THAT’S MY RIFF.
ALL RIGHT.
JOINING ME NOW, MY GREAT FRIEND
STEVE FORBES, FORBES MEDIA
CHAIRMAN AND EDITOR-IN-CHIEF AND
AUTHOR OF THE GREAT NEW BOOK
CALLED INFLATION, WHICH I HAVE
READ AND WHICH UNFORTUNATELY IS
PLAYING OUT IN REAL TIME.
HELLO, STEVE FORBES, DO YOU
THINK SOME ADULT WILL GO IN TO
BIDEN GOT TO GET RID OF HIS
STAFF, GET RID OF PROGRESSIVISM,
PUT JOE MANCHIN IN INSTEAD?
>> THE ANSWER IS, HOW ABOUT
PUTTING YOU CHIEF OF STAFF?
LARRY: [LAUGHTER].
MANCHIN WOULD BE PERFECT.
>> YEAH.
LAST SENATOR THAT DID THAT WAS
HOWARD BAKER, REMEMBER BACK IN
THE LATE --
LARRY: FOR REAGAN.
GOOD POINT.
>> BUT NOTHING’S GOING TO REALLY
CHANGE UNTIL THE ELECTIONS.
THAT IS THE ONLY MESSAGE WILL
SINK IN.
ACTUALLY THE WHITE HOUSE IS SUCH
AN BUBBLE MODE RIGHT NOW, THEY
ACTUALLY THINK THEY’RE DOING A
GOOD JOB.
INFLATION IS TRANSITORY.
THE REASON WHY IT IS BAD AS IT
IS BECAUSE WE DIDN’T PASS BIG
SPENDING BILLS, WE DIDN’T PASS
TAX INCREASES,.
LARRY: YES.
>> ON AND ON, THEY HAVE THEIR
EXCUSES.
YOU CAN TELL THEY ARE NOT
CHANGING BY THE PERSONNEL THEY
CONTINUE TO APPOINT AND
REGULATIONS.
YOU MENTIONED SOME OF THEM.
IMAGINE PUTTING ON NEW
REGULATIONS OR REIMPOSING
PRE-TRUMP REGULATIONS ON
INFRASTRUCTURE, WHICH WOULD
STIMULATE THE ECONOMY AND THEIR
THINKING.
YET THEY WILL MAKE IT HARDER.
THEY SAY WE WANT LOWER GAS
PRICES.
NOT ALLOWING DRILLING IS NOT THE
WAY TO INCREASE SUPPLY.
WE’RE DOWN 3 OR
4 MILLION BARRELS A DAY THAN WE
WOULD HAVE HAD IF WE CONTINUED
WITH THE OLD POLICIES?
WOULD THAT MAKE PRICE AS LITTLE
BETTER AT THE PUMP?
LARRY: THAT IS WAY TOO EASY, WAY
TOO SENSIBLE.
WHAT IS AMAZING TO ME, PRESIDENT
ON DOWN, INCLUDING SPOKESPERSON
MADAM PSAKI ABOUT TO LEAVE FOR
GREENER PASTURES, WHATEVER, SHE
IS ALWAYS SAYING ABOUT LEASES,
THERE ARE ALWAYS 9,000 LIESES,
THIS AND TO WHICH BY THE WAY IS
VASTLY INFLATED NUMBER BUT THEY
DON’T UNDERSTAND, THEY DON’T
ACKNOWLEDGE IT IS PERMITS THAT
REALLY MATTER.
YOU CAN HAVE AS MANY LEASES YOU
WANT, BUT IF YOU DON’T GET A
PERMIT TO DRILL OR TO PIPELINE,
TO, I CALL IT INFRASTRUCTURE,
AND THIS GOES FOR BRIDGES, ROADS
TUNNELS, ALSO IRONICALLY WILL GO
FOR WIND TURBINES, THINGS OF
THAT SORT, PERMITS ARE
EVERYTHING.
AND THAT’S WHAT THE INTERIOR
DEPARTMENT WILL BE STOPPING.
THEY WILL WALK AWAY FROM THE
LEASES BUT THE REASON THE LEASES
WEREN’T USED IS BECAUSE OIL
PEOPLE KNOW THEY WILL NEVER GET
A PERMIT.
>> CONTRAST THAT TO THE PRIVATE
SECTOR.
TEXAS, FOR EXAMPLE, IF YOU HAVE
A LEASE, TAKES WHAT, TWO, THREE,
FOUR-DAYS TO GET A PERMIT.
FEDERAL GOVERNMENT, AT BEST
MONTHS.
THAT’S THE CONTRAST.
