Transcription
For the very first time in world history, there's something new that has happened. The entire globe is riding the same wheel at the same time. Okay? We're all in this debt cycle, and this has never happened before.
The cycle always begins the same way. The first step in this debt cycle is discipline. Discipline equals prosperity. Okay? It goes right into prosperity. And every great empire starts with discipline. Rome did, you know, rebuilding after all the wars with strict budgets and silver coinage and land reforms. It helped restore the, you know, the battered middle class. Dutch Republic did the same thing. They invented modern finance while keeping spending in check, turning a swamp into the world's largest trading hub. Then the British Empire did it after the Glorious Revolution. It brought uh fiscal stability and a goldback pound that the world trusted for over 200 years. When that fell, America did it. After World War II, our debts were manageable. Our currency was solid. We're backed by gold. Our productivity was unmatched. And we prospered. That's stage one, discipline into prosperity.
And prosperity, if not guarded, always leads to the second stage, complacency into excess. Okay. So success creates this fatal illusion. The moment you know that where we all look at each other and go like this is great. It's going to be like this forever. It's always been like this and it'll always be like that. Rome began borrowing heavily to pay for endless bread and circuses. France funded the palaces and the pensions and the perpetual wars through loans it could never repay. Britain in the late 19th century took its global empire for granted and levered uh levered itself uh into World War I. Then came World War II and then America beginning in the 1970s untethered from untethered the dollar from gold and discovered that debt could replace discipline. So the second stage of the debt cycle is the age of entitlement expansion, imperial overreach, cheap credit, and political bribery disguised as compassion. Any of that sound like we've been there, done that? The Dutch called it windhandle, the trade in the wind, paper promises that replace real production. We call it stimulus, easy money, deficit spending. Different words, same exact sin.
That leads you into stage three, financialization. That goes into fragility. This is the most seductive stage. Rome debased its money until it was worth less than 2% of the original silver. Um, the Byzantines watered down their unshakable dollar, if you will, and confidence collapsed. France printed uh their money backed by land until they were worth less and used as wallpaper. Vhimar, Germany did the same thing. They destroyed a thousand years of savings in 18 months. Japan 1990 papered over its real estate collapse with 30 years of zero interest rates. And America after 2008 discovered this intoxicating illusion started by George W. Bush. I can violate the free market system to save the free market system. That's quantitative easing. Money conjured up without cost, without any restraint, without any consequence. In stage three, nations convince themselves they're immune to any kind of gravity. Okay, this time it's different. we can manage this debt. Well, modern tools, you just don't understand that that they'll, you know, the rules no longer apply. Uh, you don't really don't understand. The old rules always apply because math is math. And stage three always ends exactly the same way wherever it's tried. The markets no longer trust the promises they're being fed.
Which leads us into stage four, the breaking point. Every empire eventually reaches a moment where its debts cannot be serviced. They can't be inflated away quietly. They can't be rolled over without consequence. Uh Rome reached it when they froze prices and shattered the last productive parts of its economy. France reached it in 1788 when it could no longer borrow. Uh and that whole thing, you know, came to a head. Britain reached it in 1931 when it abandoned the gold standard. Uh, Viimar reached it when inflation ate the soul of the nation and extremism took over. Japan reached it when its bond market effectively became nationalized, propped up by its own central bank. And right now, America, Europe, China, Japan, and every other major power, listen to this carefully, have all hit stage 4 at the same time. Never before in human history has this happened. The bond markets are shaking. The currencies are all volatile. Politicians are praying that no one notices the numbers, you know, that they no longer add up. Stage four is not coming. We are now living inside the opening act. This is so important. Yesterday, there was a story that said that this is going to be the biggest Christmas season ever. And I'm wondering to myself, I see the prices. I I I I go to McDonald's. I go to the grocery store. I was in Walmart this weekend. I see the prices and I'm looking at the prices and every time I see the prices I'm like, how do the a how does the average person afford any of this and yet we're spending spending spending and I don't understand it. And I fear that we are doing what the government is doing. We're just spending because we can we think we can get out of it.
Then comes stage five. It's called the reset. H every debt system ends in one of three ways. They inflate the money so they can pay off the debt and that's just an absolute wipeout. Vhimar Republic did it. France did it. Rome did it. Just a wipeout. Then there's a hard default and political upheaval. Russia did that in 1917. Argentina did it over and over again. war leading to a new monetary order. That's another one. The Neapol uh the um uh the um Napoleonic Wars, the British gold standard, World War II, Bretonwoods, all of that. But there is always a reset, always a new order that is born from the ashes of the old. And here's what makes this moment unprecedented. Rome collapsed by itself. France collapsed alone. VHimar collapsed by itself. Britain declined while America rose. It was always one country coming down and another country coming up. This time all countries, all countries on both sides, the free world and the not so free world. There's no one rising. China is drowning in its local government debt. It's never going to say this, but it is a paper it's a paper tiger. Europe is fractured and coming apart at the seams. Japan demographic timebomb. America is politically frozen and insolvent fiscally. So for the very first time in world history in every major civil civilization has reached its peak of the debt cycle this time all at the same moment. No one's coming up. So what does that mean? Well, for the very first time in human history, it means when it arrives, it's not going to be regional. It will be global. It's not going to be slow. It'll be systemic. It'll be everywhere.
Now, the hope the history books don't tell um and nobody in the media will tell you this is with every one of those resets, every collapse, every crisis, it created the conditions for renewal. Rome, its fall opened the door for a new Christian civilization. France, the revolution there birthed the modern nation state. Britain's decline cleared the space for America's rise. The devastation of World War II led to the great expansion of prosperity, the greatest that the world has ever seen. So the next chapter is not written. What happens to us is not written. And it whether we rise or fall from what's coming depends not on Washington, not on Wall Street, but on us in our homes and our families and our churches and our communities. The debt cycle is not prophecy. It is a warning. You cannot borrow your way out of moral, fiscal, or spiritual bankruptcy.
Now, I don't feel like I chose this path. I mean, this this with with Brettonwoods and then 1972 coming off the gold standard and what they did in 2008 to bail out all the banks. I didn't have anything to say. Did you have anything to say about that? Cuz I didn't. I didn't. I wouldn't have chosen those things. But the world is putting something together. And I want to show you what our choices are because right now people say, "Ah, you know, I don't like what Donald Trump is doing or I don't like the World Economic Forum or I don't like what China it Okay, great." But I want you to know it's going to be one of these systems because it's being built. It always happens. When one is coming down, some new system, usually a country, but not a country this time, a new system begins to rise. And it happens before the fall.