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The Future of the U.S. Economy: Bonds, Inflation, Hard Assets & What to Do Now with Jim Lynch

Episode 52 · 10 December 2025 · 1 hr 4 min

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The Future of the U.S. Economy: Bonds, Inflation, Hard Assets and What to Do Now

What is the future of the US economy, and how should everyday people think about it? Bond-market veteran Jim Lynch returns to talk debt, rates, inflation and hard assets with Randy Lorensen, Dr. John Oberg and Anthony Marino.

What’s really happening with the U.S. economy—and how should everyday investors prepare?

In this episode, bond-market veteran Jim Lynch returns to break down the debt crisis, interest rates, inflation, the bond market’s hidden risks, and why he believes hard assets may be the only real protection moving forward. The hosts press Jim to simplify the confusing parts: what “fiscal dominance” actually means, why the 10-year Treasury isn’t responding to Fed cuts, how purchasing power is quietly eroding, and what the next 6–12 months could look like for the stock market, real estate, and Bitcoin.

This episode is packed with clear, actionable insight for anyone trying to understand the financial landscape—not financial advice, but a roadmap for understanding what’s unfolding and how to think about your own next steps.

Jim also revisits his predictions from earlier this year—many of which have played out—and shares what he believes comes next as the U.S. faces unprecedented debt, rising global instability, and an economy dependent on liquidity injections.

The Bond Market in 2026, the Cantillon Effect, and the MOVE Index

What you'll discover:

  • Why the 40% in a 60/40 portfolio is broken, and what changed in the bond market in 2022
  • Fiscal dominance and the debasement trade, explained in plain English
  • Payday loans for groceries, the Cantillon effect and the K-shaped economy
  • Is it a good time to buy a house, and why the 10-year Treasury isn't falling when the Fed cuts
  • Jim's predictions for 2026, and the indicators he watches: the MOVE index, credit spreads, oil and gold
  • The Fourth Turning, Dalio's debt cycles, and where a black swan could come from

Timestamps

  • [00:00] Abundance Briefing: checking Jim Lynch's predictions from earlier in the year
  • [01:58] Welcome back, Jim Lynch, lifetime bond trader
  • [04:01] Ten months after his one-word answer for two students: Bitcoin
  • [05:11] Jim's disclaimer, and his advice for young people starting out
  • [07:10] Growing up as a boomer: every generation thinks it had it hardest
  • [09:37] The 60/40 portfolio: why the 40% in bonds is broken
  • [11:05] The 80-year bond bear market, and what changed in 2022
  • [13:16] Fiscal dominance: why we can't kick the can down the road anymore
  • [14:17] What inflation means for the everyday person's purchasing power
  • [15:44] The debasement trade: assets since the pandemic in dollars, gold and Bitcoin
  • [17:45] Pricing a house in Bitcoin
  • [21:38] Hard assets, and why Jim wouldn't buy long-term bonds now
  • [22:08] Record stock returns, a $2 trillion deficit, and why rates have to come down
  • [24:42] Austerity vs. a productivity miracle
  • [25:43] Iran, missile math and global instability
  • [28:05] Credit for his DOGE call, and why he thinks the U.S. will "go through hell"
  • [28:56] What does "hell" look like? The Fourth Turning and Dalio's debt cycles
  • [30:45] Save the bond market or save the country
  • [31:50] What if every country prints money?
  • [33:41] Payday loans for groceries, the Cantillon effect and the K-shaped economy
  • [35:33] Why the stock market is too high, and why it can keep going up
  • [36:49] Why cutting spending or Social Security won't happen
  • [38:54] Buy hard assets with leverage? Why Jim says not now
  • [40:43] Is it a good time to buy a house?
  • [44:28] What a negative net international investment position means for a household
  • [45:42] Real estate, gold, Bitcoin and a diversified portfolio
  • [47:19] Why the 10-year Treasury isn't falling when the Fed cuts
  • [51:39] Who's buying America's debt?
  • [52:35] Short-term bonds and the different kinds of bond risk
  • [54:14] Predictions for 2026: a new Fed chair and lower rates
  • [55:29] Indicators to watch: the MOVE index, credit spreads, oil and gold
  • [59:08] Jim's two largest positions, and AI's power-grid problem
  • [1:00:17] Liquidity, and what would change his outlook
  • [1:02:00] Growth rate vs. the 10-year yield
  • [1:03:11] Takeaways: get your $20s out of the pillowcase, and where a black swan could come from

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About Jim Lynch

Jim Lynch is a bond-market veteran with 40 years in the bond business. He first joined Tales of Abundance in Ep 17, Financial Sovereignty with Jim Lynch, and returns here to check his earlier predictions and look ahead to 2026.

Views expressed are the guest's own and are not investment advice.

Hear Jim's first appearance:

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Related episodes

Meet the hosts: Randy Lorensen · Dr. John Oberg · Anthony Marino

Transcript

A full transcript is below. It comes from the episode recording and has speaker labels and time markers, which line up with the published audio. It hasn't been proofread, so expect some errors in names and terms.

Randy Lorensen [00:10]: Listeners, welcome to Tales of Abundance. Today's abundance briefing is going to be a little bit different. I am here with Dr. John and with Anthony, but we have a guest coming up shortly. One of our best performing episodes ever was when Jim Lynch was on at the beginning of the year, right after the election, making some predictions. And during the episode, we talk about some of those, but I do want to give people just so you understand. where he's coming from. So some of the things that he predicted, and this is an AI summary, but long-term bonds will underperform badly was one of his predictions. Well, that's continued to happen for the last year. He predicted that there will be a major financial crisis or didn't predict, he said there's a good chance that we'll have a black swan event. You know, some kind of serious black swan. That has not happened and he specifically predicted it was hedge funds, but it's only been a year or 10 months. So it certainly could be coming. You know, the prediction, his other prediction is that the Fed Treasury will not allow a prolonged stock market crash. And I think that's really true, right? Well, the economy hasn't necessarily been in the best shape. The market's up 20%. So they're going to fight interest rates and all that. he definitely did that. Anthony, John, you guys got any comments? on any of these that you want to add in on those first three at

Dr. John Oberg [01:38]: for people listening to the first episode for this upcoming episode that we're about to release is to me much more actionable. Like to me, we were able to get more into the, does it mean? How do I take action? And there's a lot of things that went over my head, but I was able to get Jim to really kind of bring it down to my level. I appreciate it. think the listeners are going to enjoy.

Randy Lorensen [01:54]: All right, that's great. Listeners, we will talk to you after the break and we'll be back with Jim Lynch.

Randy Lorensen [02:00]: Listeners, welcome to Tales of Abundance. As always, I'm here with Dr. John and with Anthony, and we have a special guest back today for his second time on the show, Jim Lynch, a lifetime bond trader, and we are going to get into the state of the economy. So, John, I know you've got lots of questions for Jim. I'll turn it over to you.

Dr. John Oberg [02:22]: It is a super interesting topic for me because I'm probably the least knowledgeable on these sets of topics for you, and Anthony. Like I know the least. I'm super interested in personal finance. I'm super interested in like, how do I grow and protect wealth for my family? Like those are interesting topics for me. But Jim, think, you know, from your perspective, you're starting your 40th year in the bond market next year. Super exciting. Maybe. We'll out more about that in a minute or two.

