1
00:00:15,058 --> 00:00:18,394
Banks got bailed out!
We got sold out!
2
00:00:18,478 --> 00:00:22,231
Here's a question,
do you trust the government?
3
00:00:22,732 --> 00:00:25,735
I don't always.
I've seen them bail out Wall Street
4
00:00:25,818 --> 00:00:30,615
while the average American struggles.
I've seen them attack peaceful protesters.
5
00:00:30,698 --> 00:00:33,076
And come on,
I know what the TSA is really doing
6
00:00:33,159 --> 00:00:35,661
with all my confiscated weed gummies.
7
00:00:35,745 --> 00:00:39,165
Banks got bailed out!
We got sold out!
8
00:00:39,248 --> 00:00:42,085
But you know what
I realized, there is one way
9
00:00:42,168 --> 00:00:46,047
in which we all do implicitly
trust the government every day.
10
00:00:46,130 --> 00:00:50,259
We use money,
and money is nothing but trust.
11
00:00:50,343 --> 00:00:54,013
See the only reason this
random piece of tree pulp is worth a buck,
12
00:00:54,096 --> 00:00:57,683
is because the government
says it is and because we all believe them
13
00:00:57,767 --> 00:00:58,893
when they say it.
14
00:00:58,976 --> 00:00:59,977
You know, it's funny the…
15
00:01:00,061 --> 00:01:03,606
the bill says "In God we trust"
on it, but I'm an atheist.
16
00:01:03,689 --> 00:01:06,317
I don't trust God, I curse God!
17
00:01:07,360 --> 00:01:11,739
Eh, it's probably a coincidence.
No, we trust the government.
18
00:01:11,823 --> 00:01:14,742
That's why none of us
would agree to get paid in IOU's
19
00:01:14,826 --> 00:01:17,411
or autographed headshots of celebrities.
20
00:01:17,495 --> 00:01:21,082
-Uh, do you accept Danny DeVito's?
-Cash only, Bub.
21
00:01:21,165 --> 00:01:23,584
-What about Johnny Cash?
-Who?
22
00:01:26,129 --> 00:01:29,090
But everyone accepts
the good old American greenback.
23
00:01:29,173 --> 00:01:33,052
A dollar?
What do you think this is, 1990?
24
00:01:33,135 --> 00:01:34,637
Five bucks a glass, grandpa.
25
00:01:34,720 --> 00:01:37,098
Okay, age comes for us all kid.
26
00:01:37,598 --> 00:01:39,934
You know, I used to think
that the only time the government
27
00:01:40,017 --> 00:01:43,312
interacted with my money
is when I paid my taxes
28
00:01:43,396 --> 00:01:45,106
or that one time I bribed a judge,
29
00:01:45,189 --> 00:01:48,693
but it turns out that the
government and our trust in it
30
00:01:48,776 --> 00:01:52,238
actually impacts every
moment of our financial lives.
31
00:01:52,321 --> 00:01:55,533
So what happens
when that trust breaks down?
32
00:02:02,373 --> 00:02:05,418
You know, I take for granted
that when I put my money in the bank,
33
00:02:05,501 --> 00:02:08,296
it'll stay there. But why?
34
00:02:08,379 --> 00:02:12,508
Why do I trust a faceless
corporation with my life savings?
35
00:02:12,592 --> 00:02:15,636
I mean, they don't even
trust me with their pens.
36
00:02:16,137 --> 00:02:19,932
Well, up until a century
ago, most Americans didn't.
37
00:02:20,016 --> 00:02:23,811
See, back then,
it was common for banks to uh, fail.
38
00:02:23,895 --> 00:02:26,898
And when that happened,
your money would be gone.
39
00:02:27,732 --> 00:02:30,776
Howdy handsome, the cupboards
are bare and the kids are crying.
40
00:02:30,860 --> 00:02:33,196
I need to dip into the kitty,
or my goose is cooked.
