In this episode of Wealthion, James Connor speaks with Jim Rickards, a renowned economist and bestselling author, who dives into the political and economic turmoil shaping the upcoming 2024 elections. Rickards provides his insights on whether President Biden might be replaced before the Democratic National Convention and the implications for the economy and investor sentiment. He also covers the ongoing geopolitical tensions in the Middle East, Ukraine, and China. Rickards states, “Biden’s future as the nominee is uncertain.” This episode also explores: * The likelihood of Biden being replaced at the DNC. * The geopolitical landscape and its influence on US politics. * The state of the economy heading into the 2024 elections. * Strategies for investors to navigate the political and economic uncertainties. Tune in to hear Rickards’ expert analysis and prepare yourself for what lies ahead in the 2024 elections. For more from Jim Richards, check out his newsletter linked here: https://pro.paradigm-press.info/m/2327065
James Connor 0:00 There's a lot of talk that Biden will be replaced at the DNC. What are your views on this? Jim Rickards 0:05 Well, he might be replaced. I've said that myself. It's not a hard, fast prediction, I put a stake in the ground. But I certainly, I raised that actually last summer and 2013 three as a possibility, and I've written about it, and it could happen. If it happens, it won't be at the convention. It'll be really at the end of June, beginning of July, you know, in the coming weeks, you had to wait till the primary season was over. And it's not quite Ovios over next week. So you want the primaries to be closed, because you don't want you know, Gavin Newsom, suddenly running in the Texas primary, or whatever's left, just about, I think four or five seats left, first week of June. So you don't want that chaos. But on the other hand, you can't wait until the convention because you want the convention run smoothly. So if you're going to do the substitution, it would have to be mid to late June, early July the latest. So we'll see. But I consider that a real possibility. James Connor 1:00 Hi, and welcome to Wealthion. I'm James Connor. And today my guest is Jim Rickards, Jim has had a fascinating career as a lawyer and a banker, and he's the author of many best sellers. And we're going to tap into his knowledge today and get his thoughts on where he thinks the economy is, and also what he thinks of the current political landscape. Jim, thank you very much for joining us today. How are things in Portsmouth? Jim Rickards 1:25 Things are fine, Jim. It's a little rainy, but it's a nice town. Lots of great restaurants, lots of activity. So very, very enjoyable. James Connor 1:33 I'm gonna have to make a trip there some time. I want to start a conversation now with geopolitics. And there's so much turmoil in the world. We have an ongoing conflict in the Middle East, we still have an ongoing war in Ukraine. There's the ongoing threat of China invading Taiwan. And why don't we just start with the Middle East? What's your current view on how things are unfolding there? And do you see the threat of regional expansion in the Middle East? Jim Rickards 1:57 Yeah, the Middle East situation is pretty simple if people keep trying to make it complicated, but that we're at the start of the war that when the October 7 attack took place, the largest mass murder of Jews since the Holocaust, and that's what happened and worse than murder. And in many cases, I don't need to go into all the details, but I think they're pretty well known. So there were about 40,000 Hamas fighters. So Israel's goal was to kill 40,000 Hamas fighters, there are civilian casualties. There's a lot of infrastructure damage, but you got to kill basically 40,000 fighters, you don't actually have to kill them all. You probably have to kill 30,000 plus the top leadership to basically render Hamas done are gone as a fighting force. Estimates vary, they probably killed over 25,000 They probably have to kill five to 10,000 more they've wiped out Gaza City and things caught youngest who might get the name slightly wrong is one of the other cities in central Gaza. The downs of the USA which is Rafa, Biden told them not to go into Rafa no one cares or Biden thinks he says stuff all the time, but no one takes him seriously. Netanyahu knows what he has to do. So they're in to Rafa now killing as many Hamas fighters as they can. It'll probably take, you know, hard to say, but maybe another month to six weeks to finish the job. And then there'll be a ceasefire, because there won't be any moss left, you can get into. I love that $320 million we spent on the humanitarian aid pier that fell apart and a couple of days not, apart from wasting 20 to $20 million. Not exactly a compliment to the Seabees, the Army Corps of Engineers or whoever built it. I mean, it's, I'm glad this guy has been charged with D Day they probably would have invaded Ireland. But from a policy point of view, Biden is kind of irrelevant. Israel's going to do what they have to do. And what they have to do is simply just have to annihilate Hamas. James Connor 4:02 And let's move on now look at Ukraine, Russia and Ukraine war has been going on for two, over two