Anthony Marino [02:30]: .

Dr. John Oberg [02:49]: So you've got a lot of experience here. And, you know, for a guy like me, who's like, just, I've been following personal finance for a long time, it's never been a profession of mine. There's lots of information that I could listen to that and be really scared, too scared. I could be really optimistic, too optimistic. But giving people a real sense for like, this is the lay of the land. These are the choices you're faced with. Different people will make different choices based on what they think is best for their Individual situation. We're not giving financial advice today because we're not anybody's financial advisor But like this is it's mean it's an interesting place to start Anthony You and I were talking before the show like you had a couple places like hey, let's kick this thing off from the very beginning So do you want to ask your question now and just jump right into it?

Anthony Marino [03:23]: you Yeah, sure. In your first episode, you talked about a meeting you had or an engagement you had with two Texas, University of Texas students who either recognized you or somehow divine that you were an expert in finance and bonds and what have you. And after they asked their questions, you told them, you said Bitcoin and just it was one word. That was it. And so here we are.

Jim Lynch [03:47]: Hmm. Hmm.

Anthony Marino [04:03]: 10 months, 11 months later, life has been a bit tumultuous in terms of Liberation Day and Bitcoin's tremendous rise and fall. I won't call it a fall, but readjustment, you will. If you met those two students today, would they be more than one word or how would you approach them?

Jim Lynch [04:24]: No. Same way. Same way.

Anthony Marino [04:28]: Okay, the belief is the future is Bitcoin. All else in my portfolio is of no use.

Jim Lynch [04:38]: No, I wouldn't say that. I wouldn't say that at all. We're going to get into this. Let me first start off by saying welcome everybody. And yes, Dr. John noticed I have my Christmas sweater on and it is December 8th. Merry Christmas, Happy New Year. I hope everybody had a Thanksgiving. Anthony referenced. Oh, OK, yeah.

Anthony Marino [04:40]: Okay. Okay.

Dr. John Oberg [05:01]: Hold on, your sweater says, I want for Christmas is Bitcoin. You can't see it.

Randy Lorensen [05:06]: Yeah.

Anthony Marino [05:07]: you

Dr. John Oberg [05:07]: All I want for Christmas is Bitcoin. Of course, I would expect nothing less from Jim, but go ahead.

Jim Lynch [05:08]: Okay. right. First of all, nothing you're going to hear today is financial advice. I am not representing any financial firm, not even my own. I'm here because I'm friends with these three gentlemen. I like their podcast and I think I could offer some help. So the story that Anthony is referencing is a few years ago, I was walking down Second Street in downtown Austin, and these two kids from UT stopped me and asked me if they could talk to me. And I said, sure. And they said, what would your advice be to two college kids coming out of any college, but obviously UT being here in Austin? And I said, look, there's two things I would do from the get go. Just get in this habit. I said, save 10 % of your income and tie 10 % of your income. And they were recording this and they thought that was pretty interesting. And, you know, they said anything else. said, yeah, you want to be your own boss. You want to be your own entrepreneur. And they thought that was really great. And then I said, and then they appeared to stop the recording. I said, well, you know, let me rephrase this. If you could allow me. you know, 30 more seconds. And, you know, and let me say this, I hear a lot of talk on Twitter, X, any social media website. And the big thing I hear these days, everybody picks on boomers. The boomers have had it so great. The boomers this, the boomers that. You know, you know, I'm a boomer. I'm right in the middle there. Every generation blames the prior generation. It's happened for thousands of years. You know, if they didn't do this, if they didn't do that. And, you know, the boomers have had this great 40 year run. Well, let me tell you how it was growing up as a boomer. In the early 1960s, we were doing air raid drills because we thought we were going to have a nuclear war with Russia. I don't think there's any issue with that today.

Dr. John Oberg [07:11]: you

Jim Lynch [07:26]: In 1963, President Kennedy got assassinated. 1968, his brother got assassinated. Then Martin Luther King. So by the we got out of the 60s, most of us didn't think we were going to live really that long in life because everybody just killed each other. then in 1965, we went to the Vietnam War. Go read your history books. Tell me how great of a war you thought that one was. and by the way, when we went to buy our first home, interest rates were at 15, 20 percent. I bought my first house at 13 percent. And the people people are complaining at seven. I was double that. My buddies and I in the early 80s, we never thought we would buy a house. I'm hearing the same lingo today. I'll say this to any generation, any millennial out there. I'll swap. You take my money. You take my age, 68. I'll take being 25. And the reason I would make that trade and a heartbeat, because you guys got the greatest investment in the world at your doorstep. Don't take advantage of it. It's OK. And what I told those two kids from UT, just buy Bitcoin. That's all you need to do.

Dr. John Oberg [08:50]: So Jim, that's not a Bitcoin message. That's a message that's as old as age, like time itself. Like youth is wasted on the young.

Jim Lynch [08:59]: Hahaha

Randy Lorensen [08:59]: you

Dr. John Oberg [09:01]: I mean, I think every generation has said that, right? Like, I think most generations would say with what I know now, I would go back and do it. That's fair.

Jim Lynch [09:02]: Yeah. Yeah. Yeah, look now to answer Anthony's question, like is it only Bitcoin? Obviously not. Now, are there some people putting all their money in Bitcoin? Like there's people who put all their money in gold. There's people who put all their money in stocks or all their money in bonds. know, look, I'm not here to tell anyone to do that. But you know, most people, if you look at most of your listeners out there, You know, the average portfolio for most people is 60 % equities, 40 % bonds. And I'm here to tell you, the 60 % is great. It's the 40 % that's broken. Okay, and look, since the pandemic, long-term bonds are down 40%. Does that sound like the largest, most liquid, most safe investment in the world to you?

Anthony Marino [10:07]: Let's stop there real quick because this is perfect. This is perfect. Most of us, most of America has a pretty clear understanding of the stock market. They hear every day, it's up, it's down, whatever. But the bond market...

Jim Lynch [10:09]: Go ahead. Right.

Anthony Marino [10:24]: is to me like looking through a fish tank. can kind of see the other side, but you don't really understand what's going on. Explain what has just gone on with the bond market when you say the bond market went down and why you think going forward it's not going to be the best possible use of your excess capital.

Jim Lynch [10:45]: Great question, Anthony. We did cover a little bit of this with the bond market in part one of our discussion. So I don't want to repeat everything we said there. I mean, in our last discussion, very apropos, was at the end of February. I think the first 45 minutes was predominantly the bonds and why they go up and down. But what's the issue? The issue is this. From 1900 to 1980, We had a bond bear market. For 80 years, you lost money in bonds. What do I mean by losing money? That's just that, you lost money. You didn't make money in bonds. From 19, go ahead. Yeah.

Dr. John Oberg [11:14]: Thank So, Holland Jim, so you're a bond trader 40 years. You made money selling and buying bonds. You're saying if I bought bonds and just held them the whole time I lost money, but you could actually make money in bonds. I you made money in bonds for 40 years.

