July 27 Episode
01:01:58 Share

Welcome to Money Talks. I'm calling this the Money Talks special. My name is Mike Campbell. I'm really glad you're with us. You know, over the course of a year, we run, well, terrific interviews. It's no thanks to me. It's thanks to the guests we get. But we get requests to hear them again, or we get requests, can you get that person on again? And I mean, it's substantial, and I'm really pleased with that. Well, today we're going to answer some of those prayers. I'm going to feature the top interviews of the last six months. And I'm going to talk about some of the things that I've done.

And I think you're going to really enjoy it. Some of them actually a little longer than that. We're not going to play the full interview, just the essence of it, the hints. But I think it's going to satisfy a lot of people. We're also doing the quote of the week, the most requested quotes of the week, most requested shocking stat, and the top two goofies, at least so far in 2024. But first, I'm going to start today by talking about decision making. Have you ever made a bad decision?

Bad decisions, you know, mistakes? Well, I certainly has. As the old saying goes, the markets are a harsh mistress though. I mean, that's just another way of saying, you know, you pay a price for bad decision-making when you invest. When your decision-making is faulty or you didn't take into account some variables or you let your emotions dominate and end up taking too much risk, well, you pay a specific financial price when you're wrong. And do that often enough, well, you got two choices. You'll actually learn or you'll stop investing.

I have to admit, you know, over the years, I have been amazed how often at times I can repeat the same mistake. Dan Millman, he was the author of The Peaceful Warrior, says it's not making mistakes that's the problem. It's how often you repeat them.

Well, think about this. That's not the case in politics, where decision makers pay no direct price for implementing policies with even the most dire consequences. I mean, this week we heard the Phoenix Pay System debacle has now cost taxpayers $3.7 billion. And not only did those in charge not pay a price for what former Auditor General Michael Ferguson called unfathomable incompetence. No, you know, some of the managers actually got a bonus.

That's not what it's like in investing. Sadly, there are literally thousands of other examples in the political realm of what they call unintended consequences or billions of dollars lost. But rarely does anyone pay a direct price, which is arguably the primary reason mistakes are repeated so often.

So let me start with some high-priced help, talking about one characteristic that some of the most successful investors in history say is the foundation of sound decisions. The good news is it's straightforward. It's easy to understand.

Warren Buffett put it succinctly when asked the foundation of successful investing, he replied, humility and restraint. Do not let our egos or our desires control our actions to recognize what we do not know or that we do not know everything that we are not infallible. I think that's great advice. So as Stanley Druckenmiller said in quotes, every great money manager I've ever met, all they want to talk about is their mistakes. Well, there's great humility there.

Maybe that's because as well-known author and economist Peter Bernstein concluded after years of study, in quotes, humility is an enormously important quality. You can't win without it. Survival in the end is where the winners are by definition, and survival begins with humility. I love when Mark Twain said, it ain't what you know that gets you in trouble. It's what you know for sure that isn't so.

Now, here's a little something from Oak Tree Capital's famed investor, Howard Marks. He gives us a practical approach that would benefit, I think, all of us, as well as political decision makers. He says that no statement that starts with the words, I don't know, but, or I could be wrong, but ever got anybody in trouble. I mean, that's great advice.

But I want you to notice one thing. In a world awash with nasty, unintended consequences, with so many examples that are the result of, well, really head-scratching political decision, the lack of humility by our leaders and their partisan supporters is actually breathtaking.

And I think we're seeing far more of it. There's sort of the our opinion and everyone else is an idiot approach. Or as Chrystia Freeland put it recently, there are those who are aligned with her vision or those that are cold, cruel, and small. Hillary Clinton called them deplorable. But we see other things. Regularly, opponents are dismissed as stupid or ignorant or a-holes. I mean, it's common among progressives to describe those that disagree as unintelligent and capable of informed judgments.

I think actually it's become a hallmark of progressive elites that arrogance has led to horrendous decision making. And I'm not talking about a different ideological approach. I'm talking about the certainty with which so many make decisions without a hint of critical evaluations, let alone any thought that maybe they could be wrong.

What jumps out at me is the unwillingness to even entertain that the decisions may be based on faulty logic or faulty data or not enough data, which is vividly exemplified by the no questions attitude that seems to have come so prevalent. Come on, questions are how we test our ideas. You can get exposed faulty logic and reasoning. My point is for all of us, when we approach the investment markets or anything else, we do not have to repeat that mistake. Professionals have humility.

They replace arrogance that says, I'm always right. And instead, incorporate humility in ways that says, you know what? Maybe I'm wrong. And that can go a long way to reducing risk in every area. As I say, we've got so much planned for you. The top requested quotes of the week coming up. I've got the top requested editorials or commentary by other people, the interviews that we're doing. And of course, Goofy Awards, all of that coming your way. I'm really glad you're with us.

As I said at the outset, very pleased to welcome back to the show, Doonberg. Why? Because I love quality research. This is exactly what they do in a variety of subjects, but focuses on energy, for example. So again, much appreciated, Doonberg. Thanks for being with us. Mike, I mean, who could turn down an invitation to a podcast that sings such high praises of its guests? I mean, really great to be back with you. And I always enjoy coming and talking with you guys. And so looking forward to another great one today.

