The K-Shaped Decade with Matt Borka

“Why does life feel poorer when the economy looks rich?” That question drives our talk with Hungarian-born creator and entrepreneur Matt Borka, who has lived and worked across the West, Eastern Europe, and Asia and who tracks real-world conditions through labor data, incentives, and what he sees inside marketing and online business. We start with the growing sense of Western decline and quickly land on a hard-to-ignore pattern: a K-shaped economy where the top captures upside while everyone else absorbs risk, stress, and stagnation.

We unpack what wage stagnation looks like up close, why inflation in necessities breaks the old promise of “low prices,” and how AI is changing work in ways that are both impressive and brutal. Matt shares concrete examples of AI automation replacing entry-level and support roles first, even when productivity gains are uneven across the economy. That connects to Peter Turchin’s idea of elite overproduction: too many qualified, ambitious people competing for too few stable professional paths, now intensified by rapid technological change.

From there we dig into platform monopolies and platform lock-in. When TikTok, YouTube, Instagram, and Meta act as the primary routes to customers, small business owners face rising ad costs, declining product experience, and almost no accountability. We also zoom out to institutional decay, collapsing social trust, brain drain and expat trends, and geopolitical instability that makes long-term planning feel impossible, including why gold markets and hedging behavior signal deeper uncertainty.

If you care about the labor market, AI job displacement, inequality, platform power, and what comes after the “rules-based order” stops feeling real, you’ll get a clear map of the pressures shaping the 2020s. Subscribe, share this with a friend who keeps saying “something feels off,” and leave a review with your take: what trend worries you most right now?

 You can find him  @matt_borka on YouTube and https://www.mattborka.com/

Musis by Bitterlake, Used with Permission, all rights to Bitterlake

Transcript

Meeting Matt Borka And The Premise

C. Derick Varn 0:48

Hello, I'm here at Matt Borka. Hungarian born content creator, entrepreneur, which sometimes a swear word on this podcast, I'm not gonna lie. But uh a little bit depends on what you're entrepreneuring. And content creator is also a word that I've always found interesting because it's usually it's like expert, it's pretty vague. But you have similar passions to me. You talk a lot about stats from the Bureau of Labor Statistics, you've incorporated peer-reviewed research from Peter Turchin and whatnot into your work. So you're affected by work from fields like Cleo Dynamics, which you're I checked out yours versus some of the other people who claim to be doing clear dynamics and that one Professor Yang guy who was like talking about it in regards to the Antichrist. You're not doing that. No, I'm not. Um and one of the things I wanted to talk to you about, because you've spent time here in the West, uh, you spent time in Eastern Europe, and you've spent time in Asia, and I have spent time in the West, North Africa, and Asia. And one thing I think for those of us who can do cultural comparisons and are older than say 25, I think we have to admit that there has been something that feels like severe cultural and economic decline in the West in general. The economic decline can seem massed by stats that look superficially good. GDP growth can spike and go up and down. Stocks seem to be completely non-respondive to almost anything. But if you look at most of American life today, institutions seem fragile, everything seems underfunded, we're given to kinds of shocks of even production that we were not given to before. Things have not recovered as well as they might have seen post-COVID. And you know, I haven't been to Europe since since COVID, but I it from what I can read, it seems like it's similar, if not a little bit worse, there. So I wanted to ask you what do you think is driving the sense of decline? And we'll kind of go from there.

COVID And The K-Shaped Economy

SPEAKER_02 3:25

Yeah, well, I think I mean, obviously, there's been a lot of changes all over the world, right? Ever since COVID and with new technology like AI. And quite frankly, I think specifically in the 2020s, I think COVID triggers something that it's it's kind of difficult to come back from it, right? And with as you mentioned as well, fragile institutions and all that, unfortunately, that created a scenario where essentially we have so-called a K-shaped economy, right? Because all the funding that was given out of people that essentially went upward, right? Because people spend the money. So I think that accelerated the process. Plus, like on the ground, I think the fact that the legal institutions are not really protecting the average worker in America. In actually, I just talked to a friend today, and and she thought, no, it's not only the states, that also applies to the UK, right? And we could maybe assume that sure, maybe they have better labor protection laws, but people can be laid off at any time there as well. So I think overall, the fact that there's been tons of money funneled upward, and there's no way for the average person to achieve upward mobility, I think that creates a scenario where you know the people at the top benefit from all the technological improvements, and it feels like the average person is essentially cast out of all the wealth that the new technology is creating.

Wage Stagnation Inside White-Collar Work

C. Derick Varn 5:37

Yeah, I I've been I was talking to someone friend of mine today, and we were talking about like cultural creation. I was like, and it reflects this K-shaped economy in a way, and that if you look at like the the demographics that stuff is being aimed to, it's either very low money consumers are the wealthy. Anecdotally, but it's I travel a lot for various reasons, and I've been going to a lot of like train stations out here in the West, in the American West, and noticing that like even at train stations, eateries that were specifically aimed at middle class people, those sorts of they're just gone. Like they're being replaced either by high-end restaurants or by stuff that's very, very cheap. And uh I find that interesting considering we've built an economy that was based on a bunch of assumptions of middle-tier, mostly white-collar labor. Like, and what I think is very frustrating is like you bring up COVID and the situation with COVID. For me, that rapidly accelerated to something we've probably seen since the Great Recession, which is this increasingly bifurcated economy. But in COVID, it particularly accelerated, right? And it seemed like even like when you said, like you give people, you give general people money, what does it do? Well, they have to spend it immediately, it gets captured. You don't give it to them, you try to pull it back by interest where you have to pay the interest out that goes to the same rich people too. Like it seems like no matter what you do, the primary beneficiaries are the top, say, two or three percent of the of the economy. I find that structurally interesting, and I wanted to ask you about what structurally seems to have made that the case at ways that it was not true for, say, most of the 20th century.

SPEAKER_02 7:32

So, what I'm seeing overall, and this is kind of like boots on the ground information, that and I'm talking specific specifically about the the industry I know better, which is like marketing and and and and that world. Everyone feels stuck, like really stuck. I mean, if you're working for a business, like how do you get ahead? You're literally getting paid the exact same amount. Okay, and people have to manage, so I have a background in media buying, so I manage like Facebook ads, and we have to manage more money over time, and we're getting paid the exact same amount, and that hasn't changed since I say 2018. And again, if you think about it, prices are going up, people need to work more. These people would have to take on second jobs because the first job is not enough and there's more stress. There's no bonuses or anything, you just do more, you have to do more for the same amount of money, and that creates frustration, like a lot of frustration. And again, this is only one industry and one specific type of role, right? And we haven't even talked about, you know, like like what about other people? What about other industries? And I would assume that there might be some similarities. Like there's no upward mobility at the company, there's fear that people are going to get fired, and and and I think that creates a scenario where people are concerned about the future, but not only that, the the wealth that is being created by these people, right? Because essentially with media buying, you're you're in the weeds and you're helping with the operations of the business. That's how kind of the role uh evolved over the years. Those people are making tons of money for these businesses, but they're not getting like even in the form of a bonus anything out of all the wealth they're creating. And that creates and again, like this is only like one role, but that's essentially what I'm seeing that essentially people are being denied like all the money that they enabled these businesses to to accumulate, and they're not they're not getting a fair share out of that chunk of money. And I think that, and then obviously because business owners have more money now, right, they they're gonna spend it. And they're like, well, I want to spend more, right? And that creates, I think, the other end, like the upper end of the K, right? And it fuels luxury spending and all that. And I think that's basically what we're looking at, where like on one end, the wealthy love spending their money, and they love it so much that they don't they don't want to even consider people consider giving people just just a tiny amount, right? Like just give these people a bit of a raise, just give them a performance bonus, whatever you think would work best. And I think that's and I think for the average American, they see it, right? Like they see how much money these companies are making, and they're not getting a fair share.

