Why The Official Story Doesn't Match Reality

[00:00:00]Good morning, everyone. Welcome to Join the Dots.

[00:00:04]I've got a one word that I want to say to you today, and do excuse the chainsaw massacre going on next door.

[00:00:12]Um one word I want to say to you today, and it's a word you know that I'm going to use time and time and time again because it represents everything that is wrong with this world.

[00:00:22]Trust, or lack of it.

[00:00:25]Lack of trust is showing itself now in every sphere of the world.

[00:00:31]Whether that's politics, whether it's geopolitics, whether it's health systems, whether it's judiciary, whether it's police force, whether it's the law itself, trust is being destroyed.

[00:00:44]Is it deliberate? We'll come on to that as we go forward in this journey on Join the Dots. But first of all, let's try and stay with the financial aspects of trust. Okay? And see whether we can build a picture that shows you, through joining the dots, what is happening to trust in the financial system. Okay?

[00:01:08]First of all, we start with gold. Now, one of you the other day, one of you viewers, thank you very much, pointed out that the FT did an article on lack of trust in London and New York to hold gold on behalf of countries. And that's true. And there is a piece actually out, and I will link it, Craig will link it. Central banks are rethinking where they store their gold.

[00:01:31]Well, we knew that. We knew that. But it's good to get it in a printed article where those people who can't listen, but can only read official things, can also understand what we understand as critical thinkers, that the trust has gone.

[00:01:46]Now, this follows, of course, the Russian bond seizure by the Joe Biden administration, which led everyone then not to trust US Treasuries. So, first of all, they knew that they couldn't keep treasuries and be trusting of the American system.

[00:02:03]So, that's why gold then started to overtake treasuries as the largest tier-one asset in most central bank balances. Yes, some of that was due to the rising price of gold, but also it was due to the rising amount of gold and decreased amount of treasuries held by central banks.

[00:02:24]So, trust is the first word and it's so important. If you don't have trust in a financial environment, whether it's your bank or your partner or whatever, if you don't have trust, finances mean nothing, do they? Because you can't rely on them.

[00:02:39]So, what else do we see? Well, we see financial institutions, don't we?

[00:02:43]We see private credit, private equity, we see commercial real estate. The trust in all those institutions peddling, I would say, some people would say providing a service. I would say peddling a commission-based product to people, cuz that's what they do. Let's be honest, they peddle commission-based products to unsuspecting, innocent investors while earning a huge commission, paying massive salaries, and they don't give a damn if the thing doesn't pay.

[00:03:17]They don't. But we saw that in 208, didn't we? With all the derivatives on on mortgages. We saw it.

[00:03:23]And now we're seeing it again.

[00:03:25]Many, many fold increase in value and volume and type of assets that are being peddled to you and your pensions.

[00:03:40]Private credit, private equity, commercial real estate. BlackRock has huge runs now. It's got runs on all its funds. People want their money out.

[00:03:48]And I'm going to link a piece here from Eurodollar University because it shows you that the even the largest and most experienced asset managers are not now trusted. Okay?

[00:04:02]And the ability to withdraw your funds, not trusted.

[00:04:07]The ability to invest and be sure of getting your money back, not trusted.

[00:04:12]Exits clogged. You can't get your money out because the exit has to be with has to be reduced to a tiny amount, maybe 5%. Why? Because they haven't got the money, have they? They've invested it in private equity, private credit, commercial real estate.

[00:04:28]Things that aren't going to pay in this world.

[00:04:32]So, where's your trust? So, I will link Jeff there of Euro Dollar University. I will also show you two charts that he produces.

[00:04:41]Okay, Craig will link those now.

[00:04:44]And if you read the definition of those charts, it shows you what's happening.

[00:04:48]Jeff talks about it in the first two three minutes of this presentation.

[00:04:51]That's all you have to watch.

[00:04:53]He generally sums it up at the beginning, which is great, and then talks about more detail later. If you've only got the concentration for a minute or two, watch the first two minutes.

[00:05:02]Look at those charts and see what's happening.

[00:05:06]The amount of money going into the products is not enough. Now, everyone knows what a po- or everyone has heard of the word Ponzi scheme. What does a Ponzi scheme mean? It means using the money coming in later to pay back dividends or capital repayments to the people who put their money in first. Okay? So, in fact, they're not showing returns. All they're doing is using the money coming in later to pay back the people who put the money in first. That's a Ponzi scheme, and it always ends in tears, always.

[00:05:37]Okay? So, what we got now is a lack of trust in even names like BlackRock, Blackstone, Goldman Sachs. No trust. And no trust, of course, in London bullion market, New York bullion market holding gold. So, can you see it?

[00:05:55]From the very top down, trust is disappearing at every level.

[00:06:00]And I'm going to link another one for you today. It's a piece from Ox Ox talks.

[00:06:06]And it's on a a capital fund called Poland, p o l e n, Poland.

[00:06:11]And they are in real trouble. And it's a 50 billion-dollar fund. Now, 50 billion now sounds nothing, does it? You know, when you hear the word 50 billion, you think, "What's that?" It's 50 thousand million.

[00:06:26]That's what it is.

[00:06:28]It's not a small amount. Yes, we see the word trillion used every day now.

[00:06:33]But 50 billion is 50 thousand million.

[00:06:38]That's a lot of money.

[00:06:40]And that's just one small fund.

[00:06:42]Trust gone, okay?

