George Gammon was recently on episode 1408 of The Creating Wealth Podcast and discussed how the coronavirus, corporate bond market, and the oil market could lead to the “everything bubble” turning into an “everything crash”. See the full interview transcript below.

Introduction 0:16
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s actually been there and done it. He’s a successful investor, lender, developer and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day. You really can do it and now here’s your host, Jason Hartman with the complete solution for real estate investors.

Jason Hartman 1:06
Welcome to Episode 1408 1408, as Rome is burning, well, I don’t Well, maybe I do mean that a little bit. Anyway. Okay, listeners. So the world is in a bit of a crisis mode. Certainly you have noticed. And we have a good guest today. This will be a two part show, or part one of a two part show. Part Two will be played tomorrow for you. My friend George gammon is back. He has done quite a bit of research and quite a few interviews with experts on economic impact, and the health impact of Cove ad 19. So we’re going to talk about that today. And I think you will definitely want to hear everything that is said throughout this show in tomorrow’s episode as well. Couple things though. Number one, I’m going to be talking about my projection my estimation of the impact on Airbnb. And I think you’ll want to hear that that’ll be upcoming in a future episode. Very important stuff. Given that we see the convention business collapsing all around the world cancellations galore. As you know, we’ve postponed our meet the Masters conference, our 22nd anniversary meet the Masters was scheduled to be in early May. And we have postponed it. And hopefully we will have a date this summer for that event. Again, it’s in limbo right now. Because nobody knows the impact of this thing. It is just too hard to tell. It’s very hard to estimate. But as we see that happening as we see airlines, just shutting down thousands of flights and we see the cruise ship business basically over Before a little while here, you know, everything will ultimately return. But this is definitely a time of very difficult transition. And a lot of the supply chain has affected a lot of businesses, a lot of industries affected very much a time to be paying attention to this. So I want you to remember something now. Okay, first off, the coronavirus is not a drill. Be careful what you are letting influence you on this. There’s a lot of falsehoods spreading around social media, making light of it like it’s no big deal. And I think this is kind of a big deal. Okay. You’ll hear more about that during this interview. But the other thing I want you to know is as we see financial markets struggling as we see the oil market collapsing, huge impacts of all of this stuff, obviously, just over 10 years ago, during the Great Recession, the worst economy in seven decades. A few things number one, so much people consider the day of the start of the Great Recession, the day that Lehman Brothers collapsed. So just keep this in mind. I’ve said it before, but not for a while now. So maybe you haven’t heard me say this, the day before the Lehman collapse. You went to sleep. And the world had a certain amount of assets. It had a certain amount of real estate. It had a certain amount of companies and businesses. It had a certain amount of gold, silver, platinum, palladium, it had a certain amount of oil. It had a certain amount of land, it had a certain amount of everything, right? those assets were there. And they were all quantifiable, and everybody could count them. And then you woke up. And that next day, you heard the news of Lehman Brothers collapsing When most people think the Great Recession, the worst economy in seven decades began. Okay. Now, after you heard that news, You looked around the world, guess what, there was the same amount of real estate, the same amount of gold, the same amount of platinum, palladium, silver, the same amount of oil in the ground or out of the ground. There was the same number of companies. Almost, there wasn’t Lehman Brothers, and some other companies failed to obviously. But generally speaking, right, the world had the same amount of assets before the Great Recession. And after the Great Recession, the only difference was the Fiat value. Or, to put it another way, the nominal value of those assets and and who was the owner of those assets, right? Because when the Great Recession occurred, some of the ownership changed hands Right. And, you know, as is usual throughout history, the rich get richer and the poor get poorer. Okay. Sadly, that’s the way it works. And the nominal value or the Fiat value of those assets changed, right? In other words nominal the definition for that, again, is in name only. Nominal means in name only. And Fiat means by authority. You know, everybody talks about fiat money, right? Well, it’s by authority, right? It’s by decree because there is a law, okay, the legal tender laws in the United States and other countries they have, you know, different laws, but this concept remains that says the almighty US dollar is good for all debts, public and private. If you don’t believe me, pull it out of your wallet and read what it says valid for all debts, public and private, right. So the legal tender laws are the Fiat authority that give the currency with You know, no specific real value since 1971. They give it its value. It’s the law, right? The law gives it its value, the Fiat, the authority of the law. And nominal in name only right? means that, you know, the name, the value name, right? In other words, if Lehman Brothers stock and I have no idea what the number was, but if Lehman Brothers stock was worth $50 a share, right? And by the way, this doesn’t matter if the company is public or private, because they’re still shareholders, okay? There’s either one shareholder, or there’s a whole bunch of shareholders and they may have a private ownership or they may be public doesn’t matter, right? There’s still a share value with every company. So maybe the shares were worth $50 each and there were, you know, a bazillion shares out outstanding. And then after a collapse, the shares were worth zero. So, that was the nominal value, right. The name of It Right, but all the basic assets in the world were still there. So I guess I’m saying this to say, Look, don’t panic, life will go on, okay, things will definitely happen. This is not a drill, this is a serious thing. There will be huge opportunities created out of it. Now, during the Great Recession, when I was talking to I was talking to about the contrarian event investors I was talking about, you know, the way those investors were being opportunistic, you know, some might call that vulture capitalism. There will be opportunities. There are opportunities now, because guess what, maybe real estate prices haven’t changed. But guess what, got cheaper Money, Money got cheaper last week, and you know what, it’s probably going to get a little cheaper again. Okay. So that money is a huge asset. What I mean, there of course, is the mortgage money, right? I mean, mortgage money. So huge opportunities always created. And that’s why you’re listening to this show and following my work, because I have helped thousands and thousands and thousands of people make. I don’t know how much money but lots of it, okay, I hear about it all the time. Even, you know, back to my career in traditional real estate for 19 years before I spent the last 16 years in the investment side of the business. That’s what I do, right? Everybody does a different thing. What I do is I help people make money and create wealth. That’s my job. We’re going to help you do that through this whole thing. So keep on listening. Listen to the show. Listen to tomorrow’s show, listen to all of them. Go back and listen to the back catalogue. If you’re new to our show, be sure to check out the Jason Hartman quickstart podcast on any podcast platform, just type in Jason Hartman quickstart and you’ll get some of the more fundamental information there. Here. You’ll get more news information. And strategic information as events unfold, obviously, that’s what we’re doing today as well. And if you want to talk to one of our team members, our investment counselors, they’d be happy to help you do a portfolio makeover. Position your portfolio to protect your wealth and grow your wealth through these. As the old Chinese saying goes, may you live in interesting times, and these are definitely interesting times. So that’s what we’re here to help you with. And you can reach us at one 800 Hartman, that’s one 800 h AR t ma n. Or of course, Jason Hartman, calm. Let’s go to part one, as we talk to George about what’s going on in this crazy world.