AI Productivity Gains And Lost Junior Jobs

C. Derick Varn 11:15

Yeah. I mean, not only are they not getting a fair share, they're also no longer getting the dividends paid active in terms of like prices either. Because in again, the aughts, for example, if you were to talk about uh low-paying businesses, some of some libertarian would pop up and say, Oh, but you know, you're getting low prices for this, so ultimately it's actually probably a wash. And that's not true anymore either. Like inflation is quite high. Inflation on things that everybody needs. I mean, you know, healthcare and housing inflation have been longstanding, but now like food and clothing inflation are actually beyond you know the gener the the the aggregate index. Like, and even when it goes back to the say normal two to three percent a year, which it was what it's been for you know the past 40 years when we haven't had spikes, it's starting from such a high place that that still hits when you also factor in frozen wages and now anemic job growth. I think one of the things that I wanted to ask you about, because AI is interesting to me. It it is very good at some things, it's not very good at others, but it affects jobs in industries where it hasn't even been shown to be particularly, let's see, productivity efficacious, so it's not necessarily generating a whole lot of additional productivity, but it is enabling layoffs in those areas, and then there are areas where it does allow for real productivity. I know uh there's some people who deny this, but I I I've seen it anything that it involves text, a whole lot of managerial managerial work, coding.

SPEAKER_02 13:07

And I can give you a very specific example here. So this happened with like like real talk. This happened this week. Okay. So I've been using Claude a lot. Claude is my my favorite model, and I've been using so for Facebook ads, there's something called MCP, custom mcps available, right? So essentially what it does, it's it communicates with the meta platform. So it sends data from meta to cloud, right? And with this thingy, this piece of software, it enables me to build campaigns very quickly, very quickly. It's completely accurate. So what happened with one of the partnerships I have is we're not gonna have to hire a junior media buyer to help me because AI is doing that for me. And in terms of quality control, like there's I don't really have to check it that much because it it gets it done. I have to give it code and then it gets it done. And this way, just by myself, I'll be able to manage up to 30 ad accounts. And five years ago, that was not the case. Like I would have been overwhelmed, burnt out if I had to do five ad accounts because I would have had to uh create writes at copy from scratch. I would have had to communicate with clients significantly more, so it would have been more time consuming on the communication side. So overall, there's massive productivity gains here in terms of what I do for work. And then another thing that happened, we automated reporting as well, which would have been done by a data scientist before. And usually data scientists are getting paid even better than media buyers. So we're not gonna need that person anymore because again, with Claude, I can do that by myself because I know what has to happen with the reporting. So essentially, we this week only we automated away two full-time positions.

C. Derick Varn 15:30

It is interesting. I work in education and we are highly polarized about AI, obviously, because we can no longer gauge uh that well what our students are doing, and the cognitive effects of AI use are unclear, but the emerging research is not super exciting. But also on my end, I'm gonna be quite frank with you. I have just been able to do my job because of AI, because otherwise it would be overwhelming. Like we have increased student loads in what I do up to 400 kids. And without some AI, and no, I don't have the AI grade the kids because it's not graded that yet. But it does handle my workflow, it helps get certain things done, it helps me generate feedback informs, like the amount of paperwork and federal compliance paperwork that used to take me hours a week that now takes me about 30 minutes. Wow, you know, is it's kind of amazing. It's wrote, it's work that I don't think humans should be doing anyway, but eventually it'll cost jobs, even in our field. Yes. And I think what they're I think that's why there's such a big push from it from administration. Although I think if people think it's gonna cost teacher jobs, teacher jobs are already pretty lean. I actually think it's gonna start costing administrative jobs because that's where our bloat is. And AI is actually better at that.

SPEAKER_02 17:02

So one thing I'm definitely seeing is that highly experienced senior people, right? They tap into AI, and essentially, and uh the data backs this up. It's actually the junior jobs that are going away, right? Because you don't need that at um junior person to help you out anymore, because essentially you just have someone helping you with like all the stuff that you know, all the not low-level stuff, right? Like admin work or for me, ad creation, things that would would have taken me a long time to do, like like time-consuming things, right? And that way you can focus on reading the kids, you know, curriculum, right? In my case, uh operations, strategy for the business, like the the broader perspective, right? Like what are we looking at? So, but then okay, that's cool, but then young people need to work as well, right? So, what does that look like? And it's extremely difficult to tell right now because I'm confident that I'm not going to need a junior media buyer but by the end of the year, like for sure. I don't know another person because I'll be able to do everything by myself. But then AI is going to develop and progress and and improve by the end of the year. So, what does that look like exactly? So, does that mean that maybe by the end of the year it's going to get even better? And then I'm not going to need someone to help me for another year.

unknown 18:53

Yeah.

SPEAKER_02 18:54

I think that's what makes it really difficult to kind of predict like what's going on because the improvements and and are so rapid that it's very difficult for the job market to adopt and understand what's going on.

Elite Overproduction Meets AI

C. Derick Varn 19:12

Yeah, I mean, I I think that you are absolutely right about that. And I think it's interesting to think about particularly when you have a highly educated population. Now, it is true that like students graduate from high school right now are going to college less, but that doesn't mean that all the past graduates aren't still in the economy, and a lot of them still don't have work if they've graduated in the last two or three years. Which brings me to Peter Turchin a little bit, and then maybe we can you know pivot to more very contemporary things. But like Peter Turchin's thesis, one that I actually do put a little bit of stock in, is that most societies today have overproduced, let's say potential elites, because they're not actually elites, and I think this is a misunderstanding of Churchin. You've overproduced people who are qualified and skilled enough to work in upper middle elite positions. And there was already a lack of need for all those people for the last 20 years that like neoliberalism made a promise about like the American worker basically being the manager for the world that was already not really happening at scale, even before COVID. But post-COVID, for a variety of reasons, it seems like AI rolls out. We look like we might have a labor problem where we have a strong market for labor, and AI evaporates it almost immediately. Now, on one hand, that makes economic sense in some way. We know, for example, that we were going to lose a whole lot of the workforce. I mean, a whole lot of the workforce left after COVID because they just got old. I mean, the baby boomers are now almost all out of working years and they held off retirement, but you can only not retire for so long, and also you just die. So, on the other hand, it seems like we have no long-term vibe like view of what to do about this. Like any kind of you know, mitigation like UBI or something that people like Elon Musk might bring up is so far politically down the line that it's going to be generations before that seems to happen, at least without some major external shocks. I I've been wondering about this too, because I've been thinking about this. Okay, so right now, if I'm me, I feel pretty secure in my job, but I do not feel secure about anyone underneath me. But I also go, okay, what happens to everything when I'm gone? Because at least now, maybe the AI will eventually be able to do all of it, in which case we have a whole different problem. But at least right now, AI has got the ability to help aid and remove these entry-level, semi-skilled and skilled jobs. But then as senior partners leave or age out or get fragile, who's gonna be there to replace them? It that's not obvious right now. Uh yeah. Um, so I was gonna ask you like, what do you make of Peter Sturchin's the thesis about the overproduction of leads and how has AI affected that? Because that doesn't factor into any of his books priorly.

