Former investment banker Carol Roth recently warned in a Blaze Media op-ed that "32 million small businesses are about to get blindsided." She joins Glenn to break down a new rule that goes into effect on Jan. 1, 2024. On paper, the Corporate Transparency Act is marketed as a way to prevent against money laundering. But in reality, the act — which suspiciously only targets the smallest of small businesses — is full of traps that could land entrepreneurs in jail. Carol explains this 2-pronged attack that not only makes operating a small business a legal nightmare, but also sets up "a massive data collection program." Carol also clears up the confusion about what the Federal Reserve's 2024 interest rate predictions would mean for average Americans.
Below is a rush transcript that may contain errors
GLENN: So I was just trying to explain to Stu at the top of the hour we were talking about what you were talking about. And I want to start with what the fed did.
Because right now, if you look at the poll numbers, that are coming out, from all of the swing states, it's pretty dark news, for Joe Biden.
STU: Yeah. New Bloomberg poll that is out today of the swing states. Real quick, we'll go through them.
Wisconsin, Trump 45, Biden 41. Georgia, Trump 49, Biden 43.
Michigan, Trump 46, Biden 42.
Pennsylvania, Trump 46, Biden 44.
Nevada, Trump 47, Biden 44.
North Carolina, Trump 49. Biden 40.
And Arizona, Trump 46, Biden 42.
GLENN: That's not good.
STU: If you're Joe Biden.
GLENN: If you're Joe Biden.
And that comes from Bidenomics.
People are just not believing it.
However, what the fed did, yesterday, by saying, they're going to lower the interest rate three times next year.
Doesn't that mean more free money is coming out. And it will -- it will juice things to make people feel better for the short-term.
CAROL: Okay. So a couple of things. First, what happened yesterday, was they decided they would hold rates steady.
They did something called the dot plot, which is an expectation of the members, of where they think interest rates will be. And from that projection.
It was extrapolated, that that there could be three interest rate cuts next year.
CAROL: Now, that being said, what the members project is always wrong.
So some of -- I know this is shocking news you to.
GLENN: Yeah. Right.
Wow. What a surprise.
CAROL: Now, they're economists. They couldn't project their way out of a paper bag if they tried. So this is an expectation, that if everything were to stay on the trajectory that they think with the same variables today, that they would be in a position, to normalize rates.
And what that is telling you. Is that they think by that point in time, the monetary policy, will have worked its way through the system. That will inflation coming close to their target. Probably not their target. And that they will try to normalize interest rates.
It doesn't mean that -- this particular statement, is it not mean that they're going to print additional money.
It's just a shift in the interest rate.
That being said, there are other factors, that could lead to all of that happening. But this is just, you know, hey.
We have no idea what's going on, but we want you to put something out there. By the way, as you led in with Stu's poll numbers, that could perhaps create some more optimism for people.
To say, oh, well, things are getting better. Maybe you should vote for Joe Biden.
GLENN: Sure. Correct. Correct.
And that's -- you know, this is the one thing that the fed can do. They can raise the interest rates.
They can tighten money. And they can make a politician's life and reelection hell or happy.
It is really -- this is why you don't ever tie these two things together with politics. But they have. They have. So we'll see what happens.
CAROL: They have.
But it's wild. If you think about what's happened, we've been in this massive tightening cycle. And you have the indices. One of them, hitting an all-time high. And two of them getting close back to all-time highs.
That's sort of the opposite, that what should be happening with policies. You have this weird thing of what's going on, where you have this magnificent seven tech stocks, that are at this point, more than a quarter of the S&P 500 is the largest chunk that seven stocks have ever accounted for, in terms of the stock market. In terms of S&P 500 before. And so they are driving the narrative.
You know, if you pulled that out, and you normalize things. Things look very, very different. So you're getting this kind of disparate story. Something that would probably be very different. And look a lot more like last year, if people weren't so all in on AI and all of these promises.
GLENN: Yeah. And so here's the -- by the way, I don't know if you've seen the AI newscast. Have you seen this yet?
Came out yesterday.
Do we even have that? Do we have that polled yet?
No. I just we'll have to do that tomorrow. There's a new AI newscast. All written by AI.
And delivered by AI people that look absolutely real.
And they're like, you know, don't worry about it. There's not going to be any bias. Because we're all computer generated.
Like, oh, that doesn't fill me with confidence.
That doesn't make me feel good. But I digress. Let me talk you to about the other thing.
You wrote a great op-ed yesterday, for -- as a warning to small businesses. This makes no sense to me, if -- if you're trying to do what the government says they're trying to do.
What this looks like, is let's attack the smallest business owners, that we have in our economy. And get them to close their doors.
That's what it feels like to me. Explain what's happening.
CAROL: Yeah. It's part that. And it's part a massive data collection program, that nobody knows about. It's a rule, that goes into effect. January 1st. 2024. That no one in the small business community had heard about.
Was put on my radar by a couple of my great followers over the past couple of weeks.
I had not heard about it.
I was a small business expert, advocate, and someone who owns a small business. Nobody told me about this.
