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Language: en
America is in a precarious position. We
show no signs of being willing to cut
spending. So without massive growth, we
will go bankrupt. But where is that
growth going to come from? We're
supposed to be the ultimate dealmaker on
the global stage. We're supposedly the
ones holding all of the leverage. Donald
Trump claimed he knew the art of the
deal better than anyone. But what's the
reality behind America's negotiating
power? Are we making progress or have we
lost our edge? Today, Kevin Olirri, one
of the most candid and incisive economic
and entrepreneurial minds around, joins
me to give a rare inside look at what's
really happening. If you want to ensure
your economic future, you are not going
to want to miss Kevin's take on China,
taxes, and the future of the economy.
This is an episode you simply can't
afford to miss. Without further ado, I
bring you Kevin Olirri.
America
prides itself on having the most
leverage internationally on trade. Trump
was supposed to use that strength to
help America win. From your vantage
point though, are we winning or are we
now falling short?
>> Well, it depends which index you want to
use to determine success. If you look at
the stock market market cap uh
valuation, the market is is happy with
uh the outcome of the tariff wars so
far. inflation hasn't uh come back yet,
although many many pundits believe that
you just have to wait a couple more
quarters. Um it probably as a result of
the uncertainty has stalled the Fed for
any rate cuts, which is frustrating
Trump. You hear that every day. I I
think Pal is wise to wait and see what
happens as this comes through the
system. But I I want to make a point
about um the actual tariffs themselves
and how you should look at it as an
investor. um whether you're just putting
aside a retirement fund or you're
actually doing direct investing or
you're a sovereign wealth fund, it's all
the same. Think about it this way. Let's
take um the negotiations going on with
uh England which is not in the EU, the
EU itself, Japan, Thailand, Indonesia,
Canada, Mexico, etc., etc. Most of these
countries have a VAT tax, a value added
tax, which is a tax that is a
consumption tax at the consumer level.
So to keep it really simple, let's say
an American company ships a product up
to Canada in into the province of
Quebec, like a stick of butter. and
whoever buys it in the in the province
of Quebec pays a 13% VAT tax, value
added tax, and that goes to the Canadian
government or the Quebec government.
It's a split. They kind of split it
almost half half. Well, Trump looks at
that and says, "Well, wait a second.
Isn't that a tariff on an American
product?" Mhm.
>> And so all he's doing and and then he
comes back and says to the Canadians,
"Okay, I'm proposing a 35% tariff on you
uh on everything you ship into the
United States." And they say, "Well,
wait a second. That's a little heavy.
We've already have agreement with you."
But basically what Trump is doing, and I
think people should think this one
through, there's no way on earth
Congress is ever going to do an American
consumption tax. It's just not in their
DNA. There's no American VAT tax.
However, what Trump has done is exactly
that and he's called it something else.
So, if the Canadian deal, let's just
take the Canadian deal cuz it's easier
to talk about, which is being negotiated
as we speak today as we speak. If they
end up with a reciprocal tariff of 10%,
let's say, which has already been
established for the oil coming out of
Alberta, Canada, the cheapest source of
energy to Cushing.
It it's it's already been negotiated.
And so it's a 10 10%
tariff on that oil and that energy and
that that gas. What if that's for all of
Canada? So basically, you've got a VAT
tax up in Canada, let's call the blended
rate 10 or 12%. And you end up with a a
tariff, a blended tariff on all goods
and services leaving Canada and the
United States to 10 to 12%. Well, there
you have it. Trump put his VAT tax in
place. Everything's equal. Even Steven,
so to speak. I think that's where we're
going. Now, is that
>> is it just a negotiating tactic though?
Because Trump will have us believe that
we've been getting battered, abused,
taken advantage of by the global
community and it's got to stop or
America is something bad is going to
happen. Is that actually true or is he
causing mass chaos?
>> Trump is I mean I always say this about
Trump. I you know I've known this guy
for 17 years. Um, we actually met when
he started the celebrity, you know,
apprentice show. It was the same year
that that I did Shark Tank for for Mark
Bernett. So, we both know Mark Bernett.
We both sold forwards to the car
companies, the ads in New York. And I
think he has a remarkable presence and
is an extraordinary salesperson. I mean,
I've just seen him in action. But he is
bombastic. He says outrageous stuff. And
what I've learned to do just to be
pragmatic because I have to live under
his policy and and invest under his
policy is to filter out the noise um
from the signal. I think the signal in
the case we're talking about is
reciprocal value added taxes. He calls
his a tariff. The Europeans and the
Canadians call theirs VAT. Who cares
what it's called? It's a tax. And so can
the economies live with reciprocal 10%?
Yeah. What Trump is unhappy about that
he'll never be able to fix. You take a
country like Vietnam, they don't have
enough people to ever have trade balance
with the United States. They simply
can't buy enough stuff to offset
how much stuff we buy from them because
many companies including mine have moved
out of China to Vietnam or Cambodia or
India. So these countries have massive
trade deficits the United States cuz we
manufacture stuff there. Now, can Trump
get all that stuff repatriated? Not
during his mandate. You can't do that in
34 months. I You can't move all the
factories back to us. But the policy
itself will slowly self-correct. I don't
think we need to make plush toys in
America. We don't there's no value added
in making a Barbie doll in the United
States. That job is not a high value
job. I think it makes sense to make
chips here, you know, semiconductor
chips. That makes sense to me. High
value ad, that makes sense to me. So
Trump is trying to balance all that. But
you got to you can't listen to all the
noise. I mean, he he he's a walking
press conference. Like he just says
whatever he wants to say when he says
it. I'm so used to it now. It doesn't
phase me whatsoever. I just focus on the
signal.
>> But is it moving us forward in
international negotiations? I we'll talk
very specifically about China in a
minute, but right now I just like if you
were going to rate his negotiating
skills, is he actually moving us
forward? Because now that the the whole
idea of 90 deals, 90 days, um it's just
sort of dragging on. We're not seeing
like enough wins that really make a
press conference worthy. Like is is
anything actually happening?
>> Yeah. Yeah. I mean, we're never going to
get 90 deals in 90 days. It's never
going to happen. I mean it takes it used
to take two years to get a deal done
with one country. He's just accelerating
it very very quickly and he's getting
sort of letters of intent. What the
market really wants to hear is they
don't care about the the granularity of
the deal itself. They just want to know
what the tariff itself is going to be.
So if you're an investor in in a country
jurisdiction like uh um Switzerland for
me or Canada for me and there's other
places I invest. I just simply like to
know what's the deal. Is it going to be
10 12 15 14 13? what the what is the
actual reciprocal tariff going to be so
I can adjust my capex accordingly and
the rest of it I don't care about I
don't you know I don't care about the
you know the the detail I need to know
what the reciprocal tax is and in the
case of of Canada uh because it's the
the largest trading partner of 28 states
they're going to have to resolve that
one pretty soon because both countries
need each other on that and the
Canadians are going to have to give up
their um uh the their their supply
chain,
you know, um tariffs like on butter and
eggs and milk and in against Vermont,
they have 200% tariff. That's just not
sustainable.
>> You seem pretty um sanguin about the
sort of what many people will point to
as the chaos of Trump, but there are
things that ring your danger bell. Um,
so from a an outcome perspective, what
would make you worried that yo, this is
putting us in a bad place? Uh, either
specifically from an American standpoint
or just from a global investor
standpoint and what would put us in a
good place?
>> Yeah, I mean the the red bells would be
ringing and I would be very concerned
about unsustainable tariffs for a long
period of time like 35%. That wouldn't
work. that would that would never work
with anybody and it it would cause major
chaos in financial markets. Um I think
Trump knows that. Um I don't I don't get
caught up in politics per se or you know
show for politicians even Trump. I show
for policy. So I wait until I see the
actual policy. And lately because um I'm
involved in in certain sectors like um
stable coins or data center development,
I have to get my hands dirty in
Washington and I go there to meet with
senators and governors and
representatives in the administration to
understand where they're taking their
policy. And so because I have to know
what that is or I can't be successful as
an investor. My point is I don't have
Trump derangement syndrome. I don't
care. I only care about policy. And so
if I believe that Trump was going to do
35% tariffs on major economies that I'm
an investor in, that would be a big
problem. And you would see the markets
correct pretty quickly around that. But
the market doesn't believe that anymore.
You've had this volatility in Trump's
now it's 35%, now it's 10, whatever it
is. The only thing that matters is what
is the endgame? What does it end up at?
And if you told me it's 10% reciprocal
worldwide, yeah, I think the market's
betting on that right now. And I think
uh we're going to get there. And and
then at the end of the day, all this
stuff was just a bunch of noise and
volatility based on, you know, nashing
of teeth. And look, there's a lot of
people that don't like this guy. I mean,
they just don't. And they're never going
to get over it. They can't believe he's
president. I say deal with it. He's
president for the rest of this term. Get
over it. Now, if you want to do
business, focus on that and just focus
on policy.
>> All right. So, China, I think, is the
game. I've heard you say similar things.
Uh, I'm routinely trying to refocus my
audience on listen, China matters a lot.
