'Glenn Beck': Before Gold, Turn to God Thursday, September 02, 2010

'Glenn Beck': Before Gold, Turn to God Thursday, September 02, 2010 This is a rush transcript from "Glenn Beck," September 1, 2010. This copy may not be in its final form and may be updated. GLENN BECK, HOST: Hello, America. We live in a crazy world, don't we? I want to talk to you about — I mean real insanity today. There are some things happening in our country that you really need to understand. And the first thing is how to understand how the economy works. I want to — I want to explain to you, I think there's some economic terror coming our way. And the economic terror alert system, I'll get into that in a minute. But I want to show you some of the stats on why I'm still very concerned about the economy and what is coming. You have to watch this show, the full hour. The evidence is pretty overwhelming: The number of the troubled banks has hit its highest level since 1993, it now stands at 829. The Fed says they are not going to buy our debt, but now, they are — especially if things get much worse and I'm sure it's not good. The Fed has already bought $1.4 trillion of our debt, to stimulate the economy. Now, so you understand, the Fed buying our debt from the Treasury, they can't buy it directly, so they have to sell it to this cup. And they take money out of this one pocket and they say, "Hey, I'm going to give you this money, cup." And then the Treasury, this pocket, comes over and says, "Hey, I've got some debt to sell. Would you like to buy it? I'll take your money and put it." That's how it works. It's moving money from one pocket to another. That's — it doesn't work. Now, we've spent an awful lot of money. And if I may have an ADD moment here, they will argue that if we don't spend enough money, it's going to never get better. And they're going to argue now that they didn't spend enough money the time before. Let's spend a moment on that: Do you remember how people complained that the cost of the Iraq war was going to bankrupt us and we couldn't afford it? It was destroying our economy? The CBO says the Iraq war was $709 billion — the total. The stimulus is $787 billion. And that is a low estimate and doesn't include the first stimulus with Bush or the ones they're talking about now. They didn't work. But we keep trying to do the same thing over and over again. Why? You will understand by the end of this hour. The latest barrage of spending started with George W. Bush and I want to make that clear. And TARP, it was Bush that did it: $700 billion. He abandoned the free market system to save it. But he abandoned it before. First, with the $85 billion to AIG. And then Obama, $17 billion to G.M. Or was that Obama, or was that Bush, too? I don't even know. They're almost interchangeable now. Now maybe this bit of economic news will catch Obama's attention since it involves his new company. After all of the bailout, after all of the money, after everything, G.M. sales have plunged 25 percent. And what's gone up? Homelessness in New York is up almost 50 percent this year. Here's a great figure: One out of every six Americans are now on some form of government assistance. Now, let me put this in perspective. Bring up a map. One out of every six Americans — that's like saying everybody in the state of Virginia is on government assistance, or everybody in the state of Florida is on government assistance, or everyone in the state of Texas is on government assistance. And actually, that's not true, because one out of every six being on government assistance is like all three of these states combined. Do you have a concept now of how much we're in trouble? Plus, you have states that are completely upside down. Well, I want to make it clear: not all of the states are upside down. No, no, no, they're not all running. It's just these states that are upside down. There are three there. Or is it — no, it's three. Three that aren't in trouble. So, how do I know we're in real trouble? Because people with real money — and I don't mean, you know, I don't mean the rich guy down the street, I mean George Soros — they're fleeing to gold. Now, I love this, how Congressman Weiner, you know, went on a crusade to save customers from the pasty fat white guy on TV, because that was his life mission, because I was duping people into buying gold. George Soros is leaving the American market and getting into gold. They bash me for doing radio commercials on my show for gold when gold was $800 an ounce and they were saying, "Glenn Beck is duping everybody. They're going to lose their money." Really? It's now over $1,200 an ounce. That's today. And they're now saying yesterday that it could go up to $1,500 by the end of the year. Now, why would gold be going up? And historically, is that a big number? Well, first of all, all the liberal bloggers who've just put their Cheetos down because they're like, oh, you kidding me? He's talking about gold. I got to write a blog on that. I'd say even on my radio program, I don't buy gold as an investment. I — it's insane. It's insane to buy gold. I buy it as insurance and let me explain why. Let me show you what gold is like: Do you remember — do you remember the Department of Homeland Security? They had their color chart. Where are we? Over here. Their color chart. Show their color chart. Remember this color chart? This was severe, severe risk of terrorist attacks. Well, there is a coded color chart that I've come put with now as well just to explain this, an economic terror alert system. Our economy has warning, warning colors, it's all color coded. You just know how to read