ONE AREA, YOU’RE GOING TO GET
IT, YOU CAN DO SOMETHING.
FEDERAL GOVERNMENT, THEY WILL
JUST STRANGLE YOU.
YOU PUT IN MONEY, NEVER GOING TO
GET IT BACK AS LONG AS THIS
CROWD IS IN.
LARRY: NOW IT WILL TAKE YEARS,
YEARS AND YEARS AND YEARS
BECAUSE OF THESE NEW NEPA REGS.
STEVE FORBES HAS INFLATION
PEAKED AS SOME WALL STREET
PEOPLE ARE SAYING?
>> PEAKED?
YOU HAVE TO GET IT DOWN TO ZERO
BEFORE PEOPLE FELT RELIEF.
LIKE SAYING YOU’RE IN INTENSE
PAIN.
TOMORROW YOU MAY BE IN A LITTLE
INTENSE PAIN BUT YOU’RE STILL
HURTING.
PRICES ARE STILL GOING UP,
THAT’S THE THING.
BUSINESS MARGINS ARE GETTING
SQUEEZED.
HOMEOWNERS SAY THE OFFICIAL
INFLATION RATE IS DOWN.
WHEN YOU GET THE MORTGAGE RESET
BECAUSE OF YOUR FLOATING
MORTGAGE GOING UP SEVERAL
HUNDRED OR THOUSAND DOLLARS A
MONTH BECAUSE INTEREST RATES
DOUBLED, TELL THEM INFLATION
PEAKED AND YOU SHOULD FEEL
BETTER ABOUT IT.
LARRY: YOU KNOW WHAT?
SO INTERESTING TO ME,
WALL STREET LOVES TO FIND OUT,
LOOK, I’M AN OPTIMIST TOO.
SOMETIMES YOU HAVE TO BE MUCH
MORE REALISTIC.
SO YOU HAVE TWO IMPORTANT
INFLATION RELEASES.
YOU GOT AN 8.3% CPI.
11% PPI.
I MEAN THAT IS A LONG STONE’S
THROW FROM A 2% FED TARGET.
I JUST WANT TO ADD, STEVE, I
DON’T SEE, YOU TELL ME, IS THE
FED PULLING CASH OUT OF THE
ECONOMY?
THEY ARE TAKING EXCESS MONEY OUT
OF THE ECONOMY AT THIS POINT
YET?
>> AS OF LAST THURSDAY, NO.
I WILL SEE WHAT THEIR BALANCE
SHEET IS TODAY BUT THE TELLING
THING IS FIRST REPOS, MEANS THE
FED CREATES MONEY AND BORROWS IT
BACK.
FEBRUARY OF 2021 ZERO.
LAST WEEK, $1.85 TRILLION.
LARRY: ISN’T THAT SOMETHING?
>> THEY’RE STILL CREATING MONEY.
THEY STILL HAVEN’T REALLY TRIED
TO REDUCE IT AND WHOLE WAY OF
FIGHTING INFLATION IN MAYOR MIND
YOU HAVE TO SLOW THE ECONOMY
DOWN.
I WAS READING A ECONOMY IN THE
PAPER TODAY, PEOPLE STAYING HOME
THE ECONOMY HAS MORE ROOM BEFORE
IT OVERHEATS.
WHAT IS THIS OVERHEAT STUFF ALL
ABOUT?
YOU’RE DOING WELL, I’M SWEATING.
TAKE AWAY MY MONEY.
LARRY: GROWTH IS INFLATIONARY,
MAN.
TOO MANY PEOPLE WORKING.
TOO MANY PEOPLE EARNING.
TOO MANY PEOPLE PROSPERING.
ALL OF THAT IS TERRIBLE,
TERRIBLE.
>> THAT IS NONSENSE.
WHAT THEY SHOULD REALIZE
INFLATION MEANS VALUE OF THE
CURRENCY HAS GONE DOWN.
STABLIZE THE CURRENCY, TREAT THE
DOLLAR WITH RESPECT.
BY GOLLY, AMAZING WHAT WILL
HAPPEN WHEN PEOPLE DON’T HAVE TO
WORRY ABOUT THE VALUE OF MONEY
AND CAN FOCUS ON INCREASING
VALUING OF DOING THINGS IN
MARKETPLACE.
LARRY: THEY WILL HAVE TO DRAIN
RESERVES.
NO TWO-WAYS ABOUT IT.
THEY HAVEN’T REALLY STARTED YET.
>> KEY THING, MAKE THE
ANNOUNCEMENT, STABLIZING DOLLAR,
SO THAT PEOPLE KNOW YOU’RE NOT
TRYING TO CASH THE ECONOMY.