Everything else, for the most part, is a
distraction. Do you think that we can
apply enough pressure to China that
they're going to be forced to come to
the table? Because obviously, Xi would
have us believe, nah, whatever. I don't
care. I've minimized my exposure to the
US more than you guys think. Um, I can
outweight you. You guys are going to
come on our terms.
>> No, he can't do that. It's not going to
happen. And, uh, we need to work a deal
out with China. Um, you're right though.
Everything else is a distraction
compared to China because the these
these two economies are going to an are
entering an economic war against each
other. Hopefully, it's not a a military
war ever, but an economic war and an AI
war because the country with the best AI
is going to win all the wars in the
future. You you got some essence of that
in the Iran situation where very few
American boots on the ground there. Um
the entire operation was done using
technology uh some of it very advanced
and robotics uh and everything else and
very very precise missiles led by GPS
technology that also uses predictive AI
and so all of this stuff that that's the
first time we've seen a 48 hour war that
way. China was watching, the Russians
were watching, everybody was watching.
And it gives you an idea that this race
um of technology
and and AI and the economy are all kind
of fit together. So, here's here's the
here's the way to view the Chinese
situation from 30,000 ft.
In my view, this is my personal opinion,
and I've been dealing there for over 22
years now. ever remember they came into
the WTO in um back in 2000 and uh there
was a lot of assumptions about
compliance back then. That was during
the Clinton period. They never complied.
Um they cheated. They stole IP. They
built many of their sectors around
American stolen IP, German stolen IP.
And nobody um made them pay any
consequences for that. They just kept
saying, "Well, they'll as they get
bigger and they'll understand the value
of democracy, this will be better for
us." That never happened. Um, they
basically stole it all and then became
very proficient at advancing it. So,
they're they're particularly their tech,
their automotive and um, you know, all
kinds of different sectors are built off
someone else's tech. Now, you can find
the DNA of any of this stuff just by
reverse engineering anything they build
over there. So, it's we don't have to
argue fact. I believe it's a fact. It's
what matters is what happens now. Are we
going to continue to let them steal
American IP or are we going to somehow
hold them accountable? And I think we're
in it for for for for decades now,
various administrations,
nobody has taken them to task on this
issue until now. And so you've got a
whole bunch of issues wrapped up in this
narrative going on the next few weeks,
including the September 19th decision on
Tik Tok, which is blatant spywear in the
US. There's no question about that. And
the law has been already passed. It's
either going to go dark or somebody's
going to buy it and rewrite it under
American laws. So, who knows how that's
going to shake out and we haven't
decided or or know what she wants to do.
Only he and Trump can decide. But I I'd
argue that by the time this narrative is
over with China, they will comply
because if they lost access to the
largest consumer market on Earth through
massive tariffs,
there'd be a lot of unemployed Chinese
rioting in the streets. And if you're
the supreme leader, you cannot afford
that. You can't afford that. And so she
is not an idiot. He knows that. He
doesn't want to back down. Neither does
Trump. They're going to have to find
that accommodation. But it's not just
about tariffs. It's about IP, access to
their courts to resolve trade disputes,
access to their financial markets. They
get access to the New York Stock
Exchange. And the NYC's rules are not
even abided by. They
>> Have you heard Trump making noises about
that, or is he just focused on the trade
aspect?
>> No. No. Trump has already talked about
this. It started in Geneva three months
ago, whenever that was. But
every everybody knows that within the
administrative narrative with China
right now at the at the level of
discussion, they're trying to resolve
these issues. Each of these is a
separate issue. Tik Tok's a separate
issue. Chip sales from uh Nvidia,
separate issue. Um, you know, all of
these things are separate multi-billion
dollar issues that are unique to the
China negotiation. We're not they're not
having that narrative up in Canada or in
Mexico or in the EU that they're they're
having that narrative with China because
if China wants to play with the big boys
and have equal access to the American
market, they have to play by the rules
now. the legal systems, the IP laws,
access to financial markets under the
rules and regulations of the SEC.
All of these are sub issues, but the old
way of doing it is over. I mean, if if
if China wants to keep stealing IP,
it'll end badly for them because the US
is still the largest consumer market.
That's the stick. That's the hammer.
Trump has that leverage now. He may not
have it forever. Congress understands
that. Um,
and and we obviously I would like to do
business in China. I that's a huge
consumer market. There's many products
and services I want to sell there, but I
don't want to get screwed doing it.
>> And so, you know, that the the I got to
be honest with you that what's happened
over the last 20 years, no one ever
looked at the granularity of this and I
see it through a lot of the small
startups I fund. Let's say you come up,
let me give you an example. Let me give
you a very simple example that I think
your viewers would appreciate. Let's say
I come up with a innovation and I patent
it called drain wig. It's a real
product. It's so simple. You put it down
your drain in your own home or in a
motel or commercial, you know, resort or
whatever and it collects all the hair
and it does it in a unique way that
actually works. Many designs have been
tried to do this. They failed. Drain Wig
figured it out and they patented it and
they sold it for $29.95
and it it really worked. And so
commercial institutions said, "Wow, I
can cut my plumbing costs by 60%." By
just stopping,
>> right? Huge.
The minute it got to 5 million in sales,
40 knockoffs. 40 knockoffs. 40 knockoffs
on the market at $8.99.
>> Wow.
>> They they didn't have to pay back the
R&D the company had spent or all the the
money they, you know, spent creating the
product in the past and creating
distribution. It already had been done
by them and then they got knocked off.
Company went out of business or changed
hands as a result. That happens millions
of times. Nobody made You didn't hear
that tree fall in the forest. It was a
tiny little company of five million.
Could have been a hundred million dollar
plumbing supply company one day, but
that didn't happen because it got
knocked off by China. That's what I
testified about in Washington. I gave
them examples of that that they'd never
heard of. They did their diligence and
they realized that's how we're getting
screwed. One innovation at a time.
screwed over and over again with not
because nobody brought them to task.
Well, I think there's a new sheriff in
town. Maybe you like him, maybe you
don't, but basically Congress has had
enough and they're pissed.
>> We'll get back to the show in just a
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Do you think um that we're going to see
two egos that have no they have no
incentive to back down? Trump can be
very pragmatic at times, but uh he's
very bombastic in a way that I think Xi
responds allergically to. I think Xi has
proven with the zero COVID policy that
he'll go hard in the paint and is
perfectly willing to see his people
suffer to get what he thinks is the
right outcome. Um, does this get
disastrous before we find resolution?
>> I think, um, it's a good debate for you
and I to have because I think this will
be the toughest negotiation. I think
you're right about that. Um, I don't
think she wants, you know, when you're
the supreme leader for life, you can't
make many mistakes because you got to
keep everybody happy. You're only the
supreme leader while the people that
support your supremacy back you up. if
they see weakness and you've seen this
happen in China before, you're gone
pretty fast. And so he's got a pretty
big pressure cooker there, a real
balance. He cannot have mass
unemployment. That would be mass
inflation because he would have to print
money, people to buy bread, and the
price of that bread would go through the
roof. And so it's and he knows that he's
not stupid. This is a smart leader. And
I think that's the pressure cooker. So
my guess is there's going to be a deal
and it doesn't cost a lot for Chi at
this point to give up on IP theft. He's
already stolen all he needs and you know
it's sort of at this point he can
compete and and I think he is I think
he's competing in aeronautics. He's
competing in biotechnology. He's
competing in AI and he did it all on the
backs of other people. He stole it all.
And so now you can't take back what he's
stolen. But he is advancing his own
versions of all these things. And I
think it's easy. It's an easy gift for
him to actually comply with the World
Trade Organization to have to have
disputes. He's got a he's got I don't
know how many thousand disputes are
unresolved at WTO. So maybe he should
get kicked out of that or at least, you
know, fix that, which I think the WTO
could pressure him and might do so. But
they're going to need the lead of the US
to start that. And I think China wants
to be playing with the big boys, the G8,
so to speak. I think they want to get
there and I think they're going to be
vicious competitors, but I think it's
good and healthy to have a competitor
like China. And I'd like just for them
to play by the rules. And I think that
messaging is the one that the market is
anticipating.
you if if we really thought it was going
to be disastrous outcome, if you and I
believe that and the majority of
investors believe that this market would
correct 40% right now and I don't I
don't see that happening.
>> Man, fingers crossed. I certainly hope
you're right. Uh the image that plays in
my mind that I'm always looking for
somebody to talk me off the ledge is
that we have the perfect setup for
Thusidity's trap. China has a long
history of being the big dog in the
world. They have the identity of we are
the biggest and the best. That we're
this temporarily embarrassed nation. We
are finally clawing our way back to the
top. Every time you have a rising
superpower and a declining superpower,
they end up colliding and they find
themselves inextricably typically pulled
towards a kinetic war. I think we're
already in the middle of a cold war with
China. Uh, and so I look at if I'm in
Xi's mind and I don't think like an
American inside of a Chinese body.