I want to just quickly, I'll leave the China thing in a second, but I want to get to the business side because they have a very specific sort of formula of influencing business. I want you to sort of reiterate that again so we can be more aware of it. So we told the story in Chipshot and we started the piece by saying, stop us if you've heard this before. So typically what happens is the West has a big technological advantage over an area that China wants to get into. And suddenly...

at global conferences. Companies from China that you've never heard of start attending these conferences and the attendees are very inquisitive and they take pictures of posters and they ask all kinds of questions of people. And then what happens next is they entice people

Typically, the sort of bottom quartile of the market who is looking to grow and maybe struggling to come into China. And in so doing, they mandate that they form joint ventures with stay-in-home enterprises. And as a part of that joint venture formation process, key technology has sort of escaped from the West and finds its way into China. And then a fear of missing out happens. And all of the other major players in the industry see this mirage of growth in China.

And they have quarterly pressures and mark to market accounting and all the other things that are wrong with the sort of modern free market capitalistic system, which has, of course, many, many positive attributes. But one of the flaws is this short term mindset. And the market can break down on things, for example, that are in the national interest, especially for multinational corporations whose national interest is really limited.

definitive in this regard. And then you see all these other joint ventures showing up. And then suddenly, out of nowhere, a fully state-owned enterprise appears on the scene with all of the internal trade secrets of all of the Western companies, the best of the best called into one spectacular product.

And this product is amazing in its positive attributes and even more stunning in how cheaply they can produce it and basically in infinite supply. And so then this new company rolls up the domestic market

you know, works out all the kinks and then they start exporting overseas. And I lived this directly in the, in the solar industry, polysilicon in particular and ignits and, and, and wafer formation and cell mounting. They decided they wanted to own the solar industry and they just did like they stole all the IP and,

They cut every environmental corner they could. And they put the Western companies out of business. And it works. And this whole concept that there was some S-curve of innovation that drove the price of solar down is just nonsense. Nobody who actually worked in the industry would say that. China flooded the market with artificially cheap supply in order to drive everybody out of business, and they succeeded.

And isn't that what we're thinking about with EVs at this point? Yeah, I mean, no wonder there's a big concern. And hey, look, like BYD just put out a $9,800 car, US, a little more expensive if you're in Canada. Yeah. So they put out a $10,000 EV that goes 200 miles. Now,

The US and Germany can throw up trade barriers and Japan can throw up trade barriers. But GM and Toyota and Audi or Volkswagen, they're all capitalized to compete globally. And I can tell you the 7 billion people not in the G7 will happily take this dirt cheap, amazing product that is more reliable from BYD than to pay four times as much for a car from Tesla. And I've seen this pattern so many times, which is why we wrote about it.

Because nobody in the industry wants to say it because they're afraid of getting kicked out of the market. China will retaliate.

And so we have no such, you know, I suppose who knows what they could do to us, but I'm sure we're not even on the radar. Hopefully, knock on wood. Well, I'll come back to what you're saying a moment ago about the chip industry too. If I'm in Taiwan, I'm worried because that's got to be one of the big deterrences. Of course, they're the chip makers of the world. If China, you know, catches up on that and they don't need any input from Taiwan, I worry geopolitically. Of course, that was the point of writing that piece. Once this barrier has been removed...

China is not looking to dominate the global semiconductor industry in the way that they are solar and EVs and other. This is much more serious to the Chinese. They are looking to become self-sufficient because once they become self-sufficient, this gives them maximum military flexibility. And in fact, if they are self-sufficient and they take out the Taiwanese semiconductors, what's the West going to do?

It's a very, very dangerous situation. And we see this pattern playing and we rang that bell in that piece because like, and still people in the West are so naive about it. Like, oh, they're still behind us. No, they're not. That's just what they're allowing you to see. The horse is out of the barn. Like, let's get ready for when the door is going to get slammed shut.

let me change gears here because right now there's the European union election, you know, for the European parliament. Uh, I guess it runs right through till Sunday. Uh, just fascinating that you've just written about this though. Uh, and I love it because this is obviously another pertinent subject, whether in the U S but, or Canada, especially because we like to follow that European model. Uh,

And I look at the energy policy, and you've written a great piece that talks about, hey, is this going to be the actual energy policy? Is it going to be the undoing of the EU? And maybe you could elaborate a bit on that. So the core of that piece is the, I think, undeniable observation that the green energy transition, quote unquote, is fundamentally incompatible with democracy. And what does that mean? Well, if you disconnect from fossil fuels and nuclear energy, it is fundamentally

Very difficult to deny that this necessarily means that the population will experience a substantial drop in its standard of living. Democracies are popularity contests, and nobody wants to voluntarily live a poor life.

And so the green energy transition, when executed, as the architects of that transition ultimately intended to be executed, never mind their polishing of the propaganda around what they think is going on. Deep down, they know what this means. It means less wealth for fewer people, fewer people on the planet in some cases. None of that is popular with people. And democracy is one vote per person. And ultimately, elections are popularity contests. And so taken to the extreme, which it inevitably must,

the proponents of the green energy transition who genuinely, some of them at least, believe that the world is legitimately going to end if they don't succeed and that justifies all manner of means considering the end they're trying to avoid, they very quickly slip into totalitarian instincts. And we see that in the EU and we'll see how Prime Minister Trudeau handles what looks like to be an election wipeout if he ever has the courage to call one. It's a very dangerous time.

the elite in Brussels think they know better. And the population in the EU, the population in Germany, the population in Slovakia, the population in Serbia, the population in Hungary, European countries, not all of them are in the EU, of course, but...

There's a partitioning between sort of the left and the right that is leading to political violence. We just had an attempted assassination of a European head of state for the first time in two decades. Europe is a powder keg and the elections are happening. Who knows how they'll turn out? We've seen two stabbings in Germany of what the media would call far right politicians of the AFD.