SPEAKER_02 22:28

Yeah, so yeah, this is going to get really interesting because like what I'm seeing on my end is that a part of what media buyers do, like there's if we really want to simplify it, right? Like we work with local businesses, e commerce businesses, and information product. Businesses, which could be anything from an education program to coaches, and specifically in the coaching circles, right? Like it's very obvious because it's very personal brand heavy that all of a sudden everyone can coach you on anything, right? Like fitness or business, how to start a business, how to start a specific business, Amazon FBA, drop shipping, whatever, right? And then what happens is that if you have a look at some of these people who who claim that they made tons of money, in a lot of cases, it's not even true, right? They're just saying they made that much. But also, there's like this weird competition, which is really based on money and how much you made, right? So, in order to show your value, so to get your elite position, you have to be a seven-figure entrepreneur, an eight-figure entrepreneur, right? A nine-figure entrepreneur. And then you go to to the masterminds where you pay tons of money to be in those circles. So essentially, you say, Well, in order to maintain my position, I have to have I have to spend tons of money here. Okay. So that is basically, I think, what like what causes some of the wage stagnation. Because in order to maintain these elite positions, these people gotta have more money on hand to maintain those positions. But then what happened with AI it all of a sudden commoditized information. And I know that coaching is not the entire US economy, right? But essentially you can go online and with a bit of prompting, you can literally teach yourself a lot of things. So, or learn how to carry out a service. So, to your point about uh America being the manager of the world, so okay, so what happens now? Because the cost of management is going to go down because the information is going to be available. So it creates like this weird dynamic that, okay, so they had the positions, these people maintain these positions before. But I think, and I'm hoping, this is just a hope, that AI is going to somehow kickstart some type of upward mobility because the information is not being withheld anymore, right? So if some of the people out there who really want to start businesses are going to start creating those businesses, and those businesses will have a very different work culture where, okay, I'm actually willing to pay you because I know what it was like for me, right? Like this is a hope, but I do see that with some of the people I'm working with, there's a desire to really do things differently. And I'm hoping it's going these people are going to get ahead and they're going to make content about it, and they're going to talk about this. And hopefully, this is going to help.

C. Derick Varn 26:28

Does democratize the ability to get into certain services? Its role in education is a little bit iffier to me at this moment, but it it was going to change it dramatically. And we have had increasingly cartelized portions of the economy, particularly higher ed, which is very cartelized, very, I mean, it's it's a semi-medieval institution that serves a capitalist function, but like part of its whole drive is this exclusivity. If you remove the exclusivity, then its social power starts to wane somewhat dramatically. I I do feel like that could be in some ways even good. The problem, though, that I I see ties into AI, though, is they're platform locked, and platform locking is increasingly a huge part of our economy, and that's a monopolistic tendency that favors people who already have money and power. How does that? I mean, like on one hand, I could see people who would not have had the capacity using something like Claude to learn enough to actually even build another platform. But the other problem is though there's only like four major model platforms that currently exist. So it's it does seem to have a lot of these same problems that we have with internet platforms in general. Like, you know, I work in content creation YouTube. If YouTube gets pissed at me for whatever reason, and I'm not even monetized on YouTube, like I'm not making money from YouTube directly. But my my indirect way of making money from YouTube, which is my Patreon, would still be driven to the floor if YouTube just kicks me off for whatever reason, and they can't. I mean, like, there's not that much accountability for it at all. And I think people are beginning to notice how much power these platforms have as to like who can even do you know businesses now. And I'm wondering for you, do you think that's driving some of the desperation it seems like we we're getting from young people because they're realizing how that even their way of building a small business, which is like TikTok or Instagram or YouTube, and I'm not just talking about small businesses that do like what we do, I'm talking about like someone who produces a small physical commodity, the still the way they're gonna most likely get it out to the public today, is on social media, and and if you don't if you get blocked or all the shenanigans with TikTok in the last two years, I mean that just makes it obvious, it becomes very hard to even do small entrepreneurial ventures.

Platform Lock-In And Ad Monopolies

SPEAKER_02 29:26

And I have real data here for you, okay, and why this is so dangerous. So, with one of my partnerships, it's a car agency, right? We work with all types of dealerships in the United States. And when we're posting content, the same content, right, the exact same video, more often than not, TikTok performs better. And we're talking about the exact same video, right? So for a lot of businesses out there, if TikTok goes away, or if there's a legal issue with TikTok, like for a lot, a lot of content creators out there and personal brands, we've seen better results with TikTok, significantly better results in terms of organic, meaning when they when they just post and there's no dollars, ad dollars backing it up. It's a different story when it comes to advertising. But the problem is there's only what YouTube, right? TikTok, Instagram, yeah, and specifically with advertising. So if you're if you're very brave and and you really want to scale and you're willing to put money behind it, you spend money on these platforms. But then I just I literally just did a video about it, but it's not out yet. You know, Meta is looking to build data centers, right? So they're increasing CPMs cost per a thousand impressions, which is basically how we get charged when we're spending money on the platform. And they're inflating at cost in order for them to so basically we're paying for all those data centers. And the the platform is not, this is not inflation. This is not, they're just saying, you know what, you're gonna pay more this year as well. But this year, we're gonna increase at cost even more because we have like we got bills to pay and we we want to do all these extra things here, and the platform is not getting better, right? I feel the at product has been stagnating. So tie it back to small business owners. If you have a limited amount of budget, right, and let's say you have a few thousand dollars that you're willing to spend on on this venture that you have. I feel the platform is not really doing a good job right now with small business owners who are starting out, and the the cost is increasing, and you cannot really go anywhere else because these big platforms have monopolistic tendencies. And whenever someone is doing something semi-good, right, they just go and acquire that business. So essentially they take out competition and then they can increase cost per a thousand impressions however much they want, because you cannot go anywhere else.

C. Derick Varn 32:28

What I find interesting, and maybe this will be a way to tie this into politics a little bit, but we have to admit that most of these big tech platforms were built by a mixture of venture capital and government contracts insulating these producers from competition. TikTok actually is the exception, but Meta got huge through a variety of ways. Amazon got huge mainly through AWS and its and leveraging venture capital. Elon Musk ventures almost all directly come from government investment. I have been somewhat taken aback because under the under the Trump administration, it seems like the tendency for these companies has been to, and it makes sense from a certain brutal but short-sighted capitalist standpoint, to now kick the ladder from the very government investment and stuff that they got and were able to get these contracts from. The reason why I think it's short-sighted is just these companies are they seem to be stagnating in their own way. Meta most meta products have not improved in a long time. No, not for any end of that like casinos.

SPEAKER_02 34:00

Like that's it's so within the app platform itself, and I'm not sure if I can, I'm not gonna share my screen. It feels like you're in Vegas, and it's some type of casino. Like it's or sorry, let me let me rephrase maybe like a really crappy app that like a freemium app or something. There's things popping up, they're trying to push you to do things their way, and they're hiding features from you. So it looks like you're doing things one way, but in in reality, they're hide, they're hiding the settings. And it's extremely annoying. They started doing this like uh, I don't know, the past three years, maybe. And it's really annoying, right? Because you would think, well, they want to provide a great experience for the two parties involved. One being the end user, two being the advertiser, right? But I quite frankly, I feel like both experiences have been declining, and we cannot go anywhere else. So it's in the their meta was saying, Oh, they don't have a monopoly. 100% they do. Not when it comes to the actual social media platform, but when it comes to the advertising platform, they 100% have a monopoly, and and they don't want to admit it. Well, obviously they're not gonna admit it, but like they're aware that you cannot go anywhere else if you're an e-commerce brand starting out, if you're a specific type of local business, right? And I think that's what makes them well, not dangerous, but you know, it's a monopoly, right? And that's not cool in a country where you we're supposed to have, you know, free market economy, capitalism, that sort of thing.