It’s my pleasure to welcome my friend George gammon back to the show. I asked him to come on today to talk about the impact of kovat 19. The surveys of sickness maybe coronavirus. It’s not something to laugh. All right, George. But anyway, that’ll help us from not getting D monetized. And we want to talk specifically about the concept which is very rare as an economic malady. You know, I talk about the three economic maladies all the time, inflation, deflation stagnation, but this one is it’s kind of interesting and nuanced and rare and very disconcerting to because since we’ve had the markets really recognize the impact of coronavirus. We are in a position where we are beginning to see a supply demand shock and this is a rare malady. So I want to talk about that but we’re going to talk about a bunch of other things I think will go on a lot of tangents today. For you who are only listening on audio. We will also put this on our YouTube channel because George is fantastic with the visuals with the whiteboard and we will be showing some of his whiteboard segments here in order To elaborate on what we’re discussing, but hopefully it’ll come across really well for you if you’re just listening to the audio as well. George, welcome back. It’s great to have you.

George Gammon 12:09
Thanks. I appreciate you inviting me back on. It’s always a pleasure to talk.

Jason Hartman 12:13
Yeah, it sure is. And these are scary time, the markets. Finally, just about a week and a half ago, I really started recognizing the impact of this very serious thing. And just to talk about it for a moment before we get into the economic impact, which is significant, when we’re going to hopefully impart to our listeners some things that can really help them weather the storm. When it comes to the health impact. I think it’s important because so many people are spreading really false hoods on social media. You know, I look through my Facebook feed, I look through Twitter, and I’m seeing these people saying, you know, what’s the big deal, the flu kills more people, blah, blah, blah. That is not true. This is different. There are very Important nuances. And since you and I have both been doing a lot of research about it, I just thought I’d let you talk about that a little bit before we jump into the financial side.