This is not positive, right? This is not healthy, civilized discourse like we talked about earlier. That's missing. There's we know better and you should shut up and take our policies mindset amongst the Trudeaus of the world, which was on full display during the COVID lockdowns as has been covered widely. So our view is something has to give.

And one of the things that might give is the nature of the European Union itself. And we might see a partitioning of countries who care about what their population wants and those whose leaders don't. And that could get ugly pretty quickly. Now, we don't want that. That is not our base case. But it's a risk on the board that people need to be aware of.

Let me add just, and I know time's short, so I'm going to finish this one thing. One of the things that I've really enjoyed in Doomburg is the technical and practical understanding of what that whole energy situation really required. But you've just recently written about, you know, if you want to do this stuff,

you realize how many kilometers of cable you have to add, you know, the transmission, all of those kinds of things. And I think, again, that still isn't very prominent. It's more so maybe, you know, than it was a year ago, but that's still not near as prominent as proponents should make it because if they think this is the way to go, they got a lot of questions to answer.

Well, one of the things that we've observed is that the copper market never really bought the hype. So if we were truly going to outlaw internal combustion engines and force everybody onto electric vehicles and electrify everything and heat pumps instead of furnaces, pick your favorite propaganda du jour from the progressive environmental left,

Copper would not be trading where it is. And many people have wondered what that means. And we've interpreted it as saying, you could either believe Tesla's market cap or the price of copper. And one of those two is more susceptible to market hysteria than the other. The copper market is sleepy. Almost no retail trades it. The price of copper in the last five years

tells us that nobody actually believed this would come to pass. And there's just no way copper would be trading where it is if we were truly going to go down this path and the market believed it. And so one of those two things isn't right. I'd argue one of those two things isn't still right, still isn't right. And they're not like tradable insights, they're just observations. Like we believe that when the market is...

not in sync with the narrative, the market is A, probably right, and B, trying to teach you something. And the price of copper never moved. You look at the 10-year chart of the price of copper and you point out where the green energy transition was believed by the market. It's not there. And by the way, then go ahead and adjust that chart for inflation. Mm-hmm.

The inflation-adjusted price of oil today is $23. People don't realize that. But based on 1980s money, which is what Bloomberg uses for its inflation-adjustment indices, which if you use the Bloomberg terminal, then that's sort of how you measure these things. But in 40-year-old money, the price of oil is the same price as it was when Reagan was president. And in 40-year-old money, the price of copper is pretty dirt cheap.

And given the fact that we have no real major new mines coming online and no major discoveries of high-grade copper like we used to find a century ago, the market just doesn't believe it. And I think Toyota is sort of the ultimate proof point where their hybrid strategy is now suddenly they're thriving in this market as we've come to realize that perhaps

you know 80 kilowatt hour batteries that only abate one driver's um gasoline use not their carbon emissions to be clear because electricity is still predominantly coming from fossil fuels today this was never going to be the the panacea that saves the planet time now for the quote of the week

You know, it's now pretty much crystal clear that overwhelmingly there was a huge amount of media coverage that censored COVID, including on social media. I mean, the goal was never to inform the public. It was to manage us. I mean, the no questions allowed is so far from science as one could possibly get. But yet it was the norm. And I'll add, for many people, the credibility of the media is never going to recover from that.

But one of the most egregious examples was the effort to stop anybody questioning where the origin of COVID came from. Which brings me to the quote of the week by biologist Matt Ridley, author of the bestsellers. He did Genome, Rational Optimist and Viral, The Search for the Origins of COVID-19. In quotes, the Chinese government and its scientists have yet to admit they caused the pandemic.

But in exactly the right city, at exactly the right time, they were playing with exactly the right kind of genetic insertion into exactly the right part of exactly the right gene of exactly the right kind of virus in exactly the right way. And they showed exactly the wrong kind of openness about it afterwards. It would be a heck of a coincidence and awfully bad luck if somehow COVID broke out naturally right there and at the same time.

Time now for the quote of the week. It was just over two weeks ago that BC Premier David Eby caved in to Muslim-slash-anti-Israel-slash-anti-Semitic groups and removed Selina Robinson, Minister of Higher Education, from Cabinet. Not coincidentally, she was the only Jewish member in Cabinet. The reason given was the comment she made during an online discussion on the Israel-Hamas dispute.

But as Terry Glavin's written in the National Post's great article, and more in-depth in his substack, The Real Story, that was simply not true. Mr. Glavin states, her comments during that panel were merely the pretext for a public execution that had been decided and planned months earlier. End of quote. Shortly after October 30th, when she and Premier David Evey announced Holocaust education was to become mandatory in British Columbia schools.

Now, for more detail, I say go and see Terry's column in the National Post. Better still, subscribe to The Real Story, his substack, where he goes into great depth on the group's pushing to get rid of the only Jew in cabinet. But I want to focus on something else here, focus specifically on what she said. I'm saying that because I still haven't come across anyone who actually heard her full comment.

The news widely reported the offending comment that Palestine was just in quotes, a crappy piece of land with nothing on it, end of quote. The remark was called deeply offensive, racist, colonialist. Now, Ms. Robinson apologized unreservedly twice. She stated she was commenting instead on the lack of resources of the area. And she further promised to take anti-Islamophobia training, but that wasn't enough. Groups demanded her resignation and they got it.

