Dave Ramsey, financial expert and host of ‘The Ramsey Show,’ joins Glenn to discuss how fear of our unknown future may be affecting how some Americans invest or plan their finances today. It’s always best to assess risk in the marketplace, Ramsey explains, but ‘when the fear kicks in it coats your brain and lowers your critical thinking skills.’ Plus, Ramsey describes the three components of inflation we’re experiencing today, and he predicts how much further inflation may go…

Transcript

Below is a rush transcript that may contain errors

GLENN: So if it isn't Dave Ramsey. Hi, Dave, how are you?

DAVE: Great, my friend. How are you is this?

GLENN: I'm very good. But I do want to thank you for the pleasure of having my wife come home, who listens to you every day, and say, honey, see, I told you, you were crazy.

Dave Ramsey said you were crazy. Thank you for that, Dave.
(laughter)

DAVE: Any time, my friend. I am just here to help. I'm a big Glenn Beck supporter.

GLENN: Yeah, no. No. We don't even have to go down this road. We are good friends. We have been for a long time. I have a lot of respect for you, and I know it goes the other way. Here's what I do want to do. You were talking about the Great Reset.

You're in a different business, really, than I am.

You give financial advice. I don't. I always say, this is what I'm doing. But don't listen to me. Because I have no idea, what I'm talking about.

I wanted to get from you, what you think The Great Reset is.

DAVE: Well, the irony of this is, is that both our books came out the same day. January the 11th.

GLENN: Yeah. That's right.

DAVE: And both of them were on the best-seller list, at the same time.

Baby steps, millionaires. That actually started this conversation this morning too. Because what happened, a guy followed our baby steps, and became a millionaire.

Completely out of debt.

Has a net worth of $100 million. Calls in. And says, hey. I'm thinking about not investing anymore, because of the Glenn Beck reset. That's what started --

GLENN: Hold on. Hold on. Just a second. First of all, it's The Great Reset. Not the Glenn Beck reset. And I have never said that. I still -- I said, if you are concerned about it, spread your money out as wide as you can, because I don't know what will hold.

But I still have my house. I still have money in the stock market. I'm very careful on who I invest with. I don't want to invest with BlackRock. Although, if you want to make money, that's what you should do.

If you want to make money.

DAVE: Well, if you have no principles.

GLENN: Yeah.

DAVE: So, you know, no. I'm not an expert on the great reset.

You are. You wrote the book on it. And diversification, what you're talking about there. Spreading your money out.

The Bible says, spread your portions to seven, yes, to eight. For disaster, make them upon -- diversification is the oldest financial rule ever. Never put all your eggs in one basket. Some dude has the basket, and he's been smoking pot. Do not put all your eggs in one basket. Correct?

GLENN: Correct.

DAVE: So that's what we're talking about. And, certainly, we would espouse that as well. What I was trying to do was keeping the guy from freaking out. Becoming scared that the world was coming to an end, and trashing all his investments, that caused him to become a millionaire in the first place.

GLENN: Yeah. So, Dave, this is one of the reasons why I'm thrilled to have you on. Because honestly, you know, I don't know if you know what stakeholder capitalism is. But that's the driving force, or the theory behind The Great Reset.

And you've got the Treasury. You have Yellen saying, this is what we're doing. We're going to have stakeholder capitalism. That's 21st century fascism.

And if you don't mind, not telling your school board, I think you're wrong.

Then you're not going to have a problem with ESG scores.

But you have to play ball, exactly the way, they are telling you. Down the road. With digital money, which is something that the executive order came out last week on.

And so I don't know what it's going to look like on the other side of this.

I have no idea. What's going on. I do know, just with inflation, we have got to batten down the hatches. So what should people do, to batten down the hatches?

DAVE: Well, when we go back in history, the thing we always want to avoid. We always want to be safe. We always want to assess risk in the marketplace. What you want to talk about. We always want to be wise then. The storms are coming. We perceive a storm. Here's where people get crazy. When the fear kicks in, it coats your brain and lowers your critical thinking skills, and they go nuts.

And so I'll give you an old example, I was thinking of this morning, knowing I was going to be on here.

In 1982 Peter Crase (phonetic) was put on the Grace Commission by Ronald Reagan, to study government overspending.

And the deficit, and the damage of the deficits. His cochair on that was a guy named Harry Figgie.

Both of them were billionaires at the time. And Figgie wrote a book later that year, called Bankruptcy 1995, predicting the end of the American economy as we know it because of the deficit increase. Apparently, he was wrong.

