The Collapse Is Set: Ray Dalio EXPOSES The Hidden Forces About To Crush The Economy & America

To me the economy is like a chessboard. Once you see where all the pieces are, you can get a sense of where you are in the game and um what is most likely to happen next in the near term. As you look at the set piece right now of a a right-wing populist leader coming into being elected, uh where do you think the economy goes from here? Everything that happens has causes causes to make it happen. And so there's a it's like a machine. And um so there are five major forces that work together to determine how this thing works, the changing world order. The world order is changing. Those five forces are first a money credit money debt force. In other words, the way that works is you get credit, that's buying power, it produces debt, you have to pay it back. You but the buying produces economic output. So there's that cycle. You have too much debt, you have a problem, and you have to go through an adjustment process. There's a mechanics to that. The second one that you're talking about is the internal order and disorder, um changing domestic order. And as you point out, um there traditionally there's the left and the right. And that's uh you know, Democrats and Republicans. And there are times when they're very very different and they're fighting to win at all cost. And and that could be disruptive, um and how that works is important. The third one is the international order. There's a system of how countries operate with each other, that's the order. And there's a dynamic for that. Number four is acts of nature. Droughts, floods, and pandemics are a force, a big force. Nature is a big force. And so climate change and so on is important. And number five is technology, man's inventiveness that produces technologies. They have an effect and they all interact. So, what you've done and what I as you've brought us back to what is the most inconsequential development of that second force, this internal order and disorder. Fortunately, we had a situation where there's a fairly clear mandate and they were not arguing about about the elections. So, we've had an orderly transition of power from the left, the Democrats and so on to rather hard right. And so, what does that represent is your question. That represents two important forces. I'll I'll say them give the headlines and then go below that. The first in reforms, internal reforms to reform the government and to reform the country and certain ways that I'll get into in a second. And second internationally for the preparation for war doesn't mean we're going to have war, but to be prepared for war and to have a type of war with the rising power, China and then it's allies, China, Russia Iran and and North Korea are considered that other side. You're going to see the country run and the government run a lot more like a capitalist business in which imagine a new leader comes in and you have an old company that's not doing so well. Maybe that's IBM or Boeing or something. And they're coming in and they're doing a renovation. And so you're going to see technologies be used. You're going to see a game game plan develop to make the government run in a more efficient and cost-efficient way. And you're going to see what we call an industrial policy, which is a policy for the country, the business to operate that rather than a purely free market economy. In other words, it'll have direction. You're going to see deregulation. You're going to see uh changes in legislation. You're going to see an emphasis for it to be uh productive and to be effective with an eye on what that means internationally and the competition. For example, in technology, you either win the technology war or you lose the technology war. The technology war uh means if you win it, you win it economically. Uh whoever the winner is will win it economically and will win it militarily. So that internationally we have that same competition. That changes the role of the United States. We have an America First policy. Okay? Not no longer the world order as it was. The world order as it was after uh World War II was that uh how do we work with each other in those countries? What are the rules? And establishing a rule-based uh what we would say also a moral-driven uh type of uh uh world order in which there are multinational organizations such as the United Nations, the World Bank, the World Trade Organization, uh the IMF, uh and all those organizations operating by a set of rules. That's obsolete now. We now have an America first policy in which then other countries then are increasingly pressured to be with us or against us and now you're seeing this line up in preparation for what side are you on? So that is the change that we're going to see and we are in the process of developing. How disruptive do you think this change is going to be to a potential international conflict? Is this going to see a rise in BRICS where that really becomes a threat to the US dollar or do you think that there's a way to do this well where tensions settle down? You're going to have more strong-armed conflict, a much more muscular power and testing of powers and and getting around that. You're going to have much less following the United States. It wasn't long ago that the United States only had to hint at some countries what it wanted and they would get the message and they probably pretty much fall in line because that was the order and also the power of the United States. Now that's no longer the case. And so you're going to see a more fragmented policy in which most countries are are interested in how what's good for them and how do they pursue that. So you're going to see some countries align with one side or the other and most countries in the world not aligned and do deals. And so that will be a much more fragmented type of policy. So yes, BRICS will rise. BRICS countries, which are the let's call them the non-aligned countries generally speaking, although part of that is China and Russia. That's part of the BRICS part of that. But it is the non- US dominated, non-G7, non- European countries that are creating this alternative. Now, what that'll be is they are not all in agreement with everything, but they do think they have one thing in common. And that is to get out from under the American seat system or to be controlled by the United States. So that lends itself to doing those things