Porter Stansberry sat with Tom on the Competent Investor podcast to talk about a book he titled for the year 2029. The hour ran from a medieval king who jailed his creditors, to Social Security, to the Cantillon effect, to a long argument about law and culture, and then back to banks, bonds, Nvidia, and gold. The culture argument is his, and much of it is contested. The investor argument is narrower, and it is the only one this piece will keep.
That idea is this. A higher stock index is not a gain if the yardstick is shrinking. Stansberry says the dollar has been the thing being destroyed, that the Dow measured in gold has fallen hard since 2000, and that the banks are holding bonds they will not mark down until depositors ask for cash. Count wealth in a unit the government cannot print. Do not be the last person in line at a bank that still calls those bonds whole. This is not a recommendation to buy or sell any security, coin, or account.
The king and the unpaid promise
He opened with Friday the 13th, and he did not mean a horror film. Philip IV of France, deep in debt during the wars with England, had borrowed from the Knights Templar. He could not or would not pay. On the morning of Friday, October 13, 1307, his men arrested the order. The charges, in Stansberry's telling, were invented. The point of the parable is not the calendar. It is what a sovereign does when the bill exceeds the chest. He turns on the creditor.
Stansberry says the leading creditor of the United States is not the bondholder. That, he says, is the misconception. The leading creditor is the person who has been promised Social Security. He put the net present value of those benefits on the order of $80 to $100 trillion, with no funding that can match the promise. Those sums dwarf an annual budget. He says the program runs out of money in the early 2030s, and that by 2029 the hole will be so obvious that it sparks a political and economic crisis. Trustees' reports in recent years have put the main trust fund's depletion in that same early-2030s window. The dollar figure and the 2029 spark are his. The direction of the warning is not exotic. A promise larger than the tax base is a future fight over who gets paid in full.
A fight over a promise is an investment fact even if you never read his book. Benefits, bond coupons, and public wages are all claims on the same future dollar. When they cannot all be met in goods, the state can cut the promise, raise the tax, or print the difference. Stansberry's history says the print is the path of least resistance, and that the print is what has already happened. He put the response to the 2008 crisis at something like $7 to $10 trillion created, and the COVID response at about another $7 trillion in 18 months. Treat the round numbers as his magnitudes. The pattern he wants you to see does not require the exact trillion. New currency was poured in. Prices of assets rose. The household that lives on wages did not get the first pour.
The wave does not hit every shore at once
The name for that order is the Cantillon effect. Richard Cantillon described it centuries ago. New money does not raise every price on the same morning. It enters at a door. The people nearest the door spend it before the prices have moved. The people farthest away meet the prices after they have moved. Stansberry's picture is a rock dropped in a pool. In a pool, the wave hits every wall together. In an economy, it does not. He says it reaches big banks first, then insurers, then the wealthy who can borrow ahead of the rise, then the agencies that receive the funds directly.
His exhibit is Loudoun County, Virginia. Before 1971, he said, it was rural and not rich. Since the dollar's last tie to gold was cut, he said, income per person there has compounded at a rate he called 15 to 20 percent a year, and the county became one of the most affluent in the country. Tom added the obvious objection. There is no oil field. Stansberry's version goes further and claims nothing is produced there. That last line is too clean. Loudoun has data centers, contractors, and an airport corridor. What is true, and enough, is that an unusual share of the wealth sits next to the federal spigot. You do not need a conspiracy to see why a paper currency enriches the first recipients. You need a door, and a printing press behind it.
He used his own family as the uncomfortable case. His father was a middle manager at Coca-Cola. His mother taught school. His brother became an engineer at General Electric and builds large turbines, work Stansberry called noble and useful. Stansberry studied history and economics and says he learned to maximize the Cantillon effect. He says he is worth more than $100 million and his brother is still middle class, and that the gap is an abortion of a financial system. He also says he cannot change the system. He can only show readers how to stand closer to the door. He called that ignoble, and he called the monetary machinery untouchable. An investor can reject the self-portrait and still keep the mechanism. Wages in a turbine plant and a portfolio that owns the assets the new currency buys are not the same bet. One is paid after prices move. The other is positioned before they do.
What he says the print has cost
Stansberry's cultural chapter is long, and it is not the investment. He argues that a broken unit of account breaks cooperation, and that desperation follows. He cites gambling, addiction, and a loss of faith in money and in institutions. He cites Griggs v. Duke Power, the 1971 case that let a job test fall because of disparate racial results even without a finding of racist intent. He says the 1991 Civil Rights Act wrote that idea into statute, and that later federal pressure on schools and cities punished discipline and arrests that fell unevenly by race. He names Baltimore, Detroit, Memphis, New Orleans, and Oakland. He offers crime rates, school stories, and college admissions as proof. Those claims are his. Several are sharply disputed. This article does not adopt them as findings, and it does not need them.