But even after the resignation, her office was vandalized. Look, not surprising in such an emotionally charged environment with the war in Gaza, with the October 7th atrocities and the unprecedented hate-filled anti-Semitism on display in Canada. But the need for a dismissal from cabinet has been hotly debated. Did she have to be dismissed? I say personally, given her apologies and remorse, I actually think it was an act of cowardice by the BC Premier and caucus.

Now, you're going to have your own thoughts. I appreciate that. But I want to come back to this. I'm wondering, did you actually hear what she said? And then you can decide whether it's deeply racist, profoundly hurtful, that it merited the public flogging administered by NDP leaders both Jagmeet Singh and David Eby.

Would they, our Premier Eby states, did this comment increase the risk of Islamophobia and anti-Arab racism in BC? You decide. Here's the quote. We have a whole generation of 18 to 34 year olds that have no idea about the Holocaust. They don't even think it happened. They don't understand that Israel was offered to the Jews who were displaced. So they have no connection to how it started. They don't understand that it was a crappy piece of land with nothing on it.

There were several hundred thousand people, but other than that, it didn't produce an economy. It couldn't grow things. It didn't have anything on it, end of quote. Well, as I say, each one of us can decide whether that's deeply racist and meriting dismissal from cabinet after a long career serving the province of British Columbia.

On the 2nd of November 2022, the House of Commons passed a motion that called for the Office of the Auditor General of Canada to conduct a performance audit of the government's management of the ArriveCan application. 149 Liberal members of Parliament voted against the audit. Conservative Bloc and NDP voted in favour. Hence, it has taken place. The Auditor General of Canada, Karen Hogan, in her office conducted the audit with the results released this week.

But you summed this whole thing up by saying it's the worst bookkeeping I think you'd ever seen. Let me just elaborate on what jumps out at you for that. I mean, you've been doing this a long time. You entered the Auditor General's office after a career in auditing and accounting in 2006. That's 18 years ago. So that's quite a statement.

And I mean, that statement really takes me back to the fact that I've been an auditor for almost three decades now and not just my time here at the Auditor General's office. And it is because what I would call some of the most basic elements of good financial management controls and good record keeping were important.

were absent in so many cases. At times we saw some invoices that were really well documented, contracts well managed and well entered into the financial records, but for the most part, that's not what we found. We found some basic elements like

what skills workers should have in order to work on a contract just not listed out. And then invoices were missing basic elements such that we couldn't determine whether the fees that had been charged related to the ARRIVE Canada application or another IT project that was on the way at the Canada Board of Services Agency. And that basic information should be there.

Let's start with what you estimate the cost of this was. As I say, originally budgeted $80,000 came in. I can't even do the math anymore. As a taxpayer, how much did this overall thing cost?

So we estimated that the ARRIVE-CAN application costs $59.5 million and it is an estimate because of the really poor financial records that we had. It could be less, it could be a little more. And I guess what I would caution is comparing it to the $80,000.

That was really to digitize a form, right? To take something that was in paper format and automate it and make it electronic. It didn't consider a lot of the other factors like security that needed to be around that form, how individuals might access it across three different operating systems, right?

the bilingualism, the need to link with provinces, all of that, which is complex, which means that it will cost more than what we've been hearing, isn't an excuse, however, to throw out all the rules and not make sure that you're spending money in a prudent and wise way. And we just didn't see that happening here.

So normally, processes to procure goods and services in the federal public service are competitive. And competition is great to ensure that you have many vendors bidding for the same thing that will hopefully keep the price down and result in better value for taxpayer money spent.

But at times, there is the need to either act quickly or for other reasons to not use a competitive process. But even then, you typically go out and at least solicit informal quick bids from a few vendors. You still try to make sure that you drive a little bit of

competition. And that happened here where three vendors were approached by the Canada Border Services Agency. Only one proposal, however, was received. That proposal was not from GC Strategies, and yet the non-competitive contract was awarded to GC Strategies. So again, you know, I actually think it's a bit of a head scratcher as to why this wasn't all well documented when it traditionally should be.

But what we found here is that the agency allowed the vendor to be involved in setting some of the selection criteria. And it was very narrow and restrictive that it likely limited competition. And in the end, and

GC Strategies was the only vendor to respond to the competitive bid and hence were then given the competitive contract later on. And that kind of involvement from a third party in setting selection criteria should just not happen. And that's why we issued a recommendation to the Canada Border Services Agency to ensure that that does not happen going forward.

Well, obviously, as you just mentioned, the pandemic was a difficult time. And, you know, the public service was, you know, they got to act right away. That was their instructions. But does that...

excuse the fact that you, as you said earlier, and we're talking some basic or fundamental policies that have been there, you know, established for ages about, you know, rules or controls in awarding contracts or managing the project, that kind of stuff. I mean, does that excuse that? We're talking really the basics. Mm-hmm.

So again, I feel like I'm doing this a lot. I'm taking us back to a time that most of us probably don't want to remember, which was the start of the pandemic, where things were, I mean, so uncertain and there was just so much going on and it was constantly evolving. And at that period of time, the secretary of the Treasury Board said,

provided a letter to the public service saying, in order to support Canadians, we need the federal public service to be quick and agile and responsive. And so they were given permission to relax some of the rules or to avoid some of the hoops that normally they would jump through. But it was very clear that the public service needed to still be able to document its

critical decisions and demonstrate due diligence and more importantly accountability to Canadians for money that was spent.

