no more checks and balances. You've got the rule by the CA, and that's seems to be what happens. Now, the book by Fletcher Prrowy was unavailable for for 20 years.
16:47He wrote it in the 70s. Who was he? He of course had worked for the CIA. He was a top guy at the CIA. At the end, I think his highest position was uh head of covert operations at the Joint Chiefs of Staff in the White House. He's the one who was sent to Antarctica when JFK was assassinated because deep down he was always a good guy and he wouldn't be involved in assassinating the presidents and his colleagues knew that. So he was sent to, you know, far away as far as he as you as you could. And when he returned, he quickly found out, oh, it was the CIA and he started to be a whistleblower and the book was then unavailable for decades, but with the rise of the internet in
17:29the '90s, late '9s, of course, it's now available again. Um, so um, you know, that that that shows how how these things work. So that's the background. But now Venezuela, um, what was that?
17:42What was that? What was the point of that? The Well, there's there's several points, but in terms of the the method, the the big difference was there's no plausible deniability. No, actually, it's official. We're going to officially move in there and arrange regime change in a sovereign country. So, in other words, America is now at the stage where there's no longer felt to be a need to deny that America is doing these things and has been doing these things. Well, now we doing the we don't need a color revolution. pretend there was a popular uprising. We just we want this guy to be in power or we don't want this guy to be well, we're going to intervene and do it. So, no
18:19more um reference to the nicities of international law and and ethical behavior. Not necessary. So, that's an important turning point. But of course, the the other implications are and then that's where we we move on to Iran and beyond. Why Venezuela? Well, it's the biggest um well, it has the biggest oil resources. Of course, there's a there's a more detailed story. I mean, it's it's it's a particular type of of crude oil, very heavy one. You need particularly refineries to do that. Uh it's not a a cheap and easy process. So, it's not the economically the best oil, but it's the biggest volume. Okay. So, that is something. And by the way,
19:04who's been refining most Venezuelan oil and has built up um a huge array of refineries is China.
19:13And that is an important indication of where all this is heading. So that was step one, Venezuela.
19:20Step two, well, who else is a big oil producer and source of oil and energy um for China is Iran.
19:32So now Iran is under attack. War is made on Iran and of course we have the the economic fallout uh that um other countries will suffer as trade through the straight of Hormuz is severely limited restricted. It's not fully 100% embargoed. You know that ships are getting through but clearly not the majority. And it has had an impact and of course it's not just um oil um but also other things are delivered you know fertilizer um a lot of the u middle eastern countries are the world some of the world's largest producers of fertilizer um for the world even for the US you know delivering to the US to Europe um to to many countries and of course
20:18that has also been severely the shipping of those has been restricted that'll have consequences next year that's not immediate it's for the next you know growing season uh because you know there's stocks and so on. So uh for this the whole point of keeping a gun at home for self-defense is to defend yourself and your family especially when you're not expecting a threat. You don't know when the threat may arise. You have to be able to get to your firearm quickly but prevent other people from getting it illicitly. Well, Stopbox Pro is the answer. So storing your firearm used to be a huge problem. and you had to put it somewhere far away that was hard to get to or you had to
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21:40Visit stopboxusa.com. Use the code Tucker for 10% off your whole order. After your purchase, Stobox will ask you where you heard about them. feel free to mention us. But do you see Venezuela and Iran as connected in that both of those conflicts are aimed at China? Indeed. Yeah, that's that's that's exactly it. And and that's where now I think it's it's good to go back again to the the runup to the First World War. What was the situation? It was a situation where we had one global hegeimon Britain running the world. Half the world was formerly part of the British Empire. Of course, not acquired through free and open elections, was it? No. So, military force um at at times extremely
22:26brutal uh colonial suppression for quite a long time um the greater part in in in the subcontinent in India uh run by a for-profit enterprise, the East India Company. So, you had colonialism run by a for-profit enterprise. It's not a good idea. It's not very nice for people. The estimates vary of how many million Indians were killed under this rule by a for-profit company being in charge of a you know of of of um you know millions and millions of people. Um and and actually the the the ruling elite in the East India Company always had this view well it's too many Indians. We don't really need that many Indians. Horrible views um out there. Too many useless eaters. This is where
23:14by the way this whole overpopulation agenda that I'd like to talk to you about um came from. It goes back to the East India Company uh because Malus who is this famous you know um economist talking about overpopulation. Yes, he literally worked for the East India Company and it's known and there's many quotes of the East India Company people saying there's too many people you know we don't need all these these Indians but anyway we'll come back to that.
23:44So that's the picture of the world. So Britain, half the world directly under British control in a uh colonial regime that clearly benefit Britain, not the colonial subjects. Um to the same extent many suffered and many died that includes actually of course um you know one of the first colonies of Britain was Ireland and you know there's the the great Irish famine, the potato famine.
24:11Well, did you know that during the potato famine, Ireland produced potatoes and exported potatoes?
24:17Exported potatoes to England while Irish people were starving. So, it wasn't a lack of potatoes.
24:24It was policies that result in this famine. But anyway, there were too many Irish people.
24:30We have documents of British leaders saying that there all these Irish people. We don't need so many Irish people. So, this is the background. Okay. So, Britain in charge of the world. Now we had this development earlier on um of a new economic power and political power in Europe, Prussia. Prussia was the first modern high growth economy and it was quite breathtaking. Um it was high growth and prosperity for the majority of the people. It was capitalism but it was capitalism for a kind where the idea was well we want it to be sustainable capitalism in the sense that we don't want to have mass poverty at the same time. We don't want this K-shaped economy where the
25:17elite is doing really well but the majority of the people are not doing well. That's and I think it's perfectly rational to say that that's not really a great system because you're storing up trouble for the future. Right. Yes. you know, if the majority is actually not benefiting and it is a, you know, and you have increasingly democratic structures, then at some stage something will change, right? Yes. Um, so you want to avoid it and they did it very early on. So the first modern um u sort of social security legislation was done in Prussia also. Of course, the first investment in public schools, properly public schools and kindergartens and universities was in Prussia.
25:59It was a very modern state, highly successful. The middle class was thriving. It was merit-based. You could move up the ladder. Um, if you put in your energy and your efforts, it will be rewarded. Very successful economy based of course also on the system of decentralization, local decision-m and especially many small local banks lending to small firms.
26:22Now Prussia then morphed into um into uh Germany in in 1871. Yes. The unification which is another um or partial unification because of course many German states were left out such as Austria. Yeah.
26:39Um under international um sort of um influence but also Prussia felt Austria was a rival and and so on. I mean there's there that's for another show. There's there's a lot of interesting stuff happening there. Um but the principles were also applied in now Imperial Germany under essentially Prussian leadership and again Imperial Germany was highly successful. Um economic growth um just in the the beginning of the 20th century was very high. It was a high growth economy again and people benefited prosperity the middle class uh it was um quite impressive.
27:20the city's beautiful massive public investment, railway network, schools, universities, science, you know, this is the beginning of science being German dominated. Um, in the first half of the 20th century, the majority of scientific publications were in German and all the leading research was was was in these these publications. That was where things were happening and other countries were were following were looking at this model. Now the place that didn't like that was the hegeimon of the world Britain that clearly was to from their viewpoint rivalry a rival being um built up and growing and um it is one thing to start to lose market share because Britain used
28:06to be the number one economic power industrial revolution and you know mass production really happened first in Britain and then spread from there um to other countries. So Britain was in the sequence chronology of economic development was number one but then soon after Germany came and of course also at the same time America also rose um as a emerging economy high growth economy as well let's not forget that so but of course America is further away and was for international documents using English so I suppose the British felt less immediately threatened by America Germany is very and um the decision was made, we've got to do something about this. But a key turning point
28:52in this in in really resolving the um the British goals uh and and and and creating this conviction that war has to be made on Germany was the following development.
29:05So British power was projected across the globe through through the seas, the oceans, the navy because it was a global empire, you know, from Britain to Australia and and you know, many parts of the world, shipping was of course very important and control of the seas was important and that was it was in British hands. So no doubt about that. Nobody could even come close to um the numbers of ships and and British naval dominance. But then something else happened um that was felt as is a huge threat. Germany developed this plan in working on the continent is a continental power and we have this conflict between a sort of sea power and the continental power. Now Germany
29:51made plans to I mean it's quite natural to improve its access to resources. You know Germany didn't really have many resources. It has coal um for the steel industry, you know, it has it had some input, but it still needed other raw materials and inputs from from across the globe. So, how do you get that? If it's via the seas, then essentially it's beholden to the British, can be blackmailed by the British as actually happened, demonstrated in 1919. You know, the first world war in Germany was over in 1918 when the armisters was signed and Germany I mean German leaders have always been slightly on the naive side believing okay that's an armistice that's that the first world wars
30:40ended Germany wasn't defeated no foreign troops on German territory yet and and it it disbanded its army and its navy right but the British of course didn't disband their army and navy and they staged a naval blockade of Germany. Suddenly, shipping was entirely cut off. Uh, as a result, 1 million, it's estimated around 1 million Germans starve to death in the famine of 1919, which was engineered by the British. Just to illustrate the reality when you're beholden to a sea power that controls the seas for your inputs. And so, on the one hand, Germany had been aware of that risk and it was working on alternatives. And on the other hand, Britain had adopted countermeasures,
31:24war countermeasures. So around a million Germans started to death. Yeah. In 1919. And of course, Britain continued to fight in in on British senotars of the first world war often in the countryside. You see the the first world war um defined as 1914 to 1919 because you know dead bodies were still arriving the villages. You couldn't tell the uh the pastor no right 1918 on the senado. Well, we were still at you know our fallen coming you know and then the villages recording the the deaths in 1919. So um now this what what really um changed things was around 1900 the German plan to improve its raw material resource access to
32:14avoid these issues that unfortunately could not be in the end avoided but not to be beholden. it was trying not to be uh in a situation where it's blackmailed by Britain um through the seas namely to have a continental transport system and this plan was um developed by um on the investment side and the engineering side Seammens major German engineering company and funded by Deutsche Bank namely the plan to build the Berlin Baghdad Bazra railway well here's some pretty awful statist statistic over 85% of the so-called grass-fed beef sold in this country comes from other countries.
