2461: The Economic Consequences of Global Demographic Collapse and the Future of Real Estate Investing

This show is produced by the Hartman Media Company. For more information and links to all our great podcasts, visit hartmanmedia.com.

Hey there, Jason. Thanks for reaching out. What can I say? My life has truly been changing here since I joined your network. We just covered so much more, so much more in depth that we did not do in Jacksonville, especially that mortgage side. My wife was really impressed with that. Thanks again, and I look forward to continue nurturing this relationship and overall just awesome experience.

Welcome to the Creating Wealth Show with Jason Hartman. You're about to learn a new slant on investing, some exciting techniques and fresh new approaches to the world's most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self-made multimillionaire who's actually been there and done He's a successful investor, lender, developer, and entrepreneur who's owned properties in 11 states, had hundreds of tenants, and been involved in thousands of real estate transactions. This program will help you follow in Jason's footsteps on the road to your financial independence day. You really can do it. And now, here's your host, Jason Hartman, with the complete solution for real estate investors.

Good day, empowered investors, and greetings from beautiful Boulder, Colorado. I am up here at a mastermind meeting and a speaking engagement.

Last week I was in Arizona doing that, and before that I was in San Diego.

3 speaking engagements in a row, but the good news is I got to sleep at home one night in between all of these.

Can't wait till it's over, actually.

Actually, the speaking part is over. So that's a relief.

It's all done.

Today we've got an exciting show. Well, maybe it's exciting. We're going to talk about something that is not getting nearly enough attention, and we're going to talk about how it affects the broader economy and real estate investors. But just know that this issue, which is demographic decline— we've all talked about on the show many times declining birth rates and what that means. in increasing longevity and what that means. These have wide-ranging implications on the economy, on our investments. But the thing I want you to know is that the birth rate problem, as much of a problem as it is— and it is a problem— will not affect you as an investor until probably the mid to late 2040s. So you have a nice long runway ahead of you. So do not worry yet about the demographic situation. And who knows, who knows what might happen in the future in terms of demographics. Maybe we will start importing higher quality people. You know, in a company you want to hire the best people. Well, in a country, shouldn't you want to take in the best people? Shouldn't you want to get the most educated people, the people with money? This is the way other countries work their immigration policies. You have to prove that you have savings, that you have income, that you have education, that you are a good citizen. And sadly, in the US, for way too long, we have been doing the exact opposite of that. So maybe we'll get a bunch of highly educated South Africans, Norwegians, Swedish, whatever— we'll get the smart people to come over to the country and help us build our population back and really have the best people. And you know, when you think of the immigration debate— this may be a tangent alert, so maybe a tangent alert— but when you think of the immigration debate, isn't it interesting how the left that has really gone off the deep end, how the left thinks that we should just go and steal all of this labor and all of these citizens from other countries? I mean, it would be like this: if you owned a company and you had some recruiter sitting outside the door or calling all of your people all of the time, that's basically what the U.S. does to these other developing countries.

We're stealing all their people. Like, how are they going to build a country if they don't have some people, some human resources?

And apparently these immigrants are supposed to be such a great resource You know, they're all the people that are going to cure cancer and work for SpaceX and build great rockets.

And, you know, it's just not true at all. It's just absurd. But I digress.

So let's get to our show today. But I do want to remind you to use my AI. My AI avatar is better than me, and I hate to admit it. I hate to admit it. Now, if you go to jasonhartman.com/ai, Or you just go to empoweredinvestor.com and you click on the little AI icon. That's also been integrated into Property Tracker. Here's why you should use this. Well, a few reasons.

Number one, it's free.

It's free. Number 2, it is smarter than yours truly. Not saying that yours truly is so smart, but hey, you're listening to me and you're watching me, so you must think I've got some good ideas here and there, right? And it's got basically everything I've said on this show for 21 years. And it remembers everything I've said. I don't remember everything I've said, but it can easily recall everything I've said. And then layer on top of that, it has access to the entire internet after it was trained on literally millions of words from my podcast and other content like our live events that maybe you didn't attend and you did not hear on this show. It has that in its AI brain.

And layer onto that, it has the entire internet to add to that.

Okay, so it has specialized knowledge of my content, incredible memory of my content backed by the entire internet, basically all of human knowledge ever since the beginning of time. Right? It's got all of that going for it.

But here's one thing it has that I do not have. And those other things I do not have either, right?

It is way more patient than I am. And I can tell you are using this to your advantage because the people who go to jasonhartman.com/ai and either type or talk in voice with my AI clone—

You keep coming back. And it's great. I'm glad you're using it.

I'm glad it's here to answer all of your questions. If you've got questions about the future of the real estate market, how to use inflation to your benefit, how to use the Refi Till You Die strategy or the Hartman Risk Evaluator or the Hartman Comparison Index and so, so much more, literally millions of words of my content. It's all there for you.

Just go to empoweredinvestor.com.