Instead, I think of the the way that a
collectivist um person would think that
has uh, you know, come up through all of
the horrors of Mao that personally
affected his life. He sees what I call
red light, green light capitalism of
hey, we understand capitalism is how you
move forward. But we also know that if
you kidnap enough of the uh top people
and re-educate them that you can keep a
level of control on this thing. So to
me, this is all going to boil down to
because I think he is going to flex as
hard as he believes he can possibly do
before there's a coup that he can't
squash with violence if I'm really
honest. And it all comes down to how
real is the housing crisis? If the uh
real estate crisis over there is real
and they're like in 2008 levels of
fragility, then I think he's going to
realize, okay, I'm not going to be able
to push this as far as I want, he'll go,
you know, he'll push, but like
ultimately Trump and he are going to
come to the table and both realize, all
right, we're not on strong enough
footing, so we're going to have to come
to an agreement. But if the housing
crisis isn't real enough, I think Xi
will be able to out he'll be able to get
Trump past the midterm elections and
then it's over.
[Music]
So, let's just break down what you just
said there because I I think you're on
to a very good point here and I think we
should look at it.
you just described a scenario um where
if I were a a young bright individual in
any country anywhere and I had the
opportunity uh cuz I was an entrepreneur
and I wanted to exploit my ideas and I
wanted to build a business and I wanted
to be an innovator. um would I want to
go to a geography that you just
described or or or would I like to
immigrate to America where for over 250
years it's proven that if if I'm good
enough and I'm and my ideas are are
validated and they do solve a problem I
can build a business and create freedom
for my family. So I started that basis
as being what makes any country
competitive. Can you create an
environment even with all the faults
that anyone has? Like
there is not a chance in hell I would
want to go live my life in China. Not
when I could starve or supreme leader
could re-educate me. I love that word
you brought up. I don't want any of
that. Why would I want that? And so in
the in the pursuit of intellectual
capital that creates all the innovation
globally, who's going to win on this
one? And I think the constant signal
between these two economies is just that
the human being who wants to live in
freedom, who would rather go to a place
with all of its faults. I mean, there's
a reason people risk their lives to
cross rivers under barb wire to get into
America. You don't see that happening in
China. I don't see anybody trying to get
into China. And that's why. And so, I'm
going to bet my capital on that. And I
think the rest of the world is betting
their capital on that. And it's sort of
then you can get into the mishmash of
you know who's the president and all the
rest of that stuff. But I'm confident
that my assumption is correct about the
pursuit of freedom being the reason that
economies are successful.
And
I think you can you can steal all the
stuff you want, but if if people don't
want to move there, you have to rely on
your own internal policy, which can be
brutal.
And ultimately, you'll never be the
winner. You'll always be number two. And
maybe that's okay for Chi. Maybe he can
live as number two in perpetuity cuz I'm
pretty sure he'll die one day. I mean, I
don't think he's a vampire. And so, if
they really want to compete and they
want to win long term, the only
successful philosophy, period, is
democracy. Period. Period. That's it. or
a form of democracy that is so trusted
such as BVIN, you know, or or trusted
leadership like the UAE, which is not a
democracy, but has proven for at least
this last 50 years that they understand
what democracy is and they rule that
way.
>> That's the only way it's going to work.
You don't you see a lot of people trying
to get into the UAE and getting a
passport there. They want that. they
they they like the the system the policy
there but
that's a very democratic in a form
country. So and and I'd argue that they
are the petri dish. They could have that
country is only 52 53 years old. They
could have chosen the Chinese way. They
could have chosen the Russian way. They
could have chosen Venezuela or Cuba or
North Korean way. They didn't. They took
the best of culture around the world,
the best of policy, and they created a
behemoth economy that's competing now.
And the metric I use is China's number
two and AI spending, the US is number
one. Who's number three? UAE, how they
do that. And so it's sort of
that, you know, I teach this stuff. I'm
an executive fellow at Harvard. So I
have classes with people
ex explaining to them what I believe
works, trying to convince them to think
that through and trying to convince at
least a third of the class not to become
consultants cuz that's what they they
just make consultants at these business
schools. Then those people live a life
of mediocrity. It's a shame to see it
happen. But that's a long answer. So,
I'm not as worried as you are because I
think long term you can't beat what
America has proven works. I I agree with
you on that. Uh, however, where is your
confidence level that America the the
voting public is going to maintain their
belief in that freedom. When I look at a
mom donnie or I look at just the look at
Minnesota and and the types of
candidates that are running for uh
governor, running for mayors of local
cities, you're there there is a real
populist push to the left for policies
whether you call them blatantly
socialist policies or you call them
social democracy for reasons that I can
outline in detail. I believe that uh
American youth is losing their
enthusiasm for capitalism. Full stop.
>> Yes, I've heard that. Um and I think
it's it's a valid concern and it's a
it's a fair point to bring up and you
definitely have evidence in New York
City and and other states as you've
detailed 100%.
But I've also heard that same claim
back in the 50s. I'm I'm a you know I
I'm I go back and I look at history.
There was a time when communism was
rising up and it was occurring in places
like New York City. There was a very
bohemian vibe to it and people claimed
that it was a better way of life and
young people swarmed to uh they were
some of them were called beatnicks that
far back. It we have this move I've seen
this movie before and so
>> what knocks it back though.
>> Well, I'll tell you what happens.
Reality strikes. It's sort of like um
what you what you hear happening right
now in New York because that's a good
case study. This mandavi mumavi thing
that's going on if you listen to his
rhetoric it's basically money for
nothing and chicks for free. I mean and
I totally get it. I totally get it and
it's it's very it's it's a great message
if you want to be elected as mayor. His
problem is going to be delivering on
that. New York is already the highest
tax jurisdiction in America. Um, and
it's it's obviously not that wellrun
already. And so it it's what happens for
these kinds of cycles. And my argument
to you is going to be very simple. The
American uh democracy, the the way it
was built, it has the ability to
self-correct and does. It self-corrects
in 4 to 8ear cycles. and it has since it
was formed and you just saw it happen in
the general election. The country was
moving too far to policies that didn't
make sense to the kitchen table in
Champagne or Val Orbana, Illinois. And
so boom, it selforrected and and it
selforrects at the municipal level, at
the mer level, at the state level, and
it'll do it again because when you offer
money for nothing and chicks for free,
you can't deliver. The system doesn't
provide for that. And so it's a classic
case of you won't get fooled again
because these young people that are
voting for him are going to want the
free food, the free, you know, grocery
stores, the free subways, the free and
there's not a chance in hell he can
deliver that. And so they will be pretty
unhappy with him in the next cycle. Now
I'm not sure he's going to win. um
there's a fair amount of people what
willing to to start to examine his
policies but my whole point and I don't
want to get too far is that yes people
have gone into this young people today
want communism young people today want
socialism not actually the majority of
them want a job they want to raise a
family they want to be able to support
it and about a third of them have that
burning desire of the American
entrepreneur that wants to create
something magical for themselves not the
greed of money, the pursuit of freedom
which has driven this economy and I live
that every day and I can guarantee you
every year and I'm I'm the investor in
them. I see a new crop of them.
We're very healthy there. We're we're in
great shape. So within my own family, we
have these debates. I've got young kids,
too. And uh believe me, you know,
Thanksgiving dinner is full of this
rhetoric. But I look every year at how
they too have advanced the minute they
got a paycheck and saw tax. They went
from being screaming liberals to raging
conservatives. And that's kind of what
happens. I watched it happen in my own
family. It just happens. People want to
know where where did half my paycheck
go? Who did I just give that to? As soon
as you get a job, you move from being
that socialist to that conservative.
That's how America works.
>> All right, guys. We'll be back to the
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And now, let's get back to the show. All
right, I'm going to give you my best
black pill pitch and uh then I hope that
you can dismantle this argument. So, I'm
a big Ray Delio person. I believe that
Rey has gotten to the physics of how
money works effectively by looking at
debt. And we're we're nested inside of a
big debt cycle. And the problem is in
the 50s, we had not reached phase five
and a half, which is effectively where
we are now. Phase six being total
collapse. Just the debt becomes such a
burden that you there's nothing to do.
who have to default. It seems to me that
we're on that path, especially given the
big beautiful bill. But I don't want to
get distracted by the wise right now.
Just the structure of the debt goes like
this. Um, in a fiat money system where
the only way out of the kind of interest
payments that we have to make now to
keep giving everybody the money for
nothing and chicks for free is that you
print money. Printing money makes assets
go up. Houses are the only asset that
people understand intuitively. So
suddenly that housing becomes
unavailable to the whatever 40-ish% of
people that otherwise just aren't going
to own assets because they don't
understand financial markets. And so now
you get this hollowing out of the middle
class by pushing the people that
otherwise would have been in the middle
class up to the upper class because they
do understand assets. And then you push
the 40ish% of people in the middle class
and low class down even farther because
they don't understand assets. And that
hollowing out creates this massive
inequality which triggers something that
is so embedded in our DNA which if
you've ever seen a monkey do a task next
to another monkey doing the same task.
