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+{"dg-publish":true,"permalink":"/bookmarks/knowledge/capitalism-crash-course/","tags":["capitalism","societies","bestpractices","money"]}
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+
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+> [!note]
+>
+> > Credits: This is a transcript and an adaptation of this playlist: https://www.youtube.com/playlist?list=PLfRRWDptN6NuL6V-GqlOa-Rt5neQaEzw4
+
+# The Unspoken Playbook: A Guide to Power, Profit, and Plausible Deniability
+
+### **Chapter 1: How Billionaires Avoid Taxes**
+
+I don't actually understand how billionaires avoid paying taxes.
+
+Loans.
+
+You keep saying that, but how do you pay the loans back? I don't... what do you do when you run out of money?
+
+I get another loan.
+
+I don't get it.
+
+I think that most people understand at this point that I don't really make a big salary. I own parts of companies, and banks are more than happy to use that as collateral to lend me real money.
+
+What do you use for the down payment?
+
+Oh, gross. No, I don't do that. You see, poor people... like, what's your net worth?
+
+Oh, uh, way less than a million.
+
+Oh, okay. So you borrow money that you don't have.
+
+I have the money, it's just locked up in equity. I don't do down payments. And as long as the loan is still earning interest, the bank doesn't really need their money back.
+
+But if you never actually pay them, isn't it just pretend?
+
+Oh, my sweet, sweet child. Fractional Reserve banking would kill you. How do banks make money?
+
+By lending it out.
+
+Why call in a loan just to lend it back out to risky poor people? No offense.
+
+So you can just borrow billions until you're dead?
+
+As long as my net worth keeps going up.
+
+What if it drops and you don't have more collateral to give to the bank?
+
+I would probably create a shell company to bail me out.
+
+That seems complicated.
+
+We can talk about that another time. If I can't get creative, which is extremely rare, hopefully there's a favorable tax code. Otherwise, I might let the bank seize my assets that I used as collateral.
+
+Doesn't that look bad?
+
+Sure, but you don't pay capital gains tax if you never realize the gain. But that's a last resort. Otherwise, you just avoid taxes until you die, and then the estate handles it.
+
+Oh, that's actually the best part. When I die, my assets get reevaluated on a step-up cost basis.
+
+Why would I possibly know what that means?
+
+Right. Yeah, you've probably never known anyone that's died with money. Basically, what I paid for the assets gets reset to what they're worth when I died, so no capital gains tax.
+
+Wow. Does the method in which you die change anything?
+
+Oh, why would it?
+
+I'm just asking for a friend. Like if there was an accident, but there were no witnesses, and someone tried to save you but they failed... like, would said hero still get a reward?
+
+I'm going to leave now.
+
+### **Chapter 2: How Lobbying Works**
+
+I don't understand how lobbying even works.
+
+Of course you don't. It's designed that way.
+
+Do you just give politicians gifts?
+
+Depends what we want.
+
+How do you pay them?
+
+Nope. That's illegal. We have to get creative.
+
+You keep saying that, but no one will just explain how it all works.
+
+Okay. What? Why does everyone care so much about lobbying all of a sudden? Obviously, lobbyists represent different interests, maybe for a corporation or an industry. My job is to find ways to incentivize politicians to help us out.
+
+How do you give them the money though, to vote for the bills that you want?
+
+Oh god, where do I start? Uh, first off, we're not like you. Yeah, some lobbying is about voting, but also you need to think bigger.
+
+Well, like toppling governments?
+
+Not that big, usually. Let's say that I make leaded gasoline and there is a pesky clean energy bill. Every bill goes to a committee. So, I'm gonna try to have the head of that committee make sure that that bill never makes it on the schedule. Do you ever wonder why 90% of bills don't make it out of committee?
+
+Jesus Christ.
+
+Not familiar with him. He must work for a different firm. Or maybe I know that some regulations are coming down the pipe for my industry and I want to get in front of those. So, maybe I will craft some watered-down regulations that I want you to sponsor as a bill.
+
+You write your own legislation?
+
+Of course. I don't want them messing it up. I do all sorts of shady stuff, like getting politicians to cut funding to federal agencies or maybe I want a tariff put on an industry or an entire country.
+
+But isn't it illegal to incentivize people to vote a certain way?
+
+No. It's illegal for me to try to sway citizens' votes for an election, but not for politicians and policies. Politicians are better than you.
+
+So you can just pay them?
+
+No, that's actually still illegal. Uh, instead, we have like four buckets of strategies that we can pull from. The first bucket is helping politicians further their careers.
