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The Biden Economy & Venezuelan Style Voter Difficulties

Episode #10  |  November 18th, 2020
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In This Episode:

Are we on the path toward Socialism? This week, Debbie D’Souza returns to shed some light on voter difficulties. She compares the 2020 Election to past elections in Venezuela. Then the legendary Neil Grossman, economist, mathematician dives into Biden’s COVID-19 plans. Grossman argues that the Fed and any potential Biden stimulus would create a false economy and artificial market gains.


Debbie D’Souza

Born in Caracas, Venezuela. The Venezuela she grew up in was much like America-prosperous and free, but that has changed dramatically and it is now a socialist country. D'Souza refuses to see America follow Venezuela's path, and that drives her work today. As a warning to Americans, she speaks about how the path that America is taking repeats many of the same policies that destroyed Venezuela. She is an advocate for conservative Latinos and hopes to educate them in the importance of voting for a party that reflects the principles of the majority of Hispanics. She has a unique perspective because of her dual nationalities reflecting both her Mexican-American heritage from her mother's side as well as her Venezuelan roots from her father's.

Neil Grossman

Former European Central Banker, former hedge fund investor, physicist, mathematician and attorney with an interest in constitutional law
Neil Grossman (retired) spent the last two decades in the financial industry working as a proprietary trader, asset manager and market-maker. In particular, he has traded liquid products in major markets around the globe, with particular emphasis on arbitrage-related strategies.


                                    [Music Plays] This is American Consequences With Trish Regan, a view of things you won’t get anywhere else. Trish talks the Fed, the White House, and the world like no one. The biggest guests and best analysis start right now. Here’s Trish Regan.


Trish Regan:               Hello, everyone, welcome to this week’s edition of American Consequences With Trish Regan. I am Trish. And wow, we’ve got a lot on our plate this week. A lot of questions right now about these voting machines and a lot of fears that maybe this wasn’t on the up and up. We’re going to drill down and get to the bottom of it. We’ve got Debbie D’Souza, whose publication, El American, is really looking in the connections between Venezuela and possibly Dominion voting machines. She’s going to join us with some incredibly interesting intel.


                                    Plus, Neil Grossman is back – the economist, the physicist, the mathematician, the constitutional scholar. And he’s got some choice words for any incoming administration that wants to pump money into the system, what it means for our economy, what it means for your investments coming up. But let’s get to Debbie first joining me right now. Debbie, good to talk with you.


Debbie D’Souza:         Good to talk to you, Trish. Thank you for having me.


Trish Regan:               All right, so we have a lot to dig into here. First of all, just your reaction to everything that’s happened thus far and the Trump campaign refusing to concede and saying, wait a second, let’s check the authenticity of these votes.


Debbie D’Souza:         Yeah, well like you, I was shocked that he was winning some of these swing states, and then in the middle of the night, he wasn’t. I have to tell you that many Venezuelan-Americans had a déjà vu moment when they woke up to the results of this election. I have to tell you that a woman by the name of María Corina Machado – I’m sure you know her –  she was a National Assembly woman.


Trish Regan:               She wants to be the first woman president of Venezuela by the way, for anybody who’s not familiar with her. Fabulous conservative woman there in Venezuela.


Debbie D’Souza:         She formed a voter integrity group called Súmate because in 2002, she was already predicting that Hugo Chávez would not go down without a fight, right? First of all, for your listeners that don’t know that Hugo Chávez actually lied about the fact that he was a socialist and that he was going to nationalize industry. People voted for him the very first election in 1998 because they thought he was going to be a hope and change kind of guy. Get my drift?


Trish Regan:               Yep, no, no. So very quickly, I’ll just tell listeners – because some of them may not know this – but my first job was actually working in finance at Goldman Sachs, and we were trading Latin American debt, including Venezuelan debt. And this is was in the summer of 1999, so Chávez was just coming to power. And I remember we were sitting there trying to figure it all out. And we were like, it can’t be that bad. I mean, he doesn’t really want to be a total socialist. We were worried about Lula in Brazil at the time. We weren’t as worried about Chávez. Turns out, we didn’t need to be worried about Lula.


                                    We did need to be worried about Chávez. And I think Venezuela is an excellent example of how in 20 years’ time, things can just change over time. Debbie, anyway, go for it. So he runs in 1998. He doesn’t really tell people what he’s planning to do, it’s just hope and change. And I get your drift.