WHEN THEY SAY OFF THE LANDING,
MEANS A CRASH LANDING, I HOPE NO
FEDERAL RESERVE GOVERNOR BECOME
AS PILOT BECAUSE I WOULDN’T WANT
TO GO ON THAT PLANE.
ANNOUNCE THAT YOU UNDERSTAND
WHAT INFLATION IS.
THEY DON’T.
LARRY: THEY COULD USE, SOME WE
TALKED ABOUT, BUT WORTH ANOTHER
TALK, THEY COULD USE COMMODITY
INDEXES INCLUDING GOLD TO FIGURE
OUT WHETHER DRAINING ENOUGH
MONEY OR NOT.
NOT THAT HARD.
CLASSICAL PRESCRIPTION WOULD NOT
REQUIRE RECESSION BUT I WILL ASK
YOU THE FINAL WORDS HERE, THE
BEHAVIOR OF THE STOCK MARKET IS
VERY BEARISH RIGHT NOW, STEVE
FORBES, AS YOU KNOW WELL.
I WAS JUST WALKING THROUGH SOME
OF THESE KEY SECTORS
YEAR-TO-DATE, TECH HAS LOST 25%.
THIS IS PRE-INFLATION.
SOXX INDEX, CHIP INDEX IS DOWN
29%.
HOMEBUILDERS ARE DOWN 36%.
RETAILERS ARE DOWN 31%.
CONSUMER DISCRETIONARY DOWN 30%.
TO ME RIGHT NOW, THE MARKET IS
BEGINNING TO FORECAST A
RECESSION.
WHAT DO YOU THINK?
>> IT’S FEAR, UNKNOWN.
THAT THE PEOPLE, THE DOCTORS SO
TO SPEAK ARE STILL GUILTY OF
MALPRACTICE.
THEY HAVEN’T DIAGNOSED WHAT
REALLY AILS THE PATIENT.
THAT IS THE THING ABOUT
INFLATION WE TRIED TO EXPLAIN.
RISING PRICES ARE A SYMPTOM OF
INFLATION.
NOT THE CAUSE.
THE DANGER IS, PEOPLE FEAR, NOT
ONLY GETTING MORE REGULATIONS
BUT PRICE CONTROLS.
DESPERATE POLITICIANS DO
DESPERATE THINGS.
LARRY: WHAT THE PROGRESSIVES
LOVE.
PRICE CONTROLS.
ANTITRUST.
MORE SPENDING.
MORE TAXING.
MORE REGULATING.
MORE CENTRAL PLANNING.
SERIOUSLY, NEWT GINGRICH IS
RIGHT, BIG GOVERNMENT SOCIALISM
THEY DISDAIN FREE ENTERPRISE
CAPITALISM.
>> THIS IS WHERE REPUBLICANS ARE
DOING THESE PEOPLE, I WOULD SAY
SOMETHING WORSE A FAVOR, IF THEY
GOT SPENDING TAXES, OTHER THINGS
YOU WOULD FIND REAL DEPRESSION.
HOW WOULD THAT AFFECT THEIR
ELECTION PROSPECTS?
LARRY: HAS PROGRESSIVISM EVER
SUCCEEDED?
SERIOUS QUESTION, SERIOUS
QUESTION.
>> NO.
THEY ALWAYS HAVE TO PULL BACK.
THEY USED TO CIT SCANDINAVIA.
REMEMBER BERNIE SANDERS?
LARRY: YEAH?
>> HOW DID COMPANIES ORIGINALLY
GET RICH, COUNTRIES LIKE SWEDEN?
THEY MADE WELFARE REFORMS.
STARTED CUTTING TAXES AND GET
SPENDING UNDER CONTROL TO GET
COUNTRY BACK ON THEIR FEET.
SHOULDN’T CALL IT PROGRESSIVE.
IT IS REGRESSIVE.
LARRY: IT IS SOCIALISM.
GINGRICH IS RIGHT.
BIG GOVERNMENT SOCIALISM.
THAT WAS YOUR POINT.
MODERN SOCIALISM MEANS REGULATE
EVERYTHING THROUGH WASHINGTON.
>> THEY DON’T HAVE TO TAKE YOU
OVER.
THEY MAKE YOUR SURVIVAL
DEPENDENT ON THEM.
LARRY: JOE MANCHIN, CHIEF OF
STAFF.
THAT IS WHAT I WANT.
>> PROBABLY LOOKING WHY CHIEF OF
STAFF?
HE PROBABLY WANTS TO APPOINT A
CHIEF OF STAFF.
LARRY: I WOULD LIKE THAT TOO.
SENATOR MANCHIN, HEAR THAT?