C. Derick Varn 35:56

I was been thinking a lot about the this whole monopoly tendency because it's definitely something we see in the in the tech format. And it does seem to put us at a major it's it put us at a couple of disadvantages. Are you familiar with the with the work of Nicholas Tayyib Taleb? No. Okay, well, he writes a lot about this. It was bigger 10 years ago. He writes a lot about fragility and fragile systems, and one of the things that you see right now is like the stock market is now a hyper fragile system because all growth is really tied directly into basically whether NVIDIA makes a profit. And that's kind of amazing. We have seen this before in America, but the last time we saw it anywhere like this was the big monopolies during the 60s into the early 70s around you know, produ around commodity production, General Electric, uh, General Motors, and and the telephone. And today it seems like it's not even that diversified, and it seems hyper fragile in that it does seem to go up no matter what, but also if NVIDIA actually has a major problem, you'd have a loss of value in the stock market that was epic very quickly. Because a lot of things downstream from NVIDIA, I mean, we talk about AI. I mean, it is true that a lot of the AI companies themselves, particularly OpenAI, aren't technically profitable.

unknown 37:40

Yeah.

C. Derick Varn 37:41

And it just makes you wonder like, are we sitting on a bomb? Or you know, I mean, that we talk about a bubble, but this would actually be kind of more than that. And the the other thing that it leads me to think about is like all of our priors for how a bubble burst uh right now tends to be based off the housing market crisis in 2005 to 2008. And I don't think that's a good model for what any of this would do if you have a serious problem.

SPEAKER_02 38:11

So here's what I see, right? So, as we if we want to tie it back to elite overproduction, right? There's way too much money, even on a smaller level, right, taken out of businesses that should have gone toward wage growth, new positions, right? And it's being spent on lifestyle and stock it, like obviously like investing as well, right? And the problem is all that money, right, is being funneled into the stock market, or a portion of it, right? Whereas in reality, that should have gone toward growing those businesses, and there would have been a need because here's one thing that that's very true about the American economy. People have all I think American people are extremely talented because otherwise, like how how do you prop all this up? Right? Like, someone has to maintain the system. However, people are not getting paid enough now, and that the money is going to into these overvalued stocks. And I do agree that it's a bomb because I mean that's how you create a bomb, right? The the money that should have gone toward other things. It's it's being it's being spent unwisely, and it creates tons of risks, not only for the average person, but investors as well, right? The stocks are overvalued.

C. Derick Varn 39:43

I've been thinking, I mean, to to kind of tie these two threads together and then think about geopolitics. I spent a lot of time in Latin America, and I Latin American economies, particularly urban Latin American economies, are already K-shaped. That's what they were. Like you go to like Guatemala City, a city that I think Guatemala, and you have a mass, you have the ultra-rich, and you have the very poor. And what I find interesting about this is people seem to miss these economies that are K-shaped for a long period of time are not particularly productive. It's actually a sign of stagnation, like deep stagnation. And the other thing that it tends to lead to is increased what you might call political cost or increased political externality cost, where you have to deal with the fact that these businesses have to stabilize their operations in increasingly politically volatile situations since you have a lot of desperate people. You know, desperate people do stuff like I don't know, drawing massive cartels that can pay them because they're essentially lump and bourgeoisie. Like, and the the American economy is not there yet. I mean, like, you know, it's it's not anywhere near there yet. But our structural trend is basically the same right now. I was gonna I was gonna ask you, you spent a lot of time in Eastern Europe. Eastern Europe has a reputation for a similar problem post-Soviet era. Is that true? Is that you you think that is a a fair analysis of Eastern European economies? Like they're basically K-shaped.

SPEAKER_02 41:20

Yeah, okay, 100%. And but here's the caveat, right? In some Eastern European countries, right, there's been actually wage growth. Yeah. Which hasn't happened in the US. So even though even though things are not obviously like there's a lot of political instability and all that, and and corruption, but there's been a wage growth. And it's almost like especially Poland, Eastern Europe is catching up, right? While America is stagnating. But then, you know, the problem is, and this is where it gets, you know, wonky, right? Because I cannot really speak about Latin America. Maybe you can correct me if I'm wrong, but at least in Eastern Europe and in Southeast Asia, things are not black and white, right? They're gray, right? And they're designed to be gray. And there's if things don't work out for you, or you know, let's say you're talking to your employer, whatever, and then you guys have a deal, right? And oh yeah, like we're paying tax on that, and we're not paying tax there, right? Or whatever. That cannot that doesn't happen in the West, right? Like, there's no gray, there's black, there's there's black and white, and that's it. It's very binary. But the problem is you are right, and the economy is tending toward like what we're looking at in you know, Southeast Asia and in Eastern Europe. There's no system right now in place that would provide to essentially corrections to maintain things the way they're going, right? Because they're saying, okay, well, we cannot let that happen. Okay, but then you know, people are not getting paid enough. So, like they need to make money somehow, right? And if you're being black, black and white about it, and you're saying, well, you gotta pay this and that and the other thing, and property tax, and then a business license, and then pay this and that and the other thing, and then the person cannot start that business. So, what's gonna happen? Right, I think that's I think it's very dangerous, right? Because who said this? I think it was in a Jordan Peterson interview that you know corruption is created by stupid laws. When laws in place don't provide you with what you're looking for, you know, the average person doesn't have time to, oh yeah, I'll figure it out. No, they're looking for shortcuts, right? And when there's too many laws in place, people are gonna start looking for shortcuts, right? And when you don't provide them with the shortcuts, and usually that is what happens in like Southeast Asia, Eastern Europe, then it creates a scenario where people cannot really cannot get ahead, and then it's going to escalate at some point.

Wage Stagnation Fuels Exit And Anger

C. Derick Varn 44:34

Well, I mean, this does seem like an overly rigid and and uh fragile system. And I I I have talked about this living in Mexico, everyone talks about the corruption there, which is real. I'm not not that it's not fake, but I would say well. Some things that are that the corruption is getting around in in Mexico basically reflects what you're saying is like in America, it's either just legal or not legal, and like like, for example, political influence campaigns that are that they handle through corruption in Mexico are legal here, but that weirdly means that only the ultra-rich can participate in them. And you know, this is not me saying the praises of corruption, it's just it's just it is showing you you have laws that they're fixed, and these laws they may be having perverse effects, they may be having the effects they're intended to have. It's hard to say, but they have created a system that rewards the already powerful to an extreme that in some ways it makes even basic politics, like which party you vote for, seem somewhat irrelevant to the average person. I mean, the the example is what you brought in about COVID. COVID had a lot of like stimulus packages and whatnot that looked like it was going to benefit the average person. But because of the way they were implemented, because they were payouts, because of a thousand reasons, it created an environment of a lot of upward transfer of wealth, both legitimately and through the government. Similarly, a lot of the way that we handled uh investment and banking after the 2007 crash, quantitative easing and this sort of thing seemed pretty progressive to the average person. But again, what it mainly did was empower like venture capital ventures and the that often failed but concentrated wealth more, etc. etc. etc. And unfortunately, in the United States, this is a long trend. This goes back to the at least the 1970s, and maybe even longer than that. But definitely you can't argue it if you actually look at the numbers after the 1970s. So I was gonna ask you, but I mean, like, how do you how do you deal with an economy that has had like basically rage stagnation? If you're a middle-aged millennial or even a younger Gen A Gen Xer, wage stagnation has been your entire life. Like, you don't know a period that doesn't have wage stagnation.

SPEAKER_02 47:17

So then you wonder why, right? Like, have have I and this is where it gets this this this thing, like what what you're what you're saying right now, I think it fuels a lot of anger, right? Because here's the thing, let's be honest. If you don't perform in a job, you're gonna get fired. Like we can all agree. So, what you're saying to me is that I've been performing because I've been keeping my job, but I'm not getting rewarded. And clearly I've been performing because I've been able to keep the job. Okay, but then what that means, but then things, you know, as you as you mentioned as well, prices are going up, things are getting more expensive, and then all of a sudden, here I am as a middle-aged millennial, and then okay, well, I cannot afford a house. Maybe in some cases, the person has to live with their parents, right? Or they have to live with roommates and all that, and then obviously that is going to impact your confidence and how you feel about life. And and I don't know if you've seen that figure, that figure, but for the first time ever in 50 years, there's been net negative migration in the US.