it. You know, if you look at the chart — green, blue, yellow, orange — you kind of get it. The red one on this chart over here would be gold. This one. Now, I'm using this as a gold doorway because I want you to understand, this is a doorframe into insanity. You get to this point, things are nuts. It's like California, how nuts does it have to be in California when there's an earthquake, to where you say, where is the only place that could possibly save me, because the entire house is coming down? They tell you, stand in the doorframe. Now, it's better to be outside, it's better to not be in a building, it's better to — oh, I don't know — not live in California, for a lot of reasons. But if worst comes to worst and you have to stand there, you stand in the doorway, it's the safest place. Economically speaking, that has always been gold. It is the — it is the refuge and the safety net from inflation. Well, let me show you how this progression works and you tell me where we are: Stocks is where — is where everybody really, has always been. When things are going well, you're in stocks. There's stocks, there's bonds, there's real estate, there's Treasury and then there's gold and then there's insanity. The farther people move from gold, the better it is, OK? The closer you get, the worst it is. Here's the general thinking: When times are good, you're in stocks. People are putting their money in their 401(k)s and their mutual funds and everything is OK and their 401(k)s are stable. And so, stocks are good. But as things start to get, you know, unstable and a little dicey and you start to feel, you know, maybe an earthquake is coming, like two years ago, stock markets tanked and people lost half of their money, and now, we're on a roller coaster with the stock market — where did people go? Well, some people lost everything. Some people just pulled it out and just hang, you know, hanging on it. But people with money, they went to some place a little safer. They go to bonds. Maybe you're in Connecticut state treasury bonds, which are so stable. Right. Or you invest in a company. Now, what are — what are bonds? Well, bonds are always safer because if a state or a company goes broke, the bonds are the first to get their money back, because these are people who are big investors. If you're going to — you're going to invest in G.M. and they need $100 million. OK, I'll step in with $1 million and buy a $1 million of G.M. bonds. But, the agreement is — is that I get my money first. I'm the first, if it goes bankrupt, the bondholders get their money. That's contract law. It's always been that way. Until Barack Obama: G.M. and the unions, they go down, the unions retiree health care benefit trust got the billions. The bondholders, for the first time in history, get 5 cents on the dollar if they were lucky. Now, you have cities like Miami and states breaking their employment contracts and the bond programs. So, what do you have? You have people saying, well, wait a minute, if our contract doesn't mean anything, what does — what do bonds mean? All right: So, you are out of stocks. Now, you can't trust an American contract anymore. So, what's the next step? After that, I guess it's real estate. I had a guy who owns a lot of real estate told once, he said, man, I used to think that land would always be worth something. I don't know. I don't know anymore. Well, you know how the real estate market is going with you, right? You try to sell your house? Yes. Me, too. Even NPR is reporting that there may not be much the federal government can do to halt the housing market slide? Well, what does it mean? That means what we told you: You can't pour all of this money because you'll never stop the slide. So all of that money is wasted. It's gone. Sales are now the weakest in 15 years. The commercial real estate bubble is bursting. I told you, it would happen a year ago. It is coming now. Companies are increasingly just walking away from their properties, because they don't have the money and it's actually cheaper than paying the mortgage. So, they just walk away. All right: Stocks are unstable; contracts you can't believe anymore; real estate is still tanking. So then — so then, what? So then what? Treasuries. This is — these two — this is not insane. This is. This — treasuries, that's the place of real safety. How are they doing? Well, I mentioned minute ago that the Fed is looking to buy its own treasuries. Take money from one pocket. Print it. Put it in this pocket. Now, why would you do that? Because nobody is buying these treasuries at a fast enough clip because we're spending too much. This is like investing in a company that sells pet rocks today, not in the '70s but today. Nobody is buying pet rocks. So the rock people decide to buy their own pet rocks, so they can invest in pet rocks. It's not going to work. How are you feeling about your investment with the pet rock people? Yes. OK. Then, treasuries, when things get really dicey like they did in the '70s with Jimmy Carter, that's when people say, "You know what? I don't know if the federal government can do it. I'm going here." You are in the doorframe because there's an earthquake. Now, this is the traditional point of insanity. And that's where we're going. And that's — we're here because — well, gold prices are climbing. It's almost — it's over $1,200 an ounce today, because people don't trust any of these things. That's the problem. Now, look, it started with Bush and Obama, just keep — Obama is putting his foot on the pedal and doing even more. At least $4.4 trillion have added to the 10-year spending baseline in the last 