Yesterday, I wrote about my colleague Greg, who has been absolutely demolishing the markets, making a 254% return on his model portfolio since last May. That’s beating out some of the very best in the world… and that's why I respect him so much.

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Today, let me tell you about my latest Paradigm Press YouTube Channel chat.

Click the pic or here to watch the video.

Jeff Deist is the former president of the Mises Institute and the author of the excellent A Strange Liberty.

He’s now with Monetary Metals as their General Counsel. Jeff’s also one of the most level-headed and nicest people I know.

Wokeness

Jeff, the acclaimed author of A Strange Liberty, shared his lucid perspectives on various critical issues, from the evolution of political correctness (PC) to the modern challenges of "woke" culture. He believes what began as a benign attempt to refine language has snowballed into a more ominous, all-encompassing social control.

I think PC is a term we've been using really since the 90s, and I think it's obsolete. It's been replaced by the term “woke,” which we'll get to, which I think is broader. But PC was mostly about language. It was an attempt to control our words, spoken and written. So PC really focused on language, you know, and PC gave us things that seemed benign, like calling people African Americans instead of Blacks, for example. 

But it also gave us the beginning of a mindset. In other words, when you're trying to control people's language and their speech, written or oral, you're really trying to control their thoughts. And by controlling their thoughts, ultimately you're trying to control their actions. So the idea is that we should be nice to each other, we should be inclusive, and we shouldn't use certain words, and I agree with that, but only to an extent.

Fiat Money

In our dialogue, Jeff provided a deep analysis of what he terms "political money" – the root of many economic woes. He argues that shifting from a commodity-backed currency to a pure fiat system has muddled our understanding of money, debt, and interest rates, further complicating economic stability.

In other words, we talk about sound money versus fiat. We talk about commodity money versus paper money. We talk about hard money versus expansionary money. So we've come up with all these terms to describe what's happened, in particular to the U. S. dollar, but really to all the Western currencies. I would argue even the Swiss franc has fallen in terms of the mindset of the Swiss Central Bank, which I do follow.

I'm very interested in the stocks they buy and some of the other things they've done, because I heard an interesting talk a couple of years ago by Rahim Taghizadegan, our friend in Austria, about how money used to be a country's calling card. You know, the Swiss franc was the calling card of the Swiss people, and they were rightfully proud of it. 

And so the policies backing that the Swiss franc really was as good as gold for many, many years. The U. S. dollar, of course, has not been as good as good as gold since at least FDR's time. And really, there were episodes in U. S. history prior to that, uh, where the U.S. federal government was operating its own bank or expanding to pay for wars, even the Civil War itself. We've always printed money to pay for wars, so the U.S. dollar hasn't really been as good as gold for much of its history. But, what FDR did, and then of course, all the expansions on that through Bretton Woods, and then ultimately Nixon's actions in the 1970s, all that gave us a form of money that is totally divorced from any commodity backing 

And as a result of that, we've started to become confused and are thinking about what money is and what its function is. And since we don't much understand money anymore, we don't understand interest rates and debt, which are directly related to money.

These things have all become combined in our muddled thinking. And so I would say the average young quant in the finance industry, maybe on Wall Street, maybe a central banker and this might be a young person under 30 or 40. who went to Wharton or Stanford or Cambridge or Oxford, all the right schools, but he or she might really have no real understanding of what money ought to be, other than it's a political tool. 

In other words, money has just become a tool for governments and central banks. It's become a form of policy, and so I hate the term monetary policy. I've always thought that we should deride that term. We don't need a housing policy. We don't need an energy policy. We don't need an agriculture policy. We don't need a money policy either.

Biden or Trump? How About Neither?

We also touched upon the changing political landscape, especially with the 2024 elections. Jeff expressed concerns about the potential resurgence of neoconservatism and the diminishing influence of the America-first populist right.

In January 2025, I don't care how many votes he gets, folks. Donald Trump will not be allowed to enter office. Okay, so the question becomes, Will they stick with Biden? I think they're going to throw him under the bus. I think they're going to realize that this man is decidedly infirm. And in really bad shape, and so that means we need a Gavin Newsom or Michelle Obama, someone more palatable.

De-dollarization: Now, Later, or Never?

As for the future of the global monetary system, Jeff believes that while the U.S. dollar remains dominant for now, its position is increasingly challenged. The emergence of alternative currencies, like those proposed by BRICS nations or digital currencies like Bitcoin, could reshape the economic landscape, though not without significant hurdles.

I definitely think in the short term, the U. S. dollar is that one currency the world wants as political as it is, it doesn't make me happy to say that I think the dollar has been a tool, not only of domestic policy spending on entitlements, but also of war. It's been a foreign policy tool for the U.S. government to spend wildly beyond what it takes in tax receipts and run huge deficits because the whole world needs our dollar and a proxy for holding dollars is holding U. S. Treasuries. So, you know, it's been a very nice arrangement for us. The dollar world has just been disdained. The French finance minister called it our exorbitant privilege, and he was damn right.

And I think a lot of Americans are asleep at the wheel as to how wealthy we feel as a result of that, of being able to effectively export inflation versus how productive we really are to deserve that feeling. Well, so we've had it good for a long time, and I do think that's coming to a natural end, but it's not around the corner.

Wrap Up

In closing, Jeff offered sage advice to young viewers grappling with the current housing market – emphasizing the importance of flexibility and willingness to consider less conventional paths.

This interview with Jeff Deist not only provided a wealth of knowledge on these pressing issues but also a reminder of the complexity and interconnectedness of our global economy and politics.

For more level-headed analyses, follow Jeff on Twitter at @JeffDeist.