Treasury Buybacks In Plain English

SPEAKER_00 0:00

In just a couple of days, the US government is going to do something I would honestly rather, well, maybe even look too closely at it. It's going to start buying back its own debt. With money it prints that same morning, and then it doubles that program and it's going to keep going for two months straight and then probably till eternity. And this is going to happen all the way through until 4th of November, coincidence around midterms, perhaps. But they call it the buyback, which sounds kind of like what a healthy company does, right? When it's flush with cash, but it is not that. Now Wall Street already knows about it. They've got their own name for it. They call it liquidity support or um end-of-year bonus support. It's going to be good for the Ferrari dealers and the and the and the mistress suppliers. But it mostly means it's good for them. And it's something like 95% of normal investors have absolutely no idea about. So let's fix that over the next few minutes. I hope that it's not too windy here and so on, which is why I'm slightly hiding in the shade, uh, because I think this is important.

Gold Quietly Leaves US Vaults

SPEAKER_00 1:03

And mainstream media doesn't seem to be covering it. What they're also not telling you is at the same time, the printer is warming up at home. The gold is leaving, physically leaving out of US vaults onto planes, out of the United States. Gold is now one of the biggest single things America exports. I literally had to check that fact three times, but it's true. Just think about that. The country that prints the world's money is quietly selling its actual gold out of the door or shipping it out of the door. To me, that's one of the most unsettling things I've seen all year, or maybe in the

Japan Sells Treasuries And Spikes Risk

SPEAKER_00 1:40

last couple of years. And on top of that, it isn't just the US that's running the printer. Japan, which has been the biggest loyal buyer of American debt on the planet for decades, you know, the customer who always shows up. Well, they just sold $90 billion of American debt in a single month. The central bank is shrinking its bond pile faster than it ever, ever has in history. And of course, we've talked previously about, if you're watching me before, about the intervention. The US and Japan started together. It's the first time they did that since 1998. So the biggest buyer of American debt is selling. American government is quietly stepping in to buy the debt because nobody else wants it with money that didn't exist before. And what that does to you and your money is really what this video is going to be about.

Who We Are And Why It’s Free

SPEAKER_00 2:30

You're wondering who the heck I'm, my name is Felix Preen. I'm traveling. Uh, I used to be an investment banker, and then I got out, and about seven years ago, we started teaching normal people the stuff that wants to, but honestly, rather keep to themselves. And my mentors have taught about 25,000 people the last seven years. And there's really only one thing I want you to know about me. Um, nobody ever pays me to make these. I take no sponsors, no affiliates, there are no links down there for anything. And I do that on purpose because it means I get a live free life and I can say whatever the heck I want. Uh, I'm also not political. I don't care whether you love the Trump or you loathe the Trump. Really, it's got nothing to do with it. We just want to understand here for the next 20 minutes what it does to your money, what the politicians have decided to do. Because most people only work that out once it already hits their groceries bills and their rent and then all of that, and the fact that their savings are no longer worth what they should be, and the fact that their salary is no longer worth what it should be. And I want to make sure that isn't going to be you. That's really what this is about. So I've also taken the whole boring work and read everything and checked all the dates and all the facts and triple checked them and everything else and put it into a plain English report for you so you can download that. It's completely free, no strings attached. Um, just go to phelixfriends.org slash flood because that's what's happening to money. They're gonna flood the market with money. Grab it, read it alongside the video, or read it afterwards. And I think that alone is gonna put your head up 99% of peep, all right. Links in the description down below. So let me show you why I'm genuinely worried about this, because you've lived to the warm-up, and most people never really named it what it was.

