For what russia has gone through but also to be strong and persistent to make clear russia had a great future ahead of it. We dont have to rebuild the past to be a great nation. That is the debate99 inside Vladimir Putin sprained and russia today. I have read about him and met him but that story really told me of what about the man i was dealing with. Host i will conclude on this note dealing with Margaret Thatcher to expect the unexpected why do you include that and how do apply to that personally . Guest i learned the floor but as secretary of state to expect the unexpected nobody expected the arab spring and tells it was upon us. We have to learn to be agile and ready for the unexpected end while we try to build the world that we want to building a future for over children and my future grandchild for all these people making hard choices every single day and be ready for that. I am convinced we have to continue to lead the world into a future that we want. We cannot sit on the sidelines. We cannot retreat we will have setbacks and disappointments but over time our story has become the dominant story with the hopes and aspirations of people everywhere. That is what i want americans to understand. I know there is the big debate going on with our role in the world and it is an unfortunate consequence. But we can abdicate our responsibilities. How we define it and execute it is of political debate. The world needs us american matters to the world and for prosperity and our story and democracy. We hope more americans engage with that debate and i look forward in the coming months to have that discussion as people read my book and have questions. Host to follow everything that is said about you . Guest i can. It is too overwhelming. I cannot do it. If it is important it will come to me i assume. Of what is a lot of it is not important or inaccurate but i tried to keep up with it. I would be doing nothing else. Host hard choices madam secretary thank you very much. We are very privileged to have with us this evening in recognizable figure in the media and business worlds steve forbes editor in chief of Forbes Magazine the nations leading business magazine and he has headed of Media Company that includes not only asian and european editions but Web Properties focused on politics, sports and financial markets. Many will also remember his Spirited Campaign for the republican president ial nomination 1996 and 2000 during which he promoted the idea of a flat tax. Along with the new Social Security system, medical savings accounts, term limits and a Strong National defense. Steve comes to us as an author that is not a new role for him he has written or cowritten five previous books the latest is money how the destruction of the dollar threatens the Global Economy and what we can do about it is every bit as synthetic and recent and clear of the written as the revere works. People familiar with his libertarian views would not be surprised to read his criticisms of Central Banks and monetary policies with the fed winding down pcs an opportune moment to rethink our system to ensure a more Stable Currency by returning to the Gold Standard. Heb writes freeing the dollar from gold was supposed to make punitive states strong for instead it made the country weaker. Something has to be done. ladies and gentlemen, here to explain what needs to be done along with his coauthor is steve forbes. [applause] thank you very much and all of you for coming out. As brad indicated the book is about many Monetary Policy and many and Monetary Policy is one of those topics that will intimidate a lot of people for some strange reason and as a result the Federal Reserve has less formal oversight from capitol hill and conquers they and our intelligence agencies. The thesis of this book is the topic of money is very straightforward and simple although shrouded in equations the idea is very basic. We have gotten away from it and policymakers today no less than they did 100 years ago since the early 70s even with booming decades the growth rate going of the old Gold Standard the u. S. Average growth rate is worse than 1971. Up through 1971 to maintain those growth rates on average u. S. Economy today would be 50 percent larger than it is now. 40 years, counting adds up to a lot. Just think 50 percent higher income would it means for the deficit, a Social Security, social divisions today, over time it adds up. Critical reason why it takes two incomes and the family what one income could do previously and taxes are a large part but the base of the dollar is critical as well. Print this happens we dont have a Stable Currency and end up with people not getting ahead the way they should come a median incomes not grow wings the way they should and the way my coauthor will discuss the fraying of social fabric and reduction of trust and more divisions. It is a process not one in a billion can diagnose. That is why we wrote the book. Since Monetary Policy does not get people a flutter like reality shows i will give you the advance reward to give you a travel tip. If you ever find yourself in an airplane in coach the middle seat on the runway watching your life pass away if you want an elbow room start to talk about Monetary Policy. [laughter] as a result of the chaos we have had slowmoving since the 70s the Federal Reserve has more and more power but the more power it gets the worst we are. Take quantitative be seeing even though theyre now tapering to end up contracted the economy rather than stimulating. In terms of money. It is very basic to make transactions to improve our standard of living makes it much easier. In the old days we had barbering which was an efficient so i sold an ad in forbes how would i get paid . Perhaps with a herd of goats i am being facetious but if i want to buy ipads i went to the