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33:43The code is tucker. That's free meat with every order and a hundred bucks off your first three orders when you start your subscription plan this month. Or if you just want to try it out, you can get $40 off your first order with the code Tucker. Good ranchers.com. American meat delivered to you via Istanbul. Ottoman Empire was already a um an ally and so it's quite natural to gain access to um the Gulf area and oil which was beginning to be you know clearly an important resource and so they started building that railway the Berlin Baghdad Basra railway that's when the British colonial and empire planners decided this really has to be stopped because had that been built in time
34:31completed then it would have rendered essentially the British naval dominance irrelevant because you can transport um energy resources, raw materials, you can sell your high value added output u to actually the British Empire, Middle East or or India um to the rest of the world. You can ship through your own railway network without British interference. Um so the the British planners decided this cannot be allowed. This has to be stopped by all means including war and it was a key factor in the runup to the first world war. Of course there were other factors. Um the German government became increasingly internationally critical of British um warfare across the
35:20globe. For example, um you know, in in in South Africa, yes. Um Britain made war on the farmers, the German and low country Dutch farmers that had settled centuries earlier in South Africa, created the world's first concentration camps. Indeed. Indeed. That was a British invention. Um there were three farmer wars. Farmer Bower in German in Dutch. Ba ba. Um the three ba wars.
35:48the farmer wars because literally the world's number one uh military power made war on farmers to control this country, this area. Why? Well, it was of strategic relevance but also oil uh sorry not um other resources, gold and diamonds were found there and um London was very keen to to have those. Um actually surprisingly the farmers were so well organized. They won the first farmers war and the second boa war and then they had to use Britain had to use their usual devious techniques um to win the third one murdering women and children in concentration camps. Yes. And so and and the Kaiser the German um leadership criticized the British intervention and and so Britain also
36:36I mean these are other reasons that what future British prime minister fought in that war. Yes.
36:40Well, Churchill had a had a role there and writes about it in his I think he even got captured. He did get captured and was treated well um enough to to escape alive which wasn't really true for for people in the concentration camps necessarily. So yes now so there were other factors no doubt but uh it's clear when you look at the the old documents that anti-German sentiments whipped up um as soon as there were early plans for this railway. It didn't come from nowhere. It was discussed already in the 18 um late 1880s 1890s and then became a proper investment project at the at the end of the the 19th century and and you know 1900s um onwards and of course the first
37:23world war succeeded in stopping that. Now also just another point before we look at what this means for today. What are the lessons for today? The first world war itself was of course quite devastating for Germany um also for all the other countries involved. Uh the number of of people killed in the war I it's just horrendous huge waste of um yeah of lives and and resources very very sad. Also Germany then in the Versail treaty after the starvation of 1919 this is meant to soften up Germany and then impose the Versail you know um strange rules on Germany. the Germany would be taken apart. One quarter of Germany would be lost and given to other countries. Lots
38:09of Germans, millions of Germans would now live in new countries newly created by the British such as Czechoslovakia and so on. And and so you know this a lot of hardship followed this.
38:20Despite that they couldn't essentially change the fact that Germany was still scientifically leader engineering in terms of engineering and and u production was a leader in the world and was still a rival of of Britain um because the education system also hadn't really been destroyed and so you know a second round was needed another world war was needed and for this interestingly a lot of investment took place in Germany in the 1920s that allowed a quick revival and of course there's other issues how Hitler came to power. If we have time we should talk about how did he actually come to power when you look at money and banking and central banking you get some interesting new
39:03insights. So we also had investment in in Germany particularly by America American companies ITT, General Motors, Ford and then also banking Brown Brothers Haramman where Prescott Scott was uh from the uh uh sorry Prescott um Bush from the Bush family was was active supporting Germany. Um now something very similar is happening or has been happening in in recent decades. Of course the the postc world war global hegeimon is America. It's taken on that leadership role from Britain originally even with its own colonies. I mean there been American colonies whether Philippines or other places. Um and it's adopted the key policies and policy tools from Britain. So
39:55which country is the new Germany that is arrival to America? Well, it's China. And China has been um working on ensuring its uh supply of raw material inputs in the last particularly in the last 15 years. So in many ways it's a sort of new strategy but it is very much the same situation as Germany was in. It it didn't want to be beholdened to shipping uh under British control could be blackmailed. Of course, America is dominating the seas and China doesn't want to be beholden to America and that includes, of course, the straight of Homus. Uh it also includes the straight of Malaka where even more Chinese trade goes through. That's another of these potential choke points
40:42as they call it where they can choke China. So, China's been working on alternative routes. The what is the modern Berlin Baghdad railway? Well, it is the belt and road initiative which is the Chinese president Xi Jinping's um really landmark um milestone foreign policy initiative started um 11 years ago. On the one hand, it offers an interesting alternative to participating countries, many developing countries to the IMF World Bank system that I hope we have we have time to discuss because that system has been designed to keep developing countries from developing to prevent development and to keep them poor but effective cheap exporters of raw materials
41:37according to the British colonial model. It's like the modern version of the colonial British Empire is this American dominated IMF World Bank rule and the above and road initiative on the one hand is an is alternative that can be offered to countries and many countries including in Africa have joined this for this reason. Can you describe what it is for people who don't know yes about Bel and Road?
42:00Yes. So um the there's actually many different names for this. Uh at one stage was called the the the one belt initiative then belt and road initiative. Uh sometimes it's called the silk the modern silk road the new silk road. It is about um on the one hand logistics to ensure stable um effective u supply routes between China and um the rest of the world to a large extent on the continent but not entirely. There's also shipping belt and road um across the seas. Um and it's also a way for China to switch out of the dollar. So it is linked to the Nixon shock what happened there um you know the dollar becoming the petro dollar in the years afterwards under Henry Kissinger's
42:54um interventions the petro dollar Saudi Arabia being essentially made part of the United States uh only selling dollar uh as I say oil against the dollar but also reinvesting 80% of its foreign exchange reserves in US treasuries um that petro dollar system is increasingly being challenged by other countries and of course by China the BRICS countries and the Beldon road initiative is a counterparty to that um and likewise you know counterparty to this IMF world bank system which is really the the continuation of the bread and wood system which is the dollar dominant system um so China had this problem beforehand that you know as as a successful exporter it's earning foreign
43:38exchange but mostly it's earning dollars what to do with the dollars and of course it was investing like at the time most countries in US treasuries which suited America fine but China decided um sort of 15 years ago well we need an alternative to this we can't keep investing US treasuries because and very few people know this when other countries buy US treasuries all they're actually getting is a promise on a promise because you know treasury is is an IOU is a promise right but do you know that China doesn't even get those promises. The US Treasury issues government bonds, Treasury bonds, but China doesn't get those. Why? Well, there's a rule that they're held by
44:26the Federal Reserve Bank of New York in custody for foreign governments. So it's a promise on a promise so that you know China can't go with these papers and and sell them somewhere without permission of US entities the the Federal Reserve. Now some may say well that's just a technicality that's not an issue. Well, we've seen that in reality this can be very very important. For example, in the so-called Asian crisis 9798 1997 1998 um which was very much engineered by the um by the system IMF and and central banks. It's very much um you know I I was sent as on an official mission to Thailand in 1998 on this to analyze this and advise the Thai government from
45:13the Asian development bank's perspective. Um based on my analysis I concluded that it was a plot by the local central bank in Thailand against the country together with the IMF.
45:26Um it was a situation to create um you know a boom bust cycle and then bankrupt Thailand and ask the IMF to come in and then the IMF asked for Thai assets to be sold to foreigners. You know Thailand was doing well until then. Um and then it had to sell well it was asked to sell its banks and its industry to to foreigners very cheaply while the currency had been devalued. Right?
45:51you know, just looking at the the big picture outcome, that's that's um what he was meant to be about. The mechanism is also quite interesting. It's the same mechanism they put on onto Germany in the early 1930s to get Hitler into power. Um you know, Thailand had a savings surplus. It had um you know, successful exports um and was a reasonably high growth economy, but it was brought down very badly. um in in this uh in this setup and this started with the central bank. the central bank saying okay well we'll have a fixed exchange rate against the dollar everything's safe never worry about the exchange rate we can we have foreign currency reserves we can maintain
46:34this taibart dollar exchange rate and at the same time as I could show in my work on this um they uh raised the domestic interest rate above the dollar interest rate and allowed companies you know current account uh open um deregulated allowed companies to raise money in dollars. Well, if there's a fixed exchange rate and the dollar interest rate is lower than the domestic interest rate, they're basically the Thai center was telling Thai companies, "Borrow in dollars, please," which doesn't make sense. It's not a good idea. Even short-term borrowing in dollars was increased by the central bank in this setup. Um and then all you need as as then foreign debt
47:19increases and increased increased all you need is a bit of a set setback in economic growth in exports for example foreign exchange reserve going down a bit international investors this is not sustainable building up this uh this debt pile for no good reason and that's what happens then of course speculators attacked the Thai bot um and the central bank defended the bot which meant it was selling foreign exchange reserves selling dollars buying the bot Of course, the dollar pile went smaller and smaller until you run out. They defended the B, they said, until the last dollar and then what? Well, then the B collapses and this is what happened. Um, so it was a crazy strategy.