Real Inflation And Dollar Decay

SPEAKER_00 4:02

Um, and I've set this on on record and I'll say it again. Since COVID, in my humble opinion, real world inflation, the honest version, not the official government number of the New York News tells you, it's been well over a hundred percent. That's inflation in my world. Now, if you add up what that's cost you since 2020, you know, all the stuff you're buying, your groceries and all those things, uh, a lot of that is just doubled or more, right? Which is very, very significant. It means your money has lost half its buying power in just five years, or the government's selling you, oh no, it won't be inflationary. It just caused nonsense. And this isn't new, it's just moving faster now. So here's the simple picture. $100 back in 2000 bought you 125 bottles of coke. Today, that same $100 gets you 44 bottles of coke. Crazy, right? Now, I'm not suggesting you should run up and buy Coca-Cola. It is a poisonous substance, but it's a brigad billion stock. I like the company. So you've got the same $100, same Coke. The bottle didn't get more valuable, your money just lost a significant amount of money. And if you zoom about a bit further, you go back to 1971, your money's lost something like 93% of its value. So your dollar of 1971 is worth seven cents today. That's the official government figure. If I compare it to the market, it's about a third of a cent. So a hundred cents became a third of a cent, which is just insane, right? So hold on to that because that's kind of the whole point of what we do while we're talking

Printing Money Becomes A Hidden Tax

SPEAKER_00 5:32

about this. They're about to do something that is basically doubling the money printing. So everything that we felt since COVID, they're lining up to do it again, but they're gonna do it a little harder, a little faster, a little bigger. And if you understand that, I think you can benefit from this because a lot of people got a lot richer since COVID, but most people got a lot poorer. So let's make sure you're on the right side of that. And this isn't a conspiracy theory. The US Treasury has said this out loud. It's a bit quiet the way they do it. They don't sort of massively talk about it because it's a bit embarrassing. But they basically said we're doubling the amount of long-dater debt we're gonna buy back. And we're gonna run it for two months, and of course, then it'll magically stop and then everything will be fine and inflation. But what does it mean? Well, they're buying back long bonds, which just means you go in the market and you take the debt off everyone's hands. And then how do you do that? What got cash do you use it to do that? Well, it comes from where it always comes from. It comes from the magic money printer. You just create it. And on top of that, the Fed's about to meet. And the market was convinced that this new Fed share was going to cut rates, right? Well, if you look at what the market's expecting right now, the bond market isn't really believing. They think rates are actually gonna go up towards 4%. Yeah, two lines is a chart, I'll sort of put it on the screen for you. Um, two lines. Well, they thought at the start of the year versus what they're thinking right now, and they're going in opposite directions. So that's really odd, right? The government's printing money to buy its own debt, which is about the loosest thing you can do in terms of financial policy. And at the same time, the market thinks the Fed's going to increase rates, which is like the opposite, is to how you tighten the market. So those two things don't normally, you know, sit at the same table. It's kind of like if you're driving and you're putting both feet, you know, one on the accelerator, one on the brake, that's pretty much what the government's doing right now, which is just madness. But what really annoys me is that they're basically trying to hide it from you. Um, it's not an announcement. There isn't a great big speech about it. It's just there is a line in a treasury refunding statement, uh, in the most boring language that humans can produce. So you basically go, you know. Um, but really what it is, is if you buy back your own debt as a government, the government becomes a bigger and bigger customer of itself. And then the only reliable buyer left for your IOUs, which is really what debt is, is you. You're not really a healthy borrower anymore, right? You're kind of on life support. And I get it, you've heard about money printing before. The story is usually America prints money, the dollar drops, buy gold, bye bye. Right? But this time, the rest of the world is actually part of the picture. And they are a step ahead. Japan, the most loyal buyer of American debt on the planet, right? In August, it's the latest data we have, Japanese investors, holdings of US dollars drop by 88 billion. That's not a little trim. That is literally them backing out. It's the biggest selling they've ever done of US debt. And I'll put a chart on the screen here for you. So why does it matter? Why does it matter to you and your pension, your retirement? Because 70% of Japan's reserves sit in US debt. So when the biggest foreign holder of your debt starts selling, someone's gonna buy it off them, right? And if they don't, the price of that debt falls. And I know it's confusing, but it means if interest rates go up for everybody, well, it's not just your mortgage that gets hit and your credit card and your car loans and everything else, but also every factory that gets built, every every industrial investment, every bit of infrastructure, everything is financed in the US, and cost of building something depends on the interest rate. So basically, you go into a screeching, horrible, burning recession if your interest rates go up, which is why Trump's so keen for them to come down. So Japanese bond charts matter to you because they don't stay in Japan. For many years, the world borrowed these cheap yen and then they parked that money in US markets, and quite a lot of that was in the stocks that you own, and it's been propping up the US stock market. I mean, Japan is forced to sell its debt, its bonds, its US bond, because they're defending their own currency. The money gets brought back home to Japan, and the cheap fuel that's been holding up the US market, well, it's no longer there. And it shows up as pressure on US interest rates. It shows up in your mortgage, your carbon, as I said before. And so a chart in Tokyo ends up as a number on your portfolio statement. And that's an important thing to understand, how to tie us together.

