Herbert Stein

Well, if our democracy holds, and I believe that it will, I think Churchill's observation that America is always does the right thing after exhausting all the alternatives, may prevail again.

Herbert Stein had a famous saying, which was, if something cannot go on indefinitely, it will stop.

And our level of debt, our level of deficits cannot go on forever.

It will stop.

On one hand, simply put, it doesn't seem reasonable that the U.S. can continue forever to spend more than it brings in.

And as economist Herbert Stein once said, if it can't go on forever, it will stop.

You can't argue with that.

But on the other hand, it's hard to figure out what will render the U.S. unable to continue financing deficits by adding to its debt.

And I was like, well, what do you think is going to happen? He's like, I don't know.

He's like, but the economist Herb Stein often says the unsustainable ultimately does not sustain.

Like this is not a sustainable situation.

And so I can't predict how it's going to happen, but I just don't see it.

If you ever ran a model against, you know, where treasury yields would be, where the stock market would be, where the economy would be without all this fiscal largesse, I mean, you'd be surprised.

So as Herb Stein famously said, anything that can't last forever by definition won't.

And this six-year period of fiscal insanity comes to an end on November the 3rd.

And nothing's going to get done.

Yeah, I think, what was it that the economist said? If something can't continue, it won't.

Herb Stein, I think, said that.

And that, I think, is the future we're going to be facing.

We're going to take another break.

I will conclude this bullet point with, The words of a guy named Herbert Simon.

Herbert Stein, I'm sorry.

Do you know who Herbert Stein was? He was an economist.

He was the chief economic advisor to Richard Nixon and Gerald Ford.

His son is Ben Stein, by the way.

I don't think that they they or we have seen it i i just agree with you guys that it's not it's not the same it's not the same as it was in 2021 it's a different era and and there's a lot going on with particularly grading i think that that was a really good point that you made orlando that grading is a mess and that will impact other elements of the hobby and yeah i think i think i don't think we have passed the stress test i think we're still in it so yeah

i will conclude this bullet point with the words of a guy named Herbert Simon, Herbert Stein, I'm sorry.

Do you know who Herbert Stein was? He was an economist.

He was the chief economic advisor to Richard Nixon and Gerald Ford.

His son is Ben Stein, by the way, from remember when Ben Stein's money

There's trouble in the bond markets everywhere, Japan, all the G7 countries, Canada a little less than others, but everywhere.

You may remember an economist named Herbert Stein, a very witty man, and he had many contributions to economics, but the one he was proudest of was what he called Stein's first law of economics.

And Stein's first law of economics was if something can't continue forever, it will stop.

So we've had low interest rates for a quarter century.

We've had ultra low interest rates at many points after 9-11, after the financial crisis, after COVID.

Because the data centers, the hopes for gain are so enormous that they're ignoring the cost of capital.

But everybody else in any conventional line of work is not ignoring the cost of capital.

And probably, Stein's first law of economics again, the data centers can't ignore the cost of capital forever either.

Yeah.

Herbert Stein, a counsel of economic advisors under Nixon, famously crafted what's called Stein's law.

If something cannot go on forever, it will stop.

As you rightly point out, that can't happen.