The sentence that does belong here is the one about the yardstick. He says not one American in a hundred connects the end of the gold link to the end of the single-earner household. He says a normal life, one job and a paid-for house, stopped being ordinary. You can argue the causes. Trade, housing supply, family structure, and policy all sit in that story. His claim is that the unit of account is the root, because it is the thing every wage is paid in. If that unit is diluted, a higher nominal wage can still buy less of a house. The index can celebrate. The aisle does not.
The bonds are a loss until someone asks for the cash
He then answered the question a depositor should have asked first. What is the risk of a bank run, and why have banks failed in recent years? His answer was not the culture of the branch. He said lending standards were cleaned up after the last mortgage crisis, and that the mortgage market today is mostly healthy, with some dicey FHA loans he would not want to own. The threat he named is the same one that undid his Templars. The government borrows too much, prints too much, and runs deficits that push long rates up.
He said the long government bond has gone from about 2 percent to close to 6 percent in five years, and that mortgage rates are above 7.5 percent. Banks, he said, bought a mountain of debt in 2020 and 2021, when coupons were low. A new long bond at 7 percent is worth far more than an old one at 2 percent. The old bond's price falls. He put the damage at about 60 percent, and he said most banks have not recognized it. On his estimate, Bank of America is sitting on about $150 billion of unrecognized losses in its bond book. Wells Fargo, he said, is in a range of about $60 to $80 billion. The banks' reply, as he states it, is that these are not losses if the bonds are held to maturity. Fifteen or twenty years from now the face value comes back. That reply is true only while depositors leave the money there.
This is the part of the hour that can be checked in spirit, even if his dollar figures are his. After rates rose, unrealized losses on bank securities became a public fact. The accounting label "held to maturity" does not change the price a buyer would pay today. It changes whether the loss is allowed to sit off to the side. A bank can wait out a bond. It cannot wait out a line of people who want their deposits. Stansberry's advice was blunt. Do not be the last person in that line.
The phone is his version of the line
He thinks artificial intelligence makes the line form faster. In five years, he said, you will not park cash at a bank by default. You will hold it on a phone, on a chain, and you will be paid a market rate. If that is safe, why leave money at a bank that pays near zero and carries the bond risk? He says Congress will not successfully tell people where they may keep cash, because that vote is hard to survive. He also says the current system is built on a polite fraud. The bank says the money is safe. It does not say you may lose purchasing power. Ask a plain question, in his example, and a machine will tell you that idle deposits can lose a large share of their buying power over a few years, and will name brokers, card companies, and newer payment apps that pay something closer to a market yield. People do not move the account because the chore is boring. Software that shops the rate every day removes the chore. A system that lives on sleepy deposits, he said, cannot survive awake ones. It will be out of business overnight. That is a forecast, not a calendar. The useful piece is older than the app. Deposits are a loan you make to the bank. If you do not need to make it, do not make it for free.
The buildout is real. The price may not be.
He does not think the AI trade and high inflation can sit together comfortably. One reason inflation is firm, he said, is that the data-center build is a larger commitment, as a share of the economy, than the railroad build was. Every capital wave of that size, in his reading, ends in a bubble and a break. He is not denying the tool. He said AI will change the world the way the internet did. He also said Amazon fell about 95 percent in the wreck after 2000, and that it is naive to think Google, Meta, and Microsoft will not face a serious financial test before 2030. The industry will be overbuilt. He cannot, from today's seat, name the winner among the hyperscalers.
He did name a company he thinks does not lose the build. Nvidia. Gross margins around 80 percent, in his telling, explain why so little profit is left for anyone else. He compared the old internet build, when Intel, Cisco, Microsoft, and component firms each owned a slice, with a stack that now sits mostly inside one firm. Compute, much of the networking, and the software layer, he said, are Nvidia's. He says he has recommended the shares since 2016 and still calls it one of the best businesses he has seen. He is skeptical of the hyperscalers' models and bullish on the firm that sells them the picks. That split is his portfolio, not a finding that the shares are cheap. A company can be the tollbooth and still be priced for a world in which every data center gets finished on time. His own railroad analogy says the tracks get overbuilt. The tollbooth can be the best business in a boom and a bad purchase at the wrong price. He did not give you the price. He gave you the role.