You pay them both cucumbers, everybody's
fine. You pay one monkey a cucumber and
the other one a grape and the one
getting the cucumber freaks out. And
that's what we have now. And so it the
jinny coefficient which is the basically
it doesn't matter if everybody's poor,
everybody's rich. What matters is are
there poor people who can look to their
neighbor and see them being rich? That's
when people go ballistic. That's the
setup that we have. The middle class
essentially doesn't exist anymore.
Housing is completely out of reach.
Somewhat uh somewhat of an illusion
because it's really just money printing.
But anyway, you create that setup. So
now even these kids that would they want
to be raging conservatives, they still
don't see how they're ever going to get
on the property ladder. And so that
resentment just builds and builds and
builds.
>> Well, that's a very eloquent job you
just did there of of I read Ry as well.
I'm an advocate of uh understanding his
point of view and it's an important one
for me. I'm basically a debt guy and
always have been. Um, and and I I came
up in in the fixed income market. And
so, um, 100% he he he's he's a very
valid thinker in strategizing that
scenario. And and the question is why
wouldn't that happen? So let's examine
because you know one of the things you
have to risk when you're an investor
like me is if if I really believed that
um we that scenario is going to roll out
my portfolio mix would be completely
different than it is right now. Uh but
I'm basically um believing that the debt
markets which you know they call them
the bond vigilantes um are asleep right
now. The smartest investors are not the
equity guys. The smartest investors are
the debt guys array and the reason is
they take duration risk. So they have to
be historians in the sense they look
back to try and forecast the future. Now
here are some things you got to think
about. The big beautiful bill which
caused chaos in the relationship with
Elon Musk and Trump that's still playing
out
was Elon had the understanding in his
mandate his 120day mandate that he would
try and create a balanced budget.
Instead we we took on another 3 trillion
of debt if we just score this budget the
way it is. What Elon didn't understand
and I think he understands now is
to get stuff done in Washington and the
primary mandate of getting that bill
through was to anchor the tax rate
because the reason the American economy
is and we just got new consumer numbers
today economy is on fire. It's doing so
well right now. And that's because this
tax rate is competitive against the G20.
We don't want to change that. We can't
have our tax rates go up into the top
quartile of tax, the G20, because it'll
slow down GDP growth. That was Trump's
goal. He achieved it with a big
beautiful bill. Now, how do you deal
with balancing the budget? You got to
find a way to save $3 trillion.
Well, that's where his new task is. And
he can't do reconciliation
except every 12 months. But you may not
or you may know this, the government
timetable starts in September in the new
year. So, as soon as you get past
September, and this is what I don't
think Rey is giving much consideration
to, if the economy continues to grow,
the amount of tax income that comes in
just on a normal day basis goes up. In
addition, if the tariffs are successful
at a 10 to 12% rate, that in itself has
not been scored yet. That brings in
trillions of dollars against this
deficit. The third aspect and I give you
on this one is does Washington have the
stomach to actually take these new
revenue streams and deploy them into
debt reduction as opposed to pissing
them away with stupid programs. And that
is the challenge that I think is next
because it it wasn't long ago that we
had a balanced budget in America. It
doesn't have to be this way. There may
be, for example, just doing a means test
on social security.
Maybe not everybody should get that
check. Maybe it's a different form of
tax. Maybe if you're making over a
million dollars a year, you don't need a
$4,000 a month check. And so that's one
aspect. Health care could be better.
That's another aspect. I'm I'm an
optimist
in the sense that Ray hasn't given any
credit to these other sources of income.
He has taken the baseline, assumed it
doesn't change. I'm not there yet. And
apparently the market isn't there yet
either on either bond vigil vigilantes
or on the equity side where we continue
to see new highs. I'm more in the
bullish on America camp. And Rey, as you
know, spends a lot of time or I do in
Abu Dhabi. He's a global thinker and I
like that.
But even he knows where half of his
dollars go. More than half as the rest
of the world's sovereign wealth goes.
Where do you find it? Here in America,
because there's no other market like
that. And if the rest of the world
believed that collapse was eminent,
they'd be sitting with all that cash
under the streets of Zurich. So I don't,
you know, I'm not I'm not agreeing is
what I'm saying. I'm I'm the other side
of that argument and I'm going to stay
with it and I'm going to watch it and
I'm going to be part of it. You know, I
I work very hard in Washington on behalf
of and my last point on the Ray thing is
70% of jobs in America, 70%
are created by companies between 5 and
500 employees. Those are my people.
Those are the companies I invest in. I
am their advocate in Washington. I
actually read the Tax Act. You didn't
read it. I read it. It's just you, I
think, at this point, which thank God
you did, by the way. So, the more info
you can give people to look out for, the
better.
>> And I saw stuff in there I didn't like.
And I worked with Senators Hagerty, Rick
Scott in Florida, and Ron Johnson with
their staffers, and I said, "Guys, this
is bad for small business in America.
This line, this line, this line, this
line, this paragraph. help me ward off
this catastrophe cuz I can't do it. I
can only be the advocate for these
businesses. And if you don't believe me,
why don't we talk to some of these
businesses? And thank goodness these
great senators had the guts to get in
there and fight for these changes. And
I'm extremely proud to have been
involved in that that took out some
extremely bad policy. But that's the way
America works. If you really believe
that it's going to hurt 70% of job
creation, you have to stand up and go to
Washington and sit down and meet these
people. They're not stupid. They're
pretty smart. And if if they can if they
if they're influential enough and those
three senators, they are the pillar of
small business in America. And I'm so
proud to know them. I mean, it worked is
my whole point. And so if you're a small
business in America and you are first or
second generation, my message to you is
I have your back. I have your back as I
do for all the companies I've invested
in. And I now work policy also. You
know, I'm just I'm just a guy that says,
"Look, here are the facts. Let's fix
this mistake before it becomes law." And
thank goodness we did. And now I'm a
believer in this bill. Now, are we going
to solve the three trillion? Yes. In the
ways I spoke of previously. Well, talk
to me about how we unlock growth because
as I look at it, it as of right now, my
bet is and I'm literally moving my money
in accordance with this bet uh that
America the bond market cracks within
the next 10 years. My barring uh a
radical change in policy or the
unlocking of growth that that's just
math. So, um
>> well, you're talking you're talking mass
inflation there,
>> correct? So yeah, they're going to
either have to print money or or openly
default. They're both defaults in my
opinion. But how do we how do we open
that growth? Because there is that that
that's a real thing. If we can unlock
enough growth, like we can really do it,
but what would that take? So let's
examine that um uh with granularity
because it's important what you're
raising there. the
in order for that scenario to play out,
you'd have to have a lack of confidence
in the US Treasury bill. Period. You
would have to find another place that
people are comfortable putting their
liquidity in every country on Earth
outside of the US Treasury bill, which
which is considered the risk-free asset.
And so, right now it is. And under your
scenario, in the next decade, that is no
longer the case. It would be more like a
Venezuelan telco bond. And so, you know,
it's is that going to happen? Now, why
would that happen or why why would it
not happen? I want to point you to some
policy uh that is going to become law
hopefully uh to on uh on Friday. Um the
stable coin act. So, let's talk about
the stable coin act, okay? And talk
about the treasury bill and talk about
inflation all in the context of what
you're bringing up here, a lack of
confidence in the US Treasury bill.
Let's just stay focused on that. So
when this law passes and you're a the US
so just to describe this the Genius Act
Hagerty bill Senator Hagerty um we're
going to create a product in America
that is now legal that allows you to
create a digital dollar. So a product
that you buy, let's USDC is the one I'm
using out of a company called Circle and
full disclosure, I was an early
shareholder in Circle. I believed in
what Jeremy was proposing, although
nobody believed him 7 years ago. Nobody.
And today he is, you know, the CEO of a
very successful public company that
trades today that generates and creates
these stable coins. Why is this
important? So if I can I can buy a
stable coin as I do right now and he is
forced by law or this pending law to be
audited for every stable coin he has
it's backed by a US dollar. He has to
prove it to be totally transparent. So
instead of holding paper dollars I could
just own USDC on my phone which I do
right here on this phone. I have
a whole bunch of USDC.
I can send it to anybody on the in the
world I want if they have a
corresponding account and you just
transfer it, which I do.
But think of it this way. Let's go back
to your your your point about the T
bill. Under your scenario, the T bill
has to collapse as a secure uh form of
risk-free investing.
If I live in Turkey, you and I talked
about Turkey just a little while ago, or
I live in Venezuela, or I live in
any unstable regime,
I can take my local currency and I can
buy a stable coin backed by the US
dollar.
The law says this,
it must be backed up
by the dollar or an equivalent including
the T bill under 92-day duration. So,
complete liquidity. Can you imagine if I
had that option in Turkey and I'm just
working there as a plumber and I'm
watching my currency have 12% variations
in volatility yeartoyear. Or I can take
half of it or maybe twothirds of it or
all of it and put it in USDC on my
phone.