+
+This is why you're always talking about donating to re-election campaigns.
+
+Or we threaten to fund their opponent. The second bucket is nepotism. Uh, maybe we hire someone's son or the wife of a Supreme Court justice as a well-compensated consultant.
+
+You're lobbying the Supreme Court?
+
+Technically, you can't lobby SCOTUS. Third bucket is, uh, enriching politicians after they leave office. So hiring them on as massively overpaid lobbyists.
+
+Holy... Where they're lobbying their old colleagues.
+
+Yeah. Oh, and then the fourth bucket is finding ways to enrich them while they are still a politician.
+
+And that's why politicians are so wealthy.
+
+That's probably its own video, but we certainly help.
+
+Why is everyone so interested in how lobbying works all of a sudden?
+
+Yeah. I don't know. Maybe it's things like scientists finding out that we have 50% more microplastics in our brains than we did 10 years ago.
+
+This is why we know that we're not like you. Did no one tell your people that you're not supposed to eat plastic?
+
+Well, we were forced to eat it. So maybe we'll help you catch up.
+
+### **Chapter 3: Lobbying Strategy 1: Cultivating Politicians**
+
+Just donating to a re-election campaign is enough to get politicians to do all those favors for you?
+
+No. I can only donate $3,300 to a campaign. Donations are actually one of the weakest forms of lobbying.
+
+So, this is where you'd use the other buckets of strategies.
+
+Well, normally, yes, but for this video, maybe we just stick with how we help politicians further their careers. You want to get in way before reelection.
+
+Like breeding politicians to create a race of biologically superior political babies?
+
+You're a weird dude... you might actually be kind of good at this. But no, I mean handpicking existing human beings to put into office.
+
+Yep, that makes more sense.
+
+Because $3,300, that's a lot more to a new politician.
+
+No. God, you're so focused on the money. I just need you in the office. Let's say that I am a think tank that wants to reroute funding from public schools to private schools and you're willing to play ball.
+
+You're going to do some advertising for me.
+
+Can you just shut up? Just stop talking for a second. I'm going to create a fake grassroots movement. We're gonna make a lot of noise around some like, kids being forced to play D&D in school.
+
+Actually, D&D is really helpful...
+
+Can you just stop being such a wet blanket? God, you're such a dick. I'm having people write op-eds, social media posts. I'm even coordinating with a group of stay-at-home moms to start storming council meetings. And before you know it, there's a community-wide satanic panic. And meanwhile, you're going on podcasts talking about curriculum reform, or you're in the media talking about how we need to get Jesus back into schools.
+
+Why would anyone want me to talk about those things?
+
+Because you run a nonprofit that provides tutors to underserved communities.
+
+What? I don't have a nonprofit.
+
+Yeah, you do. The one that we helped you start a few years ago when we threw that really swanky fundraiser to get you the money that you need to go educate the poors. And by the time you announce you're running for office, we have created a hot-button issue and a candidate that is tailor-made to service it.
+
+But I'm not actually gonna do anything about it, am I?
+
+Of course you are. You're going to push for parents to be able to use school vouchers to send their little shits to private schools.
+
+Wow. And that's just one strategy from this bucket.
+
+Yeah. And there are millions of things that we can do, like using our news networks to give you favorable coverage or getting you to win awards in specific industries. Hell, we'll create awards for you to win.
+
+It's like a real-life Nathan for You episode.
+
+And that is without even mentioning the literally unlimited amounts of money that we can funnel into a Super PAC to run as a separate arm of your campaign, as long as we aren't coordinating.
+
+Wow. What? No quirky remarks? No threats of violence?
+
+These videos make me sad. Jokes are hard.
+
+### **Chapter 4: Insurance vs. Extortion**
+
+Insurance protects me from danger. Yes. It's like a safety net.
+
+The mafia protects me from the mafia. Yes. Which is called extortion.
+
+And the government requiring me to have insurance is not extortion.
+
+No. Governments make laws.
+
+If I tried to influence a police officer with a gift, that's bribery.
+
+Yes. You do not want to bribe public officials. Lobbying Congress is not bribery. That would be a campaign contribution. You're not handing them an envelope of cash. But a public official using their position to directly benefit an organization that they're in charge of is an abuse of power.
+
+Yes, that is a big no-no.
+
+If I upset somebody who uses their power to punish me, that's retaliation.
+
+And you have got a pretty good lawsuit on your hands.
+
+My insurance made me pay out of pocket for a claim that I submitted because you didn't hit your deductible.