C. Derick Varn 48:42

Oh, yeah, I've seen it. Yeah, people at first thought it was just deportations, like, no, it's also brain, we have brain drain here, like we have actual brain drain here. I have you know, I it's insane. I spent a decade abroad in the mid-oughts, and I have been thinking again, like, even though I have a fairly stable job and and all that, like, oh, maybe I should go go back abroad. The only thing that keeps me is the geopolitical chaos, if I'm completely honest with you. Okay. And because I could replicate my lifestyle on about half my income in three other countries and very different parts of the world. And when I say replicate my lifestyle, that put me at a higher social and social economic class in those countries than I am here. But you know, I could easily get health care, way more easily get healthcare. I don't even get on that. I got out of debt, which is almost impossible to do in this country, etc. etc. etc. Couldn't buy a house because they were not easy to buy, and I wasn't staying there forever. But if I'd have really tried, I could have. Now, I bring this up because you know, it's we have net negative migration, and I think something like a quarter of a generation Z has indicated that they would be willing to leave the country if they could.

SPEAKER_02 50:04

It's it's a lot, um, and I think it's being fueled by a lot of things, right? So there's I mean, I'm talking, so I'm based in Thailand, right? If you go to a place like Huahin, which is a popular town near Bangkok, you hear a lot of Americans. Like, I'm talking, like there's more Americans in Hua Hin right now than Brits. And traditionally, when you're looking at the kind of people that moved here, French, British, maybe Dutch, maybe German, not that many Americans. Right now, if you go to like a night market, you're gonna hear, and guess what? It's not only just uh, you know, like uh a middle-aged man looking for a Thai girl type thing. Oh no, entire families, which is I think very scary. I see like there's like one channel uh here, and maybe your audience should check it out. His the guy's name is Isaiah Ashley, I believe. Okay, and he basically features people who move here from the United States. The guy has like more than a hundred thousand subscribers, and more and more and more and more people are moving here because they see you know generally there's a lot of safety here, you can afford healthcare. And people will go, wait a second, if I can make money online, like this is a better deal than in than America right now. And then on top of this, I mean, if you really think about it, the kind of people who move to the United States, they're usually not necessarily risk-averse, if you think about it, right? Like, oh no, I'm not going to move. No, I'm looking for the better deal because my ancestors did the same thing, right? Like they moved from their home countries to America because they were looking for better opportunities. So, can we safely assume that the Americans up today are going to do the same thing? Of course they will. Like, it's it's in their nature, right?

C. Derick Varn 52:23

I mean, this is this is interesting, and it's something that I think is under understood right now. But even before COVID, I had a lot of kids who'd be like, Well, I want to get to Europe, you know, and I'd like okay, good luck on that, kid. It's hard to get into Europe sometimes, unless you're willing to go to Eastern Europe, if you want, you know, it's a lot easier there. And they look at me a little bit weird, but today it's like I'm willing to go anywhere. I'm like, you know, the the you know, the number of X Pac flooding Mexico. I mean, there's like an open secret with podcasters, right? Like and video streamers, where if you're from California, what do you do? You move to Rosarito and you just do your podcast. You can actually live off your podcast in Rosa Rito, you can't do it in America, and you're very close. You know, you the border is a pain in the butt, but it's still gonna really only take you two or three hours. And I have just noticed more and more of even that. Uh whole towns in Spain, you know, the the parts of Europe that Americans can easily get into, which is Spain and Portugal, basically, sometimes, sometimes Ireland. I don't know about Poland, but those places, there's like in communities that are like half expats now, you know, age, and they're fairly welcome because also these communities are very old. They need you're actually bringing in money with you, like you are stimulating the local economy. There might be some shock around it eventually, but currently there's not a ton.

SPEAKER_02 53:59

Um I'm I'm look I'm looking for like real data for you, like right now as we speak. Okay, okay. Tribes, tribe of nomads. Okay, let's see how let's see, let's see, let's see. I'm I'm looking for total total number of people here, community info. Okay, well, in this particular group, there's 167 members. It's just a WhatsApp group, yeah, and these people all live here. So, like, this is just a paid community. Like, I joined because I want to you know socialize, whatever. But it's real, like people move.

Expat America And Brain Drain Signals

Institutions Fail At Media Literacy

C. Derick Varn 54:44

I mean, and and that's gonna create an interesting problem for for the United States because one, it's gonna make politics a little bit harder to predict when we try to like people have asked me, like, what are the politics of Zoomers? Because I'm a teacher, and I'm like, I have no idea. Uh, one, because some of them will leave, a lot of them will leave, uh, so you don't know if they're gonna be invested. Two, what I gather from most young people is that they're disgusted in general and are kind of politically desperate. So after Biden, some men who were particularly hard out in in the Biden economy, and I I know people will pretend that wasn't true, but I think it was. I'm not saying the Biden economy was bad, but I do think if you were a white, uh uh blue-collar man, it wasn't particularly great for you. It's probably worse now, though. And so, what are they doing? They're swinging all over the place as far as where they're gonna go politically. There's been a lot of talk in American upper middle elites that presume that patterns that were true for the late 20th century, or some patterns that were only true since, like, I don't know, George W. Bush, were gonna go on indefinitely. And that has become a very, very hard thing to predict and deal with. I wanted to ask you though, you know, there's an irony right now with platform monopolies and and and uh and all this, and maybe this will tie into a theme of institutional decay, because we have large-scale institutional decay, we also have tons, I mean, amazing amounts of of useful information completely out there for you if you know how to access it. Like, and I don't mean like just know how to access it, like have the right tools to get past the paywalls, like a lot of it's just available for free. But there's also tons of bullshit right now. Um, and we don't have any institutional guidance about how to sort bullshit from non-bullshit in a significant way, and I don't just mean like the Biden era, like, oh, we'll have uh you know a fake news commission or whatever. I mean like real bringing people up. I was talking to someone about in high school, I was like, why don't we teach media literacy? Like, we we know we have a decline in general literacy. We also know we have a decline in media literacy, actually, and like this has been studied. We don't teach it, and I got told, interestingly, is we can't do it for political reasons because neither side trusts institutions enough anymore, neither liberals nor conservatives, institutions enough anymore, for us to set out a standard to teach any media literacy about without us getting complaints, and legislate uh legislators will react to those complaints and and bar us from doing the media literacy. And that's really I mean, that's my experience too. Like what people talk about, oh, why don't kids read novels? There's a thousand reasons why we don't have them read novels, but but one of them is we don't have uh enough social trust or enough constituency for us to pick a novel that's not gonna offend enough parents for us not to have to pull the novel eventually, and uh and and this is real talk, okay?

SPEAKER_02 58:13

So this is like like really happening, right? So I like reading Harry Potter, right? Like it's the pollcast audiobook is available on Audible right now, so I'm rereading all the books. Now that's what I started with, right? And then, you know, I over the years I started reading more and more stuff, right? Like three-body problem, whatever, like more advanced stuff. Now I really got to a point where because I really enjoy reading, I can read really heavy, like heavy management books on 2x because what I do is I do audiobook and book at the same time. But in order to get up to you know, the you know, that level of reading comprehension to do 2x, I had to read a lot. A ton. A ton. And I also had to read things that I enjoy so I can build the habit of reading. If you hate reading, you're not gonna read business books, you're not gonna read any academic work because you don't like reading. So, what are you gonna do? Maybe you're gonna watch videos, yeah. That's fine, but then in order to uh have a better understanding of a subject, I do feel that you still have to read, right?