that'll reduce their control, such as developing an alternative medium of exchange and perhaps an alternative storehold of wealth. I don't think they're going to develop an alternative storehold of wealth, but I do think we have our storehold of wealth, which is Treasury bonds or bonds. We're going to have problems with that. So anyway, it is that alternative organization that is not the US dominated world order. That also by the way constitutes about 85% of the world's population. And now counts Yeah. And so you're going to see a shift in that direction. The idea of the United States dominating and being so um controlling is no longer going to be the case. It'll be a power, it'll certainly be a great power, but um it's it's BRICS inter uh um each pursuing their own interest in deals um in a more interesting in a more independent way is a is part of that. They do not The world sees it differently. The United States sees it and in the way I just described. In other words, there's internal How do I control the internal? And then how do I deal in an America first policy with the outside world? Um the most of the world says, "I don't want to get involved in your fights and your arguments. I don't want I don't care what you want. You're pursuing your self-interest." And instead, I have my own developmental issues, and I'm not going to follow in the same way. That's the characterization of what it is like in the world. All right, this is a really classic pattern. So, what does this mean for us in the US? We've got a leader now that is going to be very muscular, uh going to be aggressive, uh sort of metaphorically anyway slapping people around and saying this is how we're going to do it. Uh he's threatened to do 20% across-the-board tariffs. Um how does that play out domestically? Does it isolate us from the rest of the world and end up putting us in a position where we can no longer export our inflation, and that becomes a dramatic problem for uh our debt and the value of the dollar? Or is this the posture that needs to be struck right now so that we can solidify, bring manufacturing back on board, get the dollar strong? How How does this play out? Um think of it as operating as two different systems. And so, you're going to have two different technologies in the world. For example, Uh uh there's going to be a China-based technology, there's going to be an America-based technology, and they'll be two separate technologies. And the technology is how they're handling their economy? No, I'm referring just to you know, this AI, all tech all of those technologies because they are a threat to each other Got it. So, they're going to stop doing global trade? nobody wants to trust what's in here. So, for the and and they need self-sufficiency. If you're in a war, you're not going to you can't be dependent on parts or things that are going to come in from other places that could be shut off. So, you're going to have this you're going to see a lot more conflict and you're going to see a lot more economic independence. That is going to um undermine uh efficiency, but benefit self-sufficiency. Okay? So, you the goal is in in 2030 to have 20% of the key chips be able to be produced within the United States. But, think about them. They're being produced in Taiwan, which has this geopolitical thing going on, and that's a scary thought. So, you're going to see that. You're going to see then the support in an industrial policy for enabling that. So, there'll be protectionism, there will be tariffs, certainly those ideas that in that stuff coming in will make it more expensive because you no longer could go to the world supermarket and buy whatever's most cost-effective for you, but it will at the same time develop those uh industries. This was very much like Germany after World War or or Japan. Um This is very much you know a policy that is a more autocratic controlling the economy directing it to be self-sufficient with protectionism and so on. So that will be stimulating to those businesses. We have a number of businesses which are not their national championship champions, but they may not be the most efficient. And so you will see the desire to bring in capabilities from other countries producing chips. Boeing has a problem. The main you know, where are we going to get it? So you will see foreigners coming to produce within the United States. Um but it was going to be much more focused within the United States to make it more capable, more profitable, and more independent. So that's what that piece is going to look like. Okay, so to me the vote recently was the revenge of the working class. It was people saying that my wages have not gone up in real terms since I think the 1980s. They're feeling that they I think that the average person if they don't believe that their child's future is going to be better than their present that you run into this anger, frustration, and people lashing out. So given that that's the setup internally as we begin to do an America first policy, as we begin to make things more expensive by putting on tariffs, um even though I get the long-term play of we need to prepare for a war that may or may not come, but we have to be ready for it. Uh and so we're going to do things that increase the cost of goods, but make us more resilient. How is that populace going to respond? Are they going to get more pissed in the short term because it's like, "Hey, you're actually making things worse?" I think it I I I think it depends. I will make the argument for what those who are um creating this and and behind this would say. I think they would say, first of all, that the tariffs can raise a lot of money. And they can raise a lot more money than wealth taxes, for example, or some of the other taxes. And so, they have two benefits. They will bring in tax money. And they will create a protected environment. And if we And so, yes, that'll mean um higher goods prices. But if you take that tax revenue and um you know, in a sense, taxes are of a type of inflation. If you raise taxes, it's a type of inflation on people. Okay. It might not might not be in the consumer price index, but it's taking money out of the pockets of people in the form of taxes, too. So, they would then say that what we will do is we are going to improve productivity in the United States by these operations. We're going to enable, but we also are going to improve productivity. And so, those improvements