Larry Burkett wrote a book called The Coming Economic Earthquake that was predicted in 1992, the world was going to come to an end, and the economic crisis was going to cause America to end as we know it. And, apparently, was wrong.

My good friend, Robert Kiyosaki who wrote a wonderful book called Rich Dad Poor Dad, wrote a book called Rich Dad's Prophecy, where he predicted the end of the stock market as we know it in 2016. Apparently, he was wrong.

So I don't want people to not invest because of fear, by going -- swinging the pendulum too far to the other side. But it is wisdom, there in the middle, to say, hey. I don't like what's going on. I smell fascism. I smell Fauci running the economy. You know, I'm a Libertarian. Leave me free.

Because a free man will drive an economy. But when you start tinkering around in the background, in the back rooms with these things, is there something to be concerned about?

Sure. So you have to be wise about it. But don't oversteer the car, and flip it.

GLENN: Absolutely.

But let me ask you a couple of things.

First of all, I was called a fearmonger in 2006 and '7, when I said, this housing stuff, with the banks, it doesn't work.

There's going to be a collapse. Everybody called me crazy.

As he know, what happened was the crash of 2008. Now, it wasn't as bad as I thought. And that is only because of TARP.

Which was something that is absolutely unconstitutional. And unthinkable, before that crash.

DAVE: No question. No question.

GLENN: Now, I haven't read Kiyosaki's book, but I know him and I respect him.

DAVE: He's the guy.

GLENN: But there's a difference between the end of America and the end of, as he said, the stock market, as we know it.

Because I look at the stock market today, and it makes no sense. We're closing down all of -- you know, all businesses in America, and the rest of the world?

And the stock market continues to go up?

That's not the stock market that I know.

DAVE: Well, the stock market on the short-term is driven by profits. And profits are very, very real right now. In spite of all the economic crap out there. The profits are very real.

But to predict the end of the stock market. Is to predict every household name, that we know of, evaporating.

GLENN: Right. Right.

DAVE: Home Depot. Microsoft. Apple. McDonald's. Coca-cola are all zero. That's the end of the stock market. That's the end of America.

GLENN: Yes, it is.

But what I'm asking you is, the end of the stock market as we know it. I don't know what he wrote. And maybe he wrote, it will be at zero. I don't believe that.

I believe there are companies that will -- just like in the Great Depression. Companies that will fall away. Companies that are tried and true. And rock solid. And they will continue.

DAVE: Yeah. Well, any time stupid is stress tested. We get to see it's stupid. So that's what happens.

I think in '08, maybe you and I were arguing about gold if you remember. Or I was arguing with somebody about it, because everybody was buying gold in that crash. And I just pulled this up a minute ago.

I told people, don't buy gold. I've always told them not to buy gold.

So in the last 10 years, gold had a 3.71 percent rate of return, and the stock market has had a 12.2 percent rate of return.

GLENN: So I don't --

DAVE: Don't buy gold.

GLENN: Well, I disagree with you. The 3.5. When I started talking about it, it's up 10X. However, I don't buy it as my get rich thing. And I say this all the time. I don't buy it for investment. I buy it for insurance against insanity. It's the same reason why China just purchased 220,000 tons of gold. In the end, when the madness of printing becomes clear, the world generally resets, to some sort of a commodity, usually gold.

That's what they're doing now, in China.

DAVE: It completely melts down, it resets to a barter economy. Then a currency will erupt. And you will see that, on a completely collapsed economy. Venezuela or Nazi Germany, when hyperinflation. And it was a wheelbarrow load of money to buy a loaf of bread. So you have hyperinflation kick in. What happens is, currency is based on trust. So it's actually a spiritual animal, in that sense.

And so when you quit trusting that a piece of green paper, with the president's face on it, will buy something. Then you have to trust that something else will work.

And if you trust gold will work, that's fine.

But in a completely melted down economy, people really want bullets, water, blue jeans, and gasoline.

GLENN: So what do you say about the reset of a currency? Which Russia and China are doing clearly, trying to take the petrodollar apart.

So half the world would go that way if their plan would work. And a reset to a digital dollar.
DAVE: Well, it can happen. Again, the thing that has to happen for these things to occur is trust has to evaporate.

You have to no longer believe -- when a certain number of people believe that a bitcoin is worth something, that's the only thing that makes it worth something.

