The Tucker Carlson Show
Gold, Crypto, the Debt Crisis, and How to Survive When the US Needs a Bailout
26 Dec 2025
Chapter 1: What is emerging markets debt and how does it relate to U.S. foreign policy?
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Chapter 2: How does the IMF influence American foreign policy?
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Chapter 3: What is the impact of the Federal Reserve on free market capitalism?
The financial dynamics of the world drive a lot more than we acknowledge that they do. And we look at things, we're like, oh, these people believe this and these people believe that. And that's why they're fighting or that's why they're allies or whatever. But really, we should all remember that the love of money is the root of all evil. And money really has a huge effect on outcomes.
But nobody says that. And I miss it so often. So you spent your life in the money business, trading debt. Uh-huh. Tell us just to start, but like you worked in Ukraine. You traded Ukrainian debt.
What was that like? I never worked in Ukraine. I've been to Ukraine on investor trip. I have traded Ukraine debt. I traded emerging markets debt my whole life until May of this year. I traded and sold it at a bunch of different banks, London and New York. Ukraine was certainly one of the... One of the insurance we traded, traded through the Russia crisis.
Can you explain, just for the truly ignorant me among them, what is emerging markets debt?
So emerging markets debt, originally the asset class grew out of the debt crisis in the 1980s when money center banks were hung with primarily Latin America debt after the crisis.
uh after the 80s crisis um nicholas brady treasury secretary at the time came up with a plan called the brady plan to restructure the debt back it with collateral u.s treasury strips that would make it more palatable to a broader base of investors to get it off the balance sheets of the money center banks
and to create a more of an institutional uptake of the debt and retail uptake of the debt so american debt american banks are left with loans from other countries that those countries can't repay correct i'm just trying to put it in terms like i can understand and so then the treasury secretary basically says to those banks we'll bail you out by guaranteeing these loans with american treasuries
It's one way to put it. It's a way to clean the balance sheet up and to create, I think there are two impacts. One, you clean up the bank's balance sheets, get it off their sheet and create a marketplace and a dynamic balance. that allows liquidity for this debt and then creates a whole new marketplace and ability to issue and clean up the country's balance.
So you're doing good for the banks and you're doing good for the countries and theoretically doing good for a whole new investor base. And that started in the early 90s and I kind of walked into Wall Street in the early 90s out of college and I just fell into this market that was starting and really boomed for a while.
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Chapter 4: What alternatives are available to investing in the stock market?
down to corporate debt, all the way down to defaulted debt. So it's all of credit, all credit products in a number of countries, it's ballooned. But at the infancy, it was really a, it was a evolving asset class to kind of clean up the balance sheets and open access back to lending to these countries. And instead of just being relied on major money center banks,
for loans that really sat on their balance sheet and weren't that liquid didn't trade much let's open it up to a global investor base create trade euro bonds put in your uh uh not necessarily putting your 401k but put in your pension funds and then hedge funds traded it and from there it evolved from dollar debt into the local currency debt became much more fashionable uh so investors can buy turkish lear denominated debt or
Chapter 5: Is cryptocurrency a viable option as a global reserve currency?
Kenyan shilling denominated debt, and then obviously derivatives. You can buy Kenyan debt in Kenyan currency? You can. It's not that easy, but the harder it is to trade, the more the banks make money at trading it. So certain countries are harder to access than others.
So all of this debt originates from the desire of countries to raise money from the world. Correct. So if I'm Kenya and I want to fund the operations of my government, I issue bonds?
Yep. You issue locally, issue local bills to local banks primarily, local bank treasuries. Foreign investors can access that through... typically plain vanilla kind of derivatives, and they'll issue dollar-denominated Euro bonds that are open to the world to trade in dollars.
So if you're the Treasury Secretary, that's a huge power that you have. You can bailing out other countries. Certainly.
I mean, I saw it, my first job... And for about a year, I was an analyst on a trading desk. And like six months in, they gave me a trading book, the Mexico book. It was 1994. And they gave it to me because I was a kid and it was the safest book. You couldn't hurt yourself too much with it. About six months after that, the Mexican peso crisis hit. So yeah, that was Robert Rubin and friends.
I lived through that whole experience of the ballot. What did they do? What did who do?
What did Rubin, then Treasury Secretary, what did, under Clinton, what did he do with the Mexico crisis?
Well, what's interesting is, I don't know if it's a, it's a function of just how the human brain works. And you look back and you're like, oh yeah, we basically bailed Mexico out and cleaned it up and everything went on as it was. But you forget as you're going through that, These things all take a lot longer. Your memory shortens up. It took a lot longer and it took a few go rounds.
And what I learned through that whole thing was, because I went through a bunch of these crises, there was the 94 Mexican peso, 97, the Asia crisis, Thai bot. I don't know if you remember Thai bot crisis and Korea chai balls and all that. And then 98 was Russia. 2000 was Argentina peso crisis. And then we had the, you know, GFC.
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Chapter 6: How do debt crises manifest in emerging markets?
And, you know, the IMF, it's funny, I've been, you mentioned Ukraine and the trip I went to Ukraine was an investor trip. And part of the purpose of an investor trip is to go and to meet with their finance ministry, their debt liability people, meet with banks, meet with locals, etc. get an assessment.
