Episodes

Dan Ferris:                 [Interlude plays] Hello, and welcome to the Stansberry Investor Hour. I'm Dan Ferris. I'm the editor of Extreme Value and The Ferris Report, both published by Stansberry Research.

Corey McLaughlin:    And I'm Corey McLaughlin, editor of the Stansberry Daily Digest. Today, we talk with David Collum, chemistry professor from Cornell University.

Dan Ferris:                 And Corey and I will talk about the personal consumption expenditures index.

Corey McLaughlin:    And remember. If you want to ask us a question or tell us what's on your mind, e-mail us at [email protected].

Dan Ferris:                 That and more right now on the Stansberry Investor Hour. I cannot wait for you folks to hear our interview with David Collum. David is an old friend. He's been around the show a long time. He's been on Stansberry, you know, on the podcast. He’s spoken at our conferences. He's a brilliant guy who takes deep dives not just into the scientific issues that he does by trade but into all kinds of social and economic and financial issues as well. A fascinating individual. Wouldn't you say, Corey?

Corey McLaughlin:    Yeah. I'm fascinated to see what he's going to say here. Chemistry professor by trade, as you said, but pretty outspoken about all kinds of different topics and issues. Finance, political and everything in between.

Dan Ferris:                 Yes. Yes. We talked a lot about a lot of things. And a little bit of finance. But all kinds of other topics. I don't want to give anything away but, you know, Dave is known to take – really to take his time looking into all kinds of, you know, political and other developments. And if something big happens in the news, like a shooting or, you know, the pandemic or anything like that, you better believe – I don't even need to think about it.

As soon as it happens I know Dave Collum is reading everything he can gets his hand on and talking to, like, major players involved in that. Which I think is so cool [laughs], that he is a Cornell chemistry professor. And he's this trained scientist. When you go on the Cornell website there's all this, you know... papers of all this chemistry stuff with his name on it.

But he has this – I don't know, call it a hobby of looking at all kinds of – you know, the Epstein, the Jeffrey Epstein affair and, you know, the connection between vaccines and autism. I just – all kinds of things. One after another. There’s all kinds of things. He listed a bunch of them on his Twitter feed just a moment ago before we started recording. And he said – he said, “Bring it. Let's go.” So he's in a mood on Twitter today. He wants to talk about all this stuff. And he mentioned things like Nickelodeon and Disney. I'm like, “What does he have on Nickelodeon and Disney?” You know, he's got something on everybody.

Corey McLaughlin:    Yeah. It's interesting too. Because, you know, like you said he's a professor at Cornell. I would say certainly, probably an outlier in terms of the political bent or just the way of speaking out on a college campus. So that's just fascinating on its own at this point in time, I think. But as you'll hear, he's not – he's definitely not shy about any opinion.

Dan Ferris:                 Yeah. I mean, think he's been around Cornell a long time. You know? So he's solid there. But I think he’s had his run-ins with the higher-ups at Cornell a time or two when we've talked with him in past interviews. So he's a controversial guy. And I love it. So get ready to not hear a whole lot about finance and hear controversial views about different, you know, non-financial topics today. That's what we're going to talk about. So I don't know. Let's do it, man. Let's talk with tenured Cornell University chemistry professor Dave Collum about anything but chemistry [laughs]. All right. Let's do it right now [music plays and stops].

Corey McLaughlin:    Gold has been on a tear recently, hitting new all-time highs and everyone seems to want in. Wholesale store Costco is selling out of its gold bars. Central banks are buying gold in record numbers, stacking it in their vaults on pallets. It’s even hitting overseas as China’s gold trading volume just hit a record 400%. You may be wondering if you've missed the window. “Is it too late to get in on the gains?”

My colleague and friend Dr. David "Doc" Eifrig says, "No, this gold mania is just getting started.” He cautions, “You don't want to go out and buy gold coins or mining stocks like everyone else.” Instead he found a much better way. You can get all the details at Goldmaniareport.com. That site will take you to Doc’s new free report that spells it all out for you. Get the facts yourself.

Go to goldmaniareport.com to read Doc’s free report and find out how to get his four simple steps you could take today for the best way to get in on this gold mania. [Music plays and stops] All right. David Collum, welcome back to the show. It's really good to see you again.

Dan Ferris:                 All right. Dave Collum, welcome back to the show. It’s really good to see you again.

David Collum:            Yeah, it's good to see you. Good to see you again.

Dan Ferris:                 I just had to look it up. Our last interview with you was May of 2021 and a few things have happened since then.

David Collum:            Just a few. Yep. Some minor stuff. Just some minor stuff.

Dan Ferris:                 But Dave, I have to pick up sort of where we left off. I don’t know if it was the last thing we talked about, but I know I asked you last time you were here, like, “What was your sort of new – new interest? What new topic were you sort of chasing down the rabbit hole?” And if I'm not very much mistaken, it was the relationship between autism and vaccines. And I'm wondering if you got anywhere with it. If you went – you know, if you kept after it.

David Collum:            Well, I have. I've actually – the movie Vax, the documentary Vax, was very good. And I have a friend who has an adult autistic child and he's a smart guy. You know, graduated at the University of Wisconsin. Levelheaded. He made reference to the vaccine and I – I knew the story but I said, “Tell me about that.” So what a lot of people don’t know about the autism-vaccine connection is, they think that they are – they think that basically you're raising your kid, they're not progressing at the rate you like, it's pretty clear they're not going to Harvard, and so you start looking for someone to blame.

That was sort of my view. I've read some 2-million-person study that said, “Look, It’s a done deal. There's no connection here.” And so, I was told – at that point I had faith in the FDA and I had faith in the scientific method and things like that. The movie Vax gets at a question that's far more acute. That is, that people whose kids get vaxed, that night they get sicker than hell, they get a spiking fever and the next day the kid is just gone. Just gone completely. They are now fully autistic.

And that's something that would be hard to confuse. Right? That's like drop a brick on your foot, it hurts. Do it again, it hurts. And there are thousands of people who tell exactly this story. “My son got sicker than crap and the next day they were not functional and they never came back. ” So this friend of mine made reference to the vax. Without me prodding it just popped out and I said, “Tell me about the vax.” He said, “Well, you know, my son got vaccinated and that night he got sicker than hell and the next day he was just intellectually missing.”

And he said, “I had to sit in a closet with him with mattresses on the wall so he could get to sleep without smacking his head against the wall.” You know, the community says, “Well, you know, there were symptoms. You just didn't see it.” Tell a parent that they don't see something coming like that. Right? That's just insane. Because we know every inch of that kid, right? We dote on them. If the kid goes from progressing at 18 months to not functional the next day it's over. Right?

The story is done. Right? And so, I told a student that one day and he went to the Mayo Clinic. So I said, “Well, there is such a thing as rapid onset autism.” And I go, “Did they explain it?” He said, “No.” And I said, “If it was the vaccine would they admit it?” And he said, “No.” And I said, “There you go.”

And so, I think there's a window of opportunity where if you get the vaccine at a certain age it's very dangerous. The MMR vaccine I think is – there's about a six-month window where you do not want to be giving that vaccine to your kid. And it's around 18 months. I'd look it up. I wouldn't depend on my recollection of the window but I – you know, in Europe they vaccinate the kids, they give 3 vaccines in childhood and in the U.S. they give them 72.

Dan Ferris:                 72?

David Collum:            Yeah, 72. I've been reading about vaccines before I got on to this story. And I had formulated the – I had been reading about immunology. I had been formulating the opinion that it's not good to invade a nubile immune system that aggressively with that many. Just bombarding them, carpet-bombing them, with antigens. Right? So I had come to the conclusion that the vaccines were being too aggressive. But not worse than that before I got into the whole vax story.

And then, I was watching a video – I was reading about immunology. Ironically, coincidentally the year before, COVID showed up. And I watched the woman give a talk on a Ted Talk. She talked about the polio vaccine and she said, “We've been vaccinating kids in Africa for, you know, 15 years.” What I’ll tell you is the live attenuated vaccine is much better than the dead vaccine.”

And then she explained it as the dead vaccine attenuates – the live vaccine attenuates a better immune response and it gives you sort of an immunity to other diseases as well. Which I couldn't quite understand. She said, “Look. None of these kids are dying of polio but the live vaccinated kids are not dying of other things as fast.” So she said, “Sort of the live vaccine is what you should get.” You can imagine a lawyer saying, “No, do the dead vaccine.” Right? You can imagine a reason.