George Gammon 13:08
Sure. The big difference between the coronavirus surveys of sickness whatever you want to call it in the in the normal flu, first and foremost is the are not value. So the are not value is just a scientific way of saying how fast does it spread from one person to a group of people. If one person has the virus, and the are not value is for like it is with the corona virus, then that one person is going to spread it to four people. Mm hmm. So, and then it just grows exponentially From there, the flu is 1.28.

Jason Hartman 13:47
So,

George Gammon 13:49
that is a huge, huge difference when you get into the exponential growth curve and the math of it and to get a virus to where it just self extinguishes you ones that are not valued at one or lower get lower than one. And it’s just going to fizzle out because that one person isn’t passing it on to enough people in order for it to grow. So that’s the first big difference. The second big difference is the serious complication rate. So you’ve got something that grows much, much faster, four times faster than the flu. But the amount of people that require a hospital bed are far greater. I’ve seen some studies and a lot of people that I have a lot of respect for, say that that can be as high as 20% to zero. So if you have something that takes three months, let’s say not even that, let’s say it takes two months to go from zero infections to a million infections in the United States, and 20% of those people call it 200. Thousand need ICU beds? Well, we’ve only got 100,000 in the United States, right? So even if the death rate is around two or 3%, which is still a lot higher than the flu, sure, but it seems like okay, this could be manageable. But that’s if you’ve got full capacity in your hospital system, right? If that strained at all, obviously, that 3% is going to go up to 6% 10%. Who knows, and there’s places in Italy. And so it’s this is not like a third world Eastern. Oh, it’s not going to affect this type thing. If you look at Italy, you see several stories of doctors and nurses saying that there are 200% capacity and it’s gotten to the point there where they have to make some very difficult choices. What I mean by that is if you’ve got two people coming into the hospital, 170 years old, and one is 40 or 30 years old, you’re really gonna have to decide, okay, we’ve only got one bed. Mm hmm. Who do we send away and potentially let die? And who do we treat? And that’s what it’s most unless we get a miracle, which obviously we’re all praying for.

Jason Hartman 16:14
I mean, Earl Berlin has some possible good news or Chris martenson was talking about that. He’s been on the show a few times before. There may be, you know, let’s all hope for a miracle. But go ahead. Yeah,

George Gammon 16:25
yeah, if we see the numbers play out in the United States, like they’ve played out in Italy, and unfortunately, because the United States isn’t taking this seriously, just going back to what you’re saying, with all your friends on Facebook or, or Twitter who just say, Oh, it’s just the flu. What’s the big deal? The flu kills 80,000 people a year and the coronavirus is only killed 100 this is all just media hype. Those people are going to get a rude awakening in about three or four weeks because Well, I’m not gonna say it’s gonna happen. But unless we get that miracle, I think it’s probably going to play out even worse in the United States than it has in other areas just because we’re so nonchalant about it. Well, not not

Jason Hartman 17:13
only that, you know, we’re really, you know, America is the land of the land of the free in the land of the rugged individual, right? And Americans don’t like being told what to do. You know, they look at it as government oppression and, and, you know, China, I have my friend who lives in in China just on the show, as you know, and the one thing you can say about a one party country that’s argue whether it’s Communist or not, that’s debatable in some ways, but it is efficient, you know, they can put the country on lockdown, and people are going to listen, okay? There’s only going to be a few outliers, but in a country like the US where everybody’s so like, freedom is like in drenched in their soul. They’re just gonna break the quarantine. They’re not going to listen, if that ever happens, right? And the likelihood of the government doing it is going to be lower. Hear. So there are some times when all this you know, freedom was great. It works against us, right?

George Gammon 18:06
Yeah, there’s a downside. Obviously, as a big libertarian myself, I would say the upsides better. But in situations like this,

Jason Hartman 18:15
by the way, I should mention, when George picked me up at the airport in meta gene a couple of weeks ago when I was there, he was wearing a gatson flag hat. That’s how libertarian Georgians, okay,

George Gammon 18:28
back and forth with that one in the hashtag and the Fed well,

Jason Hartman 18:31
and well, and then you also have to iron ramp hats that I noticed in your house. Yeah. So Georgia’s a bit of a libertarian for sure. Go ahead.

George Gammon 18:41
Yeah. But there is an advantage to that, like you’re saying, and I think when I mean nonchalant, what I more specifically we’re not testing and like South Korea, they did a lot of testing. Singapore has done a ton of testing. And so you know that hey, I’ve got the virus. Yeah, so I can self quarantine because you know that your 80 year old grandmother is much more susceptible. So you’re not going to go over there for the Friday night party, right just makes a lot of sense. But if you’re not testing, you can’t do those things. And going back to the math, that’s what brings that are not value from four or six all the way down to one where it needs to be. So this thing doesn’t go exponential. It’s just more linear.

