This week on Stansberry Investor Hour, Dan brings back Cullen Roche, one of his "favorite people to talk to," for a third interview.

The reason?

Cullen has a knack for understanding complicated market topics... and then breaking them down into straightforward, digestible explanations. Proof of his prowess lies in his prolific writing career. He has written for scholars and the everyday investor alike – from a top 10, all-time most-downloaded research paper to a highly rated book and weekly posts on his popular blog, Pragmatic Capitalism. All of this is anchored by his years of experience running his own investment partnership before founding Orcam Financial Group.

Dan and Cullen's last talk took place during the first innings of the COVID-19 pandemic, not long after the government passed a $3 trillion stimulus package. Now they're chatting again – this time, to address the trillions of dollars more that has been pumped into the economy since... and to explain why we're seeing historic inflation rates today. As he tells Dan...

We ran multitrillion-dollar programs for consecutive years in the last two years. So these programs were gigantic – they were so much bigger than anything we did in comparison to 2008. And the resulting impact has been a lot more inflation.

As the Fed readies to "tap the brakes" on its quantitative-easing programs, an unimaginably wide range of potential outcomes exists for the markets. However, one thing is certain: Years of volatility loom ahead. So for investors looking to build their own "all weather" portfolios, Cullen shares some portfolio-designing tips – many of which are near and dear to Dan's heart.

For a fresh perspective on the inflationary crisis and wisdom on the best way to survive it, sit back and enjoy Dan's conversation with this returning Investor Hour favorite.

Recorded Voice: Broadcasting from the Investor Hour studios and all around the world, you're listening to the Stansberry Investor Hour. Tune in each Thursday on iTunes, Google Play, and everywhere you find podcasts, for the latest episodes of the Stansberry Investor Hour. Sign up for the free show archive at investorhour.com. Here's your host, Dan Ferris.

Dan Ferris: Hello, and welcome to the Stansberry Investor Hour. I'm your host, Dan Ferris. I'm also the editor of Extreme Value published by Stansberry Research. Today, we'll talk with Cullen Roche. He's really great at explaining complex macro issues and that's what he'll do for us today. In the mailbag today, questions about gold, free cash flow, trailing stops, and a lot more. And remember, you can call our listener feedback line (800) 381-2357. Tell us what's on your mind and hear your voice on the show.

For my opening rant this week, we'll talk about balance sheets, as I promised to, and once again, the Russian invasion of Ukraine. That and more right now on the Stansberry Investor Hour. So I promised to talk about the "Five Financial Clues" and we've talked about free cash flow, margins, and today we'll talk about balance sheets. And this is going to be real quick. There's two kinds of great balance sheets, right? The balance sheet shows you the assets and liabilities of a company. It's, you know, you do this in your own life, right? You know how much debt you have, you know how much cash you have in the bank, you know how much money you make. Boom, there it is.

So there are two kinds of good balance sheets defined. One of them is where a company has more cash than debt, right? Because you could theoretically pay off all your debt and still have cash left over. So that's a good thing. We all want. I mean, just think. If you have a mortgage of whatever it is, $300,000, and you've got 600,000 in cash in the bank, you're feeling pretty good. You're sleeping well. Same thing with companies. An example of the more cash than debt, a great one, a current one is Berkshire Hathaway. They just put out their 10-K and Warren Buffett put out his annual letter recently. And he made a special point of explaining why they have so much cash.

They have $144 billion in cash and Treasury bills. And yes, when you see Treasury bills on the balance sheet, it's just like cash... $144 billion in cash and $114 billion in debt. So they can pay up all their debts and have ideally speaking, $30 billion left over. And in Berkshire's case that $30 billion number is interesting because Buffett says that he and Charlie Munger, his vice chairman, have decided that they always want to have at least $30 billion in cash handy, at all times, just in case they get a big insurance liability that needs to be paid off.

So really you could say they have $114 billion in cash that they might use for some kind of an acquisition. It's a nice, little, tidy sum in the Treasury if they want to do something. So that's an example of that kind of balance sheet that's really good. The other kind of example is when a company has more debt than cash, but they make so much money that they easily cover their interest payments, right? So, I was just looking at the example of Starbucks.

Well, I'm just going to use round numbers, really round numbers, OK. Just call it $4 billion in cash, $15 billion of debt. Obviously there is more cash than debt there. I mean more debt than cash. A lot more debt, almost 4 times as much and you might want to look at that and say, whoa, whoa, whoa, wait a minute, I don't like that. But I promise you, it really is OK. One of the things that a banker would look at in this situation is he would look at the equity value of the company and the company's market cap is over $100 billion. So, that's pretty good. Or it's around $100 billion lately. I don't look at price quotes and market caps every single day. And I encourage you to do the same. Don't be too obsessive about looking at that stuff. But anyway, so you got $15 billion in debt, $100 billion in equity.

A banker looks at that and says, oh, OK, that's good and like a bondholder or somebody, a debtholder or a potential debtholder. That's the way they tend to think about that. So you look at this and you think, hmm, how do I think about this? How is this good? Well, it's good because they earn like, their EBITDA is like just call it $9 billion or so EBITDA. And then if you go down and you look at their interest expense for the last 12 months, it's like not even $500 million. So they got it covered. They got it way covered, 16 times over, that's a lot. So it's fine. It's a really healthy company, Starbucks. It's a great business. The coffee probably costs a buck and they sell it to you for $5 or $6, it's a really great business. So, that's how I think about that. Those are the two kinds of good balance sheets you can have. And it really is that simple.

I'm just looking for that. We'll talk a little bit, we got a good question about free cash flow. And the question is asking us to take a little deeper dive into it. I'll do that in the mailbag, but if you have any questions about balance sheets, send them in to feedback@investorhour.com and I'll answer them on the show. The other thing we want to talk about this week, again, is the Russian invasion of Ukraine.

And I'm taking my cue here from Lodewijk H. Longtime listener and frequent correspondent who's asking "How can we anticipate this? What should we do? Should we buy precious metals and just hang on to them? How do we handle this?" And he says, "Neon is of very high quality, is made where they're fighting in Ukraine, and that's a problem for the semiconductor industry and palladium, a very high quality, is made in Ukraine." That could be a problem. And then he says, "With the country on the verge of military collapse, what do we do?" And he says, "Also, wheat, gas, and oil reserves being destroyed."

"It's going to be a terrible year," he says. How to anticipate this? Well, all I want to tell you this week, and what I told everyone in my most recent Stansberry Digest is, look, if you're George Soros or Stanley Druckenmiller, you care about these things a lot, right? You're looking at macro issues and you know all kinds of people who can tell you all kinds of things and you're super smart or whatever, and this is just your strategy. So if that's you, God bless.