41
00:02:33,279 --> 00:02:34,363
Sorry lady,
42
00:02:34,447 --> 00:02:37,408
this Depression's got our balance
sheet redder than W.C. Field's nose.
43
00:02:37,491 --> 00:02:38,910
Your cash has flown the coop.
44
00:02:39,619 --> 00:02:42,830
Americans could become
so afraid of losing their savings
45
00:02:42,914 --> 00:02:46,167
that any sign of
instability would cause a panic.
46
00:02:46,667 --> 00:02:50,421
Hey gang! These phony four-flushers
won't make good on our Mazuma!
47
00:02:54,175 --> 00:02:56,177
Depositors would bum rush the banks
48
00:02:56,260 --> 00:02:59,096
trying to withdraw all of
their money simultaneously.
49
00:02:59,180 --> 00:03:00,932
This was called a bank run,
50
00:03:01,015 --> 00:03:03,643
and it could push even
healthy banks into bankruptcy
51
00:03:03,726 --> 00:03:07,146
resulting in a calamitous
cascade of closures.
52
00:03:09,273 --> 00:03:13,402
During the Great Depression,
over 9000 banks failed.
53
00:03:13,486 --> 00:03:18,032
Americans lost billions in savings.
The economy ground to a halt,
54
00:03:18,115 --> 00:03:22,703
and public outcry forced President
Franklin Delano Roosevelt to act.
55
00:03:23,454 --> 00:03:25,247
One at a time, one at a time.
56
00:03:25,331 --> 00:03:26,707
I lost my life savings.
57
00:03:26,791 --> 00:03:29,126
I lost the proceeds for my moonshinery.
58
00:03:29,210 --> 00:03:33,255
I thought we were all wearing
barrels to this, or did plans change?
59
00:03:33,339 --> 00:03:35,800
Alright, alright. How about this?
60
00:03:35,883 --> 00:03:38,344
To restore trust in the banking system,
61
00:03:38,427 --> 00:03:42,098
we will create the
Federal Deposit Insurance Corporation.
62
00:03:42,181 --> 00:03:44,976
Your deposits
henceforth will be guaranteed
63
00:03:45,559 --> 00:03:49,230
by the full faith and credit
of the United States government.
64
00:03:49,313 --> 00:03:51,274
What if the bank burns down?
65
00:03:51,357 --> 00:03:52,566
You'll get your money back.
66
00:03:52,650 --> 00:03:55,945
What if Bonnie and Clyde
get in there and mess up the joint?
67
00:03:56,028 --> 00:03:57,613
You'll get your money back!
68
00:03:57,697 --> 00:03:58,948
What if you got a telegram
69
00:03:59,031 --> 00:04:01,826
saying everyone would be wearing
barrels to the speech, but no one did it?
70
00:04:02,660 --> 00:04:04,203
It's guaranteed, okay!
71
00:04:07,081 --> 00:04:10,459
Can I withdraw one penny please?
Thanks so much.
72
00:04:10,543 --> 00:04:14,714
At the time, this was considered
an extraordinary measure, but it worked.
73
00:04:14,797 --> 00:04:18,718
The FDIC stabilized
the banking system, restored trust,
74
00:04:18,801 --> 00:04:21,304
and made bank runs a thing of the past.
75
00:04:21,387 --> 00:04:24,515
Today, when you see
that FDIC logo at your bank,
76
00:04:24,598 --> 00:04:28,936
it means that up to
250,000 dollars of your money per account
77
00:04:29,020 --> 00:04:31,605
is fully insured
by the federal government.
78
00:04:31,689 --> 00:04:36,319
And since 1933, not one penny
of insured deposits has been lost.
79
00:04:36,402 --> 00:04:40,614
And that is all the more impressive
because bank failures still happen.
80
00:04:40,698 --> 00:04:43,993
It's just that nowadays,
instead of causing a panic,
81
00:04:44,076 --> 00:04:49,332
the FDIC swoops in so seamlessly
that almost no one even notices.