And it took me probably three years into COVID, long after I realized that they were vaccinating everyone to death. It clicked... that's not the story. The story is the dead vaccine was hurting the immune system. And they were inferring that the live vaccine was imparting immunity to other things where the effects of the dead vaccine I think is probably eroding your immune system to these other ailments and you wouldn't be able to distinguish those two fauna. You just know one group died more than the other.

So I'm fairly comfortable stating that the vaccine did more damage than good. I understand why people did it. I did it. I didn't want to lose my job. They said, “You know, vax or quit.” And I had friends say, “You know, fight it. Fight it.” I was at a doc Zoom group with every anti-vaxxer on the planet . You name them, we’ve seen them through this doctors Zoom group.

And I said, “Look. When I got the vax it was a theory that it could hurt you.” And I knew it. I'd read about vaccines. There's whole books written on how hard it is to make a vaccine. That's been kept secret too, is that the army has tons of vaccines they can't use because it kills people. But it's like, “What do you say to your wife? You say, “Look. I'm not going to get vaccinated. Therefore, I'm going to lose my job” – and I'm a huge breadwinner compared to my two kids. One is a musician and the other is doing fine but I make more than the two combined.

And on a theory that I might be hurt by a vaccine…right? And so, you can imagine four years later, you know, the vaccines saved the world save the world and I'm jealous. Right? “How do you explain that to your wife?” Right? So I decided to go with the program. I said, “OK. Don't fight this one, Dave.” I waited. And there was no evidence surfacing that it was hurting people.

It turns out there was plenty and they just buried it. I think we’re going to have problems for decades, if not – we might have actually genetically engineered the entire human race at some level. It's gotten into our DNA I think. And the doc Zoom group smelled that early. They really had gotten into that. They had virologists. They had very smart people coming through. And so, that gets us to a deeper darker question as to why do people do stuff like that?” Right? “What motivates?”

And I don’t think its money, right? The guys that do this stuff, they don't need more money. These are not people working at the 711 trying to figure out how to double their pay. And so, it's about power, it's about ego, it's about sociopathy. Which is a minimum requirement to let these kinds of decisions to get made the way they get made. It gets in deeper and darker. I've dug into a – I’ve dug into Ukraine.

I'm about to watch Jeff Sachs be interviewed by Tucker Carlson. I'm a big Jeff Sachs fan. And Jeff was fighting a two-front war. Jeff was a famous, famous economist from Colombia who is geopolitically connected. So when the Soviet Union fell and we're seeing, “Sachs, what's going to happen? What's going to happen,” Sachs was the go-to guy. And I've had a few exchanges with them. And Sachs is honest, outspoken and oddly naive.

And so, I think he tends to believe things when people tell him. And so, he was simultaneously battling against the war in Ukraine while Chairing the committee to ascertain whether the COVID virus came from a lab. His committee had been stacked with guys like Peter Daszak and various players.

And he said it took him a calendar year to realize that Daszak and these guys were lying their asses off to him. Now, that's the naive part. I think people who are a little more doubting of human nature would say, “Wait a minute. Something’s not adding up with this guy Daszak.” I think Daszak should probably be tried for murder and hung from the neck until dead. I mean, there's a bunch of people who I would do that with. I think there are treasonous people all over the world.

Dan Ferris:                 Just for our listeners, can you give them a – can you give them The nutshell sort of description of who Daszak is?

David Collum:            Daszak is the guy who I believe created the virus. He certainly helped fund it. It's a bioweapons program. So in that sense maybe it's not treasonous because he worked for the U.S. government. But he was funneling hundreds of millions into Wuhan... Ralph Baric from North Carolina was part of the brains of the operation. The virus and the vaccine were known years before the epidemic. They were – you can track the vaccine and the virus back right through the patent literature.

David Martin, who's a very smart guy, has done – he's a patent expert and he's done his work on that. Every last anti-vaxxer that I know – and again, I can – I watched Johnson receive testimony in Senate hearings. I personally knew half the people testifying [laughs] by the time they got to the Senate. Right? So it really was a connected group. They all have gone from being doctors and virologists to anti-authoritarian new-world-order-opponent-type guys. They've all been super dark on the world that they're facing.

Dan Ferris:                 Wow. OK. So the answer is, yes, you have Looked into it further.

David Collum:            Yes, I have looked into it. I've written hundreds of pages on it. I mean, you know...

Dan Ferris:                 Oh, you have? Is that part of –

David Collum:            The annual review that I write.

Dan Ferris:                 OK.

David Collum:            And I've dug deeply, deeply into the Ukraine war and I nailed that. That might have been the best call I ever made. As soon as the war was brewing in Ukraine I dug in. And I was the guy who couldn't find Ukraine on a map. And I said, “OK. Let's figure this one out.” I found about 50 guys who were trying to really understand what was happening and why it was happening. And it's clear to me that the war in Ukraine is 100% NATO.

It's not Putin at all. It's not even close to Putin. It would be the equivalent of if we were blamed – if the Russians put a bunch of armed citizens in Mexico and we went in and flagged them and said, “Sorry, you can't do that.” For ten years Putin begged us, “Don't do this.” For ten years he said, “You can't have Ukraine.” They didn't want Ukraine. They couldn't let us get Ukraine.

For them Ukraine was everything. It was the gateway to Russia. Putin over and over and over told him, “You can’t have” – what did they do? They went for Ukraine. Why? I don't know. But if it causes World War III – if I'm wandering this dystopian world I'm going to find some of those guys and finish them off. I just – the things that they've done. 500,000 dead Ukrainians are our fault. And I'm a Reagan Republican. This is not some Lefty wussy stuff.

Dan Ferris:                 OK. So just to be clear on this, you're suggesting that – what are you saying exactly? That NATO wanted –

David Collum:            Wanted war.

Dan Ferris:                 Wanted war and –

David Collum:            NATO wants war. NATO wants war.

Dan Ferris:                 But Russia invaded Ukraine. Right?

David Collum:            Right.

Dan Ferris:                 So are you saying NATO somehow has provoked Russia –

David Collum:            He had to. It was his best play, by the way. So you go all the way back. The Soviet Union falls apart. We're negotiating with Russia, Germany’s talking about unifying. Everyone knows that unifying Germany has not worked well in the past.

Dan Ferris:                 Yeah [laughs].

David Collum:            Right? Two world wars with the unified Germany. Russia was really troubled by Germany. I'm not sure the rest of Europe wasn't also troubled. So we negotiate with Russia. We said, “Look. The Soviet Union falls apart, we're negotiating with Gorbachev.” Our high command all promised repeatedly, “Look. We won't move NATO into the Warsaw Pact countries if you don't try to take them back.” And Russia said, “Fine.” And then we immediately set in motion plans to move NATO into the Warsaw Pact.

The first move was under Clinton ‘97, and we moved – we’ve moved NATO's borders right to the edge of Russia and Russia just kept seeing, “You can't do this. You can't do this.” We kept doing it. We armed Nazis in Ukraine starting in 2012, I think it was, after tipping over a pro-Russian elected government. We tipped over the government, installed our guy. Then we started arming the Nazis.

Why? Well, it turns out they were the tough toughest bastards in Ukraine. We said, “Those are the guys we want to work with.” Now, I’m not calling them Nazis metaphorically. These are guys who are directly lineage of the Nazis who fought Russia during World War II. These are guys who celebrate famous Nazis’ birthdays. These are real Nazis. These are swastika-toting Nazis. Now, not a big number. Nor are the cartel heads in Mexico a big number. But we know what that does to Mexico.

So NATO and Lindsey Graham and John McCain, they all armed Ukraine. Putin kept saying, “You really have to stop this.” We didn’t. He pushed – we pushed him to the edge. All we had to say was, “Look. Here's the deal. We won't bring Ukraine into Russia,” and Putin would have said, “We won't therefore have to move troops into Russia.” He moved 50,000 troops into Russia. You couldn't take over in New York City with 50,000 troops.

Dan Ferris:                 Into Ukraine or to the border –

David Collum:            Ukraine, excuse me. Into Ukraine. In the Ukraine. It was a police force. Why? Because ethnic sort of Nazis had been slaughtering ethnic Russians in the eastern region of Ukraine for years. Estimated 15,000 slaughtered ethnic Russians in Ukraine. It was starting to pick up. Putin actually had to move fast because it was starting to pick up. We wanted Putin to invade because then we could say, “We got you.”

