Introducing the latest bubble about to burst: The Money Bubble

Glenn has been warning for some time that our current system is unsustainable and simply cannot last. Today Glenn saw a chart that should strike fear into every American citizen. It shows the latest bubble that appears to be approaching the moment where it will burst -- the money bubble.

On Sunday, USA Today published a article by John Maxfield from The Motley Fool, featuring a terrifying chart showing the internet bubble, the housing bubble, and an unnamed bubble that Maxfield said was being called a stock market bubble.

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Now, Maxfield's article doesn't say there is a stock market bubble happening in the United States. He explains, "the fact that the Fed's monetary policies have caused stock prices to soar, doesn't mean there's a bubble."  He does say, however, that they will most likely deflate as part of an overall correction.

Now, why does Glenn think the above chart is so important?

"I'm not sure if the stock market bubble and the money bubble will be exactly the same, but I think they are. It's being propped up by bogus money. You are borrowing money from the Fed at zero interest rates, and that money is worthless. It's not backed up by anything. And when we really do hit the money bubble, we're out. We're out."

"I wanted to show this to you, because for those of you listening to me for a long period of time, you know I'm wrong on timing. I'm always wrong on timing, but I'm not wrong usually in direction," Glenn said.

Later in the show, Glenn pulled out the transcript from March 2008 when he was on Headline News where he described how "the money bubble" would come about and collapse.

"If you see what was in USA Today, you will see that they are now talking about the money bubble. We built a bigger bubble than that housing bubble in 2008. Remember when we said if we don't fix this, this will get much, much worse? And when it gets much worse, when it finally pops, what do we do as a people?" Glenn asked.

Way back in 2008, Glenn warned that the policy of the Federal Reserve could result in a "money bubble". The transcript from that segment is below via CNN.com:

BECK: Welcome to the real story. I want you to look at your newspaper today and you will see all kinds of headlines in there trumpeting the great news that home sales were unexpectedly higher in February. Hey, that`s great, until you start looking under the hood of those headlines, you`ll find a very different story. Yes, sales were up slightly in February, but they were down nearly 24% from last year. And prices, which are now just a little more important are now down 11% from last year, biggest drop in the history of the S & P index. I know, details, details, shut up guy on TV.

The Dow now was up another 180 points yesterday, nearly 8% in the last nine trading days alone. I mean, that`s great. Everybody`s happy, what recession? If I may introduce you, one more time, I`m sorry to do this to Mr. Gloomy Pants. The real story is that we are now witnessing the birth of our next bubble. Just like communists, financial bubbles don`t ever go away, they just change their look.

The internet bubble shaped, shifted into the housing bubble and then the housing bubble has now shifted into something, I`m officially declaring, the nanny state money bubble. For the last few years, America has been, if I may, on a Las Vegas binge. Wall Street would be, were like out with hookers every night, Main Street doing blow and eating caviar off of somebody`s belly and then the bill claim and we just handed over our credit card. You take American Express? Then the party ended and the bills started to come in. And you know, we didn`t go home because the bill collectors were waiting for us at the front door. We just stood there in the bar and now we`re holding our hands out.

You know, looking, hey, Paris Hilton, she by the way in this analogy is playing the federal government, Paris Hilton, you`ll cover us right? Well, for now, Paris Hilton is happy to do that. She is cutting rates. She is bailing out company. She is printing out money in the basement, anything to make us all forget that the open bar is now over. But sooner or later, we`re all going to realize, wait a minute, Paris Hilton is not only unemployed, but her credit is actually worse than ours is. She doesn`t have any cash and more importantly, she has no ability to earn any cash. She`s been paying our tab by borrowing money, in fact, Paris Hilton, I believe, is the perfect analogy for this economy, neither have any real substance and both look far better in night vision, I`m just saying.

Bruce Bartlett this is former U.S. treasury official. Bruce, you`re kind of regretting coming on this program after I just equated the economy to Paris Hilton.