C. Derick Varn 59:40

Well, yeah, I was arguing with I mean, I'm gonna be careful about how I phrase this because I I don't want to offend anyone who works for for the employer, and I don't people could look up where I work if they really tried. But I was arguing with our digital learning people. I work, I also work in digital learning. I'm in I'm actually in a different department that that just I'm a I'm a teacher that is like three force online, not completely. I go in still and teach and whatnot when students need it, and I do a lot of one-on-one tutoring, and it's a public school, it's a public free program, it's not paid anything, it's kind of an experimental program to deal with things that started during COVID, and we maintained it. The problem that we have we have right now, though, is there are even administrators who do not see the value in teaching people to read books because they go the AI can do it, and I'm not I wish I was joking and I am not, and that's really dangerous.

SPEAKER_02 1:00:40

I think.

C. Derick Varn 1:00:41

Yeah, I've said the same thing because I'm like, how do the kids know when it's hallucinating when they can't check it? And like, well, they can I'm like, what ask a different AI? Like, what like what do you ask?

SPEAKER_02 1:00:53

How can you differentiate? Like, right, you know, like part of the so the reason why I can you use AI for the lot of stuff I do is because I trained it, like it's being trained on my stuff, right? If I don't know how to train the AI, the AI is gonna give me whatever, right? Like it's not going to be consistent. And I mean, I don't want to get into like the nitty-gritty of it, but there's like a token limit, right? And when the token limit is up, then it's going to wipe the memory. So, in order to you have to train it, it has to, it needs human input. Like, you're not gonna get magic just because you use AI in terms of knowledge, right? So you have to be you have to have education in place, and you have to have subject matter expertise to get the productivity, the productivity gains from AI. That's the way I'm thinking about it. So, I mean, yeah, like you you have to learn stuff, like it's like that you cannot take that away, right? Like, you cannot just remove it because all AI is gonna take care of it, right?

AI In Schools And Why Reading Matters

C. Derick Varn 1:02:03

Yeah, and I I think I mean we we've seen a couple of different, we have that attitude, then there's another attitude that I see at some elite schools where they're just like we are turning our back on technology altogether, our students are just going to learn pen and paper, and we're not we're not just getting rid of AI and cell phones and social media, we're getting rid of computers. And I'm like, okay, how I know I I do know that there are complications with screen time and learning processes and and blue light and all that. I'm aware, but it seems like that's creating a system where the where you have people who are gonna be where only the the top end of your students are gonna be able to integrate into a fully technological environment later on, since you've banned them from using it. Your top end students will be will be able to integrate because top end people almost always are, but it's it just it seems like both answers are just completely askew, and it goes to that black and white thinking. I want to ask you, you know, you've been a lot in a lot of places. Why do you think Western Europe and the United States, but particularly the Anglosphere, you know, particularly the United States and the UK, and to a lesser degree, but some degree Canada, and to a lesser degree, but some degree Australia are given to really black and white thinking and highly polarized thinking like this. What why do you think that is? Be speculative as you like.

SPEAKER_02 1:03:40

I think because back in the day, unfortunately, I have to use the term back in the day, there was a rule-based system, right? There were rules, and the rules essentially upheld the system, but that is going away. Right. And essentially, I think the West is in this state of shock that wait a second, like we actually have to do something very different here right now. And I think people deep down know, but then the system is not enabling people to kind of do what you know, what people do in Eastern Europe or or Latin America because they had to. It's not like, oh yeah, I want like, you know what? I I want to do things this way. No, I have to because I have to make money, I have to eat, you know, I have to I have to afford things. So people found a way around the law, right? Because the law did not enable them to do the things they wanted to achieve in life, whatever that may be. And I feel that is happening in the US right now, and in the West in general, that people are unhappy, the system is unfair, and they're being called criminals when they're trying to make something work for themselves, right? And I think that's very dangerous, right? Because if if you zoom out, like if you're just looking at data in general, like we could there's similarities between regions in terms of you know how economies work when there's a lot of wealth inequality, and the system is trying to correct itself somehow. It's not going to be fair, fair, but there's people are trying to make it work, right? Whereas in the West, well, we we do have a rule-based system, and people keep saying that, but people know it's not true anymore. I mean, just look at recent political events, right? And you know, obviously I'm talking about the Iran War, for example. Like, like how much more evidence do you need that there's a rule in place and then no one cares about that rule, and then everyone is just gonna watching and let it happen when clearly it's not legal. So but then you know that's where things fall apart, right? Right. Because if if if it's okay for you for for politicians to do all these illegal things, well, in that case, I'm gonna do it too, right? Oh, but if I do, I go to prison.

C. Derick Varn 1:06:35

I mean, this does lead to the conundrum that uh I have joked to people that if you're on the 30 under 30 right now, there's almost there's almost a 70% chance you're gonna be in prison in the next five years. No, I'm just referring to the the fact of all these young people get caught doing unfair business practices are straight up scamming the government. Um and I have been looking at that and going, well, in a way, yeah, sure, it shows that the capitalists are totally corrupt, but it at least ours. But also, like you kind of have to at this point to get any leg in if you're not well established. Yeah, what's your advantage? Like, what's your what's your upside, right?

SPEAKER_02 1:07:23

You know, right, and Americans are competitive, right? Right. Like people they're gonna compete. And I'm not saying any means necessary, but but then again, there's murder in every country, right? But then there's there's a fine line between that and then you're trying to get ahead in life, right? Like, like, is that a moral, right? Is it really a lot of people will say no, but and and like you know, like what what like what is it just because it's the law, does it make sense, right?

C. Derick Varn 1:08:05

Yeah, well, I mean, the other thing is just clear. I mean, like, we we could talk about the two biggest things in the news, the Iran war, which is both almost certainly illegal, although, like, I was like, okay, so they're gonna do another war powers measure, but there's not even a congressional authorization, and now you have Congress, I think they've given it kind of one now. But it's like, okay, a lot of the arguments from the president's own party was they didn't even need to do that, and I'm like, okay, you're not even going by a fig leaf. Another example. Whether whatever you think about the morality of the Iraq war, I opposed it at the time, and I think it was stupid, and I'll give all my opinions of that on the table. But even there, there is a fig leaf of law and a fig leaf of law going about domestically. So, like, it was an Iraqi court that tried Saddam Hussein, it was an Iraqi court that executed him, and that nominally was through legal processes, even if the war itself was a little questionable, well, more than a little questionable, but like was questionable under international law. There was still some pretense that national sovereignty was being respected. That pretense is gone, but also there's no even appeal for this to be popular to be popular, like the the the there is there, there is no poll on which this shows to have majority support of the uh uh people in the United States. That's kind of a first for a for a potentially major war. And that illustrates your point, like it's very and then lastly, the Epstein files, which even if only I don't know, a 20th of the accusations that have been released out of what we've seen have been true, we don't know if they were investigated, and we do know that there were claims that it was only one man, and we know that to be false. And those kinds of things illustrate that the average person in the United States doesn't have any faith that his government's gonna play right by them on almost anything. And then the a downstream effect of that, I saw a pup poll today that indicated that America was one of the only countries where half of the population views the other half as immoral, completely immoral. Uh no, it was half of the population views the majority of the American population as immoral. And I'm like, so social trust is gone. Like that's you know, that's not a good sign. That's not just a polarization sign. Like, it's not just, oh, Democrats, it's half the population think the majority of their country is immoral. And there was not a clear partisan bias to that number either when I looked at it, it was a little bit alarming. And so when I look at that kind of stuff, I'm like, you have a society that has a black and white rules-based order where it is also clear to the average person that the rules do not apply. And while there have been cases of this going all the way back to the 1960s, if you think about the level of like, you know, when I learn about like the church commission or uh Watergate or whatever, that all seems so quaint to the stuff we're seeing now, the violations of our own interaction.