So in my view, the fact that these basic things were missed here, the pandemic can't be used as an excuse. An emergency isn't a reason, as I said before, to throw all the rules out the window. It's a reason to just make sure that along the way you document bits and pieces here and there because you might get overwhelmed and it might be just too much as things move along. And just that documentation or demonstration

of good accountability and transparency didn't happen here. - Let me finish with this because this is really troubling for me. This is a work that you've done on a particular project, the ArriveCAN app. One of the things you told me in the past, told our audience in the past is anytime you get a couple of departments together, responsibility and accountability sort of gets more difficult within that framework. But man, I just can't believe the theme of

at times, mismanagement, et cetera, has been echoed from Denny DeSotel and, of course, Sheila Fraser, you know, the late Michael Ferguson, you know, who looked at the Phoenix pay system and said it was incomprehensible how poorly it was managed. And now we arrive here. I think it's discouraging. For me as a taxpayer, it undermines my confidence in the system or, you know, in government as a system and expenditures. And I just...

As I say, I find it depressing. I could have read this kind of a report 20 years ago, 30 years ago, 40 years ago out of the Auditor General. I have to admit that for me, it is a huge head scratcher to see the absolute glaring disregard for some of the most basic things.

practices, principles and policies that we would normally see the public service follow. And it's just not about record keeping. It was, as you say, about project management and good oversight. And there was confusion here too at the start of the pandemic between the Canada Border Services Agency and the Public Health Agency of Canada.

Neither agreed on what their roles would be. They both felt the other would set up good governance structures and in the end there was no oversight, no governance, no goals, no objectives. And so, you know, the big finding of, you know, the value of this really boils down to how do you manage to a budget when you actually don't have a budget?

And, you know, I know the public service can do better. We've looked at other contracts throughout the pandemic, and while we have opportunities for improvement, they did do better. They were able to still demonstrate prudent use of public funds and the due diligence they exercise. But here it was just an accountability void that really shouldn't have happened.

Time now for the shocking stat of the week. You may not appreciate this, but since 2006, the Canada Pension Plan has used what's called active management as opposed to passive. Like if you buy an ETF, that's passive management. But they've chosen to go to active management since 2006 to pick and choose investments in real estate or private equity, infrastructure, publicly traded stocks.

In order to do so, though, this isn't a shocking stat, but it's shocking. Well, the number of people working at the Canada Pension Plan went from about 150 employees in 2006 to 2,100 today. Actually, more than that. Well, not surprisingly, the costs exploded. And I do mean exploded. They're 97 times higher.

The cost of that administration, the whole thing, went from $36 million in 2006 to $3.5 billion in 2024. And when transaction costs, you know, I mean, you have to pay when you buy and sell stuff and you've got an office, that kind of stuff, other operating expenses are added in. It's $5.5 billion annually.

Well, all of that could merit a shocking stat, but it isn't. For that, we go to the Canada Pensions Plan performance. In other words, what did we get in return for spending tens of billions extra in high price management? Well, I have to admit that immediately when I saw the average rate of return, which is over that period, 206 up, 7.7% annually, I thought, my gosh, I did a lot better than that.

But more importantly, as Andrew Coyne of the Globe and Mail points out, 7.7% annually didn't even meet the rate of return of the Canada Pensions Plan own benchmark, what's called the reference portfolio, which is about 85% equity, 15% bond. But it didn't match the return, not just last year, but it hasn't in the 18 years it's been under active management.

Think about this. If instead of going that way, they could have saved all that huge jump in administration, just turn the money over to Stanley Druckenmiller's Duquesne Capital. Are you kidding?

His average was 30% per year. And maybe take a chunk of that money, give it to Buffett's Berkshire Hathaway, which has averaged over 28% annually for the last 20 years, or Ken Griffin's Citadel. I mean, we would have saved billions in costs and made a heck of a lot more money. You know what? My problem after knowing all that, I can't get that tune by dire straits, money for nothing out of my head when I read these reports. Time now for the shocking stat of the week.

California's rooftop solar industry has received government subsidies for years that offset installation costs for homeowners and businesses. In California, all new homes must have rooftop solar. And if the home products, you know, if the home actually produces excess power, well, the government actually rebates up to two to three times the price of wholesale electricity to the homeowner. Obviously an incentive to produce energy, even if they know it exceeds demand.

Well, that way, more well-to-do families who can afford the solar panels can reduce their electricity costs to zero. But, you know, somebody has to pay. And as usual, it falls to lower income groups who can't afford the panels or don't own a single detached family home.

But in December of this past year, no, December 22, it was actually, the state reduced the subsidy for excess power by about 75%. So up to this point, they've been paying two to three times the price of wholesale electricity to those homes that have excess power put into the grid. Well, as I say, reduced by 75%. And it revealed that the industry was not profitable unless it had that government subsidy. So here's the shocking part.

reported in the Wall Street Journal. California's solar and storage industry claims that the reduced subsidy has already resulted in one year in the job losses for 17,000 people. And why? Because installation applications fell by 80% without those government subsidies. So now, Solar Insure, that's one of the big companies there, says that three quarters of solar installers are high risk of going out of business.

Well, in fact, it wasn't much of a business. It was only a business because it had those government subsidies.

We're very fortunate on Money Talks to be able to talk to and call on Terry Glavin. Well, there's a lot of subjects Terry covers, but I'm going to talk specifically about the Chinese interference and the inquiry there. But you can find him at therealstory.substack.com. I am a subscriber. Many of our fellow...

Money Talks listeners are, and it's worthwhile. I mean, that's why people subscribe to stuff, because the background that I get informed with – and I know these subjects, but not near as well as Terry Glavin does –

So I get the background. I get some history. I get the latest stuff. So that's why I'm so pleased that he is kind enough to share his time with us. Terry, thank you for taking this time. I know, hey, there's no shortage of things that are keeping you busy these days. 34 different CSIS documents since 2018 have gone into these subjects very, very, very intensely.