in productivity will help to offset the higher cost of tariffs because money moves around that way, you know? So, if I can get a dollar out of a tariff, or I can get a dollar out of taxes, I have to think, "Where am I going to get the most dollars? And what is getting it mean in terms of taxes? And what am I going to do with that dollar? And so, there was a belief that by running the country like a company, in a sense, to be able to make it productive, and to by supporting that, we will get self-sufficiency, we'll get greater security, and we'll get greater productivity, which will make the country better than if it's operating highly inefficiently, depending on imported goods to be cheap. Fair. So, let me ask you from the economic side of this, modern monetary theory would say, print more money and give them more resources. Why doesn't MMT work in reality? It doesn't It doesn't work in reality because there is It's a It's a It's a very basic thing. There's a debtor and a creditor, okay? The creditor has savings, and so, in saving, they want to receive a return on their money, and if that money does not provide them with a real return, they'll put it into something else, gold, something else, and so on. So, you have to have interest rates that are high enough so that the creditor gets a good return, but not so high that it breaks the back of the debtor. And when you have a lot of that debt, and so on, that balancing act, because one man's debt is another man's assets, you have that balancing act, it becomes more difficult. When you print money, you do not make productivity. You just make more money. Money doesn't have any value, okay? The more money you make, it's okay, double the amount of money. Wouldn't it be wonderful if we just could double the amount of money and then I I benefits from it, but it doesn't give you anything, really. Okay? It's only productivity that gives you something. So, the idea that I'll print more money and give it away is a transfer of wealth, essentially, from uh that um undermines proper lending of money. Um and and because that balance has to be taken care of. Are you wastefully producing the money? Or are you productively producing the money? And the cost, like anything else, make it free, okay, and you're not going to have it um well handled. It's that you're going to produce more inflation. So, and if you are in a position where you make interest rates not high enough for the creditor and not um and and that balance, then what you're going to have is inflation. You're going to have that money coming out. And worse than just the new supply of money is that people won't won't want to hold the debt instruments that they're holding. Cuz the way that storehold of wealth is, when you hold a bond, you get this money that everybody's printing, and it's going to go down in value, okay, and you don't want that. You'd rather hold it in some things that are going to hold their value. And that's basic. Okay, this this is so fascinating. Uh very helpful. This is actually beginning to clarify my thinking on this moment. You've talked about there needs to be a Manhattan Project for the economy, that you want to get the smartest people that the US can get their hands on and sit them down and give them in grand um task of, I think what you're referring to is the beautiful deleveraging. That we have so much debt, we have so much inflation that we have got to find a way to tame this. Um, what would the Manhattan project look like? What would be the stated goal? What I would have liked best We'll be right back with Ray Dalio, but first, gold is a very smart way to protect your wealth, but you can't exactly break off a piece and buy groceries with it. That's why I'm excited to tell you guys about Goldbacks. Imagine having the protection of gold in a form that you can actually use. We're talking about physical gold currency that you can spend it over 2,000 local businesses. Buy coffee, get your car fixed, or pay for dinner, all with actual gold units that are designed for everyday transactions. Here's why this matters. Goldbacks gives you real purchasing power that's protected by gold. Plus, you can even earn passive income by leasing them out up to 3.5% paid in additional Goldbacks. Last year alone, people exchanged over 34 million dollars worth of Goldbacks in local communities. Ready to protect your wealth in a way that actually makes sense? Go to alpinegold.com and use code impact to get started with Goldbacks today. Go to alpinegold.com and use code impact to get started with Goldbacks today. And now, back to Ray. What I would have liked best is the recognition that, um, the majority of the people have to be behind policies. You need reforms. You definitely need reforms. You need broad-based reforms that includes things that have not been mentioned in this plan, such as education. The most important thing that you need, I believe, is quality education that provides broad-based skills and also teaches civility, so the country operates well and creates Well, but anyway, whatever So, that we have we cannot simply get there if we don't have a policy that is that everybody believes in that you work towards. So, my idea of the Manhattan Project was to get the most skilled people from both sides, not the extremes, but the extremes frighten me, because you're going to have a war between one set of extremes and another set of extremes. It's not going to be good. And you can't neglect a population that that is going to perhaps be neglected by these types of policies. Capitalism will not do it all. So, as the result, my Manhattan Project was working making bipartisan. What I would have preferred is a is a bipartisan cabinet, by way of example, to be able to bring together the smartest and the best, and then you engineer How do you create the reforms and you get the majority of people behind it? So, that's what I meant by that type of Manhattan Project. But we are going down this path. And you know, and many people believe that this is the path, just like people believe that the other path, let's say the Democratic path, would have been a different path. So, we're on this path, and we hope that that path is successful in making those renovations to be able to um raise productivity. We We certainly need renovations. And if it delivers, them people will be happy. I am worried about the areas that they won't deliver, but that's always part of it. And this is