He swapped the bond for the insurer
The permanent portfolio, as he described it, has four buckets. Stocks. Bonds. Gold. Cash. Two years before this interview, when he launched his version, he told subscribers that bonds were uninvestable. He expects long rates to rise for a long time, a decade or more, because the fiscal position makes inflation worse. He does not know the peak. He told the old joke. A bond trader dies, reaches heaven, and God asks what rates will do next year. The point survives the joke. He has been wrong before on timing, and he said so by telling it. What he will say is that the forty-year bull market in bonds looked to him as if it ended around COVID, and that the bear market since is the worst he has seen. He said long bonds have never lost this much capital in American history, down 60 percent and more. That percentage is his measure of the drawdown. It is large enough, on any fair count of the long end since 2020, to have hurt people who thought the bond was the safe bucket.
He still wanted a fixed-income sleeve longer than cash. He pointed subscribers to property and casualty insurers. They own the bonds. They manage the duration. They can shorten when shortening is the job. If the underwriting also makes a profit, the owner gets the bond return plus that profit. He said a model he has run since 2014 at his first research firm has produced about 24 percent a year. Those profits, he stressed, come from owning the insurance equities, not from clipping coupons. The bonds sit on the insurers' balance sheets. You own the bond book indirectly, and only if the company is a good underwriter.
He drew a hard line at life insurance. Tom asked about private equity buying insurers and stuffing the float back into private deals. Stansberry said that problem is a life-insurance problem. A car policy lasts about a year. A life policy is a long promise. Life companies are regulated differently, and he has not wanted to own them. His reason is stark. Everyone dies. There is no edge in underwriting a certainty. A good property insurer can choose risks that do not claim. A life insurer cannot choose customers who do not die. The 24 percent is his track record claim for a model. It is not a yield you can deposit. It dies if the underwriting stops being good. An insurer that reaches for yield in the same long bonds he just called uninvestable has not escaped the problem. It has hired someone to hold it.
The wheel in the cage
He saved the yardstick for the wealth that looks like a record. The stock market has never been higher, Tom said, and the wealth of America has never been higher in the quotes. Stansberry answered with the Dow measured in gold. In that ratio, he said, U.S. equities have fallen about 77 percent in real terms since 2000. The image he used is a pet on a wheel. The market hands you gains. The gains create taxes. You feel motion. You do not leave the cage. Gold's above-ground supply, he said, grows only about 1 to 2 percent a year. Its price is not "going up" so much as the dollar is going down, because more dollars are printed. Those new dollars land in the financial system. Stocks rise. You feel rich. Purchasing power does not.
He then left official inflation behind. If you price the same basket of goods and the same services, year after year, including a specific plane ticket, he said urban inflation in the United States runs between 10 and 12 percent, not 2 or 3. That is his basket, not the index the bond market uses. It is also the entire difference, in his view, between feeling richer and being richer. Gold does not care which basket the government publishes. It cares how many tickets exist for the same ounce. You do not have to accept 10 to 12 percent to accept the method. Pick a real bill you pay. Compare it with the index. If they disagree, the index is a story about the average, and your bill is the audit.
He closed the loop in a way many listeners will refuse. The shrinking yardstick, he said, is the root of the cultural and political volatility, because it disorients people and makes cooperation harder. He said the pattern is old, and that the book walks through Rome. You can reject the leap from the money to every social fight and still keep the investor half. If your stocks are up and your grocery, rent, and tuition are up faster, you did not get paid. You got a higher score on a softer test.
What you can underwrite
You can underwrite the mechanism without underwriting the man. New currency enters somewhere. It does not baptize every wage at once. Assets closest to the door reprice first. A worker paid in the old wage meets the new prices later. That is the Cantillon effect. It is not a stock tip. It is a reason to notice who is allowed to borrow, who is paid by the Treasury, and who is holding cash while that happens.
You can underwrite the Social Security warning as a timing problem, not as a date of collapse. He says the early 2030s for the money, and 2029 for the moment the politics can no longer pretend. The trustees have been pointing at the same decade. A promise that large will be met by some mix of tax, cut, and print. The print is the one that hits a miner, a saver, and a bondholder who thought the coupon was the whole return. You do not have to buy his book to ask which of the three you are exposed to.
You can underwrite the bank point as a question of marks. His $150 billion and his $60 to $80 billion are estimates, not a regulator's schedule. The principle does not need his exact dollars. A bond bought at 2 percent is not worth its face in a 6 percent world. "Held to maturity" is a choice available only while the deposits stay. If you are paid nothing to be the funding, you are volunteering to be early in a bad sense. You are the patient money that lets the mark stay hidden. His line stands. Do not be last.