Debbie D’Souza:         He won by a landslide, of course. When you promise free college, free health care, free this, free that, and you also disguise it by saying you’re not a socialist and that you won’t do it by force, people think, hey, this is a nice guy, he’s for the poor, all of those things. Well, by 2001, he had started expropriating businesses and confiscating land. So María Corina was aware. She was a National Assembly woman at the time, and she was aware that this guy was not going to go down without a fight. So she formed a voter integrity group called Súmate. And in 2004, they issued a referendum – a recall referendum on Hugo Chávez. And the exit polls – and this is I’m told by my family and friends in Venezuela – the exit polls all pointed to recalling this man. And it was like 60% to 40%.


                                    So they were very confident the night before the election that they were going to win this referendum. And the next day, it turns out that Hugo Chávez won 60% to 40% and they could not understand how that happened overnight. How did it flip like that? What happened? So María Corina’s group went in and wanted an audit of the machines, wanted to know how this happened, and they did all kinds of studies to see how this could’ve happened. Bottom line, Jimmy Carter went to Venezuela on the request of Hugo Chávez because Hugo Chávez was like, listen, I want people to know that this was legitimate. Jimmy Carter, of course, went down there and said, oh yes, these machines are the best in the world. And we hear that today with these Dominion voting machines, by the way, that are actually linked to Smartmatic, which were the exact same machines that were used in Venezuela.


Trish Regan:               [Crosstalk] And so there’s this link – I’m not entirely clear, I’ll be honest, on the link between Smartmatic and Dominion except that there are some reports that Dominion may have had a subsidiary in Smartmatic in 2004. Can you clarify any of that? The way I see it, Debbie, is these are electronic voting machines and electronic voting machines are vulnerable. They discovered this in Texas, this is why they didn’t use the Dominion voting machines in Texas because there’s a fear that they can be hacked. There are fears that they can glitch. And so in some ways, I don’t even care if it’s Dominion or Smartmatic, I’m looking at it saying – and by the way, I did a story on this years ago with Diebold voting machines because there were fears then that those things could be hacked.


Debbie D’Souza:         No, absolutely. Well, the really strange thing, of course, is that Smartmatic was the machine they used in Venezuela, it absolutely was. And they even talk about it in their website, They show that they used their machine from 2004 to 2015. And so these were in fact the machines that they used. Now, there are three men, Antonio Mugica, Alfredo José Anzola, and Roger Piñate, who founded the company in Delaware in 2000.


Trish Regan:               All Venezuelan, right?


Debbie D’Souza:         All Venezuelan, I believe Left-wing Venezuelans. They claimed that they wanted better machines to secure votes because they felt like when people count votes, they could count twice or three times, or whatever. So they thought these machines were going to do the trick in Venezuela. So they bid in Venezuela for several companies that did this type of machine, and Smartmatic won. So they were very proud of the fact that they did the selection.


Trish Regan:               OK, but Smartmatic was not used here, just to clarify. The company is saying that they’ve never owned any shares or had any financial stake in Dominion Voting Systems. Smartmatic has never provided Dominion Voting Systems with any software, hardware, or other technology. These two companies are competitors in the marketplace. I hear your point. These are machines, and they can malfunction like anything else, and they’ve malfunctioned in Venezuela. And so we need to be cautious and concerned that they could malfunction here.


Debbie D’Souza:         Absolutely. So Smartmatic was acquired by a company called Sequoia. And Sequoia was then incorporated with Dominion, which is a company out of Canada. So the three actually are linked – the three companies are linked. We will be happy to provide all those links for you. As you mentioned, El American has an article that has all of this information for your listeners.


Trish Regan:               OK, so Sequoia acquires Dominion – just forgive me, just walk me through the relationship.


Debbie D’Souza:         Yes, so Smartmatic is acquired by Sequoia. Sequoia is installed in about 17 states, but because of the linkage to Smartmatic and to Hugo Chávez – I think probably the best way to put it is they had to think of plan B. Plan B was Dominion, and it acquired Sequoia, which was still a part of Smartmatic.


Trish Regan:               OK, OK. Thank you for clarifying that for me because I feel like it’s a little murky. But just to go through it again, there was Sequoia, which was acquired by Dominion, but Sequoia had previously acquired Smartmatic.