Jim Lynch [11:34]: You lost money from the. Traders, traders will always make money, OK? It's not the traders I'm talking about. I'm talking about the individual investor. Go back and look, go back and look at the charts. Nineteen hundred to nineteen eighty was a bond bear market from nineteen eighty tonight to two thousand and twenty two was a bond bull market. You made money in bonds.

Dr. John Oberg [11:48]: Got it.

Jim Lynch [12:03]: Now, do I mean every year over those 80 years? No, but from those 80 years, if you look at 1900 to 1980, you lost money. From 1980 to 2022, you made money. Well, what happened in 22? Well, the Fed started raising interest rates and you basically had been losing money in bonds since. So that's the issue with bonds. Now I know And Anthony brings up a great point because you'll turn on CNBC or Bloomberg or Fox Business or CNN and you'll watch them for an hour and you're going to get 58 minutes of equity news and two minutes of bond news. And it's very confusing. But yet the bond market is basically driving the bus here. And that's what most people don't realize. They think they just buy a Treasury bond or a muni bond or a corporate bond and everything's hunky dory. No, we have a debt issue in this country. We have a debt issue in the West. Even China has a major debt issue and we cannot kick the can down the road anymore. We are at that precipice now where is it going to happen tomorrow? Is it going to happen three months from now? I don't know.

Anthony Marino [13:17]: for that.

Jim Lynch [13:25]: But we can't kick the market. We can't kick the can down the road anymore because we are in a situation that is known as fiscal dominance. What's fiscal dominance? Fiscal dominance is when your fiscal situation drives the bus. And that's what's happening in the market. Six times over the last six years, the Treasury market has blown up and six times the government has come in to add liquidity. Full stop. is not this is what I think they're going to do. This is what I thought they did. This is basic math. The Fed has a mandate. Low and low inflation, high employment. Well, that's that's out the window now. If that Treasury markets not functioning with 40 trillion in debt by the end of the first quarter, they got to do something. You want proof. Go ahead.

Dr. John Oberg [14:20]: Okay, so hold on. So the normal person though, this looks like, I'm insulated from this maybe in terms of feeling the impact. I think what this means is this stuff's happening. So what's happening is it looks like in some ways GDP growth is what's being reported to me, which sounds good. But really what's also happening is this kind of inflationary curve that's happening because more money is being printed, which

Jim Lynch [14:27]: Mm-hmm. Hmm? Yeah?

Dr. John Oberg [14:48]: seems great to me because maybe I'm getting a pay raise or what these other things may be, right? Or I'm charging more in the marketplace. But what might be happening that people don't recognize is that that inflationary period is actually creating less purchasing power for me. eventually, I trade my expertise for money in the marketplace. That's how I make money. And over time, that purchasing power either goes up or down. So while it might feel good to make more money, the truth is that it may have cost Anthony I Anthony, you probably bought your first house for 30 or $60,000. I bought my first house for $200,000 and my kids will buy their first house for $600,000. And the real issue isn't the number of dollars. The real issue is how much of my earnings potential, what percentage of my earnings potential am I paying for that house? And that has to be normalized against inflation, right? Like that's the part of the equation that we're being kind of lulled to sleep by, right? Or am I wrong?

Jim Lynch [15:44]: No, you're 100 % right, John, and this is what most people don't understand. So you're essentially talking about what Jamie Dimon called two months ago, the debasement trade. What is the debasement trade? Okay. Well, let's just talk since the pandemic. It's been almost six years. In US dollar terms, the NASDAQ is up 165%. So far, so good. I'm feeling great. The S &P is up 102%. Home prices are up 55%. Everyone's happy, right? You should be happier in a pig in mud. Well, but when you look at it in gold terms, the NASDAQ is up 7%, the S &P is down 18%, and home prices are down 37%.

Dr. John Oberg [16:37]: So hold on, so for me what that means is that like my real rate of return, so like the return minus inflation's impact, right? So we're not taking the return that's reported versus the reported inflation, because reported inflation is debatable. And we could argue both sides of that, but we're really talking about his buying power, right?

Jim Lynch [16:44]: Hmm. Right. Right. Yep. Buying power, purchasing power. So now let's.

Anthony Marino [17:00]: What does

Dr. John Oberg [17:00]: purchasing power. Okay, there you go.

Anthony Marino [17:01]: it mean in gold terms? Explain that.

Jim Lynch [17:04]: In other words, I priced, let me finish and you'll see it. So now let's go to Bitcoin. Now know Bitcoin is backed up a little bit. This chart is from a couple of months ago. So it's not as good, but in Bitcoin terms, the NASDAQ is down 78%. The S &P down 84 and home price is down 87. That's probably a little bit better now, but let's talk real dollars. So in the spring of 20, I moved to Austin here in the spring of 19. I'm a road biker. met a couple of guys I'm friendly with and we were we were bike riding together. Two of the guys are real estate attorneys here in Austin. The other guy is an oil and gas and we're out riding in the spring of 20. Think about what we were going through in the spring of 2020. And my my buddy in the oil and gas business said, hey, I'm thinking about buying a house. Here's a guy my age. He's divorced, was going to was going to buy a house. He could have bought a house. I don't know where I don't know anything about the house, but it was $300,000. And obviously the two real estate attorneys told him to do it. I told him not to do it. Now, obviously that was a bad call on my part. Okay, so that $300,000 house today is worth just under $500,000. Okay, so I need. We're going to round it up to $500,000. I've got to come up with a half a million dollars to buy that house today. Let's go back to the spring of 20. Where was Bitcoin trading at? It was around $10,000. But I know you put a bid in for that house and I know attorneys. Let's say it's now the fall. Bitcoin is now $20,000. How many Bitcoins do I need to buy that house? in the fall of 2020. Well, it turns out I need $20,000 for a $300,000 house. need 15. I need a half a million to buy that house today, or I need just under five bitcoins to buy that house today. 15, 15, let me finish, 15 five years ago, less than five today.

Dr. John Oberg [19:17]: So, yeah.

Jim Lynch [19:24]: Do you see the, can you see the devaluation of your money?

Dr. John Oberg [19:29]: And for the listener, think what I want to point out is like, this is my opinion now, my non-professional opinion is like using your own personal like abode where you're living is probably not the very best example because most people don't buy their house for financial reasons. Primarily there's lots of other emotional things that might go into that. But I think you could to Jim's point, think Jim, could, you can point out to a car, to a pizza, to like, like take any a dozen eggs, like, like take anything you want to buy, like take the emotion of your home out of it.

Jim Lynch [19:35]: Mm-hmm. Okay.

Dr. John Oberg [19:59]: and just get really honest about like any durable good that you purchase costs two thirds less in Bitcoin today than it did five years ago.

Jim Lynch [20:08]: Yeah, yes. So go ahead.

Randy Lorensen [20:13]: For me, one of the big breakthroughs in my understanding of this is when I realized prices aren't going up, that everything like, again, a house is still a house, a car is still a car, a rib eye is still a rib eye. Prices are not really going up as much as money is losing value as they print it and they flood the market.

Jim Lynch [20:35]: Yeah.

