The Collapse of Britain's Pound | A DANGER for America.

I wanted to start this video off by

talking about how the Great British

pound is now the Great British peso but

that would be offensive to the peso

because the pound has absolutely

collapsed over the last 24 hours oddly

enough it's not just because the dollar

strengthened the pound lost strength

against major currencies throughout the

world and not only Asian currencies but

even against the Turkish lira and the

Euro but yes it also fell against the

dollar but there's much more to this

story so what what happened like how

could the British pound be down over six

percent in one moment before recovering

some are calling this a 20-minute

sell-off crisis a flash crash say some

Traders as the currency of the British

pound fell to as low as a dollar and

three and a half cents

per pound that's incredibly low we now

have a 63 chance that the pound will be

at a dollar just like the uh a dollar to

the euro sets one to one which is

remarkable because usually the dollar is

weaker than both of these currencies I

remember the days of the pound basically

being twice as expensive as the dollar

as a child and the Euro being at least

50 percent more expensive than the

dollar and now they're both close to one

to one it's really remarkable and these

are the lowest levels for the British

pound since 1985. but this is not just

about the United Kingdom what the United

Kingdom and Great Britain are doing is

kind of really interesting and some are

saying this is potentially what the

United States needs to do so let's talk

about what's going on why the pound is

crashing and why some say maybe this is

what is coming to the United States now

on the other side some do say that these

new policies including the financial

times are just straight up radical and a

quote rebuke to prevailing Western

economic Orthodoxy in other words it's

downright crazy

so let's break down exactly what's going

on now I'm gonna keep this reserved to

just now in this video and then maybe

very briefly at the end but as you know

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posts okay so what's going on well in