+
+That's how insurance works.
+
+And they told me that that claim that they paid nothing for was the reason that my rates went up.
+
+I don't know what you want from me.
+
+When the mafia skims money off of companies, that's illegal. Insurance does not do that.
+
+I pay out of pocket for my monthly medication because it's only $60. If I went through insurance, it's 170.
+
+Processing fees. I don't know. The point is you have options. That's not extortion.
+
+Okay. So, the mafia protecting me from the mafia is extortion.
+
+Yes. They punish you for not using them.
+
+Insurance protects me from other things, which is not extortion.
+
+You're catching on.
+
+They do punish me though when I do use their protection, so I just don't.
+
+But you do have a choice.
+
+In practice, having insurance just protects me from the government.
+
+Who isn't insurance? And the insurance industry, who spent $157 million in lobbying last year, the third largest lobbying group in DC, isn't engaged in bribery. You can't bribe the people that make the laws.
+
+If I were to offer to stop making these videos for a fee, that's extortion.
+
+Also a joke. Hey, wasn't Rico invented to handle situations like this?
+
+Oh, buddy. The government isn't the mafia.
+
+### **Chapter 5: Market Manipulation & Corporate Personhood**
+
+BlackRock, the investment firm, has a podcast giving out financial advice.
+
+Yes. And that's not market manipulation. They are helping people.
+
+And Congress is allowed to trade stocks in the industries that they regulate.
+
+Yes. But that's not insider trading. That's a free market.
+
+Martha Stewart went to prison for acting on non-public information.
+
+Ooh, she insider traded.
+
+But what oversight committees do behind closed doors is not non-public information?
+
+No, because it will eventually become public.
+
+DuPont polluted every square inch of the earth's crust with PFAS.
+
+They didn't know.
+
+They knew. They knew. If I were to lick a tub of ice cream and put it back on the shelf, that's a felony. And I'm probably facing jail time.
+
+It's a felony. But companies just get fined.
+
+You can't put a company in jail.
+
+Companies are legally defined as people.
+
+Yes. To protect them.
+
+Protections that people don't get.
+
+People aren't companies. Silly. Make it make sense.
+
+### **Chapter 6: Private Equity 101: The Red Lobster Scheme**
+
+So you only work for companies that are failing?
+
+No, no, no, no. Uh, we buy companies for me to come in and shut them down.
+
+Because they're not doing well?
+
+No, they're doing fine.
+
+Why do you close them up then?
+
+To sell their assets.
+
+Why?
+
+Cuz that's our company. What is private equity?
+
+So your company is buying other companies that are doing okay, selling off all their assets, and then using that money to buy another company you're going to gut instead of just offering a service?
+
+Whoa, that's not fair. We don't gut all of the companies. And we do provide some services.
+
+Like what?
+
+Oh, you're going to love this. We do property management for some companies. Like Red Lobster.
+
+How did you get into that?
+
+It's actually quite clever. I mean, you're going to love this. First, we bought Red Lobster. Then, uh, we sold off all of their property.
+
+So you're gutting them.
+
+No, this is where it gets good. You're going to love it. Third thing, we sold Red Lobster to some schmuck.
+
+I thought that you were doing property management for him.
+
+Yes, and this is the genius of it. Because we sold all of their property to our parent company, and now they have to pay us rent.
+
+Oh, so you're like, evil evil.
+
+I'm not familiar with that word, evil.
+
+Mhm. That one, unscrupulous, hurts people, takes advantage of others for their own profit.
+
+Ah, you mean innovative. Yeah, we're very innovative.
+
+### **Chapter 7: The Leveraged Buyout Mechanism**
+
+How could you possibly make a profit buying companies just to strip them for parts?
+
+Well, that's the genius of private equity. You're going to love this.
+
+Am I?
+
+First thing is we create a shell company to take out a loan to buy your company.
+
+Why would a bank lend a fake company that much money?
+
+Because your company is profitable and our shell company doesn't have anything. So, we use your future earnings as the collateral to secure the loan.
+
+But, you're going to gut it.
+
+Yeah, but the bank doesn't know that. So once the shell company owns your company, we get to work. Are you loving this?
+
+No.
+
+Kind of a Debbie Downer. But just wait. Second thing, if we want to keep any of our new assets, we spin up new shell companies to buy them for pennies.
+
+How is this legal?
+
+Well, that's another word I'm not super familiar with. Anyways, third thing. Our parent company charges your company massive management and consultant fees while we're selling off the rest of your assets.