Debbie D’Souza:         So the three companies are linked, and they all go back to those three Venezuelan men who founded the company, Smartmatic, in Delaware in the year 2000. And as you say, they tried three times in Texas to sell the Dominion machines in Texas, and three times they were denied. As late as 2019, the attorney general said, no, absolutely not. These machines are susceptible to rigging. So that’s the reason that they gave for not getting these machines. Now, I have to also mention that it is extremely difficult to prove fraud with these machines as you know. And in 2014, this gentleman by the name of Jiménez-Hidalgo did a forensic analysis using Benford’s Law and statistical models that detected irregular variations in the electoral role in Venezuela.


                                    So this was something that went against Jimmy Carter’s findings, of course, because he said it was the safest in the world. And they said, wait a minute, there are some anomalies here, statistical patterns that don’t make sense. And they have a beautifully laid out study that I sent you, and maybe you can put this link out for people to read. It is extremely – it’s eerie. When you read it, you are thinking oh my goodness, this sounds like what happened in the swing states with all of the sudden, in the middle of the night, Biden wins 138,000 votes and zero go to Trump. Another statistical anomaly.


Trish Regan:               Yeah, that was weird. So these were all the mail-in votes, right? Which I do think is a little weird. You can’t just tell me every single mail-in vote – and I believe that they’ve also come forward and said what was very suspicious is that some of these ballots only had the president marked. They didn’t have anybody else marked on it. So it was just a vote for Biden.


Debbie D’Souza:         So again, this is something that even goes beyond the voting machines because we, to be honest, don’t know what happened with Dominion voting machines. Of course, we have Sidney Powell and Rudy Giuliani saying that they have the goods on these machines and what happened. But we also know that there were also other types of shenanigans going on, not just with the voter machines. So again, voter integrity is in question.


Trish Regan:               What do you think else was possibly going on? Just indulge me for a second and indulge the listeners.


Debbie D’Souza:         So there were some areas where they found that deceased people voted. Of course, we know that the zombie apocalypse has not arrived, so this cannot happen. But they found that indeed, there were some voters that were deceased. Also, in Philadelphia, there was a case where they boarded up the windows – they didn’t allow the Republicans to go in there, the poll watchers. And I know that this happens, Trish, because in 2012, I was a poll watcher in 2012 here in Texas. And I saw some horrible fraudulent shenanigans in 2012. So I know they exist.


                                    And a group by the name of Truth of Vote, Catherine Engelbrecht is a good friend of mine, she started this group because of that – because they saw a lot of irregularities. So they founded this group, found that in Texas, Disney characters voted, illegals voted, and dead people voted. And so they needed to get to the bottom of it. That’s why in Texas, we have a voter ID law. Basically, when you go into vote –


Trish Regan:               [Crosstalk] This should be one giant wake-up call. The voter ID law is really, really important. You’ve got to be checking IDs, otherwise it leaves the system vulnerable to fraud.


Debbie D’Souza:         Absolutely, and I think the reason why that was out the window is because of all these mail-in votes that they got. Because in a usual election, of course, you do get a fraction of people voting by mail, absentee, which is normal. But this time, thousands of people voted this way, people that normally go in to vote. So did they actually certify the signature? Did they make sure that it was the same person? Did that person go in and vote in person as well as mail it in? Those things can happen. And again, obviously, if a machine is used and someone is able to rig a machine, then all of the voter ID laws in the world are not going to make a bit of difference. So we have to get to the bottom of it, Trish, but what’s really troubling to me is that the Democrats are not OK with us figuring this out.


Trish Regan:               You’re right. They’re not OK with anybody even asking questions, right, Debbie? So let me go back to what you were explaining and just to kind of drill down that there’s this company, Smartmatic, that was created by the Venezuelans that was used in these elections where María Corina Machado has alleged that they basically were able to hack these things. Is that a fair characterization?


Debbie D’Souza:         Yes, they stole the election in 2000 and beyond.


Trish Regan:               OK, so Smartmatic gets acquired by Sequoia which gets acquired by Dominion. And if you go back to 2010, and this is one of the things that El American actually references in their article, they’ve got the Huffington Post story that says, “On heels of Diebold premiere purchase, Canadian e-voting firm Dominion also acquires Sequoia, lies about Chávez ties in announcement.” So I just point out this is from the sort of Left-wing Huffington Post. But now you’re not allowed to ask these questions.


Debbie D’Souza:         That is a big problem as voter integrity is everything. And in Venezuela, people that are not Chavistas, not with the regime, feel like their vote doesn’t count anyway. And do we want to get to a place in America where we feel like our vote does not count? Is this where we want to be in the United States of America? Of course not. But one political party pushes the envelope like no one else, and I just feel like if they don’t want that shadow over their party, they should actually be OK with all of this. They should be OK with us uncovering what happened, unless, of course, they were in on it.