And then, what have we done? We've killed 500,000 Ukrainians. They have no men left to fight. Because we wanted a war with Russia. Zelenskyy tried to go to the negotiating table in March of 2022. Borscht Johnson shows up, “Don't even think about it.” Two things. One is, the money will start flowing into your pockets and, two, we'll pop your ass.” Very simple. So Zelenskyy said, “OK.” So Zelenskyy has continued to pretend to fight the war. the Ukrainians have lost the whole way. The one – they were periods where it looked like the Russians were not making good ground.

But that's because they underestimated NATO's willingness to get into it up to their asses. So then Putin said, “OK. If you want to play this way we can play” – Putin did not want to destroy Russia – Ukraine’s infrastructure. They did not want to kill Ukraine. The early footage of the Ukrainian war – I kept saying to my wife. This is what ticked me off. The early footage – I go, “This is not a war. You want to see a war, Go look at films of Baghdad Day one.”

Right? That's a war. That's what a modern war would look like. They were – look at Gaza Strip, Which, by the way, don’t get into. But go watch the Gaza Strip. Right? And those are wars. Russia moved basically the equivalent of UN troop-type men into Ukraine to try to get control of a problem. Now, the idea that Putin wants to take over all of Europe is a fabrication.

That's just western propaganda. Maybe he does. There's not a shred of evidence. He once said – the thing that gets used against him is, he once said, “The biggest disaster is when the Soviet Union collapsed.” It turns out the most famous cold war _____ in the United States, George Kennan, said the same thing.

We were negotiating with Gorbachev before it collapsed to try to keep it from going unstable. But then it – as collapses occur, as you know in equities, as you know in finance, once a collapse starts it tends to cascade. So George Kennan referred to us moving into NATO in ‘97. Now, he's the most famous Cold War [inaudible]. He said it was the biggest geopolitical policy disaster in U.S. history. So now we get told –

Dan Ferris:                 This is after the Soviet Union?

David Collum:            No, no. Us moving into – us moving NATO eastward.

Dan Ferris:                 I see.

David Collum:            The collapse was a disaster too, though, because it left a bunch of countries writerless. If it could have been done more systematically, sort of unwound like our banking system [laughs], things that – you know the story? You don’t unwind it systematically. You unwind it catastrophically. And so, Putin was accused of wanting to take over Europe saying because the Soviet Union was the biggest disaster.” What they leave off when they show that quote is the next sentence in which he said it left a bunch of countries right or less.

Dan Ferris:                 As is often the case. No matter how bad you think it is, whatever follows it is never great either.

David Collum:            Like revolutions. There’s one or two revolutions that ended up working out pretty well and the rest end up disasters.

Dan Ferris:                 Exactly. Yeah. Yeah. We hit the lottery in the United States on revolutions. We are the –

Dan Ferris:                 That's the one good one. That’s right.

Dan Ferris:                 We are the over-winning lottery winner. Yeah.

David Collum:            And by the way. Anyone who said they're thinking, “Oh, you’re not red blooded American,” America – I don't know if we were – if you read human history there's no such thing as the good guys. Right? It's brutal. It's brutal. I'm reading – I just finished reading Victor Davis Hansen's book on collapsed empires. But we – we've never supported democracies. We support existing democracies, because that's kind of the best play. Right?

You don't knock off Germany as a democratic state. Right? But as a geopolitical strategic move, it is a lot easier to control one guy wearing a white suit, sunglasses and a cigar hanging out of his mouth than to control a democracy. Democracies are awkward and ugly and inefficient, an And it’s the wisdom of crowds. But you don't get to control a democracy. We can bribe Noriega. We can bribe cartel heads.

We can say, “Look.” We'll bribe you by saying, “We're not going to cap your ass if you don't – if you’re not on our team.” Right? But we can't do it with democracy. There's a book called Overthrow by – I think it’s Stephen Kinzer. It's about 13 overthrows done by the United States. He said, “By the way. There's many more where the U.S. fingerprints are all over it. These are 13 where we went down and did it. We went over and did it.” And we don't install democracies. We never do.

Dan Ferris:                 That's dark [laughs].

David Collum:            It's very dark.

Dan Ferris:                 I’m not necessarily a – you know, an enormous fan of the idea of, you know, two wolves and a sheep voting on what's for lunch either.

David Collum:            [Laughs] That's exactly right. I like that one.

Dan Ferris:                 Yeah. But it's – you know, it's lesser of evils, is what it winds up being.

David Collum:            Oh, I support democracy.

Dan Ferris:                 Yeah.

David Collum:            I would like to see a popular vote instead of an electoral vote. There could be problems with it.

Dan Ferris:                 Sure.

David Collum:            I understand they put in the Electoral College. No. I support democracy. I just don't think we as a nation do. I don't know who's calling the shots. We've got Biden who – you know, I understand why people hate Trump. If you hate Trump and you want to run for Biden you must at least acknowledge that he doesn't have a marble left in his skull.

Dan Ferris:                 Right.

David Collum:            He is completely pathologic – and so, If you can admit that and say, “I’m choosing that over Trump” then I say, “OK.” So I get it. I'm stunned, because it's dangerous.

Dan Ferris:                 But is it really – I mean, is there any meaningful difference? Like, when I look at these candidates and I look back at the presidents during my lifetime, like Trump, Biden, Obama, Clinton, Bush, both bush’s... you know, Reagan and Carter, Ford, Nixon... whoever, I mean –

David Collum:            They're all part of the machine. They’re all part of a machine.

Dan Ferris:                 I'm of the belief that if you can be elected, if you can be elected president, there's no way you're the good guy for the job. There's no way. I mean it's –

David Collum:            I know. But here's the problem with Biden. And this is – and [inaudible] wrote about this and he’s dead right. “You need one guy at the top.” So imagine the Cuban Missile Crisis without Kennedy.

Dan Ferris:                 QQ. Yeah.

David Collum:            Imagine the upheaval – sitting around a table discussing and came up with a consensus of what to do without Kennedy there to say, “Here’s what we are going to do.”

Dan Ferris:                 Sure.

David Collum:            They would have started World War III. No question. Imagine – so here is the problem. I can look at every president going backward, including Trump, who would call the shot. Maybe – well, maybe poorly but he would call the shot. If you don't have a central leader where the buck stops at the top and he says, “OK. I've heard everything you guys have to say. Here's what we got to do,” you're in a very dangerous situation.

You are now being run by committee and committees don't work well.” So Biden is the first president where we don't know who's driving the cab. Obama could have called the shot. I'm confident that if Obama was presented with a do-or-die situation that the guy had the chops to do it. Bush Jr. I don't think was calling the shots. But I think Cheney had the chops to do it.

Dan Ferris:                 OK. So in other words, we're in the situation we're in – we have created... or it has been created – Somebody has created this large central power, which I would say is the primary problem. Getting your hands on that kind of power is just not anything that will turn out well over the long-term. Given that situation, though, you've got to have somebody who's all there. And Trump is more all there than Biden.

David Collum:            Oh, clearly. You can hate the decision you think he would make. But we actually have four years of Trump and four years of Biden. I've got to tell you, I don’t think you have to be a MAGA guy to notice that Trump is – when I pulled the lever on Trump – I mean, was such an idiosyncratic character. Right? And when I pulled the lever on trump with hands shaking [laughs] – this guy is a wackadoodle – there was one central issue that allowed me to say I'm going with Trump.

And that is, I believe he would not get us in wars. I believed he would negotiate. And he didn't get us in wars. I don't like some of the things he did. I don't blame him for things he didn't achieve because he was in a constant battle the whole way. A constant battle without a political machine backing it up.

Dan Ferris:                 Just to stay in office. Yeah, just to stay in office. Just to stay in office. That's right.

David Collum:            Just to stay in – but the Russia collusion, which I called early... I wrote about that – that was clearly a farce. But the problem is, you can see Republicans who sort of pretend to be with him. I bet you wouldn't be willing to name one you'd say, “I would bet my life they have his back.”

Dan Ferris:                 Yeah. No.

David Collum:            Maybe Marjorie Taylor Green. Maybe someone like that. But you'd be hard pressed to name one who wouldn't switch teams fast.

Dan Ferris:                 So not generally The so-called Freedom Caucus, the – I forget who they all are. Matt Gaetz.