Randy Lorensen [20:38]: everything, your money loses value. That for me, that transition while small helped a lot with my understanding.

Jim Lynch [20:41]: Yeah.

Dr. John Oberg [20:46]: And losing value, I just want to clarify, losing value is tough for some people, like a dollar's a dollar. But so to me, what made it clear for me is losing purchasing power. Like that to me was like the light, the watershed moment for me.

Jim Lynch [20:51]: Yeah. Yeah, yeah, bingo, John. When I was on in February, I talked about the debasement of our dollar. it depends on who you listen to. Everybody's got different opinions, but it's somewhere between eight and 15 percent. Let's use eight. OK, it's easy. So in other words, your income, you're making one hundred thousand dollars this year. What does this mean? A year from now, that one hundred thousand only buys ninety two thousand dollars worth of goods. That's the issue. So back to Anthony's very first question. How do you overcome this? Well, you need hard assets. What are hard assets? Well, equities are hard assets. Real estate's a hard asset. Art is a hard asset. Gold is a hard asset. Bitcoin's a hard asset. Diamonds, ammunition. I think all these things will continue to do well. going forward. a matter of fact, I, 40 years in a bond business, I would advise anyone not to buy long-term bonds here. Okay? Not investment advice. But Jim, Trump is going to lower the interest rates. He is. Think about our debt. For one second here, 23, the market was up 20%. 24, the market's up 20%. As you and I are recording right now, live up to the minute, the NASDAQ is up 20, almost just under 22%, and the S &P is up over 16%. We're gonna have three years in a row of record returns in the stock market. Historically, it's between eight and 10. Our gross receipts for the third year in a row will be over $5 trillion. Now keep in mind, We also have tariff income if the Supreme Court lets that stay. So let's assume that they do and let's assume we get the tariff income. We're still running a $2 trillion deficit. Okay, they got to cut something. They got to cut something. Okay, let's look at it. Can they cut Social Security? Not for the next 10 or 15 years. Why? You got 76 million baby boomers. You have millions of silent generation. They're not voting themselves out of a check. Good luck with that one. Medicare not losing it for at least 10 or 15 years. Veterans benefits. Good luck cutting their benefits. We just increased the defense budget this year. What else is there to cut? Lunch for the White House? Come on. The only other thing they can cut, it's basic math. The only thing they can cut is interest rates. Why is Trump killing Powell in the media? Why are they doing this? Because the only thing they can cut is rates. So what do they need to do? They've got to get interest rates lower. They have to. But, inflation is running hotter. Yeah, guys, we're 40 trillion in debt. Read your history books. Every nation that's gone through this, you have five options. What are these five options? All right, glad you asked. You can default. Not happening. Okay, anybody who can print their currency, they don't default, they print the money defaults out the window. We can do austerity. Great. Go back and listen to the first video and see what I said about Doge. Yeah, do I think?

Dr. John Oberg [24:32]: Hold on, back up, austerity, what's that for people who don't know what austerity is?

Jim Lynch [24:37]: You cut back. You spend less. Yes, now you go ahead. Cut our debt. Cut our spending by two trillion dollars. See what happens to GDP. You'll be in a 1929 recession in the blink of an eye. So you can't do austerity. All right. OK, you can. How about a production miracle? I know we're going to talk about AI here, but yes, if we could have.

Dr. John Oberg [24:39]: So you only, you only, yeah, you spend only what you bring in.

Jim Lynch [25:04]: productivity miracle. Go back to the 1800s. The British Empire had the same issue in the 1800s. We got the Industrial Revolution. It bailed them out. Can nuclear fusion come aboard? Yes, maybe it works. Maybe AI works. We'll talk about AI in a minute. I don't think so. Okay, what do most countries do when they're in this situation? They go to war. Okay, let's go to war. We're seeing the results in the Ukraine. Russia has defeated NATO. Look at the bottom line. Do the math. Now, let's go to the end of June. When was the last time you saw a United States president have a WTF moment on national TV? Just go back and watch the tape. Look it up on YouTube. At the end of June, remember the scuffle we had with Iran, we bombed Iran, Israel was bombing Iran, and then Trump negotiated this peace agreement. And then he's doing an interview on the White House grounds, and Israel continued the bombing, and Trump said, they don't know what the, you know what they're doing. Never in my lifetime have I seen a president, no less a public figure, say that live on TV and made the headlines. What was Trump so upset about? He was upset. He negotiated this deal. But really what he was upset about? The Department of Defense told Trump, look, we can no longer send any more ground to air missiles to Israel. We're running low. can't send any more. Well, we'll just make more. No, we can't because why? China's not sending us the rare earth materials. OK, so now let's go to Israel.

Dr. John Oberg [26:28]: Thanks

Jim Lynch [26:54]: Israel had less than two weeks supply of these ground-to-air missiles. Less than two weeks. Well, how many missiles did Iran have? Five months supply. Look, any second-grade kid can do this math. Five months supply, two-week defense system. Who's going to win? It's not that hard to see this. And that's why Trump was so upset. So when you look at our debt and you look at reshoring and you look at AI, The math is just not working. You know, our button, go ahead. Go ahead.

Dr. John Oberg [27:27]: Hold on. Timeout. Timeout. We go back and look at coming out of World War II, massive periods of growth. We've got the 60s that you mentioned, the 70s, the 80s. have these interest rates in the 80s were ridiculous. They get into the 20s, think, something like that. Again, not a historian, but over the last 400 years, the Bank of England or Bank of London, one of those banks, average interest rate at 5%.

Jim Lynch [27:39]: Yeah. yeah. Yeah.

Anthony Marino [27:45]: Also.

Jim Lynch [27:53]: Thank you, England.

Dr. John Oberg [27:56]: Right now we're at historically pretty normal interest rates. You're saying we got to cut interest rates so that we can cut the payments, right? By the way, I just want to give you credit. You came on early in the year and said Doge wasn't going to work because we couldn't do it. And it turned out to be correct. Like just want to call that out. You're going to say you didn't set some things wrong. I'm going to say you said some things right too. Like you got it there. like I can.

Jim Lynch [28:02]: Yeah. Thank you.

Dr. John Oberg [28:22]: kind of like not at knowing all. Like they say ignorance is bliss. I kind of like just, you know, feeling good about things and spending money on Christmas and like, but I also want to protect my family. Is there, is there a middle ground here?

Jim Lynch [28:34]: John, look, Bond people are historically pessimistic, okay?

Dr. John Oberg [28:42]: Is that why you became a bond person?

Jim Lynch [28:44]: Yeah, I don't know, because I really think we're going to come out of this much better, but we're going to go through hell first. The United States is a...

Dr. John Oberg [28:55]: What does hell look like? When you say go through hell, because we've been talking on this show a little about the fourth turning, we've talked about Dalio's book where it goes through the cycles. This is a cycle that's repeated itself for hundreds and hundreds of years. They call it the fourth turning in the book. They don't call it hell, but it's hard. When I was growing up, they said that good times make for soft people, make for hard times, make for...

Jim Lynch [29:02]: Yes. Yeah. Yeah. Yeah. Yes, the fourth turn, yeah.