the plan, and so we, you know, everybody can argue about the plan, so much so that you can't execute a plan. Okay, this is the plan. And you know, I hope they do it well. You are having in the particular appointments that you're having is non-compromisers. You are having extremely lo- um loyal and uh black and white uh strong people who will not compromise much about anything. And so that's what's going to happen uh over that administration. And in order for them to achieve their goals, they're going to have to prioritize. There are a number of things they want to do. Uh the first 100 days of an administration is very important in terms of the uh what's accomplished, and certainly the first two years is critical because there are midterm elections and everything can change depending on how that goes. And so you're going to have to see prioritization of things. How much What are we going to do in um immigration? What are you going to do in trade and tariffs? What are you going to do in technology? What are you going to do in in energy policies and industrial policies? Capital markets, deregulation. All of those things are on their list. They're going to have to now these aspirations are going to hit the realities and and come in conflict with those realities. Uh laws will have to be changed. There and it's and to change laws is complicated and so on. But there's a determination that that some of these things most of those things have to be done in that period of time. So I think you're going to see very forceful actions during that period of time. and prioritization. You said that there were certainly things that you were worried about. We'll see how they play out. What are your biggest worries? What could the non-compromisers get wrong that would be very problematic? I think they they can um overdo things in a way where the thinking of some parts of the population who are left behind and are not benefiting from that um could be important. I think that they're forgetting about education, for example. I think I think the most important thing to reform is to affect children at a young age to be able to be to do be of good character and good capability and I'm seeing that education is not going to be pursued. And I think that um you know, there can be such an alienation of the other side um that uh you know, that that that presents a a problem in in the longer run. So but I understand that perspective, you know, and that they um have to make those decisions and and get them through and that's what a renovation looks like. If you would take a company, how do you renovate a company? You might cut back a lot on the workforce. You might create lots of disruptions to get that company in good shape and that's basically what the attempt is um going to be by people who think who have done those things and are inclined to do those things. So um All right, so if The people part of it the establishing a minimum standard, let's say of education and um civility. You know, I'm I'm very much exposed to the poor underprivileged people. I'm in Connecticut. My wife works to try to help um those who are living in school districts and areas where there's gangs, there's poverty, there's terrible education, there's It's It's an environment that if I was to live in those environments, I would be a revolutionary. Um and you know, how do you establish that foundation that nobody falls below? That there's a certain level of How do you deal with that? I don't think that that's going to be well dealt with, but you know, um uh Tough choices are going to have to be made and those are the choices that the new leaders are pursuing and so I've answered your question about what I think some of the risks are. All right, so if Elon and Vivek come in and start hacking and slashing away at the government and reducing either size of department or eliminating departments altogether, do you think that will be recessionary or is that going to free up human capital to go into the private sector? I think the key is whether it improves productivity or worsens productivity. It's how that's done. For example, if you intro- has consequences, but let's just imagine you introduce technologies, you get rid of a bureaucracy that stands in the way of progress. I'm now painting the good one. And so on. And so it's like a company that all of a sudden all of a sudden have a bureaucracy, doesn't have waste, and has technologically advances, and it produces things more efficiently. Um that is good for the company. The country as a whole did that way, that would be good. But it still creates a situation where what are you going to do with the people who are useless or nearly useless? How is What are you going to do with those? So it's hasn't answered that question. If it is not working that way, and not effectively done, um it'll be disruptive without those benefits. So I think, you know, uh I admire um maybe it's not exactly the way that I would do it, but I admire the uh attempt to make um that kind of revolution that believing that uh them believing that that is the best way to do it, and I can tweak it, but I would say productivity per person, broad-based productivity, is the most important. They are emphasizing productivity. I'm not so sure that they're emphasizing broad-based productivity because broad-based productivity means that each person is productive, and then they are that productivity gives them their income. So, the broad-based part of it is of a concern to me, but productivity is a good thing, and so it's worth their try. Okay, broad-based productivity, is there any way to get to that other than educating the young? Like, is there a way to take the adult who now is going to be wildly disrupted? If they're a government employee, they get ousted from their job, they have to find their way in the public markets. Do you think you just sort of have to set that aside and like focus on the youth, or do you think there is a way to get current adults broadly productive? You have to. And that's what I worry about not being adequately tended to. You have to deal with that population. All So, let's The question is the Is there a way? But before we get to a way, I would say you must find a way. Because if you make a lot of useless people, um you're going to have your the same kind of problems and a worse problem with all of those useful people. Not good for them, and they're going to be disruptive to the society. So, you