I'll buy that USDC even though it pays
me no interest whatsoever
just to have the stability of my trust
of the T bill. So all of a sudden what
you didn't take into account and Ray
didn't take into account is every
country on earth I believe over the next
three to five years is going to take
advantage of an ability to digitally own
something they have faith in the
American economy and the American tea
bill. Now under your scenario and it's
fair you know to be a critic. You're
you're you're arguing that it the
country will continue to mismanage
itself with deficits that at some point
this faith cracks. I'm not there. I
think what's happened with this
legislation is we have found a way to
let every human being on Earth buy into
the trust of the 2-year or or or 90day I
should say T bill. And if there's a
better place to put their money, they'll
put it there. But there isn't because
they're not going to put it in China
ever. Ever. They don't trustqi
at all. And I'm I'm talking about people
that don't have to live in China like
the rest of the world. Who do they
trust? Not the president of the United
States. The American economy. They know
the president's going to change every
four or eight years. But they trust the
way the country operates and how it's
delivered value for 250 years. That's my
argument. And so far it's worked. So I
don't think in your scenario you've
taken into account the innovation
America brings forward. Not the
regulation, the innovation that's going
to solve for demand of the most trusted
piece of paper on earth, the American
tea bill. That's my case. It's a great
debate I'm having with you and I think
the listeners should think about it and
I think I just won that argument.
>> All right. It it is a great argument and
I'm very glad that you're making it.
There are a couple caveats that will
determine whether you win in reality uh
which is are they going to make that
inflationary or is it going to be you
can only buy the debt backing it on the
open market? That would be question
number one.
>> Yeah. Well, in the context of, you know,
the liquidity of the tea bill,
the more liquid it gets, the more the
market determines its value. You'd agree
with that, right?
>> Sure.
>> Okay. So, between Circle and Tether, the
two different stable coins that until
the law was passed, you could call them
rogue if you wished,
they're now bigger than most countries
in terms of owning
tea bills. bigger than most countries,
the sixth largest, and I I think
probably by 24 months from now, they'll
be the third largest, bigger than any
country or bigger than 90% of countries
ownership. And that diversity is global.
I'd argue the people that can own these
things are going to be the billions of
people around the world. And so that's
pure open market price discovery. Your
scenario is going to be very difficult
if it's not liquid. But I'm arguing it
gets more liquid by the second. And the
demand for tea bills, the more the
world's volatile, the more there are
rogue nations, the more people that live
in these rogue nations don't trust their
governments, the more liquid stable
coins will become. So, I think there's
always going to be rogue nations.
There's always an Iran. There's always a
North Korea. There's always a Russia.
All of those people are not stupid
people
in the US bill. They will trust and I
rest my case your on that. And so in my
scenario, your your the probability of
what you're worried about never happens,
which is a lack of liquidity. The
inability to get out of a bill to buy a
T- bill and not be able to to to sell it
for what you paid plus interest. Very
difficult for that scenario to happen in
the way I'm seeing the world coming
together. We'll get back to the show in
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Now, back to the show. Well, so the
question that remains unanswered though
is are these going to be inflationary?
Because the thing that's going to break
people's confidence in the bond market
is very simple that the US continues to
deficit spend. Uh more money is coming
into the world. As more money comes into
the world, prices are going to go up.
You're going to further exacerbate that
dynamic that I was talking about earlier
where you've got all the resentment
because what ends up happening to
nations for people keeping score is they
tear themselves apart from the inside.
So the economy doesn't necessarily
collapse because there's some external
pressure. It collapses because people
start killing each other inside the
country. And so what what I would need
to understand to know because I agree
with you. I think that the Genius Act is
phenomenal. I couldn't be more excited
about it. I think that it really is
going to make what I'm talking about
less likely. However, if it becomes an
inflationary thing where we just anybody
that wants it will make more, make more,
make more, make more, then you are going
to run into call it the same thing that
we see in Houston. So, Houston has
solved the housing crisis uh by saying
we're just going to make as many houses
as we want. Now, that's great, but
people don't exactly rush into that
market. And so, you end up getting
weakness in that market because people
go it's not a good investment. It's
great if I want to live in it. It's not
a good investment. So, if you run into
that same thing where it's like, okay,
um, the US debt is a great place to park
my money if I'm living in a rogue nation
or whatever, but I'm not going to be
using it as the risk-free rate of
return. There's just it it's just
getting bigger and bigger and bigger by
the day. So, I presume that they'll have
to cap that at some point. So, it's not
just like anybody that wants to buy,
we're going to sell.
>> I think that would be
>> I think Well, I I think what you're
saying, and I I think we should make it
very simple. Do you believe we'll never
have another balanced budget again?
That's what you're telling me. If I
believe that,
>> that is what I'm telling you. Yes.
>> Yeah. And so if I believe that, I would
agree you're right. I don't believe
that. I do not believe that every
administration going forward will never
attempt to balance the budget. There is
a growing concern on a bipartisan basis
of exactly what you're talking about.
And so I have you know I understand you
know when you people think of a
politicians they're below single cell
amoeba you know that's I get it I get it
but if you actually um start to talk to
uh you know various members uh both the
Senate and that and you know whether
they're governors or whatever I would
argue now that about 25% of them on its
way to probably 33% % of them uh going
to be tested in the midterms are
starting to become the kind of Eli Crane
kind of guy. A guy I know um who's just
made it his mission to keep calling this
topic up when he's in Washington.
Exactly what you're talking about. So I
think there is a way to balance the
budget. Ron, you know, Ron Johnson has
pointed this out with some very simple
charts of late. uh he's found a way to
find that 2.3 trillion which would get
you there and then even more. Elon has
pointed some ways out uh very difficult
to stomach but there's a path there.
Then you have growth on your side then
you have other forms of income like
tariffs. I'm kind of in the camp that
doesn't see the world you do. And that
is fair for you to take that position
because if you really were going to be
right, I would be increasing my holdings
in hard assets. I would buy more
Bitcoin, more gold, bullion, um probably
collectibles u have proven uh even
watches. I mean, you think about hard
assets uh that have appreciated better
than the S&P. It's because part of it's
because of the concern of where can I
put where can I put my money where it's
protected against that inflated
scenario. Um and and and you're right
people are taking bets like that.
Certainly u you know Bitcoin's been an
extraordinary uh asset and it's not yet
even determined whether it's a commodity
or a security. We'll get that in the
infrastructure act. But I think that the
answer to your question is you may be
right. And if I thought you were 30%
right or 20% right, why wouldn't I just
hold those assets at a 20% allocation?
And I do. So, in a way, I'm hedging my
bets. I'm not as pessimistic as you, but
I have over 20% in hard assets. They're
not liquid, but it's gold. It's it's
it's Bitcoin. It's collectibles. It's
watches. It's certain types of real
estate, you know, oceanfront. Um it's
it's data centers that I invest in which
are an energy play. These are hard
assets and and
otherwise you know I put it all into
4.2% T bills which I don't. So it's it's
kind of in a way I'm admitting there is
a possibility for your scenario but it's
to me no more than 20%.
>> Yeah. No I I think that's smart and like
you I see paths out of it. I just don't
think it's going to happen by accident.
So, in the same way that you are, and
thank you, by the way, going to
Washington DC and fighting for small and
medium companies, which I think is huge,
huge, huge, and I cannot celebrate you
enough for that. Um, I'm doing my part
as a media uh economic commentator to
just try to get people focused on how
money actually works so that they can
start understanding how to move if we
start going down that path. Speaking of
how to move, um I was in Dubai and lo
and behold, I bump into Ray Dallio and I
was like, "Ray, what are you doing
here?" Uh and his whole pitch was, "Oh,
Tom, I come here in Abu Dhabi a lot."
And he was like, "What matters is how
people are with each other." Uh and you
have talked about Abu Dhabi being the
capital of capital. What's going on?
What are they getting right? How are
they hoovering up so much capital? It's
the leadership. It's the confidence
that you get understanding their policy.
They figured out within three
generations,
policy is the only thing that matters.
Why is Abu Dhabi the safest city on
earth? Policy. Why can a woman walk
around there 2 in the morning? Why could
I leave a Rolex on a bench and have it
returned to me to my hotel or a purse?
>> Did that actually happen?
>> It happens all the time.
>> Yo,
>> I mean, it's it's it's an inc to me. I
don't leave my watches on, but I was
going to say
>> people have told me,
>> but I actually wear incredibly rare
pieces when I go out for dinner in in uh
in Abu Dhabi. I don't have I I have no
concern of being robbed there. And other
people feel the same way. I don't do
that in in New York. I can't do that in
San Francisco or Los Angeles. You know,
I I I have uh mock copies of my my rare
uh one, you know, I have I have unique
pieces like one of a kind piece uniques
that are priceless. I wear them in Abu
Dhabi. I don't wear them anywhere else.
But so the point the point is I'm that
confidence as Ry was saying is
understood by people and they have the
most advanced
medicine in the world there. When I go
for when I go to I go to a clinic in in
Dubai called Longevity where I get an
Eboo treatment that I can't get in the
United States, although all the doctors
are American and and Swiss and French
and German with the most advanced
American equipment on Earth. And you
know, I'm I'm a big believer in in IVU,
which is a form of dialysis, but also
injects in 50 billion exosomes, which
reduces inflation. I mean not
inflammation.