Dr. John Oberg [29:25]: good times, hard people's good times.

Jim Lynch [29:28]: It all makes sense, John. It all makes sense.

Dr. John Oberg [29:31]: So what am I preparing my family for for the next 10, 15 years?

Jim Lynch [29:35]: Okay. Well, first of all, I believe we're in the beginning stages for the first time in over 100 years where the reserve currency of the world is coming into question. You're seeing this in the BRICS, you're seeing this in Russia, you're seeing it in India, you're seeing it in China. What I would encourage everyone to do, please don't take it. If you don't want to believe me, that's fine. Just go read your history. Read Ray Dalio's book. Read The Fourth Turning. Read about the Weimar Republic. Read about Venezuela. Read about Argentina. You know, it's funny, in the last few weeks, I've been to lunch with a guy from India. He's a good friend of mine. And also, believe it or not, I met a guy from Zimbabwe, of all places. I'll bring him on next time. He'll tell you what's going on, where you have trillions of dollars of your banknote basically worthless. Now, do I think the United States is going to go through that type of situation? No. But guys, look, Americans, we have a choice. You can either save the bond market or you can save your country. You can't do both anymore. You're going to have to kill one of them. I believe we're going to kill the bond market. OK, you have to kill the bond market. Now, don't leave this podcast and say. Treasuries are going to default. No, they're not defaulting. You're going to get every principal payment, every interest payment you're entitled to. However, it's going to be worth far less than when you invested in the bond.

Dr. John Oberg [31:17]: So that's because again, that's because the government's printing the money.

Jim Lynch [31:21]: Printing the money every time they print a dollar the devaluing your dollar. You own Apple stock. What happens if Apple comes out today and issues more stock? It dilutes your stock. That's essentially what the government is doing with our money. They keep printing more money. It's not tied to anything, right? They just created at a mid-air. Well, that devalues your current money that you have in your pocket. It's really basic math.

Anthony Marino [31:21]: So. Thank I need to ask a basic question. Hypothetically, if every single country with a legitimate fiat currency increases their money supply proportionate to everyone else, does that change the dynamics of... Okay.

Jim Lynch [31:52]: Go ahead. Mm-hmm. No, no. As a matter of fact, they are. I mean, I look at global liquidity because that's really what drives assets, right? Why is your home up so much? Why is the stock market up so much? Why is gold up so much? Well, China is leading the world in money printing this year. Okay, they're doing more than everyone else. I don't know, maybe in 26, it'll be another nation.

Anthony Marino [32:19]: no, I know. That's why I'm asking.

Jim Lynch [32:44]: But look, if we didn't print the money, if we weren't making all this money, you wouldn't be as wealthy as you think you are. Look, to be a millionaire, in 1980, if you had a million dollars, today you need four million dollars to be in the same situation. All right? So look, our debt situation is horrendous. I really want to go ahead.

Randy Lorensen [33:12]: Jim, before you go on, John, I think to your point, what does hell look like? I don't know that we know, right? Jim doesn't think that it's Zimbabwe, but some of the things like more repose on cars are, think at an all time high or they're approaching an all time high, know, mortgage foreclosures are getting up there close to where they were in like 08, 09.

Jim Lynch [33:20]: We, yeah. Mm-hmm.

Dr. John Oberg [33:37]: Thanks for watching.

Randy Lorensen [33:38]: And all of the bankruptcies are way up. There's people, what did we talk about the other day? Like 25 or 30 % of grocery purchases are now being financed. Like these are, this is a little bit of...

Dr. John Oberg [33:51]: No, Whoa,

Randy Lorensen [34:00]: Yeah. Right. Okay. All right. Good. Good correction. Good correction. So I think

Jim Lynch [34:04]: Mm-hmm.

Randy Lorensen [34:07]: these are all symptoms of what Jim's talking about. These are all what happens when the money printing happens. And the Cantillion effect is whether it's the US printing or China printing or whoever, they print it. The politicians benefit, the lobbyists benefit, the big corporations, all the people closest to that money supply. They get the money early. You know who doesn't get it? The waiter, the waitress, the bartender, the factory worker, the truck driver. That's why we have this K-shaped economy, right? So I...

Dr. John Oberg [34:40]: Okay, hold on. I know what some of these things mean, but you used Cantillion effects, so first of all, explain what that means.

Jim Lynch [34:45]: All right, Richard Cantillon was a Fed governor back 100 years ago. Oh, I'm sorry, I got the Triffin dilemma here. Sorry, I'm mixing them up. Cantillon, okay, so what he said and he showed in his writings that when the government prints the money, who gets it first? Those closest to the money printer get it first. And by time it gets down to Larry Lunchbucket, so to speak, the prices of everything have been inflated already. So the average guy pays the higher price without having the benefit of getting the money like when everyone else did. That's really...

Dr. John Oberg [35:27]: So this is classic, classic rich get richer, poor get poorer. That's, mean, this is what we're talking about.

Jim Lynch [35:33]: If you want to know why there's an equity gap in this country, this is the reason why. All that printed money went to the very wealthy first. And what did they do with it? Well, they bought businesses, they invested it. And that's why the stock market's up as high it is. Should the stock market be up this high? Absolutely not. Will the stock market keep going up? Absolutely. Okay, so I know that's an oxymoron sentence, but look, that's just what's going to happen here. You know, if you look at it, I just told you our budget and we just went over the budget. Can you imagine if the S &P went down 5 %? What that would do to our budget? It would blow it out.

Dr. John Oberg [36:17]: So people that say things like, we should just kind of take our medicine and let things go down. That's one way of handling it. A different mechanism is, is inflate the money supply. have the same, you have the same purchasing power reality as if you let it go down, but it doesn't feel as bad, which can be, I guess, politically it's at least under, I don't agree with it, but at least it's understandable why somebody would choose that route, right? Because they're not going to, they're not going to like,

Jim Lynch [36:32]: Mm-hmm.

Dr. John Oberg [36:46]: alienate their voting base. I understand the incentive even if I don't agree with it.

Jim Lynch [36:51]: Yeah, yeah, first of all, the politicians aren't going to do it, but let's assume they did. All right. I don't have that. This is going to be ballpark numbers. You would have to cut our spending by at least a third, at least a third. So instead of spending seven trillion dollars a year, you're going to be spending under five trillion. OK, what do you think that's going to do to our GDP? It's going to blow it up. What do you think that does to our treasury market? You're going to have failed auctions. It'll blow up our debt. There's absolutely no way we can do that. The math doesn't work. You're going to tell all the boomers and all the silent generation, your Social Security, your Medicare benefits, the VA benefits. You're going to cut them by a third. Good luck with that. Try getting that through Congress. Look, I tell every person this. If you're over 80 years old, you're good. You're going to get all your social security. You're going to get all your med care. Why? Because we got the votes. 10 years from now, 15 years from now, when the youngest baby boomers approach in 80 and a lot of these people have passed away. Well, then then the millennials in Generation Z will have their say. So if you're a young boomer, I would not think that you're going to get social security and Medicare benefits for you for the rest of your life. I just don't see it. The math doesn't work. So if the math doesn't work, regardless of what your biases are, regardless of what you think, the plus two has to equal four and it doesn't. And that's the problem. Our debt is the issue. That is the underlying problem here. And look, there's red flag after red flag after red flag. And I can spend the next hour going over this, but you know, know we're getting a little short on time, but look. There are so many red flags in our treasury market, in our bond markets.