Dan Ferris:                 Gaetz is a maybe. You know, but these are minor players. It's just like the Tea Party, right? They get absorbed back into the system. I was going to say get outside the system. And so, I don't think we can elect our way out of this. I do think I'd rather have Trump in there than Biden. And here’s my optimism on Trump. He knows where the spoons and the forks are now. Right?

He went into office. He didn't think he was going to win. He wasn't ready – you know, there's a law that says you are by law required to prepare for the presidency if you are in the running. And the reason I think that law was passed is so that people had the political cover to prepare a cabinet and prepare for the presidency without being accused of being presumptuous. And Trump – Trump couldn't trust anyone. Which ended up being himself to surround himself with family.

And that was a very weak cabinet because no one's going to tell Donald what to do. Right? No one's going to stand up to him. He had Bannon. Bannon was solid I think. But now he knows – I think he probably knows who he can trust. I also think – the phrase I invented, I believe, is he’s weaponized narcissism. He used to want his name on every building. I think he realizes the ultimate is to be a great president. And I think he now realizes to be a great president he has to do great things.

Dan Ferris:                 Yeah. Great. I would say – I would say great in quotes [laughs].

David Collum:            Well, what he perceives to be great. Well, but for example. Get control of the immigration. He now knows he has to get control of the immigration. He now knows he has to get us out of wars. He would get us out of Ukraine. We wouldn't be –

Dan Ferris:                 That is one thing that I truly believe. Yeah. I do believe that about him.

David Collum:            We wouldn't have been in Ukraine. We wouldn't have been there. Wouldn't have been in Ukraine if he was president.

Dan Ferris:                 Right. No.

Corey McLaughlin:    It’s certainly coming from the narcissism. This will be – I think – you know, I think a lot of people are kind of thinking the same way. Like, and they may not be saying it but, you know, breaking that down these two guys, like, you know, it's –

David Collum:            So do you think Trump – do you think Trump is patriotic?

Dan Ferris:                 To a fault. Yeah. Absolutely. I think he loves this country –

David Collum:            Do you think Biden is? Do you think Biden is?

Dan Ferris:                 You know, That’s dicey. I don't think –

David Collum:            Zero. Zero.

Dan Ferris:                 I don't think he's patriotic. I see him as part of a movement that wants to dismantle the real key core values that make America –

David Collum:            Well, that's not patriotic, right? It's not patriotic then. So that's a zero. Right? So then the question becomes “Why? Why – does it bother you that you see things happening all over the world that don't makes sense at the most fundamental level?” Like for example, leaving the border open. There is no case for border open.

Dan Ferris:                 There's certainly no case for leaving the border open and running a massive welfare state at the same time.

David Collum:            That's right. That's right. And by the way. [Crosstalk] I’ve had chats with ex-border guards. They say, “We used to stop people at the border who were risky. We used to be able to control the flow.” And he says – he said, “They're letting so many guys through who are so dangerous.” What odds do you put on it that at some point in our future, a bunch of characters who came across that border do some serious terrorism? What odds do you put on that?

Dan Ferris:                 I think it's a certainty. Look. It's a certainty. We know – it’s like a suitcase bomb certainty. We know it's a certainty. You know? At some point somebody is going to set off a suitcase bomb and some major city. It's going to happen.

David Collum:            So leaving the border open then is treasonous.

Dan Ferris:                 Yeah. I mean –

David Collum:            I don't know what the definition of treason is.

Dan Ferris:                 I don't either. But to do all this – to have all this conversation I'm accepting a whole context that I don't normally operate in. Normally my point is, if you follow me on Twitter you know I'm just like, “The problem is the existence of – the size. This sheer size and scope of this amount of centralized power.” That’s the problem, and it all stems from there. And, you know, God bless him if Trump were to make – take one step forward in the right direction, God bless him for it. But in the end do I believe that, you know, the government will shrink, that that power will shrink at all under his, you know, time as president?

David Collum:            No, it won't. No, it won't. It won't. So that gets to the question of, therefore, “Are we headed off a cliff?”

Dan Ferris:                 Well, we're headed the way of all empires. We're headed the way of all empires.

David Collum:            OK. Let me ask you. Are we going to be alive to witness it?

Dan Ferris:                 OK. That is a better question, isn't it? I'm 62. And –

David Collum:            I’m 69.

Dan Ferris:                 Yeah. So same ballpark. And, you know, I have got pretty good genetic material. Dad was 96, mom was 93. I think, you know, things – by the time I'm ready to kiss it all goodbye I think things could be really a lot different and a lot worse.

David Collum:            Do you think we'll be better off in ten years from now?

Dan Ferris:                 You know, that's a great question, Dave. Because I think my standard of living will be higher. I really do. My standard have living has just –

David Collum:            Is that because of you though? What about the average standard of living within the United States?

David Collum:            OK. Within the United States is a different question. Globally it's absolutely unequivocally higher. I mean, there are fewer people as a percent of the population in what we would call dire poverty. Right? It used to be most of it and now it’s not.

David Collum:            So let me give you my 40-year bear market case then.

Dan Ferris:                 OK. This is a different question for me, and I'm probably there –

Corey McLaughlin:    This is new for me, by the way.

Dan Ferris:                 Yeah. [Laughs] yes, it is. If you press me I'll say, like, you know, A 30-year sideways market ala Japan – I've been talking about this three years solidly. But go ahead. Your 40-year bear market.

David Collum:            Then the country won't – the country won't be better off.

Dan Ferris:                 I don't think the – yeah. I don't think the country will be better off. You see, we're talking about country and government and standards of living and I – it's hard for me to generalize to that degree about something so large and complex as the lives of hundreds of millions of people over a great area. But I get the point. Do I think the government will be –

David Collum:            So here’s the Rubicon I’ve crossed. Not just the government but quality of life. And the Rubicon I’ve crossed is I think I was able to stand back and look at the various catastrophes and the bizarre behaviors and stuff like that. And I had this great faith that I, Mister Smarty-pants, would somehow be able to stay above it. And I no longer think that. I'm not convinced I know how to stay out of – out of the shooting range.

And so, I think just inflation alone is going to be so hard to fight. And you can say, “Well, you know, I'm going to hedge against it.” When you’re hedging on something like inflation you've got to be really good at it. You've got to be really good at it. And so, the 40-year bear market – in 1981, this is a combination of ideas from a combination of people including some of my own. In 1981 we were demographically on the cusp of greatness.

The Boomers were just really starting to pick up speed. They brought their wives to the workplace. We cranked demographically. The economists all say that's the whole ball game. It's not the whole ball game but it's a big part of the story, if you’ve got a young productive population.

In 1981 from the price earnings ratio – which they're so crooked they're ridiculous but let's just pretend like it's real. In ‘81 it might have been real... was 6 on the market. The bond market was priced terribly. The stock market was priced terribly. In 1981, China was coming out of the dark ages. And for the next 40 years sold goods made by slave labor at the cheapest imaginable price.

In 1981 Russia – the Soviet Union had not yet collapsed. But we were already helping them get resources out of the ground and flood the world with Russian resources in other countries and things like that. So there was this sort of resource boom that left oil dirt cheap 20 years later. During that period the market valuations climbed. In 1981 interest rates at 16% over the next 40 years dropped to zero. Which is insanity. You know? Edward Chancellor says if you get below 2% you will have a crisis.

We got to 0. Europe, they got negative – ridiculous. And negative real interest rates. Seriously negative real interest rates. So we had tailwind after tailwind after tailwind after tailwind. Which of those tailwinds could possibly repeat over the next 40 years? The answer is none. None. We will not find another China to do what it did. We will not find interest rates going from 16 to zero.

By the way. Buffett, who gets misinterpreted, misquoted all the time, ran a 1999 fortune article that basically said, “Everything is about interest rates.” He said, “If you look at the bear market from ‘67 to ‘81, rates were going up. If you look at the bull market from ‘81 to ‘99 rates were going down.” He said, “the GDP – real GDP from ‘67 to ’81 – grew faster than the GDP from ‘81 to ’99.” It’s not the GDP. I've read that article about eight times. He says, “Dropping rates are bullish.”

What the market turned that into was, “Low rates are bullish.” No. Low rates are bearish because there's nowhere to go but up. So are we at the end of a 40-year credit cycle? And the answer is probably yes. We sure as heck are not the beginning of a 40-year interest rate drop. That we know. And so, then the question with all those repeating what happened – with all those working together – the valuations of the market... which I know you know but I'm going to say it in case your audience doesn't know it completely.