And, you know, you go to, you always go to the IMF there and ask what the likelihood is of the next tranche being delivered. And, you know, perhaps it's a bit cynical, but 30 years of trade in merchant markets will make it pretty cynical. But I'd always go into those meetings and walk away from those meetings like, well, what are we talking about here?
Of course they're going to disperse the next tranche. That's what they're in the business of doing. They're in the business of lending money to these countries because that's what they do and that's where they make their money.
So it's very rare that they won't or they don't unless it's a real sort of turn your thumb up, turn your nose up or thumb your nose at the IMF and- Is the purpose of the IMF to bail out-
mismanaged countries i think it's simple terms yes i don't think that's the i don't think that's the most euphemistic way of putting it or how they describe it but effectively yes i'd say backstop or keep them keep them afloat and to offer them uh guidance as to how to run austerity programs and get themselves back on the rails so that they can move towards
prosperity democracy all this does it work uh typically no why uh because one uh it's very politically unpopular as a domestic politician to be taking orders from any foreign power but certainly uh the west and those orders come with
strict austerity because how did they get themselves in those problems in the first place right um a certain a distinct lack of austerity living beyond their means correct so you know that's not that's not uh it's not particular to emerging markets countries all sovereign all sovereigns do that right everyone in the west is doing that as well now right um living beyond their means
But some of us like the United States are able to run what's called counter-cyclical monetary policy because we have a reserve currency.
So we have a special privilege to be able to maybe be somewhat more profligate than others, but the money runs out a lot faster in emerging markets countries when you can't finance your debt and you have a dual crisis of both your currency and your interest rates running out of control.
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Chapter 7: What role does the U.S. play in bailing out foreign economies?
And then it's impossible to fix because their democracy is trying to meet the demands of their voters.
That's probably a little more euphemistic than I would say. Yes, that's one factor, but there are other factors at play as well.
How many countries have been bailed out by the United States over the past 30 years that you're aware of?
I mean, there's hard bailouts and soft bailouts, so I couldn't really put a number on it. How many are running an IMF program right now? It would have to be in the dozens. How many strict bailouts? I really don't know off the top of my head.
I mean, we can go through the, we can go through obviously Mexico, Argentina, excuse me, Argentina, um, in the, in the, in the Asian crisis, there were a whole host of Asian countries that had to post up. Um, so there's, there's the hard bailouts and then there's like the softer bailouts are sort of coming back, staying on the, staying on the, the teat, so to speak. Who makes money from this?
uh who makes money from this so the imf theoretically makes money uh from the interest on the loans but it's typically below market loans so it's it's not a real profit motive um banks make money from this from facilitating the debt so the trading of it the issuing of it the fees of issuing of it um
investors make money um from higher interest rates obviously um and then there's a subset of investors like distressed debt investors that will um buy a bunch of defaulted uh defaulted paper sit on it and then do workouts like the most the most
um probably stark examples recently would be argentina um and uh you know right now ukraine will be pretty significant one as well see what the workout is with that
What would you do with Ukraine as a banker at this point? What's likely to happen to Ukraine?
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Chapter 8: How can investing in gold and silver hedge against economic instability?
And as I alluded to before, these things don't happen quickly. They happen over a much longer period of time than anyone would think. How do you, in simple terms to me, let's look at some global reserve currencies historically. Dutch Gilder, British pound, US dollar, probably the most obvious examples in relatively recent history. And what did they all have in common?
They ruled the seas, military dominance, right? And, you know, you'll see memes online and people are like, you know, pictures of fleets of aircraft carriers in the Gulf and displays of military power. That's what backs my currency. And that is true. But, you know, at some point,
you got to ask yourself a question like where, you know, also how did empires from Rome to the Dutch, to the Brits, like imperial overreach to an extent was what undid them, right? And if we continue to, I mean, what concerns me, what concerns me longer term of the potential to lose the reserve status is if we lose our, military dominance.
That's not happening, obviously, tomorrow or the next day. There's a few things that could, obviously. I mean, you're more versed than I am in this whole notion of modern-day drone warfare, but that certainly levels the playing field very, very quickly. You see what the hooties were able to do. with not so sophisticated and not very expensive drone technology.
But that's pervy for some military expert, not me.
The other thing that concerns me- But the structure remains the same. So the United States can continue being indebted to the degree that it is because it has the world's reserve currency and it possesses that because of its military dominance.
It does, but if- Yes. I think what was a very important moment however, was the seizing of the Russian reserves at the beginning of the Russia-Ukraine conflict. I felt that. And I think... Can you tell us what happened, just for people who... Yeah, so quite simply, the Western powers seized the Russian reserves that were sitting in the New York Fed.
I believe it was 300 billion is the number that they seized. And the Europeans still want to use that for... for rebuild and so forth in Ukraine. Now, not to get into who's right and who's wrong in the Ukraine-Russia conflict. That's not the point of this. The point is it sets a precedent that... That's a scary precedent.
That is your money that sits in US treasuries or gold in our Federal Reserve is not safe if you run afoul of the powers that be. So there's a very obvious and natural reaction function to that, which is powers like India, China, and Russia, stop buying treasuries and start buying gold.
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