Dr. John Oberg [38:53]: Yeah. Okay, so I'm trying to take it down to my level real quick. what I'm hearing, like, buy hard assets, check, I heard that message, right? I think what I just heard, think, please, firmly correct me if I'm wrong, buy hard assets with leverage if you can, because if you can borrow money with today's cash, right, and then pay it back with tomorrow's inflated cash, you end up paying less for that hard asset. Is that true?

Jim Lynch [39:02]: Yeah. It's true. I would not do it though. Why? John, I personally believe these next six months could be really, really dicey.

Dr. John Oberg [39:24]: Okay, why? So debt's bad in that case. Okay.

Jim Lynch [39:34]: Yeah, yeah, I would not. would not. I mean, just look what's happened to Bitcoiners who leverage their Bitcoin. They got taken out. Look, right now is not the time to be levered, levered. You you want to be unlevered. You want cash on the sidelines. Look, if we go back to April, we had a 20, 25 percent drawdown in the stock market. Great time to buy. You're up 40 percent since those lows. Okay, you want to be able to buy there. I don't believe the stock market can stay down for a long time. Could it go down 20 %? Absolutely. But the Fed, the Treasury, cannot let the market have a 22 again because it'll kill their receipts. You got your capital gains receipts, which was 500 billion in 22. You got your RMD receipts, required minimum distributions that all the retirees got to take out. That was a lot lower.

Dr. John Oberg [40:06]: Done it.

Jim Lynch [40:33]: That would cost the government $500-600 billion. And at a $2 trillion deficit, what do need to do? You've got to issue more bonds. No one's buying our bonds. Look.

Dr. John Oberg [40:40]: Hmm. So is it an okay time to buy a house then? I I don't buy Bitcoin levered.

Jim Lynch [40:46]: No, no, no, no. Look, people ask me all the time, should I buy a house? If you're 35 years old, you got a wife, you got a couple of kids, I got it. I understand. I did it. You guys probably did it. Am I buying real estate just to buy it? Look, they're going to fix real estate with the lowering of interest rates. So that to me is going to get fixed.

Anthony Marino [40:57]: you you

Jim Lynch [41:13]: You bring those rates down, you bring that 10 year down to 2%. You watch what happens to the real estate market. You want growth in this country? You you bring that 10 year down 2%. Speaking of the 10 year, remember what Trump and Besson said on January 20th. Judge me by the 10 year. My on January 20th was around four and a quarter. It's 417 right now. Do you think that's an A plus grade? I don't.

Dr. John Oberg [41:45]: I don't know what it would be. A plus be 2 % or 10 %? Like, up or down? Like, what would be good?

Jim Lynch [41:49]: Well, look, I think Besson was looking at three and a half, three. We're not even close. So if I had agreed, OK, remember what he said? These were his exact words on the 20th. Judge me on the 10 year, four and a quarter on January 20th, 417 on December 8th. It's not working for me, guys. It doesn't matter if I voted for him, if I like him, if I think he's the greatest.

Dr. John Oberg [41:53]: Okay.

Jim Lynch [42:18]: Treasury Secretary in the world. The math doesn't work. It's just basic math. It just comes down to math for me. How did he do? Eight basis points in 11 months, 10 months, whatever it is. I don't think he's gotten rates down to what he thought he was gonna do. Now, going into 26, they're coming down. If you're a trader, I'm not. If you're a trader, so some financial people asked me a few weeks ago. Jim, if you're right and the treasury goes from 417 on a 10 year to two on the 10 year, don't you think that's worth a trade in bonds? Go ahead. Go do it. It's like picking up a nickel in front of a steamroller. But let me ask you this. If the 10 year treasury at 417 goes to two, that means liquidity is in the market, okay? Expanding liquidity. What happens to the equity market? What happens to gold? What happens to housing? What happens to Bitcoin? What happens to art?

Randy Lorensen [43:22]: For people listening only, he's pointing up with each one of these.

Jim Lynch [43:26]: These assets will go through the roof.

Dr. John Oberg [43:30]: So, but you just told me not to buy a house. Now I'm confused.

Jim Lynch [43:34]: Yeah, look, I don't think real estate is. Look. For the last 40 years, when you have a bond bull market, you're going to make a lot of money in real estate. When it's a bear market, you don't make as much money. Even if the two, even if the 10 year goes to 2 percent, what is this going to cause inflation? Inflation could be 4 percent, 5 percent, 10 percent. The government doesn't care. They got to devalue the debt. John, you talked about the 40s before. What's the difference? Here's the difference. We're 120 % debt to GDP. We're running a 7 % budget deficit. And we have a net international investment position of a negative 80%.

Dr. John Oberg [44:20]: Yeah, I don't know what it means. think what that means is I got to pay more in interest payments that I can't spend on improving the infrastructure. Is that what I'm hearing?

Jim Lynch [44:27]: OK, OK, OK. The big confusing part there is a net international investment position. Negative 80 percent. What does that mean? John, you're an individual. You and your wife were at the end of the year here. And you had a major health scare during the year and it cost you an extra fifty thousand dollars. And you say and you and your wife sit at the table there and you say, OK, hon, what do we what are our options here? Our options are we can pay it back on the installment plan. We can borrow money and pay it back. Or we can tap our 401k. We can tap our home equity loan to pay it off. You have the money. That's a positive net international investment position. The United States has a negative. Japan has a positive 60 % international investment position. They got a problem with money, they'll just sell some assets. I'll cover it. The United States doesn't have that. In the 1940s, our debt to GDP was 30%. In the 1980s, it was 30%. It's 120 and going higher. The math just doesn't work.

Dr. John Oberg [45:42]: Okay, so real estate's gonna go up, gold's gonna go up, Bitcoin you think is gonna go up, but of all those things, I think I heard you say diversified portfolio, equities are good, careful of bonds is I think what I heard, and then cash on the sidelines so you can buy when there's buying opportunities.

Jim Lynch [45:45]: Yeah. Yeah, Yeah, I would take any long-term bond and convert that into short-term bonds. Nothing out more than three, five, 10 years. Wouldn't have anything there. Look, the government's telling you you're losing money. Think about this for a second. The government's issuing debt, and how many rare earth deals have they made over the last couple of months? They're buying rare earth, Australia, a big deal there. They're buying property in Nevada. They are doing every rare earth deal under the sun. So they're issuing debt to do this. And we're buying that debt? You see the oxymoron there? They're buying metals. We're buying their debt. It doesn't work. Do what they're doing. Do what central banks have done for the last 12 years. I mean, it's not rocket science. Follow the money.

Dr. John Oberg [46:51]: So kind of follow the money, right? Like my kids are, my kids are joking. They're like, dad, we want to invest in those ETF funds that follow what the senators and the house representatives do because they know what we don't know. I was like, that's really smart. And I'm glad that you figured that out at a young age.