SPEAKER_02 1:11:47

Well, underline that word, right? Because it's very true, right? And there's a there's a couple of things to untie here. So I think first I do feel that there's something has been triggered that will well, if it's not gonna split the country apart, like there's I mean, that's how countries start, if you really think about it. Like there's two cultures right now, completely different cultures, and it's it's really like you know, when I'm doing business with people, I don't have to ask them, hey, who did you vote for? Because I can tell based on the vibes. Like, okay, I like I can build uh kind of build up the persona, and I and that that's and I feel that's really crazy, right? Because that will create a lot of instability. Because I mean, if you really think about it, just like the way you can say, Oh yeah, like for example, in the UK, oh yeah, that person's Scottish, and there are cultural nuances, right? And it's it's a separate different culture, but and oh yeah, but those guys are English, right? I think in terms of unification and being on the same page, it's going to be tough. And then in terms of what you said about uh the Epstein files, I mean, clearly this whole thing is just about uh okay, we're gonna we're gonna make the the news cycle blow up on something else. And I we don't want you to pay and pay attention to this anymore. And you know, Christy Gnome's trial was we're hearing uh happened, I think not too long ago. And I mean some people talked about it, but how interesting is that you know, like, oh yeah, like we well, we can't really talk about that right now because like there's like this other thing going on here, and I think the bonus, and I haven't talked about this publicly, but I do feel that there's an indirect intent to destabilize the Middle East, specifically countries like the UAE, right? Because it's been a business hub, right?

C. Derick Varn 1:14:20

A lot of people go there, not only basically replace replace London as where you go to if you want to do business, right?

SPEAKER_02 1:14:29

I mean, you go to Dubai, right? That's where people, I mean, there's so much money being made in commercial real estate, whatever. And I feel like Trump's saying the only stable place in the world is the United States. So right now, Dubai is off the table. Uh Southeast Asia's off the table, see, because they're not getting oil. So it feels to me that they're trying to create the scenario where, well, you want to leave to tie it back to what we talked about earlier. Well, you can try, but we're gonna make it real difficult for you.

C. Derick Varn 1:15:19

I guess though the problem is it's not clear what the US is going to do with its own economy to to make it enticing beyond just unstabilizing everybody else's. Because I mean, outside of the AI, like manufacturing's down. The reshoring has effectively failed as far as manufacturing has gone, because no one can predict the the no one can predict the regulatory climate, they just can't. I mean, that's the problem with personalist leadership. Like, you like that that's based on a dude's mood. A person is harder to predict than an aggregate in a lot of ways. And you know, I agree with you. I have actually thought about this. I'm like, oh, so you know, it does look like even in terms of patterns, that there is a lot of American allies are actually not just Europeans, like Gulf states and stuff are actually getting screwed by this and bearing the brunt of the attacks in their oil infrastructure, etc. And people haven't looked at, like, yeah, you know who's the greatest producer of the world now? US.

SPEAKER_02 1:16:28

Not only that, I don't know if you heard, but in Dubai, the entire banking system was down. They don't they didn't have access to their bank accounts. Wow. So I mean, if you're thinking about like what a business owner, if a business owner hears this, right, okay, so essentially what you're telling me is Dubai is high risk now, or the Emirates are high risk now. So I cannot put my money there. It has to stay in the US.

SPEAKER_01 1:17:10

Yeah, that's that that is interesting.

C. Derick Varn 1:17:21

This place is a pretty bleak picture, though, for for monetary gains both within the US and outside of it. But it also seems to be it seems to be an invitation for cascade failure. Like if everything is hubbed in one place and everything in that place is hubbed in basically two industries, and and all you can do, like it's not like Trump is making America attractive to businesses by making it more productive or or any or having you know building up your population as workers or any of that. He's basically trying, he's it seems to be a knock-on effect of his actions, which is probably intentional, although we don't know that. I want to be very careful on how I say this. That it also makes business pretty much anywhere outside of like the United States, China, maybe Russia, which has its own set of problems, pretty pretty hard to hedge bets. And I just can't believe that doesn't uh backfire on the country doing that. You know, that there's not gonna be that the fallout is not just you know in that one direction. And I wanted to get your take on that because I just I I think if you destabilize your own economy and destabilize the world's economy, like usually there's consequences for that.

Loyalty Shifts And Gold As A Hedge

SPEAKER_02 1:19:01

I think the cultural impact of it is that it's super interesting. So I I think people who are and I don't have data on this, like I'm just I have some qualitative data on this, right? People who are like second generation Americans, that sort of thing, right? It seems to me that there's a growing loyalty to the other country or the country where their parents came from, that sort of thing. And they say, Well, I can claim citizenship, so while things are not really working out here, I might as well go. And I think the cost, the real cost is loyalty, because I mean at the end of the day, right? People came from other countries to the United States, a lot of people, right? So they have ancestry, like sure they it really depends on the person, right? First generation, second generation, third generation, whatever. But I think if you're telling people, if you're trying to bully people into staying, yeah, I don't I don't know. Like, I think what what will and what will happen is that you know what the other country where my parents are from, or whatever, they're not bullying me, so I might as well just go there.

C. Derick Varn 1:20:39

Yeah, I I have the bullying people in staying. The I mean the the other thing is like what is happening to dollar is relatively strong right now compared to what it was just a like a couple weeks ago for those who follow the international markets. Uh I'm gonna I'm gonna time sap this is in the first week of March because who got everything so volatile that by the time I actually post this, who knows the dollar might be worth what an Argentinian peso is worth. I have no idea, but I hope that is not true for my sake.

SPEAKER_02 1:21:13

But I let's hope it's not prediction.

C. Derick Varn 1:21:16

Like, but uh I am noticing, for example, like gold markets are hyper volatile right now. They're not, you know, it's not just gold is becoming valuable, it's it's it's going up and going down, going up and going down. But one thing we are noticing is like increasingly international actors are buying gold to hedge their trades, which historically is not a great sign. That's an indication that you don't trust anyone's government to be stable enough to really guarantee its money, at least outside of its own borders. You know, uh you you deal international trade. What do you see in that? I mean, what do you make of that? I mean, you know, it might be overstated, but it I I've seen reports about how much gold they're it's real.

SPEAKER_02 1:22:07

I I do follow people who are like they're that's their bread and butter, like they're gold investors, right? And the market is insane right now. And and according to this one person I follow, his name is Doc Casey. I mean, he's saying like it's insane. Like he's never seen anything like this before. That he never thought that gold would hit highs like this. And as he mentioned, it's being propelled by uncertainty and not trusting any fiat currency. And it yeah, I think I don't really think it's a good sign, right? Because yeah, sure, like for if you're an investor, cool, you're gonna put your money in gold, but then what if you don't have the disposable income that you can put in gold, for example? Like what happens then? Like it seems to me that the people who have the disposable income to invest will retain wealth, and then the people who don't will have their assets and money, uh like there is going to inflate away, right? And it's going to further propel everything that we talked about today.

C. Derick Varn 1:23:28

I I think the other thing that that we have to look at as far as geopolitical instability, and and maybe we could tie this to overproduction of leads and too much money in the system, but like system frailty. We we've talked about a lot of this in terms of the US, but I'm I'm literally watching newsbreak as we talk on on my RSS feed for Al Jazeera, and it's saying that France is now committed to provide armored vehicles to support the Lebanese against Israel. It seems to me that a whole lot of transnational institutions that we have sort of been depending on being relatively stable, such as the EU. That and the again, I'm uh I'm glad I times that this, but in the last week, we've seen major divisions amongst prime EU state members themselves about how to how to respond to the Iran issue with Germany completely backing the United States and even talking about helping the United States uphold an embargo against Spain, and then France and even Poland saying that they need to up their nuclear arms and accept that Europe needs to be militarily independent. You know, it seems to me that's a perfect storm for not being able to predict anything as a business person.