You don't need me telling you anything. Otherwise, the idea that just a run-of-the-mill ordinary investor, like you and me, and I promise I am fairly ordinary, we do ourselves an injustice. We make a big mistake by always reacting to big headlines. Just because this war in Ukraine is in the headlines every day, and I mean, all day 24/7, can't get away from it, does not mean that you need to do anything special in your portfolio.

It doesn't mean you need to sell this kind of stock and buy that kind of stock or buy more of this and sell more of that. If you just think about oil, the obvious one, it's spiking up, it's spiked up again when it opened this past weekend and so what do you do with that? So what if oil's $130 a barrel? You think it's going to $230 or $200. We already know about this. It's already priced in, as they can say. Look at oil and gas stocks. They've soared.

The time to buy oil and gas stocks, the time to buy any commodity company is when they're cheap. When they're hated. When no one wants them. And I think that time has passed for oil and gas companies. They're not cheap and they're not hated, and everybody wants them. So be careful! Be careful jumping onto a bandwagon is the easiest way to put it. Don't assume that because something big is happening in the world, something big needs to happen in your portfolio.

And of course my assumption is that your whole holding something like maybe you have a 401(k), it's got an S&P 500 fund in it. You just keep contributing every two weeks or whatever. You don't need to do anything different. Maybe you're managing your own money and you're buying your own stocks individually and you own a bunch of really good businesses like Berkshire Hathaway and Starbucks and Costco and all kinds of wonderful stuff. Do you really think you need to do anything different with those? I don't think you do. They've got great assets, great management. They're pounding out money, as Charlie Munger likes to say.

And they're some of the greatest businesses, not in the world today, but that have ever existed at any time in the world. So if you own those kinds of stocks, I don't see how you need to do anything different. And all of this, of course, you run your own money. I'm just telling you what I think. But I haven't bought or sold anything in my 401(k) and I haven't – I think I sold down. I have a speculative account that's really small, that I'm in it all the time. I just have this small amount of money that lets me do any dumb thing I want. And the most I can lose is a small amount.

And I haven't even done much with that. It just has a bunch of put options and a few and gold stocks and silver stocks and I haven't done anything with it. I think I sold a little bit of, just a very little bit of puts, but I still have a huge position. I still have like 85% of it. And I sold a little bit of gold call options, but I still have like 80% of that. So, I'm not really doing anything. I'm not changing anything. If you're the kind of investor who wants to change things based on what's happening in Ukraine, you don't need to talk to me.

If you're that smart and you're that nimble, go for it, man! You don't need me. You get what I'm saying? I hope so because that's all I have to say about it. Just be careful. All right. Let's talk to Cullen Roche. Let's do it right now. My colleague, Dr. David Eifrig, who goes by Doc around the office, first warned we were at the beginning of a brand new inflationary era, nearly eight months ago. But it's clear the war in Ukraine could now make it much worse. Gas prices just spike to $3 and 61 cents a gallon nationally with projections of its soaring from here.

The Washington Post admits this conflict will likely "push U.S. food prices even higher." And Michael Swanson, Wells Fargo's chief agricultural economist, warns that these events "Are proof that this will be a multiyear issue. This is not something that will be resolved in weeks or months." But there's much more to the story because Eifrig worked in the financial markets for four decades and he's gone on record saying he's never seen a crisis quite like this one before us today.

And it's why he's making it his personal mission to ensure his urgent message reaches my investor radio listeners today. His mission is to open your eyes to a few critical decisions you should make immediately, which could affect you, your family, and your money for many years to come. For the full details, Doc has posted a free presentation you should watch as soon as possible on messagefromdoc.com. That website again is messagefromdoc.com. messagefromdoc.com. Check it out.

Cullen, welcome to the show. Good to have you back.

Cullen Roche: Hey Dan, it's awesome to be here.

Dan Ferris: Yeah, it's been a little while. I think it was like last summer the last time we talked to you.

Cullen Roche: Yeah, I think it's been summer of like 2020, I think. Right when kind of COVID was just really starting to flare up.

Dan Ferris: Right. So yeah, quite a while. So we need to check back in with you and I'm afraid you might have to put on your hazmat suit for this conversation because we're going to be talking about money and the Fed and things. That's why I wanted to talk to you. Because to me, it's such a sloppy topic. There's still this persistent narrative that Fed money printing causes inflation. You see a lot of references to that chart of the balance sheet, just sort of up and to the right, and then the next sentence will be CPI of 7% or whatever. And that's not quite the way it works.

And I'll tell you how I'm thinking about this. I don't know if you ever read much about Richard Feynman, the physicist. He had this thing, like he said, if you're going to teach kids about science, you don't want to use words like friction. They say, why do my sneakers wear down? Don't say friction. That doesn't mean anything. What means something is if you say, well, there's little pieces of the pavement sticking up and they grab a hold of the rubber on your shoes and rip it off.

And they rip tiny little pieces of rubber off every time you walk and eventually it wears away. And that's the kind of explanation that I'm trying to get out of somebody for how the Fed really – for example, the common narrative is that they're holding up the stock market, which I'm still scratching my head as to how they do that because I can't draw a straight line. I can't do the Feynman explanation. So I need some of these explanations of the mechanics of this. What happens when the Fed prints money and buys bonds and does it or does it not cause inflation?

Cullen Roche: I'll try. I'm no Richard Feynman, but I'll try to give you – I'm good at dumbing things down because I'm kind of a dumb guy. So like I need to really simplify things to be able to understand them myself. So like I'm pretty good at dumbing things down. But the thing that, I think the explanation that I've found is pretty intuitive for most people is thinking in terms of, especially quantitative easing, it's like exchanging a savings account with a checking account.

So let's go back to where the asset expansion really occurs, which is when the government runs a deficit, when the government spends, when the Treasury spends more than it taxes in, they expand their balance sheet. The overall balance sheet of the overall economy expands because the government is now essentially taking on credit. They're issuing a bond that did not exist. And when they issue that bond, that bond in a lot of ways is a lot like a savings account. It's basically the super safe instrument that earns you some interest.

And so from the very first instance, the real balance sheet expansion occurs when the Treasury runs a deficit and creates that bond, which is effectively similar to a savings account. So what the Fed when they run quantitative easing is they're coming in really after the fact. And they're swapping now a deposit account for this savings account. So from the private sector's perspective, what's functionally happening is you're swapping this savings account with a checking account.

So if I sell my bonds to the Federal Reserve effectively, I'm now holding a deposit, that's basically a zero-yielding checking account and I've given them what is functionally my savings account. So when you think of it, from that perspective, the whole view of where the real impact is completely changes because from the function of the Treasury and the deficit spending that originally occurred, well, that's a real balance sheet expansion.

