[0:00]Okay, so just recently the President of the United States gave a speech and a lot of people were looking forward to, hopefully, the announcement of the end of the war. But that's not what ended up happening. President Trump warning Iran the entire country could be taken out if they do not make a deal. Every bridge in Iran will be decimated by 12:00 tomorrow night, where every power plant in Iran will be out of business, burning, exploding, and never to be used again. I mean, complete demolition. In the middle of that speech, the stock market futures dropped. Oil went up even more than before, and Bitcoin went down. And it's all because the Strait of Hormuz, the most important oil choke points on earth, responsible for 20 million barrels a day, is still closed. We know it's closed because of the most important chart you can look at today, which is this one. It shows total tanker transit calls, which are still down. Now, some people believe that if this straight stays closed for another two to three weeks, which is virtually guaranteed at this point, based on what the president is saying, the global economy will then reach a breaking point. Where even if the war stops, it might be too late, and it would start a crisis all around the world. And there's a theory that this crisis was planned as a way to bring about a major change to the world and the monetary system. This pandemic has provided an opportunity. We are now with an economy in crisis, but with an incredible opportunity. It's certainly a major crisis, but it also offers us a unique opportunity. Unprecedented opportunity to rethink and reset. The great opportunity for reset. Opportunity for us to reset. For a reset. The President says, in part, quote, a whole civilization will die tonight, never to be brought back again. I don't want that to happen, but it probably will. However, now that we have complete and total regime change, where different, smarter, and less radicalized minds prevail, maybe something revolutionarily wonderful can happen, who knows? We will find out tonight, one of the most important moments in the long and complex history of the world. 47 years of extortion, corruption, and death, will finally end. God Bless the Great People of Iran! Now what's interesting is that if you look throughout history, every single time there has been a crisis, the end result was more centralization of wealth and power, and here's a few examples. In 2008, the financial system almost collapsed, and within weeks, the Fed invents quantitative easing, where they buy trillions in assets and bail themselves out. In 2020, a global pandemic shuts down the world, and we're told to stay home, and within a few months, governments all around the world are talking about something called The Great Reset. Klaus Schwab, who's the founder of the World Economic Forum, publicly states that the pandemic represents a rare but narrow window of opportunity to reflect, reimagine, and reset our world. Right? Covid was the crisis, and the opportunity was global coordination of everyone's economies and currencies and centralized governments. Your Highnesses, excellencies, distinguished heads of state and government, the future is built by us, by a powerful community as you hear in this group. The point is, there's a pattern throughout history. Every single time there's been a crisis, there was an opportunity for central planners to change how the world worked. Now, I'm not saying that there's some shadowy room somewhere where there's 12 people that plan all this. I don't think that's how it works, but what I am saying is that when there's a crisis, whether it's real or not, the people that are closest to power, who saw it coming, have always used it as an opportunity to upgrade the system in a way that centralized power. So the question that I want to explore in this video is, what is the next crisis, and what is the opportunity to centralize more power? Let me help explain what I think all of this might look like, and with that said, let's get into it. Hi, my name is Andre Jick. Hope you're doing well. Come for the finance and stay for the next once in a millennia lifetime event. All right, so I'm going to spend most of this video explaining the next crisis and then the opportunity in the last part of the video, which I think is probably one of the most interesting things I've ever put together. Okay, so there is a number that economist Luke Groman talks about, which is called the net international investment position. Sounds complicated, but what it measures is America's financial balance sheet with the rest of the world. Like how much of our stuff do foreigners own versus how much of their stuff do we own? And why is that important? It's important because if foreigners own a lot of your stuff, they have more influence over the value of it, if, for example, they decide to sell it for whatever reason. Ideally, you want foreigners to own less of your stuff in a conflict situation. Okay, so right now, that number is negative 87% of GDP. What does that mean? To put it in perspective, after the First Gulf War, it was only negative 7%. After the Second Gulf War, negative 12%. After the 2008 financial crisis, it was still only negative 15%. But then something happened. We just kept selling assets. We sold our stocks, we sold our real estate, our treasury bonds, and who did we sell it to? We sold it to China, to Europe, to Japan, and to anyone running a trade surplus against the United States. And that is why today, foreigners own about $70 trillion in US dollar assets. 