82
00:04:49,874 --> 00:04:50,916
How do they do that?
83
00:04:51,584 --> 00:04:55,546
Tell you what, heads we go
find out, tails the show ends now.
84
00:04:56,505 --> 00:04:58,049
-Oh, man, what?
85
00:04:58,132 --> 00:04:59,258
Okay, this one doesn't count.
86
00:04:59,342 --> 00:05:00,593
-Let's go again.
87
00:05:02,303 --> 00:05:04,138
-Hey!
88
00:05:10,311 --> 00:05:14,190
-Hi there.
-Hello, and welcome to the FDIC, Adam.
89
00:05:14,273 --> 00:05:16,567
This is like the
bankiest place I've ever been.
90
00:05:16,650 --> 00:05:20,196
Come on, let's give a little
tour. We're conducting a simulation today.
91
00:05:20,279 --> 00:05:21,906
-Oh, really?
-So I've told them that I was
92
00:05:21,989 --> 00:05:24,200
gonna invite you to step in
and observe the meeting.
93
00:05:24,283 --> 00:05:25,117
Would you like to do that?
94
00:05:25,201 --> 00:05:27,953
Oh, my God, that'd be incredible.
We can see what happens when a bank fails.
95
00:05:28,037 --> 00:05:29,288
-Let's go on up.
-Let's do it.
96
00:05:29,372 --> 00:05:32,041
-Adam, here they are. Good morning.
-Oh, my gosh, hello everybody.
97
00:05:32,124 --> 00:05:34,960
Thank you for having us. This is
very official, I'm a little nervous.
98
00:05:36,796 --> 00:05:39,507
Alright. So, welcome
everybody to this executive briefing.
99
00:05:39,590 --> 00:05:44,386
We are here for ABC Banking Company.
The code name is Kodiak.
100
00:05:44,470 --> 00:05:46,889
This bank was founded in 1948,
101
00:05:46,972 --> 00:05:49,683
and the bank has 23 retail
branches across two states.
102
00:05:49,767 --> 00:05:52,269
The bank's been
unprofitable for several quarters,
103
00:05:52,353 --> 00:05:55,314
and we've prepared
a strategic plan for resolution.
104
00:05:55,397 --> 00:05:57,274
The on-site team will be
working through the weekend
105
00:05:57,358 --> 00:06:00,611
so that insured depositors
always have access to their funds.
106
00:06:00,694 --> 00:06:03,739
We wanna make sure the bank opens up
Monday morning at 8:30, just like normal.
107
00:06:03,823 --> 00:06:05,574
So this is a bank that's failing,
108
00:06:05,658 --> 00:06:09,036
so there's 60,000 people
who have accounts at this bank,
109
00:06:09,120 --> 00:06:12,414
the bank is going down, they don't
know that you're here talking about…
110
00:06:12,498 --> 00:06:16,210
They do not. Yep, we try to do
our best to fly under the radar and
111
00:06:16,293 --> 00:06:18,462
make sure that
the financial system stays stable
112
00:06:18,546 --> 00:06:20,631
and that depositors
don't have any disruption.
113
00:06:21,215 --> 00:06:24,009
So if a bank fails
and you don't find the acquirer,
114
00:06:24,093 --> 00:06:27,471
what, FDIC just ends up
owning everything the bank owns?
115
00:06:27,555 --> 00:06:28,722
That can happen, yes,
116
00:06:28,806 --> 00:06:31,100
but sometimes we also can own things
117
00:06:31,183 --> 00:06:33,269
that an acquiring
bank doesn't want to own.
118
00:06:33,352 --> 00:06:34,562
Really, like, what?
119
00:06:34,645 --> 00:06:38,649
Well, back in the 80s, we had a
minority share in the Dallas Cowboys,
120
00:06:38,732 --> 00:06:40,734
-for a very short period of time.
-Wait, really?
