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- FDA request to withhold facts for 55 years denied
- Record high margin debt crash signal taken by bulls as greenlight to buy?!
- Recommended read: Vaclav Havel’s The Power of the Powerless…attached
The McAlvany Weekly Commentary
with David McAlvany and Kevin Orrick
Cognitive Dissonance — Please Don’t Confuse Me with the Truth
December 7, 2021
“If you’re going to discuss something, if you’re going to debate something, well, that unhinges the already-settled issues. I think that’s where, when I hear the Schwab notion of “we’re moving from a reset to a great narrative,” I think, “What kind of reality needs to be defined that we all need to sort of get in line with?” Are all issue settled? I thought all issues were up for discussion and debate. But this is maybe the delusions of a philosophy student.” — David McAlvany
Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.
Dave, it’s that time of year. Every year we ask for questions from our listeners, a lot of times we’re the ones who learn through the questions. And so we would ask you to go ahead and get us those questions, in the next few weeks we’re going to do the question and answer program. Dave, do you have the website that they can send those to?
David: Send your questions to email@example.com, M-C-A-L-V-A-N-Y.com.
Kevin: My wife and I had a conversation with a couple the other night, and I realized as we were talking, facts didn’t matter, that their minds had been made up. I won’t get into the subject matter, but I’ve had more and more conversations, Dave, with people who are intelligent people, who have made their decision already, and when asked if facts could be provided to you that would prove that maybe some of the things that you’re thinking are in error, would you be interested in seeing them? And I’ve been told several times, recently, from intelligent people, “No, no. Our mind’s made up, we like the way we feel thinking the way we’re thinking.” And so I’m just wondering, Dave, if we’re in a period of time where we no longer can critically think as a society. We’ve chosen what we’ve chosen, and we now just find things that would prove that we’re right on our side.
David: Yeah, the organization of facts is really what’s key. If you said to yourself, the command and control dynamics that you see in China are the reason why we’ll never see a crash there, and on display this week is the People’s Bank of China reserve rate requirement cut. Lo and behold, we’ve got a rally in equities in China.
David: Do you see? You see?
David: There’s never going to be a crash in China. There really is no problem there that we need to pay attention to, because they’ve got the tools. The facts are in alignment with that, don’t you see?
Kevin: Does this remind you of last week when I quoted your dad, “Always mistrust the obvious.”
David: Yeah, it does, because it reminds me when you think you have a solid grasp of the issues, when that’s the position that you’re in, you’re probably not in possession of the most relevant facts.
Kevin: And you may not even want them, to be honest with you. That’s the thing that bothers me.
David: Yeah. You may think you have an idea of what’s going on, and it’s likely far more complicated. So reading outside your field, conversing with people you don’t necessarily agree with, these are good practices, particularly if big R reality matters to you, or big T truth is on your radar. Certainly, the financial markets illustrate this. What are the relevant facts? To most investors, you’re talking about price action, the direction of the market. That’s the singular—
Kevin: If you’re making money, it’s good, right.
David: That’s the singular box to check. Not knowing enough about valuation metrics, not knowing enough about momentum, or volume, or sentiment, or technical analysis, or seasonality, or speculation, or leverage, or any of the other rabbit holes of analysis, the default observation is just direction.
Kevin: Hey, if it’s going up, it must be going up.
David: If it’s up, it’s good, I’m in. Down is bad, and can I have my money back, please?
Kevin: Well, and life is getting so much more complicated. One of the books that you reintroduced me to that I’ve been reading through along with you, Vaclav Havel wrote in 1978, The Power of the Powerless. And it’s just a profound, profound document. It’s 80 pages long. I was talking to my wife about it last night, and she said, “Kev, you can mention it, but very few people are going to read it. Life is so busy these days, when they find out it’s 80 pages, it doesn’t matter how good it is.” And I hate to say it, she’s true. What she said was, “It has to say everything in the headline, otherwise people no longer— They need to simplify their life, because it’s so much at once.”
David: I think that if anyone really wants to see the nuances of what is happening in our society today, you’ll go back and you’ll see things from a different vantage point and through a different lens, and Havel provides that.
Kevin: He wrote this and then he was imprisoned, and then 10 years later he became president of Czechoslovakia.
David: Yeah. As a playwright, as an artist, he has an insight and a level of critique into his own social milieu, which is really, really helpful. So back to the financial markets, the fragility in the financial market is ignored, because it’s actually more than just a directional suggestion.
David: You’re extrapolating from the immediate past, up, up, and away from here, “Look, this is what we need to know,” that’s all we need to know.
Kevin: But like my wife said, we want simple takeaways. If the headline doesn’t show it, I mean, a headline’s either going to show that a market’s going up or down.
David: Yeah, if there’s too much nuance, then it’s not something we’re really interested in engaging with. We want simple takeaways. Are we okay, can we invest and know our future financial goals will be met? We’re looking for assurances and certainties, that’s the capital we prefer to deal with. And I think it’s how we’re wired. So a simplified answer, a clear-cut plan, removal of nuance so that we can have a crystal clear conclusion, don’t muddy the water with elements that leave any doubt in mind.