You know, very specific things that Jeremy Broadhurst, for instance, and Katie Telford, who was the campaign manager for the Liberals during the 2021 election, and Katie Telford, his chief of staff, saying, oh, my goodness, we haven't heard any of this stuff before. It's all news to us. Am I losing my marbles here? Yeah. Yeah.

This stuff, CSIS, the director of operations for CSIS, I think it was, gave this testimony verbatim in public committee hearings. David Vigneault, in a number of speeches, submissions to the National Security and Intelligence Committee of Parliamentarians, what a mouthful, that have been published by NSI, it's all there.

It's all there. And they're saying, oh, gosh, you know, he didn't know. And one of the more outrageous things that I think came out of the hearings, it's just like I can't understand how these people can sleep at night.

is Trudeau saying, you know, it kind of seems implausible that the Chinese would want the liberals to be re-elected over the conservatives. What? And then who was it? LeBlanc saying, yeah, I just don't think CSIS is smart enough to figure out the political preferences of the Chinese Communist Party. Are you kidding me? Yeah. You have on the record...

The China Times, Xinhua, major figures in the Chinese Communist Party, the ambassador, for God's sake, in Ottawa, saying, you know, how horrible Aaron O'Toole is and how, you know, anti-China, you know, what was his predecessor? Was it Li Kiki? No, it wasn't. What was his name?

I forget. But the ambassador before said, well, all our concerns, you know, it's just it's white supremacy. Yeah, they really they wanted a liberal minority government. They wanted Aaron O'Toole's career to be destroyed. They wanted particularly Michael Chong and Kenny Chu and Jenny Kwan. Bless her heart. The sole Democrat in this picture.

They wanted them gone, and they got rid of them. And the Chinese consul in Vancouver was said in a conversation that was intercepted by CSIS, he was boasting about it. Yeah, we got rid of those guys. And for them to say, gosh, this is news to us and seems implausible, when you had, you know, people have to remember that the Trudeau government got elected.

to serve the purposes that the United Front Work Department is devoted to and is assigned to carry out. The United Front Work Department is being recently merged with the Overseas Chinese Affairs Office. It is the overseas strong-arm, influence-peddling, palm-greasing infrastructure of the Politburo of the Communist Party of China, the Chinese Communist Party.

And its budget is bigger than that of the entire Chinese foreign ministry. And they are deeply integrated and embedded in the Mandarin block in this country. And it's a very awkward and an indelicate subject to raise, but I'm afraid it's true. And what do you do? You know, the way I put it is like, what do you do, right? If you're a CSIS agent and it's your brief, right?

You're working with your Five Eyes partners in the US, FBI, CIA, and you're working with MI6 and MI5 in Britain and with the Australians and the Kiwis. And your job is to keep an eye on the United Front Work Department and its operations in, say, the Greater Toronto Area. And you find very, very quickly that

that all of the senior operatives in the United Front Work Department are indistinguishable from the senior fundraising, king-making, candidate selection individuals in the Liberal Party of Canada. What do you do? So, you know, I mean, it really is that bad. It's gone that deep, and...

I don't know. I have a couple of theories about why the penny hasn't quite dropped yet, but that's basically how deep it is.

Well, you know, I mean, I was surprised. I wasn't aware of them having, first of all, nomination meetings where 14-year-olds could vote because they can't drive and they can't do many things. They're not considered an adult. And then we find out, and thanks to you at therealstory.substack.com, you know, you were writing about the fact that the United Front work group was actually threatening the students who were getting bussed in

you know, you better vote this way, you better cooperate. I don't know what I expected, but that was obviously a revelation to me, but a shocking one. Yeah, and here's, you know,

And both Handong and Trudeau have behaved from the very beginning. When I say the very beginning, I mean, I guess it was, was it February 23 or was it? Anyway, when Sam Cooper's story started to break, you know, denying up and down that this had been happening. And then, you know, the more granular detail we started to get on it, Handong has changed his story three or four times already.

He's lately recruited that. Yeah, I was recruiting students from that school. It's the New New Oriental College or something like that, which, by the way, has its own Communist Party unit embedded in the faculty. And Trudeau had been at dinners at that school. And, you know, here's the funny thing.

You don't actually need a CSIS. If you pay really close attention over the years and you develop contacts in the community, it's not like they didn't know. They knew. They knew before Sam Cooper's stories came out. They knew before Jeremy Broadhurst was briefed by CSIS that there were all these irregularities at Handog's nomination ceremony.

They knew before Broadhurst advised Trudeau, briefed Trudeau on what CSIS had told him. They knew before the candidate election itself, months before they knew. Anybody paying attention knew. I knew. I talked to Gerald Butts about this. I said, what is the deal?

Handong is their guy. He launched, he made his announcement that he was going to run for the Liberal nomination in Don Valley North from the headquarters of the main United Front Work Department structure in the Greater Toronto area, which is the Confederation of Chinese Canadian Organizations, I think it's called.

Big, big shot there is a fellow by the name of Wei Cheng Yi. He's a multi, multi, multimillionaire. He's a real estate and grocery chain magnate. He was a former member of the Chinese People's Political Consultative Conference in Beijing only from a couple of years ago.