121
00:06:40,818 --> 00:06:42,528
Did you get free tickets or what?
122
00:06:42,611 --> 00:06:44,905
-Unfortunately, no.
-That's a bummer.
123
00:06:44,989 --> 00:06:48,409
Uh, we've had rights to
a horror movie that starred,
124
00:06:48,492 --> 00:06:50,619
uh, George Clooney and Charlie Sheen.
125
00:06:50,703 --> 00:06:54,623
I think it was called
Grizzlies II, and, uh, yeah.
126
00:06:54,707 --> 00:06:56,667
So, how often does this happen?
127
00:06:56,750 --> 00:06:59,962
Recently, it's been less and less because
the economy has been doing very well,
128
00:07:00,045 --> 00:07:02,089
but we did have
a significant period of time,
129
00:07:02,173 --> 00:07:05,009
-if anybody remembers back in 2008, where
-Yeah.
130
00:07:05,092 --> 00:07:07,344
we had hundreds of bank closings.
131
00:07:07,428 --> 00:07:11,182
Wow! That must have been
a very busy time for you in 2008.
132
00:07:11,265 --> 00:07:14,727
The important thing
to know is the cost of bank resolution
133
00:07:14,810 --> 00:07:16,645
is not born by the taxpayer.
134
00:07:16,729 --> 00:07:20,107
We have a Deposit Insurance
Fund, that's funded by banks
135
00:07:20,191 --> 00:07:22,443
who pay premiums
based on their risk profile.
136
00:07:22,526 --> 00:07:24,153
I love it. Yeah,
make the banks pay for it.
137
00:07:24,236 --> 00:07:27,531
It's the… if--
It was their fault.
138
00:07:27,615 --> 00:07:29,742
So we're going to go over to a bank branch
139
00:07:29,825 --> 00:07:31,869
and simulate the bank closing speech that
140
00:07:31,952 --> 00:07:33,954
we give on Friday
night after the bank closes.
141
00:07:34,038 --> 00:07:35,164
Let's do that, please.
142
00:07:35,247 --> 00:07:38,751
Alright, first off, I've been
given this honorary pin to uh…
143
00:07:38,834 --> 00:07:41,045
-to pin on you.
-What? Wow.
144
00:07:41,921 --> 00:07:45,591
-I'm… I'm an FDIC official. Incredible.
-You're ready to go. You look nice.
145
00:07:45,674 --> 00:07:47,301
Actually, you could do the part.
146
00:07:47,384 --> 00:07:48,844
You know what? I feel cool.
147
00:08:06,904 --> 00:08:09,073
Alright. Yeah, we are locked out.
148
00:08:09,615 --> 00:08:11,742
Classic.
149
00:08:11,825 --> 00:08:14,787
So I thought I would set
the stage with you before we go in there.
150
00:08:14,870 --> 00:08:18,207
You know, as the FDIC we don't like it
when banks fail, we just, we're there
151
00:08:18,290 --> 00:08:21,460
just in case it does happen.
This is an emotional situation,
152
00:08:21,544 --> 00:08:22,962
it's something that
we need to work through.
153
00:08:23,045 --> 00:08:26,257
I think about being professional.
I think about being compassionate,
154
00:08:26,340 --> 00:08:27,925
-Yeah.
-and I think about being respectful.
155
00:08:28,008 --> 00:08:29,885
Professional, compassionate, respectful.
156
00:08:29,969 --> 00:08:31,262
-Excellent.
-Let's do it.
157
00:08:32,388 --> 00:08:34,473
Hello, can you please tell me
where the bank president is?
158
00:08:34,557 --> 00:08:35,808
Yes.
159
00:08:36,767 --> 00:08:38,394
-Hello, are you Jerry?
-I am.
160
00:08:38,477 --> 00:08:41,564
Hi, nice to meet you. My name
is Tyler Caviness, I'm with the FDIC.