Click on the little AI icon down in the lower right corner. If you're using Property Tracker, and I hope you are because that is also free, click on the little AI avatar. It's got a little picture of me and Jason Hartman AI, and use this. Use it all the time. Those of you who start using it keep coming back, and, you know, we get to see and analyze some of the questions you're asking and the repartee you're having with the AI clone, and it's just great to see it. It's great to see that that is such a powerful resource for you.

So take advantage of it.

Take advantage of Property Tracker. Take advantage of our free monthly masterclasses, empoweredinvestor.com/wednesday. That's because those are the second Wednesday of every month. And if you want to upgrade your knowledge and upgrade your experience with us, join our Empowered Investor Pro community as well. So you can talk to any of our investment counselors or find that on any of our websites. It's available to you. But now let's talk about the demographic changes and the potential civilizational collapse and what this means for the economy, what it means for the real estate market. Let's dig in with our guest.

It is my pleasure to welcome Malcolm Collins to the show. He is a former venture capitalist, a current private equity investor, and he is the author of the Pragmatist Guide series that includes 5 books, the guide to life, relationships, governance, and more. And today we are going to talk about a variety of topics, not the least of which is the economic impact of demographic decline. We're going to talk about that as it relates to the U.S., China, and the world in general. As well as a whole host of other things. I met Malcolm in Ecuador just a couple of weeks ago, and it was a real pleasure having some very nerdy conversations with him. So glad to have him on the show. Malcolm, welcome.

How are you?

It is so great to be here today. You know, and this is an issue we mentioned, my VC background and the demographic stuff. So I was actually director of strategy at an early-stage VC firm in South Korea, actually the number one early-stage firm there at the time. And I had this moment there where, you know, in VC, and a lot of people, they ask, why are all the Silicon Valley people so interested in demographic decline, but like the Wall Street people aren't? And the, you know, it's because the VC people need to plot 50, 100 years out, whereas the Wall Street people are typically planning 5, 10 years out, right? But sometimes you can make very good bets when you have this longer 50-year time horizon and you see things before other people do.

Sure.

And when I was working in South Korea, you know, I had to plot the future of the economy. Well, the problem is, if you look at their current fertility rate, which is dropping every year—

You're talking about South Korea now, right?

Yeah, South Korea.

Which has the lowest fertility rate on Earth. It's absolutely extinction collapse forever.

Yeah, let's assume it doesn't keep dropping, it stays where it is, right? So that means for every 100 Koreans, there will be 6.4 great-grandchildren. So, we're looking at a 94% population collapse by the end of the century.

Wow.

That's scary.

And we had people freaking out about 1% of people dying in COVID and stuff like that. And yet nobody cares. And so, I went to the other partners at my firm and I said, what's going on? There isn't going to be an economy in 50 years. What are we talking about? What are we investing in? And what they said basically was, Well, we just sort of all pretend that everything's fine because the A-round investors are pretending everything's fine and the B-round investors are pretending everything is fine. And that's very much the way an economic collapse works before it happens, is that everybody is pretending that everything's fine because everyone else is pretending that everything's fine. But everybody secretly knows things are very, very not fine.

Right.

When I came back to the US, it was like traveling back in time 25 years, because we are today around where South Korea was in the late '90s, and we are looking at a similar trend. In fact, if the fertility rate in the US continues to decline at the rate it has over the past 10 years, for every 100 Americans, there will be only 3.4 great-grandchildren.

Wait, wait, wait, wait. That can't be worse than South Korea, though.

So remember, the statistic for Korea was that if it doesn't decline any further. In America, the statistic I just gave is if the rate of decline continues at the rate it's going at now.

So you're talking about rate of decline rather than current rates projected forward for the US?

Yes.

So for South Korea, you did it differently.

Yeah. So South Korea, what I did is I said, suppose their fertility rate stays constant.

You gave them the benefit of the doubt, in other words.

Yeah. Yeah. In the US, we're fine if fertility rate stays constant. The problem being that not a single country on Earth has figured out how to reverse this trend. Hungary spent 5% of its GDP last year trying to reverse the trend. They only got fertility rates up by 1.6%.

Wow.