>> I wish it could do inflation as well
talking about inflation so much
inflammation and so 14 days later you
feel like you're 20 years old again. So
it's it's really quite something and all
the advancements they have but they've
also invested wisely companies like IHC
and One Development. You know I'm I'm
involved in a in real estate there in a
company called One Development. They
have the most advanced technology going
into their developments. digital walls
that that we don't even have here yet
and and and complete AI technology
that's integrated into the building. So,
it's not like 15 different apps. One for
your music, one for your temperature,
one for your security cameras. It's
completely ubiquitous. You say to your
phone, "Oh, I'm I'm going to be home.
Please open the garage door and set the
temperature at 69°." Boom. I mean, that
kind of stuff we're we're years away
from. They've got it cuz they're
building a and I can't say enough good
stuff about that place. It's just the
only way you're going to find that out
is you have like like Ray figured out.
I'm on the same boat Ray's in. I went
there. I've been going there for years.
I realized there's no place like it on
Earth. They are becoming the capital of
capital. And so if you want to build a
data center here in North America, you
need turbines to convert natural gas
into electricity. that's the path of
least resistance right now. Well, you
got to go there because they were smart
enough to invest in a lot of the turbine
manufacturing capacity on Earth. So, you
make them your partner and you build out
a a facility somewhere in West Virginia
or in Alberta or wherever you're going
for your net gas. I I really
I I would tell people to to study the
policy of that country because what they
basically done is they were students of
every other policy on earth and chose
wisely from each economy and each
geography. What do the what do the
Canadians do to write in their
parliamentary system or the British or
the Australians? What do the French do
in developing the arts? What do the
Germans do in engineering? and all of
that. They took that policy and moved it
to Abu Dhabi and that's what you get.
You get the world's most successful
economy in 50 years like that. I mean,
everybody should be studying what
they're doing. I mean, it it's just
unbelievable. And the the beneficiaries
are the people of that country. But, you
know, you and I could go on on this for
a very long time that I I recommend for
everybody. The resorts are spectacular.
It's a beautiful place. The food is off
the charts. Every restaurant brand, you
know, is there. So, it's just every
every luxury, you know, designer is
there. The malls are unbelievable. The
the the the museums are incredible. I
mean, it's just the whole thing. They're
building a sphere there like Las Vegas
has, except bigger and better.
>> Wow.
>> So, the acts are going to go there to
perform. The whole thing is like and
they've what they've done on corporate
taxes, they've made it so attractive
that guys like Ray and I go there and
set up our companies and we invest out
of there. Of course we do because it's
the path of least resistance. Money has
no nationality.
Now with the USDC thing, you know,
stable coin act, this makes it even
better because the ADGM, the regulator
there is endorsing the SEC policy and
works in sync with the SEC. So now I
>> Interesting. So I don't have to worry
about being rogue when I'm doing
business over there because I'm
regulated with a compliant regulator
that understands they're in sync with
the SEC. The Canadians are doing the
same thing with the OSC. So these
countries are all syncing up with the
policy in the United States. Policy,
right? Not politics, policy. So if we
pass policy in the US and the ADGM in in
in Abu Dhabi agrees and the OC in
Ontario Canada agrees, those are two
geographies I can do business in and
stay compliant. Bingo policy.
>> All right. Talk to me about tax policy.
So right now there is this just burning
desire in young people to tax the rich
uh make billionaires pay their fair
share. Yet when as a business owner I
think about taxes I'm like hey th this
makes growing harder. This makes things
more difficult. So um you're talking
about it there in the UAE. What do you
wish people understood about tax policy
in terms of how it will make their lives
better?
>> The best way to look at tax policy is
consider you're in a competition
globally because money has no
nationality. As I just said it flows to
the path of least resistance. You do not
need to have the lowest tax rates to
win. You simply need to be competitive.
So, if I'm going to spend, as I am, $5
billion building a uh data center, I
need to know the place I put it in and
the state I put it in or the province I
put it in or wherever it's going has
competitive tax rates so I can raise the
debt and the equity that I have to raise
to build the facility. And so if you
know there's a competition what the
great thing about uh North America at
least um is for hundreds of years we've
understood the competition of both
states countries and policy. So, if you
have competitive, you know, taxes,
you're no different than uh the
Netherlands or Finland or Canada and
you're you're uh North Dakota or your
West Virginia. Check the box on that. I
don't have to worry about the taxes. I'm
good there. There's no crazy tax policy.
Then do I have a stable policy around uh
providing building permits and access to
power and employment regulation and
fiber uh you know to get access to the
internet and water policy because I need
water if I'm going to cool my my u my
compute and so it's all a competition
and so what the reason Trump fought so
hard to get this bill through is it kept
him competitive uh against Ireland for
example do you remember the period when
all pharmaceutical companies reset up
their headquarters in Ireland. That's
when the tax policy was out of balance.
And there's a good example of what
happens. Everybody just moves their
headquarters. You don't have to do that
anymore. You can be concerned about what
you've been discussing on on, you know,
uh, spending. I get that, but not on tax
policy anymore. We're we're in a good
place now. And then then you have the
competition of states. I don't live in
New York because I think it's a poorly
managed overt taxed city with a 5 to 10%
risk of having a very unusual person uh
who who's, you know, who who wants to do
money for nothing chicks for free. I
don't want anything to do with that. And
so I quietly, like everybody else, moved
to Miami. All of my neighbors are from
New York and Boston and and my whole
building is New Jersey, uh you know,
Boston, New York City. and they they go
back home for 6 months less a day.
That's the competition of states. So if
you want to have stupid tax policy, you
simply lose the money. People don't have
to talk about it. They just do it. And
12,000 whatever it is license cards a
week being transferred to Florida. I'm
telling everybody, stop coming to
Collins Avenue. We can't handle the
traffic. Please go somewhere else. We're
tapped out. No more license plates from
New Jersey. We just don't have room for
you. You got to go to Texas. Go
somewhere else.
>> That's hilarious. Now, what is it uh
that people are misunderstanding? If we
could capital and stop people from
leaving, would we be able to tax our way
to prosperity?
>> Never. That's not that's not the
American dream. The number one export of
America is not technology and it's not
energy. It's the American dream. The
job, the only job, the most important
mandate the president have has is to
maintain the American dream. So that
every 60 cents of every dollar worldwide
comes to pursue the American dream. The
minute you
>> How do you define it?
>> Well, the American dream is very simple.
It's I have nothing but an idea and I
need to go to a place that respects my
idea, lets me maybe own my idea through
IP law and then lets me work like a dog
to make it come to a reality as many
millions of people have done and
continue to do. Through all of this
rhetoric, we're still generating more
millionaires per per year than any other
jurisdiction on Earth and continue to.
There are more and more and more and
more millionaires in America than
anywhere else on earth. Through all of
the bad stuff and all the rhetoric and
all the unfairness, you can still do
exactly what I said. Have a great idea.
Move from from an oppressed nation like
Iran, move to America, take your
abilities to turn this idea into a
business and bloom. Everybody still
believes that. The minute they don't
believe that is the end of America. And
that's not going to happen anytime soon
cuz it's still a reality. So when people
start to tell me, "Oh, the next
generation doesn't care about the
American dream," I call That's
simply not true cuz the rest of the
world all wants to move here still. And
so I'm sorry when I hear that I that
really gets my eye up. It's not true.
Now, if you want to compete, you have to
set up in any country an environment
that draws in capital. And a good
example and I think it's a fair example
and it's very current as they like to
say oh look at the last 10 years up in
Canada where I invest and I have lots
you know to say about the Canadian
policy under Trudeau the idiot king
capital left Canada over a 10-year
period. The GDP dropped every year until
it stopped growing completely. Even the
Canadian pension plans couldn't invest
in Canada anymore and started investing
in jurisdictions primarily the United
States but others as well where the
policy attracted capital. So the idiot
king put in place a bill called C69
which was called the pipeline bill which
basically stopped all development of
everything mines natural resources
natural gas oil everything shut down.
And the idiot king took his people from
a 10% at the poverty line to 25%.
He impoverished his people because he
was the idiot king. And at the end of
the day, his people threw the idiot king
out and replaced him with a guy named
Mark Carney. Now Carney owns the idiot
king. He's got to fix the idiot king's
policy. How fast can he do it? And what
he's doing right now is running around
the world, and it's probably the right
thing to do, saying, "I'm opening up
Canada for business. I'm going to
compete with the US and other countries
by getting the right tax rate, getting
the right policy, getting the right
ability to bring in permits so quickly
that you can actually not be a risk at a
at a sovereign wealth level." Because
the sovereign wealth left Canada during
the idiot king reign because they they
were promised policies they never got.
