On today’s episode of Trend Following Radio Michael Covel interviews Jim Rickards. Jim was front and center during the 1998 LTCM blow-up. He was a partner and general counsel for Long Term Capital Management. Following their blowup, he was principal negotiator in the 1998 bailout of LTCM by the Federal Reserve. He has had a bird’s eye view of some of the most interesting events in the economy over the last 20 years.
Jim and Michael start the conversation off talking about WikiLeaks, who the global elites are, and how they are slowly being exposed. WikiLeaks is showing the private face of how politicians think and giving a behind the curtains look into their lives. People are losing confidence in these “elites” and the “elites” are starting to lose confidence in themselves.
In Jim’s latest book, “The Road to Ruin: The Global Elites’ Secret Plan for the Next Financial Crisis,” he talks about 1998, 2008 and 2018. Jim gives these dates as examples of financial crises that happen (and will happen) every six to ten years. He relates financial panics to earthquakes. If you could stop an earthquake mid earthquake, this is similar to how we have been dealing with financial crises over the years. When bubbles are created, and then bailouts occur, government is only putting a stopper in the problem, however the problem is still there and building. The next bailout can’t come from the central banks.
Jim and Michael finish the podcast discussing cyber hacking and WWIII. Jim believes WWIII has already begun between Russia and America on a cyber warfare front. Cyber warfare has been happening between Russia and the U.S. for years. It is the worse kind of attack because you can get into major operating systems. Jim uses the operating systems of the Hoover Dam or getting into the operating system of the New York Stock Exchange as examples. If a terrorist got into the operating system of the Hoover Dam and opened up the flood gates it would wipe out hundreds of thousands of people.
In this episode of Trend Following Radio:
- Long Term Capital Management
- Federal reserve and bailouts
- Efficient market theory
- Bayes theorem
- Complexity theory
- Cyber warfare
“Don’t debate the claims, debate the science.” – Jim Rickards
“Doesn’t matter how smart you are, if you have the wrong model you are going to get the wrong results every time.” – Jim Rickards
Mentions & Resources:
- Jim Rickards
- The Road to Ruin: The Global Elites’ Secret Plan for the Next Financial Crisis
- Free copy of Jim’s new book: Go here.
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