9.4 trillion of that is US Treasury bonds alone. Now, here's why that might be bad. Those same places, Europe, Japan, China, Southeast Asia, are also the most dependent on oil going through the Strait of Hormuz. And that straight is obviously closed, but they still need to buy oil, and oil is priced in dollars, so they need dollars. Now, I've got a question. Where do foreign governments and central banks get dollars from when they need them really fast? The answer is, their dollar assets, right, their US stocks, US bonds, their US Treasuries. They have to sell them, and that's already happening. Foreign central bank holdings of US Treasuries at the New York Fed just went down to the lowest level since 2012, and in four weeks, tens of billions of dollars are gone. And that's just the beginning because it'll probably get worse. Why is it going to get worse? It's going to get worse because when countries sell Treasuries, Treasury yields go up. And when yields go up, the cost of financing America's almost $40 trillion debt goes up as well. Now, the most important bond to look at right now is the 10-year Treasury and its yield, which was in the threes when this war started, but it went up in the last four weeks. Now, the question is, is there a point at which bond yields hitting a certain level breaks the economy? Like how high does this number have to go for things to start to get really bad for everyone in the US economy? And according to the best research I was able to find, the danger zone is somewhere between 4.6 and 4.8%. And once we get there, we could enter into what they call a debt death spiral. What does that mean? It means the more expensive it is to borrow, the bigger the deficit. Bigger deficits mean more borrowing, more borrowing means higher rates, and it's a never-ending loop. And at almost $40 trillion in debt, that spiral happens really fast, which is also why Jerome Powell said what he said recently about the debt growth rate in the US being unsustainable and ending badly. It's not necessarily that this $40 trillion number is too high. It's that it's growing faster and faster and faster. And that's bad because that doesn't just burden our generation, but future generations as well. So the question is, what can the US do about it? There's three possible outcomes, and here's what they are. Outcome number one, let yields go up, right? Let the market do what it does. Treasury yields go to five, six, maybe higher. That crushes the US stock market. Why? Well, because investors would rather take a guaranteed 5 to 6% return in the bond market than risk it in the stock market. And because stocks and tax receipts, AKA what the government collects in taxes from us, those move together. And when markets go down, tax revenues go down. So deficits explode. Housing gets weaker. Consumer spending collapses. Banks take losses, and we enter into a recession. And because of that negative 87% net international investment position, this recession triggers a debt death spiral that sort of takes the rest of the world with us. Not good. Outcome number two, print money at the same time oil prices are going up. The Fed steps in, it does what it does, quantitative easing, it buys Treasuries, it caps yields, and it does what's called yield curve control. It saves the bond market, but you're also putting liquidity into an economy that's experiencing an oil shock, and that causes inflation. Economist Luke Roman thinks that we could see inflation that makes 2021 look mild, double digits, maybe worse. Outcome number three, walk away from Iran. Just announce, okay, we won, we're leaving now, right? We did it, which might sound like a good option. Except here's what's going to happen if the US picks option three. The rest of the world watches America start a war. It watches the US fail to reopen this major shipping lane, and the world watches as the US retreats. Okay, why is that bad? It's bad because if the US picks option three, the world then realizes that the US is not as powerful as it used to be, and it doesn't have the influence to restore order. The policeman of the world sort of lost his gun, right? So the media will then start putting out headlines that read, is Iran the US Suez Canal moment? Pay attention to some variation of that headline. If you're not sure what it means, this this comes from Luke Groman. It means it is the end of the US Empire. Because remember, before the US Empire, it was the British Empire that ruled the world. But Britain lost that status because of its Suez Canal moment in 1956, and it never recovered its global dominance. If the US retreats and fails in restoring this order, it sort of accelerates every country's decision to price their oil in something other than dollars. Countries would say, okay, I guess I don't need to use dollars anymore because the US can't protect me and it can't enforce the rules anyway. I'm going to trade with other countries in whatever currency I can find, right? Which also means a weaker dollar, which is also inflationary. So every outcome sort of leads to inflation and a weaker dollar. Now, the question is, of all these three options, which one is the US going to pick? And based on everything we know so far, the option that the US will most likely pick is going to be option number two. They print into rising oil prices, and the Fed's balance sheet, which is right here, which was $9 trillion at its peak and has been shrinking, starts going back up into a crisis.