If you wanted to call it money printing or bond printing or asset printing or whatever you want to call it, that's where the real asset printing occurs. Whereas with the Fed, everything that the Fed is doing, what they're really doing is they're changing the composition of all this stuff that was basically already issued. And so thinking of it in those terms, it kind of—

When I first realized this back after the financial crisis, it sort of transformed my whole view on monetary versus fiscal policy because you come to this realization that, well, wait a minute, the Fed isn't the real money printing entity inside of the economy. Even we've all come to this belief that it is. When in reality, it's the Treasury that is functionally the real money printer. And this is not to imply that the Fed has no impact on stuff because they do, in a lot of meaningful ways. But from a pure narrative perspective, the whole money printing narrative is in many ways a fallacy because the Fed, even though they technically do expand their own balance sheet, when they implement this asset swap of exchanging the checking account with the savings account, they're taking that checking account out of the economy. They're putting it on their balance sheet and that thing doesn't exist for any practical purpose in the real economy. Whereas the balance sheet that matters, the private sector balance sheet, the composition of it has simply changed.

Dan Ferris: I think where people get screwed up is that the Fed and Bernanke on 60 Minutes told all this, the Fed actually does though. They go to the computer and they magically create money to take that, what you're calling a savings account, which is really Treasury bond, out of the market and then swap it for a dollar. So people think that that printed dollar that's being swapped, that's the site, that's where inflation just happened. I think that's where people get screwed up. But you're saying that the real balance sheet expansion occurred at the moment of spending. When the fiscal spending happens, the Treasury creates this new debt instrument, etc. So what the heck is inflation, man? When does it happen? Is it happening right now?

Cullen Roche: Well, I think this is one of the most interesting things about COVID. Is that what we've kind of learned from COVID is that who really, what federal entity really has the big bazooka. And I think the lesson from COVID versus the financial crisis is that it really is the Treasury that has the big bazooka, because the Fed did all the same stuff back in 2008, 2009. They extended their balance sheet by trillions of dollars. And they did all of these huge programs that they didn't really cause any sustainable high inflation. In fact, we had basically disinflation, which is a falling rate of inflation, for 10 years. But we now know definitively that something different happened from COVID response. And we actually talked about this in 2020 about how I expected relatively high inflation to come, because we saw these huge fiscal responses.

The government ran these huge $6 trillion or $7 trillion deficits. They actually ended up being way bigger than I actually thought they'd be back in 2020 when we talked. And that's why I think we're seeing now this 7%, 7.5% CPI reading that we're seeing. We have this very definitive now, I think, look back at the two different, the big difference between 2008 and 2020 was that the federal government, the deficit was something like $1.5 trillion. I think the rescue package from the financial crisis from the actual fiscal side was like $800 billion. We ran multitrillion-dollar programs for consecutive years in the last two years. So these programs were gigantic – they were so much bigger than anything we did in comparison to 2008. And the resulting impact has been a lot more inflation.

Dan Ferris: Now there's another thought and in fact, our listener needs to know, I have kind of explained it sort of this way that we're talking about, in previous episodes when we've talked about this. In other words what I've said is the whole asset swap thing that the Fed does, right. They're taking income out of the economy and just putting a checking account deposit out there. And it's my impression that like the deposit just kind of mostly sits in the reserve account and doesn't go anywhere because all the money, most of the money in our economy in fact is created in the banking system. It's lent into existence. And without that lending activity, you haven't seen inflation, but now we've gotten around that. The government can get around that because as you say, it has the big bazooka. The spender has arrived. So I take what you're telling me then as this is the real deal. This is inflation with the capital "i."

Cullen Roche: Yeah. So what they're doing, and this is another important aspect of government deficits that what they're doing is let's say for instance that I'm the bondholder. I own a diversified portfolio of bonds. And let's say that I just happen to be the guy who transacts directly with the Fed. Well, my propensity to consume is much lower relative to someone say who's earning like minimum wage. Because I save a lot of money. I try to practice what I preach. I'm pretty fiscally conservative and prudent. So I like to hold assets and save money.

Whereas, so when the Fed transacts me with me and they're running a deficit, when they swap the composition of my portfolio, yeah I might go out and I might change my previous Treasury bond holdings for like a junk bond or something, or maybe a higher-yielding corporate bond, something that's kind of roughly similar. And that's what I think a lot of people talk about when they talk about the chase for yield and the Fed pushing people into other asset classes, but I'm not going out and suddenly buying more goods and services.

Whereas when the government runs a deficit, what they are doing is they're actually taking a deposit from me. So they're giving me a bond they're taking my deposit and they're giving my deposit to somebody who very likely has a higher propensity to consume. And so what they're functionally doing when they run this deficit is they're taking money from somebody who is essentially just hoarding the money and saving it and giving it to somebody with a higher propensity to consume, thereby creating higher demand for goods and services by running a deficit.

And that's, I think that's the big thing that we've seen in the last couple of years is that they basically took $7 trillion and redistributed it from essentially people who were bondholders and gave it to people who were middle class or minimum wage type earners. And those people, they spent all the money. And you've seen this with the private savings rate where the savings rate spiked way high following the initial response to COVID and it's come right back down.

And so this was another thing we talked about in 2020 was that a lot of people think that the stock market rally hasn't made a lot of sense when in fact, all of this money, functionally it flowed right into corporate coffers because as soon as consumers stopped saving the money, well, all that money, where does it end up? It ends up with corporations. And so corporate profits are at all-time highs, earnings per share are at all-time highs. And so the stock market, I think the boom has been much, it's certainly been much bigger than I expected it to be. It's sort of shocking in a lot of ways where the stock market went and kind of seems to be maybe mean reverting at present. But there's a lot of sensibility to what's happened in the last couple of years because corporate balance sheets are so healthy because the government basically they printed $7 trillion and essentially handed it to corporations.

Dan Ferris: Right. Indirectly through the consumer. So let's talk about, so that's the money creation, spending inflation track. What about the other part of this? The other part of the narrative is that Fed activity or wherever the money is printed supports the stock market, somehow. Now you've alluded to it by saying, well, the money goes to corporations, their earnings are strong, etc. But is there any other more direct relationship and is that relationship simply, is it a function of what the Fed's influence on interest rates, for example. You see where I'm going?

Cullen Roche: This one's really tough. There's elements of it that –

Dan Ferris: Well, there's no straight line, right? That's one thing, I'm sorry, I meant to say. There's no straight line. There's this narrative that the Fed supporting the stock market, but you can't draw a straight line from the Fed's activity on the stock market.

Cullen Roche: And part of it is, like I was saying before that the fact that corporate balance sheets really are healthier means that there's a rational reason why the stock market has gone up. I think the thing that I think some people allude to when they talk about the Fed manipulating asset prices is the implication is that there's no fundamental driver of what's going on. That it's all kind of just like a government-manipulated bubble. And the reality is that when you look at things like corporate profits, well, there's a rational explanation for all of this. It makes sense that the stock market surged to record highs, well earnings per share were surging to record highs, while corporate profits were surging to record highs.