+
+This is what I don't get. Why would I sell you my company if I could make more money just stripping it myself?
+
+Because you can't.
+
+So, how do you...
+
+Oh, no. We can't do that either. But this is the part that I know you're going to love. Because after our shell company bought your company, we merged them.
+
+And I don't think like you.
+
+Oh, right. Yeah. Okay. So, now your company owns the loan for your company. So, when your company defaults on your loan during your bankruptcy, we get to walk away with all those assets and consulting fees. Oh, why are you looking at me like that?
+
+Oh. Oh, sorry. Yeah. No. Oh, you're going to love this. I was just trying to figure out how much pressure it takes to bite through someone's jugular.
+
+No, I actually don't love...
+
+### **Chapter 8: The Bank's Complicity**
+
+So Banks loan your company money knowing full well that you're going to default on the loan? Why?
+
+Yeah, I don't know.
+
+Oh, I can actually answer this one. The thing is, is that we still make money even if you don't pay us back.
+
+How the... does that make sense?
+
+Oh, I'm going to love this.
+
+Well, we collect origination fees and restructuring fees and interest.
+
+There's no way that they're paying that much in fees.
+
+Well, they don't have to. We just sell the loan to someone else before they file for bankruptcy.
+
+Why would anyone buy bad loans from you?
+
+Because we package it up with other loans and then we sell it as a financial product.
+
+Oh, so you did know that private equity was going to gut the companies and not pay you back.
+
+I mean, they don't tell us that they're gutting the company. They say things like, "we'll be optimizing operations" or "we're unlocking value through asset sales," and my favorite, "we'll be returning value to the shareholders."
+
+Okay, so you did know.
+
+Yeah, we know. But you don't disclose it when you sell off the packaged debt.
+
+A bit of a gray area. We sell it as high-risk debt.
+
+And that's not fraud?
+
+Fraud requires material misrepresentation of fact. They never told us that they were gutting the companies.
+
+I love you.
+
+I love you too.
+
+Who even buys these financial packages?
+
+That is the beauty of the whole system. We are incentivized to make this happen and then we shift the risk to consumers through high-risk ETFs or mutual funds or pension funds. The people that bear the brunt of this aren't exactly at the table to push back.
+
+Hey, has anyone ever told you you got like a really nice neckline?
+
+Oh, well, thank you. You like that he's trying to bite her.
+
+### **Chapter 9: Advanced Private Equity Tricks**
+
+So, after you gut the company that you bought, you just have them file for bankruptcy?
+
+Oh, no. We have like so many more tricks. Next, I'm probably going to take out a loan.
+
+Why would a bank who just gave you a loan that they know you're going to default on give you another loan for the company that they know you're gutting? That's ridiculous. I don't think they would.
+
+That's why I talked to Gary. "Hey, and as you can see, we had a very profitable quarter."
+
+Yep. How is the company profitable if you're siphoning off assets and money back to your firm?
+
+Because we increased revenue. We sold those assets and we shortened appointment times to see more clients. And we also cut costs by closing locations and cutting labor. We had a really good quarter on paper, which is why he thinks that you're making the company more efficient.
+
+It's a good company. Most of the time, private equity is trying to optimize the business, whatever that actually looks like in real life. But that's why this doesn't look that odd to him, which is why you're giving the company a $200 million loan.
+
+Yeah, sure. Cool. All right. So, yeah, now we just pay out a special dividend to the firm and we just made a sweet 200 million.
+
+Wait, if you can just transfer money back to the firm, then why do all the fancy accounting with the management and the consultant fee?
+
+Special dividends can only be paid from profits, and management fees are usually negotiated ahead of time to be paid out regularly.
+
+So, they actually count as bills. But bills make the company look less profitable.
+
+Good god, you common people are thick. Yes, but those bills are dependable income for the firm, like rent. And here's the best part. If the company doesn't have enough money to pay their bills, the firm as the owner has the authority to decide which bills do and don't get paid.
+
+So, you can keep paying yourself while you lay off employees and tell your vendors that you can't afford to pay them.
+
+Okay, you get it. It's like one last big heist before you bankrupt the company.
+
+Oh, no. I could keep telling you about the gross things that we do for weeks. I just wish that you appreciated it a little bit. Hey, you get it, right? What?
+
+Yeah. Do you think that that guy would give me a loan to buy a company?
+
+Honestly, I think he'd need a rock if you asked him to. But no, you're a consumer. Loans work different for consumers.