Trish Regan:               Look, what’s the expression? Sunlight is the best disinfectant. So Americans need to trust the system right now. You have well over 70 million people that voted for Donald Trump that are sitting there saying, wait a second, what happened? It’s a tragedy in that we’re going to wind up, I think, in a very divided place unless they’re able to figure this out. If you’re able to say OK, this is just the way it happens, it’s authenticated, we have full faith in our system, and Donald Trump lost and Joe Biden won, then people can move on. And they can say, all right, let’s look ahead to 2022 and 2024. But without that clarity, Debbie, you know, it feels very Venezuelan-esque.


Debbie D’Souza:         It does. And Trish, this is what tore away the fabric of Venezuela. This is why the Venezuelans became so polarized. It really tore away the fabric of voter integrity in Venezuela like nothing else ever had. And I feel like if we don’t get to the bottom of it, it’s going to do the same here in America.


Trish Regan:               I think that’s a very fair analysis. And again, there are questions out there, and the Left is saying any question you may have is a total conspiracy theory. I don’t get it because look, for four years, they sat there and said that Donald Trump stole the election. If you go back out on the campaign trail this summer, Joe Biden was even saying that. I’m like wait a second, this guy’s running for president and he’s effecting a kind of conspiracy theory – Donald Trump and the Russians stole the election. So it was OK for them to question at length in a very, frankly, disturbing way – because don’t forget, we got the Mueller Report, and it’s right there, the conclusion of volume one is that there was no conspiracy there in terms of the Russians and the Trump campaign. And yet, this was a thesis that was pushed out there constantly for four years, Debbie, and the mainstream media included. And yet, when people now in the conservative space say wait a second, let’s make sure that this was all on the up and up when it comes to the voting machines, they go crazy.


Debbie D’Souza:         They do, they do. And it’s really funny you mention that because Hugo Chávez said that of the opposition. They said that they were issuing a conspiracy theory against him. So he basically made María Corina Machado look like a kook saying that she was a conspiracy theorist for saying that there had been fraud.


Trish Regan:               [Crosstalk] Let me just say, she is an extremely bright woman and a very brave woman, very, very brave because they would love to lock her up.


Debbie D’Souza:         She’s amazing. I have hailed her as a heroine for decades. She’s amazing, and she’s brave. And the personal attack that she took from doing this was extremely great. I don’t think that people even realize that she many times was a victim of scuffles. She ended up with a black eye at one point when she was in the National Assembly, death threats, you name it. This poor woman has been through the ringer all because she wanted the votes to count. And even though in Venezuela, Hugo Chávez won fair and square the first time, she wanted him to win or lose fair and square any other time. And that just didn’t happen.


Trish Regan:               Right, and now I don’t know as you’re ever going to see anything really fair and square there in Venezuela. I mean, Maduro now seems pretty implanted there. I don’t know. Do you see it changing? I know that people are just devastated by all that’s happened.


Debbie D’Souza:         I don’t, and if Donald Trump is not able to prove fraud and he’s not able to stay in office, I think that Venezuela will never be free again.


Trish Regan:               Well, and also, this gets to Lindsey Graham’s point, right, where he’s saying if they’re able to take this in some way, how do we ever win another election. Or forgive me, that wasn’t Lindsey Graham. That was out of Texas, your representative there, Louie Gohmert.


Debbie D’Souza:         Louie Gohmert and Ted Cruz have both said that, yes. I agree. I think that if we are not able to prove fraud – and by the way, there have been many people that have come forward signing affidavits giving their account of all of the anomalies that they’ve witnessed themselves. But if we are not able to prove that this happened in court, of course, where it counts, then I do believe that all is lost and that they will be able to do it again and again. And we may not ever be able to have a Republican as president again. And I fear that that is where we’re headed. And I’ve feared that this is where we’re headed for a very long time because even these last four years, Trump is president, but Trish, he was never really in control. The Left has always been in control of the narrative through the media, through social media. And so if they’re allowed to actually be the head of our White House, I just fear that we will never have a free election again and down goes the road to Venezuela.