years now. It's hard to believe but how do you think this situation is resolved? Jim Rickards 4:13 Well, it's resolving faster than expected Ukraine is. They've there about 500,000 Dead Ukrainian soldiers. So I hope, hope Tony Blinken and Jake Silva and Victoria Nuland are happy with that because they said they fight to the last Ukrainian and they're doing a pretty good job that 500,000 dead. Ukraine's military is in a complete state of collapse. They are if they're fighting, they're losing, and many of them are surrendering their mutinies. There are desertions when they retreat to some orderly fighting retreat to a defensive position is more like running for your life and the Russians are annihilating them with drones and heavy heavily armored helicopters, bombers, other other weapons systems, minefields, etc. They're now sending seven year olds out there since sending 17 year olds out when I say they I mean Ukrainians. They've instituted a draft. I haven't been there but I get a lot of pretty good intelligence, they say, the streets of Kharkov Kyiv lubob are empty because you know, men younger man say between 17 to 30 or just are hiding or leaving the cashiers are staying inside because they don't want to be you know, Dragoon off the streets and sent to the front lines if he gets to the front lines your life expectancy is about three hours that's how long it takes for the Russians to kill them. So they're getting beyond desperate. The wonder weapons have all failed we send them high Mars precision got it utility as artillery, rather precision missiles that took the Russians almost no time to figure out how to jam the GPS so the missiles don't know where to go. They just go off course. We sent them Patriot anti missile batteries, a billion dollars apiece, I think we sent about nine. The only problem is that those missiles back those anti missile batteries cannot shoot down hypersonic missiles. The Russians have hypersonic missiles. So they've been blowing them up. One at a time. There aren't many left. They got challenged your tanks in the UK leper tanks from Germany, Abrams tanks from the US and also Bradley Fighting Vehicles. From the US they've all been left burning on the battlefield completely ineffective, the armor is ineffective. So one by one Storm Shadow missiles, most of them shut down pretty much out of them. They're out of 155 millimeter artillery shells, because the Russian economy is making a million a month are on a complete war footing in western economies. The US is struggling struggling to open one factory that might make 30,000 or 300,000 a month except it's not open. So they're still trying to do that and our own supplies have been depleted. This is not just a question of Ukraine losing. It's a question of Western arsenal is being stripped. All these weapons are defective anyway, meaning they're obsolete and don't work against Russian offensive capabilities. But even allowing for that we don't have anything left. So everything and economic sanctions. I mean, I teach a course in financial warfare, the US Army War College I told my class was over two years ago, was April 2022. Right after the war began. I said the sanctions will fail. US sanctions on Russia will fail. But it will be worse than that. Not only will they fail, but they'll boomerang hurt the US economy more than hurts Russia. I looked at the data. I don't have it all my fingertips, but by every significant metric, unemployment, inflation, GDP growth, debt to GDP ratio, manufacturing PMIs cetera, Russia, the Russian economy is greatly outperforming the US economy. And in particular, the one that caught my eye was debt to GDP ratio washes 17% Partially debt free. Us as we mentioned about 125%. We're way past the point where the debt can create enough growth to even pay the debt. So So nice job, Janet Yellen. Nice job while he Odhiambo, the Deputy Secretary of the Treasury, the sanctions have been a complete failure. But they keep upping the ante. They keep the newest thing is to steal $300 billion of US Treasury securities owned by Russia. That's a good way to sync the US government securities market. And it won't work. They might try to do it that they're going to try to do it at the reach consensus at the g7 summit meeting in Italy, which is coming up on June 13. So just about two weeks away. Not clear what they'll do. There's some talk of folding a $50 billion bond issue backed by the Russian assets. It's just a backdoor way of stealing them. It's a structured solution to stealing the assets. Some talk about just using the interest, not the principle. That's about 70. There, there's assets earning about 3 billion a month. So it's been two years, it's about 6 billion of interest. pilot was just a smaller theft of a $300 billion debt. They're all part of why the world is trying to D dollar rising get away from the US Treasury securities. Now. It does not mean if they do it, and they're trying to do it and expect they will in some form. It does not mean the US Treasury market collapses the next day. I mean, you hear hysterical claims like that's not going to happen. But at the margin. It diminishes confidence in US Treasury securities and if you felt that and they do your say your Finance Minister, head of the