161
00:08:41,647 --> 00:08:44,066
Alright, so now is the moment
where I would tell the bank president
162
00:08:44,149 --> 00:08:45,859
who we are and why we're here.
163
00:08:46,735 --> 00:08:48,404
-Oh, do I say that?
-Go for it. Please do.
164
00:08:48,487 --> 00:08:51,699
Okay. Uh… Sir, I hate to tell you this,
165
00:08:51,782 --> 00:08:55,911
but we're here from the FDIC to… present
a formal letter that the bank has failed.
166
00:08:55,995 --> 00:09:00,165
Um, once the last customer has left
for the day, if you could lock the door,
167
00:09:00,249 --> 00:09:03,460
uh, and gather your employees
so we can make the announcement.
168
00:09:03,544 --> 00:09:04,837
-Okay.
-Did I do it right?
169
00:09:05,337 --> 00:09:06,505
-That was pretty good. Nor--
170
00:09:06,589 --> 00:09:07,506
It's all right.
171
00:09:07,590 --> 00:09:09,717
Normally, we wouldn't
say that the bank has failed.
172
00:09:09,800 --> 00:09:11,969
-Aah!
-We don't want to bring that up until
173
00:09:12,052 --> 00:09:13,762
-right at the last minute. Once the state
-I see.
174
00:09:13,846 --> 00:09:15,014
actually closes the the bank.
175
00:09:15,097 --> 00:09:17,850
Maybe he's thinking, "Maybe
it's an announcement for my birthday."
176
00:09:17,933 --> 00:09:19,560
-Yeah.
-Right?
177
00:09:19,643 --> 00:09:22,187
No, he's-- there's a pretty good
chance he knows why we're here.
178
00:09:22,271 --> 00:09:26,525
Team, can we all gather up? We've got
an announcement here this evening.
179
00:09:26,609 --> 00:09:28,611
Hello everyone, my name is Tyler Caviness,
180
00:09:28,694 --> 00:09:30,654
and I'm with the Federal
Deposit Insurance Corporation.
181
00:09:30,738 --> 00:09:33,407
It's nice to meet all of
you. As you've heard from the state,
182
00:09:33,490 --> 00:09:34,783
your bank has failed,
183
00:09:34,867 --> 00:09:37,286
and the FDIC has stepped in
to help handle the resolution.
184
00:09:37,369 --> 00:09:39,913
The good news is the FDIC
has entered into an agreement
185
00:09:39,997 --> 00:09:43,042
with an assuming
institution to acquire all the deposits
186
00:09:43,125 --> 00:09:45,586
and virtually all of
the assets of the institution.
187
00:09:45,669 --> 00:09:47,963
The bank will reopen Monday morning
188
00:09:48,047 --> 00:09:50,424
for business as usual,
just under a new name.
189
00:09:50,507 --> 00:09:52,551
There will be a lot of
work to accomplish together,
190
00:09:52,635 --> 00:09:54,762
and we are thankful for your cooperation.
191
00:09:54,845 --> 00:09:57,931
And now, I would like to
introduce you to the acquirer,
192
00:09:58,015 --> 00:10:00,392
the acquiring bank. Thank you.
193
00:10:04,438 --> 00:10:05,439
-How'd I do?
-That was a pretty good job.
194
00:10:05,522 --> 00:10:08,192
-Thank you.
-Did it feel awkward or, uh, unusual?
195
00:10:08,275 --> 00:10:09,818
It did feel a little awkward
196
00:10:09,902 --> 00:10:11,987
cause normally when
I'm speaking to a group of people,
197
00:10:12,071 --> 00:10:15,199
they laugh at the
end of a sentence, but in this case,
198
00:10:15,282 --> 00:10:17,284
there are a lot of worried faces.
199
00:10:17,368 --> 00:10:18,994
-Yeah.
-What is that like for you?
200
00:10:19,078 --> 00:10:20,537
You get used to knowing that we're there
201
00:10:20,621 --> 00:10:23,165
to make sure that they
understand exactly what's happened
202
00:10:23,248 --> 00:10:24,958
and, um, to kind of walk them through it.