Kevin: Right, it creates tension. It creates tension, and it also forces you to slow down and take some time. Do we even have critical thinking anymore, as a society?
David: I think we’re in an age where critical thinking is all but dead, and a part of that is the reason why we can’t engage with complex analytics. Part of the problem, and why we need simplicity, why we need a quick answer, a headline as you describe it, people generally disregard complexity for the easy answer.
Kevin: Well, and not to be ironic here, but Occam’s razor says that usually the simplest answer is the right one, but Ockham would tell you that that is after careful analysis of all the variables. And what we’re talking about here is not finding the simplest conclusion, because sometimes the simplest conclusion is the best conclusion, but you should not accept it until looking at all the options.
David: Memory doesn’t always serve me well, I’m not sure if I’m putting the right people at the table here, but William of Ockham is very different than Oscar Wilde in many, many respects.
Kevin: Oh, do you have an Oscar Wilde quote?
David: I wouldn’t give a fig for simplicity on this side of complexity, but I would give my very life for simplicity on the other side.
Kevin: And what that means is you have to look at both sides, or three sides, or four sides.
David: Look through the complexity to value what simplicity is. Otherwise, it’s—
Kevin: Do you remember in Fiddler—
David: —just cliché.
Kevin: Okay, Fiddler on the Roof. “On the one hand, and then on the other hand.” I love that piece, because—
David: Well, that kind of—
Kevin: —he’s debating with himself, what’s the right answer?
David: Yeah, and that kind of interaction, or internal thinking, today is off the table. It’s not going to happen around the dinner table, literally. And this is something my wife grew up with. She speaks of her stepfather and says, growing up, they would routinely be discussing some topic, and in the middle of the conversation, a switch was called, and you henceforth had to argue the opposite of your original position.
Kevin: What a great idea.
David: So the topic could be abortion, it could be tax increases in government spending, it could be why Ninfa’s has the best fajitas in Texas.
Kevin: Have you had Ninfa’s fajitas, is that what you’re saying?
David: Well, I know how to argue the pro on that one for sure. But today’s public debates are far too ossified. Nobody wants to stretch themselves. Who wants to take the time to argue the other side? We’re convinced of things not based on critical thinking or research, or evidence, but rather on the basis of presentation by media outlets, or by organizations with a vested interest. We lead with conclusions. Headlines are the story. Don’t fret about the details. We move on very quickly from the headline, believing that we’ve somehow captured the truth. There’s no need to build a case, or consider the other facts which may substantiate a far more compelling conclusion. Now, I want to come back to that because we would agree facts are the facts, of course. But we can’t forget that how your organize those facts is a different matter altogether.
Kevin: I had a conversation with someone we both know, and he’s one generation below us, Dave. And he made a very fascinating statement, he said, “You know, as I get into discussions with you, I have to really fight my need for consensus.” Because he says, “My generation has been taught not to say anything that might be disagreed with by anyone else in the room.” That was powerful, because that’s so different than what you’re talking about with the switch. “Okay, we’re going to take a side, we’re going to argue this side.” I remember when my daughter was in school and you had one side arguing for, it was a courtroom scene, they had to argue for evolution, origin evolution from the very beginning, and the other side had to argue for intelligent design. Well, it was really interesting to hear how both sides learned and actually gained empathy for the other side.
David: Well, I think today we’re dealing with more of a curated reality. A curated reality, I mean, again, when we talk about organized facts. And we’ve talked with Justin McBrayer about how we’ve got algorithms which are organizing facts for us, we’re not even cognizant of it. But what we’re presented with is the facts that we prefer to see, given big data and social media and the way that those technologies give us our own personalized feeds. But curated reality is more common in the 21st century, given the usefulness of big data, instant communications through social media, and of course media RSS feeds. But curated reality isn’t necessarily new. If you think about propaganda as a powerful tool used by powerful people to harness the power of social constructs toward a desired conclusion, you begin to see, “No, actually curated reality is pretty old.”
Kevin: Well, and we really can’t fool ourselves. Propaganda exists on a good side or on a bad side. I mean, it’s really, what are people moving towards together? But you can see propaganda easily being misused when the facts are either being hidden— Look at this trial that’s going on, Ghislaine Maxwell. There are things that are coming out, and then there are things that seem to be purposely being put under the covers, literally.
David: To me, that’s one of two great examples of curated reality right now. She was never offered a plea deal. If you just pause and let that sink in. This is a woman who likely has a list of sexual predators and pedophiles multiple pages long, and prosecutors don’t want to know who and what she knows? That’s interesting. That’s interesting.
Kevin: Well, and that ties into the Epstein network. If you really think about it, who’s not on the list?