And I think you could make the argument that, oh, well, even Cohen is saying that that's just because the government ran huge deficits and essentially gave the money to corporation and you could say, well, yeah, certainly there's an element of truth to that. And how sustainable is all of this. Because the government can't just run $3 trillion deficits in perpetuity every year for the rest of eternity, without something eventually either causing a huge bubble and crashing or causing bigger problems along the way.

But in the last two years at least, I think looking at what the government has done and looking at where the money has flowed, ell, the money's flowed to corporation. So, the Fed and all of the stuff they're doing, I think, part of their goal is yes to cause this portfolio rebalancing effect where they're trying to get people to – they really want people in the real economy to invest more. They want people to spend more on real investment funding, real corporation creation and new investment through like innovation and things like that. That's ultimately the Fed's big goal.

And I think a lot of what we end up seeing though, is people end up exchanging stuff on secondary markets like the stock markets or the bond markets, where what's the real impact on the real economy. Are we all just shuffling money back and forth here? Or are we having a real impact on the actual underlying corporate fundamentals? And that's where things I think get a lot more debatable. And I'm sympathetic to the idea that there's certainly some impact but it's not this black and white thing where you can't just look at what the Fed has done or what the government has done and say, oh, well, it's all manipulated because you can look, you can draw a line right to corporate balance sheets and say, well, no corporate balance sheets are fundamentally healthier than they were a few years ago.

You can make arguments that maybe things in some ways are not as well off as they were before COVID or whatever. But from corporate America's perspective, things look pretty good right now. So how sustainable is it? Could the government peel things back in a way that will actually cause maybe the opposite type of effect. I think there's also reasonable arguments for that. But it's not this thing where the Fed has caused all these asset prices to go up for no sensible reason.

Dan Ferris: So let's talk about what happens next. Now on the one hand, you point out rightly you can't run $3 trillion deficits forever and just keep printing. But I think one of the great lessons from Japan, Europe is that eventually that extra dollar of debt, it's not stimulative. And that goal that you're talking about that the federal reserve has, all I can think of is, the set of tools that they have seems to be really ill-suited to the purpose of stimulating economic activity, which makes a bit of sense to me because entrepreneurs, as far as I know, entrepreneurs don't sit around and say, I wish interest rates were lower. That's like not the main thing on their mind, like stimulating real economic activity and real, like we're talking investments in assets and businesses and new economic activity, it doesn't seem to me like these tools that central banks, you could even generalize further, that's why I cited the example of Japan and Europe, these tools they seem to be really ill-suited and almost suited to the opposite purpose. In other words, eventually there's the dead issuance and in whatever roundabout way the monetization of it, and sooner or later that extra dollar out there, it is just like less and less and less productive. They can't be that ignorant.

Cullen Roche: You're seeing that in the way that this is causing inflation now that essentially the purchasing power over dollar now is not sustainable because of what in large part the government is doing. And there's a lot of debate right now about what's really causing inflation. And to me, it seems pretty obvious. There's certainly a supply chain aspect of all of this, but the government effectively printed $7 trillion in the last two years and just dumped it in the middle of this street in Washington, D.C. And it's slowly filtering through the economy now, and we're finally starting to see the impact of all of that. And so, how sustainable is all of that?

And I think what we're learning now is that it's weird how these things sort of ebb and flow over time. We went through this period of low inflation that I think convinced a lot of people that the government couldn't cause inflation, or wouldn't be able to, even with huge spending packages. And it's the thing that, again, it's the big takeaway from the whole COVID experience, is that fiscal policy is really powerful and there are certainly times where I'm sympathetic to it, especially like I think that during the financial crisis, there were reasonable arguments for the government running deficits at those times. And there are certain aspects of this are even automatic.

The fact that for instance like during a recession tax receipts decline and unemployment benefits increase. So by definition, there's sort of an automatic increase in the deficit that economists call state automatic stabilizers, where you're basically getting an increase in the size of the government's deficit, just because they earn less income and they end up spending more because of the unemployment benefit increase. So there's logical things like that that I think actually are stabilizing to some degree, but the kind of scary thing coming out of COVID is that we're realizing that the discretionary issuance of money through large deficits can have enormous inflationary impact that—

And even looking at like the financial markets, I think you can argue that when there is a fundamental driver of something like the S&P 500 and corporate profits in the last few years, but you have to ask yourself, well, what happens if the government now peels all of this back? And what happens if the rate of inflation now starts to reverse because the government now they don't have their foot on the gas pedal. They have their foot kind of, they're kind of starting to tap the brakes.

The Fed is starting to tap the brakes with talk about raising rates and reducing the size of the balance sheet. And you're going to see a big fiscal drawback in the next probably 18 months because the government is now – you've seen this with the way that a lot of these big spending packages have been nuked. I mean, Build Back Better getting derailed in the last few months, and you're not going to have any big fiscal-spending packages passed in the next couple of years. This is kind of a tangent, but it would be really interesting to see what happens in a recession in the next couple of years, if we were to have one, because I don't even think we'd have the wherewithal to respond to it like we did during COVID or during 2008. And so it's kind of weird how all of this ebbs and flows over time, because we're seeing now the impact of big spending packages and the negative impact that has through inflation. And I think that's going to make things a lot more volatile going through the next few years, because you're not going to have the level of government support that I think a lot of people became accustomed to from the post-2008 period and the COVID response period.

Dan Ferris: Are you saying we're not going to have it for political reasons or because they're running out of ammo argument, that they're running out of the ability to move the needle kind of.

Cullen Roche: Well, from an operational perspective, the printing press doesn't run out of ink. The Treasury doesn't run out of the ability to print Treasury bonds and finance spending. What they run out of is they run out of demand for those things. And you're seeing that through the rate of inflation to some degree, the demand for holding dollars has declined relative to everything else. That's functionally what inflation is. And more importantly, yeah, you're starting to see that as the rate of inflation increases, the political will for implementing these sorts of things is coming to a stall.

Dan Ferris: Right. I see where you are now. All right. I got that. For me, the next layer is ex-U.S. demand for dollars. All I hear is that there's still practically a shortage outside the U.S. All the demand for U.S. dollars that's been there in the last 10, 15, 20 years is still there.

Cullen Roche: Yeah.

Dan Ferris: So, in other words, go ahead.

Cullen Roche: If you think Fiat currencies are basically just a bad form of money in general. Well, the dollar is the least bad of all of them. I always talk about people sometimes come to me and they say, oh, well, you know what happens when the U.S. Treasury market collapses and my response is always, well, what's the alternative? What's the alternative bond market? What's the alternative reserve currency to the U.S. dollar because when you look at all the other options and you've got the Chinese renminbi, which nobody trusts except for the Chinese.