Trish Regan:               I want to go back to this just because – forgive me, but I’m perplexed by all of this with the companies themselves. Because Dominion has another statement out, and they say, “Dominion and Smartmatic do not collaborate in any way and have no affiliate relationships or financial ties.” They say, “They’re totally separate companies and a fierce competitor. Dominion does not use Smartmatic software. The only associations the companies have ever had is in 2009, Smartmatic licensed Dominion machines for use in the Philippines.” Oh by the way, that was a disaster. That was a disaster of an election. And it says, “The contract ended in a lawsuit.”


                                    OK, so they licensed Dominion machines for use in the Philippines – Smartmatic did. They used Dominion machines, and that was a disaster. “In 2010, Dominion purchased certain assets.” That’s the issue. That is the issue. “In 2010, Dominion purchased certain assets from Sequoia, a private U.S. company. Smartmatic, a previous owner of Sequoia pursued legal action against Dominion.” Well, this is where it gets murky. This is where you start to see some of this overlapping. So they’re saying they do not collaborate in any way and have no affiliate relationships or financial ties, yet in 2010, they did purchase – and they admit this – certain assets from Sequoia. And Sequoia was owned by Smartmatic.


Debbie D’Souza:         Yes, that’s correct. And the other really interesting thing of all of this is Dominion is part of the council that disputed the election integrity concerns. So basically –


Trish Regan:               [Crosstalk] In Venezuela?


Debbie D’Souza:         No, here in America. The CISA, which is the Cybersecurity and Infrastructure Security Agency, part of the Homeland Security, they issued a statement saying that the election was the most secure in American history. But what they failed to disclose is that Dominion Voting Systems is a member of CISA’s Election Infrastructure Sector Coordinating Council, as is Smartmatic. So it just really is unbelievable. That was in Epoch Times, by the way, an article that they just put out.


Trish Regan:               Look, here’s what I’m going to come back to, they can sit there and say – and they do say this on Dominion voting – they say assertions of voter fraud conspiracies are 100% false. OK, so let’s go with that for a second. Let’s assume it’s all a conspiracy, it’s 100% false. The reality is people are questioning it. So that gets me back to again – and we’re talking about back in the year 2000 that I was doing the story on Diebold voting machines and there were a lot of people on the Left that were worked up about this because they didn’t trust the system. Look, technology is a funny thing, right? And I do think that no matter what, Debbie, you have to fundamentally have trust in the system for this all to work, otherwise it’s some kind of house of cards. And before you know it, we do turn into a banana republic.


                                    And so in order to have that faith, maybe the answer is you don’t rely entirely on technology. Maybe this has got to be some kind of old-fashioned system, and you have to prove your identity, and you have to show your license. Maybe we actually need to go back to our roots in some ways to try and weed this out – any kind of perception of conflict or perception of hacking or anything that could happen. Because as long as those fears linger and you’ve got a close election, you’ve got people that are going to say, wait a second, this isn’t fair.


Debbie D’Souza:         Right, exactly. And why can’t we have an audit of these machines? Just an audit just to make sure that they didn’t double count, or triple count, or put in a code that meant that any vote that went for Trump went for Biden. Why can’t we see all that? Why can’t they open up the machines and systematically go through – forensically go through – the machine to make sure that there were no shenanigans?


Trish Regan:               I don’t think it’s too much to ask. It’s our election, and it was a close one, and there are these mathematical inconsistencies, as you point out, in that study. I think that’s just sort of the bottom line here because otherwise we’re going to be left in the state where people just don’t trust it. And look, we went through that for four years. The Left did not trust that Donald Trump won the election fair and square, and now it’s like we’re right back where we started. It’s just reversed.


Debbie D’Souza:         Exactly, right. And unfortunately, if they’re winning, they don’t want voter integrity. If they’re losing, they’re all about it. So this is where we need to come together as Americans and say, listen, voter integrity is voter integrity. It doesn’t matter whether a Right-wing candidate wins or a Left-wing candidate wins, Republican, Democrat, whatever. We want a fair election. We want to make sure that we are not a banana republic. We want to make sure that people trust the system and trust the votes, and that’s all we ask for.


Trish Regan:               And that’s not asking for much, that is basic. Voter integrity is voter integrity, I agree.


Debbie D’Souza:         Absolutely, and this is what I tell all my Democrat friends. Listen, if your candidate won fair and square, I won’t like it, but I will accept it because he was able to fool the electorate into voting for him and that’s one thing. And I basically know why he was able to do that, but if that’s not indeed what happened, if fraud was a part of this election, don’t you want to know the truth? Did people that followed Lance Armstrong get excited when they found out that he won by cheating? You know what I mean? It’s not really a win if you cheat. So I can’t imagine that someone regardless of what party you belong to doesn’t want an election that is secure and free of fraud.