48:02I also found out that during the same time the central bank even imposed loan growth quotas. You know this is the window guidance central bank um informal guidance of bank credit which when used properly is is part of the high growth system. You can make sure that bank credit goes to productive business investment leads to growth. But you can also use it for bad things as I show in my book princes of the yen. The Bank of Japan used this mechanism to force banks to increase real estate speculative loans, create a real estate bubble which you can use to bust the system. And and so the this credit guidance system was also used by the Thai central bank to exacerbate this um this
48:46crisis or this uh impending crisis. And then once the crisis happened, everyone, oh we need the IMF to come in. And what did the IMF demand? Well, you have to restrict credit creation now.
48:57You have to tighten everything up um and restrict fiscal policy. Everything has to be restricted.
49:03So recession get a huge recession um industrial output collapsed by 25%. The Thai bot now without foreign exchange reserves just fell and fell. Thailand became very cheap and the IMF demands well help you. But there's conditionality. You have to now sell your assets to to foreign strategic partners. I advise them don't do that. Get out of the IMF program. here's how you can get back on your feet. Um it took them maybe two years but then they took the advice and they ended the IMF program because it was it was clearly um a system to take down Yeah. It's a control mechanism to take the Yeah. take the country down. So um the belt and road initiative offered and and
49:46continues to offer alternatives to this fairly um you know predatory predatory. This is the word I was looking for. Um, system run via the IMF and the World Bank and and other institutions that has not helped developing countries. And so many countries saying, well, let's try that.
50:08At the same time, it offered China the possibility to diversify its dollar reserves because as part of this initiative, it would give money to other countries but um for particular projects that build up infrastructure and therefore also helps these countries. So, China has spent billions on building really shiny new roads and highways and bridges and railway connections, transport, ports, massive investments in ports. Um and of course you know all these receiver countries I've been to some they're very proud of this and they look really impressive projects um modern and helping the country and the countries can use this for their own economic development. Excuse me. And so
50:54um it's been attractive and many countries have joined although of course also counter measures have been started and some countries were put under pressure to drop out again.
51:04It wasn't popular when Italy wanted to sign up or Hungary wanted to sign up with this and they were put under pressure by the EU and US um parties as well. But it's been quite successful and and so of course a key strategic partner has always been um Iran as a oil supplier to China and we can tell that the war on Iran is part of the this counter measure that's um that's really in operation against China because in in these bombing campaigns against Iran what was also bombed were belt and road infrastructure uh projects, bridges, um railway connections and um and other parts of this um supply structure. And so, you know, why would America do that? Well, it is to get in the
52:02way of the the modern Berlin Baghdad railway. Um so, goes up through Central Asia. Yes, of course.
52:11It's it's you know the the the modern silk road. There's many many silk roads of course there's one via Russia further north and further south there several um and it's the similar viewpoint I mean there's there's actually a British theoretician Mckinda who talked about this heartland theory that whoever controls Eurasia controls the world and that's really why Britain first was very keen to prevent Germany from collaborating with countries further east um Ottoman Empire Russia in particular and also prevent the the buildup of um transport infrastructure that of course fosters closer economic and political connections and it's the same of course America has has adopted
52:55that strategy um there's a there's a famous quote by uh what's his name Stratfor Freriedman um saying that you know the the key goal in the 20th century has been to prevent Germany from collaborating with Russia Um and America has also pursued that and very successfully you know Germany is not collaborating with Russia even though it would be both countries interests to put it mildly. Yeah. Exactly. And and likewise in Asia of course the equivalent that he didn't mention that but I think I would add that uh it's been a key goal of America to prevent Japan and China from collaborating. Yes. Because if they did you know who needs America in the Pacific? So,
53:38of course, America has always been telling the Japanese, "Oh, don't trust the Chinese, you know, they hate you." And it's been telling China, "Oh, don't trust the Japanese. They hate you."
53:46And I don't think the Chinese trust the Japanese for other reasons, too. I think actually the two countries get along better than people recognize. And it's not just the Taiwanese population that is has very favorable memories of being part of Japan until 1945. And most Taiwanese people I know speak always very fondly of Japan. It's also Chinese youth. They think Japan is a cool, fun place and quite exciting. Um and of course there is a whole generation uh Deng Xiaoing's generation of Chinese leaders who know the great things Japan did for China because when he traveled to Japan to seek the secret of high economic growth you know when Deng Xiaoing came to power he asked
54:34the Japanese for that and the Japanese didn't have to tell him but they did. Not just that, they sent their key guy who was a high growth 1960s high growth planner uh to to China and he came with you know another 11 12 people top planners and they did the Chinese high growth system for Deng Xiaoing together with the uh you know 300 top Chinese colleagues. So Japan did some great things for China. China wouldn't be where it is today without the help of Japan. And that's you know and of course people know this on both sides. So I think the two countries actually get along better than people realize. It's just not politically correct to mention that uh because
55:16it's not supposed to be like this. Yes. So this is really the context in which we have to see what's happening with this war on Iran. I think ultimately the goal is China because unfortunately America has or key decision makers let's say it's not ordinary American people obviously what we're talking about here but some key decision makers in America influential people that influence American policy have decided that there should be antagonism between America and China there's all these you know military strategic plans and China is in these military plans described as a key threat even more important than Russia which explains some of the um unfriendly policies
56:05towards China in the past and it is a parallel development because China you know when you look back at the British colonial rule and then Germany rising Germany was identified as the threat and then measures were taken including a world war, a second world war, which shows you the extent to which these planners would go, China seems to be the modern equivalent. It clearly is a challenge economically to America. But if we only think in economic terms, it's not really something to worry about because economics is about embracing this and competition is fine, is a good thing.
56:46And if you have the right economic policies, America can really thrive on working with China as partly happened in the past. Um, but you see also there's something sinister going on because it wasn't really necessary for America to transfer most of the manufacturing to China in the first place. This reminds me of the American investment in Germany in the 1920s and 30s, right? Of course, massive American investment has taken place in China and technology has been transferred to China when it was needed and helpful. Now, in many ways, you know, there's not many areas left where China needs foreign technology because it's very much ahead of the game in a lot of them. Not all, but
57:30you know, in quite a lot. But clearly, that was very important. So, why did this happen? I think it's the same reason why it happened in Germany. you know, you need if you're planning for world war, you also need to make sure the opponent is built up first to have a proper war. Um, and um, that tells you about the sort of the goals that are at play here. Do you really think so? It looks like it. I mean, you know, I'm always reluctant to come to these conclusions, but, you know, it was a bit much, wasn't it? the American investment in China, shifting all this production to China for short-term profit, you know, oh, you've got higher margins if we do it that way. Well,
58:08you're losing all these jobs. You're creating all these problems for America, for ordinary people, for the middle class, for the country, and the for the long term. Why are you doing this? Well, some people were aware of this and still were part of this thrust. Um, and it wasn't slowed down. So, it, you know, it was intentional, but it was unnecessary. it wasn't really necessary to do this. So there were considerations to make sure China would be built up. Um and uh that actually you may be getting back to what you said at the outset about you know a small percentage of the population has goals that are incomprehensible to normal people because they're so evil. Right.
58:47And and China is actually an interesting case study to come to that conclusion too.
58:53If we look at the earlier phase of Chinese postwar development when Mao was in charge, yes, it was more or less a dictatorship. It was a communist more oralist dictatorship and Mao took a very um unpleasant policies clearly and a lot of people died. Now there's always this historians view that oh when people died that was clearly wasn't intentional. Um, but some facts about this are very disturbing. First of all, let's not forget that Mao indisputably was put in power by foreign interests. That's not even denied. Yeah. Well, what what does Russian mean? I mean, um, it was certainly Soviet and perhaps Bolevik would would come closer to it because you see a direct
59:44um lineage there of if you look at the individuals. Yes. Go back to they go back to the sort of Bolevik movement. which you could even call anti-Russian at some stage. I mean, it was clearly murdered a lot of Russians. So, yeah, it's fair and and so there is that link. Um, so he was put in in place by foreign uh interests on the one hand and at the same time then you look at the policies he took and I want to focus I mean there are many crazy policies like cultural revolution which in many way ways is being replayed nowadays. You know, this this cultural Marxism is is a cultural revolution where you you mess with people's heads. It's like a scop. You
60:24know, red is not red and black is not black. You know, you have to denounce yourself and denounce the facts and and you know, declare untruths to be true sort of thing. A man is not a man. What is a woman? You know, doesn't this sound familiar? It does. Um that's that that was also a big operation so-called cultural revolution. And then we had this great leap forward which is economically a great leap backward. And then we had this famine which is quite a mysterious thing. So I want to just briefly talk about this famine and it's relevant for us today because again ordinary people think oh we couldn't have leaders who plan horrible things for us that wouldn't happen. You
61:05know they wouldn't intentionally do it. They have good intentions. They don't want they wouldn't never want to starve 80 million people to death would they? Well here's the counter case. Here's a case where 80 million people were starved to death. It was covered up for a long time and the numbers the more research been done have been going up and up and up. We're around 80 million now. First of all, 2 million, 10 million, 15 million. It got higher and higher and it seems to be in this order which is phenomenal. I mean this is really very very sad and very tragic.