Then you've got the euro, the euro has all sorts of problems because like they don't even have a universal bond issued inside of Europe. They still have all their own, we've seen that rolling sort of euro crisis occurring in the last 10 years where we're not even sure how many members of the eurozone are going to be there in 10 or 15 years. So, what's the alternative?

The Japanese yen isn't nearly big enough market to be an alternative reserve currency. So looking at all this stuff on a relative basis, the dollar is the de facto reserve currency just by being essentially the least bad currency out of all of them.

Dan Ferris: And by being the biggest game in town.

Cullen Roche: Yeah. And it's almost impossible for me to see that over the course of my lifetime, even I think, so, yeah, you can make arguments that China will grow and probably become a much bigger and bigger economy, but their government is still essentially a communist government that is Very untrustworthy in a lot of ways. And so, yeah, it's hard for me to imagine the dollar not being the reserve currency in 10, 20, 30 years, because there is no alternative.

Dan Ferris: Right. And it's interesting to me, I guess, I have you and other and other folks who are much better at this sort of macro analysis than I will ever be probably on the program for this very reason. So maybe you can correct my thinking here if I'm making a mistake, but I think it's, it's just somehow interesting to me that you can have this incredible ubiquitous, the world over demand for dollars just constant 24/7, 365-day demand for dollars and still get 7%-plus on the CPI, just like that. And just like that is a year or two in the making. But still here it is. That constant demand in other words, it's constant, but you can still make rents go up 18% and you can still make stuff in general go up 7%-plus.

Cullen Roche: Well, it's weird because thinking of it from a financial asset perspective, all financial assets by definition are held by somebody. So it's all a relative basis gain basically where, yeah, even though all financial assets are held by somebody, well, the demand on a relative basis can still decline. So when you compare everything today, for instance, to like look at the boom in housing prices, the demand for real estate relative to holding dollars has gone way up.

People would rather hold a real asset, like a house on their balance sheet rather than holding the actual physical dollars. And so a lot of that is just a relative demand function where we're seeing, especially in the short term, the relative demand for dollars versus, especially things like real assets has declined. And so it doesn't mean that inflation can't happen. It just means that what you're going to see over time, especially in periods, like such a disruptive period like COVID, is that the demand for real assets increases in such a way that you end up getting a really meaningful rate of inflation in the short term, at least.

Dan Ferris: All right. I feel like I could just go around and around with this stuff and you will indulge me. But I want to get to what you're doing right now, if you've made any big portfolio changes, like past year, past six months, anything that you've found that you think is really a cool idea that you weren't doing last time we talked, let's say,

Cullen Roche: I've become increasingly bullish about – it's actually funny. If I had to, we posted our annual review earlier in January, I listed a series of assets that were attractive. The way I wrote it was basically most unattractive to least unattractive. Basically, my overarching view is that there are not a lot of great places to hide in the entire asset world today.

That when you look at a lot of the different asset classes, I think there is, I don't like to go into like the Jeremy Grantham, super bubble type of mentality, where you give the implication that everything is overvalued and you need to be out of everything. But there's a lot of truth to the fact that everything is pretty expensive, whether you look at like real estate or the stock market or the bond market, or even cryptocurrencies.

A lot of this stuff by almost any measure has been on the sort of tear that makes it relatively unattractive going forward. And so to me, one of the few spaces that's been really beaten down or sort of stagnant in a really surprising way, and some people might be surprised to even hear this from me, but, something like gold. Gold and actual physical commodities look really attractive relative to a lot of other aspects class. And you can kind of go down the list of things that haven't performed as well in the last sort of five to 10 years, is a lot of the hot sector names like, value versus growth, for instance, has been a huge underperformer. If you're picking stuff in the stock market, things like very high quality, the boring, old companies that people really fell out of love with in the last five to 10 years, I think look way more attractive today than they ever have. So looking at kind of an international versus domestic perspective.

Foreign stocks to me look much more attractive than domestic stocks. And so a lot of the big trends that we've seen in the last, especially the last five years, or especially a lot of the trends that were hyperescalated from COVID where things like the continuum of like the tech boom occurring. I would not be surprised if a lot of those trends reverse. And so at the same time though, I touched on this last time we talked, I think that given the way that the financial world is so overvalued across so many different spectrums, to me the argument for an all-weather type of portfolio today is probably stronger than it's ever been.

Like just looking at something that is a very sort of, even like a boring sort of permanent portfolio, like Harry Brown's permanent portfolio. He used to do 25% gold, 25% stocks, 25% cash, and 25% Treasury bonds. And that way you kind of covered all your bases in terms of potential outcomes. To me, that sort of perspective is more valuable today than trying to pick and choose exactly what the right place to be is because there's still really reasonable arguments that even picking out the components that look more attractive. Well, what if we end up being wrong?

What if we were to revert back to this sort of like low inflation environment in the next few years and commodities just sort of start to muddle along again or something. And at the same time, the overvalued stock market actually deflates some. And so, to me the potential different outcomes in this environment, given all the weirdness of COVID, they're so wide. Like I think that at no point in my career have I looked at all of the different asset classes and just have such a disparity in what the potential outcomes could be, because of the potential outcomes following COVID, it wouldn't surprise me if we had a high continued rate of inflation in the next five years. It also wouldn't surprise me if like you had this huge asset bust where you had this sort of suffocating deflation to some degree taking hold in the economy. And so, looking at things from that perspective, I think it's more law now than ever to look at something like a permanent portfolio type of view or an all-weather type of view. And you have to be diversified because nobody knows what the hell is coming down the pike in the next couple of years.

Dan Ferris: Colin, I have to say you sound a little like me. I'm not kidding. I've been preaching this, you must be diversified more now than ever thing, for a little while now. And of course, I've liked gold for a while. And also I've been talking about value growth, ex-U.S. And as you were saying that too, I thought, well, you're probably the guy I should ask, are those cycles, commodity stocks, value growth, the ex-U.S., U.S. I brought this up in a piece that I wrote recently, and one of our readers wrote back and said, that's just the dollar, Dan.

That's all the same cycle. And I thought, OK, but it's also human nature, isn't it? It's also like the desire to buy a whole lot more and allocate a whole lot more capital to what's worked recently. And that starves the other side of all of those trends. So eventually, no matter how strong the dollar may or may not be, you've got to have that other stuff, or there will be demand for that other stuff and starving it of Investment creates an opportunity.