BRUCE BARTLETT, FORMER U.S. TREASURY OFFICIAL: Wow.

BECK: The federal government, aren`t you? You can be honest. That`s OK.

Bruce, tell me, the Fed is printing money, dumping money, the government is. Everybody is doing this. The stimulus package. They`re now looking for more, they`re bailing out companies and now they want to bail out borrowers. How do you -- this is bogus. What`s happening here is bogus money. There`s no real creation of anything here except debt.

BARTLETT: Look, the Federal Reserve, basically, is responsible for all of these bubbles and credit cycles, whatever you want to call them because it always overdoes things. You know, when the economy is hurting, it shovels money out any way it possibly can, and then they just keep shoveling more and more because they`re never sure that they`ve done enough because there`s always enormous political pressure to do something. And then eventually, you get inflation, they start to tighten. They always tighten a little too much. And so you`ve always got this boom and bust cycle that basically, I think, comes back to the Federal Reserves` money creation policy.

BECK: Here`s the problem. It seems to me that we are always popping a bubble. And in retrospect, you always go back and go, yes, $900 a share for pets.com. That wasn`t such a smart idea. It all makes sense after you get past it. How is it that nobody is seeing that the Fed right now is dumping money or shoveling money, as you say, but they`re not paying attention to inflation at all. What they`re doing is going to cause more inflation and then they got a really Sinbad belt tight, you know, tighten the belt on us to the point to where it`s going to hurt the other direction.

BARTLETT: Well, the problem is what the Fed does to the economy always takes -- there`s always a lagged effect. What the Fed is doing today will ultimately impact on the economy two years from now. But by then, people will have forgotten that that was the root cause. By then, they`ll talk themselves into believing it`s something else all together. Remember, Alan Greenspan gave his famous irrational exuberance speech about the tech bubble in 1996, but it wasn`t until 2000 that the bubble finally burst.

And in the meantime, people talked themselves into believing it wasn`t really a bubble that it was all real.

BECK: I get it.

BARTLETT: And the same thing in the housing sector.

BECK: I have to tell you, it`s like we`re taking political rufies all the time but we just what? I don`t remember that at all. Bruce, thanks a lot.

 

Reform Conservatism and Reaganomics: A middle road?

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Senator Marco Rubio broke Republican ranks recently when he criticized the Tax Cuts and Jobs Act by stating that “there's no evidence whatsoever that the money's been massively poured back into the American worker." Rubio is wrong on this point, as millions of workers have received major raises, while the corporate tax cuts have led to a spike in capital expenditure (investment on new projects) of 39 percent. However, the Florida senator is revisiting an idea that was front and center in the conservative movement before Donald Trump rode down an escalator in June of 2015: reform conservatism.

RELATED: The problem with asking what has conservatism conserved

The "reformicons," like Rubio, supported moving away from conservative or supply-side orthodoxy and toward policies such as the expansion of the child and earned income tax credits. On the other hand, longstanding conservative economic theory indicates that corporate tax cuts, by lowering disincentives on investment, will lead to long-run economic growth that will end up being much more beneficial to the middle class than tax credits.

But asking people to choose between free market economic orthodoxy and policies guided towards addressing inequality and the concerns of the middle class is a false dichotomy.

Instead of advocating policies that many conservatives might dismiss as redistributionist, reformicons should look at the ways government action hinders economic opportunity and exacerbates income inequality. Changing policies that worsen inequality satisfies limited government conservatives' desire for free markets and reformicons' quest for a more egalitarian America. Furthermore, pushing for market policies that reduce the unequal distribution of wealth would help attract left-leaning people and millennials to small government principles.

Criminal justice reform is an area that reformicons and free marketers should come together around. The drug war has been a disaster, and the burden of this misguided government approach have fallen on impoverished minority communities disproportionately, in the form of mass incarceration and lower social mobility. Not only has the drug war been terrible for these communities, it's proved costly to the taxpayer––well over a trillion dollars has gone into the drug war since its inception, and $80 billion dollars a year goes into mass incarceration.