must find the way. And I worry that there's not enough attention to being given to that issue of finding the way. So, now, can you? I'm Look, I'm not an expert on jobs programs and you know, and and how that works. And I'm not a big believer that the government is the best, most creative ways of, you know, government efficiency is an oxymoron. So, when you, you know, would you like your whole government to work the way the Department of Motor Vehicles works? You know, it's it a problem. No, so how you do that um is not as being neglected. And I I think that's the basis of a problem. So and young people, yes, and it's that's being neglected. How you do that um at a young age, and I'm saying you have to teach them two things. You have to educate them the skills. We have measures in the world called like PISA scores. Where is the United States for the average school? Um we have 60% of the population has below a sixth-grade reading level. You have to improve that education. And you also, not just in the formal education, you have to teach civility. How people can come out and work well together to be productive. And those are the areas that are being neglected, in my opinion. Mhm. Okay, so before we go down the education path, talk to me about the So this group that is potentially going to get disaffected if we start reducing the size of the government, focusing on efficiency, we know that we have to deal with that population. Um let me give you a terrible idea, just spitballing here, and you tell me how we potentially make this good. And Hurd, you're not a jobs expert. However, uh when we look at economic policies that are likely to create opportunities in the private sector that they can be absorbed in, because I'm making the base assumption that the private sector is going to be the far more efficient with human capital than the government. So um I buy into the idea that if you release them from the inefficiency of a government job, as long as there's proper incentive in the private sector to onboard them, you could really make use of them. Uh would something like leveraging tariffs instead of income tax, is that like an absurd idea and we're never going to be able to get rid of income tax? Or is that the kind of thing that could be so stimulative uh that we could then absorb those people into the private market? Well, you're talking about two things. Where you get the money from and then what you do with the money. So, where you get the money from, tariffs, um as I mentioned, if if that money that you get from tariffs is used to raise productivity better than taxes. That's a good thing. What do you do with the money? The question still remains though um what is the plan to do with those people? Who who let's say artificial intelligence will replace a lot of people. Um you you know, people get upset about the uh Chinese imports. Um and the Chinese imports are less impactful in jobs than technology and they're also giving you a cheaper product that has some benefit because you can more cost-effectively get it. When you have um technology replacing jobs, that you know, that can make it the items um more cost-effective, but it also can disrupt jobs. And so we still come back to your question of what happen what is the plan for um those people whether of any age later or earlier. What is the plan to do with them? And who is going to execute that plan? That's what's missing. Uh and and there are no easy answers. Does the government do it? Well, the government is not very efficient in doing things. And what does that mean? But anyway, the government won't do it. So, we have those consequences as a result of this, and we just have to realize that. That's that would be the type of thing that if I was saying Manhattan Project, it would be that kind of examination of what is the the plan for those people. What I'm trying to put my finger on is there's a euphoria in the markets since Trump was elected. There is a sense of uh I'm I'm going to guess this is my read of the situation that people are looking at this and they're saying, "Okay, here is somebody that's pro-business. They're going to be deregulating. They're going to be reducing the scope of the government. If anything, they're going to reduce taxes." And so, people are saying, "Okay, there's going to be massive investments into businesses. That's going to make the stock market go up. They're also pro-crypto. So, there's going to be more innovation on that side as well. And so, you see Bitcoin is mooning. Uh you see the stock market is going up. Now, I don't know if that's pure optimism or if mixed into that is a belief that Trump is also going to continue to print money, continue to deficit spend. And so, they also need a place to um sock away their assets. So, I'm not quite sure what the best way to read this is, but if it's the first one and this is just optimism, there's going to be deregulation, reduction in taxes, massive investments into business, um that feels like a very hopeful signal when you think about people losing government jobs and needing a place to go into the public markets. Do you think that's a misread? I think I think everything that you said up until the last part um is it perceived and I and I agree with that kind of an assessment. Uh So, what I mean is there'll be less taxes. Um it's more capitalist. It's good for the markets. Um there'll be more uh efficiencies. It's all of the things that you said. But, um it still doesn't And And they'll be Both By the way, both of your scenarios, there'll be more um uh there could be deficits. It'll be monetized by the Federal Reserve. And one way or another, they'll control the interest rates through um but they'll print more money in order to do that. And there'll be things happening. Okay, you've done a good summary. It still doesn't tell me how that's going to deal with those people. Okay, so um the only thing I have for you at this point is something very vague, which is if private sector stimulated, then more jobs. And therefore, anybody leaving the government sector that wants a job is more likely to have that opportunity. I don't think But, it is vague. I I I don't think I don't I don't think so. I think um um those There's the government people leaving. And then there's the vast majority of the population who are being disrupted for other reasons, such as technology having efficiencies. In both cases, they're um you're going to have