61:36What happened? What is this famine in China? It started in a year when there was a bumper crop.
61:46So good harvest. Now if you want to engineer a famine is not the great starting point. And but because it happened at this point, it makes clearer that it was an intentional starvation of a of millions of people because you had to take a particular combination of very specific policies to get this disastrous outcome. And they're all policies. There's actually no doubt, no historian says it wasn't policies that led to this famine. They just all whether western or Chinese historians they all say well but sure it was a mistake they didn't intend this well when it's such a very specific combination of highly unusual policies which are however are necessary
62:36to have this outcome of a famine then you really have to wonder you know and it wasn't under duress they were freely taken so there is no doubt that it was a policyinduced outcome is the debate is was it intentional or not? Well, I I'll give you some of the ingredients of this famine. So, if you want to start a famine when you have bumper crops, you got to do some things. I mean, um otherwise there won't be a famine. For example, what what can you do? Think about it. What can you do? Um well, we could we could um actually pass some laws that round up all the harvest workers and transport them from the rural areas to the cities. So, let's do that. Well, that's what they
63:22did. And I know from growing up in Bavaria, you know, when the the harvest comes, that's when the the the the school boys and school girls and and students getting asked, "Can you please help the farmers? This, you know, we've got a big crop. We need helpers." and you earn some money per hour, which is nice. Everyone likes that's that's the harvest time, right? But if you divert millions of people forcibly transporting them away from the rural areas at harvest time or just around harvest time, that's certainly something you can do to disrupt um the the um the delivery of of of food in that year. So that was taken. Now it turned out to be not enough because you know farmers are
64:05resourceful and partly that you know they they had uh ways to still farm a lot harvest a lot of the um of the crops. Now um there is a natural or you know seemingly natural way you could reduce a harvest and if you read the Bible in bad years you know horrible things happened like swarms of locusts come and eat up the crops. Yes. Which is actually, you know, it's clearly not every year. It's unusual. It's so unusual that when it happens, you know, it's recorded for thousands of years like in the Bible. Wouldn't it be nice to arrange for that? Well, in in a bumper crop year, right, if you if your goal is to have a famine, of course, that's not so easy to arrange, right? Is
64:52it? uh particularly at a day and age where we did not yet have the insect laboratories where they breed various forms of genetically modified you know insects that could do all sorts of evil stuff you know that that wasn't yet happening but also it's unlikely that it would be um swarm swarms and swarms of locusts millions of locusts eating the harvest because in China there was a natural enemy of the you know giant grasshoppers the locusts named ly the ordinary um Asian tree sparrow. Yes.
65:30And and in fact in China is estimated as there's around 700 million of them the tree sparrows and they would you know in the in the development of the the locusts you know they intervene at the right point and they eat them and the lavi and and so on. Um, so you really if you wanted to have swans of locas, you would need of I mean nobody would think this up surely, but you would need a very specific policy that would declare the ordinary um Asian tree sparrow enemy number one that has to be killed and exterminated. And of course, that's what Mao did. And what happened was swarms of locusts destroyed quite a bit of the harvest. That's increasingly being studied. And
66:19it's quite clear that such a specific policy in this chain in this natural, you know, biological cycle where you intervene and destroy the enemy of the locusts as a specific policy that surely can't be by accident. Now, still it wasn't quite enough for an 80 million um famine. So now you need the usual Soviet style policies which is to um uh sequester um the harvest. You know the government moves in Yes. and seizes the harvest and it's taken from the people and it's not being sold or some of it is exported abroad to Romania. Exactly. Um and then some farmers have some storage because actually farmers always think of next year's crop. Do you want to keep some to plant next
67:06year? That's before genetically modified, you know, things were invented to destroy that natural uh cycle um of farmers behavior. Um so they went after those farmer anyone who stored food was declared um a a bourgeoa hoarder and and enemy of the people and was severely punished and of course the food and the the grain and all the storage was taken away. So put all this together and of course on top of that various communist campaigns um the famine took place and it was such a horrible disaster um and and as I said we're we're around 80 million as an estimate of people who starved um as a policy result. So we have to we have to realize that our leaders don't mind killing us.
67:56In fact they seem quite keen on killing ordinary people. Um and and perhaps one more link to China where we learn these things is you know um Deng Xiaoing and I I spoke about him last time we had our discussion how he introduced the high growth model. Yes. And Japan helped him as I said and um and I think that was great and he realized and the Japanese told him you need many many banks.
68:23You need thousands of small local banks that lend to small firms. It's decentralized decision-m you know you've got five instead of the Soviet originally started out with one bank right central bank only. Central decision-m doesn't work well. The Prussian principle of high growth which all these East Asian high growth economies adopted is decentralization. The subsidiarity principle decisions on the local level there they can be made flexibly as the situation demands and appropriately. Central planning is not informed enough can't react quickly enough and doesn't work and also the incentive structure is wrong because you know what's worse what's
69:00worse than being given an order that you know is is really counterproductive and useless and you still have to do it. is so frustrating and that's of course why the Soviet system failed um and the the Prussian decentralization work. I mean there's studies comparing the the German army with the British army in the first world war and the German army with the American army in the second world war and they conclude the the German army was always far more efficient and effective with smaller numbers better outcome and they found it's because decision-m was delegated to the lowest level the officer in the field had the decision-m power there was always the the goal
69:39is given but how you get there the officer in the field had to decide. Of course that meant that you had to train people better but that's a good thing if you've got yes better trained people and they make the decisions that's the right motivation then people are also motivated they know that they make a difference and their decisions will uh shape things and they can do the appropriate decisions in the fog of war things change so quickly central planning just cannot work likewise that was then applied in Prussia and in Germany in the economy through decentralized decision-m so not one central bank but thousands of small banks lending to small firms, credit creation, money
70:15creation in the banking system for productive investing, for productive business investment, you get job creation, growth and prosperity. And China did that. And so this this is the uh you know the the Chinese um high growth system um which Deng Xiaoping implemented and the rest is history. 40 years of high economic growth lifting more people out of poverty than anywhere in history. um you know 800 million people lifted out of tech you know according to the official definitions lifted out of poverty this has never happened before in history in such a short time period in one generation that's what China achieved using the Japanese model which is
70:54essentially the German model of high growth and um and so I was always surprised that Dengiaing who was behind this and did this really well and he's a good manager very humble person not you know this narcissistic type that um you know will take policies that selfish but really bad for ordinary people. He was not like so he was a good leader in many ways as far as I can tell. Um but he he also is the one who took the one child policy and we know that that's not that wasn't a good policy. Also if you think about it it's a sort of policy that you can see western decision makers uh western leaders liking like I mean there's lots of western leaders in history starting from Napoleon
71:39uh talking about oh if China you know wakes up and then they keep growing population growth and China will take over the world and you get this western sort of paranoia you know and to impose a policy that oh only one child is allowed sounds very much like a western idea to me that's always the sense I had like why would a Chinese leader particularly a high growth leader the high growth model means also you want high population growth population growth is good you want people to have um children you want to educate them well because that that's what leads to growth growth comes from productivity technology new ideas 100% of ideas come from people we need people
72:19um of course you know now they're trying to replace that with AI but um that has its its severe limitations and risk and dangers But um so you want more people normally but Denging imposed this one child policy. Then I looked into how did this happen and it turns out that it was early on when he was implementing the high growth system from Japan. The particular person who was asked who was invited to China as the key you know helper with this high growth system was very able Japanese um economic planner high growth planner of the 1960s and in 1978 when Denging came to Japan he asked he was he was told by the Japanese okay talk to this guy and he he was our
73:09man in the 60s now retired uh he may be able to help you and so Ping asked him can you please come to China soon like now. Um I need you now. 3 days later he was in China with you know there was 12 uh including other colleagues that he brought along. Now who was he? His name is um Okita family name Saburo Sabro Okita. Now by that time he had been recruited by the club of Rome into his the club of Rome's executive committee. What was the club is the club of Rome. Yeah, that is a very good question. What actually is the Club of Rome? Well, it's also an institution that, you know, this really big turning point 1971, that's when the Club of Rome um entered the world stage,
73:57so to speak. That's the year the US defaulted on its gold obligations. Yes. With its report um the limits to growth, this allegedly limits the growth. And of course, haven't we heard this before? I mean this the whole degrowth movement climate change all sorts growth is bad and we need to limit that limits the growth we've reached the limits of growth this has basically been the the story in the media ever since the club of Rome came out with this report so the club of ro was founded by and it's not really disputed by Rockefeller supported by Rockefeller certainly in the early years that was very clear they met in the Rockefeller villa in Italy and you know all
74:36that um and And very early on this executive committee um drafted also Mr. Okita from Japan which is very ironic because he's the high growth expert. But the Club of Rome's two main messages were economic growth is bad and we need to reduce it. We've reached the limits. We're going to destroy the planet. Blah blah blah. We need low growth. And secondly, h too many people on this planet in fact very much regurgitating the views of the East India Company leadership and its hired economist Malfus Thomas Malfus famous for his prediction population growth too high. Um there's not enough food. We're going to starve. We need to reduce the you know population growth. Sometimes
75:29what you read is it sounds more like we need to reduce the population. Of course that's what they did in India quite yes um clearly by result but to a large extent intentionally again these policy decisions famines and other uh taking people's livelihoods away destroying the textile industry in India millions of people RNA shots you know well the mo that's the modern version so um this is the message of the club of Rome and the club of Rome drafted this high growth expert now I think he was fairly innocent And you know he was at this stage he was you know uh retired um and he was called up by this you know selected selective sort of international body that has a good reputation
76:14to be in the executive committee and he agrees no many Japanese people want to be very international and all this nice famous people are there backing this so I'll join I don't think he was really part of the nefarious activities that are also going on but is clever from the club Rome and and it's backers Rockefeller Foundation uh viewpoint because he's the high growth guy to get him in the executive committee of a club that argues for low growth of you know low economic growth and low population growth really is certainly a way of getting a handle on the high growth model and making sure that it can be suppressed in the future. That's the job of the IMF and the
76:53World Bank for developing countries not allowed to adopt the high growth policies. Um and when it comes to China effectively I think whether an explicit deal or just an implicit deal happened namely Deng Xiaoping was allowed to run the high growth model also attracted American investment.