+
+### **Chapter 10: Lobbying Strategy 4: Enriching Politicians in Office**
+
+Can you finally tell me how you pay politicians while they're still in office?
+
+This is the fourth and final bucket of strategies for lobbying, which is enriching politicians while they're in office.
+
+Enriched. Okay. Uh, do you mean like when we bring a therapy dog to the nursing home for grandma?
+
+No. No. No one's being sent off into the night. We're enriching their wallets by creatively funneling wealth to them.
+
+I want to know how.
+
+The first thing is you want to have relationships with these people. So, take them to really fancy dinners. Get them into a box seat for a Blackhawks game or into a really swanky gala.
+
+You know, I'm starting to think that you might just be making all this up because those are gifts and politicians have to report their gifts.
+
+No. If we do some training, then we can call them educational. Hell, if you were the mayor for New York and I needed you to expedite a consulate for my country, how does a really fancy fact-finding trip to Turkey sound?
+
+You're not actually working. It's a vacation.
+
+Okay. So, basically it's food and events and experiences.
+
+Trainings. You're providing activities to senior citizens which will make their golden years better.
+
+Oh, I've made these people millions. I don't know. I just don't know that I believe you if you're not going to tell me how.
+
+Fine. I don't know why you care so much, but okay. Here we go. Let's say that you regulate financial institutions and you need a loan. I can make sure that you get a very good loan.
+
+This is what I'm talking about. What else?
+
+Your kid needs to go to college. Maybe I have a scholarship they could win or I can pull some strings. Make sure they get into the school you want them to go to.
+
+Okay. What else?
+
+Federal lawmakers can't accept fees for giving speeches or writing articles while they're in office.
+
+Interesting.
+
+But their spouses can.
+
+Holy...
+
+Maybe you own a business. I'm going to find ways to route more business to you.
+
+And what else?
+
+How would you like to write a book?
+
+Not at all. That sounds like a lot of work.
+
+That's why we have ghostwriters. There is a long history of politicians getting massive advances from publishers that are connected to wealthy people or businesses that are heavily involved in lobbying.
+
+Uh, I thought politicians couldn't get paid to write articles.
+
+Uh, Congress specifically included books as an exception when they wrote that law.
+
+Wow. I do feel like there's still a big one though that you haven't told me.
+
+Oh, um, it's insider trading. Yeah, we have industry knowledge. We know what's coming. We have economic roundtables with policy makers who then happen to make some very lucrative, very well-timed trades.
+
+That's the one. That's the big one.
+
+Are you impressed with how good I am at this?
+
+You make these people very happy.
+
+I build relationships.
+
+You're taking care of their retirement accounts.
+
+I exchange information.
+
+And you're giving grandpa a place to tell his stories.
+
+Uh, I mean, if anything, I should be thanking you for enriching our senior citizens. Oh.
+
+### **Chapter 11: The Consequences: Enshittification & Bubblegum Dystopia**
+
+Let's talk about all the gross stuff that private equity does. I got a lot of angry comments from people saying that private equity actually adds a lot of value. And the thing is, on one hand, I would agree with you. On paper, private equity does add a lot of value to some very wealthy people. And on paper, it does make some companies more profitable and efficient. Most of the time, private equity is not buying a company with the intention of gutting it. Usually, they're buying a company, planning on making some quick changes, and then offloading it for a profit. They're flipping businesses.
+
+But does value on a balance sheet actually make the world a better place? Think of all the houses you've seen that have been flipped where the flipper covered up really nice hardwood flooring with cheap linoleum or they got rid of really nice cupboards or a banister. They got rid of the things that gave the house character and charm and value because it was faster to just replace it. Private equity also just wants to get in and out and make a profit. Let's use cheaper materials. Let's reduce the workforce. Let's shorten appointment times so we can cycle through more patients. Let's raise the prices.
+
+Even when private equity firms aren't gaming the system and sticking someone else with the bill, they're enshittifying the world around us. They're making companies worse. That ruins our experience as consumers and workers. And they're even trying to get into national parks. Now, but let's get back to talking about when they do intentionally buy a company to gut it. How do they actually do it? And why do people go along with it?
+
+The first thing that happens is that the private equity firm creates a shell company that they seed with money. That shell company goes and works with a lender and they say, "Hey, I would like to get a loan to buy Toys R Us or Jo-Ann Fabrics or your local urgent care." The Shell company doesn't have any additional assets besides that money that they're using as a down payment. So, the lender uses the current value and the future earnings of the company that's being acquired as collateral for the loan. The Shell company tells the lender that they're doing something like "returning value to the shareholders." So, the lender pretty much knows what's going on, but not so explicitly that they have to disclose it themselves.