technologies increasingly replacing people. Now, um you're going to break the world into two types, by and large. There's about 3 million people who account for most of the benefits that of the new technologies, you know, the unicorns and such. It's a wonderful environment. If you go to the great Americans schools that um are these the rarefied environments where you're among the brightest and you learn and you come out and you get jobs or uh a lot of the people half of the people are immigrants who are very talented from different countries and 3 million people about half of which uh are immigrants are really uh doing the amazing technology work and at creating unicorns and so on. And that it's a country of 333 million people. So, how we broaden that um there will be those who invent the technologies and do very well and then there will be the a lot of people who will be disrupted. And they're not going to be able to just go from a government job in which they were operating a certain way into the workforce. And you know, they what I'm uh okay, what's my background? Government bureaucrat. Okay, now I'm, you know, a 52-year-old government bureaucrat uh looking for a job. I don't think that there's going to be a you know, a great job market for that those people. And that's the government part and then there's the others who will also be disrupted. So, any There needs to be There needs to be attention paid to this. Okay, there needs to be attention paid to this. Fortunately Fortunately, the government is not great at this because also, you know, it's like uh the pri- the private sector wants efficient people. Not people who are like that. By and large. And the government is not good at disconnecting themselves with the companies. They can train a lot of people. You can spend a whole career being trained in this program and this program and never end up being productive. So, that's a problem. That is a problem. Uh so, I my in my darker moments where I'm just being blunt with myself, the thing I would say is uh anybody that is unable to make themselves productive in the private sector, you just have to give up on. Like the your only other option is every kind of social safety net. Once a social safety net gets put in place, then people are groomed to find their place in the social safety net instead of being groomed to find their place in a productive workforce. Uh I don't see a way around other than slowly finding a way to um let the the markets decide who has value and who doesn't. And it sounds gross to say, but I don't see a way around that. Do you? Like is there a lesson we can learn from Singapore or has Lee Kuan Yew solved this problem and I just don't know about it? The answer Most supplements don't work and most supplement companies are banking on the fact that their fancy marketing is going to hide that their product actually falls into the placebo zone. But when I found out that there was a company partnering with Dr. Andrew Huberman, I knew it was worth taking a look at. So, I want to tell you guys about Momentous. What they are known for is their obsession with quality. Every product is NSF and Informed Sport Certified, the exact same standard used by professional athletes. When they say what's on the label is what's in the bottle, they mean it. And with the holidays coming up, taking care of yourself is more essential than ever. So, I'm excited to tell you that Impact Theory listeners get exclusive early access to Momentous' Black Friday sale. Until November 25th, go to livemomentous.com and use code impact for 25% off everything. Plus, spend $75 or more and get five of their best-selling sleep supplement packs absolutely free. Again, that's livemomentous.com and use code impact for 25% off through November 25th. Slow decisions are more likely to kill your business than wrong ones. The only mistake is standing still. The problem is most companies are running on five different systems, making speed impossible. NetSuite solves this. NetSuite brings your entire business into a single source of truth, giving you the visibility and control to make quick decisions. Over 40,000 companies trust it because you get real-time insights that let you spot opportunities before your competition. While they're still closing their books from last month, you're already acting on next quarter's opportunities. Want to move even faster? Learn how AI is revolutionizing business decisions. Download the CFO's guide to AI and machine learning at netsuite.com /theory. The guide is free, just go to netsuite.com/theory to get your copy. Again, that's netsuite.com/theory. The answers start with how you educate your young people. When they get older and they're ingrained and they don't have the capabilities or they and they don't have the civility, you have people who are very difficult to make useful. And it's roughly a 10-year cycle. That 10 years is not very long. But having excellent education, establishing a a bottom so that everybody is being I think the most important thing to change and improve a society is to have an education system that the majority of the people can have a bottom in their conditions to be educated and to live in a civil environment. That is the lesson not only in Singapore, but it's the lesson throughout history in all all places. Think about you and those around you and the generation of raising children. Think about how you were raised and raising children. The most important thing is raise your children well. Okay? The children they learn these things in early life. And they learn their approach to life at an early age. And so they not only do get the skills, but they get the approach. You know, ethics, behavior in the society, not to if you're in raising children in an environment where there are guns and shooting and drugs and stealing and you make your money because you do those things and then they grow up, it's very difficult. So I do believe that the lesson of of these places is that you should make those things go well rather than deal with them go going poorly. Why does America have a hard time and its values uh one generation to the next. There are a few reasons. Um First, each values comes from the particular parents that have the biggest influence on those values. Um and we are living in a society in which there's um uh competitiveness also determines the resources that you're living living in. And we have a society in which by the Constitution