The Index Fund Diversification Myth

SPEAKER_00 9:57

So most of you watching have your money in one place right now, right? And it's the one place this whole story goes after, unfortunately. But the last 40 years, the safe thing, the gospel has been put your money into an index fund, buy the SP 500, and don't think about it. It's been very, very profitable for Vanguard and many other large uh index fund companies. And the story was that it's diversified, it's America, it always goes up, right? Except pretty much everything I'm showing you today points, well, straight at that idea. Because that index fund that you think is 500 companies, 72% of that, 72% of all your gains this year came from just the top 10 names. And those top 10 names are the most expensive, the most crowded stocks any stock market has ever seen in the history. And they're all AI names. So you actually not diversified in your portfolio. You just have a great big chunk of your money, about 72% of it, riding on the AI wave. And the two calmest, most respected investors alive, the ones who are supposed to love a boring index fund, well, they solpers. Buffett sold us, and the most bullish guys on Wall Street are basically warning exactly about this, and they're edging towards the door. But most retail investors are either panicking and going into cash, which is literally the worst thing you can do. You're guaranteed to lose money. Think about those coke prices I showed you earlier. Um, or they're sitting in an index fund, which is definitely not what they think it is. So, what I'm gonna do, and I get off this lovely little island, um, the Wi-Fi is a little better on Saturday. I'm gonna run for you a free live training. It's the first time we've done it, and it's called the index fund trap. It's literally why the SP 500 is lying to you. We're gonna do it live. There'll be a real QA, you can ask me anything, and I'll show you how to check your concentration. I'll show you what the skilled money is doing instead. Because that's what Wall Street is. They're not smarter than you, they're not smart money. It's a that's what they'd like you to think, but they're just skilled. They've been taught this. It's completely free, no strings attached. Um, all you're gonna do is show up for yourself. And I'll put a link in the description down below. I think it's indexfundtrap.com or something like that. Anyway, there's a link down below in the description. Click on that, grab yourself a seat, and then come back here and write thrive in the comments because that's really what I want you guys to do. I want you to thrive from this situation because I tell you the wealthy are gonna make money from this money pranking. But most people will suffer from it. I want to make sure you're on the right side of that, because you know, one's gonna be fun, one's gonna be painful. So let's make the whole mechanism here really, really simple. Um, because they're counting on you to find it so boring, you won't read it. The government spends far more than it takes in, right? So they issue debt, IOUs. Step two is normally the world buys those IOUs, but we've just watched the world's most loyal buyer, Japan, selling there. So there's a gap here. There's more debt than they're willing buyers. So step first comes in. And that's rather than let the interest rates go higher to bring in more buyers, that's normally what a free market would do, right? You just have to pay more interest to attract more people, um, but it would blow up the government's budget even more. So what do they do? The printer fills the gap. New money is created to buy the debt that nobody else wants. And that's what they call a buyback, which of course is a is a crime against the English language. And the speed of that is doubling. So every union dollar that gets created, what does it, where does it come from? Well, it doesn't create dollars on its own. It comes out of the dollars that you already hold. And nobody tells you that. Your balance won't move, the number in your account is the same, but it's just worthless. It just buys less. And that's the trick. It is a tax that you never voted for, you've never seen a printed statement, it's just a hidden tax. And on top of the government's borrowing, you've got this AI built out, right?