So this is the corporate transparency rule, and what they're trying to gather is beneficial owner information for businesses. And it's estimated that this could impact up to 32 million small businesses.
Including sole proprietors, that have entities. So this is focused on entities.
So if you're a single member LLC or if your business has an S Corp. Even if you don't have employees, you're impacted. And basically, what they're saying, is that you have to register, with a group that's out of the Treasury called FinCEN, which is the Financial Crimes Enforcement Network because they want to prevent money laundering, much in the way that hiring 87,000 IRS deps was meant to go after 800 billionaires. Right? That's exactly what they're --
GLENN: Right. Hang on.
But FinCEN is the group that tagged Hunter Biden that everybody ignored. Right?
CAROL: Correct. That's the irony of the timing here. Is that you have all these flags. Suspicious activity reports and the like for Hunter Biden. And the Biden family.
That were made. And went completely ignored.
But now you want to go after the small business.
And why I say going after the small business. There are all kinds of groups that are exempt.
If you are -- a lot of the different financial services are exempt. I'm guessing because they already have to register with FinCEN.
But if you are a large business and you have at least 20 employees and $5 million in revenue, you don't have to register for this time.
GLENN: Hang on just a second.
So they're going after money launderers.
What kind of crappy money launderer are you, that you're not at least making 5 million?
Hunter Biden made $5 million in one deal. What are you doing it for? You're doing it for snacks? I mean, that's ridiculous.
CAROL: You're money laundering for Doritos or something like that, just for fun and giggles.
And that's what the ridiculousness is. The burden. The invasion of privacy. The collection of small business information, which puts it at risk. Obviously, any time, not only is it a personal invasion of privacy, but it's the potential for cyber criminals to go after it.
GLENN: So what is it that they're collecting on you?
CAROL: So it's called BOI. Beneficial Ownership Information.
And so it's what you might think. It's your name, it's your address, it's all the names you do business under. It's your government ID.
So, again, you don't need ID to vote. But to be a small business, apparently you need one. So something like a driver's license or a passport. And they're going to associate all of that in this national database, so that they can track who is doing business as a small business entity.
And, again, with so many up to 32 million small businesses in this country, the benefit of potentially tracking down a few money launders, which we know, we have one, that they've done absolutely nothing about. Versus the burden this creates, in terms of privacy. There's a fee, Glenn. Surprise, surprise, $85.
And that is, if you don't need to hire someone else to make sure you do this the right way.
GLENN: And if you don't do it exactly right, a massive fine is coming your way, right?
CAROL: So not only fine, but you could also go to jail. There's a jail penalty, associated with not participating in this.
You have to not only do it the one time, which they say the initial burden is three hours. That's assuming that you know how to do this the right way.
Think about three hours, and filling out a form for a small business. That sounds pretty invasive, right?
GLENN: I don't have three hours a day. I don't have three hours to do stuff. You know.
CAROL: It comes them away from revenue-generating productive activity on some nonsense here. And then, by the way, any time something changes, it is up to you, to make sure that you keep them informed.
CAROL: And, again, if you don't do it, in the certain period of time. Well, oh, I forgot. I moved.
Okay. Well, now FinCEN will come out.
GLENN: This is -- this is the way Germany did it.
All dictators do it.
Every time, they go so -- make so many laws, that are on your back. And on your shoulder.
That you -- you could guarantee you're breaking some law, that you may not even know about.
But they've made it so everybody is a law breaker at some level or another.
So you better not step out of line.
You better shut your mouth right now.
Because you think you can't go to jail?
Did you move last year? Did you let FinCEN know about it?
CAROL: You must be a money launder. That $10,000 that you collected as a hobby mom and decided to put in an LLC structure.
GLENN: Let me give you one more thing on this. This is being blamed.
This isn't Joe Biden. This is not Joe Biden.
And it's not. It happened, I believe in January 2020. So Donald Trump was still in office.
It went -- it went to his desk. Both houses voted for it.
It went to his desk. He vetoed it and said it was insanity.
He vetoed it.
It went back. Both houses passed his veto.
And then it was -- it was lost.
So this isn't Donald Trump's fault. This isn't Joe Biden's fault. This is the Congress and the Senate.
I don't know what they're getting out of this. Except more information on you.
But it is wrong.
CAROL: It is. And I think it's something we have to really try hard to repeal. If you're an existing business, you have all year. You have, you know, one full year, in order to comply. If you're a new business. You start a new business, it's 30 days. Old businesses. Existing businesses. Entities. Have the whole year.
GLENN: Where do you even go?
CAROL: Well, I put a statement in, and the last house and small business committee, on the record, that said, this needs to be a top priority.
So the house of small business committee. This is on their radar.
And we need to be picking up our phone. And calling up our representatives. And particularly if you own a small business. And say, this needs to stop.
There is absolutely no benefit to this.
And all it does, it amasses data collection against small businesses. That will make it harder for people to start. And operate. And create more penalties. And shift the landscape, again, in favor of big businesses.
So I am impersonally not going to look at clients until at least the back half of next year, and try to do everything possible, to get this repealed.