David: Yeah, the Epstein network on Wall Street, and in Washington, DC, and in the world of tech gets a free pass from justice, either because the list of connected people is so damaging, or the dirty work of the intelligence community, which I think is very much a part of [this], is just under the surface and the collateral damage too great. So, the proceedings are going to reveal something, and then they will not reveal something. Not getting a plea deal is very interesting with Ghislaine Maxwell, and so you’ve got a Kevin Spacey, and a Prince Andrew, and a Bill Clinton, and Donald Trump, and Bill Gates, and hundreds of other scions of sleaze who are going to pass into history as the winners. Meanwhile, I mean, some of us will still wonder. So Epstein was in the White House visiting Bill Clinton no less than 17 times.
David: I’ve always wondered if he brought flowers to the Oval Office.
Kevin: Maybe he got the little “I visited the White House” button. Maybe that’s what he was there for, is just a collection of buttons.
David: Why was Bill Clinton’s Secret Service detail not on the Lolita Express 10 of the 26 times that Bill was flying with Jeffrey?
Kevin: Wow, wow.
David: It’s just very interesting, when you think about it.
Kevin: Well, and you brought up Trump, I mean, Trump’s involved too. I mean, this is horrible.
David: Yeah, the media has lost its Me Too credentials on this one.
David: And you just see how, if Me Too is a 21st-century ethical expression, somehow ethics is situational, circumstantial, or convenient. Because here it is, we’re not going to ask questions that legitimately should be asked.
Kevin: Okay, so, but they don’t want her to talk. Now we’ve got the FDA, we’re saying, “Hey, we need you not to talk for the next 55 years about what you know.”
David: Well, I mean, this is back to Pfizer and the Emergency Use Authorization that they got for their COVID vaccine. So this is amazing, we’re getting information from the FDA research on the COVID-19 vaccine. Again, this is the data that the FDA used for the Emergency Use Authorization of the vaccine, and the data’s not positive. When I say not positive, until this point, nobody knew that there was 42,086 adverse event cases, 158,893 total events, including 1227 deaths. And this is information that the FDA had on the vaccine, and yet is only now public.
Kevin: Yeah, but there was no plea bargain that was offered to them either. They said, “Keep your mouth shut for 55 years.”
David: Well, that’s what Pfizer was asking for. The FDA is releasing the information on a court order. They’re mandated to release 500 documents a month, which is not what the FDA wanted. The FDA had requested from the courts to keep the information on the Emergency Use Authorization confidential for 55 years.
Kevin: What’s the FDA for? They’re for our protection, right?
David: Well, just think about that. Asking to keep it confidential for 55 years, that’s interesting. Real confidence-builder. I mean, let me tell you about my faith, my faith in scientists. Now, I don’t have a problem with science, but framing and fair data access is kind of key to informed decision-making. It’s almost like the scientific community suspended informed consent on the basis that deferred consent, deferred consent was justifiable in the context of pandemic. Did you know that some doctors and scientists believe they are also legal and medical ethics experts as well, because that’s essentially, that’s what you’re doing.
Kevin: Well, how about school boards? How about school boards? I read your letter, by the way, and I think you ought to bring up what you brought out in the letter. Because when a school board is making a decision on a mandatory vaccine, do they actually have the same protections that the drug companies have, the government has, as far as some day, if the ramifications turn out to be damaging to the children?
David: So for context, the school board discussed last week the possibility of a required mandate for the vaccine.
Kevin: Your son’s high school, basically.
David: Yeah, yeah. Yep. And he’s in a shared program where he can do both homeschooling and he takes a number of classes there as well. And so it’s relevant for me, and I wrote a letter to the school board. And I said, “Have you considered the fact that the federal government and pharmaceutical companies have the equivalent of a get-out-of-jail-free card? They don’t have liability as it relates to the vaccine.”
Kevin: No matter what the consequences are of what they ask or force.
David: Just consider the difference between suggesting a vaccine and mandating a vaccine, and you’re mandating something for minors, which has its own complexity, okay? But then you also are mandating something, and you don’t— Well, let me ask you. Which if the school board members has immunity from this? I mean, do you have indemnity? If there’s something in the long history of biological interactions with this stuff, with these kids. I mean, maybe it’s 10 years from now, maybe it’s 20 years from now. When they come knocking, after they look and say, “Okay, well, the government’s legally protected and Pfizer’s legally protected because of the Emergency Use Authorization,” are you covered by that?
Kevin: Okay, so school boards, but I’m even thinking about the commercials that I’ve been seeing. I told you, we get New Mexico TV, because we’re so far south here in Colorado. And the commercials that are telling people that they need to get their kids vaccinated are not giving any details other than the fact that this is going to keep them perfectly safe from everything going forward. I mean, I’m overstating it, but that’s the way you come across.
David: Right, it’s a social appeal, and it’s an emotional appeal in terms of what you want for your kids, which is not only physical health, but also emotional/psychological health, and they realize that they want to be back to normal, and back integrated into schools and after-school activities and things like that.
Kevin: So as mainstream media, do they have indemnity?
David: You would think they do, by the way it’s presented. But anyway, the mainstream media’s not keen on covering the FDA disclosures, and this is, I think there’s real collateral damage here. What facts are appropriate to discuss? That’s where we’re beginning to see, again, sort of a continued curation.
Kevin: How about the American Heart Association, what are they seeing right now? I mean, the increase in heart attack is much higher with the vaccine.