[00:06:45]So, that's the financial side. Now, I want to show you another trust. And this is a government trust. It's a geopolitical trust. And it's a fund trust. And it's a data trust. And it's a debt trust. And it's an analyst trust. Because here we see China's debt in the local government.

[00:07:04]I've spoken about these so many times, local government investment vehicles.

[00:07:09]I've spoken about them because people just have no idea. Ordinary people have no idea what is going to hit them, especially in China. They have no idea.

[00:07:19]Because the information that you're getting is not to be trusted, okay? So, here we have China's debt. It's just the local government debt. I'm not talking about the government debt. I'm not talking about the banks' debt. I'm talking about local government debt. Because what you see on your television is fast trains, massive stations, lots of wide roads.

[00:07:42]They have to be paid for, don't they?

[00:07:48]And how are they paid? They're paid for by local governments raising money from the people, from the banks, from institutions in bonds, local government investment bonds that they issue to build these roads and railways and fast trains. But do they ever pay back?

[00:08:10]No, they can't because they don't produce productivity that creates the wealth or funds flow to pay back, let alone service.

[00:08:20]They can't pay back. So, what is the issue here? Well, people say to me, "Oh, Mike, it's only 3 trillion 3 trillion.

[00:08:27]It's only 5 trillion." Let me tell you, I've got two pieces here which I'll ask Craig to link. So, let's read them. The official local government debt stands near 48 trillion RMB.

[00:08:43]And you think, "Okay."

[00:08:45]But then it says, "Is estimated now to exceed 60 trillion RMB." And you think, "Okay, well, it's 60 trillion, Mike, you know, there's it it's only 10 trillion dollars. Okay.

[00:08:57]Well, let's have a look at the official government official local government debt reached 54.8 trillion. So, now you've got the off-balance sheet and hidden debt at 60 trillion, off-balance sheet hidden.

[00:09:16]Trust. Where's the trust if things are taken off-balance sheet and hidden?

[00:09:20]Where's the trust for the people who are putting the money into these bonds? 60 trillion is hidden, okay? 54 trillion is known.

[00:09:32]So, what's the total? Well, it's 114.8 trillion.

[00:09:39]And that's what's known.

[00:09:41]And what's known to be hidden?

[00:09:44]What is there that's not known to be hidden?

[00:09:48]Could be anything, couldn't it? Could be anything.

[00:09:52]So, constantly over the last 10-15 years, China has used money through local government vehicles to improve their infrastructure.

[00:10:05]But at what cost? And how's it repaid?

[00:10:10]It can't be. So, at some point, the trust in the whole Chinese financial system is going to collapse.

[00:10:21]Because these debts are now being swapped by government in discreet off-market deals.

[00:10:29]Okay?

[00:10:30]Because they know they've got an enormous that is 80% of Chinese GDP is held in debt at local government level. So, it doesn't show on the world statistics, on the BIS, or on the IMF.

[00:10:48]On all those statistics you read in the newspaper, Chinese debt to GDP is 30%, 35%, 40%. Here's 80% here.

[00:11:00]80%.

[00:11:03]So, their real debt to GDP is 115 plus.

[00:11:09]Okay?

[00:11:11]And this has distorted all the numbers because the growth figure you see reflects the amount of money being spent by local governments off-balance sheet financing to make the country and the statistics look better. But where, and I ask this again and again and again, where is the ability to service this debt? And where is the ability to repay this debt?

[00:11:37]Because the roads and the trains and the airports are not producing a cash flow.

[00:11:44]Not a positive cash flow.

[00:11:46]You still got all the servicing costs, the maintenance costs, the staff costs.

[00:11:49]You got all that.

[00:11:50]But what about the debt?

[00:11:53]So, to me, trust in China will at some point implode.

[00:12:01]And all I see from the bots who attack my site, and they are bots, is China's wonderful. China's Yes, there are bots all over China in warehouses full of laptop warriors [snorts] interfering with all social media.

[00:12:19]And then the trust in the news is lost. And I think we're already there in the West, aren't we? We don't trust our politicians. We don't trust our media. So, we don't trust the news we're seeing. So, now you've got no trust in the news, no trust in your governments, no trust in where to hold your gold if you have gold, no trust in dollars, no trust in institutions who are selling you products for your pension, which you need to trust.

[00:12:53]Okay?

[00:12:54]And then you find even the governments you can't trust.

[00:13:00]So, you have to be, and this is what Greg Mannarino said for the five, six years I've followed him, you have to be your own central bank.

[00:13:08]Now, what are the central banks doing?

[00:13:10]They're taking their gold and they're putting it in their vault.

[00:13:15]And I get a lot of comments saying, "You must have your gold in your hands and in your own" Yes, you must, in the end. I don't believe we're anywhere near there yet. However, in the end, yes, you need to hold physical gold, and you need to hold it or silver and you need to hold it in your possession.

[00:13:33]Not in some way that you have to trust.

[00:13:37]Because that trust is broken.

[00:13:40]And you can't sue. How do you sue an institution worth 50 billion dollars for your million dollars of gold? You can't sue them, can you?

[00:13:50]You can't. So there if you haven't got trust you must hold it yourself. Now that's the ultimate.

[00:13:57]We will get there in stages.

[00:13:59]But for now, I just want you to please please please please appreciate this one five-letter word.

[00:14:08]Trust.

[00:14:11]Okay? Because that's what you haven't got in this world and that is why there will be a reset of all systems to try to recover that trust that people need to make everything work.

[00:14:31]Thank you very much.

[00:14:33]Cheers from all of us and Craig me, Mr. Fugly sat here from Join the Dots. Cheers.

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