[12:02]So money printer go brrr again, if you remember that from 2020. The technical term for money printer go brrr is, of course, quantitative easing or QE. That is the option the US will most likely pick, but there's a very big catch because there's different types of QE. One of them does not affect your investment portfolio, and the other one does. Let me explain which QE I think the US will pick. There's type one QE, which is what the Fed did in 2008. That's when they bailed out the banks. It's considered non-inflationary. It did not trigger a spike in asset prices. The rich did not get richer. Well, technically, yes, the bankers that got bailed out got richer, but the market assets did not inflate. Why? Because remember, the financial system was collapsing, right? Banks were sitting on mountains of toxic, worthless mortgage assets. The Fed stepped in and bought those bad assets directly from the banks. That cleaned up their balance sheets. Right, at face value, there was no new money that entered the broader economy. The central papa bank was like, hey, it's okay, guys, we'll forgive you for all those bad loans you gave out. Don't even worry about it. Right? It's essentially a cleanup, and it happens completely within the banking system without the money flowing into the real world. That's also why 2008's QE didn't cause significant consumer price inflation. Right? That's type one QE, AKA money printing. Type two QE is what happened in 2020. And this one is completely different. Instead of buying assets directly from the banks and then just forgiving them, the Fed bought assets from non-banks and corporations and pension funds and regular institutions. And when that happens, those sellers deposit the money into their bank accounts. So banks are now forced to create new deposits. New money floods into the broader economy, and people have more buying power. But the supply of stuff in the world didn't change. So then what happened? Prices went up. Not right away. There was a lag of about 12 to 18 months. The Fed did huge type two QE money printing in March 2020, and then 18 months later, inflation hit 9%. The original economists who created this term QE actually warned this inflation would happen, but nobody listened. Instead, the media told us this. These were the headlines. Here's why economists don't expect trillions of dollars in economic stimulus to create inflation. They were all wrong. In 2020, BlackRock presented this exact type two QE at something called the Jackson Hole Conference. They essentially told the Fed what the plan was, and then six months later, BlackRock went ahead and did it. Now, how all of this is related to what I'm talking about is that option number two is the option that the US will have to pick. Printing money into the oil spike. The inflation that might happen after that could be a lot higher than 9%, 12 to 18 months after that QE. That would make this graph much, much worse. Right? This is where economic growth slows down, and inflation goes up. That is called stagflation, and it's very, very bad. Okay, so that is the setup. That's the world as I see it, and the next important question of this video is, well, what is the next phase? What comes after this? What is the opportunity to centralize power? And here's the best theory that I've come across. In order to understand it, you have to put yourself in the mindset of these central planners, the people who influence the world's policies. Here's the core problem that they have. The first major problem is AI and automation. Once AI is allowed to be unleashed into the economy, it's going to displace a lot of jobs. It's going to be painful because not everyone will be able to adapt. But let's say they do. Let's say, optimistically speaking, AI becomes so productive that we find ourselves in a perfect utopian world of abundance where no one needs to work. What's going to happen then? I think, inevitably, we're going to need some sort of universal basic income. If that happens, though, that's going to give society way too much free time, and people will start waking up. They'll start organizing. The political process becomes a real thing again. And that's not good if you're a central planner, because you want to be in control of that system, and you want people to be reliant on it. And you want people to be too busy thinking about how to pay their bills, right? That's problem number one, and it needs to be solved. Problem number two, though, is the US is almost $40 trillion in debt. It's growing faster than the economy, and now with yields going up, the cost of that debt is growing faster and faster. So how do you solve that problem? The way to solve it is that you find someone else to hold the debt for you. You distribute it to the entire world, but instead of distributing it through inflation, right? Because that only works as long as you're able to export it, as long as other countries want your assets. But what if they don't? Right? And what if the next distribution phase is not the institutions?
[17:42]What if it's through people? Right? What if the best way to distribute this debt is already in everybody's pocket? So here's what I think the next phase of this new monetary system is going to look like. In a nutshell, what I think will happen is the US debt gets privatized and uploaded to the world. Right? Every major corporation will become a bank. Every major app will become a wallet. And every person on earth with a smartphone will become an unknowing creditor to the United States government. They will solve the debt problem and the AI problem at the same time with a digital currency system that funds the government, controls the UBI payments that feeds the people that lost their jobs to AI in the first place. And it gives the central planners a button that they can turn on or off for every single person's financial life. Okay, hold on. That sounds crazy, right? What does that even look like? All right, so imagine Tesla announces a digital wallet. You load it up with dollars. Tesla takes those dollars and invests them into US Treasury bonds earning, let's say, 4 or 5%. Tesla keeps a little, passes some back to you in the form of rewards, discounts on your next car, maybe charging credits, maybe an actual yield. Right? You're happy because your money's working for you. Tesla's happy because they're earning a spread on their deposits, and the US government is happy because someone bought more of their debt. Now, multiply that across every major corporation on Earth. You'll get Apple Wallet, Amazon