Cullen Roche: Yeah. In a lot of ways, that's one of the strongest arguments, I think, for the idea of owning something like whether it's value stocks or foreign equities, for instance, or even real assets, is that you are in some sense, you're hedging your currency exposure to some degree. And I think a lot of people, especially investors in United States, they take this very, I think, narrow focus where they take for granted how strong the dollar has always been. And they have typically a really strong home bias in terms of how their asset allocation breaks down.

A lot of people who invest in the U.S., for instance, if you put together like a 60/40 portfolio, like John Bogle for years argued that you don't even need to own foreign equities inside of a 60/40. And my view would be well, that works great, as long as the United States continues to be a really, really dominant reserve currency and global economy. But if you were to see that even wan in a relative sense, well, you'd start to see a pretty significant relative under performance of the foreign or the U.S. versus the foreign stuff.

In which case you will have loved owning a slice of the foreign stuff inside of whether it's your 60/40, or your all-weather portfolio or whatever it is. To me, I'm very wary of people with an extreme home bias because you can look through history and see periods where, again, this stuff ebbs and flows over time, and you can think of, if you think of even more extreme sort of regime changes, like consider the investor in London in year 1700, who if they had had access to a Vanguard account, they would've looked at it and said, well, why in the world would I ever own stocks in other parts of the world and the investor in the U.K. who took that perspective from the year 1700 to present day, they missed out on one of the biggest booms in economic history because they missed out on the U.S. economy, essentially developing.

And so you can get these things of extreme home bias, probably a better example, a much better example, is that the investor in Japan, in like 1990, who took an extreme home bias. And so, you can pick and choose this stuff and, obviously you don't want to build a portfolio where you're just betting all-in on like doom and gloom, or like the collapse of a global empire or something like that. But again, it makes a lot of sense to be diversified because that's the beauty of the assets that we have access to today. You don't have to be all-in on U.S. stocks. You don't have to be all-in on gold. You can build these super diverse, low fee portfolios that are really tax efficient that give you access to this crazy amount of diversification and does so in a very, very sensible way where you don't have this like asymmetric downside to some outlier event that blows up the U.S. economy inside of a five- or 10-year period or longer period where you go through something like what Japanese equity investors have gone through for a lot of the last 30 years.

Dan Ferris: Yeah. Sounds good to me, man. You're singing my song. You really are. So it's time for my final question. You've done this before, but I'll remind you. It's the same question for every guest, no matter what the topic, and if you had to leave our listeners with just one thought, what would that be?

Cullen Roche: Last time I said patience. My new company is literally called Discipline Funds. So I've become just a huge advocate of trying to apply this concept of discipline to people's portfolios, where you find a portfolio that is not just appropriate for you from a financial planning perspective. Meaning that it's likely to serve whatever your financial goals are in the long run. But more importantly, it's something that you can stay disciplined to. And I think that that's, especially in these more volatile environments, and we've seen this with some of the big booming funds in the last year that have done really well that have since seen some of the air come out of them, that people have a tendency to chase returns and they do it on the upside and they do it on the downside.

And it's because essentially they don't have any built in discipline inside of their portfolios. And to me, it's really important for people to understand that the sub-optimal portfolio that you can stick with, that you'll be disciplined to will in all probability outperform the optimal portfolio that you can't remain disciplined to. Because you'll make catastrophic behavioral errors across time where you end up essentially buying high and constantly selling low, and this revolving door of bad behavioral mistakes, it not only compounds from a tax and fee perspective, but it compounds from this huge behavioral impact that it keeps you treating your investment portfolio more like you're at a casino than you are actually putting together like a sensible financial-planning-based asset allocation.

So to me, more than anything, especially in these really volatile environments, you have to put together something that you can remain disciplined to... because the portfolio you can stick with will serve you much better through thick and thin than the portfolio than the elusive, perfect portfolio that you're constantly chasing – and more often than not, making mistakes around.

Dan Ferris: Wow. That's a great one. That's a great answer. I've told people, investing is a very personal thing, and that sounds like what you're saying is, you've got to really think about who you are, what kind of a person you are, how are you likely to behave if you're stock went down 20%.

Cullen Roche: Yeah. So much of it is about knowing yourself and the really sad thing that I constantly see throughout my career is I see a lot of people, they learn who they are at the worst times. And typical in a lot of cases, they learn who they are in appearing like 2008 or 2009 or March 2020. I always say that the worst time to learn your risk profile is during a huge bear market. You want to learn your risk profile during a big bull market. And it's always frustrating to not get all of the upside. But the trade-off is that you end up creating in most cases a much more stable, long-term type of return that you're able to sustain behaviorally. And so it ends up actually performing better for you than chasing where the grass always looks greener.

Dan Ferris: Well said, my man. Thank you so much, man. I'm not going to wait as long next time to get you back on the show. I like having you around. Just thanks for everything. Those are great insights. I hope everybody takes them to heart.

Cullen Roche: Yeah, thanks Dan. Thanks for having me on.

Dan Ferris: You bet. I hope you enjoyed that as much as I did. We say that a lot on this show, don't we, but it's true. Cullen is one of my favorite people to talk to because he started out saying he wasn't a very smart guy, but that's not the truth. The truth is he's smart enough to know the complicated situation and then just give you a very straightforward, easy-to-understand explanation of it. And that's really why I wanted to have him back. I wanted to talk about the Fed and inflation and get his really good nuts and bolts viewpoint of these things. And I think, I don't know, it was pretty clear to me. I hope you think it was pretty clear to you too. Also, I have to say, I know I'm tuning my own horn, but I love the fact that he's wound up at a similar place as me in terms of believing that diversification is more important than ever, wanting to have a little gold in the portfolio, and paying attention to value, growth, commodities versus stocks and ex-U.S. stocks versus U.S. stocks. I've talked quite a bit about all three of those things here on the podcast and also in the Stansberry Digest, really, really important right now. I think I think Cullen Roche is a perfect guest for this moment, and I'm glad that he was able to talk with us. All right. Let's take a look at the mailbag. Let's do it right now.

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You're hearing this right now out of my mouth folks, and 80% market crash is probably on the way. In fact, it may have already begun, and it could be far worse than any previous crash because of the dangerous can't-lose mentality in so many assets today and the flood of novice investors in the markets, since the start of the pandemic. Of course, there is one particular strategy that works extraordinarily well in moments like this. To be clear, you do not need to sell everything today or go all-in on my approach, but I do think you'd be crazy not to at least consider putting 10% or 20% of your money into this strategy today. Stocks poised not only beat runaway inflation, but benefit from it. For the full story, go online to danupdate.com. That website again is danupdate.com

In the mailbag each week, you and I have an honest conversation about investing or whatever is on your mind. Send questions, comments, and politely worded criticisms to feedback@investorhour.com. I read as many e-mails as time allows, and I respond to as many as possible. You can also call our listener feedback line, 800-381-2357. Tell us what's on your mind and hear your voice on the show. We got a lot of good e-mails this week. First up is Steven H. And Steven says, "I've been enjoying the podcast for some time now. It's part of my routine when I go play hockey." All right. "Thanks for putting this out and selecting good guests. I have had a few things rattling around in my brain that I'd like to share. First, could we please stop referring to the changing value of our currencies as 'inflation'? This term sounds so benign and technical and legitimate.