31 months — $4.4 trillion. When Bush left office in January 2009, the national debt was $10.6 trillion. Here we are — what, 18, 20 months later — we're $5 trillion in the Bush administration raising it up over eight years, the biggest increase under any president. And now, Obama is on pace to smash that record. Under Obama in the first, what, 20 months, the debt is currently $13.4 trillion. And they keep turning a blind eye to all of our problems like Social Security, as if everything is OK. It's not OK. It wasn't OK when Ronald Reagan talked about it the year I was born, 1964: (BEGIN VIDEO CLIP, 10/27/1964) RONALD REAGAN: We are for a provision that destitution should not follow unemployment by reason of old age, and to that end, we have accepted Social Security as a step toward meeting the problem. But we're against those entrusted with this program when they practice deception regarding its fiscal shortcomings, when they charge that any criticism of the program means that we want to end payments to those people that depend on them for a livelihood. The actuarial head appeared before a congressional committee and admitted that Social Security as of this moment is $298 billion in the hole. But he said there should be no cause for worry because as long as they have the power to tax, they could always take away from the people whatever they needed to bail them out of trouble. And they're doing just that. (END VIDEO CLIP) BECK: OK. FDR, he saw the problems. When he saw the first trap of Social Security before the self-financing tax idea, he said, quote, "It's almost dishonest to build up an accumulated deficit for the Congress of the United States to meet 1980.... We cannot sell the United States short in 1980 any more than 1935." Well, we have sold the United States short — way short. And that's why gold is on the rise. Now, look at these numbers, because this is important for you to understand. In 1980, the price of gold was $873 per ounce. OK? Today, it's $1,246. So, this looks like it's the highest ever, but it's not, because of inflation. Inflation, this price, if it was in today's dollars, would actually be $2,287. So we have a long way to go. So, if things are this bad, what is suppressing this number? Why isn't gold today here? Well, there's two answers: It's not as bad as I tell you it is — or in the 1980s, they came up with another idea. Yes, the Treasury learned their lesson. You see, they were spending too much and realized that people — remember, because gold, all of a sudden, just skyrocketed — when things got ugly, they realized people were running to that doorframe and using gold. So they came up with something called Treasury Inflation-Protected Securities. Gold is the hedge against inflation. Treasury Inflation-Protected Securities, they're called TIPS. Anybody who is buying treasury right now, they are buying TIPS. But the problem with this is, if I'm buying these bonds, these treasuries, and they are going to pay me on the investment, plus, they're going to pay me for any inflation. If their — by the government spending so much and buying their own money and printing money to buy their own debt, it's going to cause inflation. So, it causes inflation, and then what happens? They have to pay these people back who are in treasuries with more money that they'll have to print and borrow which will just accelerate the pace. You see, you can't do that. But the government did this so it would keep you out of control of your own wealth and keep you from panicking. So, let's start here: Block the path. This is unstable. This is unstable. This is unstable. This is unstable. But the hedge now is here — to suppress the price of this so you don't realize. They are protecting themselves. And while we toil in the cycle, has anyone looked at the rest of the world? India's economy, while we are going down, they're growing at 8.8 percent. Russia: Growing at 4.0 percent. Germany has unemployment rate at 7.6. Now, why is India, Russia, and Germany doing better than we are right now? Take a big gulp, America, because you're going to hear something you never thought you'd hear: They are freer than we are. The stocks are shaky at best. Bonds are toast. Property values are toast. People are buying treasuries and some people — like George Soros — are standing in the door frame. But the question is: What is past here? The doorframe of insanity! You don't want to be standing here. Remember, you are in a house that is coming down all around you. This is your protection? But if this doesn't work, what's here? What's on the other side of the doorframe? Nobody knows — because we've never been here. We've never been here. Is it bullets? Is it — is it whiskey? Is it cigarettes? We don't know — because we're here. And some are in denial and they're standing here. Look, these problems are so big. And this isn't enough protection. That's why I have said, before you get to gold, turn to God, because the only one who can solve all of these things and the only one that can really protect us is firm reliance on Divine Providence. It is critical that America wakes up. Millions are still investing everything back here. While some, like Soros, know what's coming and they're standing in this doorframe. And then there are people that are intentionally triggering an economic earthquake. And if you don't believe that — oh, you will. Oh, you will, my friend. — Watch "Glenn Beck" weekdays at 5 p.m. ET on Fox News Channel Content and Programming Copyright 2010 Fox News Network, LLC. ALL RIGHTS RESERVED. Copyright 2010 Roll Call, Inc. 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