apple store 3,000 years ago then they said dont want coats. I want sheep so i have to figure out how to swap the goats for sheep and hire the sheep herder because you dont wanted. the wolves to eat the sheep and he wants to be paid in wine. Have red wine if he wants white wine is still imagine if we had that today then deposit the cow into the atm. It is very inefficient. In essence money does not have the Intrinsic Value unless you have all gold coins but it is easier in that sense but it measures value. That is all it does. The way clocks measure time , scales measure would wait, rulers and measure linking and money measures value. Because it represents value to make it easier it is a form of communication to let you know, to all the billions of transactions each and every day. Money is not wealth represents a claim on products and services think of it as a coat check. It has no intrinsic fell you it represents a claim on the coat. The idea monday represents products and services is already produced. The idea if we stimulate the economy by printing up money like a restaurant say if we create more coat checks that will stimulate the production of more coats. No. It does not. It is a claim that represents a claim on a product or service. Money works best with a fixed value like a clock has 60 minutes in an hour imagine what the world would be like the daily life if the Federal Reserve and did the clocks what it did to the dollar an edge including the clock 60 minutes, now 48 minutes then 22, then 80 soon we would have to have hedges and derivatives to figure out how many hours you worked each day. Baking a cake . Bake it 45 minutes is that inflationadjusted . It makes life much more difficult. Imagine what would happen if they changed the number of inches and a foot to build a bridge now with is 10 inches or a house, it makes things chaotic. Money works best when it has a fixed value than the question becomes what is the best way to do with it . He fashion the way it works in this country for the first 180 years is you fix it to gold. Why . More than anything else it keeps the Intrinsic Value. You cannot destroy it, every ounce that has been mind is in the world today. The gold ring they could have certain grains back to the egyptian times. It is hard to make but not too hard. You cannot destroy it if you find of gold mine you dont get it collects even with the gold rush the biggest ever only increase the annual supply by three or 4 percent then taper down to the average 1. 5 so on like wheat you dont get droughts or worry about storage. So whether you freeze it or eats it you cannot destroy it has very unique properties it has withstood the test of time. People think does that mean that after have gold coins and 100 percent backing . It is a fixed measure of value. Looking it will the dollars in notes if it went above 1200 that means the fed is creating too much money so it goes below 1200 . That means you need to create more so lets the marketplace determine the needs. So you dont have to have an ounce of gold. So with the varied little amount of gold they responded to signals of the marketplace writeup through world war i. So cold in that sense is like the rulerk[y like chamomile has 5,283 does not restrict the bios of highway that you build. Just to show how brilliant you are at the time of our existence with a Small Agricultural nation, up through 1900 with a population increase 25 fold fold, during that period of time the amount of gold mines only went up 3. Five told money supply when up 160 folds even though it was fixed. So it make sure it does not restrict supply it just stays fixed. Javanese stagnant economy so it is very basic so when people lose sight of that since 1971 we had that terrible decade in the 70s we got it kind of right in the 70s and 80s but the last decade we went back words. It started under bush and the Treasury Department started to weaken a the dollar to stimulate exports and that is how we got the housing bubble. Any time you undermine the integrity of the dollar coming people go to hard assets. The mid80s the average price of a barrel of an oil was 21 today it is 90 . Maybe 110 and. In the 70s he were not old enough to remember. [laughter] i tried that with politics it did not work why no i peddle books. [laughter] but oil went from 3 a barrel of the almost 40 everybody thought we were running out of whale been going up at 100 then weld breakin came in with paul volcker to killed the inflation it went crashing down at 10 an average 20 of barrels a like putting a virus in the computer so you get less investment is less productive because you buy existing things rather than the future but you dont know if you get back 0. 100 or seven years or the 0. 100 or the 0. 20 no uncertainty which is why we have the stagnant dead in the water historic standards. That is why we wrote the book money to educate. Money represents value. Gold is the best way to fix fact. If we understand that we can move ahead to get back the growth rates we had before 71. The other things we have to do but experience shows us if you dont get the of money right with the fixed value you can get the other things right. It undermines the fabric, the social fabric and ways that go beyond simply gdp numbers and exchange numbers. So i will call up elizabeth but one thing to keep in mind is when money is stable in value, brainpower goes for a productive use. Just one example. Before 1971 when currency did not much fluctuate because we were fixed in gold very little currency trade and now currency trading is a huge activity all around the world. Daily volume over 3 trillion. Tens of thousands of the best brains in the world focus on activity would not exist if we had stable money, brainpower that could be used for medical research, other things, productive things. So this