                                    That is all we ask for. Whether or not Trump wins after all of this, that is to be decided by the voter. But it is not to be decided by a fraudulent electorate – a fraudulent machine or party that wants those votes to go to their candidate. That is what we cannot and should not expect. We the people demand voter integrity and regardless. So that’s all we ask. It’s not a hard thing to ask for.


Trish Regan:               I don’t think you’re asking for too much, I really don’t. Debbie D’Souza is the new columnist for the brand-new site El American, which is in Spanish and in English, and looks at so many of these issues. I’ve got to tell you, I was sent this particular article by multiple people who said this is the best article that really drills down and looks at this because there are – and I’ve been saying it all along – so many comparisons that one could make to Venezuela. Anyway, Debbie D’Souza, thank you very much for taking the time to really drill down and look at all of that for us.


Debbie D’Souza:         Thank you, Trish. Thank you for always seeking the truth.


                                    [Music Plays]


Trish Regan:               There are a lot of questions about where the economy goes from here. How much more spending can we really handle? Is it going to be a very dark winter as Joe Biden promises? Joining me right now is our good friend – one of my smartest friends, I’d like to say. He’s a physicist, he’s a mathematician, he’s a former attorney, and a legal scholar. I know I’m leaving some things out – oh, economist of course, having worked for the Central Bank of Norway. I’m so happy to have back with us my good friend, Neil Grossman. Neil, good to have you here.


Neil Grossman:           Thank you, Trish. You left out grandfather too by the way.


Trish Regan:               That’s the most important part. And husband to a wonderful woman. Let me get your take sort of on what we should expect come January 2020, into February, into March. You’ve got the COVID-19 task force for Biden assembling right now, and you’ve got a doctor on there that says we need to shut down for six weeks. And he actually said – this is a direct quote – we can pay people to lose their jobs because the savings rate is so high and interest rates are so low so we can just borrow this money. I know that just has to give you heart palpitations, Neil. So, your take on that?


Neil Grossman:           I don’t really generally believe in handouts. If the government wants to lend people money, that might be one thing. But at the end of the day, simply printing money and handing it to person A, means somebody else has to pay that back. So we were talking about this earlier, it’s sort of like musical chairs. You’re moving one chair from the future into the present, but there’s a seat missing when you get to the concerts down the road. I think we both know what’s at least in line from the Biden administration.


                                    They want to spend an awful lot of money. That’s both in terms of general policy as well as basically, the more money handouts to people often, the more votes you can buy and the more people become beholden to you. And I think there is a general unwillingness to sit back and tell people we don’t have this and we’re going to have to figure out a more intelligent way to address some of these issues.


Trish Regan:               When you talk about a more intelligent way to address the issues – let’s tackle COVID-19 here. Good news, right, on the vaccine front. Both Moderna and Pfizer have gotten through stage three trials with some very promising results. So that has been sped up, by the way, thanks to Operation Warp Speed – though I don’t think Biden wants to give Trump any credit for that one. But nonetheless, there’s really good news on that front. But you’re still in this challenging time from a health perspective because you’re going into the dead of winter and people are more likely to get sick. And they’re seeing the escalation of these infection rates. So how do you manage to keep the economy alive and going through a challenging time without giving out the stimulus?


Neil Grossman:           Giving out or maybe lending it are two very different tasks to take.


Trish Regan:               Would you consider lending then? You say giving out and lending are two different things.


Neil Grossman:           As a general matter, if you’re going to give somebody money, unless they have a legitimate need, the answer is that they’re the ones who owe the money back. I don’t think simply saying here’s a dollar for you to spend and I’m going to go find somebody across the street to pay for you is stimulative. And there’s just so much moral hazard in what we’re doing and the way we’re doing it. Keep in mind, the amount of fraud becomes significant. They tried to save a lot of companies, and yet the number of companies that are out there going under is growing pretty significantly.


                                    I think the answers in this are – look, let me try another one with you also. We’ve stopped letting landlords and people who have small businesses making real estate available to people living there from collecting. They’re in trouble. What’s going to happen on the other side of that? What would happen for example, Trish, if instead of saying to the person on the street “Here’s a dollar,” we say to the landlord, “Here’s a dollar to pay for your tenant”? I haven’t really thought it through yet, per se. Or you say to the restaurant owner, “We’ll lend you the money and we’d like you to…” And you don’t give it to the person, the person goes in and gets a meal at half price for that.