+
+So, why would the lender go along with this? Well, they know that it takes a while to strip a company and they're going to collect millions, if not more, on fees and interest before they securitize the loan and they package it up with other debt to sell it off as a financial product.
+
+But why would the company that's being purchased agree to getting gutted? Well, remember, most of the time, private equity isn't coming in to gut a company. They're coming in to turn it around. So, the company that's being acquired probably doesn't know that they're going to be gutted, but also a lot of times they're in a tricky spot. Maybe they want to retire. They want to sell for some reason and no one is lining up to buy the company. Maybe private equity comes in with a really nice offer. Or maybe it's a public company and they come in and do a leverage buyout. However, it happens once the Shell company owns the acquired company, they merge them. And the reason they do that is because now the firm is the owner of the new acquired company, but they don't own the loan because the loan was taken out by the shell company, which is now merged together. So, the company owns its own loan.
+
+And this is where the firm starts to create other shell companies to buy assets for really cheap from the acquired company. Maybe they turn right back around and they rent those assets right back to the company itself. But the firm is going to come in and they are going to start cutting costs. They are going to start selling assets to the highest bidder all while they are collecting contractually obligated management fees. And that's gross enough by itself, but they can also get really creative and do other things like this. If they have a really good quarter on paper because of the short-term money coming in from selling off the assets or the unsustainable cost-cutting measures that they are taking, they can go public again with this inflated evaluation. And the thing is, is that the financial community, it's not huge, and without explicitly telling other people, other people can get a pretty good idea of what's going on and they can make a lot of money by shorting that stock when it goes public. Or they could take that quarterly report, they can go to a new lender. That lender sees a company that is under new management that is suddenly doing better. And remember, most of the time, private equity is trying to flip the company. So they'll say, "Hey, this company looks like it's doing good. Yeah, we'll give you a loan." But then what the firm can do is they can turn around and they can grant themselves a special dividend from the company for the entire amount of the loan. It's like one big lump sum payout.
+
+But dividends have more restrictions, like they have to come from profits. And this is the beauty of the management fee because these are usually negotiated ahead of time and they are paid out regularly. It is dependable income like rent, but also it's a bill. So when the company gets to a point where it can't afford to pay its bills, the firm as the owner of the company gets to prioritize which bills are going to be paid. So the firm can have the company pay the firm its management fees while it's laying off employees and unable to pay its vendors or other companies. This whole thing works because they're all incentivized to make it work. None of them think they're going to get stuck with the bill because they usually don't, and none of them get in trouble for it. By the time they securitize the bad debt and they package it up and dilute it with other debt, it's offloaded to consumers through high-risk ETFs or mutual funds or pension plans. And we don't exactly have a good way to fight back. So, sure, yeah, private equity might be creating value when they're not overtly screwing people over, but I think the question begs, what problems are we creating when we only see value as profit?
+
+### **Chapter 12: The Elon Maneuver**
+
+Why did you sell Twitter back to yourself?
+
+X. I sold X to X AI, which is a shell company.
+
+No, no, no. Uh, XAI is a very real company that I own 54% of. It's actually the technology behind Grok.
+
+So, Twitter's chatbot owns Twitter now.
+
+X. XAI owns X because Tesla's stocks are plummeting.
+
+Yeah, but let's take a step back for a second. Based off of publicly available information through a series of firms and shell companies and selling some of my own assets, I probably had like 5 to 10 billion dollars left that I needed to get to buy.
+
+So you leveraged like 10 to 20 billion in Tesla shares to get the loan. But now that the share prices are tanking, that means...
+
+Well, everyone's shares are tanking right now.
+
+Okay. Well, the bottom line is that your collateral isn't worth as much. So now the bank's getting antsy.
+
+So I sold Twitter... X... sold X to pay back the loan.
+
+Uh, not exactly.
+
+Never a simple answer with you people. Why not?
+
+Well, for one, I lost $1 billion on the deal. But also, I was paid with shares of XAI, not cash.
+
+How could you possibly lose $1 billion when you sold something to yourself?
+
+Oh, it was on purpose. Bingo. Remember capital gains? Well, I just lost 11 billion on paper.
+
+So, does the government give you like, taxes back?
+
+What, are you rich? Oh, that's right. Hey, you're one of those guys. You used that very recently on Twitter.
+
+X. I said it. It's X.