It has no intrinsic value. Actually, a bar of gold has no intrinsic value. Any more than a piece of paper does. It's when people are fighting over it. Arguing with it about. Negotiating for it, that gives it value. That's the trust factor.

You can move trust around in currencies. And that's why -- and I don't recommend trading currencies. I don't trade currencies. But if you will trade on the yin, you would say, all right. What is the outlook for China's economic conditioning?

GLENN: Right. So I'm not talking about trading currencies. I'm talking about the trading of currencies.

DAVE: Well, it's the same thing.

GLENN: The average person loses about 40 percent on their dollar. If you read Yellen. Yellen is talking about, this time it will be different because it will be an equitable exchange, when the new currency would be introduced.

Which scares the hell out of me.

DAVE: Sure. That's all socialism language. That's just BS. The thing that will happen --

GLENN: Wait. Wait.

When you say BS. You mean, it will not happen.

DAVE: She does not have the power she thinks she has. There's too many of us that really trust and believe in the free enterprise system. That really trust and believe in America for a couple of -- handful of socialists to actually run the dadgum thing. We're not going to tolerate it.

You think people would have stayed in their houses much longer off of Fauci? We were about done, boy? I mean, we were all about done, weren't we?

Were we about to come out of our houses with pitchforks and torches?

GLENN: I don't know. I live in Texas, so it was fine. I live in Texas, so it was fine here. But I think the rest of the country was.

DAVE: Yeah. If we go to back to work, and I was trying to kill my employees. So it was nutty. Just nutty. So the bottom line is, there are enough critical thinkers out there that are capitalist, that do believe in this.

That it's harder to take over the world than it sounds, in my opinion. I don't know. It's a fun discussion, because I love you. You have such a great brain. I love talking to you about this stuff. And, again, if we know it's a friendly territory, because we've got so much respect for each other over the years.

But so I think that I'm not going to write a book, that predicts a crash.

Because I've seen too many books written.

GLENN: Written. Sure.

DAVE: And I'm not predicting that on you, by the way. I'm just saying, I'm not going to change my investment strategy, dramatically, because I am fearful of the world as we know it, to quit operating.

GLENN: Well, I will tell you, that there's a lot of people out there, that having advice. That I think are morons.

I agree with your advice.

Because you are built around, get out of debt.

DAVE: Yeah. Sure.

GLENN: And there's nothing that you could do, that is better for preparedness, for any eventuality. Good or bad.

DAVE: And the funny thing, that works when you're prospering, and the economy is going bonkers good. And it works when there's really bad times. And these people in control are fascist and nutty.

It's hard to foreclose under my house, under current law, when I don't have a mortgage.

GLENN: Real quick.

I only have about a minute. Minute and a half. Your thoughts on inflation?

DAVE: There's two components to it right now.

The energy component is 100 percent on Biden's desk. He's completely screwed the pooch on this.

It's a supply/demand problem. He cut the faucet off, trying to be all greeny, and he drove gas prices through the roof.

He single-handedly did it. It's an administrative nightmare. There's another portion he had nothing to do with, but he's getting blamed for. And that was, we shut everything down, factories and everything for 90 days. Or 120 days. Or six months.

And we screwed up the supply. Then we screwed up the supply chain. Then there was an earthquake at sea, and when the tsunami hit, it was everybody came out and started buying stuff, and there wasn't any stuff to buy.

So the supply/demand curve drove prices through the roof. That wasn't his fault.

Then the third piece is the labor disruption.

Part of that is his fault, because he paid people to sit on their butts at home, when they should have gotten back to work.

If they had gotten back to work, we could have gotten the economy moving again in a proper way.

Instead, they're coming back. We're paying people $20 an hour at Target. Guess what, Target marks up the price of those goods on the shelf, to govern the $20 guy putting them on the shelf. So you're paying for his living wage.

GLENN: How much -- how much worse does it get?

DAVE: Yeah. I -- you know, I think it's going to smooth out pretty quick. The energy thing is the most disturbing. He could be controlled. He could fix it really quick. But he's not going to.

GLENN: Dave. I love you. Dave Ramsey. I mean, I disagree with you on almost all of this. The name of his book is Baby Steps.

DAVE: Agree with. What good say friend you agree with all the time?

GLENN: Baby Step Millionaires is the name of the book. It's a New York Times best-seller. As if that means anything anymore.

DAVE: No, it does not.

GLENN: Baby Steps Millionaires. If you've never listened to the show, you should. It's a great way to get your house in order. Dave, thank you very much. God bless.

DAVE: Love you, bro. Be good.