The valuations of the market is not the price of the market. It's the price of the market divided by a metric that the market ought to track. Whether it's earnings, revenue, book value, Tobin’s Q. I follow about 25 of them. The market valuation should flutter around. And from 1880 to 1990, they just wobble back and forth and back and forth and back and forth and gave an average market valuation – well defined.

In about 1994 – and the question is why in ‘94 the valuations took off. From 1981 they were already overvalued. The market was already overvalued in ‘94. It was about 50% overvalued in ‘94. But they left the zone in ‘94. They broke out of this 110-year – this 110-year [inaudible] sort of zone and took off, never to look back. You say, “Oh yes, they look back.” In 2009 at the low the market spent about one month below historic average fair value. About a month.

That's not a deep correction at all. That's regressing to the mean, not through the mean. So during that 40-year period, the market valuations – which should move... they should move around but there should be no trend – compounded 3% a year. That's a 3% tailwind which will at some point turn into a 3% headwind when they compound a negative-3% a year to get back to cheap. Now, someone would say, “Well, they'll never get cheap again.” Oh please. Name an asset class that got expensive that didn't regress back through the mean. And the answer is there are none.

.David Collum:           Right. And E –

David Collum:            Never happened in history. Never happened in history.

Dan Ferris:                 The E and the P/E, As Grantham likes to say, is the most mean-reverting series in finance. And it's –

David Collum:            And profit margins are the most mean-reverting – well, Nvidia is – Nvidia is [laughs] – now I think it's going to soon start to be called the MAG 1 because it's ruling the entire market, Nvidia.

Corey McLaughlin:    Yeah, I think we're there [laughs].

David Collum:            Has a P/E of – has a P/E of 100 and has a profit margin of around 85%. Now, that will mean revert because competition will show up and AI – I'm not convinced AI is good news. I can see advantages to AI but I can see the disadvantages That could far outweigh the advantages. And so, I'm not a big fan of AI at all.

Dan Ferris:                 Well, and just – I have no reason to believe it's not like any other new technology. I have no reason to believe that, you know, it's not essentially – we're at manic levels about it here. When, you know –

David Collum:            But the Internet looked great. The Internet looked great.

Dan Ferris:                 It did, and it was, and it is. But, you know, there was still a huge bear market [laughs] And most of those –

David Collum:            AI doesn't look great to me. AI doesn't look great to me.

Dan Ferris:                 Oh, I see. AI does not look overall – it doesn't look anything like the Internet to you?

David Collum:            No. No. I think it's a great risk of filling the great Internet with total debris. Total debris.

Dan Ferris:                 Right.

David Collum:            When AI starts scraping AI, you start getting nonsense but you start thinking total nonsense. You know, would you be happy if you never, ever, ever saw another AI-generated piece of art?

David Collum:            Yes.

Dan Ferris:                 Every article has AI art in it because people were too lazy to actually create. So AI is at a great risk of taking the whole human element out of everything.

Dan Ferris:                 Is it really though? Can it really?

David Collum:            It is.

Dan Ferris:                 I don't know – I don’t think that I agree that you can ever remove that element. It's similar to – there's this sci-fi series called 3 Body Problem. And at some point –

David Collum:            I'm watching it right now.

Dan Ferris:                 OK.

David Collum:            For the second time.

Dan Ferris:                 OK. Let's see I'm going to spoil it for you. But – oh, for the second time. OK, no speller then.

David Collum:            No spoiler, second time.

Dan Ferris:                 At one point lead in the first season in which I think there's only one season at this point... late in the season somebody says, “You know something? These aliens know everything about us because they’re watching everything we do”–

David Collum:            But we have our head.

Dan Ferris:                 We have what's in our head. Right?

David Collum:            I know. I know.

Dan Ferris:                 They can't get in there. That’s our one thing. You know? And I don't think –

David Collum:            Let me point out – let me point out that people across the Soviet Union knew that it was bad. Knew that the leadership was bad, and it still lasted 70 years.

Dan Ferris:                 Right. Right.

David Collum:            So just because you know – because you know it doesn't mean it isn't going to suck. There's a name for it where you – where you reach a point where you just concede that you can't fix it. There's an actual name for that and I can't remember what it was but there's a point where you just reach where it's just this fatality. You accept your doom. And that's what you have –

Corey McLaughlin:    With AI at something I've been thinking about too, with just creating, you know – like content or research or whatever. And I don't think – the ability for original thought doesn't go away but it seems like AI amplifies whatever is out there first or the most popular.

Dan Ferris:                 So far, Dave, the generative AI output – if you ask it to write anything, it's sh-t. It's crap.

David Collum:            I know. Unless you're reading stuff you don't know is AI.

Dan Ferris:                 Well, I guess –

David Collum:            There's a bit – on Twitter there's a tweet today where it shows this chick, and the person asks, “Is she fat?” And she looked phenomenal. But she's got these massive hips. And you're going, “Holy sh-t. She's, like, hot from waist up and then these massive” – and I'm going, “Oh, she's so out of proportion.” And someone said, “That’s an AI fake.” The human creative spirit could be drowned by the debris. When I search the scientific literature I can't find stuff now. I can't find it.

Dan Ferris:                 Yeah.

David Collum:            And the scientific literature isn't using AI to clutter stuff. It's just getting more and more cluttered.

Dan Ferris:                 So maybe we'll live less in our lives or try to live less of our lives online then.

David Collum:            That's true.

Dan Ferris:                 Maybe we'll get out and see the world – maybe we'll touch grass as the saying goes.

David Collum:            But you've got guys who say with AI we don’t need to vote because AI can predict who’s going to win anyways. And, boy, these are Rubicon’s. Right? These are Rubicon’s. And then, the other deep, dark, dark, dark place – I hit a darker place last week than I've ever hit, actually. But I’m chasing the pedophile story. The Epstein – went below the surface. So everyone knows Jeffrey Epstein was working for Mossad, probably CIA, blackmailing the hell out of him.

So if you want to know why we're leaving the border open, you want to know why we're sending money to Ukraine, all you have to do is say, “Who's compromised?” And the answer is clearly Biden. Right? The minute you are married and you're in Congress and you have sex with some bimbo, you're compromised and the next thing you know you're more compromised.

And pretty soon you just can't not do what – and then even if you're not compromised your best friend says, “By the way, they're going to put out a picture of me with a five-year-old in bed if you don't vote this way. You can't do this to me.” Right? So I think all of politics is compromised. But I look at people do things that seemed to be so against the most fundamental principles of the United States. And I ask, “Why? What black hole force out there in the universe is drawing out these kinds of actions?”

Dan Ferris:                 I don't need them to be compromised to, with that, Dave. I mean, come on. If somebody comes to the country from, you know, wherever half of them are from now and gets elected to Congress and has a whole different set of values and a whole different, you know, religion that a lot of folks in the country don't have or a philosophy that a lot of the folks in the country don't have – I don’t need to be compromised to get there.

Dan Ferris:                 Right. But you can look at the people in Congress now who don't fit that description who look compromised. They support things that don't make sense. And so, one of my theses is that this global pedophile ring is way darker and deeper than Epstein. Now, let me give you some stats that seem uncontested. They say that over a million kids a year are trafficked. Right? That's a big ass number. Let's say it's an exaggeration. Let’s say it’s only 500,000. That's 500,000 kids a year who are trafficked. Have you ever seen anything about who's receiving these children?

Dan Ferris:                 No. No.

David Collum:            Can you name – they're not going to trailer parks. Guys and trailer parks can't afford trafficked children. These are not guys with vans with free candy painted on the side. So it turns out when you dig into this world you find some unbelievably bizarre stuff. You'll find, like – you'll find yourself in a Zoom call with Archbishop [inaudible] who's actually spilled his guts in the Catholic Church, saying that the leaders of the world are all compromised by pedophilia. Personally in a Zoom call.

You'll find that I'm on a Zoom call with the Department of Defense case officer, intel case officer, who I’m fact-checking all the way, two hours in the Zoom call fact-checking and making sure this guy is not bullsh-tting. He's not bullsh-tting, he's real and I've gotten even more information about him. And I communicate with him casually. And at the very end of the call I say, “I'm interested in the role of pedophilia in geopolitics, Tony.”