+
+Since I lost 11 billion on paper, I can sell... Oh, plus I can sell assets until I hit 11 billion in capital gains without paying any sort of taxes.
+
+So, you're just going to sell off like a ton of Tesla shares and then pay back the loan?
+
+No, I will probably sell off other assets and then pay back a little bit of the loan to take the pressure off. And then honestly, I'll probably buy more shares of Tesla.
+
+And why are you going to do that?
+
+Buy the dip. Uh, reconsolidate my power, the price is going to go back up.
+
+So even when we fight back and it feels like we're making a difference, you use that as an opportunity to attach one of your toxic assets, Twitter, to a more impressive-sounding AI company that you're getting a bigger stake in, while also walking away with more control of Tesla.
+
+We can only speculate, but you have hurt my reputation. You've made it harder for me to raise funds. You made me cry on Fox News. There's a reason that I am not sleeping at night. So, don't lose faith. You hurt me, but don't expect me not to try to soften the blow.
+
+God, I really want to hurt you, but you make me so sad. Why is everybody so hateful and mean to...
+
+### **Chapter 13: The Modern Scheme: Crypto and Plausible Deniability**
+
+I don't understand how you just made like $350 million out of thin air.
+
+Crypto.
+
+You just made a new cryptocurrency.
+
+No, I didn't do that. I am not involved with that. That's all CryptoJack.
+
+Sure. Okay. CryptoJack, why did you make a new crypto?
+
+To make a shitload of money.
+
+Is 350 million really that much to a billionaire?
+
+No, no, no. That's what we've made so far. We're sitting on another 800 million Trump coins that are currently valued at around 5.6 billion.
+
+Not me, though. I'm not involved.
+
+Uh, can you make me a crypto?
+
+No.
+
+Why not?
+
+Because you're poor and no one knows who you are.
+
+But you can just make a whole new currency. Huh?
+
+Oh, yeah. It's actually surprisingly easy to create a memecoin. But if you want to get people to pay for it, you have to have rizz and brand recognition.
+
+Or you could just be president, right?
+
+Bingo. Because who doesn't want to support the president?
+
+And by support, you mean pay-to-play.
+
+Mhm. And that's not illegal.
+
+Oh, no. That's like super illegal.
+
+But through a series of incestuous companies that are ultimately owned by the Trump Trust, Trump himself is far enough removed to have plausible deniability.
+
+I'm not involved.
+
+So if I wanted a favor from the president, what? I just buy some of his coins?
+
+Mhm. Yeah. It's just like a juiced and lubed up version of the real estate scheme.
+
+What's the real estate scheme?
+
+Yeah. So in the past, if you wanted like a $25 million favor from someone like Trump, you can't just hand him a bag of cash. So, we would have you do something like buy some of our real estate for $25 million more than it's actually worth. But now, I can just give you the bag of cash if I buy your crypto.
+
+Not me, the companies. And also, crypto is completely anonymous.
+
+I thought all the transactions were public.
+
+Yeah, but we have no idea who owns the wallet that's sending us $50 million.
+
+Wait, but then how do you know who's bribing you?
+
+No, we do know. It's just that you can't prove that we know.
+
+Oh, right. Plausible deniability.
+
+That was the lube. Now, here's the juice. If you give us $50 million for $25 million worth of crypto, not only are you giving us $25 million, but you're increasing the value of Trumpcoin. So, on top of the 25 that I'm already giving you, you're getting millions more because of the increased value of your stockpile.
+
+Bingo. And we're only 3 months in. In four years, we could make trillions.
+
+Not me, though. No, I don't make a penny off of this. I'm not involved.
+
+But I couldn't do this.
+
+No, because you're poor.
+
+### **Chapter 14: Lobbying Strategy 3: The Revolving Door**
+
+Why are you still paying politicians after they leave office?
+
+To get them to do favors for us.
+
+Don't you need the favors when they're in office?
+
+Yeah, but it's hard to pay them when they're in office.
+
+So, how'd you get them to do the favors before they left?
+
+We paid them.
+
+You just said that was hard.
+
+Yeah, but just because something's hard doesn't mean you give up. I mean, honestly, I can see why you haven't made it that far.
+
+Oh my god. Can you finally just tell me how politicians get so wealthy when they're in office?
+
+All right, let's do it next time. Because this is actually the third bucket of strategies for lobbying, which is enriching politicians after they leave office.
+
+Can you at least tell me why they're willing to wait to get paid? And what's in it for you afterwards?