Wallet, McDonald's Wallet, Google Pay with Yield, every airline, every retailer, every platform we already use. All of them will become distribution channels for US government debt. All of them holding US Treasuries as the backing for whatever digital asset or rewards program they'll offer you. Now, if that sounds like some crazy theory, this is literally what the legislation moving through Congress right now requires. It's called the Genius Act. And what it says is, any company that wants to issue a stablecoin, a dollar pegged digital asset, must hold US Treasuries or equivalent safe assets as the backing dollar for dollar. Which means corporations will have to buy real government debt first. And this has already been successfully tested with a company called Tether. The company behind the biggest stablecoin in the world, it holds over $120 billion US Treasuries right now. That makes them one of the biggest holders of US government debt on the planet. In fact, bigger than some countries even. And Tether was the system's test. Now, imagine this same dynamic, but with the brand recognition of Tesla, the distribution of Apple, the loyalty programs of every airline and retailer we already use. You're not asking people in Argentina or Vietnam to trust some sketchy crypto company they've never heard of. You're asking them to trust the brands they already love and use in their own countries, brought to them by the courtesy of freedom. And in exchange for that trust, they'll get yields, they'll get discounts, they'll get utility, they'll get to protect their savings and purchasing powers from their corrupt dictators and governments, right? Now, behind the scenes, they become creditors to the United States government. That is how you offload trillions and trillions of dollars in debt globally. All you need is CBDCs, legislation, and eight billion smartphones. Now, unfortunately, this system, as convenient and generous as it sounds, is also going to be the most sophisticated financial control grid that will ever be built. And the reason I say that is because it's also already been tested. Tether has already frozen wallets. It's happened dozens of times. It has sanctioned addresses, it's flagged accounts, it's regulatory requests. All it takes is a line of code, and they can turn your money off. Now, you'll still own your money, technically. It just might not work on Tuesdays or in certain stores to buy certain things. Or if you said something the algorithm didn't like, or you didn't get vaccinated, or if you bought too much meat that week, and meat is energy intensive, and we need to conserve energy, right? That's just Tether. It's a relatively small private company, but scale this capability to a system where every major corporation's digital wallet is going to be susceptible to US regulation, backed by US Treasuries, governed by US law. And I think you're going to get something that makes the Swift banking system look like peanuts.
[22:48]Now, Swift can cut a whole country off from the global financial system. That's a lot of power. But this new system will be able to target anyone, no matter where they live, even if that country and its laws prohibit this system. It's already too late. It's outside their control. So what are they going to do to fight that? You will start seeing them disable the App Store and turn off the internet. That's how they're going to fight it. And the beautiful, or maybe the terrifying part about this is that no one forced anyone into this system. We've already all signed up to it. So I don't know what the next crisis will be, whether it's going to be stagflation, hyperinflation, nuclear war, a 9/11 type event, a false flag, or maybe energy lockdowns where no one can travel, but regardless of what it ends up being, I think this digital financial control grid with CBDCs is their opportunity. Now, the question I had for myself is, what can I do to protect myself against any of this? And a great piece of advice I saw was from Catherine Austin Fitts, who says there's three things you can do. Secure real assets, use cash and build local, skill up and network. And I think that's good advice. Beyond that, the way I'm thinking about this for myself is to self-custody. I want to own and protect my own assets. If I can hold a physical version of an asset like silver or gold, for example, I will prefer that to the ETF version. Physical gold is the oldest monetary asset in human history because it doesn't need an institution or a network or a government to work. Because remember, in 1933, Roosevelt made it illegal to own gold, and you stole it. Could that happen again? Maybe, but physical gold held privately is still the hardest to asset to track and freeze and digitally disable. It's been money for thousands of years for a reason. And it's the same concept with Bitcoin for me. I've always preferred to self-custody it rather than buying the ETF version of it, which is also why I teach people how to do that step by step in a link down below, because I think there was a cost to guaranteed safety that I'm not willing to pay it. Now, the third thing I'm doing is trying to stay informed. Because the most dangerous thing about this whole system is that it's complicated, and it's supposed to be. And most people, I think, will walk into this without understanding that this is happening. The people who do understand will hopefully make better choices. They'll hold assets outside the grid, and that is why I like to make these videos. I genuinely believe that understanding this stuff, even if it's wrong on the specifics of it, but right, directionally speaking, that it puts me in a better position. But regardless, I highly encourage you to please do your own research. You can also find my personal portfolio and track your own investments at FunVest.com. And if you're interested, Webull is still running a promotion where if you fund your account, you can walk away with a free $60 cash bonus. If you bring in over 100,000, that jumps to a 4% match, so $4,000 free on 100,000. So they'll also cover up to $100 in transfer fees, and the nice thing is, Webull is SIPC insured, so your investments are protected up to half a million dollars, and I've been with Webull for over six years now. Their link is down in the description as well. In the meantime, I'd love to hear your thoughts and theories and what you're doing to prepare. As always, I hope you have a wonderful rest of your day. Smash the like button, subscribe if you haven't already. I'd love to see you back here next week. I'll see you soon. Bye-bye.