David: Well, consider that Twitter made it a moral obligation to make sure that Trump could no longer tweet. And so there was a point at which they said, “Nope, he doesn’t reflect our values and what we think should be communicated publicly,” and yet they did the same thing to the American Heart Association this last week, censoring— Twitter—
David: —censors the American Heart Association for discussing their findings that the mRNA vaccines are increasing the risk of developing heart disease from 11% to 25%. And you look at the American Heart Association abstract 10712 if you want to do your own reading on this, abstract 10712. And the jump from 11 to 25%, Twitter thinks, “Nope, that’s just not up for discussion. That’s not up for discussion, that’s not a fact that’s relevant given the narrative that is acceptable at this point.”
And back to that issue of who’s got the legal protection and who doesn’t. Really not a surprise here to hear of the vaccine not being distributed in certain parts of the world, okay? The World Bank president, this is the World Bank president on Bloomberg Television, just like two days ago, David Malpass. He says Pfizer has been hesitant to go into some of the countries because of liability problems. They don’t have a liability shield. Now, that’s interesting.
Kevin: Isn’t that interesting?
David: That’s interesting. The Emergency Use Authorization is a US legal phenomenon, it’s not a global protection, right?
Kevin: So they’re just not going to send the vaccine into the countries where they can’t get that indemnity themselves.
David: That’s correct. So Pfizer got the same Emergency Use Authorization for kids from the FDA, and is now pushing for lower and lower ages, right? I had a great interaction, as I mentioned, with the school board on this this week. And I just want to know who’s got the indemnification. Because Pfizer’s very hesitant to ship product, where they have is what, again, David Malpass, the president of the World Bank says they have no liability shield, so the product’s not getting shipped. Isn’t that curious? I mean, I thought we were just out to save the world, I thought this was about science and saving people and— Oh, wait a minute? You mean there is actual risk that you have to keep in mind?
Kevin: I have to figure that there are listeners right now that are getting uncomfortable because they’ve made their decision up, but I doubt it, because most of the people who listen to this program, I love. I mean, I look at the comments, Dave, or we’ve got question and answer programs coming up and I love the questions every year. We usually do two programs where we’re answering our listeners’ questions, and you realize how much they engage. But the average person listening to this show right now, if they’ve made their mind up and they don’t want to hear facts, turn it off. Turn it off right now. Don’t keep listening, because, I mean— But this goes back to how we started, what we were talking about. People right now want a simple answer, and it’s too confusing now if other facts are coming up as far as making a further decision. Let’s take the financial markets as an illustration—
David: I think one thing I would add to that, though, Kevin, is that what I hope is that people engage and ask questions, ask further questions.
David: Where if there’s something that is disagreed with, let’s learn together. Because I don’t know that I have everything figured out.
Kevin: The Socratic approach, just ask the question.
Kevin: Yeah, you ask a good question. It’s like Socrates, ask a good question. But you have to be willing to listen to the answer. Look at the financial markets right now, the things that would absolutely tell of a top in a market, I’m not saying it is, but the signs that would tell of a top in the market are the very things that people who believe that the market is going to go higher, they’re using those as their positive affirmation that they’re right.
David: Right, yeah, the financial markets illustrate which facts are relevant, what are the relevant facts? There’s a famous book, Whose Justice? Which Rationality?, and the financial markets are an illustration— Again, the vast majority of people would look at facts and interpret in a certain way. We’ve got margin debt levels for October, those numbers passed 965 billion.
Kevin: That’s amazing. Margin debt is what you borrow to go invest more.
David: But the vast majority of investors and Wall Street are going to say that’s confirmation of upside momentum. Only the contrarian is going to say, “Too much, too far, what’s next?” In fact, this is confirmation of upside momentum. It’s supported by retail interests, you’ve got a growing investor base, they’re just coming into the market for the first time, and want to bet their dollar and half of someone else’s. So never mind that options trading has increased over 400% over the last, yeah, 18 to 24 months, and the biggest call option activity is in companies that don’t make any money.
Kevin: Well, and remember, Buffett steps away from the markets when the capitalization of the stock market is a lot higher than GDP. But you’ve got those same guys right now who are seeing their market shares go up saying, “Oh no, this is just confirmation that it’s going to go higher.”
David: Well, speaking of confirmation, it’s really speaking to confirmation bias. You generally find what you’re looking for. That’s called confirmation bias. And so bears and bulls are both human, they both tend towards that bias. And you have to account for how you’re coming to the conclusions that you are. Hard Assets Insights this last week, we referenced the Buffett ratio, that is the capitalization of companies in aggregate compared to GDP, the engine of growth compared to the paper representation of it. So most in the investment community right now would see this ratio as confirmation of bullishness, and it’s positive, it’s not a contrarian indicator, it’s not a negative. Just tell me, are we making money? And I’ll tell you if we’re okay.
Kevin: Okay, so it’s like Fiddler on the Roof, but not. Okay, let’s say he’s one-handed. So what he says is, “On the one hand, and then on the same hand—”
David: On the one hand, yeah.