77:15So it you know that that was allowed to happen but there seems to have been a required payoff and that is to impose the one child policy. So at least implement half of the Club of Rome agenda and the other half well we'll come to that later sort of thing could have been the attitude when I looked into so how did Denza Ping adopt this one child policy how did it exactly happen turns out that he took the advice of a Chinese statistician mathematician who is who was working for the military doing complicated ballistic calculations you know so using mathematics which is pure logic.
77:59And he did then uh he was asked to do population growth trajectories. Okay. And of course they were um scary and he came to this conclusion we need to restrict population growth. Now the key thing is this and I call this the great deception. He was using simulations and if you look at okay what did this military statistician mathematician what did he use what sort of approach what sort of model he used the club of Rome model. Now why was a Chinese sort of military related mathematician using the club of ro model? Of course it was in the west it was propagated. It could just be by chance that he just saw the headlines in some western publications. That's a leading model.
78:47we'll use that but or maybe other channels to do with Rockefeller visiting China and and who knows but we know the result that he used as a fact the um Club of Rome's model which entirely simulation and that is a great deception because you can make up any simulation of anything and present it but it's used to convince people and give the impression that it's factual and this is used in economics it's used for growth trajectories. Um it's used for um population growth trajectories to show that it's unsustainable and it's used of course for climate scenarios and it's used for declaring pandemics, you know, how the virus grows. It turns out it's all simulation,
79:33madeup stuff, but I'll I'll come back to this in a moment um because that's actually interesting way of um deceiving people. Fact is, okay, that's what he used. Club of Rome um model simulations and Deng Xiaoping declaring, "Yep, we should listen to this guy. You know, we have no other choice. We have to do this." So, it's not really clear why on earth he came to this conclusion. Maybe he just fell like many people for the simulation approach. Or maybe there are other reasons, but that's a fact. And so we see that we do have influential international forces that are anti-population growth, potentially anti-population um and also anti-growth and and
80:18we don't well it's not really factually based. You know this this um great deception started really again in the British Empire um in the 19th century. It it's really the source of of modern economics. This is how modern economics was was developed. It started with the so-called classical economists in Britain. And the key figure here is David Ricardo. Who is he? Well, he's a famous classical economist. He did the theory of free trade. You know, the theory of comparative advantage which concludes well we should have free trade. It gives us prosperity. Yes. And at the same time uh the argument is well the previous economists the mercantalists mercantile economists
81:05they were so wrong because they argued well we may need some trade policy we need some intervention we need to make sure that the benefits from trade are properly equally distributed that's what the mercantalist said and ever since David Ricardo uh this is claimed to have been disproven and it's just free trade is best also to unilateral free trade and that's exactly what the IMF and the World Bank are preaching and enforcing in their policies on developing countries you know the conditionality you get money carrot but here's the stick you have to adopt these in these policies free trade policies allow foreign investment deregulate liberalize privatiz which
81:46effectively means these countries are stuck in a low value added activity exporting commodities they're not allowed to build up their own industries move up the value added ladder and they're not allowed to prevent foreigners from buying up their industries cheaply. Now, empirically, this model is is been proven wrong many times over. Uh actually, Preish and Singer showed already a long time ago that commodities exporters have declining terms of trade. Yes. Now, what does that mean? Terms of trade is is u is simply the um export price divided by the import price. It's basically the relative price you get for what you're selling compared to what you have
82:27to buy, what you're importing, right? And and what they've shown is that if you're exporting commodities and if you're focusing on that, that means all your high valued goods, manufacturing goods are imported, right? And that's the position developing countries in. But if you are in this position, what happens over time and they looked at around almost half a century um actually more than half a century. You could show that the terms of trade must deteriorate which means you will ever get less for your exports in relative terms and you have to pay ever more for your imports and therefore you're getting poorer and you're not getting the benefit from from trade. That's what
83:11the IMF and the World Bank are locking developing countries in through their policy regime. And it's not a coincidence and even David Ricardo knew this very well. The trick was this. How did he prove that you know free trade is the best and intervention is always bad. Well, he didn't actually prove it. All he did is he presented some nice mathematics. Now, mathematics is logic and the logic is correct. And here's the trick. Here's the great deception. We like logic. Men like logic. People like logic. Logic is convincing to us and so convincing that we forget one small but fundamental issue. Logic is not truth. Well, hang on. Why is that? Well, if it's logical, it must be
83:55true. No, there's there's a difference. Logic can only ever tell us about theoretical possibilities, but never tell us about what is true and what is not true. That's an empirical question. Logic is not empirical. It's not evidence based. No. Whether something is true or not, whether something happened or not, it's always evidence- based. You have to check the evidence. That's the inductive approach. Whereas logic is mathematics. You know, mathematics is logic. Um and and it usually is used um consist correctly consistently. Therefore, you've got consistent logic. That's why it's so convincing. But the conclusion doesn't tell you that you should do this. Well, it's
84:36not perfectly predictive. It's not predictive at all. And also, it may not describe the world. It may not describe reality because it depends on the assumptions that you've used to build this model.
84:45And that's where they exactly cheat you. So, the assumptions in Ricardo's model are highly specific and unrealistic. That's how economics has worked ever since. In fact, it's called Ricardo's vice.
85:02So modern economics and you know historians of economic thought agree on this. Modern economics essentially in was invented by David Ricardo. It's called the Ricardian vice which is to um make such assumptions that you will come to the conclusions that you desire. Right? And and so it's of course not scientific. It's not scientific at at all. It is a way of deceiving people and you don't point out that this is only a scenario. It's a simulation that could be true on some planet. But we are not saying anything about whether this actually applies to this or not. And so in sophistry really. Yes, it is. Um but but also you could say it's rhetoric or it's
85:50marketing because you're trying to convince people of something that you've concluded you want to do.
85:54Exactly. And you provide the expos justification and it's it is impressive. Oh wow, so much clever mathematics. This is a real clever scientist. Well, it must be true. Whatever he's saying, this is essentially how economics has been working. And now David Ricardo doesn't point out that his conclusion depends crucially on on the terms of trade on what is that post trade price. What is the relative price of things? He has nothing on that. He just leaves that out. But that's the crucial factor. And the problem is that developing countries have a deteriorating terms of trade if they follow his advice. So he's essentially David Ricard essentially proven what everyone already
86:33knew that trade can potentially be beneficial for everyone because we create benefits through trade. That's not in doubt. The mercantalists knew that. I wonder why they're called mercantalists.
86:47Mercantile merchant trade. They favor trade. They said, "Let's trade. This is where prosperity comes from, from trade." That's what the mercantalists said. So why are they so wrong? Well, they're not wrong. They were not wrong. They actually were a step further than Ricardo. They talked about the distribution of those benefits from trade. They said trade can be beneficial. There will be benefits. But who's getting those benefits? Well, exactly. How is that distributed? That depends on the terms of trade, which is what Ricardo totally and on purpose left out. I think I'm starting to understand how the world works. and and this deception has been used consistently in economics
87:24but has been used in other disciplines you know so so this is how they persuade this is how the club of Rome operated so their model of oh there's too much growth and growth is bad and we need to suppress growth is based on the same approach assumptions it's a simulation it's not truth and it's turned out to be wrong you know we're more than halfway through their 100year forecast and we're you know they've been proven incorrect not where they said we'd Yeah, exactly. Um, it's true for the population growth scenarios. We don't have too much population growth. That's quite clear if you look at the facts. So, it's been disproven there because it's just been simulations. And
88:02it's been true for the pandemic simulations. It's been true for the climate simulation, which also just simulations. And just recently we hear that oh you know the the IPCC's is is admitting and and people at the UN admitting well these were extreme scenarios and and yes they're implausible um you know it's increasingly being a bit because that's what it was just always an extreme too late for the German economy a simulation yes of course well people need to be aware that policy makers when they impose bad policies they use this clever sophistry of um simulation ations the deductive approach is presented as very logical and it is logical but
88:44logic is not truth that's the key point truth is based on evidence and facts and very often you can quickly debunk all of these models so I mean given that and I mean part of what you're saying is it is hard to project into the future it's just hard to know because of the number of variables but I'm going to ask you do it anyway so given everything you've just said your understanding of what this conflict with Iran is really about, what the conflict with Venezuela is really about.