And this is— and that is like an irrelevant number. When we were talking about how screwed China is, a lot of people underestimate. So they hear China and they go, oh, this is all about China's one-child policy. That's why they have a low fertility rate. And it's like, no, something new, something catastrophic is happening. In 2020, their fertility rate fell by 20%. In 2021, it fell by 13%. Double-digit rates of decline are insane. You think, oh, this is just zero COVID. 2022, it's going to go back up. 2022, it did go back up 0.18%. Fortunately, the US is in a little more protected state than other countries. But the big problem is, and this is where it all comes back to investing, and it's something that investors are going to be able to understand, which the general public just can't get when I talk to them often. It's that our entire economic system is built on the presumption of constant growth. Real estate goes up because demand for real estate goes up because there's more people and those people have more money. Let's just talk about real estate. Real estate right now is actually going up because demography is declining. And that can often surprise people. They're like, what do you mean by that? What's happening is, is that family units are atomizing. So, you used to have a family where you would have a husband and a wife and 3 kids living in one house. But now, even though the population isn't continuing to go up at the rate it used to go in. People aren't getting married anymore. They're living in different houses. So, this means you need more of these starter homes, which is causing the current pressures on the market. However, these pressures are inherently unsustainable. They are the sign of a coming mega collapse. And when I say a mega collapse, what I mean is for 300 years, the economy on average has always gone up. And it's always gone up because the number of people in the economic system has been rising exponentially, but the productivity per person has been rising linearly. Yes, technology has been increasing exponentially, but if you look at the productivity per worker, and you can find graphs of this, this is pretty much a linear increase. If population begins to decline exponentially within developed countries— now people say, oh, the developing world still has a lot of people, but the developing world isn't relevant in the world economy. You know, the countries that are the ones that are collapsing are the ones where, where that matter economically in the world. So if that starts to decline, then we could see a stock market that every year is declining on average. And when that happens, this is where debt comes into play. And this is when I talk with investors and they get it and other people don't. Debt's a miraculous tool. You know, if I am buying a property or I am making an investment as a private equity guy and I'm making a $10 investment and $8 of that is debt and $2 of that is equity, and that investment goes up by just 20%, I've doubled my equity investment. But if it goes down by just 10%, I've lost half my equity investment. We haven't just taken out debt at the level of our nation-state. We've taken out debt at the level of our cities, at the level of our states, at the level of our businesses, at the level of our land, at the level of our human capital. It is insane how leveraged our economy is, and that has led to a false prosperity that will immediately disappear if anything ever begins to decline in the aggregate.

Couldn't agree more. And that really started In earnest around the late '60s, early '70s. Yeah, you know, we, we had the— I believe the first major credit card was the Diners Club card, and then this whole expansion of credit. Then we went off the gold standard in '71, and the government just could spend with no tether whatsoever. It is a false prosperity. But let's actually just dissect that a bit, and I want to go back to some of your other points earlier too. But it's not entirely false, the prosperity, right? Because like you said, debt is a tremendously powerful tool. It allows you to basically borrow from the future to get progress today, right? And so as long as you have an economic machine that's big enough to pay for the— you know, the idea is if you can borrow from the future but the machine that you're financing is so powerful that it can pay back way more than what you borrowed from the future, it's worth it. And that's why on an individual level for real estate investors Debt is a phenomenal tool, right?

Yes.

But it's not always going to be that way. When we hit 2050, maybe a little before, a little bit after, things are going to shift pretty radically because of the demand equation. You know, we certainly saw that with Japan, right? Everybody in the late '80s was very xenophobic about Japan. They thought Japan was going to take over the world. They had their collapse, and, and they're still getting through it, but You can't have a country if you don't have children. You can't have an economy if you don't have children. People are, are the demand side of the equation, but they're also the supply side of the equation too, right? So they're, they're just vitally important. We could go down a rabbit hole of artificial intelligence and technology, and I might want to do that with you. But first, I want to go back to something you talked about much earlier, and that is the cause. I think we can't just say Well, there's a demographic decline, which there is. The numbers do not lie. But let's examine why that is happening, the sociological forces that are causing that decline. I mean, Hungary, it spends 5% of its GDP, can't get people to have sex. You know, the US can't get people to do it. The only way the US is growing is through immigration in any real way.

Right?

You look at Western Europe, you look at Russia, you look at Japan, you look at China. I mean, these are demographic cliffs. They are catastrophic. What are some of the causes? And there are many, but let's touch on a few.

Yeah.

So, I mean, we can talk about— this is an area I could go deep and crazy on. But if we talk about like—

I know you can.

This sort of progressive monoculture in our society that's sort of— I call it the urban monoculture because it exists Across communities, pretty much anywhere urban center you go in the world, it's spreading from there. It leads to very low fertility rates. But instead of getting political, let's talk about the economics of this, because this is actually, I think, really interesting. A lot of people think that people aren't having kids because they don't have enough money. But the reality is, is that the less money you have, the more kids you have.

And in the past, you had way less money. And you had more kids.

Yes.

So that's not a reason.