And Tony says – He starts talking about Epstein. I said, “No, I don't care about Epstein. We all kind of understand it and it's a profound problem.” Right? Clinton was compromised. Also, Barack was compromised. They were all compromised. And we've just kind of gotten by that somehow. But I said, “I'm interested in the darker stuff that no one's talking about.” And I said, “Let me ask you a simple question. Is the Clinton Foundation trafficking children?”

And he said, “Oh, absolutely.” Now, how many people listening to this call didn't just soil their underwear? No, I know for a fact the Clinton Foundation is trafficking children. I knew it. But when he said absolutely, I just said, “OK.” That was almost a test for him. So then one day I'm talking to this guy – on Twitter I put something out about him, and some guy jumped in and started hammering him. And they go back and forth, and they're throwing grenades at each other on Twitter.

And I go, “What did I just trigger here?” And it was a journalist of some kind. And so, I DMed this guy, this intel guy – I have several intel connections on Twitter that people don't even know who they are. And I've had lunch with them and stuff like that [laughs]. And I said, “Sorry to drag you into that. You guys obviously have a history.” He said, “Yeah, it was about Bowe Bergdahl.”

Do you know Bergdahl, the guy who walked off the base and joined the Taliban? And then we lost the Navy seals trying to retrieve him and “Was he a spy, was he a traitor” – , very scandalous thing. And I said, “ Sorry to do this to you.” He said, “Oh, he's pissed off. He wants more information out of me. He was trying to get me to spill some more guts because he knows I know stuff he doesn't know and he wants it bad.” And he says, “What he doesn't know is, I was the lead negotiator trying to get Bergdahl out of that goddamn territory.”

And I'm sitting there going, “Holy sh-t.” So when he said yes to the Clinton Foundation traffics famous... famous people traffic children. A million kids are getting trafficked. And until you can tell me where those million kids are going, you haven't begun to understand that problem. And what I'll tell you is, there is some famous scandals that got out of control that are kind of Rosetta stones to this story. Like, one is called the Franklin scandal. Highly connected republican operative. The whole thing unfolded.

What's instructive about it is, a bunch of these kids as adults came out and spilled their guts. These are fractured personalities. These are people who are – they're crackheads, they're prostitutes. They're multiple personalities. Some of them have pieced their lives back together but they spilled their guts. And concerned citizens hired a private investigator. “Who died in the plane crash?” Right?

That sort of thing. But the story unraveled. What was telling was, the FBI came in and squashed it like a bug. The courts – one of the women ended up in the Nebraska Supreme Court on her case. The judge who was put in charge was not legally – he was not allowed to be a Supreme Court Justice. They put him in there anyways. Between the prosecutor and the judge they destroyed the case. It's a real, unbelievably telling story. What it showed you was, when one of these cases really is at risk of going public, the firepower that is brought to bear to shut it down is unbelievable.

Dan Ferris:                 Yeah. I wouldn't doubt it. All right. Well, on that dark, dark note I'm going to ask you –

David Collum:            There's a darker one. There's a darker one. the darker one is the poles are moving quickly. The magnetic poles are moving quickly.

Dan Ferris:                 Really?

David Collum:            When the poles move – every 6,000 years, they move. Every other 6,000 years when they move you get – the magnetic field protects us from solar radiation. When the poles reverse we are unprotected. And they're moving fast now. They're moving fast – in our lifetime fast.

Dan Ferris:                 Wow. I haven't heard a syllable about that.

David Collum:            So I had heard about it but I hadn't paid attention. But, you know they had that aurora borealis sh-t last week, unprocessed or... ? There's a reason we got unprecedented aurora borealis. And when the poles move the magnetic field doesn't shield us from the cosmic rays that hit the earth.

And the worst of it known to humans so far occurred in 1859. It's called the Carrington Event, where we got a burst sunspot. It fried the entire telegraph system. Fried it. The telegraph systems was probably quarter-inch copper back then. Our micro circuitry will be scorched. If that happens. If that happens.

Dan Ferris:                 All right. Now we'll have no choice but to touch grass because that's all that will be left, if that. So on that awesome note –

David Collum:            We’ll all starve actually.

Dan Ferris:                 Yeah. [Laughs] On that dark note I do want to actually ask you my final question, which is the same for every guest. Even when we don't talk about finance so much. Like in this interview. And it's – you've answered it before. I hope you don't remember it, because it works better that way. But the final question is – and if you said it already, feel free to repeat it. That's the other thing. You don’t have to make up something if you’ve already said that. And the question is simply, “If you could leave our listeners the single thought today what would you like it to be?”

David Collum:            It's age dependent. It’s age dependent. If you're young, if you're in your 20s, don't go down these deep rabbit holes. You have to build a life, you have to build robots, you have to do all sorts of cool stuff. If you go down these rabbit holes you'll have trouble coping. If I went down these rabbit holes I go down when I was 25 years old I would not have achieved what I achieved.

So don't go down these rabbit holes. Let the old guys hike up their pants to their chest and bitch about the government. You go do your thing. To the same young group, you save for retirement, you invest to hedge inflation. Don't think you're going to – don't think you're going to get rich by – you have to save. And I even saved – net savings, the years my kids were in college. And I saved, crudely speaking, probably 25% of my gross salary.

Dan Ferris:                 Wow.

David Collum:            And that's how you get to retirement safely. Don’t use college savings plans. I understand how college financial aid works. The goal is to look broke when your kids get to college age. If you have these college saving plans you don't look broke. In fact, your best bet is to give all your money to your parents and have them give it back later. That would make you look broke.

Dan Ferris:                 There you go [laughs].

David Collum:            And then to the older people, Gad Saad said it. There's a lot of things that really trouble you but you don't want to say anything because you have your reason. “Because I'll be criticized, I'll be this, I'll be that, I'll be fired or whatever. He said, “Find a way to speak up. Don't be a coward.” He has to go around the country with an armed guard. His wife walks five feet behind him, watching for trouble. She just watches him. She watches – walks behind him.

And he says, “If I do this you can speak up.” So if you see a wrong – one thing I've never – for some reason I'm a natural contrarian. I've never been afraid to be against the crowd. In fact, I relish it for some reason. So when I write, I write about stories for which the crowd is all going one way and I think the story might be the other way. Don't be afraid to be alone yelling in the forest. Don't be afraid to speak up.

And I didn't do it but, you know, two days ago, POTUS put out this teary-eyed thing about how George Floyd's life was snuffed in its early stages and we lost so much. And I go, “George Floyd was one of the skankiest bastards on the planet. Shut up.” Right? And at my age I can do this. On a campus you say, “Wow. If someone gets ahold of this I'm in trouble.” Screw you. I'm fighting to the death on this one.

Right? You want to cancel me, we're going to war. We are going to war.” They've tried. They've tried multiple times. The next one is going to be ugly. Unless I reach out to Cornell and say, “Hey. If you shut up and I shut up this will go away. Are you OK with that?” And if Cornell is willing to just shut up then I can just shut up. But if Cornell comes out and again denounce is what I said, then I’m going to war with these bastards and I'm going to make a freaking steak. And I don't know what topic it'll be. Someone will get their underwear in a knot.

Speak up. I understand why you don’t want to lose your job. I get vaxed, I didn't want to lose my job. Risk-reward calculations are everywhere. But find a way. Speak up with your friends. Just talk to them about how you think climate change is the biggest grift in the history of the world – in the history of the world. And I know science. That is not science that you're witnessing. It's crap. And so, dig into these things but don't do it if you're a youngster, because you've got kids to raise and families to feed. Just do your thing.

Dan Ferris:                 Well said, Dave. As always. It's always a pleasure to talk with you. The conversations resemble nothing like any of our other guests, which I absolutely love. I mean, we’re always talking to money managers – you know, it's a financial show. But, you know, there aren't many people who I want to get into these subjects with. in fact, I can only name one and you're it [laughs]. So thank you very much.

David Collum:            Thank you [music plays and stops].

Dan Ferris:                 Well, I know it wasn't really about finance but it was a hell of a lot of fun. You have to admit that, right?

Corey McLaughlin:    It was something. That's for sure. Yeah, it was – yes. Yeah. No. I mean, he had a lot of – obviously there was a lot there. We got into finance a little bit, right?

Dan Ferris:                 We did a little bit. And I just want the listener to know, like, normally I’d move past these topics if they come up. I just don't let people talk about them. But I know Dave's method, and I know they're kind of work he does. And if you've ever read his phenomenal year-end review document that he puts out at the end of every year you know that he digs and digs and digs and it's full of, like, real sources. And, you know, like he said he's having lunch and meeting with the Secretary of Defense and people like that.