SPEAKER_02 1:24:49

But you know, I mean, that that's the thing, and that that's what I'm telling a lot of people. And it's you know the 2010s, sure, they weren't perfect, but there was relative stability, right, in terms of business. Meaning, if you're we're not doing well, well, you'd probably have to fix something, right? Like it's like from a business perspective, it was definitely something that you did. But then right now, there's major structural, socioeconomic, and historical changes. And because of that, it's like no one knows what's gonna happen because like it's like a really weird mix where you have AI on one hand, and then you have like this whole situation on the other, with war in Iran, and then essentially, as you said, EU member states choosing sides. So you cannot, even if you're a history buff, you cannot just like go back and okay, let's let's look up a parallel. Like, it's going to be difficult to find the exact one.

C. Derick Varn 1:26:01

Yeah, I I almost got in a minor debate with uh Sorabah Mari, the conservative pundit, who I happen to kind of know. We don't share politics, but we often actually do share analysis of war, and he was like, Well, I think this is gonna be Vietnam. And I'm like, I don't know that we have a model for what all this is. I mean, we have heads of state being arrested or similarly executed. We have the U.S. threatening to operate in multiple features of war at once. We have a very fragile world economy, we have high unemployment for youth. Not, I mean, we talk about it in terms of the US, but it's kind of everywhere.

SPEAKER_02 1:26:39

China, Korea, it happens in other countries as well, right?

C. Derick Varn 1:26:43

Yeah, it's it's kind of everywhere. I mean, we're we're sort of used to it, high youth unemployment in like Western Europe, but they also have a social safety net to kind of absorb it, that the United States more or less doesn't, and some of these other places don't. The other thing is you just have a lot of of unemployed unmarried men, and I don't historically that's uh that's usually a sign of volatile of volatility, like high levels of unemployed unmarried men, but you know, maybe I'm wrong.

unknown 1:27:16

I don't know.

SPEAKER_02 1:27:17

But I mean, I still remember back in the day in history class when we were uh when we were studying Germany, right? And how Hitler got elected, right? There were people were unhappy because the economy was unstable. And Hitler essentially rallied the German people behind this idea, well, I'm gonna fix it. I'm gonna I'm gonna get it all fixed, and it's going to it's going to be great, right? And we all know that that didn't really work out, but essentially, economic uncertainty, economic volatility, the all-invite authoritarian leaders. And yeah, sure, we could argue that it's it looks very different today compared to then, right? It it has a different form, but you know, we're still talking about human beings trying to organize themselves. So essentially the the essential fabric of what's happening is the same, right?

SPEAKER_01 1:28:31

Mm-hmm.

Climate Health Care And The Next Shocks

C. Derick Varn 1:28:36

It doesn't seem like you have a lot of like very optimistic takes for right now. I mean, I don't either. I'm not known for it, so don't don't don't have a pressure to like create one. But um No, no, it's fine. I I'm I'm normally I'm not quite a doomer, but I'm just whatever two steps removed from that are. But it does seem like we are just watching systems unfold throughout the world. And one of the things that that leads to is it it becomes very hard to predict what's gonna happen. Like that's bad for business, it's hard for politics, and like right now, you know, and and you know, there's things you and I have not mentioned. We have not mentioned climate change once, we haven't mentioned these other factors that like two years ago I would have been making a big deal out of, and I still think they're there. You know, I live in a place that used to have very cold winters. We have no snow for now four years in a row. Now, that could just be a weird weather pattern, but I I don't think so. And that for us is going to be quite interesting because we're a place that also that if we don't have snow, we don't have water, and we have a massively growing population. We're one of the few places in the United States that's growing. So it's it's an interesting problem, and there's not any institution right now currently trying to even begin to address it. Healthcare. I mean, we you know, we haven't talked about some of the some of the other problems with the United States healthcare, is like we don't have the doctors nor the nurses that we need, and we have an aging population and a very sick population compared to our wealth, and there have been reforms that have been passed recently that's gonna make that worse. It's you know, it's it's it's hard to believe that that won't have an effect. So I guess I I don't like asking anyone to make predictions because I think the prediction game is a fool's game. But what do you see as like the big trends you want us to be thinking about as we you know go leave this interview and start thinking about you know the maybe not so bright future?

SPEAKER_02 1:31:02

Well, I think it's really important for people to step back and well fight for change for sure, but clearly not the same way it's been done up to this point, right? Because something fundamentally has to shift, right? Protesting is not enough. Like something has to whether it's like the the way things are being discussed, right, or encouraging your you know the government to to step up their game, right? And and pet pressure them into doing the the things they gotta do. But yeah, I I think I don't want to say that drastic action is needed, right? Because you know, I'm not asking for okay, like violent, no, no, no, no. But something has to be done differently, right? And and people need to take that very seriously, like right now, before it gets worse. And and you know, like commit to whatever whatever system you want to live in, right? Like you want a rule-based system, not a problem, but then it has to be a rule-based system, right? And if someone doesn't obey the law, then it has to be punished to its full extent, to its fullest extent. And there's no well, that seems illegal. Yeah, if it is, then prosecute it. Take action now, not yesterday. Like, sorry, not tomorrow, but yesterday, right? I think it it has to be that way because because if things just go on like they they've been going on for a while, then it's gonna get to the point where it's going to be very difficult to go back.

C. Derick Varn 1:33:05

Yeah, I mean, in the case of the United States, it could even be as severe as we.

SPEAKER_02 1:34:15

Yeah, because they became different, they become different countries, yeah.

C. Derick Varn 1:34:18

They're defective different countries. And I don't, you know, sometimes I go, maybe that even won't even be a bad thing, but the thing is, I don't see that ha how that happens easily without some severe consequences. Yeah, so I guess neither one of us have a whole lot of bright and happy things to say, but I do agree with you. Stuff needs to happen. I also agree with you. I think pro I don't wanna, I don't wanna, I don't wanna mock or demoralize protesters, but we've had a lot of protesting now for 50 years, and I think we need some severe rethinking of if that works or not, you know, and that's why we've got and as far as like violence. I'm I'm not necessarily kind for that either. I think in the United States, that's a good way to not live very long, but it it does seem like we have to reconceptualize pot politics pretty drastically.

Where To Find Matt And Closing

SPEAKER_02 1:35:17

There has to be something in between that is not violence but more than a protest, right? I think that's the magic bullet, right? Yeah, what is that? I don't know. I know it's it's hard to answer, but I think whatever it is, it's a different category, right? It has to be. Yeah.

C. Derick Varn 1:35:40

Well, thank you for your time, Matt. Where can people find your work?

SPEAKER_02 1:35:44

They can find me on YouTube. That's where I've been focusing on content creation. Like that's where you can you guys can find like everything. I also have a website, companygrowthpartner.com, and I also have madborka.com, but in terms of content, definitely YouTube.

C. Derick Varn 1:36:02

Thank you so much for your time, and people should check out your work. I think I in preparation for this, I watched and enjoyed and was a little bit terrified by your business prospects in the Iran War video that you just released. So if people want something percient, although who knows, by the time I release this, like I said, even though it's only gonna be three or four weeks, it might all change. Like, um, so uh we'll see. I mean, the crazy thing I can say about this year, even more than last year, is it seems like every two weeks I have another major crisis that's completely different than the last one I was talking about. So I'll give Peter Turchin that. He did predict that the 2020s was gonna be a period of massive instability, and he seems to have been right.

unknown 1:36:53

Yeah.

C. Derick Varn 1:36:54

All right, have a good day, Matt. All right, peace.