89:12It's really about China and the contest for global hijgemony between the United States and China. Um, and that is likely to flower into a world war. I think it's hard to imagine the United States wins in any conclusive way given that it's a smaller country, population, economy, smaller, less technologically advanced in some ways than China. So what happens then? So let's just jump right ahead. So let's say there's some kind of conflict. Hopefully it's limited in scale but whatever it is. But China remains after that. All the systems that you're talking about which have been in place for hundreds of years. First under the British, now under us, the Americans, they're
89:54replaced by what? What? What are the systems that govern the world when China's in charge? Well, exactly. You've said it already. systems that govern the world. Yes. Not countries. Exactly.
90:08So it that's what it seems to be about to um to entrench a new system, a more effective system from the viewpoint of the central planners to govern the world. Exactly. Because these crises, whether it's economic, you feel that it's very obvious, right? Yeah. Exactly. And clearly wars have always been used. you know, you shake up the old structure, you've got your ready new structure that you want to implement. Yes. And that's what it seems to be about. Now, that structure as in past, you know, of wars um includes, of course, as a core pillar, the international monetary system. There's no doubt about that. Yes. The monetary system, you know, first world war,
90:52the result of the first world war was the creation of the League of Nations. Yes. Um and the League of Nations had particular views. The problem was America never joined the League of Nations because America was still you know a bit more sort of you know representatives of elected representatives would represent what their constituents wanted and people didn't want it why you know and in fact the first world would just prove the point that it's not a great idea to get involved in these international conflicts right so uh America didn't join the League of Nations and that was another reason why another round was considered necessary and so towards the end of the Second World War,
91:32the United Nations were created. In fact, did you know the United What is the United Nations?
91:36It's the renamed Allied uh countries. They simply renamed them. Security Council. Yeah. Um um you know, so the Second World War Allied countries were renamed United Nations. Sounds nicer, which is why Germany, you know, and and Japan are still enemy countries in the in the United Nations charter. and they created in 44 uh the bread and wood system based on the dollar. So it was a clear transfer uh from the the British Empire as an as a dominant force to America. Um there was a bit of a internal battle between America and Britain. Kanes was negotiator for Britain. Um you know he was already director of the Bank of England shareholder and the Bank of England. Um he died
92:20um unfortunately sort of uh sort of at the time of these negotiations. Anyway, one way or another, America won the argument, it seems, and it was the dollar that um was going to be used in the system. Um and and of course, this the Bretonwoods conference, you know, in in New Hampshire in the uh what was it the Washington Hotel in in New Hampshire in Breton Woods is meant to be a global conference of all the representative. It was basically Britain and America and their colonial subjects being represented by somebody but they had to say whatever Britain and America wanted to say. So it wasn't the world. The Soviet Union was there but then quickly after that dropped
93:01out and thought no we don't want to be part of this. China was represented by some people that you know America was supporting in China who later of course were not really in power and had nothing to do with China really but they went to Formosa. Yes. For instance. Um that's right. So um it was really America and Britain um calling the shots and deciding things and it was very much about the monetary system and the structure United Nations and the organizations I'm of World Bank to run the world. So that's also I think what this is about and I think you see if the goal just for sake of argument is to have a one world government a proper one world government that controls the
93:43world um and I don't think it's a good idea by the way just want to make that clear okay um because thank you doctor because decentralization is the best we have already too much centralization and this is going to be quite a nightmare, totalitarian nightmare unfortunately. But there are people power- hungry, you know, psychopaths who want more power and, you know, over time in history, we see their footsteps. Um, and that's clearly where, you know, that's at least one um red thread going through history that forces are being aimed at this for one reason or another.
94:22So I think as a working hypothesis we can put it on the table that there's people some people out there who want to create a one world government. Um and if that's the goal you know you know what what your obstacle is. I think it's it's just like with the League of Nations. It's America from their viewpoint. I mean I'm not saying America is the obstacle uh or is is you know America is bad if it's opposing this. I think that's a good thing. America should oppose this. But from their viewpoint America is an obstacle. So America has to be taken down. the dollar has to be taken down.
94:53Now, a lot of the people fighting for this may be in the American government. Who knows? You know, I'm, you know, it doesn't mean they are necessarily outside America. That's right.
95:02But there are people who are working seem to be working for this goal. At least that's the evidence we get when we use the evidence-based approach, not simulations and scenarios. And you know, where would the capital of this world government be, do you think? Oh, that's a good question. clearly a political question and there will be debates but perhaps they already have a preferred location. Um so I yeah I don't want to be drawn into speculation because of course from my viewpoint it doesn't actually matter but once we see it I think it will tell us a lot. Uh but it doesn't really matter for this argument. So maybe maybe Yeah, I wouldn't speculate either. I
95:39would just think you know logic suggests it would not be east or west but in the middle. Yes, that could be that could be. Yeah. um that that would be an argument because of course if it's like the United Nations again you see and always they move it you see first world war league of nations after first world war was in Geneva Switzerland you know some arguments for that it's sort of international territory but Europe well then United Nations because America didn't join so you needed to be in America United Nations uh of course Rockefeller gave the land um and helped a lot in building up the UN uh institutions was very much involved you know so you know we see the Rockefellers
96:15there Rockefeller foundation quite active. Um but if you move to the next step and you realize just by logic that America is now the obstacle because why would America subordinate itself to an outside body? Exactly. Why would America uh give up the the dollar dominance? No. And actually, you know, have an international currency that is not the dollar which would be necessary for this new one world government. So America becomes the obstacle. Uh so then you can't have it in America, right? Um or to to make it clear that America is no longer the dominant force. It's now a new thing. It's a world government that is different which you would want to use to motivate other people right outside
96:58America. So then it would be in America and then where could it be? And so then yeah um a few things a few places come to mind. But also how do you go about this? And what we learn from history is it's always the same mechanisms. Um warfare is an important one at least for big changes.
97:18There are many changes you can do without war and that is through economic you could say economic war but economic cycles boom bust cycles long deep recessions downturns they shake up society high inflation it's also part of that is also economic warfare on the people shakes up society like high inflation in Germany in the 1920s clearly was uh one way to get Hitler into power is the beginning um and by the way we may not have time to to go there but um you know the the person who was put in charge um sort of at the peak of this high inflation became head of the German central bank in Vimmore yes Shak was his name he was appointed by um by foreigners
98:08not by Germans so there's no doubt about that because um the they call themselves now Victor Victoria victorious powers of the first world war although it was an armistice allegedly um but they decided that no we we are going to occupy Germany Germany then became occupied by foreign um troops you know the rhin African troops y yes yes indeed indeed and yeah it wasn't too pleasant but um and and so also its central bank was taken under foreign control formally there was a new central bank act and it stated that half of the board members have to be foreigners they couldn't be German and in total because also the president was effectively appointed by the foreigners which
98:53foreigners are we talking about was mainly in practice it's not really in dispute it was the uh the JP Morgan le reparations committee because the story was that during the first world war Britain funded its war effort by borrowing money from JP Morgan that was already the first step of transferring power from Britain to America yes um and because you didn't have to do that.
99:16There were alternatives, but Britain chose, it seems, you know, chose to do this. Um, and so, um, JP Morgan then was the one that money was owed to by Britain. It was it was more than 10% of American GDP. It was not a small sum. And therefore, after the first world war, Britain had to do what JP Morgan was recommending really. and JP Morgan was thinking well Britain is not going to really repay this money uh we better get it from Germany and so the reparation committee was all about Germany paying Britain to pay JP Mong so really it was from Germany to JP Morgan and um this started to become entrenched in if you look at the German central banks the first step
100:01was this this new law um that made the German central bank totally independent from government and from any um democratic assemblies in Germany. The rice bank was made unaccountable to anyone.
100:15It was the the most independent central bank in the world while also at the same time being 100% privately owned. By the way, Rice Bank was privately owned. So um and this rice bank then as soon as the uh the ink had dried on this new uh statutory independence but of course dependence on JP Morgan's wishes, the reparations committee was appointing these foreigners. You see um the hyperinflation started in Germany and they then put Yamash in power um at the helm of the um rice bank and it was the same who then um took the steps I mean we need another session on um on the details but he took the steps that brought Hitler into power
101:01um and even approached the Nazi party and said well you guys have some interesting ideas but you I have a really good economic program. I'll give you how to get out of the great depression that he helped to export to Germany through his policies at the rice bank. So that's how the plot thickens. And then of course when Hitler was appointed on strong recommendation from Helmasht who was highly respected by that time because he was he was actually known as dictator the the the the monetary and credit dictator because he he he decided over life and death of German companies in the 1920s when the rice bank said no then the company wouldn't get credit from the banks and
101:37would be finished. Um so this guy recommended Hitler and then he was appointed even though he didn't have the absolute majority in parliament. He was appointed chancellor and then immediately appointed as head of the central bank again who then very quickly did the right policies sort of early versions of my QE quantitative easing to rev up the German economy and so by 1936 so only after 3 years you know Germany was also in the great depression you have to understand I mean there was large scale unemployment 20 25% unemployment and then Shashak who had created those policies that created this and exported the great depression from America to Germany knew how to get
102:22out of it quickly and adopted these policies. So Germany by 1936 um just when when Kanes in Britain was publishing his analysis of you know what could be behind this great depression and what could be done to get out of it which is his recommendation fiscal policy well shocked had already led Germany to full employment and shortage of labor that's how the economy was booming in 1936 and it wasn't through fiscal policy as often said oh that was military spending oh no no German military spending only picked up much later um it was monetary policy credit creation for productive business investment in many industries, high technology industries. That's what led Germany
103:00out of that bank credit creation and Shak knew that because he was also known as the the credit magicians, the wizard of credit creation. So it turns out there was just one lever in the German economy and it was monetary policy and when you cranked it in one direction, people thrived. When you cranked in the other direction, they starve to death. That's right. But it's always the same everywhere. It's not just Germany. It's always bank credit. That's what shows you what's going.