thing has consequences that go beyond merely gdp and in qe and whatever acronym safe or out bet with that let me say thank you and turn it over to my colleague elizabeth. [applause] good evening. Its good to be here and i would like to talk a little bit about that chapter, chapter 5 which is money and borrow alaki how did they see money to base his society and people are found this chapter particularly thought provoking and money. It starts out with the famous crowe from economist John Maynard Keynes and i will read it in its entirety. There is no more sure means of overturning the existing basis of society band to debauch the currency. The process engages all the Hidden Forces of economic law on the side of distraction and it does it in a manner in which not one man and a million is able to diagnose. And we say in the book that unstable money is a little bit like carbon monoxide. Its odorless and colorless and you dont know the damage its doing until its very nearly too late. Thats because people are really not always aware when governments weaken their currency and they only see the effects of that which is one reason why debasing money is so corrosive. People say money is about greed but in fact its about trust. Money permit strangers from all nations and societies from all walks of life to come together and conduct transactions based on a commonly agreedupon measure of value. Money in this way promotes cooperation between people. It serves as an instrument of communication as well. Tells us what its society values not just material but what its priorities are. So when money is corrupted its ability to act as a facilitator of trust and cooperation as corrupted as well. Unstable debased money undermines the vital relationships between buyer and seller, between lender and debtor. The philosopher john locke describes this fissure that is produced at Society Score and he wrote and you have heard this as well, whether the creditor be forced to receive less or that debtor be forced to pay more than his contract, the damage and injury is the same whenever a man is defrauded of his due. And during periods of unstable money you often see a particular scenario unfold. Scapegoating involves scapegoating and correction social unrest and increasingly coercive government and in the worst cases it can unleash the forces of political extremism that can lead to the rise of dictators. And recently an investment strategist named dylan rice wrote a good piece describing this classic scenario that has occurred throughout history and he points out that monetary debasement has coincided not only with the persecution of the jewish in preworld war ii germany but also with the french revolutions reign of terror in the salem witch tires and other salem witch trials another bloody unrest is not just the remarks historical occurrence occurrence. Its taking place in many countries in the world today such as the middle east europe and to a certain extent the u. S. Etm analytics a south African InvestmentInvestment Advisory house as an issued report called riot alerts which predict the worlds most likely troubled spots in the firm has been able to forecast unrest based on nations rates of monetary abuse and syria which has suffered nearly 200 hyperinflation top the list in february of 2013 followed by argentina, south africa, egypt, india and turkey all of which have been inflators. Of course their political causes for them causes for then unrest and it takes different form in Different Countries that unstable money in all cases has been a catalyst. The riots that began in the arab spring for example you may remember started over increasing food prices. The financial crisis was very much a lockean betrayal of trust. Weak money helped create a housing bubble and then the fed pulled the rug out from under borrowers and this led to ultimately the collapse of some financial not the wave of foreclosures which led to the collapse of the Financial Institutions and started a stopgap market meltdown of 2008 and that in turn set off a worldwide destruction of trust that ricocheted from one continent to the next. In europe Bank Failures and bailouts shook the confidence of Global Investors helping bring on the sovereign debt crisis over there. We all remember those days and i will read a cloke from economist from Deutsche Bank who told the New York Times in this day and age spreads around the world not around the block. Want block. Once a bank run is underway doesnt matter if you have good loans are bad loans, people lose confidence in you so thats really obviously shows this is really about trust. This worldwide loss of trust can safely turn to rage, riots and protests and we say in the book it went from Balance Sheets to the streets and in 2012 there was a poll by the Pew Research Center that we cite in the book is that america has been more polarized now than any time during the past 20 years and what they basically said most of the increase polarization has taken place not just in the last few years but during the presidencies of both george bush and barack obama and both administrations were weak dollar administration so was definitely this polarization has coincided with the weakening of money. Basically when money is weekend theres a sense of increasing unfairness that the system is rigged, that they are being defrauded. People on fixed incomes on salaries see their moneylosing value while other people are reaping what looked like artificially and unfair windfall gain. The link between effort and award is severed and that is why unStable Currency you get more corruption and crime. And number of studies have found that inflation actually has a stronger connection, actually a stronger connection to crime than joblessness. Crime rates in fact in the u. S. Dropped immediately after the financial crisi