Central Bank in a country that's running a trade surplus, and you're getting dollars. And you have to decide what to do with the money no different than your clients. How do you allocate your assets? Well, all of a sudden, you know, US Treasury securities don't look so good because the US is in the business of stealing them. Do you like Japanese government bonds, German bonds or Italian Government notes any better? I don't think so. If you lose confidence in the US Treasury securities market, why do those other vassal states look better when it comes to their government bond markets, so you pretty quickly ended up buying gold, you don't want to be a gold bug, just you as an asset allocator. If you can't trust the western model, I just mentioned the four biggest government bond markets in the world, Japan, Germany, Italy, and the US. If you can't trust them, and you want something liquid, you're not gonna buy real estate, not with your reserve position, you're gonna buy gold, and that's part of what's driving the price of gold higher. So again, despite two years of failure, the US and NATO seem to want to double down with this stealing the Russian assets. And the other thing Putin will do, or two other things Putin will do. And by the way, the thing that policymakers don't understand about Putin, he doesn't bluff. He actually thinks hard about what he says what he's going to say gets a lot of advice. If he says something, you can put it in stone, it's going to do it. So he's already said, if the West steals these Russian assets, and as I mentioned, they're planning to do that. Maybe in as early as about two weeks, he's going to expropriate all the Western assets in Russia. And guess what, they're more Western assets in Russia than there are US Treasury securities and the Russian reserve position, well over 300 billion, massive oil infrastructure from BP and, and shell, other oil companies, you can still buy Coca Cola and in Moscow, if you happen to be there. To take take the Coca Cola business, a lot of US companies made a show we're getting out of Russia at the start of the war. But they they didn't really and they might change some brands, close some outlets, but they're still massive investments and food, we'll just take all that give it to us, NAFTA, Gazprom or any of the other large Russian companies. But that's not the most dangerous thing he can do, which I expect he will 200 billion out of the 300 billion of Russian, US Treasury, Russian owned US Treasury securities that they're planning to steal, are in a place called Euro clear. Your clear is the largest clearing settlement custody Institute Institute in Europe, comparable to our DTCC, not quite as large but quite large, with over $40 trillion of assets in custody. They have offices around the world and they're based in Belgium, but they have offices in Hong Kong Dubai rep office in Beijing office in Singapore, etc. All Putin has to do in Hong Kong is an interesting case, because it's it's under the thumb of the Chinese Communist, but it still kind of walks in toxic rule of law jurisdiction, they have lawyers and courts and all that good stuff. All Russia has to do with Sue, you're clear. In Hong Kong, for wrongful conversion of its assets, get a judgment in its favor, run around the world, forcing the judgment by putting lien on other Euro clear assets of blood other class to settle the judgment. And you can throw a monkey wrench into the entire global monetary financial system. That this is the cause of this. So these, these ideas of the Treasury and the State Department and NATO, they're playing with fire and they don't they don't even understand. I mean, what I just said was pretty clear. I'm gonna be a lawyer. So I understand this pretty well. But they haven't even thought about it. James Connor 13:50 Politics at its finest. So that's a good overview of what's happening in the Middle East and also Eastern Europe. So I want to bring it back home now. It's an election year and it looks like another Trump Biden rematch at this time, but anything can change. And the RNC will be held in Milwaukee this year in July, and Trump is undergoing an onslaught of legal attacks. Do you think he survives these legal attacks? And will he become the next Republican nominee? Jim Rickards 14:15 Well, he will certainly be the nominee. He's already got more than enough delegates to do that. The and expect to win the election. Also. It's pretty clear in the polls, he's leading a national polls, which he's never done before. I mean, even when he won in 2016, he did not lead a national polls. national polls are kind of irrelevant because we don't have national elections. We have state by state elections to elect electors to vote for the president. But if you boil it down to the seven battleground states, he's leading in seven out of seven. He's leading in the betting odds he slipped by every measure Trump's ahead and people say well, Polls can change that's true. But wait now Yeah, May June is about when people lock in their choices. They're not very open to persuasion. So I do think it's a, it's a pretty good forecast of what's going to happen. So I would expect Trump to win having said that he might not make it to Milwaukee because he might be in