Astounding Facts On China and Globalism from Kyle Bass

Jan Jekielek just put up an astounding interview with investment guru Kyle Bass. Here is a sample:

"And then January 23, Xi Jinping closed down all air traffic from Wuhan to the rest of China. But he allowed Wuhan air traffic to travel to the rest of the world. Essentially, Xi Jinping knowingly infected the rest of the world. … “If he’s going to go down, the world is going to go down with him,” essentially what he was saying."

" Think about this: we get 100% of our blood pressure medicine from China. 100%. There are 700,000 people in the United States who take blood pressure medicine every single day. We have a 13-day supply. This is insane. This has to change."

"I’m sure you’ve heard that the Chinese Communist Party decided that anyone that’s to move their supply chains out of China needs a permit to leave. I don’t know if you’ve heard that in the last couple of weeks. But for the last three years, really since the fourth quarter of 2016, when the Chinese completely closed off any kind of external foreign direct investment by rank and file Chinese and even the government—if you remember when they closed the door when they were having a serious currency devaluation problem—companies that do business in China, whether you’re Intel, or Sony, or BMW, or Chevron, those companies haven’t been able to get their dollars out of China, their dollar profits, since the fourth quarter of 2016. I know several of them have hired friends of mine that are former bureaucrats in U.S. administration who have relationships with Wang Qishan, with Xi, with his party, trying to get the money out. They haven’t been able to get the money out for four years, Jan, and now we’re being told that maybe you can’t get your supply chains out."

"I know of a company that I’ll leave unnamed, a very large public company, that has $10 billion in cash on its balance sheet as per its annual filing, and $1.5 billion of that money is in China. They haven’t been able to get it for four years, and I don’t know how they’re ever going to get it out, truthfully. And so, this is what I worry about: our pensions and all of the money that China has figured out how to coerce MSCI and the various index providers, the passive providers, to weigh China so heavily."

"People say, “Well, if we just disengage with China, it’s going to cost us 2-2.5% of GDP. To that I say, “They steal 2% of GDP from us every year in intellectual property, and they earn a return on that. It’s actually a better deal for us to just stop. I know that sounds hyperbolic, but it’s just a fact."

Jekielek asked Bass about the California State Pension fund. I was shocked by the extent to which even our state pension systems were run by foreigners from hostile and unfree regimes. 

"You are opening an entire new can of worms here by bringing up CalPERS. I’m sure you know, their chief investment officer is actually a member of the Chinese Communist Party. He is the deputy director of China’s currency administrator. You don’t get a top five job in China unless you are part of the party elite. He managed the entire currency reserves for the Chinese Communist Party when he worked at SAFE, and now he somehow has weaseled his way in to be the CIO of the largest pension fund in the United States and he is shoveling dollars to China. That itself needs a full-scale investigation. He has already admitted to being part of the Thousand Talents Program, which I’m sure your viewers know what that is. There are about 70,000 members of the Chinese Communist Party that are instructed to infiltrate other economies and steal all intellectual property methods, business methods, and any kind of secrets and report back to the Communist Party. In fact, they have an award every year for the best theft and they give 750,000-1,000,000 dollars and you get a plaque. Ben Meng, the CIO of CalPERS, is a part of the Thousand Talents Program and a member of the Chinese Communist Party. That begs the question to me: who is your fiduciary responsibility to? In theory, if you are a Communist Party member, there is no one higher than Xi Jinping, even whatever God you want to worship. Yet, if you are the CIO of a massive pension fund, you must have a fiduciary responsibility to the teachers of California."

The bottom line is that globalism is deadly both to liberty, prosperity, and our very lives. Both parties have been following the global corporate money and rushing towards this sort of international integration for some time. And for some time, I have been warning of globalism's hidden costs. They are all wrong, and I am right. Not necessarily because I am smarter than them, but just because they are seeing it the way those offering them money want them to see it. There is no other philosophy of government that can stop globalism except its polar opposite, Localism. The others don't even recognize the problem, and therefore cannot provide adequate solutions. In the end, its either going to be Localism or Globalism with a boot stamping down on the face of all of mankind.

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Borrowing 20K Against Your Credit then Giving You Eight Percent of it Back

Not only has the fear generated from the cornonavirus finally given authoritarians the excuse they needed to vastly expand state power, it has provided perfect cover to deflect blame for their gross mismanagement of the economy and wanton looting of the public treasury. They get to blame the virus for a curb in stock market excesses which was long overdue anyway. They are off the hook for a collapse in an economy which had been running on fumes for a long time.

It has also permitted them to launch another spectacularly large heist. They got away with the 2008 bailouts. All they learned from it was that they could get away with gambling big. If they win, they keep the winnings. If they lose, they socialize the costs and we all pay. Why change your behavior if those are the consequences? The cost of any irresponsible over-leveraging will fall on the republic as a whole, not the ones who got greedy. People who are desperate now will lunge for the money, but let's look at the numbers.

A whopping two trillion dollar stimulus bill has already been passed. Another four trillion dollar bill is on deck. That's six trillion dollars. There are probably about three hundred million legal U.S. citizens in the United States. So what the "Stimulus Plan" proposes to do is to borrow about $20,000 against, on average, the credit of every man, woman, and child citizen of the United States. There are five in my household, of whom three are children and I am the only breadwinner. So they plan to borrow $100,000 as my family's share and give it to who?

They propose to give $1,200 of the $20,000 back to the citizens, the people whose credit is being drawn upon. What about the other $18,900? It is mostly going to go back to the same people who got bailed out one way or another in the 2008 and on bailouts. They are, with a loud flourish, giving you a small amount of money with one hand while they are maxing your credit card out with the other!

Some people will do better than that. Some portion of that money will be made available to businesses in the form of a loan, which will become a grant if "most" of it goes to keep making payrolls. That is going to help some of us, at the expense of others. Why does FEDGOV have the right to make that call? In the case of small businesses, the most probably outcome is that the family members on the payroll will be kept, the rest laid off, and the balance of the money will go into the coffers of the business. Let's say the figure that turns it from a "loan" into a "grant" is that 70% goes to payroll. So Wal-Mart can pay the high-salary execs and a skeleton crew to run the stores and pocked 30% of the money. Who wants to tell me why my three small children should have to incur $60,000 of new federal debt so that can happen?

The fact is that in lean times businesses that failed to provide a cushion go under. Other businesses which were more prudent survive those times and expand to meet those needs, or someone else comes along and they get an opportunity to start a new enterprise which fills that need. This is the free market approach, but those running things don't believe in the free market. They believe that those on top should stay on top no matter what. That's why they are borrowing against everyone's credit to benefit the few. In 2008 it was the top one percent of the top one percent. This time it is mostly still them, but in order to avoid a riot they are giving the top 10%-15% a chance for a small cut, and throwing scraps to the rest of us.


This is a terminally corrupt system borrowing against the future to buy it a little more time. The more time it buys in this manner, the worse the pain of the inevitable consequences will be. The sooner we can figure that out the less drawn-out the pain of correction will be. We can start seeking sustainable answers in economics and government, built on justice and equity instead of "do whatever it takes to keep the party going until after the next election".

The temptation to do this will be too great for any politician to resist. The only way to stop the looting is to rebuild with a system so decentralized that the Central government does not have the ability to abuse the credit of the citizens in this fashion. That's localism.

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