Jim Lynch [47:06]: Yeah, I mean, there's an ETF with the Nancy Pelosi fund. I know she's stepping down, so maybe we won't know anymore. But yeah, you can do it. Look, look.

Dr. John Oberg [47:15]: Yeah.

Randy Lorensen [47:16]: Jim, Jim, can we go back for a point of clarification? You were talking about the interest rates earlier, right? And it went from four and a quarter to 4.17. But the rate, the Fed rate cuts this year, I think what most people hear, right? If rates are at four and a quarter and they drop a quarter point, the 10 years should go down a quarter. I think that's what people assume, but that's not what's happened. Three or four interest rate decreases this year, right? Three?

Jim Lynch [47:22]: Yeah. Yeah. Yeah, that's not what's happening. Well, let's go back to last year, Last year, the Fed cut 75 basis points in September and October. The 10-year yield went up. What? OK, so they're doing the same thing now. OK, they're doing it again. It's like they didn't learn their lesson from last year. So they're cutting rates. Again, why are they cutting rates? I think Powell's doing it reluctantly. Whoever the new Fed share Whoever the new Fed chair is coming in, they're going to do it very aggressively. And, you know, why are they doing it? It's the only budget item that makes sense to cut. They're in a corner. They are stuck.

Randy Lorensen [48:24]: So what I want you to address for listeners is they're cutting rates, but we don't watch the 10 year and the 30 year going down. Mortgage rates aren't going, even though they've cut last year, 75 points, this year, 75 points, you would think mortgages would be down one and a half percent, but they're not.

Jim Lynch [48:44]: Well, they would be down from seven, right? They would be like five and a half or something. Yes, that's logic.

Randy Lorensen [48:48]: Right. explain that market dynamic. Why is that not happening? What is happening instead?

Jim Lynch [48:56]: OK. OK, so your mortgage rates, like most things in the world, are tied to the risk free rate. What's the risk free rate? The 10 year Treasury. OK, see, the Fed controls the short end of the market, the one two year market when they lower the discount rate or the overnight rates, they are affecting T bills and even a two year bond. They don't control the 10 year rate. That the market decides. And the mere fact that for two straight years, the Fed has cut 75, assuming they cut 25 this week, which all consensus believes they will, that's two straight years, 75 % rate cuts, 75 basis point rate cuts, and the 10 year is not going down. Why? I mean, even if you don't understand it, even if it doesn't make sense to you. You must come to the conclusion that something's not right. Something's not working. And what's not working is the debt markets. Again, we're in fiscal dominance. This is when the debt drives you. You don't drive the debt. Those days are over. We've passed that Rubicon, so to speak.

Randy Lorensen [50:17]: So that's maybe, maybe to sum it up, that means Japan, China, investors, et cetera, are not buying as many. There are not as many bids or people wanting to buy our debt and we're having a harder and harder time unloading it. Is that a good way to sum it up?

Jim Lynch [50:35]: You can see it in every instance. Jack Lew was President Obama's Treasury Secretary in 2014. He was rolling on a weekly basis 100 billion in T bills. In other words, they were issuing 100 billion in T bills every week because they had to pay off the old ones and issue more debt to pay their bills. Right now.

Dr. John Oberg [50:52]: What does that mean? Got it.

Jim Lynch [51:05]: Besset is issuing 550 billion in T-bills on a weekly basis. This is unheard of. This is ridiculous. 550 billion. It's a five-fold increase. Why? Because they can't issue 10-year and 30-year bonds. They can't. No one's buying them. Central banks, for the last 12 years, have stopped buying our debt. They're buying gold. Okay? If you think you're smarter than the central banks, so be it. God bless you. Okay. So who's buying our debt? Well, in 2014, the Fed mandated through the money market funds, if you remember that fiasco from the great financial crisis, they would only back government bond money markets. Okay. They relaxed the SLR agreements. That's the Supplements Leverage Ratio for banks. So they could buy more bonds and they just did it again. Okay, they're doing treasury buybacks. I covered that in the first part. Go back and listen to what our treasury buybacks. Why do you need to do it? Johnny Allen started this in 23. Besson picked it up. He doubled it this past spring. Why are we doing treasury buybacks? If it's the largest most liquid market in the world. Look, there's a problem guys. You don't have to understand the problem. You just have to know there is a problem. And I showed you through the...

Dr. John Oberg [52:35]: But I think that's the key. So there's a problem. I don't fully understand the problem, but I know enough to know that bonds carry a different type of risk. So short-term bonds, if I want bonds, that's what I'm hearing. Equities, hard assets, that's a thing to think about for the future. And then be sensitive to purchasing power that you may be making more and more and money. Inflation is being reported by different groups.

Jim Lynch [52:46]: Mmm. Mhm. Yeah.

Dr. John Oberg [53:04]: that is an arguable number that people have different incentives for telling you different things. All that really matters is what you're purchasing with your money.

Jim Lynch [53:07]: Yep. Absolutely, John. Look, everybody's got a story. You go to your local HEB and the things that you buy on a weekly, monthly basis are all up in price. Your rent is going up. Even though Austin has got a lot of empty buildings, your rent is going up. Your taxes are going up. mean, it's not going up 2%. It's going up 3%, 4%, 5%, 10%. Take your pick, eggs.

Dr. John Oberg [53:27]: Yes.

Jim Lynch [53:42]: Try getting a we we mentioned rib eyes at the beginning of the show get a decent read by and tell me how much higher that is And what it was just a few years ago, you know, so look, you know, these things are key things John You brought up a good point here and let's let's let's start to wind up

Dr. John Oberg [53:59]: was real quick in the restaurant, I got a mocktail. I looked at the mocktail, so the non-alcoholic drinks, $16 for a non-alcoholic drink. had a restaurant the other day, I was like, yeah, I'm gonna have some water.

Jim Lynch [54:03]: yeah. I mean really it's insane. All right. So guys we're going forward. We're gonna go into 26 have me back in three six months See if I'm right or wrong, whatever. Here's some things. I think I believe will happen. You're gonna get a new Fed chair. That's a given he's gonna be He's good he's gonna be dovish on rates rates are gonna come down I believe they're gonna get the 10-year down. Okay, there's other things that they can do

Dr. John Oberg [54:28]: What does that mean for me?

Jim Lynch [54:41]: And I think there's some things that'll happen. Here's something else that's going to happen. By the end of the first quarter, Trump better have everything he wants to get done done. What are we going to start talking about on April 1st? Midterms. And that's going to drive the bus for next year towards the end of next year. And if he loses the House or Senate, he's a two year sitting duck president. All right. Next July.

Anthony Marino [55:07]: Yep.