I spoke with a friend recently and found that being invested, being invested was more important than dealing with the tensions of ignoring the what to me are obvious record levels and exposure. I find myself on the contrarian side of this. The contrarian bet would be to reduce market exposure when things get expensive, to elevate cash levels, to maintain a hedge in the form of gold. Those choices would suggest an alternative narrative had been contemplated, a narrative that embraces the possibility of not just a choppy market volatility—obviously we’ve had a lot of that in the last week—but an actual shift in direction, a directional shift where volatility increases on the downside. And as I talked to this friend, there is no consideration of a major top being put in. It’s just looking and saying, again, “Are we making money? If we’re making money, then we’re okay.” And there are ample facts available to support that conclusion. These facts are sitting alongside other facts, including a destabilizing geopolitical backdrop.
Kevin: We talked a few months ago about a lady who owns a Chinese food restaurant here in Durango. I went there yesterday, I was reading the Vaclav Havel piece, and so I went and had lunch. And the lady who owns the restaurant, she, I believe, has her Master’s in International Relations. Really interesting gal, and she said instead of going to work for the UN or what have you, she had fallen in love with Durango 30 years ago, opened this restaurant, and it’s really interesting. She says she does her international relations now in a little town in Colorado.
But just yesterday she was really sad, Dave. She just sat down and talked to me, because of course her parents are in Taiwan. And what she was trying to contemplate is why, why when something is so obvious as what she sees, an ultimate Chinese takeover of Taiwan, why do the people, including her parents, just live life, even though the facts are obvious, just continue to live life. And we talked about it. Life is busy. You’ve got day-to-day things that have to be taken care of. There are obvious things. I remember when Saddam Hussein amassed, back in 1989, 200,000 Republican Guards on the border of Kuwait, and very few people actually saw that as a potential invasion. So looking at Taiwan right now, looking at the Ukraine, what does a person do when they see these things happen, or about to happen, what do they do? I mean, you can’t stop it, so do you just live your daily, everyday life? And that’s what made her sad. She doesn’t know how to convince her parents they need to get out.
David: Well, there is meaning, and that very well may happen, we don’t know. And again, this goes back to my earlier point, is about the time you think you possess the relevant facts, it’s probably more complex than you know. And again, the illustration of convenient facts, we talked about a couple from the financial markets, but I think you find the same kinds of things, again, supporting a preferred conclusion. Ukraine comes to mind, with Russian troops on the border. Taiwan comes to mind, with sortie after sortie flown each week by the People’s Liberation Army Air Force, PLAA. COVID-19 comes to mind, with the World Health Organization and the Centers for Disease Control and Fauci providing an all-encompassing and conveniently streamlined understanding of science, I need to make something clear here. You don’t conceive of the flu shot as a vaccine, because it’s not. And yet we have the Pfizer CEO and Dr. Fauci this week both saying that the only way to keep in good condition on this, and this is just this last week, is an annual shot. That’s the only way forward.
Kevin: The forever virus, remember, we talked about that, yeah.
David: Just, it crosses my mind, are we still using the language of vaccine? Where are the lines blurred between Pfizer corporate profits and “science”? Because honestly, it doesn’t take a Marxist critique of capitalism to see that unfettered activity, zero liability, no corporate accountability, I mean, are you kidding me? Are you kidding me? Are you begging to see the dark side of capitalism on display? I mean, that’s what you’re opening up, is a Pandora’s box for capitalism when you take away liability, which is the only form of—
Kevin: Well, capitalism—
David: —accountability within the corporate universe.
Kevin: Capitalism is built on consequence. I mean, that’s what you’re doing with capitalism is you’re trying to profit based on consequence. But you’re right, there is a dark side. There’s a dark side to socialism and communism, there’s a definite dark side to capitalism without consequences.
David: So we come back to Ukraine. And you’re going to think I’m weird for connecting dots between Ukraine and climate change, but climate change comes to mind, where the devil was nuclear, until we needed to see the light. And I’m thinking that perhaps energy-dependency on Russia and the reliability of fossil fuel supplies from the Great Bear are becoming more disturbing to European leaders after all. We hate fossil fuels enough to rekindle a nuclear glow? I mean, this is really interesting to see what happened in Glasgow just a few weeks ago. Perhaps the global climate agenda cannot be adequately pressed forward with 20th century energy dependencies like Nord Stream 2. Being reinforced, being codified, so just as we’re on the cusp of a renewables revolution, we’ve got the signing of a document, a long-term contracted agreement between Germany and the Russians for this energy? And that’s somehow getting squirreled as we speak.
Again, you’ve got traditionally more affordable fuels, like natural gas, they’re readily available from the Russians, and all of a sudden that deal is off, right? Kill the messenger, actually, the delivery agent, kill the pipeline. And this revival, simultaneously, of a forbidden conversation, a forbidden conversation amongst conservationists to include nuclear as part of the solution? I mean, to me, this made sense years ago. If you’re going to have a reasonable conversation about climate change, start looking at nuclear, and yet that’s been off the table for years. Now it’s on the table again. Maybe there’s a coincidence, I think very few things in life are merely coincidental.