Prioritizing retraining and rehabilitation instead of overcriminalization would help address inequality, fitting reformicons' goals, and promote a better-trained workforce and lower government spending, appealing to basic conservative preferences.

Government regulations tend to disproportionately hurt small businesses and new or would-be entrepreneurs. In no area is this more egregious than occupational licensing––the practice of requiring a government-issued license to perform a job. The percentage of jobs that require licenses has risen from five percent to 30 percent since 1950. Ostensibly justified by public health concerns, occupational licensing laws have, broadly, been shown to neither promote public health nor improve the quality of service. Instead, they serve to provide a 15 percent wage boost to licensed barbers and florists, while, thanks to the hundreds of hours and expensive fees required to attain the licenses, suppressing low-income entrepreneurship, and costing the economy $200 billion dollars annually.

Those economic losses tend to primarily hurt low-income people who both can't start businesses and have to pay more for essential services. Rolling back occupational licenses will satisfy the business wing's desire for deregulation and a more free market and the reformicons' support for addressing income inequality and increasing opportunity.

The favoritism at play in the complex tax code perpetuates inequality.

Tax expenditures form another opportunity for common ground between the Rubio types and the mainstream. Tax deductions and exclusions, both on the individual and corporate sides of the tax code, remain in place after the Tax Cuts and Jobs Act. Itemized deductions on the individual side disproportionately benefit the wealthy, while corporate tax expenditures help well-connected corporations and sectors, such as the fossil fuel industry.

The favoritism at play in the complex tax code perpetuates inequality. Additionally, a more complicated tax code is less conducive to economic growth than one with lower tax rates and fewer exemptions. Therefore, a simpler tax code with fewer deductions and exclusions would not only create a more level playing field, as the reformicons desire, but also additional economic growth.

A forward-thinking economic program for the Republican Party should marry the best ideas put forward by both supply-siders and reform conservatives. It's possible to take the issues of income inequality and lack of social mobility seriously, while also keeping mainstay conservative economic ideas about the importance of less cumbersome regulations and lower taxes.

Alex Muresianu is a Young Voices Advocate studying economics at Tufts University. He is a contributor for Lone Conservative, and his writing has appeared in Townhall and The Daily Caller. He can be found on Twitter @ahardtospell.

Is this what inclusivity and tolerance look like? Fox News host Tomi Lahren was at a weekend brunch with her mom in Minnesota when other patrons started yelling obscenities and harassing her. After a confrontation, someone threw a drink at her, the moment captured on video for social media.

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On today's show, Pat and Jeffy talked about this uncomfortable moment and why it shows that supposedly “tolerant" liberals have to resort to physical violence in response to ideas they don't like.

President Donald Trump has done a remarkable job of keeping his campaign promises so far. From pulling the US from the Iran Deal and Paris Climate Accord to moving the US Embassy to Jerusalem, the president has followed through on his campaign trail vows.

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“It's quite remarkable. I don't know if anybody remembers, but I was the guy who was saying he's not gonna do any of those things," joked Glenn on “The News and Why it Matters," adding, “He has taken massive steps, massive movement or completed each of those promises … I am blown away."

Watch the video above to hear Glenn Beck, Sara Gonzales, Doc Thompson, Stu Burguiere and Pat Gray discuss the story.

Rapper Kendrick Lamar brings white fan onstage to sing with him, but here’s the catch

Matt Winkelmeyer/Getty Images for American Express

Rapper Kendrick Lamar asked a fan to come onstage and sing with him, only to condemn her when she failed to censor all of the song's frequent mentions of the “n-word" while singing along.

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“I am so sorry," she apologized when Lamar pointed out that she needed to “bleep" that word. “I'm used to singing it like you wrote it." She was booed at by the crowd of people, many screaming “f*** you" after her mistake.

On Tuesday's show, Pat and Jeffy watched the clip and talked about some of the Twitter reactions.

“This is ridiculous," Pat said. “The situation with this word has become so ludicrous."