So, you know, I kind of take it – I wouldn't say on faith but I am assuming that a guy like that has better sources and better information and isn't just sort of parroting what his TV box told him or what his Internet told him. So that's why we have Dave on talking about all this non-financial stuff. You know, if it's not for you I get it. We hardly ever do it, but I love Dave to death, I think he's a brilliant guy and we just got to talk to him at least once a year. We should talk to him more often I think.

Corey McLaughlin:    His point about – I mean, pretty much everything he said gets to the point about, like, there's a lot more to what's out there than, like, what's public information. I think that, like, theme is I think a good one no matter what you think about anything. And as that pertains to investing, you know, just preparing for – oddly enough we got to a point where we were talking about, like, the reversing interest rate theme again.

And inflation I think is an important one. I also loved his last point there about the difference – you know, if you're a younger person like I am, keep your head down and just focus on what you want to do [laughs] and let the older generation and him be all cranky. So I enjoyed that perspective too, right there at the end.

Dan Ferris:                 Yes. Very smart. I'm really glad he said that, because it's true. You know? You can get sidetracked. I'm pretty sure – I wouldn't say I followed the person I'm thinking of for many years. But as a younger guy there are some folks I knew. And, you know, we all had the sort of potential with the ideas we were thinking up when I was, like, an older teenager in my 20s. And I would bet that one of my old crew probably went down the rabbit hole and didn't do much with their lives. We all had that potential [laughs].

And I got dangerously close myself. And finally in my 30s I said, “You know something? You should probably get a job.” So that's great advice. I thank him for that. And, you know, it's just exactly the sort of wisdom that I would expect from him. He knows what he's doing. He knows who he is, he knows what he’s doing, he knows what he's paying for it and what he's paid for it. So that's great.

But as an analogy you actually just started to say this, Corey, and I agree with you. As an analogy the fact that, you know, what you get on the surface or in the news or as an investor in press releases and announcements and financial headlines – you know, to say it scrapes the surface is an understatement. It barely gets you anywhere. It's where your analysis may begin in some instances, but there's so much more under the surface if you want to understand a particular business or a particular industry.

And what you learn will always – like, every single time it's true, and this goes another things too. What you learn will always be the exact opposite of what you started out with. much of it. You know? And that even goes to things like – I talked with a particular billionaire in finance at one point who had read my newsletter and said, “You know, you should be managing money.” And he told me things and he gave me some advice.

And as I sort of had gone through the process, started getting through the process, I'm like, “Everything he told me is exactly the opposite of what I've learned.” And this is somebody who should know. He's a freaking billionaire. A billionaire in the finance world. You know? He should have known everything. Right? And it's just that it didn't apply to me. You know? It didn't apply to what I wanted to do. So that's how you should think of financial research. Whatever you hear in the headlines, don't take it for granted.

You either – you know when you know a business inside and out and you should know when you don't know one. And Dave knows his topics inside-out because he just goes down those rabbit holes, like he said. You know? And he doesn't stop and he meets all the folks involved on, you know, all sides and has real, you know, frank conversations and exchanges with people who know what he wants to know. And that's how that's how investing is done. That's how real investing is done. So if nothing else, I think that's a lesson for today [laughs]. You know, if these topics don't actually mean anything to you let it mean that.

Corey McLaughlin:    Well said.

Dan Ferris:                 There we go. So that's another interview. Another really super fun interview, I have to say. I could have talked to him for another hour or so. So let's Corey and I Sort of get back on track and talk about what is interesting financially and economically in the world today. So let’s do that right now. [Music plays and then stops] The Fed wants you to believe they've got inflation under control. But I believe we've only seen the beginning of a devastating new crisis.

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[Music plays and stops] Well, I hope you enjoyed our talk with David Collum. He's obviously a brilliant guy. And, you know, if some of that was just sort of a little bit out there for you, I understand. The first couple of times I talked with him it was that way for me too. But I don't know. Dave has me thinking more seriously about all these topics and wanting to know real hardcore facts about them. And that's always a good thing, right? We want to know the truth. We want to get to the real truth. So Corey, my friend, we need – there's something we must talk about because the data just came out.

And that of course is the personal consumption expenditures. So PCE, the federal reserve’s favored method of measuring inflation. And one might think the numbers are a little bit low but they are consistent, aren't they? The so-called core PCE excluding food and energy has consistently been the annualized rate of 2.8% for the last three times, and it was 2.9% for the two times before that. So it's kind of riding along sideways here, isn't it? It's consistent.

Corey McLaughlin:    Yeah, I think so. Because I just saw a couple headlines, you know, authors immediately saying, “Inflation is easing and it's in line with expectations.” And I actually bring up the numbers myself and look at it and the PCE is 0.3% growth for the month of April and, excluding food and energy point 0.2% for the month of April. So if you go by that headline number, 0.3 – I mean, that's still – that is a pace.

You know, just you quickly annualize all those numbers for above 2%, closer to 3 or 4% at the rate it's been on the last – since the start of the year. So to me it's not a significant deviation from the trend. It's not worse than it's been but it's not really too much better either. So yeah. It's more of – I think it's more the same. Like, you know, the inflation is still high higher than a lot of people thought at this point it would be. And it's kind of the status quo as far as I can see it.

Dan Ferris:                 Yeah. It's still – like, it's still true. We said this in a previous podcast. It's still true that the lows of this episode post, you know, like – call it post-2021 or post-2020 – lows of this episode are higher than the inflation highs measured by CPI and PCE before, let's say, the pandemic. Right? And so, we are still in a regime of higher inflation. I hate to say it's a new era but, you know, it's an era of higher inflation [laughs].

So they happen from time to time and we are in one still. So here's a question for you. With things like, you know, food and rent and all these important parts of life – insurance – stuff you've got to buy – up double-digits, how meaningful is like a 2.8%, you know, PCE – you know, PCE and CPI in this – just call it 3 to 4%-ish neighborhood. How important is that to you?

Corey McLaughlin:    Personally, these numbers, not at all. You know? You know, whether they're 2%, 3%, any person looking at that and hearing – and I get feedback on this all the time when I quote these numbers. It's like, “Well, my insurance was up 80% since last year.” I am like, “Well, OK. Yes. I understand.” McDonald's just came out and published how much all their food has gone up over the past three years.

Dan Ferris:                 Yes.

Corey McLaughlin:    And literally everything, every meaningful thing, is up 20%. You know? My favorite cheeseburger is up 20%. While still tasty and unhealthy relatively speaking for you, it's up 20% and I will still buy them. But when you look at PCE 2%, 3 – CPI 3, 3.5%, I think it is, that's what was on my mind too... I was just going to say.

You know, we’re entering the meat of the political runup to November’s election. And there's a lot of conversation around that right now. And still, I think what gets lost a lot is the effect that inflation has on – has and is having on people. And still feel like their wages aren't – their paychecks aren't keeping up with prices, which they aren't. So when somebody hears 2% and, you know, “We got inflation down from 9% to 2%” – well, first of all it was not at 2%.

And, you know, by most people's measures – it’s different for everybody. And it doesn’t change I think the sentiment out there of just how expensive things are for people. It's just... I don't... but again. For the market [laughs] the fed is not necessarily rooted in reality. So they are looking at these numbers for better or worse, and that's what I was talking about.

Dan Ferris:                 Yeah. That’s right. These are the published numbers, so we start there. I can't emphasize that enough. I've said this about, you know, assessing individual companies and economies and economic data and just about anything. You start with the published data. You don't end there. You start there. That's where your analysis begins, not where it ends.

And just as you were speaking I just grabbed a quick five-year chart of the CPI index itself, not the year-over-year changes which is the chart most people publish but the actual index. Which is up 23%, 22.73% over the last five years. Even that, like, I know some stuff – plenty of stuff in the last five years has doubled and it's up much bigger double-digit rates than that.

So it's – I don't know. At some point you have to believe that, like, reality means something. Right? Doesn’t reality mean something? Like, at what point do – at what point – for example. Here's a good example. We'll take ourselves. At what point do Dan and Corey just stop talking about PCE and CPI and just manufacture our own real index or get our own real way of measuring inflation, whatever it may be” – maybe it's just existing already and we just adopted it for our own – “and just start talking about that and then we just make fun of CPI and CPE all the rest of the time?”