So they couldn't do any development. So
they spent all the soft money on
engineering designs and everything else
and the idiot king screwed them. And so
Carney has to reverse all that. But that
goes to show you these this is this is
the competition of nations. And I think
Carney will be successful. And which is
why I am saying wait a second the idiot
king is gone. Why don't we allocate what
we used to allocate 2 and a half 3% of a
fund, which is the GDP that Canada used
to have of the world GDP and put it up
there? We're getting in at all-time
lows. The Canadian dollar has been
trashed by the idiot king. And so I
really think that these these go in
cycles and I like to see competition and
I think that's a and I've been when I
was over in Abu Dhabi, I was pointing
that out too. I brought some of the
leadership from Canada quietly over to
the uh you know the palace and
introduced them to the leadership saying
listen I think we can get in back into
Canada. I think we can we can do some
things there particularly in Alberta
where they've got unlimited power at the
lowest cost in North America. Why do we
put a data center in there?
Why not? And that's what we're doing.
We're saying okay uh they're
competitive. Let's go put a data center
there. And there's only, you know, the
tenants for data centers are Microsoft,
XAI, Tesla, you know, there's 15 to 18
tenants. They go to where the power is
the lowest cost. And right now, that's
under Daniel Smith's uh leadership in
Alberta, Canada. And uh she's open for
business. So, okay, I guess Canada's
waking up from an economic coma was put
in place by the idiot king.
>> All right. I've heard you talk about a
flat tax. Um why would we want to do
that?
Well, I believe in making policy simple
to understand. You know
what I've said about this uh
that the tax policy is incredibly
complicated and it it's not right that
you know I can afford to hire I bet you
I spend
millions every year just preparing for
my global taxes with professionals
>> Jesus
>> accounting firms and lawyers millions
and millions millions of dollars,
millions of dollars. And I, it used to
frustrate the hell out of me. And I'm
saying, why? Why? Why is there so much
friction in the system? It's because the
tax codes are too complicated.
If we just said, look, you know, that
your tax rate's going to be whatever it
has to be, I don't know, 20%. And
everybody has to pay 20%. No ifs, ands,
or buts, no deductions, no BS, nothing.
I think the world would work a lot
easier and and I and I just write my
check, you know, or make it 15 or
whatever you have to do, whatever you
tell me it's going to be great. Instead,
I got to go through all this crap of
trying to figure out this deduction
versus this, you know, advertisation
schedule versus this versus that versus
this.
I don't know. I mean, I I'm just a
pragmatic guy saying to myself, look, I
can't boil the ocean, but I can point it
out. And I think you know your platform
and platforms like this and and
certainly uh you know you it's important
that you you you present both sides of
every argument because that's why you
have value and I think you do a good job
doing that and and so you know I I look
at I look at the tariff wars right now
between countries and I think if if you
told me today that you know let's take
the Canada US one because it's so
current we mentioned it earlier. If you
if they just said, "Okay, it's going to
be 10% both directions." Boom.
Everything else gone. Including the
interprovincial supports or interstate,
whatever the crap it is, no tariffs,
except 10% equal. Boy, would the market
like that. I would understand it. I
could deal with it. I'd adjust my
investment accordingly and move on. It's
the instability and the complexity of
all of this crap that hurts growth. And
that's what we have to figure out. Is
that going to um disadvantage people
that are stuck in a loop of poverty even
more?
>> No. I think it creates a more stable
economy that there's two ways to get out
of the loop of poverty. Education and
stable policy that gets economic growth.
We want jobs for everybody. Everybody.
And the way to create jobs is not
government jobs. It's it's 70% of jobs
are created by companies with 5 to 500
people. They are the ones we need to get
out of the cycle of poverty. In every
community, wherever you are, some
entrepreneur is starting some business
that's going to hire five people. I
don't care whether it's a hardware store
or a car dealership or, you know,
whatever it is, a consulting firm that
helps you get AI into your small
business, whatever it is, that's how you
get out of the site. So, you need
policy, stable policy, you need
competitive tax rates, and you need
education. And so, you know,
we we need to do all three of those,
right? And I think there's, you know, we
could talk I came up in education. I I
was my first company, the learning
company, advanced re reing and math
scores. That's all we did. And I always
said, why aren't we advancing financial
literacy? And thank goodness in some
states like Florida today, they are.
But, you know, everybody
even, you know, when people say, "Oh,
you have dyslexia." I have dyslexia too.
There there's always an opportunity
if you can find the magic of
somehow getting educated even with hard
streets like go work as an apprentice
somewhere. Even if you don't graduate
college, who cares if you if you learn
in an industry you're passionate about
and then you have a great idea. And this
is for a third of America. This is a lot
of people. you know, I I look at a
cohort of maybe uh 900 students that I
teach at Harvard um as an executive
fellow. I just teach entrepreneurship
and and my job I just when I open these
classes up, I look up at all of them. I
say I only have one job here to convince
onethird of you not to become a
consultant and strike out on your own
and form a business and create jobs. You
your job is to create jobs. That's why
you're here, not to become a consultant
where you never make a decision of
consequence and you float of a sea of
mediocrity for the rest of your life.
You and so even Harvard's figured that
out. They don't want to be just a
machine that grinds out consultants.
>> What value to the economy is that? None.
>> I was just going to ask you, so what
what is it about the consultancy angle
on life that traps them in mediocrity?
because after 2 years um of being a
consultant and I'm just you know I look
at that resume and I put it in the
garbage because they they're they now
are infected. They've never learned what
it like what it's like to make an
incorrect decision or a decision of
consequence. They've never felt the
panic and what it takes to make
decisions of consequence where it's a
live or die, where your business is
going to live or die or people that work
for you expect you to lead them out of
the mess that you're in. That that's a
certain talent that that you have to
learn how to do. You need to be able to
learn how to distinguish the signal from
the noise in everyday uh advancement of
a business. A consultant doesn't do
that. They just make recommendations and
they there's no consequence to bad
recommendations. They just get farmed
out to the next job. They bill. That's
all they do. So, so I think listen, I
have I have nothing against if you make
that horrible decision in your life.
It's on you. You did that. You just
become a single cell ammoa in the ocean
of mediocrity and I'm never going to
hire you. And other and know many other
people agree. They just consultants make
really shitty CEOs cuz they've never
done it. And so why curse yourself that
way? Now look, this is not popular with
the big consulting firms. They're not
loving me.
>> I'm shocked, Kevin. How could that be?
>> Yeah. So, but I'm pointing out reality
to these people and I'm very successful
I think in in in and luckily because of
of the new the new leadership at Harvard
which is dealing with a lot of issues
obviously but they understand and I'm
just one voice in this how important it
is to breathe this economic
entrepreneurship into these young people
the smartest people in the world to
understand the difference between the
signal and the noise and to go create
jobs not create consultants.
All right, let's assume that somebody
just heard your pitch. They're now not
going to be a consultant. Uh they're in
the real world. They're making
consequential decisions. They're making
mistakes. Fine, they're early. Uh but
they need you to help them understand
how to begin to parse signal from noise.
Like, I get it. They need to fail. They
need those consequential decisions, but
I've seen people do the thing, but they
just take the wrong lesson. Do you have
uh methodologies? I'm not sure what the
word would be for them to parse out.
Okay, this is what you need to learn
from that mistake.
>> I do actually. It's very simple. Um,
in every day of your decision-m, there
are three to five tasks you have to get
done. And your job is to define what
they are the day before to advance your
business mandate. Whatever it is, I
don't care what the business is. There's
three to five things. Not in the next
month, the next 18 hours after you sleep
and you and let's say you're going to
work, most people work 18 hours, believe
it or not. It's insane, but that's what
entrepreneurs do.
You need to get these three to five
things done. Everything else that stops
you. So those three to five things are
the signal and everything else is the
noise. And your job is very simple. In
the 18 hours of this day, that for me
starts at 5:45 in the morning. Let's go.
>> Can I get my three things done? And I've
learned this years ago. I always make
sure I get my three things done before
anything else happens. And I'm very,
very, very productive. And so,
I learned this from Steve Jobs, by the
way. Um, I worked for him. He was an
absolute nasty guy, a very unpleasant
But he definitely
was 8020 ratio. 80% signal, 20% noise. I
believe I've achieved that. I think
there's only one other guy on earth that
passed Steve Jobs and that was Elon
Musk. He's 100% signal. It's very
awkward for him. He doesn't waste he
doesn't waste any time. But Jobs's point
was cuz I made all his educational
software on the OS for him in schools,
all 110,000 school buildings.
>> And and he would he and W had a pretty
interesting relationship. He understood
that he needed to get programmers,
companies like mine to buy into their
chip, their version of the hardware,
which we did. But he used there was no
text back then. It was, you know, was it
was in the early '9s. And he he taught
me get your three things done. And damn
was he right. I mean, that guy look look
what he achieved until Nvidia. He was
the most valuable company on earth. and
that most of that legacy was on him. He
just focused on things that had to
happen and he would not let anybody get
in the way and and his style of doing
that was very very very difficult. I
mean that guy was just
a brute but I respect him uh because he
he didn't want you to like him. He
wanted you respect him and I do and he
was very successful. So that's my
message to entrepreneurs. understand
that your job is to parse and you have
to understand what is it that I have to
get done just today just today just
today because you will find many many
things that will take you away from
getting it done you'll push it till
tomorrow then you're losing then you're
going to fail and you may your first
venture may you know not make it but
that doesn't matter entrepreneurs fail
multiple times before I had my first
liquidity event today I am laser focused
on the three things I'm getting done
today and and you know and And to to be
uh to be fair to you, you know, Nancy,
who books my 30 minutes u every day, she
has to parse, you know, she knows what
my three things are and and for me to go
and spend an hour with you or whatever
we're spending together some and this is
a credit to you. She has done her
diligence on you and you're worth my
time. I know that sounds arrogant as
hell,
>> but it's very important that I wanted to
do this because I respect what you're
doing and I and I want to be part of
your narrative, but you have been vetted
by one of the toughest women on earth. I
can tell you that and and she would not
waste my time and so I'm not I I
consider an honor to work with you now.