He was the director of an overseas Chinese affairs office institution that was run directly from the 9th Bureau of the United Front Work Department. The guy is like the godfather, right? And he announced, and one of his branch plants, by the way, remember those Chinese police stations? Oh, absolutely. One of them was in one of his branch plants. It was the same address. He was the landlord. And so he announces his candidacy.

from Wei Cheng Yi's headquarters. Michael Chan is standing right behind him. Michael Chan has been watched by CSIS for years. Michael Chan was also, in 2019, the co-chair of our trade minister's election campaign, Mary King. I mean, what do you do, right? You're just a guy. You're a CSIS agent. You're tapping phones. You're writing stuff down.

Everybody knew, Michael. Everybody knew. And what does Butt say to me? Oh, I've known Ham Dong since he was a kid. He's just a fine. It's like accusing Terry Glavin of being a sleeper self at the Irish Republican Army. Thanks a lot. Yeah.

I don't know exactly. I think a lot of people read this stuff and it's so outlandish, it's so unbelievable that a lot of people think, no, this can't be true. Late last year when the House Affairs Committee on China released its report, which had all of this evidence from CSIS, and Ken Hardy, who was the chair of the committee, nice man, he's a liberal,

You know, he said, well, I guess we, you know, we should have been listening to Jonathan Mantler. Very glad we all lost. Well, that's very nice of you, Ken. But you know what? It doesn't seem to have really made a difference. And I think part of the difficulty is we've been covering this story under the sort of rubric of foreign interference. Yes. Well, is it interference if it is? I mean, interference is something that is unwanted and unhelpful.

There was nothing unwanted or unhelpful about the participation of the United Front Work Department hierarchy in the Mandarin block in this country and the consulates and the embassy. There was nothing unwanted in their engagement with the Liberal Party. It looks a lot more like collusion to me. I know these are terrible things to say, but, you know, you explained – somebody's got to explain to me, and no one has explained this yet –

how it came to pass that over a 48-hour period in 2016, so we're going back a ways, right after the election, over a 48-hour period, 68%, I think it was, of the Papano, Trudeau's writing, his war chest was replenished by...

All of these donations that just curiously were just below the $1,500 threshold. I mean, that's what happens when you look at casino gambling. Mm-hmm.

When you look at the way Chinese whale gamblers get their money out of China, or buy houses in Shaughnessy, they'll distribute a whole bunch of below-the-radar donations to various people in Canada who will put it in a single bank account, and then a big lump sum goes to a bank in China, this kind of thing. Somebody rigged that. Somebody rigged that.

I think it was like 62 different donations in one 48-hour period, minimum. And then you have the prime minister of our country inviting liberal donors to cash-for-access dinners, one of which, by the way, I think the first, was Lee Kee Kiang attended this dinner. I mean...

His policy was to integrate Canada's economy and our immigration policy and our foreign policy hip and thigh with the Chinese state-owned enterprises, the Chinese government's foreign policy economy. I mean, it's all there. It's on the record. And I think this is the part of the difficulty. You know, people look at this and they just say,

Some people look at it and they say, what do they have on Trudeau? My goodness. You know, they must have something on him. You know, he wouldn't be, surely he wouldn't be doing this sort of thing unless they had some sort of, you know, compromising information on him. People have to wake up and realize that Trudeau and his circle

Dominic Barton, Peter Harder, Yen-Pow Wu, Mary Ng, they don't see anything wrong with this. This is not something to be – it's something to be hidden from the public because they know that the public finds all of this quite revolting. But they don't see things this way. They have a completely different conception. It's a post-national idea.

of the country. And, and of course the immediate question that emerges is, well, how do you do national security in a post-national state? What does that even mean? Yeah. So, yeah, I think a lot of this stuff is coming out now sort of on the record in the, in the, in the,

trove of terribly utterly i mean there's no indexing at all in the uh the archive of submissions to the inquiry i mean it would be a really interesting project to hire a summer student to go through everything and properly organize and index the submissions um but yeah it's uh it's going to be interesting we've got uh

You know, we have an opportunity now for the United Front Work Department and its senior interlocutor, who's basically recognized as such by Justice Ho, Yen-Pow Wu. He's going to be defending them and defending their interests. You know, there's some sort of equity-seeking group now. Mm-hmm.

Well, it's been an overwhelming task to keep on top of it. I'm not telling you anything because you've been keeping on top of it. And I appreciate your time here, but there's so many more chapters to go in this story that I hope I can call on you. But in the meantime... Yeah, it's not really bang on like this. This should really be more of a conversation, but it's... No, no. It is overwhelming. There's just so much. Time now for this week's Goofy Award. You know, the question I've continually encouraged people to consider is,

Since October 7th, we watched things like the growing incidence of anti-Semitism. We had the street protests, of course, the targeting businesses with a Jewish connection, blocking traffic. We had one group sort of target a Jewish child care center. The list just keeps going on. Obviously, university students with Jewish backgrounds have been threatened on campus. They've shut down classes. But all of it's been met with a weak response from government.

regularly refusing to enforce our own hate crime legislation or the rule of law in general. My point has always been to ask, where do you think this ends? Well, my answer has been escalation and violence. As New York City Mayor Eric Adams, he's a Democrat, stated that this week in light of the escalation of pro-Humas protesters shutting down Columbia or City University of New York, he stated, we should have taken action when the first tent went up.

You know, as former politician, well-known advocate for the rights and self-determination of Muslim women, Somali-born Ayaan Hirsi Ali stated, don't be fooled. The protests defiling our universities may be naive, amateurish, but they are the harbinger of far worse to come. I'm not disagreeing with that. I guess it's a reminder that for some people it's never enough. I mean, they're always oblivious to this. We need a wake-up call. Well, we're going to get one because there's going to be other opportunities.