103:22That's why they're hiding it. That's why even today in leading economics textbooks, there are no banks. There's no bank credit creation. Central banks still use their equilibrium models, dynamic stoastic equilibrium models, general equilibrium models where there's no banks, there's no need for banks. Well, this is what David Ricardo started. I mean his in his fake economics, this based on this um you know all these assumptions, this aimatic hypothetical very logical and therefore convincing economics, there are no banks. There's no bank credit question. Who was Who was David Ricardo?
103:54Well, he was a banker. He just retired at the age of 42. Was he British? He was British. He made a fortune in the city working with um um well, working with a very rich banking dynasty, making a fortune so that he's known as the second richest person in Britain. Banking dynasty. Well, exactly. And and why second richest? Who was the richest? Well, that was Rothschild's and that's where he was most likely making his money because he was in the bond market in 1815. Rothschild made a a fortune in the bond market through inside knowledge um of what's going on. If you fund wars, you know, you know, slightly earlier what's going to happen. That episode is quite well documented,
104:41but Ricardo was a bond trader. He was likely one of those who as agents bought the bonds when they were at the rock bottom. and you could get them for I don't know um 20 pennies in the pound um for Rodri without people realizing you know Ro is actually buying them very cheaply and then owned the entire national debt and then could say to the Bank of England well actually your assets are mostly the bonds um I'm the biggest bond owner I'm buying the chairs the shares cheaply um and could dictate anything to the government or the royal house uh it seems um but this David Ricardo having made his fortune then retired at the age of 42 and built himself a nice little country house
105:29u princess royal princess anne lives in it today so you know it's probably quite impressive I think 700 acres of land and anyway so you know he was seriously um wealthy what did he do with the rest of his time he decided to create modern economics which is based on assumptions this hypothetical aimatic deductive simulation. Now you can make any assumption in logic why not but when certain assumptions become compulsory like you have to assume right perfect information complete markets rational agents and all that stuff you know then it's an ideology that's the definition of an ideology that's religion at that point that's what economics becomes and the trick is
106:12this that once you have these assumptions then you can show that in equilibrium demand equals supply prices move to give us equilibrium it's prices that dominate never look at quantities and this is what's being pushed. I mean modern economics is equilibrium economics and the the um the irony is there is no equilibrium that's made up because this scenario is so hypothetical.
106:36What is the probability of having equilibrium? You need at least eight assumptions to hold at the same time but each assumption has a probability of probably less than 1% of being true. But let's say for the sake of argument each assumption like perfect information, complete markets, you know, zero transaction cost. If each assumption had a probability of being more likely to be true than not 50 more than 50%, 55%. Okay, but you've got eight of these assumptions. They all need to be true at the same time to get equilibrium. What is the probability of getting equilibrium when each assumption is more likely to be true than not 55%. Well, it's 0.55% to the power of 8. You need
107:17all of them to hold at the same time. Conditional probability. So while they love to use logic and math, that's the calculation they don't reveals it as a lie. Exactly. Because what is the result?
107:27Even if each is is, you know, is more likely to be true than not with 55% probability, the joint probability is less than 1%. But of course, each assumption has a probability closer to zero, less than 1%, I would So, in other words, when Americans say, non-economists say, "This doesn't look like a free market economy to me," they're right. Of course, there is not even equilibrium.
107:51It doesn't exist. It's so unlikely to ever be true that we know for sure there's no equilibrium any market, but central banks are using general equilibrium models. That means equilibrium, not just in one market, but in all markets at the same time. That's even less likely. That's like the probability 0.0000 whatever percent. So the real power is with the governors of the central bank.
108:15Exactly. But also what you're hiding with this equilibria economics is the power of the is is actually power. You could say power e economists would say well let's not talk about power. We're about economics. We don't power doesn't enter the equation. Why? Because it's equilibrium economics.
108:32Prices move. You get this outcome. You're unemployed. I'm sorry. That's the markets. There's no power. But the moment you realize that actually all markets are rationed then the so-called short side principle applies which is whichever quantity of demand or supply is smaller determines the outcome and has power to pick and choose with who to trade. That's the power that we realize is there all the time and that's the reality of markets. So that means people um the short side whatever that may be in any market has power that's totally ignored by economists. So this is why equilibrium this this deductive equilibrium approach this deception is so useful. You never
109:17think of looking for the power players the power holders. Of course when it comes to money um is the equilibrium demand and supply is it equal? Well, no, because the demand for money is essentially infinite. And of course, the short side is the supply of money. So, whoever supplies money has power to pick and choose who to give it to, how much to give it to, for what purposes.
109:38Now, who is creating the money? That is the banks. And of course that's why we need many small banks, local banks because then you're giving this power which is then power over the whole economy really because it's the power over money creation and and availability of money purging power. You give it back to the people to the local areas and that's why the central planners have been setting out on a campaign to destroy small banks, local banks. And so the in the background is this deception that is equilibrium when actually all markets are rationed and there's power players. It's the short
110:11side and when it comes to money, it's the supplies of money. But it's really the big banks and the central banks that have usurped that. That's why we need to decentralize and have many small banks. There is actually a person at the Federal Reserve now who's vice chair of supervision um Mickey Bowman. She is an advocate of small banks and local banks. So there is hope. I mean she should be the next um really um chair of the board of governors of the Federal Reserve system. But of course we have somebody else starting in the in the interim. But hopefully she will still be there and continue to fight for small banks. We need some other changes to make it easier to create
110:48new banks. That should be deregulated. There was an era in America of high growth when you could very easily set up a bank. Well, why don't we have that? You know, it's virtually impossible to set up a bank. Well, they suddenly make it very hard. So, um, it doesn't sound like the political environment that we're in, which is clearly accelerating, we're moving towards something, its outlines are not clear, but we're moving at high speed. It doesn't sound like we're moving toward decentralization of anything, right? The the trend is continues to be centralization. They're reducing the number of banks. The ECB has overseen the disappearance of 6,000 banks in Europe. That's
111:32very sad. Um, they continue to drop their numbers also in America. That needs to be reversed because that as the number of banks goes down, there's less economic growth. There's less prosperity for the middle class. It is really a war on the middle class if you destroy the small banks.
111:48But that continues to take place. And it's even official ECB policy. Of course, the background to that is that the ECB um is the revived rice bank. I've I've told you about how powerful this foreign controlled rice bank was. So once Germany um was defeated in the Second World War, postwar Germany thinkers there were given some leeway to think about okay how to do the the monetary system the central bank and they concluded well the problem was the central bank was too powerful.
112:20It's no good being privately owned. So it should be stateowned. But more importantly, it should be made accountable to democratic assemblies to parliament which the rice bank was not uh due to the controlled by the reparations committee which was later by the way renamed the BIS bank for international settlement. That is the continuation effectively of the JP Morgan reparations committee. you see um but um the Bundesbank was then um made accountable to parliament and its independence was reduced. That's the big insight and as a result we had a very successful central bank in Germany that throughout the existence of an independent Bundes Bank independent from
113:06um the government but dependent on parliament and laws were made for it by parliament that for example it also needs to look at growth and and employment you know you can't have huge unemployment it's no good having low inflation but a huge recession right so that was the law it performed very well so it made other central banks look bad. It also never created these asset bubbles because if you allow banks or encourage banks to to lend for asset purchases, you get because it's money creation. You get asset bubbles which lead to banking crisis and that's the system played in many countries certainly in England boom bust cycles all the time but many countries
113:42um the central banks have been playing this game which then can be used to rearrange ownership and all sorts of things as a world bank report pointed out about the Asian crisis. Oh, the Asian crisis is a window of opportunity to rearrange ownership. Oh, interesting. That's World Bank report. Um, so the the Bundes Bank was a good central bank, probably one of the best in history, I would say. And it because it made other central banks look bad. Its days were unfortunately numbered. Germany allowed itself to give up the Bundesbang and give up its currency, the Demar.
114:13Now the Demar had become the European currency. So what was marketed? I remember that. That's right.