>> Appreciate that. How do you figure out
what the three things you should be
focused on are
>> to I have um
many investment opportunities in front
of me every day. Every day. Some of them
are very very big and some of them are
are important to me as a person and to
to just and I'll give you an example. I
mean this may sound crazy but um we me I
talked about uh the data center with you
that I have many data center projects
but
I have a great team some of them are in
in uh Dubai Abu Dhabi some of the
engineering firms and a huge team of
guys and women working on this and
governments um and so it it's such a big
project it's it's multi-billions that
that's always on the top of my list
every day because I've been working on
it now for 3 years and every day there's
something I have to work on with
somebody somewhere in the world. So
that's number one. But number two today
was
I'm working with Sudiki which is one of
the world's largest uh watch dealers on
earth
to build a piece unique watch out of
Tantel to celebrate watch week in
November. And watches for me are very
important. Uh it's just part of who I am
and it's marked time and then you know
I'm I'm a world known collector. Uh and
I I I'm a member of the horological
society of New York and I work with all
the brands and I you know I I just
respect the whole you know someone gives
up their life at 14 years old to become
a watchmaker. I have a lot of respect
for that. They're an artist so I support
that kind of thing. And so I we we we
want to make the the the watch have a
red stone face
>> and FPJ years ago created such a watch
out of a stone um
a ruby basically a rough ruby and so
I'm I've started to work with some of
the world's top uh stone dealers
uh to to find such a stone that we can
cut the dial from. And I mean this this
is crazy stuff. I mean it's they're the
community that deals in these certain
ruby stones is so small. It's just a few
people on Earth. And so I'm very very
fortunate. Um and I guess I should thank
Shark Tank for it. You know, I'm known
all around the world as the mean shark
and all that stuff. Uh, but I I I get
all my calls returned from everybody as
as the Shark Tank guy. And so, I started
making calls and now I'm negotiating to
get that stone so that we can continue
our mission to make this watch, this
piece unique that I'm going to own um
that's going to come into my collection.
And I'm honored that a watch maker would
even consider doing that for an
individual. But I'm very fortunate now
because many brands do that for me. We
make piece uniques, but my whole stick
is red. Like it's red. It's got to work
with red. And so this this is a Moser uh
watch that is is very very rare. The
only one in the world with a red band on
it made by Moser for me. Uh and I'm
proud because I love this piece. And the
watch that I'm designing with Sadiki is
very much like this except the dial is
going to be instead of being an onyx,
it's going to be a red ruby. And so I
mean that may sound nuts to people, but
that keeps me balanced because I'm
pursuing the chaos of art with business.
And and then then you know lastly um I'm
considering uh a new business um I'm
very intrigued in. I've been looking at
asset classes moving in the markets and
I think many of your viewers are
watching this too. One of the most
successful assets over the last 36
months have been collectibles
>> and they're liquid
sports cards.
>> Watches. Yeah, I was going to say what
are you looking at besides watches?
>> Sports cards.
You know, I I don't want to own one
sports card. I want to own an industry.
And so I'm talking to some of the
largest uh collectors again very
fortunate to be able to get my call
return from all these people saying look
um how can I index if I want to put a
million bucks into an index of cards
let's say 50 60 70 80 cards I see I use
ETFs that's all I invest so my mindset
is is diversification
>> so you know I'm I'm discussing this with
some of the world's largest collectors
I'm not that interested in bidding on
you know one card and having the
volatility of one card. What I'm
interested in is
where can I put my money into 50 cards?
And so
that's how I'm going to solve for it.
And I think uh in the new digitized
tokenized world, I can find a way to do
that. Um cuz I would like to allocate,
you know, you were talking earlier about
um I was thinking I put a 5% waiting
into collectibles like I have right now
in other um hard assets. 5% feels good
to me. And um I'm sitting on a lot of
cash and tea bills. We talked about
that. And so I wouldn't mind taking some
of it out of there into an index that's
it's an alternative asset class. Yes,
there'll be volatility, but generally
speaking, if you have an ETF kind of
structure, you don't go to zero. And I
don't like leverage. So, it's sort of do
it unlevered, that kind of thing.
>> Yeah. So, one last question for you
looking at somebody like Michael Sailor
who does lever himself to the hilt. Uh
how do you think about that? You've got
Bitcoin as this insane asset class that
is just returned, returned, returned. Um
how do you keep yourself sober? Do you
make exceptions or Yeah. Do you just say
this is how I invest and I'm going to
stick to it?
>> Yeah. No, I know Michael. Um I respect
him a lot and and he has um created
something of a unique situation that not
every investor agrees on. My take on
Bitcoin, including in the ETF market. I
don't use ETFs to own Bitcoin. I don't
understand why I'd pay the fees to
anybody to own Bitcoin. And that's part
of the challenge I have with with
Michael Structure. I I don't need that.
I don't need leverage. I just own
Bitcoin, period. And so that's worked. I
I bought it, you know, back at $16,000
or whatever it is.
>> Oh, congratulations, my friend.
>> Yeah. Yeah. Yeah. And and I I I the only
challenge I have is to keep it at a 5%
waiting. So, you know, um and I do I I
I'm you know, when it dips, I buy. When
it goes up, I sell down to the 5%. I I
just have that discipline, but I don't
use leverage. And that's listen, it's
what's done is fantastic. It's worked
for his investors. I don't invest that
way. So my philosophy is simply okay
what's the allocation used to be 3% now
it's 5%. Um
uh part of that's through capital
appreciation but the other aspect of
Bitcoin that I is my philosophy is if
you're going to own the asset also own
the infrastructure that supports the
asset. And so,
um, because if you think about the
philosophy of this, go back hundreds of
years, would you have rather been the
gold miner who hit gold one in 10,000
times or sold the picks and shovels to
everybody that was trying to find the
gold? Turns out on a riskadjusted basis,
you you did better off selling picks and
shovels. So on a risk adjusted basis,
why don't I own a Bitcoin miner, which I
do in Norway and Finland and it's a
private company now. Um it's it's again
a power play. Uh it's called Bitz Zero
and you know I got involved in that
years ago. We were going to put it up in
upstate New York behind the Nigara Falls
which had very attractive power but
there's you can't really do business in
New York that you can't can't get
permits or the policy is unstable. So we
moved that asset to Norway where we got
a similarly attractive power deal off
hydro power and then we're building now
in Finland with nuclear power. So we
mine Bitcoin. Um I now own the
infrastructure.
Um and I I I you know I feel that
between the two of them uh that's the
right way to own that asset class. And
and the other thing is I own the
exchanges. I owned up in Canada an
exchange called Wonderfy. I just got
acquired by Vlad at Robin Hood. So now I
own some Robin Hood. But the point is
he's the he's the infrastructure that I
can hold my Bitcoin on and I own
Coinbase as well. And so that to me is
how you own Bitcoin. You have,
>> you know, that's it. And so, and then we
wait and see uh what happens with the
policy that's going to come right after
they sign hopefully they sign the um the
Genius Act. Then we do the the market uh
infrastructure act and then we're keep
moving down the policy platform.
>> Fingers crossed. Kevin, this has been
extraordinary. I can't thank you enough
for the time. Uh how should people
engage with you if they want to follow
along?
>> Well, kevinly.com or they can follow me
at kevinly tv, which is my name on most
of the platforms. I love the narrative.
Um, you know, I have a great social
media team. I I love I love to be part
of the narrative on policy. You don't
see me shilling for any politicians cuz
I don't do that. But when there's a
policy issue, and I'm enjoying the the
narrative we're having on New York City
Mel race right now. Uh, you can see me
posting all day long on that. And it's
been an extraordinary um interaction.
And I and I love my followers. They're
fantastic. And they really let me have
it, you know. They really let me have
it. I I think I think what's occurring
in the world, this ability to have this
narrative with millions of people is
extraordinary and it's very very healthy
for democracy.
>> Agreed, man. Again, thank you so much
for taking the time. Really appreciate
it. I will certainly be one of the
people engaging with you. Uh everybody
at home, if you have not already
subscribed, be sure to do so. And until
next time, my friends, be legendary.
Take care. Peace. If you like this
conversation, check out this episode to
learn more. If you've ever looked around
and wondered why things feel broken even
when you're doing everything right, the
story sounds simple enough. The rich are
hoarding money and everyone else is
getting screwed. But what if that's not
even close to what's actually happening?
The explanations were being fed