Jason Hartman 19:27
Okay, so that the other thing is, this virus is tough. It lives outside of the body longer, and it’s more hardy than undesirables and it’s airborne. So, you know, they say you got to be six feet from a person to have a good chance of being protected. You’ve got to wear eye protection, a mask and certainly don’t touch don’t shake hands. It lives on fabric. It lives on countertops, it lives on doorknobs. If you ever thought about becoming OCD, this is the right time to become OCD. Okay.

George Gammon 19:59
Yeah. Not that it’s a joke, but I was thinking just Howard Hughes was a little ahead of his

Jason Hartman 20:04
time ahead of his time. Now this is, this is the time to act like crazy old Howard. Here’s Yeah. Okay, so we kind of covered that major health component. Let’s jump into the economics. markets have recognized this, they are scared to death. Events are being canceled all over the world. We postponed our meet the Masters event, by the way, you were one of the speakers at that event, I hope. I hope when we finally do, do the event, you can you can still come and speak to our audience or event planners, hotels, airlines, cruise ships, obviously are really suffering. But there’s a whole supply chain around the planet. And China is sort of at the beginning of the supply chain for a lot of products, right?

George Gammon 20:48
Let’s go over this. In 94% of the Fortune 1000 companies have part or all their supply chain coming from China.

Jason Hartman 20:56
Yeah, and many and Wu Han.

George Gammon 20:58
Yeah, that whole era. You got it. You got it. So this is something that can potentially affect worldwide supply chains, meaning that you could have a supply shock. So if you go back through US history, you look at oil embargo in the early 1970s. That was an example of a supply shock, right? If you look at Hurricane Katrina, in New Orleans, where you go down to the your local store, and there’s just nothing on the shelves, that’s an example of a supply shock. What we’re accustomed to in the United States is trying to battle demand shock. So we go through the great financial crisis, or the global financial crisis, and all of a sudden, no one’s spending money because no one can get credit, their asset, their main asset, their houses collapsed in value. So that’s no one’s out spending or buying things, but there’s still plenty of things on the shelves,

Jason Hartman 21:54
right? So here’s what’s interesting about that, George, and you’re probably gonna allude to this if I don’t say it, but we Have one of the central planners at the Federal Reserve and the government have tools to deal with that shock. They can stimulate, they can do more QE and just push money, they can flood the system with money. And that’ll cure some of that, because people will just take the money and go spend it. And then that’s resolved. But this is a rare Dual Shock that we’re really, we’re not facing it yet. But it’s early, we’re going to experience the Dual Shock, which is have some unique properties, right?

George Gammon 22:33
I’ve never seen anything like this in US history. If you go back to the major economic events, I’ve never seen a supply and demand shock, a huge one happen simultaneously. It’s not saying that it’s 100% guaranteed going to happen. But all the components are in place for it to play out within the next few months. So why demand shock Well, if everyone is staying in their homes because they’re afraid of getting sick if the whole country is on lockdown, like in Italy, no one’s going to these conventions. No one’s flying. No one’s going to Florida for their vacation. They’re not out spending money. They that’s the last thing on their mind. So that’s what creates this demand shock while at the same time. If you look at a I this really cool pictograph that I used in a video last week that showed the top 10 importers from China in the United States. So number one was Walmart. Number two, I believe was target. But you had Lowe’s, Home Depot, all these big box stores that the majority of Americans go to at least once a week, if not once a day, right? They’re getting the majority of their products from China. Okay, well, if China has been in lockdown mode and it takes 30 days to get those goods from China to the US nited states there’s going to be a big lag there. So we should expect to see supply shocks in the United States within the next month or two. And we

Jason Hartman 24:10
already if you want to know how that feels, you got a little taste of it already. And anybody who has gone to any Costco around the country guys reported to me and sent me photos of how all the water is gone. All the paper products are gone. I’m not quite sure why the toilet paper thing specifically, but that’s, I don’t know. I guess that’s the ultimate necessity item and water maybe. But um, but you know, we’ve never seen those shelves empty. I went to several stores over the weekend CVS, Walgreens, I could not find any hand sanitizer. No, it was and there were notes on the shelves yellow notices that said we’re out don’t keep looking around the store. Don’t ask our people for witches don’t have it. That in the hand sanitizer, the wipes, the water, the paper products. You’ve seen that? My friend told me he was talking to one Costco employees, and they said rice and pasta are the other things. They said when bags of rice come in, and they get pallets and pallets of the rice delivered to Costco. They’re gone in an hour that everything’s gone.