Kevin: Well, you have to change the narrative for the bigger picture, and see, that’s the big thing. The story that you tell has inconsistencies in it, Dave. I mean, I love wind energy, I love solar energy. It’s just fascinating to be able to capture energy like that. But I gave you a book years ago for your kids and for yourself that just asks questions that you get to solve on the back of a napkin, basically, you just try to, you work it out yourself. It’s an estimation, it’s called Guesstimation, it’s a great book. What it does is it forces you to sit down and as a, not a mathematician, but just somebody who knows basic math to just say, “Okay, is it reasonable to, let’s say, heat and energize the United States using wind energy or solar energy, how many square feet does it take to do that?” Or what have you. And it’s fascinating, because you find out yourself by doing your own calculations that you’d have to really bend the math to make that work.
David: Bend, how about torture. Torture the math to make economic sense of photovoltaics and wind energy. And I agree with you, I think it’s brilliant. We need to invest in making photovoltaics more effective, and I think there’s military applications of that which have not been commercialized which have already done it, which are far more effective, which do have long-term economic potential, but the cost to build out those things is very high.
Kevin: Well, and I have a strange question. Okay, if we are moving towards a technological revolution where we can use those things, and I think we are, you’re going to need oil, carbon footprint stuff, to actually fuel the science to get to that point where you don’t need it anymore, are you not? Couldn’t we be cutting this thing off so early that we’re actually, down the road, we’re dooming a project that could possibly succeed.
David: Yeah. Well, and I think that’s where some of your brighter folks who are engaged in the commodity space today would say, “Look, these are the assets that we’ve got, and we’re going to run them down. We’re not investing in them further, but we’re going to run them down.” If we sell them off, you know what’s going to happen. Somebody else is going to take the asset and exploit it, and maybe they’ll turn a coal-fired power plant into something that produces Bitcoin. I mean, who knows? But whatever it is, it’s better for us to control the asset, run it down, and create a green plan on the other side. Substitutions, but we’re talking about a resource that’ll take 10, 15, 20 years.
Kevin: And you’re going to need energy to actually develop new technology. But what if you kill the messenger?
David: I think what we saw at Glasgow, the COP26 Glasgow conference, sponsored by the United Nations, it does reaffirm a move away from fossil fuels. But that’s also a move away from dependent relationships with fossil fuel providers. Okay? So—
Kevin: You’re thinking of Russia, right?
David: So you get global carbon emission levels that are essentially flat for the past decade. Yes, they’re at near record levels, but I repeat, they haven’t risen substantially in 10 years. It’s not to say that carbon emissions are not an issue, but the panic level of emotional intensity and the desperate pleas to change policy now before it’s too late, again, you’re dealing with overtones and, well, frankly the emotionality there helps unify public policy on a global basis. If the issue was not cast in such an apocalyptic light, it’d be easier to engage with from a policy perspective for me, for me. Because I don’t do well with sort of leveraging of emotion in that respect. I see the hallmarks of propaganda, my pace slows significantly. So, again, back to Ukraine, how does this relate to Ukraine? What is Ukraine about? Russia may want Ukraine as a part of its return to greatness, I get that, as an expansion back to its old real estate portfolio.
Kevin: That’s what Dr. Friedman would say, that is a part of it. I mean, Russia needs that 500 miles between its enemies, at least throughout history.
David: But it’s convenient timing, it’s convenient timing for the US to report on troops at the Ukrainian border. And this is really noteworthy in my mind. It’s our intelligence alone which has made all the difference in persuading our European cohorts, the European powers, to pay more attention to what may be an imminent invasion. It may be an imminent invasion. But the only group providing granular intelligence on this is US intelligence, okay? So it’s just interesting. It’s convenient timing, we’re reporting on it, now we’ve got—
Kevin: So what’s the motivation, what are you thinking? Why would we be doing that, why is it in our vested interest?
David: Yeah, well, and again, it’s more imminent now than it was a month or two ago, we were talking 90 to 100,000 troops, now it’s up to 175,000 troops. Look, the West has a vested interest in keeping Russian and German economic ties wobblier, if I can use that word. How far would we go to support US interests abroad? How critical is the green agenda to shifting global power structures that some have associated with Klaus Schwab’s Great Reset? When you look at Russia, and you’ve got sort of the ideals of the 21st century in mind, has Russia become an obstruction to 21st century progress? Quote-unquote progress. Schwab is changing tunes right now. This is not Charles Schwab, Klaus. Different guy. Schwab is launching a new initiative he calls the Great Narrative, this was in Dubai a few weeks ago, where he’s promising a grand vision for all of humanity, and it’s going to sort of guide our decision-making and align us equally, regardless of nation-state and domestic priority.