jail. We're kind of awaiting the verdict and Alvin Bragg force, but I don't know what the verdict is going to be I do. I've done a lot of litigation work with some of the finest litigators in the world, they all tell me the same thing, which is that nobody knows what a jury is gonna do. Like that. You're gonna you're gonna spend millions and they do, and jury advice and jury selection research. And when they're interviewing potential jurors, they, they profile them, and they do background all all in real time. And this is quite a science. But having said that, every good litigator I've ever worked with I work with quite a few says You just never know where the jury is going to do. So I'm not going to forecast the outcome of the case. If he's acquitted, that's a big victory, even a hung jury is a very meaningful victory. If he's convicted. He might be in jail by July. So now, of course, the case will be appealed will certainly be overturned on appeal. But that takes time. So but just for viewers benefit, there is no prohibition. Well, there's, there's no you can be a convicted felon behind bars and still be elected president. There's no disqualification of prohibition on a prisoner of being elected prison in the United States. So I expect he will be but it's just a question of how far the Democrats want to take this. unconstitutional, farcical farce. You know, lawfare campaign, but we'll find out. James Connor 16:39 So we have the DNC coming up in August in Chicago, and there's a lot of talk that Biden will be replaced at the DNC. What are your views on this? Jim Rickards 16:48 Well, he might be replaced. I've said that myself, it's not a hard, fast prediction, I put a stake in the ground. But I certainly, I raised that actually last summer and 2013 fee as a possibility, and I've written about it and it could happen. If it happens, it won't be at the convention, it'll be really at the end of June, beginning of July. In the coming weeks, you had to wait till the primary season was over. And it's not quite over yet. It's over next week. So you want the primaries to be closed, because you don't want you know, Gavin Newsom, suddenly running in the Texas primary or whatever is left, just about, I think four or five states left, first week of June. So you don't want that chaos. But on the other hand, you can't wait until the convention because you want the convention run smoothly. So if you're going to do the substitution, it would have to be mid to late June, early July, the latest. So we'll see. But I consider that a real possibility. For a lot of obvious reasons, including the fact that the man senile can't stand up. Now, that side if he is the nominee, I there already, by the way, there's so many games going on, give me real quick example. To be on the ballot in Ohio for the presidential election on November 5, the party has to have a nominee by August 7. The Democratic Convention is August 19. Nice going Democrats, they just assumed the Ohio legislature would change the date they did. I legislatures like now it's August 7, that's, you knew that you picked your convention days on you. So so now the Democrats are saying, well, they're going to have a virtual convention, like a zoom kind of thing. You know, or I don't know, some computer virtual digital convention, where once the delegates establish their credentials, they'll nominate Biden by the end of July. And they'll do that because they have to be the August 7 deadline. So even if they haven't convention, I guess they will. But the the My understanding is Biden will not be at the convention because he can't really appear in public. He will already have been nominated by the end of July because they gotta beat this Ohio deadline, or else they won't be on the ballot November 5. That's interesting. And so the convention kind of becomes a joke. Having said that, there will be something going on at the United Center in Chicago and kind of brings up memories of 1968, which I remember very well, when those were anti war protesters who were beaten to a pulp by which your deli Chicago Police Department today she was on the other foot, that police department has been castrated, the mayor is a progressive probably favors Palestine. And there'll be massive, massive pro Hamas pro terrorists demonstrations all around the convention center. They've been denied permits to get too close. My guess is they my estimate is they won't care. And they'll be pleased right or confrontation. So Democrats will be interesting, it won't matter because Biden will already be nominated. Biden won't be there because he's kind of now comes matters. But there will be riots in the streets. So you know, probably keep away from Chicago at the end of August. If you're well advised. James Connor 19:58 Sounds like it's gonna be an interesting summer. Jim, as we wrap up, we are continuously being bombarded with negative news through social media. And we're always hearing how bad things are now, compared to other periods in history. And when I read about the 60s in the 70s, so many tumultuous events occurred, including the assassination, assassination of a president, we had the Watergate scandal, we had oil embargo, which resulted in double digit inflation and so much more. Do you think