So poorer countries have more, more kids, and poorer people within a country have more kids until you get to the very extreme of the economic spectrum. So in the US, you don't get above repopulation rate again. That means that people are replacing themselves until a family is earning on average half a million dollars a year. And if you look at the world, on average, a country falls below repopulation rate. So a lot of people are like, oh, it's like a developed world and a non-developed world thing. But that's really not right. If you look at Central and South America, right? They fell collectively below repopulation rate by the UN's own statistics in 2019. So it's only really poor countries. So to be above repopulation rate today, a country really needs to have, on average, the average citizen needs to earn less than $5,000 USD a year. So what's happening here? Why is it that the very rich and the very poor are the ones who are least affected by this? And the answer is, is that one of the core economic things causing this is actually engagement with a market-based economy. Now, I'm a capitalist as much as anyone could be, but we have to admit that to an extent, this is somewhat caused by capitalism in that capitalism is a great system for dynamically judging the value of a person and paying them just what it needs to pay them to get them to spend their time doing something that the system sees as productive versus something else. The problem is, is that the system isn't good at judging long-term value from stuff like adding humans to the system, like kids to the system. So if you have a smart, you know, well-educated person, right, who can command a high salary, that high salary that they are quote unquote commanding is actually the system— what the system needs to pay to bribe them to not have a life. And that life in the past was marriage, kids, everything like that. And the more the system wants somebody, the more it's peeling them out. And this is also why You know, people are always talking like, okay, well, you know, people with lower IQs are having more kids than people with higher IQs. This is because the people with higher IQs are more in demand by the system. They have more value to the system, so the system will pay them more to not spend their time on their family.

So I think the other thing though is one of the really good measures of IQ is foresight. I think being able to determine what is the likely thing that is going to happen if you take a certain action today. And so you could argue that people with higher IQs just have more foresight and they understand the future impact of today's decisions, right?

Yeah.

They're willing to delay gratification for a bigger long-term future. And I think you could also argue that they're more selfish. Selfish is a complex topic, okay? And by the way, I wanna recommend the book by Ayn Rand, The Virtue of Selfishness, which the title has very little to do with the book. She, in fact, in the intro, she says that she titled it that Just to bother people. I love that. But anyway, you could argue that it's selfish to have children because you're getting all kinds of joy out of that and you're ignoring other things, right? Or you could argue that it's selfish not to have kids because you just wanna like do your own thing, right? So I don't know, you know, those arguments can go both ways.

I see it's interesting. It depends on how you define your life goals. I don't know if you've seen the meme where you have sort of the low end and then the high, the midwits, and then the high end people again. And so I think a lot of these people who are drawn into the university system and stuff like that, they get— the urban monoculture tells people the only thing that matters in life is your own happiness. Whereas a lot of people who haven't been drawn in and sort of brainwashed to an extent by this monoculture, they believe that what matters is their culture, having kids, giving those kids a good life. And yet when people in this urban monoculture think about kids, what they're asking is, How do these kids improve their own life? So I think what you have is people at the two ends of the spectrum. You know, you have your Elons and then you have your people who aren't going to college. And both of them realize a fundamental truth, I think, which is that in reality, a life well-lived is a life where you are passing something down to future generations, where you, you know, you have a satisfying family life, you have kids, you are continuing your cultural traditions. And so much of us have forgotten The value of those things.

Well, the, the lefty media and just the lefty narrative will convince people that that's wrong and that kids are bad for the environment and people are a cost, not a resource. People are a cost, but they tend to also pay for themselves. You know, it's both. And by the way, a great book that I've recommended many times before on the show is called The Bet, and it's about Ehrlich and Simon and this big debate in the '70s over the environment. You know, that there There was the Malthusian ideal that, you know, we're gonna run out of resources. And they literally said it, people have to stop effing, have to stop having kids. You know, we've gotta stop these people from breeding. Like, that was the Malthusian idea, right, of scarcity. And then the other idea was, you know, that people are a resource. They create abundance, they create solutions, they solve problems.

Mm-hmm.

And that's the side I'm on. I like people. I think they're great. I think the next person born could be the person who cures cancer and helps us colonize the universe. Who knows? It's just really unfair. And Mark Stein made an interesting comparison to this idea of the avatar of a feminist left-leaning woman, right, who's in her mid-30s, who doesn't want to have children because she thinks children are bad for the environment, and she thinks that's really like selfish to have kids.

Okay.

Of people to do that. But interestingly, she, when she gets older, will be a 100% burden on the economic system because there will be no one to take care of her, no one to pay into the system. She will simply be a burden and the government will have to take care of her because there's no kids. And it doesn't understand it could be her kids taking care of her. That's the one-dimensional way to think of it, of course. But really, it's kids in general that are the next workers that pay into the pension system. Okay.

Yeah.

And that's why China will collapse very soon, because China is a demographic disaster. Okay. There's simply no children to support the older retiring workers.

So one of the things I find so hypocritical is this hypothetical progressive woman who you mentioned. When I go talk to her about this, well, you're going to be living off the system, right? You know, Isn't that fundamentally selfish? She's like, no, no, no, we can fix this with immigration. And then I point out, I'm like, well, Latin America fell below repopulation rate, you know, 3 years ago, right? And they go, oh no, we can fix this with immigration from Africa. And it's like, so is your actual, like, not racist plan to import people from Africa to pay for a bunch of non-working white people who decided not to put in the effort to have kids themselves?

Sounds like slavery to me.

It's obviously a much more ethical system than slavery, but it is still unethical.

Sure.