Kevin: I read the article, it’s a shared global story. And the thing is, the reason he’s saying that has to happen is because they are not meeting their agenda at this point, and they need people to have a vision and a shared story. I was mentioning to you last night, CS Lewis said to break an evil spell, let’s say it’s an evil narrative, or it’s not true, you have to cast a better spell. And I guess the question right now is, where is truth? If you’ve got a global agenda right now, and Schwab’s pretty open about it. We’re going to tell a story that everybody’s going to buy into, and that way they’ll march in step with it. No different than any other revolution, going back to communism or what have you, you have to have a march-step kind of agenda or narrative, is the story.
David: Yeah, I mean, on the surface Ukraine looks like one thing, and it may very well be just that simple. I’m just not convinced that it’s a mere coincidence that we’re seeing a variety of things happen. I mean, this does have to do with power players and larger agendas and narratives which have to be told, and who’s going to be designing those narratives? I mean, just this week we’ve got the European community rolling out their equivalent of the Belt-Road Initiative. It’s their response to the Chinese, who are going to spend trillions of dollars, and this week Europeans said, “We’re going to spend $300 billion, and it’s going to be our version of developing infrastructure.” Ports, data, roads. And again, it’s to directly compete with the Chinese. People are realizing that things are shifting. Who’s going to be in control post-shift? Is it the technology giants, is it the Chinese, is it the Russian influence through the dependencies they’ve created through Nord Stream, or should we immediately put the brakes on and not follow through?
Kevin: Or will it be the Great Reset, Schwab, World Economic Forum? Who wins in this? And I think what they’re looking for is something that they’re, a story that would be accepted universally by everyone.
David: There’s more complexity, is I guess what I’m getting at. And I think I understand a few things, and I’m also recognizing that there’s a lot more complexity immediately under the surface. And what we can’t afford to do is somehow have that complexity swept away. Streamlined narratives that have near-universal acceptance. They’re generally the narratives you’re supposed to see, supposed to see as credible, and easily believe without question or without the stirring of cognitive dissonance. So we’re talking about crafted truths, created with the classic tools of propaganda, conveniently guiding the viewer to a desired conclusion, right? And what that neglects, what that neglects is anything that would discredit the narrative, right? So alternative explanations run counter to the coherence of a particular narrative. So there really is no room for discussion, there is no room for debate. Media is today very complicit in this. And you report on topics, it favors a particular point of view, it neglects how it could’ve been seen otherwise, right? I mean, think about this. If you have something that makes the news cycle, if you have something that makes the news cycle, it was approved by a producer.
Kevin: Dave, I’ve got a personal story on that.
David: I mean, did you know that? I mean—
David: —there is nothing that makes the news cycle that wasn’t approved, which means there’s an equal number of things that they said, “We’re not talking about that.” Why?
Kevin: Yeah. And I’ve got a client I was talking to, Dave, he’s an executive in the sales side of a major national network. And he was in the studio when the producer was cutting things that he knew should be said. And we talked, and he said, “You know, Kevin, I just don’t know how much longer I can do this.” He was contemplating retirement for two reasons. One of them had to do with the vaccine, but the other one was he was in the studio watching the process that you just now brought out. And this, this is a major network that you would think would actually report more facts than not.
David: Yeah, so if we’re driving towards a preferred conclusion, a preferred narrative, and again, we’re sort of curating the required facts to support and buttress it. The facts are the facts, right? To some degree, to some degree. But it wasn’t that long ago that debate, debate was invited. Public debate, it’s largely dead. Now today you’ve got ad hominem attacks, which, they’re really all that remain in the public square. This was really disappointing as we watched the presidential debates. It was not like one side was better at it than the other in terms of getting to a discussion of relevant facts relating to the issues in play. No, I mean, it was a spectacle. The last two presidential debates have been 100% spectacle. Ad hominem attacks, and you don’t see much better. Frankly, you’d think, “Oh, well that’s politics.” You don’t find much better in academia. It’s discredit the opponent, we’re not here to talk about the truth, I’ll give you what the truth is in a moment. It’s no better than private discourse either. So in the world of ghosting, or social media annihilation, you get discussion and debate, which all that does, those are just factors that unhinge. If you’re going to discuss something, if you’re going to debate something, well, that unhinges the already-settled issues. And I think that’s where, when I hear the Schwab notion of we’re moving from a Reset to a Great Narrative, I think, “What kind of reality needs to be defined, we all need to sort of get in line with?” Are all issues settled? I thought all issues were up for discussion and debate. But this is maybe the delusions of a philosophy student.
Kevin: Well, and maybe, what I had mentioned before, in conversations that I’ve had with people just recently, where they were very honest. One person in particular said, “No, don’t give me the facts, I’ve made up my mind.” Do you think it’s possibly not just consensus, but certainty? People are craving something simple and certain so that they can go about their lives?
David: I think that’s definitely a part of it. Better the determined, better the internal comfort derived from the known versus the unknown. We like the predictable better than the undetermined, even if that costs us something in terms of freedom of choice, and the tensions of the unknown.
Kevin: But it might threaten the universal narrative. If you’ve got a narrative that’s to be universally accepted as consensus, if you’re asking a question, that just destroys the— Well, it challenges the story. Builds tension, doesn’t it?