For example, think about this. We've got the anti-Western, anti-Canadian values group joining in now. So at Columbia, you had the New York police come in on Tuesday. Of the 282 protesters arrested, 134 of them had no affiliation or connection to the universities. That's a similar kind of thing we're seeing in other campuses, including in Canada. And that brings me to this week's Goofy.

Well, I'm going to add a little humor to the situation or irony or whatever you prefer how to describe it to the serious situations on university campuses. Or maybe better put, it was just simply my WTF moment when I heard the protest spokesperson demand humanitarian aid for the occupiers of Columbia University's Hamilton building.

Columbia, or the main spokesperson, whose real name is Johanna King-Sledsky. She's now been nicknamed Johatti Johanna. She claims that the Ivy League students in the middle of Manhattan need basic humanitarian aid. Humanitarian aid? You mean like Haiti and Congo? At an Ivy League school who charges $80,000 for tuition? Oh my gosh, the suffering must be unbelievable. The humanity of it all. I love the way UK journalist Eve Barlow put it.

She said, can we please get an airdrop at Columbia University? We need 900 acai bowls, 1300 impossible burgers on gluten-free bread with sugar-free vegan ketchup and 3000 bottles of pH 9.0 electrolyte water. This is urgent. And by the way, this is another one of those, you can't make this up. Johanna, the spokesperson, this is her PhD dissertation. In her words,

is on fantasies of limitless energy in the transatlantic romantic imagination from 1760 to 1860. My goal is to write a prehistory of metabolic rift, Marx's term for the disruption of energy circuits caused by industrialization under capitalism.

Can hardly wait to read it. But don't be too concerned with any of the consequences for the pro-Hamas protesters. They may have been expelled or banned from university for a while, but Shereh's university in Iran is offering scholarships to students, whether it's the UK, EU, or US, or Canada, who've been expelled for, in Iran's words, free speech. As if the Iranian government would know anything about free speech.

Well, it's time for this week's Goofy Award, and I'm going to start with this. The Cambridge Dictionary defines arrogance as "unpleasantly proud and behaving as if you know more or are more important than other people." Why am I talking about it? Because that's the word that comes to mind when I hear the constant harangue of politicians.

who act as if, man, they're delivering the modern version of Sermon on the Mount and telling us what's fair and what's not. Of course, we've been getting a heaping helping of that recently with talking about the rise in the capital gains exemption rate from the prime minister and the finance minister, talking all about it's not fair that upper income people, or they call them the wealthy, aren't paying their fair share of taxes. Now, come on. They act as if the word fair is not highly subjective.

Instead, it's like an absolute according to their wishes. Or to put it in the Cambridge Dictionary terms, they behave as if they know more or are more important than the rest of us.

I mean, it's meant to manipulate us, but it's also insulting. It's disrespectful to suggest that individuals can't decide for themselves what's fair and what's not. No, it's not a new tactic. I mean, it's been used by politicians for years to rationalize more government intervention. It's kind of like the essence of socialism, where if the outcomes aren't equal, then something's wrong.

But they have to not take into account work ethic or talent or any other variable that produces an outcome. Instead, the government has to intervene.

Now, I got to be full disclosure here. I don't need a politician to tell me what's fair and what's not. Now, you can decide for yourself if you think, for example, the top 10% of income earners who pay well over half of all income collected is fair or not. You can decide whether it's fair that the average Canadian family gives all it earns to government

for the whole part of the year, right up to June 13th, before it starts working for itself. You can decide if passing on record debts, interest payments on that debt to younger generations is fair. I mean, obviously the government does, its supporters do, but that's their prerogative. But the question is, what do you think?

Do you think it's fair that during the pandemic, members of parliament voted themselves three raises? They did it on April 1st, 2020, 2021, 2022 during the pandemic. Oh, they didn't stop there. They also voted themselves a raise in 2023, 2024. Do you think that's fair when the rest of us are struggling? So many Canadians really having a tough time.

Was it fair that on a six-day trip to Asia, as we found out this week, Prime Minister took it last year with his son Xavier, a regular entourage of politicos, that could be as much as 72 on some legs of the trip to as low as 37. But here's the thing. Was it fair that they could spend $223,234 in in-flight catering alone?

I mean, come on, that is the equivalent of what 1,734 Canadians spend in a week on food. I mean, is it fair that led by the NDP Liberal government, MPs have decided to close down Parliament this week for 13 weeks? I mean, which for the majority is kind of a nice long paid vacation, paid for by taxpayers. I don't think many of us get that.

My point is that government MPs or any MPs are hardly the ones to be lecturing us on what's fair. But if you need the received wisdom of the Prime Minister and the Finance Minister and other members of government or any politician to explain that to you, well, so be it. Meanwhile, you've got to forgive me. I find it nauseating.

You know, there's so much more we could do, but let me just stop at that and say thank you for listening. I'm glad you did. Pass it on to your friends, though. That's the thing that I appreciate the most. And remember, you can join us on YouTube with Michael Campbell's Money Talks on YouTube. Get everything there. I really think you should also join us on Money Talks Tweets or Michael Campbell's Money Talks on Facebook. I know I say this all the time, but it is remarkable.

how many things we post that you will have a trouble finding in any of the mainstream legacy media. I think it just helps to expand what the world we're living in, make better decisions, interesting perspectives. It's okay to be challenged and that's exactly what we try and do. In the meantime, I'll see you next week. Regular programming again, but I hope you have a fabulous week.