things are as precarious now as they were in the 60s and 70s? Jim Rickards 20:30 Yeah, I think they're worse down. I lived through all those anti war demonstrations. I was in college at the time. You know, y'all remember the assassinations. It was in seventh grade, when John F. Kennedy was assassinated. We didn't quite know what to make of it. We all went home and watched Lee Harvey Oswald get shot by a mafia hitman. You know, two days later, Jack Ruby? And yeah, and I remember it all very well. It was tumultuous as you describe. But, and there was a lot of angst over it. There were riots. I mean, I remember the Watts riots in 1965, Newark, Verizon, 1967. They were burning down cities. And I draft and I were protests, the war itself. I knew people were killed in the war, and so on. So and then if you got into the late 70s, a little later than the period you're talking about, yeah. 10% 13 15% inflation, the worst recession at the time since the end of World War Two. You know, so pretty wild ride, but through it all. Nobody thought America was coming to an end, they thought that there was violence, turmoil, protests, political disruption. Watergate was a big deal. Maybe the first example of lawfare. You know, we talked about lawfare today. Maybe that was just an early case. Hillary Clinton was a staff lawyer on the House Judiciary Committee that was getting ready to impeach Richard Nixon. So she got her training, training early enough. Last week, we heard of Hillary Clinton. But there was still a sense that America was America, Despite our disagreements, and no one thought that there was a threat to the Republic, even if there was a lot of political stress today, it's different with the fascist in the Biden administration. He, you know, fascist goon squads in the FBI. breaking down doors, no knock warrants permission, use lethal force against what a fancy house in Palm Beach. I mean, that's what they did. They broke down the door at Mar a Lago with winning with a SWAT team mentality. You see people at Peter Navarro Peter Navarro is a 73 year old Harvard PhD economist, brilliant, mild mannered but very determined a senior advisor throughout the Trump's first administration. He's behind bars. He's in federal prison for not cow tallying to the FBI. So, you know, the surveillance of Americans targeting Catholics targeting Imams for liberty, which is a group trying to preserve, you know, basic educational functions. So, I, you know, you look at Biden September 19, sorry, September 2022 speech at Philadelphia Independence Hall when he declared half the country, enemies of the people, it was floodlit, with the blood red floodlights pointing up and two marine guards and other flanks it was art directed by the ghost of Langey wife installed, who was Hitler's art director for the Nuremberg rallies. The lighting was identical to what the Nazis did Nuremberg, so, so there are real threats to the Republic and real threats to democracy that go beyond political turmoil and political disagreement. So I do think it's worse today. James Connor 24:06 Well, that was a fascinating discussion, Jim. And I want to thank you very much for spending time with us today. And if someone would like to read more about your thoughts on politics, or about the economy, where can they go? Jim Rickards 24:16 Thank you. My flagship newsletter is called Strategic Intelligence is from paradigm press. There maybe link up on the screen, we're available, but if you just do paradigm press, strategic intelligence, you'll find it. We have other newsletters, some some more expensive, but that's our flagship, we put an awful lot of work into it, produce, you know, seven 8000 words a month, 12 issues a year. So that's where all the things we discussed today and a lot more are available there. And so I have a new book coming out. It's available for pre order on Amazon, it's called Money GPT money GPT it's, it's about artificial intelligence in GPT as applied to The Capital Markets banking and national security. So I know AIG PT is a hot topic right now. But this book looks at it in relation to my lines, which are, you know, finance and national security and points out a lot of the dangerous but also solutions for investors to, to kind of come through and one piece. James Connor 25:23 Well, yes, that's a very relevant topic. And we're going to have to have a discussion just on that in during the next time. Once again, I want to thank you very much. Jim Rickards 25:31 Thank you. James Connor 25:33 Well, I hope you enjoyed that discussion with Jim Rickards and give you some insights on what to expect in the upcoming elections and also in terms of the economy. We all need help when it comes to planning and preparing for our financial future. And if you need help, consider having a discussion with a Wealthion endorsed financial advisor at Wealthion.com. There's no obligation to work with any of these advisors is a free service that Wealthion offers to all of its viewers. Don't forget to subscribe to our channel, Wealthion.com and also hit that notification button to be kept up to date on upcoming events. Once again, I want to thank you for spending time with us today and I look forward to seeing you again soon. Transcribed by https://otter.ai