George Gammon 25:12
Yeah. So in that same video, I kind of did this thought experiment on how that plays out. And if we see that come to fruition in the United States, I think you’re going to have consumer prices on those items go through the roof. You can see him double, triple, quadruple in price, while at the same time, you see prices on higher end items completely collapse. Hmm. So you see car prices as an example completely collapse while at the same time. Price quadruples. Yeah, okay. Interesting. Okay, take us through a little this video, if you would, you’ve got your whiteboard on the screen. Now. For those of you listening on audio only we’ll elaborate on this. A little makes sense to you. Go ahead, George. Okay, so what I did in yesterday’s video, which now has 60 70,000 views it was really popular is I went through how the corporate bond market and the credit markets are affected by this crash in oil by the corona virus. And by this, call it everything bubble turning into an everything crash, and they all are connected. And I don’t think most people realize this. And when it comes, especially when it comes to the corporate bond market, I think people are just whistling by the graveyard. And this is really the center of everything, and everything that could go wrong if it gets really bad in the United States. So I kind of outlined what the corporate bond market is, how it works and why it’s so important. So if you’re looking at this whiteboard, you see this circle Which is kind of indicating or representative of the market and you see the line that’s call it separates the lower 15% from the upper 85%. So below that line is junk credit or high yield credit that’s corporate credit, like a Tesla, or an Uber, that would be considered high yield or junk, because the credit ratings don’t give it a triple B. That’s the line in the sand between investment grade and high yield. Okay, yes, junk bonds. Yeah, so that’s very important that line in the sand. In the junk bond market, you’ve got about 1 trillion a little over a trillion. They’re just in the triple B, which is kind of the first step. In the investment grade, you’ve got $4 trillion of corporate debt, so that would include Companies like Ford, IBM, Heinz, at&t, that it really loaded up on corporate debt to buy their own shares back over the past 10 years.

Jason Hartman 28:13
Okay, so let’s talk about that for a moment. So a lot of people have been saying that the reason the stock market or you know, one of the reasons the stock market has just been setting, you know, records and it’s just been incredible is the share buybacks, right. So companies like at&t, Ford, Heinz, etc, etc. There’s a whole bunch more, of course, have been borrowing. They’ve been doing bonds right to to buy their shares back in those bonds, which might have been triple A are now triple B. And as you go down that ladder, the next step down is the high yield or junk bond status.

George Gammon 28:51
That’s correct. And the big reason that’s important to understand because the pension funds have been supplying the majority of of this liquidity or cash to the corporate bond market. So, taking it even a step further back why they’ve been doing that, because the Fed dropped interest rates to zero for so long. And these pension funds have to have a 7% return to meet their liabilities. So if you can typically go into a 10 year Treasury and get five or 6%, well, it’s not gonna be that hard for that pension fund to meet their obligations. If you can only get one or 2%. On a 10 year Treasury. Now you’ve got real big problems. So the pension fund managers said, Well, what do we do? Let’s go somewhere where we can get a little bit more yield. Let’s go into the corporate bond market. So I want to be clear that that was a result of the Fed policy, it was an unintended consequence of what the Fed did. So the pension funds take all this cash, go into the corporate bond market, the corporations to To your point, take that money, what do they do with it, they just buy their own shares back. Because it’s just this financial engineering where the CEOs can pay themselves more than it looks like their earnings per share goes up. But all they’re doing is just borrowing to buy something that gives them a sugar rush. And at some point in time, they’ve got to pay the Fiddler. If their cash flows stay consistent, like with at&t, then, okay, they might be able to service that debt, not a big deal. And what most of the bowls point out is that well, the cost of servicing that debt is extremely low right now, because of this low interest rate environment. But what they’re not saying is that it’s that debt rolls over. And a lot of these corporations have to roll it over every two years, every five years. And then they’re assuming that their cash flow stay consistent. Well, like you know, and I’m sure a lot of your listeners Know that in a recession or in a depression, the cash flows of these companies plummet. So if you have a situation where the cash flows are plummeting, and the stock market is going down, so that’s creating this situation where a lot of their debt, meaning those corporations is getting downgraded into junk, which means the interest rate on that debt goes through the roof, like oh,

Jason Hartman 31:34
like what, what is through the roof mean? How, what’s the differential there? I mean, of course, it varies by company and such. But give us an idea.