You can underwrite gold as the rival yardstick, not as a ticker that must rise on your calendar. He says the Dow in gold is down about 77 percent since 2000, and that the metal's price is the dollar's decline. Check the ratio yourself before you adopt the percentage. The habit is the point. If you only look at the index in dollars, you will congratulate yourself inside the cage. An ounce is a bad unit for a grocery run and a good unit for a decade.
You cannot underwrite his 24 percent insurer model as your return. You cannot underwrite Nvidia as the permanent winner because the margins are high. High margins attract the capital that overbuilds the railroads. You cannot underwrite a phone app as the date the banks fail. You cannot underwrite Loudoun County as proof that nothing real is produced near Washington. You cannot underwrite his cultural indictments as the reason to buy or sell a mine. They are a separate argument. The money argument does not get stronger by borrowing them.
What would make this reading wrong
The reading is wrong, on the yardstick, if a real basket of the things you buy rises at something close to the official rate, and if the Dow in gold is not down anything like 77 percent on the dates you measure. Then the cage is his rhetoric, and the index gains are closer to real. Do the division. Do not take the hamster wheel on faith.
The reading is wrong, on the banks, if long rates fall back and stay down, the unrecognized bond losses shrink, and depositors keep getting paid a fair rate without leaving. Then "held to maturity" was a description, not a hope, and the run he expects does not come. It is also wrong, faster, if a few large banks have to sell the bonds into a depositor scare and the losses he estimated show up in capital. Watch the marks when they are forced. They are the audit his maturity story delays.
The reading is wrong, on the build, if the data-center spend stays earned, the hyperscalers' cash covers it, and there is no Amazon-style break before 2030. He said he cannot know which of them wins. A decade of high margins at the chip firm would not, by itself, make every buyer of the stock right. Price still matters. A crisis that never comes would retire the bubble half of his warning. It would not retire the Cantillon half, which does not depend on Nvidia.
The reading is wrong, on the promise, if Social Security is funded in full without a large new print, a large cut, or a large tax. He does not expect that. If it happens, the Templar parable was a mood. If it does not, the creditor the state turns on may be a retiree, a bondholder, or both. The ounce does not settle the politics. It settles whether you were paid in a unit that survived them.
The idea, once
On the Competent Investor podcast, Porter Stansberry told Tom that a broke sovereign turns on its creditors, and that America's largest unpaid promise is Social Security, which he sized at $80 to $100 trillion and timed to a visible crisis by 2029. He said new currency hits banks, borrowers, and agencies before it hits a wage. He said banks are holding COVID-era bonds that are deeply underwater, with Bank of America and Wells Fargo the names he put the biggest unrecognized losses on, and that depositors should not be last in line when a market rate is available on a phone. He said the AI build is real and will be overbuilt, and that he would rather own the firm selling the tools than trust every hyperscaler's model. He swapped the long bond, in his permanent portfolio, for property and casualty insurers, and he said the Dow in gold is down about 77 percent since 2000. His inflation, on a basket he keeps himself, is 10 to 12 percent. Official inflation is not.
A higher Dow is not a gain if the yardstick is shrinking. Count the ounce. Do not be last in line at the bank.
A note on sources and limits
Stansberry's comments are from his appearance with Tom on the Competent Investor podcast, in the transcript used here. That includes the Templar parable, the Social Security figures and the 2029 timing, the Cantillon examples, the family comparison, the disparate-impact history, the bank-loss estimates, the rate levels, the AI and Nvidia remarks, the insurer model and its stated return, and the Dow-to-gold and private-inflation claims. Griggs v. Duke Power is a real 1971 decision. Recent trustees' reports have pointed to Social Security trust-fund depletion in the early 2030s. Those two points are distinguished from his dollar totals and from his cultural conclusions, which this article does not adopt. His "2049" slip on the tape is treated as the book's 2029 frame. Loudoun County's economy is not "nothing." Data centers and contractors are real. Names garbled on the tape are corrected here, including Stansberry and Cantillon.
Nothing here is investment advice or a solicitation to buy or sell any security, metal, or account. Unrealized bond losses depend on rates and on whether deposits stay. Gold ratios move. Insurance underwriting profits are not coupons. A permanent portfolio is a framework, not a promise. Readers should read the filings, the trustees' report, and the book, and should speak with a licensed adviser before any decision.