114:21It was by market forces and voluntary decisions. Other countries decided to peg themselves to demark. Yeah. Voluntarily that nobody was forced to do that. And so what really was was marketed as the introduction of the European currency, the euro was actually the destruction of the European currency, the demar, and also the destruction of this good central bank. Now really the destruction of Germany itself. That's right. That's when it started and I was a fierce opponent in the 1990s but it was like a taboo to to say oh giving up the demog is a bad thing um in in public debates. I was chief economist of a British investment bank and so invited to
115:00various events in Germany also and other German bank Deutsche Bank chief economists were there and I would say well we we can't give up the demark there's no good economic rationale and silence and some would say oh they wouldn't engage on on that point because it's true they would then say oh but there's a good political rational there's a moral rational and moral I want to hear that one because that is an even worse argument but no but that's you you know when a society's collapsing when every argument becomes a moral moral argument. That's right. So then fighting Russia, so we're good. Okay. So then they introduced they abolished the European currency, the demog,
115:34and they introduced the euro with its own central bank, the ECB. Now they marketed this as, oh, the ECB will be like the bun bank, it's going to be in Frankfurt. It's going to be the same as independent as the bunes. Well, hang on. The the lesson from the rice bank and the bunes was to make the central bank less independent. Turns out, as I show actually my book, Princes of the Yen, um, quantumpublishers.com is the place to get it. Amazon is not really the place to get it. Um, it was a book that was impossible to get it. It's like $500 on eBay, but you've reissued it. Yes. Quantum.com. So, there's a chapter here on on this. The ECB is
116:13the revived rice bank. It was modeled on the um on the worst central bank in history, which is of course why I predicted that the ECB was likely to create bank credit driven asset bubbles, banking crisis and big recessions in the Euro zone. And that's exactly what they did. Ireland, Portugal, Spain, Greece. Well, and not just in the Euro zone, but in the United States. So here's my here's my last question. I am going to ask you to predict and project. So go out on a limb. But um you know the United States has been experiencing I think what's fair to call an asset bubble.
116:47Certainly you see it in real estate markets but not just real estate um cryptocurrency etc. What happens to assets in the United States as this war progresses and as the global system changes?
117:06Well, um I in principle of course in in real estate markets we have we have a we have big cycles. Um they're slowm moving and the cycles are function of in real estate of interest rates and the quantity of credit for more importantly uh for uh real estate transactions.
117:25um assets are somewhat overpriced I dare say uh in the US but particularly when you look at stock markets it doesn't necessarily mean there will be an immediate crash but I do think we are heading uh towards a crisis and again you know if you look at at the big game that's being played then it's quite clear this this has to happen if the working hypothesis is that there are forces out there that want to dethrone America. Yes. And they may be active in America even these forces.
117:59No question about it. Um and that means also dethroning the dollar. Um and that would explain why China actually had been strengthened with American investment in the past because you're building up this this opponent that can help take down America. Um if you make sure America stays aggressive and and and adopts anti-China policies, you know, which also seems to be happening to some extent. So then what are the scenarios and what's the way well as we said whenever you have these big wars they lead to currency system changes the global financial system changes so we moved from first the British pound which was on and off the gold standard then we moved to the Bretonwoods
118:43dollar standard which was a gold standard and but of course gold standard you know some people think oh that means it's one to1 to gold and you can't create money. No, that never happened. Such a gold standard never exists. It's always been bank credit creation and that's how the real game is played. But it's some kind of limit because as soon as you know turns out America was creating too much too many dollars buying up assets in Europe, the French were not yet part of NATO, therefore not part of the command structure. It was the French that uh called out American like our gold, please. And they said, "Okay, you're printing all these dollars and you're buying
119:18us up. Um what we can do is we can change these dollars now into gold. We want to see gold." Um so that's you know um but so then we moved from the 71 Nixon shock US default on its international gold obligations. Then we move to the petro dollar which of course is very closely intertwined to actions in the Middle East and all the wars in the Middle East. Oil was only allowed to be sold against the US dollar. Anyone who did otherwise whether it's in uh Iraq Saddam Hussein or in Libya Gaddafi that was a big no no and led to severe consequences warfare and you get killed for that. You get killed for it. Exactly. Um so what's next? Because also when the last
120:03uh you know when the Nixon shock happened and we moved from the gold dollar to the petro dollar there was also inflation. You inflation is a good camouflage that you know it sort of makes it easier to rearrange the monetary system. It was entirely monetary inflation by the way not uh energydriven. It was the central banks creating a lot of money but we had the same in 2020 with the co scop money creation by central banks. No economic rationale for this. whatsoever. It was clear 18 months later we get inflation as a result that's what happened. So it looks like we're and and you know now we could be um it looks like we're heading into the second run of inflation.
120:42still early stage is not entirely clear but that would be my guess without having yet the necessary data but I think there will be a second uh bout of inflation and but we already had the first bout and and it indicates that we are in this phase of running up towards the next rearrangement of the monetary system what is it going to be well that seems to be increasingly clear it's going to be digital based on digital identity and I think we therefore should oppose digital ID on all fronts. We're humans. We're not digits, you know. We have digits, 10 digits, okay? But, you know, we should not subject ourselves to um to this regime where if you don't provide the right digital ID
121:27credentials, you're not accepted as a human and you don't have the human rights in reality. I mean, that's and you know, dehumanizing. We should reject it just on that principle, but there's many other reasons why we should reject it. It is the beginning of this control regime of a digital currency. Now digital currency as such is not a a bad thing because for half a century we've been using bank digital currency BDC we could call it because the banking system been digital and and most money is created by banks. It's digital money. We have been using decentralized bank digital money and actually has worked quite well and the banks have never sold our personal
122:01transactions data to anyone. So actually we should lord the banks because the new regime is all about you know our information about our transactions being sold freely. The government is now Facebook and and and yes being used to manipulate us whether it's in elections or you know to sell products and and services that we don't really need. So it's going to be a digital currency.
122:26It is marketed as CBDC central bank digital currency. I call it central bank digital control.
122:34because that's what it is. It's not really a currency. It's it's more control as um um as Katherine Austin Fitz always points out quite correctly. Um and so because we've been using BDC, bank digital currency, what is the difference? It's the central. They tell us justification Christine Lagard that oh we need this because there's Bitcoin. We need digital central bank currency now as well. Well, the digital is not the new aspect. we have digital money. It's the central aspect that this is about because and particularly if there's there's now another bout of inflation and in some countries with a boom bust cycles being arranged such that in Germany
123:16we are heading we're in a property bust. Now there was the bubble arranged by the ECB from 2009 to 2022. Now property prices are steadily declining putting banks slowly under more and more pressure.
123:30They were forced to do this by the ECB. It's the same game. It's the Bank of Japan's game, you know, in Japan. And so banking crisis of course is ideal and inflation to launch your CBDC. That's for Europe. In other countries, there may be slightly other ration uh justifications for introducing it. But a crisis one way or another is always good. A war of course is even better because then it's just wartime uh direct dictats. You can't do anything. It's war time. You have to accept whatever you're told. um and as a wartime measure. Of course, that's the ultimate, you know, if everything else fails, then definitely wartime measures will be used to introduce uh these
124:08these measures. So, we're heading towards digital control systems where we have no more control over over our liquid assets. It will be um of course programmable, permission based. So only what the central planners allow you to use your your money for at what time and place and location will be permitted. And if you're in the wrong place, it's not going to work. And if you're buying the wrong book title, it's not going to work. And so on. I mean, there's no limit to how much you can fine-tune and control. Oh, they don't have so much power. They can't control, you know, millions of people. Well, this is what the drive to build all these hundreds, in fact, thousands of data centers
124:50is about. It is an organizational challenge to micromanage the world's population through the new um financial world order. Yes, but they're working on solving that AI is really about that. If AI was about helping us to be more productive, the principle of decentralization would be applied because any human organization and any use and any anything where humans are involved if you introduce the principle of decentralization subsidiarity it will be more productive no doubt more efficient more productive that's been demonstrated in many contexts. I mentioned the the warfare military but and businesses and so on. It's true for everything but that's not what
125:32they're doing. They're creating highly centralized structures which proves that it's not about actual productivity. It's about control controlling us. That's why they need these huge resources.
125:44Then you can control inflation easily because people can't buy when the central banks don't allow you to buy. So then prices are can't be driven up. Um and also you control movement of people. You can't buy a ticket. you can't go here and there because your money won't work outside a certain zone whether it's 15minute prison zone or whatever it may be. It is the totalitarian dictator's dream come true. And that is the scary thing. Most people are still not aware that we are so close to the scariest most dystopian system where we're giving so much control and power into the hands of ever fewer people over our lives. and billions of people. Again, if everyone is good,
126:32like the majority of people, and the controllers, the elites, the central planners are good, it's not an issue. But that's not what human history um teaches us. And human nature we know is different.
126:43Most people actually once they're given a lot of power that comes with temptations of power and most can't handle those temptations and they give in and then that's when power gets abused.
126:54That's why Lord Actton um a British uh political observer and advisor to prime ministers concluded power corrupts. Most people get corrupted by power. They can't handle power and absolute power corrupts absolutely. We are talking about absolute power in the hands of central planners if we allow the central bank digital currency to be imposed. And um and the central planners um will have this absolute power including you know of course they have already monetary power but they will have the tools um to deploy this in every detail to micromanage us. That is a new dimension of power and effectively includes fiscal policy because ultimately everything becomes controlled by the
127:45central bank. So now you could still say well we have some politicians they meet for parliamentary votes and they decide budgets. Well all that will become obsolete because everything will be controlled by the central bank. This is what the politicians don't realize that the central bank digital currency is the first step by the central planners the monetary central planners to take over everything. So the dangers are just so manifold that it's it's quite clear that we have to stop this. So um I mean this is really the big scenario and that's where we see forces pushing as internationally power gets ever more centralized despite this being the biggest lesson
128:27of the 20th century that it's not a good idea to constantly have more power in the hands of few and fewer people. that's actually being accelerated in the 21st century on on the basis of lies about the 20th century. Indeed. Indeed. Yeah. Richard, thank you and I hope this won't be your last trip here. It' be a pleasure. It's a pleasure to be here and I hope I can come again. I mean, there's literally anytime I'm I'll be thinking about this for the next month. Fantastic. Thanks very much.
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