+
+Okay, sure. You want to know why they're willing to wait? Are you familiar with the concept of investing?
+
+Sure. Yeah. I mean, I grew up in a trailer park, but I understand compounding interest. I have stocks. I have mutual funds.
+
+Hey, good for you. I mean, 20 years ago, the poor didn't really understand those things, but you are still way out of your depth.
+
+You're saying that their time in office is an investment and it's worth doing the work now to get paid massive amounts of money later to do speaking gigs or have a cushy job sitting on the board of directors.
+
+Sure. Yeah. Or like when we pay old politicians to do media spots. Or like if we were to slap your name on as a non-managing partner at a private equity firm where you don't really do anything but you still get part of the profits.
+
+Yeah. Do you know how I know that you grew up in a trailer park?
+
+Cuz I told you.
+
+You think like Lauren Boebert. You're happy the boys picked you. You're getting some cash, but you have no plan.
+
+I have plans.
+
+You have dreams, not plans. The big players understand that the real compounding interest comes from how you invest in your resources, in your knowledge, in your resume, in your relationships. That is where real power comes from.
+
+Well, now I am kind of embarrassed to admit that I'm not following.
+
+The holy grail for politicians is understanding how you can combine all of those things together to create an institution with your name on it. That's power.
+
+Sounds more like vanity.
+
+It's a legacy.
+
+Tomato. Tomato.
+
+Imagine a library with your name on it.
+
+Why?
+
+After you die, your name lives on and so do your ideas because now you have an institution that is dedicated to pursuing the ideas that you thought were important when you created it.
+
+I don't think we have the same priorities.
+
+Oh, no. I'm not a politician. I just do it for the money.
+
+So why is this even lucrative for you then? They're not even in office to help you out anymore.
+
+They might be out of office, but they still have relationships with people that are in. And having their name attached to our organization gives us legitimacy. It signals that we have access to the government. And most importantly, it signals to those that are still in office. "We're going to take care of you if you take care of us." Because lobbying is just a series of winks and nods. At best, a handshake. And none of that works if you don't have your reputation. And that is my legacy. Corruption.
+
+### **Chapter 15: The Great Disconnect & Bubblegum Dystopia**
+
+Why is it that we are all so stressed out about the cost of living but also we all have 70-inch TVs and iPhones and drones and Xboxes and books and... all the things that we want? Are we financially irresponsible?
+
+No, there's something that's going on that I just put together last night. I don't really know what to do with this information but it seems important so I'm going to share it with you. My father-in-law was telling me in the 70s they bought their house for $4,000. So I started doing some math. The average cost of a TV in the 70s was $500, that gets you a 21-inch TV, yippee. The average down payment for a house was $532. Do some quick math, a little over 10, 11 TVs buys you a down payment for a house. If you can't afford to live somewhere in the 70s and you buy a TV, you're being fiscally irresponsible because that's 10% of a down payment.
+
+The average cost of a TV today, a 55-inch 4K TV, is $500. It hasn't changed. The average down payment for a house... oh... $102,000. Do some quick math... 205, 206... 206 TVs is a down payment for a house. That's 10% versus 0.5%. This is why older generations look at the things that we buy and they say we're being fiscally irresponsible because they're operating from a worldview that they developed when they were coming up. This is why you get old financial advisers like Dave Ramsey that's like, "don't buy the cup of coffee," when the world has objectively changed. It doesn't matter anymore, Dave.
+
+As the price of necessities goes up, the demand doesn't really change that much because we need those things. So as they have raised the prices for houses and food and health care, we have continued to pay those higher prices, and those have gone up faster than our wages, which we've talked about. But that means that we have a smaller pool of disposable income. So now companies that are producing things that we don't need, like TVs or furniture or books or even art or coffee, are having to find ways to drive their prices down, which means driving their cost down. And this is called commodification. How do we pump out as much as we can for as cheap as possible? This is why things feel shitty while we also have a ton of things. This is why everyone buys their art from Target and TJ Maxx and it just feels like there's no soul in it. This is why you can spend $1,000 on a dishwasher and two years later the racks are rusted and falling apart, which I wouldn't know anything about, LG.
+
+And I'm going to steal a term from another creator because I don't remember who said it, but it's "bubblegum dystopia." And they're talking about a type of movie where people live in the future but there's squalor and there's food scarcity and economic uncertainty, but also they have holograms and sex robots and all the media that you can consume to distract you from the world. And I told you I don't know what to do with this information, I just figured it out on my own, but it really feels like that's the direction that we're going in. I don't know.