"I propose that for the foreseeable future, we should refer to the change as 'currency debasement.' From what I can see in the world, the primary driver of the change for the past decade at least has been currency debasement. When that ceases to be the case, perhaps we can go back to using a technocratic term like inflation. Second, it might be worth noting that the approximate cause of the French Revolution was a sovereign debt crisis." And then he does quite a bit of explaining and he wonders, he says, "I wonder where the USA will go after its impending sovereign debt crisis." Hmm. And finally, Stephen H. says, "I think your listener should have a read of Lewis Carroll's The Walrus and the Carpenter perhaps after they've been doing some financial analysis and calculating free cash flow and they need a break. To be clear, you, me, and your listener should think of ourselves as the oysters, not the walrus or the carpenter. Take care and keep up the good work, Stephen H." I haven't read The Walrus and the Carpenter yet. I will get right on it as soon as we're done recording here.

And as far as the other two go, yeah, I hear you on inflation. They've even told us, the Fed has said, you know, a certain amount of inflation is good, which is crazy. So I agree. The term is just, it's lost its zip. It's lost its impact. And as far as the U.S. having a sovereign debt crisis, all I'll say is that printing the reserve currency means you can issue a lot more debt than everybody else. So you should count on that happening. They'll do it. And the sovereign debt crisis in the U.S. will probably take a lot longer to come around than most people would ever dream. But it's good to think about it and it's good to worry about it a little bit.

Next comes Levi N. And Levi N. is talking about free cash flow, and he says, "Hi. First is, always thanks for all you do. Just finished listening to your analysis on free cash flow from the most recent podcast was, wondering if you could take it one step further and maybe also include this to the subsequent analysis, understand the raw numbers of free cash flow, their importance, etc., but what about their relative value? Do you compare the free cash flow to market cap, enterprise value, outstanding debt, etc.? I know you can compare to anything you want, but the question is, what do you value most? What comparison do you value most?" he says. Then maybe comparison to like businesses.

Really? How do you use the number in your assessment? Thanks again. Levi N. Levi, the primary thing I wanted to get across was just to know that you're looking for companies that generate plenty of free cash flow. That's the primary thing consistently. And as far as the comparisons, like we don't do free cash flow to market cap or EV or outstanding debt or any of that stuff because that is not the key metric. The key thing is to do what – I believe the key thing is to be able to do a real free cash flow, discounted cash flow analysis and arrive at some reasonable estimate of either the intrinsic value of the business or the way we think of it is that is the growth expectations built into the current value based on, you know, where the stock price is today versus what management is saying they can do versus what we think they can do?

It gets complicated pretty quick. There's a lot of moving parts. But the basic parts are operating margin, free cash flow, revenue growth. And Mike Barrett actually runs the model, and he does a lot of work to arrive at our estimate for what kind of growth we think we can expect versus what the market is expecting. That's how we do it. We don't go free cash flow to market cap. Those multiples are too simplified. And at best, they're a substitute for the process we use, but over time, I've come to believe they're a poor substitute.

But thank you, Levi. That's a good thing to ask about. Next comes Aussie Stu from Down Under. Stu, good to hear from you. It's been a while. And Stu says, "Still haven't missed an episode. Great stuff. A few questions. Russia invades Ukraine, the market's rally huge 3% or more in the day, gold dropped. What? Can you explain this?" He says, "I'm getting very frustrated with my gold and silver mining stocks. And gold and silver after hanging on through all of the supposed tailwinds for gold, I'm thinking I'd be much farther ahead plowing it all into bitcoin. Bitcoin was up 6% on the week and gold down 1%. I have read gold has actually lost over 30% of its value over the last 11 years due to the debasement of the USD. Compare this to bitcoin thoughts. Also, I have bought some of your crown jewels in Extreme Value. Let's hope they help my lagging mining portfolio. Haha. Thanks in advance, Dan. Keep up the great work, Aussie Stu."

Stu, I think you may have misspoken here. You said "I have read that gold has actually lost over 30% of its value over the last 11 years due to the debasement of the USD." Maybe you mean due to the appreciation of the USD. I'm not sure, otherwise, what that could possibly mean. Gold is priced in dollars. Therefore, when one is going up, the other versus that one – you know, if the price of gold goes up, that means dollars are less valuable relative to it. And if the price of gold goes down, dollars are more valuable, right?

They're always traveling in opposite directions because one is priced in the other. Right? So I don't quite know what you're getting there, but it doesn't make any sense. I mean, if I look at an 11-year chart of gold, it was about $1,400, 11 years ago, and it spiked up to $1,900 in 2011, which was neat. And then it crashed to $1,000, which was less neato. And then it went up to $2,000, made a new high in 2020, and now it's in the high $1,900s as we speak.

And, you know, I don't know, is it headed for a new high? You'll never get me predicting anything like that because I don't do predictions at all. I just think you should hold gold and silver and forget your own and forever. As far as gold and silver mining stocks, I still think you can buy them, and I think they're a great deal for the next five, 10 years. I think you can expect a pretty decent performance. So, you know, that's what I think. And as far as bitcoin goes, look, what I mostly see is bitcoin falling at times when, if it were a store of value or better than gold, it should be rising. Right? There were times when it rose recently when I thought, OK, this is it. It's going to start acting like a risk-off asset right now. But mostly, it acts like a risk-on speculation, technology speculation. I mean over the past week, I'm just looking at a one-week chart here in Coinbase, minus 3.5%.

So I don't know. And you know, gold is up, but those short-term movements that you're talking about there one day, this one-day movement that you talked about, you know, where gold was down, the market was up during the invasion of Ukraine. Meaningless. One-day moves are meaningless. You don't know what's going on. And one week is not much more meaningful. Sorry. I know that's unsatisfying, but that's the way it is, but these are good things to think about anyway.

Ellen is next, and Ellen says, "Good morning, Dan. Thank you for your dedication to sharing relevant content and your educational insights through the Stansberry Investor Hour podcast. I became a Stansberry Alliance member a year ago and quickly overindulged in too many positions, like a kid in a candy shop. Over time, I have chosen my favorite newsletters, Extreme Value being one of them." Thank you, Ellen. "And have been using trailing stops and sell alerts to exit positions that don't fit my long-term plan."