And worse, it creates a system where the developed world's economy is completely reliant on African countries staying poor to maintain this high fertility rate because no one— and people should be focused on this— no one has figured out, except for Israel, and we can get on that later, has figured out how to combine Prosperity, gender equality, and education with anything like a stable population. But, and this is something we haven't talked about that I know some of your readers are shouting at the screen, even if all of these things weren't problems, we still have the problem that dating markets are completely broken right now.

Okay, let's talk about that one because I couldn't agree more. It's amazing to me, like I remember being razzed a few months ago about a couple who has been married forever. You know, they're lucky they found their sweetheart very early life. They've been married for a long, long time. And they said, Jason, you know, when are you going to get married? Are you just going to be a bachelor forever? And as if I want that, right? Like, as if I have a choice. Their whole perception of life is literally 4 decades old, and they have no concept of how much it has changed even in the past decade. It has just radically changed. Like, think about it. If someone has that reference point of 4 decades ago. They're literally 2 generations out of step.

You know, I couldn't agree more. And I would—

And not to mention the massive impact of technology.

Yeah.

Oh, so there was a tweet I saw recently that I really agree with, which is being, you know, a younger person in a happy relationship, like happy marriage today, feels like catching the last chopper out of 'Nam.

Um, it is out of Vietnam. Yes.

Yeah, Vietnam. You know, uh, you're like, oh God, like the rest of those people are really screwed. I am lucky to have gotten on this because I don't know, you know, I met my wife.

The problem is though with that metaphor you just mentioned, so being in a good relationship today is like catching the last helicopter out of Vietnam being evacuated, right?

Yeah.

The problem is that helicopter, the metaphorical helicopter, is being shot at constantly because there are so many forces In social media, the media in general. When I say media, I don't just mean the news, right? I'm talking about movies, books, TV, everything. Music especially. The whole drift of society is breed discontent, ruin relationships, cheat, have fun, live for today, have the hookup culture. It's just absolutely disgusting. It's a total mess.

Totally.

People have to realize that what has happened since the sexual revolution in the '60s never happened before in history for thousands or millions of years, right? This is a totally new experiment. It has never happened. There is literally no evidence to support the culture we have today, that there's no evidence to say that this works.

Well, okay, so 2 things. One is you're talking about this being a new culture. You're talking about debt being actually kind of a new thing used in the way we use it today. A lot of people have this perception that like, oh, society will just go on. It's gone on for a long time. You know, not a lot has changed. It's been all incremental changes. It's like, no, there's a bunch of new experiments we're playing out. But you saying we've never tried this before? No, no, no, we've tried this before. The same thing happened near the end of Athens. The same thing happened near the end of Rome. Sexual revolution, rise in gender equality, all of this.

Yeah.

This rigmarole happens every time we're at the top of a cycle. I would like to be able to create an infinite top of a cycle. I actually think it's good to have, you know, gender equality and sexual freedom. And it'd be cool if we could find a way to do that without society collapsing. But finding that means we need to consciously think about what's about to happen and experiment with it. So remember when I said that this was a marketplace failure? Dating is a marketplace failure. It is a real marketplace. So people, you know, they sometimes are like, oh, you mean like metaphorically? No, you have people, men and women, on 2 sides of a marketplace basically trading themselves for someone they think is of equal value. The marketplace—

Ideally greater value, especially for hypergamous women.

But right, right, equal or greater value. The problem comes when people get a misperception of their own value, then you can't create a harmonious trade. So if you have a woman, for example, we, I mean, we talked about this a lot in The Pragmatist's Guide to Relationships. And she has been able to sleep with men who are a much higher quality than the men who will settle for her. She has a self-perception that her value on the market is higher than it actually is. So she will not be happy with a trade that is, in market terms, an equal trade. And so this is what we mean when we say you have a broken marketplace. And it is very interesting. And women also have a problem here. You know, I actually know a woman, when we talk about like mainstream society having a broken marketplace, who converted to Mormonism just to find a husband. And she did.

Yeah.

And she's very happy now.

You know what I tell you? I have considered the same thing. I mean, the Mormon culture is really good, and I'm not saying everything about it is good, but the Mormon groups I've hung out with over the years and known, it just seems like they have a really good sense of community. And by the way, you know, being a moderately religious person, it's interesting. Leo Tolstoy came to the United States and he was an atheist all his life, a hardcore atheist. Okay. And then he became religious later in life. Imagine that. You know, I wonder why that happens. Right. And he came to the US and he saw the Mormon culture and he made a comment, something to the effect of the Mormon religion should be the American religion because never has he seen a group of people so self-reliant, So industrious, so community-oriented, and so supportive of each other. That's pretty interesting insight. It really is.

Yeah.

Well, I mean, I think that Mormonism provides a really interesting note here because a lot of people look at Mormons and they think, oh, this is a high birth rate culture. But again, this is one of those things where it's like, uh-oh, look at recent statistics. It looks like Mormons have fallen below repopulation rate. Um, even this, even them, like always in the last 5 years.