George Gammon 31:43
Well, if this plays out, I think it could double easily.

Jason Hartman 31:46
So the debt load or the cost of servicing the debt doubles for these.

George Gammon 31:52
I mean, let’s just look at it like a mortgage. I think that’s the easiest way to describe it. So you’re a real estate investor and You take out your buying $100,000 home, and you’re taking out a mortgage. Let’s say your interest rate is 4%. And your monthly payment is x. And after you do all the math, you’re $200 cashflow positive. And as your listeners like because they’re smart, they take out fixed rate debt, so they don’t have to worry about these things. Right. But the corporate bond market isn’t 30 year fixed rate debt. It rolls over.

Jason Hartman 32:29
The big companies don’t have Fannie Mae and Freddie Mac subsidizing their owns. Yeah, no, they don’t.

George Gammon 32:35
So when that debt rolls over, if it’s now called 8%, you can imagine what that would do to that positive cash flow that you had in that rental property. Now, all of a sudden, you’re probably cashflow negative. Yeah, right. And that’s just in a, that’s a microcosm of what’s going on in the corporate bond market. In addition to that, taking it back to the real estate exam. The Corporation’s cash flow gets slashed. So imagine having a rental property where your interest rate on your mortgage doubles. But your rent goes from $1,000 a month to $400 a month. And that’s the situation and then you take it a step further. And the entire real estate market has been built on real estate investors invite buying more real estate properties, right?

Jason Hartman 33:34
Yep. And what you’re doing is you’re just making the comparison with the stock market and right and the large companies that have no stand that’s happening, I’m just using that as an example that most of your listeners can easily understand, because they’re real estate investors. So if the entire real estate market has been propped up by real estate investors going in and buying these properties because they’re cashflow positive All those buyers go away right? Then the real estate market drops plus the cash flows drop plus the cost of servicing the debt goes up. Right. You just have this. Wait a second, though before coronavirus. Everybody was talking about the everything bubble. Okay. And certainly about the stock market bubbles specifically, we have out of whack valuations before any of this started right with P e ratios in the stratosphere price to earnings ratios, where the stock market is like a cyclical real estate market. It’s like buying in in areas that we would never recommend like, you know, expensive West Coast of the United States markets are expensive Northeastern markets or Miami. You know, these markets just they were too expensive to begin with. They had completely out of whack price to earnings ratios, or in real estate, we use rent to value ratios, same idea and so now You add to it this situation with their financing getting a lot more expensive. And these companies are in trouble.

George Gammon 35:08
They absolutely are. But it’s not just these companies that are in trouble, because there’s a direct correlation between those companies and the overall stock market. And unfortunately, our economy has been so financialized Yeah, over the past 20 years, that now it’s the tail wagging the dog or where the stock market should be a reflection of the economy. Now, it’s not It has nothing to do with the economy, but the economy is completely reliant upon the stock market, because of demographics. Because of the baby boomers having their 401k they’re going to be taking that out. It’s all about consumer spending. It’s all about confidence. I’ve been saying this on Twitter in my videos a lot lately, that this whole system is built on confidence. And if that confidence goes, the whole house of cards comes crashing down. The main thing to understand with this is is the line, the 15%. And below is junk debt. The 85% above that line currently is investment grade debt and the pension funds can only invest in investment grade debt. That’s the key takeaway from this picture.

Jason Hartman 36:33
In other words, they’re restricted most of them but most of them, right. That’s right. Yeah. Right. And not to mention, we’ve profiled it on the show many times, but there’s a huge pension problem around the world, you know, not just in the US, but yeah, okay, go ahead. This will be continued on the next episode. Thank you for listening and happy investing. Thanks. Thank you so much for listening. Please be sure to subscribe so that you don’t miss anything. episodes, be sure to check out the show’s specific website and our general website heart and Mediacom for appropriate disclaimers and Terms of Service. Remember that guest opinions are their own. And if you require specific legal or tax advice, or advice and any other specialized area, please consult an appropriate professional. And we also very much appreciate you reviewing the show. Please go to iTunes or Stitcher Radio or whatever platform you’re using and write a review for the show we would very much appreciate that. And be sure to make it official and subscribe so you do not miss any episodes. We look forward to seeing you on the next episode.