When you're doing that kind of back and forth on a topic like the economy, which you have, to me, perhaps I'm naive, but it seems both incredible and incredibly complex. The economy, the trading, the transactions, that these transactions between two individuals somehow add up to this giant mechanism. You've put out a 30 minute video, you have a lot of incredible videos online that people should definitely watch on YouTube, but you've put out this 30 minute video titled How the Economic Machine Works.

That is probably one of the best, if not the best video I've seen on the internet in terms of educational videos. So people should definitely watch it, especially because it's not that the individual components of the video are somehow revolutionary, but the simplicity and the clarity of the different components just makes you ...

There's a few light bulb moments there about how the economy works as a machine. So as you described, there's three main forces that drive the economy, productivity growth, short term debt cycle, long term debt cycle. The former productivity growth is how much value people create, valuable things people create.

The latter is people borrowing from their future selves to hopefully create those valuable things faster. So this is an incredible system to me. Maybe we can linger on it a little bit, but you've also said what most people think about as money is actually credit. Total amount of credit in the US is $50 trillion.

Total amount of money is $3 trillion. That's just crazy to me. Maybe I'm silly, maybe you can educate me, but that seems crazy. It gives me just pause that human civilization has been able to create a system that has so much credit. So that's a long way to ask, do you think credit is good or bad for society?

That system that's so fundamentally based on credit. I think credit is great, even though people often overdo it. Credit is that somebody has earned money and what happens is they lend it to somebody else who's got better ideas and they cut a deal and then that person with the better ideas is going to pay it back.

And if it works well, it helps resource allocations go well, providing people like the entrepreneurs and all of those, they need capital. They don't have capital themselves. And so somebody is going to give them capital and they'll give them credit along those lines. Then what happens is it's not managed well in a variety of ways.

So I did another book on principles, principles of big debt crises that go into that. And it's free by the way, I put it free online as a PDF. So if you go online and you look principles for big debt crisis is under my name, you can download it in a PDF or you can buy a print book of it and it goes through that particular process.

And so you always have it overdone in always the same way. Everything by the way, almost everything happens over and over again for the same reasons. So these debt crises all happen over and over again for the same reasons. They get it overdone. In the book it explains how you identify whether it's overdone or not.

They get it overdone and then you go through the process of making the adjustments according that and then, and it explains how they can use the levers and so on. If you didn't have credit, then you would be sort of, everybody sort of be stuck. So credit is a good thing, but it can easily be overdone.

So now we get into the question, what is money? What is credit? Okay. You get into money and credit. So if you're holding credit and you think that's worthwhile, keep in mind that the central bank, let's say it can print the money. What does that prompt? You have an IOU and the IOU says you're going to get a certain number of dollars, let's say, or yen or euros.

And that is what the IOU is. And so the question is, will you get that money and what will it be worth? And then also you have a government, which is a participant in that process because they want, they are on the hook, they owe money. And then will they print the money to make it easy for everybody to pay?

So you have to pay attention to those two. I would suggest like you, you recommend to other people, just take that 30 minutes and it, and it, and it comes across pretty clearly. But my conclusion is that of course you want it. And even if you understand it and the cycles well, you can benefit from those cycles rather than to be hurt by those cycles.

Because I don't know the way the cycle works is somebody gets over indebted, they have to sell an asset. Okay. Then I don't know, maybe that's when assets become cheaper. How do you acquire the asset? It's a whole process. Okay. Thank you.