So they even fell for the, the lefty narrative, I guess.

Well, I don't know if it's— yeah, it's more— I think that we can see this in political terms, which hides what's really happening. So historically, if I go back to the '80s— so I'm actually going to get into the poll.

And by the way, I want to make a disclaimer about the Mormon thing, okay? Because I, you know, I know I'm going to get like tons of hate mail on this, okay? I just know it's the comment below and tell me I'm crazy, okay, folks? Whatever you want, I don't care. It just helps the algorithm. I love your trolling comments. Okay. Keep it up. But the point is, a lot of people think the Mormon religion's a cult. And I don't know. I don't know the answer. I really don't. Okay. I'm not judging that. I'm just saying they seem to have a great sense of community. That's all I know. Okay. I have not investigated the religion and the practices in any major way.

Yeah. So, so to, to go with this, why Mormonism is failing, you know, we talk about— you were saying, oh, progressivism has gotten to them as well. But I think that when we look at progressivism, what we see it as in our society now is a continuation of the old sort of democratic policies of the '80s and stuff. Whereas I'd argue it's a totally new and different movement and not a derivation of communism like many people think it is. What it really is is this sort of memetic super virus that kills various organizations, religions, institutions, and then starts to, like, it infects them, and then it wears their skin to protect itself. So, when you get a strep throat virus, it'll kill your red blood cells, and then it, like, coats itself in the red blood cells, so your immune system thinks that nothing is wrong. And what I mean when I say this is I think if you look at the modern feminist movement, or the modern, like, Unitarian Universalist Church, or, like, progressives from pretty much any religion or any church, and you scratch beneath the surface, you're gonna see that they have very similar beliefs about everything. You know, whether it's a progressive Jew or progressive Muslim. But if you look at conservatives from these same religious traditions, they typically are quite differentiated in their beliefs about the world. And so what you are seeing here and what the progressive movement is optimizing for isn't what it historically optimized for. It used to optimize for equality, even if that's misguided. Now it seems to optimize for the removal of any emotional pain. You know, that's why you see things like California removing things like test scores. Like, obviously that'll cause more emotional pain in the long run, but in the short term it removes emotional pain. This argument of we can remove emotional pain from your group if only you submit to these social norms is a really powerful argument, especially to a pro-social community. And a lot of communities have put up a longer fight against this than others. But they will all eventually succumb to it unless they build intentional social technologies to protect themselves. And from the more conservative Mormon communities to the more conservative Catholic communities, you see people beginning to build these new social technologies to fight these new challenges they're facing and stabilizing their birth rate within the more conservative factions of these communities.

Okay. So people are undoubtedly thinking, what is he talking about, a social technology? Are you talking about a, a social media app or a dating app, or what are you talking about when you say that?

Oh, here's a great example of a social technology that's been very effective. So one group that's been very effective at fighting this are the Mennonites, right? Mennonites, uh, are a form of Anabaptists similar to the Amish but not as extreme as the Amish. Um, and one thing that they will do is, uh, they have these little apps on their phones. Now this isn't the social technology. The social technology is the way that they're using it. So it's a way using technology to combat something else, that lock their phones out of most of their capabilities. And they give the password to these apps to their spouses or best friends. So they have to admit to their spouses or best friends a social— like a failing of self-control when they want to use them. But they can still use them for business purposes because their spouse is like, oh, you're using this for business? Okay, here, I'll grant access to this specific app. So that's an example of a social technology that has emerged to fight new social pressures that didn't exist 10 or 20 years ago.

Okay. Yeah. So, so it's basically an agreement, a social agreement.

Yeah, yeah, yeah. A social agreement. I mean, uh, a Mormon— when we're talking about Mormon dating, Mormon dating wards are an example of a social technology where everybody comes together who's of a certain age and who's single, and then, uh, they pretend to be a husband and wife and like host other people in their ward so they get to try that out. I mean, a lot of that is like, you know, you could argue that the debutante ball or the bar mitzvah and the bar mitzvah— Exactly. Social technologies.

Yeah, sure. Okay, got it. Oh, and, you know, marriage itself, right?

Okay.

Yes.

Yeah, absolutely. Okay, good. Let's move on, but let's circle back to the economy and what all this means to the economy, what we can look forward to, you know, in the next 10, 20, 30 years. I think that's really important. It's what our, what our listeners want to know.