education, formal education, is a state issue, and then it comes down to a tax district issue within the state. So, what you have is a situation where if you don't have the parents and you're in that environment, um let's say for example, I live in Greenwich, Connecticut, and the um the public school system, I think at the average per student expenditures 28,000. In Bridgeport, Connecticut, which is 10 minutes up the road, and they don't have money, the average expenditure's something like $14,000 in school. And then uh they need more money because that's not just the amount for education, but if you buy them a computer, you have to buy them a computer. School doesn't provide that. So, some get computers and some get don't get computers and and such things. And they're living in an environment where there's drugs and shooting and all of those things. And and that's a more dramatic environment. So, ref- reforming that is more difficult and expensive. You have those two different kinds of environments. So, who are your parents? How did they raise you? Do you have the education and the civility Do you have those resources? You know, that these are the fundamentals and the basics. So, to answer why don't we learn, your question was, you know, why don't we do that? Why don't we learn? Well, that parent who is now, you know, maybe drug addicted at 14 or 15 years old becomes the parent. What kind of parent are they going to be? Mhm. So, you have the spiral that worsens. That my my wife uh who deals with this this issue um uh sponsored a uh an examination in the state of Connecticut and looked at, you know, who are they and what are the costs? And there was um BCG, she hired BCG to do the study and it and it did this examination. And it showed that uh besides this human tragedy, as I say, in the state of Connecticut, 22% of the high school students have either dropped out of high school or are failing classes with absentee rates of greater than 25%. Yo. in the state, which is the always number one two or three richest state in the country, okay? Because of that, that has created almost a plague that has then caused crime and incarceration. They're spending $700 million a dollars a year on incarceration, okay? So, it's been shown that it is so cost effective that if you didn't even care for the people and you were just saying, "What is it costing the society?" It's costing the society a huge amount of money that if you fix this thing, if you would deal with those things, then only would you have a fair society for education and so on, but you'd save money. And you have a more civil environment so that in that environment there's greater safety, a better community, people want to be there. So, that's a reality. So, that is uh it So, I'm just trying to answer your question. Um If your parent was one of those parents you'd be raised that way. Yeah, I've seen this problem up close. So, as somebody who's in manufacturing and long personal story as to why I've spent so much time in the inner cities, but uh to me it seems pretty blatantly not to be a money problem. It is an ideas problem. The problem is, to your point, place that you get your ideas is from your parents. If your parents got bad ideas and it becomes a self-fulfilling prophecy. Um zooming in on education. So, the hope would be that kids walk into schools a kindergartner and we start educating them well. We're not doing that currently. The Department of Education is coming under increasing scrutiny. Um what are your thoughts about the principles that make and I don't want to put words in your mouth. For me, I look at that and I go, "If you have a system where you can't fire people that are underperforming, if you have a system where you don't hold people accountable to KPIs, of course, that system is going to derange. That you have to fundamentally make it so that the best and the brightest make it to the top, that they get paid a competitive wage that attracts high-caliber talent and not just people that have a big heart. Um what do you think is the read? How would you actually pull something like this off? I would I would say everything that you said is true, but there's much too much emphasis on that relative as being the problem relative to the fact that um the amount uh uh there are teachers, many many wonderful teachers who are having to be in these environments and are under under-resourced um not appreciated they're going through they're take money out of their own pockets to try to give things that you know, there are not in some of these schools adequate basic things like pencils. And they'll take money out of their own pockets. So pour money into the system, will it solve it? Sorry? If we pour money into the system, would it solve the problem? Um we're dealing uh no, I think you need both. Okay. Um uh uh you when you're describing it, you're describing it as a one-dimensional problem. Okay? Meaning as I hear you, that there are lousy teachers, you're not holding them to KPIs, and so on. And I'm agreeing that that's true. But to characterize that as a one-dimensional problem and not deal with the other part of the problem is a mistake in my opinion. And that other part of the problem, for example, in COVID there were 60,000 students who would not get computers. That would mean that they would not get education. Jeez. Okay? Okay. So, uh we fortunately we have the resources, we bought the computers, but if we didn't buy the computers and get the computers. Connectivity, they don't have connectivity. So, when you're dealing with the other part of that issue, which is that deprivation, $14,000 versus $28,000 in an environment like that, if you yourself were in there and you were a teacher, I know people who are wonderful teachers who are in those environments and so on, you have no idea how hard it is because of those things. So, when you ask me, um would pouring money into it be helpful? Let me say with um pouring money into some things like basics, like okay, every child has this basic set of circumstances. If you take the good teachers who are doing an excellent job and you distinguish them from the bad teachers and they are doing an excellent job, you will have a better system, a better education system. I'm not the guy to fix the education system. I'm not telling you, but I'm just saying that when I look at it up close, it's not as simple as sort of saying that, you know, there are bad teachers