David: One of the things driving the conversation we have today is, again, you mentioned Vaclav Havel, The Power of the Powerless, October 1978. It’s worth reading because dissent is one of the topics. Dissent from what is the accepted narrative. And in his day, there was an accepted narrative, and dissent was just an opening conversation. And as an artist, he said, “Why can’t we talk about lots of things? I thought there was value in plurality. You’re telling me there’s only one way. As an artist, why can’t I explore another way?”
Kevin: He asked the question that everybody could have. It reminds me of a Gary Larson cartoon, you know, the Far Side. You’ve probably seen it, there’s 1000 sheep in the picture, and then there’s one standing up, spreading his arms, and he’s like, “Wait a second, we don’t all have to be sheep.” You know, that’s true, I mean, really, all you have to do.
David: That was Vaclav Havel. And then all the sheep turned around and said, “Fine, you be president.”
Kevin: After going to prison.
David: Right. So I mean, sometimes you know when an agenda is in play by the intolerance for questions and the lack of real engagement on different perspectives. You can even see this in the way that schools have approached teaching style, known as pedagogy. So teachers used to teach in the old Socratic method, opening minds with question after question. And that’s still a guided method, I grant you. But now it’s more of like, “Here’s what you’re going to learn,” and it’s more of a dictation of facts and an organization not around discussion, but singular truths and what feels to me, looks to me to be more indoctrination.
Kevin: It almost reminds you of cultic religious truths that are forced onto people. You either buy the whole package, or you’re not in.
David: Yeah, and I mean, listen, I think any religious organization can be accused of this with some degree of accuracy, that indoctrination, central to propagation. The issue is religion today is not religion. Religion today has many secular expressions, with indoctrination and intolerance of alternative narratives a common mode of existence. So back to this notion of Vaclav Havel and the importance of pluralism where dissent is critical to social health. Pluralism has died a gruesome death, and its killers, ironically, were once pluralists themselves.
Kevin: Yeah. Isn’t it strange how the ideology that creates the new system ultimately becomes the enemy of the new system? Dave, I just keep going back to what your wife, how she grew up, when the word switch would come up, you’d have to take the other side. I’m going to throw a challenge out to myself, to you, and to the listeners. How about once a day, maybe write it on your to-do sheet. Once a day, write the word switch, or put it down, and once a day, challenge one of your cherished beliefs. Argue the other side. Wouldn’t that be an interesting— I’m talking even just with yourself, just as a debate with yourself just to say, “Okay, I have taken this for granted, now switch,” and see what happens.
David: This is the point we started out with. We can argue for a bear market in equities. We can argue for putting in a major top in the financial markets.
Kevin: Now, switch.
David: Now we need to argue for a bull market in equities. And that’s a healthy exercise which takes you deeper into your understanding of potential missteps and flaws in your own thinking. And so to be able to do that and look at things not from the standpoint of sort of doctrinaire acceptance on any issue, and that’s the point. I’m not trying to stir a dozen hornets nests today, but just to say, if we can step away from even our own doctrinaire— what we have considered to be the accepted— our own narrative, not given to us from the outside, but one that we’ve created ourselves. How do we switch?
Kevin: Well, and you talk about going deeper. The human experience shouldn’t be just about facts, it should be about empathy, and about love. And if you are used to taking the switch side, maybe at some point you’re going to have a deeper opportunity with the person who maybe is on that other side.
David: We’re going to attach the article, the small book, pamphlet, whatever you call it, The Power of the Powerless, because it’s profound to read, it’s a lot of work to get through. But as you go through it, you’ll see common elements. As you often do in literature, there’s things that are relevant from 100 years ago, 500 years ago, 1,000 years ago, 4,000 years ago. To the degree that you’ve delved deeply into literature of the past, you can see an echo of that into the present.
And so just as Don McAlvany said so many years ago, “Always mistrust the obvious,” it’s really a call to look beneath the surface, to dig a little deeper. If that’s with a better historical perspective, if it’s through a slightly different lens, if it’s, as you said, Kevin, with greater empathy for the person on the other side of the argument, it’s very valuable.
So as you head towards Christmas, consider this one of your assignments. Before you sit down at the table, before you sit down at the table with family, and people are discussing somewhat controversial topics, perhaps you can see what he was arguing for in this article, the power of dissent, the importance of dissent, and the justification for multiple voices sitting around the table.
You think, “What is a celebration of pluralism? Is that a potentially bad thing or is that a potentially good thing?” I would suggest that if we don’t have the opportunity to explore pluralism, we’re in a world of hurt. And it would appear that that’s the trajectory we’re quickly moving towards.
Kevin: You’ve been listening to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany. Be sure to get us your questions, we’re going to be answering those questions over the next couple of weeks. Send those to firstname.lastname@example.org, that’s spelled M-C-A-L-V-A-N-Y.com, and you can call us at 800 525-9556.
This has been the McAlvany Weekly Commentary. The views expressed should not be considered to be a solicitation or a recommendation for your investment portfolio. You should consult a professional financial advisor to assess your suitability for risk and investment. Join us again next week for a new edition of the McAlvany Weekly Commentary.