Yeah, so I think the first thing you need to know is that the ball on this is going to drop somewhere in East Asia. Could be South Korea, could be China, we don't know. But within the next 20 years, probably within the next 10, we are going to see an economy collapse, and it will be broadly recognized that it collapsed due to fertility rates. When that happens, people will start paying attention to fertility rates and may start pricing it in to the way that they're investing in things. That is one path that things could go on. Now, the lengths to which an economy can stay delusional about something is, I think, can always shock everyone. So it could be much longer before this happens, or it could be that the economy in East Asia collapsed and people don't begin to price this in. Where this begins to become really interesting is those of you who are watching who have kids and are thinking about, how do I store my assets for my kids? Because a lot of traditional ways of storing assets no longer make sense intergenerationally, no longer make sense in a collapsing economy or a collapsing population scenario. So, things like real estate become a lot less valuable intergenerational stores of wealth in an intergenerationally shrinking world. Things like hard assets with stable values, gold, become less stable intergenerational value sets, right? So then what does become valuable? This is a really interesting question. So in a world where— so it used to be the thing that would have the most value is anything that you knew had a static quantity and the quantity was known. This is one of the reasons why Bitcoin had value to a lot of people, because it had a static quantity and the quantity was known. This is why real estate has You have something of a static quantity, and you can sort of chart how much that quantity may increase over time. But static quantities have value because the number of people who want that thing of static quantity is increasing, and the wealth that they have is increasing. If that number shrinks, this old static quantity rule goes out the window. So then what has value in that world? What has value in that world are human beings. That is where it gets really interesting. Human beings and cultural groups that continue to grow and are technophilic and economically productive. And this is why it gets interesting, because a lot of people say, oh, well, then that means we should invest in any growing population. But a lot of growing populations are just not economically productive. This can be— I mean, I don't want to be overly offensive here, but if you're talking about like the Haredi Jew population in Israel, right, like a lot of the unemployment rates are really high and stuff like that. They are not as economically productive as other populations, even though their birth rate is enormously high. In the US, you could say the Amish population, they're not technologically productive, but they are economically productive. So, but if you have populations that are technologically engaged and technologically productive, but also economically productive and have a high fertility rate, that will be the core thing of value in the future. And so what it actually means is your kids themselves have more value than the places you can store wealth for them. So assuring that they have stable intercultural transference, that they find good partners, and that they are well-educated becomes infinitely more valuable than those things would have been in our historic society. And that gets really interesting. And there's a lot of ways you can theorycraft around this. Frankly, we don't know where things are going to go because no one has ever gone through this before. No culture has ever gone through this. No one has ever made it through this before.

Really fascinating. So back to the things that will lose value— assets, stock market, real estate. You know, I see that really starting to hit in like the late 2040s. Am I right about that?

I think you're absolutely right. It'll hit in the late 2040s. Something to remember is that something like this will be very slow, and then all at once. That's the way like runs work. And Detroit is a good example of this. People are like, oh, if there's less people, then real estate will be cheaper. And that'll be great. And real estate is great when it goes down in value 20% or 30%, right? When real estate goes— when everyone knows real estate is always going down in value, then houses sell for a dollar, like what's happening in Detroit. That's not good for anyone. Because real estate, as anyone who's a real estate investor knows, costs a fortune to maintain.

As I always say, Detroit is quite literally the poster child for left-wing government disaster. It's just been so mismanaged in, in so many ways. It's, it's just terrible. I mean, the population of Metro Detroit has, has been cut in half. You know, people don't realize that Detroit used to be this world-class city. I mean, Motown music, the automakers. I mean, it was the place if you know in, in its day, and then it just You know, they let the labor unions get too powerful. They had a bunch of left-wing mayors and different governance, and it's just, just a disaster. Absolute disaster. So anyway, go ahead about declining values and asset values.

Yeah, so what you're saying is it's a 2040 issue, and a lot of people may think, you know, this is too near-term for— like, too long-term for me. But I also think that a lot of people who are—

Well, it's really more of a 2050 issue, in my opinion. 2048, 2050.

2040.

No, I agree. And a lot of people who are your watchers, though, have kids and they're thinking, how do I store wealth for my kids? And this becomes really tricky in the world today. And so, that's where this becomes an interesting question. And again, it's one of these things where it's just useful to be aware that this is happening, that the name of the economic system or the economic system that we have built as our default and all of our decisions are optimized around will not be the economic system of our grandkids. And that means that the way we store value for them is going to be totally different. But what's really cool is that being in the US, we will get to see how other countries react to this and how other countries collapse before it hits us, because we are fortunately a more culturally resistant country to this sort of prosperity-induced collapse than East Asian countries. So I think that through looking at how East Asian countries react to this, As it happens to them, we can get a better understanding of how our government's going to react and how to store value. Now, one of the fears is you look at something like zero COVID in China, all of these tracking apps, everything like that. This might be a government reacting to this, trying to control the populace to prevent revolutions so that even as things collapse, the static power hierarchy can stay stable and they can wipe up any value that's left in the economy. Yeah.

I mean, look, the Chinese Communist Party is definitely in fear. They are very concerned about an uprising. They are very concerned about maintaining their power. And, you know, the, the zero COVID policy was just insane. What they— the way they oppressed people was beyond, beyond the beyond. But what I think really people wanna know is, like, what do they do, you know, specifically to just guard against this future, especially people in the US?

Yeah.