Trish Regan:               What you’re talking about is creativity. And to your point, you haven’t thought it through. I haven’t thought that through either, but you’re saying let’s come up with some more ideas, right? Rather than just printing money and handing it out.


Neil Grossman:           And not thinking about what the consequences – look, I’m a believer that you don’t create something out of nothing. We had a $3 trillion CARES Act, which has imposed a $3 trillion obligation going forward. So for example, I think you’ll like this, Elizabeth Warren tweeted this morning about forgiving all the student loans, what a drag it is on the economy. The total amount of student loan debt is about $1.6 trillion. We spent twice that amount on the CARES Act, and I’m not sure we got for it in a big way, other than creating another obligation down the road that’s really, really large.


Trish Regan:               Joe Biden is talking about $3 trillion more. Look, he may not get to first base because it may turn out that Georgia goes to the Republicans, and if you’ve got the Republicans there, they’re going to really block a lot of this spending in a rather large way I would think. So it may just mean we’ve got a dark winter all around. There’s no stimulus, there’s no nothing. He can get up there and talk about kumbaya and let’s all be united, etc. But I don’t know if he’s going to be able to be effective on the policy front without the backing of the U.S. Senate. Your thoughts, Neil?


Neil Grossman:           That’s correct. Now let me just say one more thing, Trish. I do not believe that any of this is truly stimuli. Again, this is the rearrangement as opposed to the actual long-term impact. You spend $3 trillion you don’t have, you have to pay the $3 trillion back. So if you take a long-enough time perspective, the net of this is not going to be particularly stimulative. It makes today look better, but it does not tell you that tomorrow is going to look that good. And we had $3 trillion already that’s going to be – whether it’s $2 or $3 trillion or $1.8 trillion more on top of that because I don’t think the Republicans necessarily are going to stand in the way of something that’s relatively significant.


                                    They may not go all the way to what the Democrats want. But I think if this country is shutting down for the next three months for argument’s sake because COVID-19 is accelerating and we’re not quite ready with vaccines and we don’t have the hospital space and the medical staffing to fully deal with this, you’re going to get some sort of, I assume, negotiated outcome to help us through that. Look, and then on the other side of that, he’s going to be coming back and saying to Congress, I want $7 trillion over 10 years. Some of it is probably for very legitimate purposes. Listen, infrastructure in this country needs significant upgrades, and his policy – who pays for it is another issue. But that’s the type of long-term investment that I think both parties like to see.


                                    I have no clue what’s going to come out of this Green New Deal, which I think is an extraordinarily expensive concept. That’s what, $3 trillion he’s talking about spending to change the direction of the country on how we operate from an ecological perspective? I think they’re talking about bailouts of student loans or significant adjustments in student loans. Ultimately, you’re going to run up quite a tab, and on the other side of that, he’s talking about taxing businesses and individuals in the very upper echelon, I think 90% to 95% of what he’s indicating he wants to generate on the revenue, which still is well short of what he wants to spend by the way. It’s going to come from the upper 1% to 5% of taxpayers.


Trish Regan:               Which I know has you really concerned. I should point out you’ve written some very good pieces actually for, very good opinion pieces on taxes including your frustration during the Obama years with how there was this assumption that you could just go and tax people more. And for you, I know you find that sort of inherently un-American and disingenuous and not fair.


Neil Grossman:           That’s right. Particularly, the way the dialogue comes out, they point at people in the upper echelons and say you don’t pay your fair share. There are people who find ways to reduce their tax burden significantly, but a lot of us pay significant tax burdens, I mean percentage and absolute amounts. It’s almost oppressive No. 1, listening to it, and No. 2, it tends to depress the drive and desire to innovate, to succeed, to create long-term outcomes that are far better than where we’re starting from. All you do is look back. Again, this segues us to a lot – but this ’07, ’08, ’09 crisis was disastrous. And you and I both have discussed this. I placed much of it at the foot of the Fed, right?


                                    Zero rates or very, very low rates and predictable outcomes that are designed to eliminate risk from the decision tree and to promise people the pot of gold at the end of the rainbow no matter what actually happens is a problem. And ultimately, participants in the capital markets following the path of free money destabilize this economy by pouring money into untenable real estate investments which became known as the Subprime Crisis. And it almost brought this country to its knees. It did bring this country to its knees. Luckily, we were able to slowly stand up, but it was not exactly a rip-roaring outcome. We grew after the crisis on average a couple of percentage points a year at best.