and so what you do is you have to look Yes, you have to I'm hearing you. I agree with you on that, but you cannot ignore this other part of it, which is the starvation of resources and the general environment that they're living in. Food. I mean, the kids come to school to get the food cuz they don't have enough at home in their various ways. These are issues. Yeah, no, I agree and in my own defense, I was merely trying to set you up to give your take versus giving my whole take, but where I come at it from is you have a system where even if you pour money into it, I don't think it's going even though I agree with you that you want parity across the board, but if you look at some of the things that are going on with the charter schools, they don't come in and solve the problem through money. They come in and solve the problem through a value system. And the value system alignment of discipline, focus, hard work, expectation We disagree on something? I No, no, no. I I I merely wanted to put forward that I agree with you it's not as simple as But I think the problem is So, now we agree on that point. And now let's go back and step back and say that won't happen. Okay. So, we can uh I think we're in agreement, or we could debate the question of what should be done, but now let's step back and when we're talking about the changes that are taking place, we have to recognize that not that won't happen. And you're going to have dark sad, depressing, but uh I the cons. This conversation, if I'm understanding it, is to look at the pros and cons of the of what's happening. The pros are you're going to take on reform, and you're going to, you know, and and and and that can have a lot of beneficial effect in a lot of different different ways. And then the con is well, we could do all our debating, but that is not going to be happen. The There'll be no changes in any material improvements of taking that thing that we're talking about, taking that on to make that better education, then that's going to be a con. I'm not more realistically doing this. I'm not idealistically doing it. I'm just anal- analytically doing it, okay? And that's what it looks like, right? Ray, I cannot tell you how much I cherish my time with you. Uh I know you have a new initiative going on. I would love you to tell me and my community a little bit more about it. Well, I think you're it's it's not a new initiative, but I'll but I'll tell you I think you're speaking about um the um charitable gifts. Okay, so I'll tell it the specific name is? His Best. His Best. Exactly. Okay, His Best is a vehicle. Let me let me describe this. About 20 years ago um I didn't like typical giving at Christmas because people waste so much you know, they buy the junk that they give as Christmas gifts and so on. Um the amount of giving of candy at Christmas is greater than the amounts of money the annual budgets of the American Heart Association, American Cancer Society, and Habitat for Humanity combined. Okay, I can't because somebody's got to give candy and it becomes decadent and so on. And so it occurred to me about 20 years well, more than 20 years ago that if I know that you're charitable and that I would if I gave you a donation to your favorite charity that um that that you'd appreciate that as a gift not my favorite charity, your favorite charity and that you would appreciate that as a gift and we together could give that and and the ban- benefits of that is it goes to those who were excited to have it go to. Um if you're not charitable, it's it's not a good gift, but if you are charitable and it also makes the holiday spirit more in keeping with the holiday spirit and it's a whole lot easier shopping to do. And and it's tax deductible, too. So, I mean, like it's got a lot of benefits. So, anyway, so I would gave a lot of those out, and 20 years ago, I started a campaign for how to do that for individuals and companies cuz I found out it was great. And then when I did that, it it caught on. And so, 20 years ago, I started to initiate that. About 5 years ago, I found this organization TisBest, and TisBest makes that really easy. I used to send out checks that were basically blind blind checks that they would fill in who to send it to. But this now organization's fantastic because it has all the charities you could imagine on it. You put that in, they will do all the work and get it out there. So, 5 years ago, I started to do that, and as you know very well cuz you've been also helpful in this regard, that what happens is what we do is we introduce that to people. So, every year, a few of my friends and I want to give that experience out to people. And the way we do that is we give away money. Um It could be we figure out every year maybe it's a million dollars, maybe it's a few million dollars to people for that purpose. In other words, you can go sign up, and you yourself can get the money to go to your charity, or you can take that and give it to somebody else to go to their charity charity. And so, it doesn't cost you a dime, you just go through that experience. And we've done this. Um we're going to do this again this year. Um the By the way, the money for the charity goes in about 5 minutes. So, if people want to pay attention, they may pay attention to it because even though it's a significant amount of money, it goes very, very quickly. And uh that experience has turned people on and turned companies on to doing that practice. So, I want to bring it to attention that this is a great way for holiday shopping in many, many ways. It's a great way for holiday shopping for the recipient who is a charitable person. I love it. Ray, thank you for sharing that with us and sharing your time to talk about this uh very fascinating economic moment. As always, thank you for joining me, man. I appreciate it. Um it's always a pleasure. You're a force for good. Thank you. Same same to you, Ray. All right, take care. All right, everybody, if you haven't already, be sure to subscribe. And until next time, my friends, be legendary. Take care. Peace. If you like this conversation, check out this episode to learn more. You could ask yourself, what do we celebrate? My income isn't going up as an individual. I'm not making more money, but this guy's got $200 billion. The US doesn't know pain. Like, we have no idea. There's a world where we embrace technology where we say we're not going to be fearful of loss, but we're going to pay