Let's see. Then she says, "I was also planning to increase my position sizing in stocks that I want to hold forever, or at least very long term, 10-plus years as prices come down, either through a correction or a bear market. I thought this was a good plan until I read the February 5 DailyWealth Trader description of averaging down versus scaling in. And I'm wondering if these strategies are only relevant to short-term trading or for all investments, including long-term forever stocks. Can you shed some light on your thoughts about when and how one would increase positions in Extreme Value-style stocks, especially for those of us who are holding a considerable cash allocation? There are so many possibilities, lump-sum investing, dollar cost averaging, buying the dip, cheap, paid, and in an uptrend, etc. I'd love to hear your thoughts."

Thank you again, Ellen. Well, Ellen, you know, you get 90% of my thoughts in Extreme Value, first of all. And as far as DailyWealth Trader, you know, actually Ben and Drew are great at what they do. But those things are – apply to them to their strategy. They do short-term and medium-term, and I think the occasional long term, but I think they're mostly focused on the short and medium-term. But whatever they are, they'll tell you, and you can read the publication and it tells you. So as far as averaging down, basically what I hear is, when do I average? When do I increase positions in Extreme Value-type stocks? Is what you're asking. We generally tell you, you know, we'll raise a buy-up to price or we'll say, you know, this stock is down 20%, but we think you can still buy it.

And that really – that's my best answer. Now, there's another component here, Ellen, and that is you. You need to make a decision about how much money you want to have in anything. And I can't do that for you because it's not generic. You can't just pull it off the shelf and it's the same for everybody. You need to decide how much money you want to have in certain kinds of stocks, bonds, and whatever else, anything else, land, whatever, commodities, I don't know, futures, options, anything. Those decisions are yours to make. And they're based on your knowledge of yourself and your understanding of how risky those things are, and futures and options are super duper risky, you probably shouldn't go anywhere near them. And you need to think about this and decide your risk tolerance and decide how much you're comfortable having in anything.

And what kind of an investor are you? Right? Take an extreme example. We know what kind of investor Warren Buffett is. Don't we? We know exactly what kind of investor he is. He made that decision years and years ago, and it's evolved, and he's done some different things here and there, but mostly, he's a guy who's looking for a great business that he can just buy once and hold onto forever. And you need to decide, you know, what kind of investor, how much of your portfolio is like that? How much of your portfolio is forever versus, you know, out at the first sign of trouble? I know some of these answers are really unsatisfying, but it really is true in my opinion. OK?

Next up and last this week is David S. And David S. says, "I really enjoyed your latest interview with Marko Papic, as well as the one with Rob Arnott. I'm a huge fan of everything at Stansberry Research, but as busy as I've been the last few months, I failed to notice until recently that much to my disappointment you guys put an end to the Big Trade publication, which was of course predominantly about establishing short positions due to consistent underperformance in the face of a relentless bull market. Could this yet be another sign that a top is upon us or at least imminent?"

I'm going to answer that part first, David, because maybe, maybe not, I would hesitate. I mean, we have so many publications, and publications come and go. It's definitely a sign that it's been really, really hard to be on the short side for the last decade or more. But, you know, you won't ever hear me calling a top. That's certainly the type of thing that happens around the top. Right? But I don't know. It's going to be hard to ever get me to say absolutely yes to a question like that.

All right. Moving on here, David then says, "Frankly, I'm surprised by the decision. I understand there's pressure to generate positive returns to keep the subscriber base happy, but throwing in the towel seems like just the sort of thing you would expect average investors to do just when the opposite approach is probably more appropriate. After all, as Rob Arnott suggested, we should aim for maximum pain at both ends of the cycle. Easier said than done, of course, but it seems to me now is a better time than ever to start placing some shorts on the worst of the worst of the zombie companies. Keep up the fantastic work. Kind regards, Alliance member, David S."

You know, David, that thing about average investors doing this sort of thing. I hear you. It does look that way, and it's good of you guys to, you know, look at how the business interacts with the content of the publications. That's smart. I don't know if I would read too much in here. I've had publications that I thought could have had a really good track record, and I just sucked wind. And the thing had to be shut down because nobody wanted it anymore. And I thought, you know, I could have turned it around. I definitely could have turned it around in one case. But, you know, it's a complicated thing, David.

Let's just leave it at that. You know, there's a decision at the management level and I'm 3,000 miles away from that. I'm 3,000 miles away from the mothership, I'm not in on those decisions nor should I be, unless they affect me absolutely directly. And even then, the management does what it wants, right? This is a business. So I hear you wanting to read into this, but the only thing I'm really comfortable reading in is that we could no longer offer this publication without hurting our business. So we decided to close it down. That's the only thing I can be sure of. And yes, it's the type of thing that happens after 11-plus years, or however many years it's been here. Oh gosh, since 2009, the unpleasantness of March 2020, notwithstanding, 13 years of bull market and the current unpleasant notwithstanding, it's exactly the kind of thing I'd expect. I'm surprised it lasted as long as it did, put it that way.

If we had shut it down three years ago, would it have been a sign at the top? Well, you know, maybe in a short-term basis, right? These are good things to think about though, David, and you're kind of smart to pose a question like this. We got one last week in a similar vein, and I'm glad that you folks are thinking. You're on your toes. I like it. So that's another mailbag, and that's another episode of the Stansberry Investor Hour. I hope you enjoyed it as much as I did. We do provide a transcript for every episode.

I got another e-mail this week. I get one or two every week about transcripts. We do provide transcripts for every episode. It may take a little bit of time to get up on the website, but it'll always be there eventually. Just go to www.investorhour.com, click on the episode you want, scroll all the way down, click on the word "transcript," and enjoy. And you know, a good transcript takes a little time. We really try to make good transcripts. So it might take a little time.

But if you like this episode and you know anybody who might enjoy listening to the show, tell them to check it out on their podcast app or at Invest.com. And do me a favor, subscribe to the show on iTunes, Google Play, or wherever you listen to podcasts. And while you're there, help us grow with a rate and a review. Follow us on Facebook and Instagram. Our handle is @investorhour. On Twitter, our handle is @investor_hour. You have a guest you want me to interview? Just drop me a note at feedback@investorhour.com or call the listener feedback line, 800-381-2357, tell us what's on your mind, and hear your voice on the show. So next week, I'm Dan Ferris. Thanks for listening.

Recorded Voice: Thank you for listening to this episode of the Stansberry Investor Hour. To access today's notes and receive notice of upcoming episodes, go to Investorhour.com and enter your e-mail. Have a question for Dan? Send him an e-mail at feedback@investorhour.com. This broadcast is for entertainment purposes only, and should not be considered personalized investment advice. Trading stocks and all other financial instruments involves risk. You should not make any investment decision based solely on what you hear. Stansberry Investor Hour is produced by Stansberry Research, and is copyrighted by the Stansberry Radio Network.