Trish Regan:               No, it was lousy. Frankly, I blame Barack Obama and Joe Biden for a lot of that. I blame the Fed, but then the aftermath I blame on those guys because the world was their oyster. They could’ve done a lot, but they didn’t. And they kind of got in the way of things, and it was constant Debbie-downer, my goodness, like I said. No cheerleading, no excitement for when we were doing things right. The just wanted more and more policy-wise. Then they couldn’t get to first base frankly on any of it policy-wise. There was no innovation. So consequently, it became the Federal Reserve. They were the only game in town, Neil.


Neil Grossman:           Right. Well, first off, the Obama administration as we talked about, I found accusatory. How dare you have – No. 1. No. 2, for all of the rhetoric under President Trump about him being difficult, President Obama drew a line in the sand and said if you send me any piece of legislation that does X, Y, and Z, I’m going to send it back to you. Which ultimately by the way, Trish, ended up in virtually almost nothing getting done. Obamacare got done, and I think we ended up outside of some of the provisions in the rescue early on. I don’t remember too much that was accomplished from a legislative perspective during those eight years.


Trish Regan:               And so consequently, at least from an economic policy perspective, he got his Iran deal done – lovely – and he got Obamacare done. But in terms of the sort of meaningful fundamental influence on the economy, I don’t think he really was able to accomplish much. So I don’t have high hopes. I don’t think you do either for the incoming administration in terms of what they’re going to be able to accomplish. What’s the takeaway for investors? With just a minute left, how should people be approaching this? Because right now, the market’s still on fire and you’ve got Goldman Sachs predicting 4,300 on the S&P by year end 2021. You have very strong targets as well over at Morgan Stanley. How should people think about it?


Neil Grossman:           Look, I’m extremely concerned. I think the stock market trades at now almost – S&P trades at almost 30 times, 27 to 28 times, which is just about twice historical averages. The only reason the market’s here is you’ve got a Federal Reserve that’s basically printing money functioning the form of intervention policy and a government that’s standing there with a population that’s expecting handouts to continue and to continue. I guess if the government is going to print $3 trillion or $4 trillion or $5 trillion dollars in the next year, maybe the stock market goes up. But I think it’s going up on air, and I think the risk continues to grow that the only thing that we’re looking at is a continuing series over the next couple of years of the Federal Reserve having to theoretically come in and bail out every market in its way. I don’t think this market is stable anymore. Now, that’s me. Again, I will tell you, you know me, I don’t believe you can make something out of nothing. Physics tells you that.


                                    And I also think that what the Federal Reserve has done is it’s becoming what I call the enemy of the rational. You cannot make rational decisions on valuation or long-term investments because they continue to shorten the time scale and the expectations. And the consequences of markets going down are becoming more and more profound. Can you imagine if the stock market loses 50% of its value in the next nine months or 12 months? Why not?


Trish Regan:               Why not? Because well, to your point, we’ve got a Federal Reserve that’s there that’s willing to extend its arms and just catch it if need be. And so that’s why we can’t conceive of that happening. I can sort of conceive of that happening because I’m a little like you, Neil, and I don’t trust this idea that you just keep printing, printing, printing. I think at some point, there’s going to be consequences for these actions. But listen, I think this is some important advice for everybody to keep under consideration right now. They have become the enemy of the rational, Neil Grossman’s words. You can read his columns on You can hear him here on American Consequences With Trish Regan. Neil Grossman, thank you.


Neil Grossman:           Trish, always a pleasure.


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Trish Regan:               Fascinating edition as always. Make sure you tune in every single week here to American Consequences, and you can catch me every single day on Trish Intel. There’s a lot going on, and I’ll tell you one thing: truth matters. You know I am fearless, and I’m always going to get to the bottom of everything. So make sure you subscribe to American Consequences, Trish Intel, and I’ll see you right back here next week and tomorrow online.


                                    [Music Plays] Thank you for listening to this episode of American Consequences With Trish Regan. For more of Trish and to read the magazine, visit and enter your e-mail for special access. We’d love to hear from you, too. Send Trish a note, [email protected] This broadcast is for entertainment purposes only and should not be considered personalized investment advice. Trading stocks and all other financial instruments involves risk. You should not make any investment decision based solely on what you hear. Trish Regan’s American Consequences is produced by Stansberry Research and American Consequences and is copyrighted by the Stansberry Radio Network.


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