AI Debt Collides With Treasury Flood

SPEAKER_00 13:49

The big tech names are about to borrow something like a trillion dollars to build data centers next year. They're doing about 700 billion this year, and next year is going to be a trillion dollars. And that is an ocean of new corporate debt hitting the market at the exact same time the government is flooding the same market with its own debt. So more paper, more paper, more paper, all chasing the same debt bias, who are already going, no, no, no, we're we got enough. We don't need any more. And therefore, the printer is gonna have to print a little faster. So just picture the scale of that. A trillion plus debt of corporate borrowing on top of the government borrowing, you know, two trillion plus. So every single one of those bonds, everything on one of those bond dollars needs a buyer. And the buyer pool is actually shrinking, not growing, because of countries like Japan pulling back. So the only thing big enough to circle up is the money printer. So the AI boom that everyone's celebrating and the money printing everyone's ignoring are not two stories. They're literally one story. The build out is being financed by the same money printer that's eating your savings. So you're paying for the data print, uh, the data printer. Yeah, you're paying for the data centers, uh, if I can get a straight sentence out, right? And that's the point where I go and look at what people with the real access are actually doing rather than what they're saying, because you know, talk is cheap, but disclosure forms are a legal reality.

What Politicians Buy Versus Say

SPEAKER_00 15:15

So in the in the Winston app, which is something that I built for myself and I share with you guys, we can pull this stuff up and I can see what the politicians are actually doing. The president has just filed a huge batch of 600 trades. And what's he doing? He's leaning into boring stocks. Berkshire, Visa, MasterCard, Home Deck Depot, right? Even a literally a rubbish company. Republic services. They collect your garbage. Why? Because these companies, you're not gonna stop producing garbage, are you? I mean, you know, your household's gonna create a certain amount of rubbish and it's gonna have to get collected. You're gonna have to pay for that. So that's where he's moving. And he's moving out of the AI stocks. Isn't that kind of crazy? Uh so you want to see that, you want to watch that, you get alerts for what those guys are doing, and you know, Pelosi and all the other lunatics. Um, there's a link down below, it's a free trial. If you want to check that out, don't have to cancel it if you don't like it. But the people closest to information are not betting on cash holding value. They're not betting on the SP holding value. Okay, and let's get to the bit that I actually really wanted

Physical Gold And The 1971 Echo

SPEAKER_00 16:17

to cover here. Forget about what anybody says about gold for a minute. Watch what they do with it. And what they're doing is pulling their physical gold home. The Netherlands moved theirs home, France, Germany, my um, you know, fatherland. Uh, one country after another is bringing their metal back, wanting it in their own vaults, on their own soil, close up to where they can control it. And that's an expensive thing to do. Either you've got to fly back all the gold or you gotta sell it, you've got to buy it, you're gonna you're gonna pay a margin to the lunatics on the gold exchanges. And the president gets it. He literally posted on his ex account the golden rule, he who has the gold makes the rules. And gold is literally one of the biggest things America exports. Physical gold at record levels. Used to be a few percent of US exports, so now a serious size slice of it. Again, to put that chart on the screen, I hope. Um crazy stuff. So the country that prints the world's money is shipping its gold out the door at a record pace. Gold is the one form of money that you can't print, you can't fake, you can't, you know, double it through till midterms. Um, and it reminds me of, because I'm someone who watches patents, that's really all I do. I've seen this film before. It happened in 1971. The US quietly slammed the gold window shut, it cut the dollars, last link to gold, because too many countries were turning up wanting to get their gold out of the US. And of course, that was a temporary thing, right? It's been 55 years. It's a bit like the next two months of money printing will also be temporary. I think in 55 years we'd still be printing money. So we have the same pressure then as now. Too much paper money chasing not enough real money, and a government that would rather change the rules than change its spending because that'll be unpopular. And every single time this has happened in history, no exceptions. The people holding the paper got poorer, the people holding the real thing, well, they got protected. So I'm not trying to be dramatic. I'm not trying to, you know, tell you put all your money into gold. I'm not a financial advisor, uh, and I definitely wouldn't put all my money into one asset class. Uh, but you remember that Coke chart, right? 125 bottles you could buy, and now you just buy 44 bottles. That's the other half of it. Every bit of value the dollar lost in those years, gold actually kept it. Good stocks also kept them, right? And we'll talk a little bit more about what good stocks are if you join me on Saturday and how we can find those and so on. So this is a binary event. The skilled people get richer, it's kind of a guarantee, and the non-skilled people get poorer, which is definitely a guarantee. So my goal is never to scare you. I want to leave you here, not sitting in the dark, going, oh my God. But um, while I'm not a financial advisor, and why Winston is not traveling with me, so you know, you gotta be better for what I'm about