Jim Lynch [55:11]: 250th year. Just think about who's the president. Think about what he wants to do. Read Judy Shelton's book. She believes they're going to do some type of gold back treasury bond. I don't know, but it's interesting. So indices that I like to follow. These are some things you guys can follow that are very, very important. The Treasury move index. Go on CHAP GBT, put it in there, Treasury Move Index, and it'll show you. don't know what, I use Bloomberg, so I get it on there, but you can track this. And this is the volatility index. So the guy who invented it just recently passed away, but think of 100 being par. When it goes over 100, that means liquidity is drying up. Okay, that means the dollar's gonna get stronger, the market's gonna go down. and the treasury market's gonna basically malfunction. When it goes lower, there's ample liquidity. That's a great thing to follow. The spread between corporate bonds and treasury bonds. It's very tight right now. When that moves out, that's usually a sign that money's getting tight. I would watch oil. Oil is a key commodity. Right now it's trading around $60 a barrel. It's too low. Shale is rolling over. What do I mean by rolling over? You know, they shut down those rigs. If they can't make money with Shale, we're going to cede the oil markets to Russia and Saudi Arabia. I don't believe it's going to happen. So watch oil. Look, I think going where I want to be with assets. Look, I think gold is a very interesting play here. Hundreds of billions of dollars of gold have come into this country over the last year. Where is it going? Who has it? You know, as all financial firms have to report every quarter, we call them 13 F filings, 13 F like Frank. It's a mandatory filing that everyone has to file, every financial firm. Okay, so you have to report your buys and sells every quarter. No one's reported buying of any gold in any large quantity. Okay, well, common sense says to me that I think I know where that gold is going. And I believe at some point in time, they're gonna have to revalue gold. So I think gold, look, I think Bitcoin. Gonna be a little rocky here, could be a little rocky. I think we could get some kind of down draft here even in the stock market, but that's to me a buying opportunity. The market goes down 20%, use your cash, use your short term bonds, add into that scenario. The Fed needs a higher stock market. That's it. There's nothing else to discuss. Whether I'm right or wrong is irrelevant. The treasury needs a higher equity market. They got to pay the bills. We can't pay them now. Just think, just do the math on that. Five trillion in receipts, seven trillion dollars in spending. What happens if the stock market goes up 2 % a year? Where are we going? It's horrendous, it really is. And we're spending trillions of dollars on AI. I read the other day, over the next three years, AI needs three trillion dollars to keep losing money.

Anthony Marino [58:35]: Hmm

Jim Lynch [59:02]: Think about that for a second. So there's a lot of things that we're watching. But look, I believe it's hard assets. Look, my two largest positions are Bitcoin and gold. That's where I think it's going to be, equities. think there's going to be pockets of equities. I think we'll do a lot better than others. I think we have a problem with the grid in this country. We don't have enough grid for this AI. You look at all these data centers, they don't have the grid. NVIDIA, you might have heard of NVIDIA. It's our largest company in America. And Santa Clara, California. The two data centers that NVIDIA is relying on for power are sitting dark. There's no grid. Think about that. Think about that. Do you think they're going to have to expand our grid over the next three, five, 10 years? If you don't, then don't do it. But the math says to me that we need more power generated. I don't know if it's nuclear, I don't know if it's wind, I don't know if it's solar, I don't know drilling out in the ocean. Look, I don't know that, but I know we need more grid. So these are things I would be looking to do as we go into 26 and key things that are gonna say to me, hey, and by all means, there's some people I follow. If liquidity is expanding, the market's going up. And I really believe right now what we're looking at in this country as we sit here today, I think we're looking at the mother of all crisis. Because right now, we need the Fed to start printing money. If we don't, because we are seeing many red flags, whether it be the TGA, the repo, the reverse repo. I mean, we can get into all this. But right now, I'm looking at this before printing, during printing, and after printing. And I think this is all to hit the fan in the next two to six months. By next summer, we're going to have a good idea. Because there's no way Trump is going into the midterms without shooting some guns. It's just basic math. No president does. So be prepared.

Dr. John Oberg [1:01:29]: It's going to be interesting. We'll have to come back and take a look in a few months how it all turned out based on some of the things you said. That'll be very interesting.

Anthony Marino [1:01:29]: Gotcha.

Jim Lynch [1:01:38]: I think so, John. I'll be interested myself. Look, think some of the things we talked about in our prior episode worked out. I didn't get everything right. But I'm not going to be right on everything. But I do know this.

Dr. John Oberg [1:01:52]: So definitely take the $20 bills out of your pillow and put them into something that's a hard asset. That's what I heard.

Jim Lynch [1:01:56]: Hahaha! Definitely, definitely.

Anthony Marino [1:01:59]: Jim, what do you think the growth rate will be over the next six months to a year in this country?

Jim Lynch [1:02:09]: It has to be higher than our interest rates. All right, because we have to inflate the money away. if the 10 year treasury is at two, the growth rate has to be higher. Has to be. It's just basic math. If the 10 year treasury is at four, you need a higher than 4 % growth rate. If it's under that, we got a problem. That's a great question, Anthony. If our growth is not above where interest rates are, you know.

Anthony Marino [1:02:13]: No.

Jim Lynch [1:02:41]: We got a major issue on our hands.

Anthony Marino [1:02:44]: I mean, that's the only thing that we can do to reduce, to slow the increase in the deficit and over, we would have to grow at 10 % a year for four years to cover the 5 billion to 7 billion. So, be tough. That's obviously unlikely, but yeah, it's going to be interesting to see what the next year brings.

Dr. John Oberg [1:03:11]: Well, let's keep this conversation alive. I think we come back in a few months, Jim, we'll bring you back on. We'll say, are the things we said we should do. If you did that, here's how it turns out. If you didn't do that, here's how it turns out. And definitely take your 20s from the pillowcase and get them into some kind of hard assets somewhere. I got 40 bucks going into gold later today. Yeah, that's great. All right, Randy, you want to take us home?

Jim Lynch [1:03:24]: Yeah

Anthony Marino [1:03:25]: Good idea.

Jim Lynch [1:03:29]: You can do that Costco, right?

Randy Lorensen [1:03:30]: And by the way, give give to give Jim his flowers, I was refer referring back to just an AI summary of his predictions from January, February, whenever that was. They're pretty spot on. They haven't all come true. But like one of them that hasn't come true, as he said, there's a good chance of a black swan event. And a he said, it's a good chance. B, I don't think we're necessarily out of the water. Like that could still happen. So if you go through the...

Jim Lynch [1:04:07]: yeah.

Dr. John Oberg [1:04:07]: Well, and C, predicting black swan events makes them not black swan events.

Jim Lynch [1:04:12]: That's true.

Randy Lorensen [1:04:13]: Yeah.

Jim Lynch [1:04:14]: I will say this on the black swan event. I believe with all my heart, it's coming out of the bond market somewhere somebody's over leveraged issue too much debt. So that's where I think it would come from.

Anthony Marino [1:04:27]: Well, great work, man. This is great.

Dr. John Oberg [1:04:31]: It's fun. Thanks, Jim.

Jim Lynch [1:04:31]: Alright guys, always a

Randy Lorensen [1:04:32]: All right.

Jim Lynch [1:04:34]: joy.

Randy Lorensen [1:04:34]: Yes. Thank you so much, Jim. Merry Christmas and listeners, as always, thank you for downloading.

Jim Lynch [1:04:42]: Have a good one. Happy Holidays!

Dr. John Oberg [1:04:42]: Thanks everyone.

Randy Lorensen [1:04:43]: Thanks, Jim.

Anthony Marino [1:04:44]: Same to you, Jim.