September that is this month Liz truss

took over as a prime minister and

started her work and some are saying

this is a danger to the United States

because boy some of the things they're

doing are a little bit of a wake-up call

to the United States that maybe the

United States needs to do this as well

to solve the problems the Federal

Reserve and our government is facing

we'll see so there's this guy who was

appointed to the chancellor of the

exchange kind of like the treasury

secretary by Liz truss his name is

quasi-corte he had three major

announcements that he announced a Friday

and over the weekend added some context

to and these three major announcements

these could be some of the wake-up calls

for the us but I'll reckon reconcile

this as we go through it so first he

introduces his plans with statements

like this is the beginning of a new era

and help is coming and one of his first

policies is something that you would

more likely expect during a time of an

energy crisis where the expectation is

the average household has to spend about

six thousand five hundred pounds on

electoral gas per year or energy per

year I should say that's pretty

remarkable imagine spending somewhere

around 580 a month for gas and let's

just call it and electricity it's pretty

remarkable and so the energy issue is a

crisis on its own but what's said after

the energy crisis is quite interesting

so quickly on the energy prices they

plan to set a ceiling for how much the

typical household is allowed to spend on

energy it'll be capped at about 2500

British pounds and they'll be sending

essentially stimulus checks for 400

pounds this year to a lot of families

and so not only are they going to

support households but they're going to

support businesses with an energy

business relief scheme to reduce gas

bills for all businesses I always think

it's funny that they call plans or bills

schemes in the United Kingdom because a

lot of folks in America hear scheme and

they're like it's a scam

anyway number three uh they they also

plan to support markets in in the energy

space basically by bailing out the

energy sector and their goal is to

reduce inflation to five percent not two

percent no to five percent solely by

attacking these energy crises which okay

I mean that would be ambitious since

you're over nine percent right now and

that got a lot of Applause when that was

announced after all this is the worst

energy crisis they're facing in

generations and they expect to spend

about 60 billion pounds on this and

they're going to be adding to the debt

which we'll talk about what that means

in just a moment yeah I mean in short it

seems like they're doing lots of

borrowing and uh and less uh and then

taking in less money so it's always

interesting how that'll work out but uh

we'll see anyway the big moves and these

were my opinion the things that really

hit the pound but there are also things

that were a wake-up call to the United

States the uh the the chancellor of the

exchange talks a big talk about how they

want to reform the supply chain while at

the same time being more responsible

with their spending and they want to cut

taxes to not only boost growth but

reform the supply chain and encourage

people to work in fact one of the

biggest issues that they're having is

almost exactly what we're having in the

United States where Federal Reserve

chairperson Jerome Powell says look

we've got like two job openings per

person willing to work we need more

people willing to work and so over in

the United Kingdom they're saying hey

well if we need more people to work why

don't we cut taxes for employees and

factories and and businesses so

businesses build more plants buy more

land and people keep more of their own

money boy oh boy that sounds like a

wonderful thing by the way for the

United States and so anyway even though

it's not it just would be nice in the

United States at least it seems that way

there's some issues with this but anyway

he talks about how we have to unleash

the power of the private sector and that

the tax system is not just about raising

revenue it's an incentive structure and

that higher taxes hinder Enterprise and

slow Investments and so we want to make

things easier and simplify the tax code

after all when businesses invest they

make it cheaper for individuals to buy

goods and services and that brings down

inflation I mean just like full stop for

a moment

this is actually really incredible and

really really interesting because that

is not what you see in like modern day

capitalism like here in the United

States or even in Japan where you have

much more of this argument of uh let's

let's and and this is much more in Japan

than even in the United States but

you've kind of got this this spectrum

here uh you know there's there's so much

of a call in the United States that we

got to focus on green we got to focus on

social inclusion we got to focus on uh

diversity we got to focus on on a lot of

things uh like raising taxes to increase

the social safety nets so that way

government can be bigger and do more

when when the United Kingdom is now

saying no let's not have the government

do more let's let business do more

because if businesses do more and people

keep more of their own money they'll

actually want to work and they'll want

to expand their businesses this is

interesting so what are they actually

doing well they're applying some of the

biggest tax cuts in 50 years years

they're keeping the corporate tax rate

at 19 instead of going to 25 percent the

United States is at 21 he says we want

this country to be entrepreneurial we

want this to be a nation of

entrepreneurs I mean these are like huge

statements they want to remove

unnecessary regulations on businesses

and this is an interesting one they

thought they're going to get rid of the

duty-free system for tourists have you

ever been to the United Kingdom or

Europe where they're like oh if you keep

this receipt in this envelope you'll get

your taxes back that you pay they're

like we're getting rid of that paper

system crap and we're gonna do a digital

system because we want to encourage

tourists to come here and we're not

going to raise taxes on alcohol but most

important which is entertaining but most

importantly what they're going to do is

they are going to help people by cutting

their taxes in fact they have an upper

tax bracket of 45 and starting November

23rd they are just killing their upper

tax bracket they're completely getting

rid of it and now the upper tax bracket

will be 40 percent they say they want to

remove this tax bracket that's 45

basically lowering taxes for people who

make more money because they want to

incentivize growth so they don't go into

a recession they want to encourage work

but they also want to reward work and

they think this will benefit the entire

economy and the entire country they say

that high taxes damage the incentive to

work and damage the incentive to buy

homes which they're also reducing some

stamp duties and taxes on many of uh

real estate purchases they're increasing

the no stamp Duty limit from 125k to

250k and for first-time home buyers

they're moving it that is a no stamp

Duty tax from uh 300 000 to 425 000. now

but the most important thing here is

they want to encourage people to work

and invest not only spend money on their

businesses but spend money on real

estate and pay less money in taxes keep

more of their own money corporations to

keep more of their own money but they

also want to kick people in the behind

as well as spend more money now I think

some of these things are remarkable

because they sound really really good

but they want to spend more money on

Child Care immigration digital

infrastructure and physical

infrastructure including roads and

airports and ports at the same time as

simplifying the tax code I mean all this

just sounds like really really amazing

to some degree right but there are

consequences to all this but their

solution for solving the unemployment

problem is probably the most interest

and interesting and probably one of the

most big wake-up calls to the United

States if the United States does this

maybe we could actually solve our crisis

of not having enough workers and wow

this is a brilliant move and I hope that

the United States politicians and the

Federal Reserve are listening to this

listen to what the United Kingdom is

doing so first they say we have more

vacancies than we have on unemployed and

that's the same issue that we have over

in the United States we have too many

job openings you know two job openings

per one person who's unemployed and so

what they're saying is we need to

encourage people to join the labor

market we will reduce pay for unemployed

who aren't fulfilling their obligations

to look for work in other words if you

don't prove you're actively looking for

work your social safety net is going to

start shrinking wow this is intense in

fact their Universal Credit which is

kind of like a social security quote

will face benefit reduction if they

don't work and this quasi guy sounds

very much like Boris Johnson too so like

he leans forward he doesn't have the

hair but he's got the voice with a face

benefit reduction I can't do that I said

it's really incredible but anyway now I

mean just consider all of this I mean it

seems very remarkable it seems like they

want to spend more money on simplifying

the tax code on encouraging tourism on

infrastructure both digital and physical

and increasing child care benefits so

they want to increase all these benefits

while at the same time they want to

encourage growth by lowering taxes on

businesses individuals and real estate

purchasers so it's like spend more money

but bring in less Revenue wow that seems

and sounds really great but it also

seems problematic like how are you going

to balance this mess you've created now

and so anybody who says that the British

pounds crisis and the reason it's

falling is just solely because the

dollar strengthened first of all has not

looked at charts that show the British

pound losing a value against a lot of

currencies across the world and second

of all they don't understand how

absolutely Mega and large the changes

that are coming to the United Kingdom

actually could be now it's a total

experiment because at this kind of time

the way quasi's talking is as if we're

back in the bottom of the pandemic he's

kind of like look we need to do more now

because the risk of doing more now is

lower than the risk of doing too little

I mean those are phrases that we heard

from like Democrats and Republicans in

America during the covet pandemic and

now you're hearing it here all for the

benefit of trying to increase GDP and

create growth it's it's essentially

their their massive growth plan and so

what could actually stand you know to

solve this British pound crisis well

most importantly what you need now is

Andrew Bailey over at the bank of

England which kind of like the Federal

Reserve to wake up last week they only

raised interest rates by 50 basis points

rather than following the FED a day

later and doing 75. at the same time as

having kind of like a soft money printer

stimulative-ish uh Federal Reserve

essentially the bank of England while

taxing less and spending more it awfully

seems like you're trying to debase the

British pound and folks that's exactly

what Traders started pricing in so now

you know the reality of what the heck is

going on and if you like my perspective

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