Don’t Panic, Own Pricing Power

SPEAKER_00 18:57

to say. We better fact-check it. Uh, Winston's my adopted golden retriever, if you didn't know, he does all the hard thinking usually around here. Um, what I learned from my Wall Street mentors, what they drill in into me is you gotta make your own call. First thing, don't panic, dump your US stocks. This gets misread all the time, right? The world's backing away from the dollar, so sell everything American. No, no, no, no, no. Foreigners own a record amount of US stocks, right? Crazy amount. The world isn't abandoning America. It is rebalancing up the edges slowly. Panic selling is like, it's a really bad idea. So what you actually do is you own things that can't be printed. You own businesses with real pricing power, like the tour booths, like what the uh, you know, El Presidente is buying. Um, the companies that can put up their prices when everything gets more expensive. Coca-Cola, yeah, you can probably put up their prices. People are addicted to that sugary stuff, right? Um, and yes, I personally believe a sensible slice of gold um can be a good thing to do. And again, never do that because some guy on YouTube tells you about it. You gotta come to your own conclusions on that. So but the point is not to bet the farm on a crash. The point is to not be the person holding the thing that's quietly melting and calling it safe, which is cash. Um we talk about the SP in a bit more detail on the weekend. If you join me, links down below. So let's bring the whole thing um home and then I'm gonna run for

Final Warning And Saturday Invite

SPEAKER_00 20:15

breakfast. Uh, the government printing to buy its own debt is just it's a Ponzi scale. The most loyal buyer of that debt is selling. Gold is literally being flown out of the United States at a record speed that we've never seen. And they all point in the same uncomfortable direction that if you just put your money into an index fund, which is a safe thing to do, and I'm not saying you should sell your index fund, please. If you're not invested, an index fund is a million times better than not being an index fund. But you need to understand what you actually own. 72% of your gains all year have come from just the top 10 companies, and they are all AI companies. So you need to understand your risk exposure to what's going on right now. And I think for most people, it's probably higher than they'd like it to be. So the government is here trying to like keep this thing floating. Um, and it's important to understand that I'm not trying to be a doom guy here. I don't know if next month or next year the markets crash or any of that. But what history is telling tells me is that risk is getting significantly higher. And I think most people have no idea the amount of risk they're presently sitting in. And that's really what Saturday is for. So join me on that free life training, the index fund trap, and why the SP 500 is lying to you, it'd be life, it'd be real. Uh, you can ask me QA, you know, questions, I'll provide the answers, I hope. Um, completely free. Show up for yourself to actually come out of this thriving. Because I can tell you the skilled money is gonna come out of this thriving. There'll be more uh Lamborghinis and Bugattis and the you know the mansions and the Hamptons and so on. Because if you understand this, I think you will make better decisions. And that's really the the whole the whole premise of this this community here. So click on the link in the description. If you got some value out of this, share it with somebody else. And I hope to see you on Saturday. Wish you all the best.