We just say, “Oh, you know, we don't pay attention to that anymore because it's not real.” I don't know. I feel like I'm just about there. And I tell you. Talking with Dave Collum, it always changes me a little bit. And so, now I knew we would have to be talking about PCE data today because it just came out and that's what you and I do. Right?

But now I'm like, “What would” – you know, it's like WWDD. “What would Dave do?” You know [laughs]? Would Dave just sit here and comment about CPE and CPI? No, he would not be that he would dig and dig and dig and tell you everything that's wrong with it, and then he would dig and dig and dig and tell you what was the real thing. I think he's raised our bar, man. You know? He's raised our bar. What can I say? I'm inspired.

Corey McLaughlin:    All right [laughs]. I don't know what to say either. You know?

Dan Ferris:                 No. That's right. So I don't know. That's just where I am. Because I do think – whatever these numbers are, whether it's 4% or 2% or 2.8 – whatever it is, it does at least track what I believe is the real trend, which is persistently higher inflation than we had previously. I mean, at least there's that.

Corey McLaughlin:    Yeah. And I do think that idea you just brought up about creating your own inflation index is not a bad one at all. Like, when you've got your own – I mean, let's face it. Most people, they have maybe a concept of their expenses but they definitely don't – most people don't track them religiously by percentage increase either. Which is probably worth doing, you know, every once in a while at the very least. You know? Once a year would be great. Right? Or, you know, a couple times a year would be better.

Dan Ferris:                 I remember once Lori and I bought a house from a couple of schoolteachers. Really gorgeous house. They were in way over their heads and they had to get the hell out of it. And he presented me with this whole folder full of all their tracked utilities. So it was like showing me charts of the utilities trend. I was like, “Wow. You’re the schoolteacher and I'm the newsletter writer in finance and I don't do this. I should do this.” And that's what you're talking about.

Corey McLaughlin:    Yeah. Totally. You know? That's how you get started. Right? You have your expenses and you have your income and, you know, my thought has always been make sure your income is higher than your expenses and invest the rest as smartly as you can. So yeah. If you can, you know, track your expenses and keep track of inflation at the same time, it's probably a pretty good deal. So yeah.

Anyway. That's just a – I think a good thing for anybody to do. No matter how much you're making or how little you're making or think you're making or how large your expenses are. You know, because we all know plenty of people that have plenty of, you know, quote-unquote “money” who are burning through it more than they can afford to and may not even know it. And you have other people that are not and, you know, closet millionaires and whatnot. Which I prefer to talk to look into what those people are doing. And I'm fascinated by those kinds of people that are just –

Dan Ferris:                 Right, the so –

Corey McLaughlin:    Yeah, walking around with a wads of cash. You know? Proverbial wads of cash walking around with that don't look like it at all. So yeah. So anyway. It's a good idea. I think I might do that, like, this weekend. Just check up on that.

Dan Ferris:                 Yeah. I bring my tax data together – I’ll bring my tax data together at the end of June for the first half of the year. So maybe I'll get inspired to track it a little better. But yeah. So tracking expenditures is important. And what we're saying here – what I'm saying here in talking about these indexes – is I want to know what the real increase is in expenditures on essential items. Like, this idea of core, there's something very troubling to me about that. Because core excludes food and energy.

Now, if there are two expenses that are core to your existence – and I realize core is just a technical term so that you know that they're excluding food and energy. But at the very least it's a poorly chosen. Because if there are two things that are core to your existence, it's, you know, the food that sustains you and the energy necessary to bring it to you and the energy you expend to live and be sheltered and transport yourself to get your food. Right?

And to do the things you need to do to earn money to get it. So that idea too. All of the stuff I think you're witnessing in real-time – Dan is just getting fed up. I'm just getting fed up with the rather corrupt nature of the data. And I have to admit. You know, speaking of being inspired by Dave, doing my own investigations into the climate scam have also inspired this.

Because once you start looking at the real data, you realize that the collection methods are absolute garbage to a surprising degree and that the interpretations that have been popularized are just plain false. And you realize that organizations like NOAA – National Oceanic Atmospheric Administration and NASA – specifically NASA GIS, the satellite – you realize there’s real corruption there in the way they publish and manipulate and actually outright fabricate a lot of the data.

For example. There are these weather stations, temperature stations outside the United States. Many of them are interoperable or no longer existent. You know? They will have paved over the parking lot or whatever. And they're still collecting – “collecting,” in quotes, data from them. They're just fabricating it. So once you learn about something like that, you go, “Oh, geez. You know, that’s problematic. This isn't science. It's Bologna.” And so, I feel the same way about all these economic data. Now, what to do about it, that's tough. They used to have – have you ever heard of the BPP, the Billion Prices Project at MIT?

Corey McLaughlin:    No.

Dan Ferris:                 It was an attempt to create a real –

Corey McLaughlin:    Oh, yes. I'm sorry. Yes. Yeah.

Dan Ferris:                 Yeah. Yeah. You probably forgot about it because they stopped it. They discontinued it. I think – I want to say they discontinued in 2015 but I don’t remember. But it's been discontinued for years now. I’m like, “Why? Was it too accurate? Did the government call up and say, “Hey, you're making us look bad”? You know? I think it was probably just too hard. I mean, they were gathering so much price data and, you know, they're not the government so they don't have endless money to spend.

Although they are MIT. They're pretty rich. Maybe they have a pretty rich endowment but, you know, maybe they don't want to spend it on that. But at any rate they discontinued it. But we need something like that. We need something better that's not the official word of, in this case, the Bureau of Economic Analysis for the PC data.

Corey McLaughlin:    Yeah there's something else out there – also the – what’s the money I’m thinking of? Shadow stats?

Dan Ferris:                 Shadow stats. Yeah.

Corey McLaughlin:    Which a lot of people like to quote too. Which, you know, hits me as a little bit more legitimate than the government numbers. You know, data based on – at least based on how the data used to be calculated in the – since or before 1980. So if people are interested in that they could check that out. Shadowstats.com.

Dan Ferris:                 Yeah. I mean, I am not endorsing Shadowstats because I've heard various things from various people about it. But certainly that is the spirit.

Corey McLaughlin:    Yeah, that's the spirit of it.

Dan Ferris:                 That we're talking about. All right. Well, you know, I hope, dear listener, that indulging us as we kind of make these revelations in real-time with the show [laughs] is worth your while. And at the very least we're kind of committing to figuring out inflation a lot better, I think. And that should work out well for you. So who knows? Who knows what we’ll come up with in the future? We'll have to find something but the key to this, Corey, is you and I are going to have to find somebody who's already really done this. Maybe it's the Shadow stats guy. What's his name? Anderson? Is that him? Maybe it's him –

Corey McLaughlin:    John Williams. Yeah.

Dan Ferris:                 Oh, John Williams. Sorry. Williams. So maybe with him but maybe it's somebody else. We'll keep looking. We'll find that guy. We'll find that guy or gal.

Corey McLaughlin:    Yeah. That would save us a lot of work too.

Dan Ferris:                 It would. It would. That's what the show really needs to be about. We need to find the people who – somebody’s already done it. We know they have and we’re going to find them.

Corey McLaughlin:    Or they can find us. E-mail us.

Dan Ferris:                 That's our pledge. Yes. Yes.

Corey McLaughlin:    [email protected].

Dan Ferris:                 Yes. You’re our listener. You know, tell us. Tell them. Tell them to contact us. You contact us, tell us who they are. We’ll find them. Good. I think we made real progress here today. I think [laughs] we're on to something.

Corey McLaughlin:    All right.

Dan Ferris:                 All right. So, you know, that's another look at the world and another episode of the Stansberry Investor Hour. I hope you enjoyed it as much as we really, truly did. We do provide a transcript for every episode. Just go to www.investorhour.com, click on the episode you want, scroll all the way down, click on the word transcript and enjoy. If you liked this episode and know anybody else who might like it, tell them to check it out on their podcast app or at investorhour.com please.

And also, do me a favor. Subscribe to the show on iTunes, Google Play or whatever you listen to podcasts. And while are you there, help us grow with a rate and review. follow us on Facebook and Instagram. Our Handle is @Investorhour. On Twitter our Handle is @investor_hour. have a guest you want us to interview? Drop us a note at [email protected]. Or call our listener feedback line. 800-381-2357. Tell us what’s on your mind and hear your voice on the show. For my co-host, Corey McLaughlin, till next week. I'm Dan Ferris. Thanks for listening.

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