And one thing that I think needs to be understood though is that we're talking about overall population decline. What we didn't really consider, and we just don't have time to, is immigration and the way people will, I think, find the U.S. to be the most desirable island in the storm. And I think they're going to continue to do that because I think it's, you know, whatever is going to happen in the U.S. is going to be worse in the vast majority of other places. In my opinion, am I wrong?

No, you're right. The U.S. is the island in the storm of this.

Yeah.

So Americans or people coming to America, take heart. You're in better shape than everybody else, right?

Yeah.

So the question is always compared to what? So we looked at different countries and answered the compared to what question. The U.S. is far better off than the vast majority of other countries. Okay. In literally every way, even though it is also in decline. Okay. I don't deny that. But certainly the U.S. has. in much better positions in the past. Then we have to look at different asset classes and answer the question, compared to what, right? So we talked about how this is going to put massive downward pressure on the stock market, massive downward pressure on real estate values, you know, but there are so many other things. I mean, bank failures, defaults on Treasury bills, possibly just massive inflation through money printing to paper over the problem. How does that all look?

Well, so what increases? So there's 2 real areas. So you're like, in, in this world, if you're talking about compared to what— AI is really going to change things.

That's, yeah, huge topic. And, and that might be a really initial unemployment, but then ultimately overall long-term increase in prosperity.

And AI could fix everything I've talked about, right? If AI could begin to add workers to the economy through simulating human beings What a weird way to enter a post-human world where humans just stop breeding and AI voluntarily replaces them because they decided to date AIs over people and stuff like that. So I think that what does AI eat? AI eats power. What does AI trade? Well, so it can't trade assets as easily as we can trade assets, right? Like it can't open a bank account, but it can trade crypto. So AI is going to engage with assets very differently than we have historically engaged in assets. Can that protect those assets? I don't know. I think the core areas where you are going to see value maintained, and this is what I see a lot of my very wealthy friends focused on right now, is when I say like build community, I mean like literally like they are buying land, they are having other wealthy people that they know or smart people they know who aren't wealthy move to these lands, start these communities. Um, or the people I know who are just smart and not wealthy, they're finding people who are culturally aligned to them. They're making sure their kids know each other. They are sort of moving back to a communitarian society. Um, and I think—

Permaculture, uh, you know, whatever. Yeah, I, I get it. I see that trend quite a bit.

And those communities, I think, are where you are going to have persistent value in the future in a way that the term economic value may not mean the same thing to people in the future that it means to us today. Because the mere concept of economic value is so focused on this idea of, I have a thing of limited supply, that thing of limited supply will always be wanted more by people because there will always be more people. And so we really have to sort of flip around and say, okay, so what really matters is our communities and our children and the culture we create for our children, which in many ways is a good thing. You know, in Korea, this was constantly obvious to me. I was like, I lived in this country where, you know, I'd think, okay, so what happens? Their population declines 95%. Where do they get immigrants? Well, they can't get them from Japan. They can't get them from China. Both of those countries are also collapsing in population. And I was like, it's wild to think that less than a century ago, Japan came, killed millions of people to try to culturally impose themselves on Korea and China. And in the next 100 years, they could just walk into these 2 countries if they were able to motivate their people to have sex. They were able to motivate their people to kill people, but they weren't able to motivate their people to have children and pass on their culture. And I think that that shows this completely different mindset we need to think on when we think of what does it mean to culturally win in this new collapsing world.

Yeah, very interesting points, Malcolm. There's just so much to unpack here, there's no way we have time for it. Uh, just wrap it up with any closing thoughts, advice, predictions, and give out your website.

Um, well, I'd love people to check out our Pragmatist guidebooks. The one most focused on this is The Pragmatist's Guide to Crafting Religion. We recently started a podcast called Based Camp. It's on YouTube and other podcasting apps, so I'd love people to check out that if they find us musing on this stuff interesting. And, uh, in general, I'm just really excited to get people thinking about this because we are next to a civilizational change.

Yeah.

And I think that it's your type of listeners who think about the future, who act pragmatically, who are best positioned to sort of win after this societal change. Because the cool thing is, is that the group that's definitely going to lose is the powers that be, the quote unquote elite of our society. They are the ones who are being replaced, and hopefully they're replaced by people like us, which is, is very fun. You know, just people who, who thought ahead and, and are excited to see where things are going.

Good stuff, Malcolm. Thank you so much for joining us.

Great to be with Thank you so much for listening. Please be sure to subscribe so that you don't miss any episodes. Be sure to check out the show's specific website and our general website, hartmanmedia.com, for appropriate disclaimers and terms of service. Remember that guest opinions are their own, and if you require specific legal or tax advice or advice in any other specialized area, please consult an appropriate professional. And we also very much appreciate you reviewing the show. Please go to iTunes or Stitcher Radio or whatever platform you're using and write a review for the show. We would very much appreciate that. And be sure to make it official and subscribe so you do not miss any episodes. We look forward to seeing you on the next episode.