203
00:10:25,042 --> 00:10:27,753
We've taken care of
all of this on the backend so
204
00:10:27,836 --> 00:10:29,088
that it's really a non-event.
205
00:10:29,171 --> 00:10:30,673
That's what we--
That's what we strive to do.
206
00:10:30,756 --> 00:10:33,384
A non-event.
Like if I'm a customer of this bank,
207
00:10:33,467 --> 00:10:38,097
and on Friday, Saturday,
Sunday, my debit card's still working.
208
00:10:38,180 --> 00:10:40,015
Sometime next week,
I get an email or a letter saying,
209
00:10:40,099 --> 00:10:42,476
"Hey, your bank has a new name,"
and I'm like, "Ehh who cares,
210
00:10:42,559 --> 00:10:44,186
a form letter from my-- Whatever."
211
00:10:44,269 --> 00:10:45,854
And my life just goes on.
212
00:10:45,938 --> 00:10:48,399
I don't experience any
disruption because you're there.
213
00:10:48,482 --> 00:10:50,317
-Yeah.
-Yeah. Amazing.
214
00:10:50,401 --> 00:10:51,318
Thank you so much Tyler.
215
00:10:51,402 --> 00:10:53,445
-Alright, have a good day.
-Thank you, you too.
216
00:10:55,906 --> 00:10:57,491
How incredible is this?
217
00:10:57,574 --> 00:10:58,742
Like, I don't know about you,
218
00:10:58,826 --> 00:11:02,955
I think this is one of the most
effective government programs of all time.
219
00:11:03,038 --> 00:11:08,335
The people at the FDIC have neutralized
the threat of bank failures so thoroughly,
220
00:11:08,419 --> 00:11:12,256
not only do they not hurt our money,
we don't even hear about them anymore.
221
00:11:12,840 --> 00:11:14,425
And if they didn't
create that level of trust,
222
00:11:14,508 --> 00:11:17,594
our economy would
literally cease to function.
223
00:11:17,678 --> 00:11:18,971
But hold on,
224
00:11:19,054 --> 00:11:22,724
bank failures are just one bad
thing that can happen to our money.
225
00:11:22,808 --> 00:11:24,351
What is the federal government doing
226
00:11:24,435 --> 00:11:28,772
to protect us from all the other
financial disasters that threaten us?
227
00:11:29,731 --> 00:11:33,485
You know, this show was
supposed to come out a year ago.
228
00:11:34,027 --> 00:11:37,406
But can you guess
what world-altering event happened
229
00:11:37,489 --> 00:11:39,908
a week after we opened our writers room?
230
00:11:39,992 --> 00:11:43,412
No, I'm not talking about the release
of Animal Crossing: New Horizons.
231
00:11:43,495 --> 00:11:46,457
Though that did also stop me
from working for over a year.
232
00:11:46,540 --> 00:11:48,667
No, Covid-19 hit.
233
00:11:48,750 --> 00:11:51,670
And like
so many businesses across the country,
234
00:11:51,753 --> 00:11:55,716
we were forced to shut down.
It was a frightening time.
235
00:11:55,799 --> 00:12:00,053
Millions of Americans were out of work,
the stock market had plummeted,
236
00:12:00,137 --> 00:12:02,764
and trillions of dollars
disappeared from the economy
237
00:12:02,848 --> 00:12:05,476
faster than Quibi
disappeared from our phones.
238
00:12:05,559 --> 00:12:09,229
Was a time when
everyone from gig workers to CEO's
239
00:12:09,313 --> 00:12:11,315
were looking to the government for help.
240
00:12:11,398 --> 00:12:13,066
So what did they do?
241
00:12:18,030 --> 00:12:22,367
They made it rain.
Trillions of dollars in unemployment,
242
00:12:22,451 --> 00:12:27,456
stimulus checks, small business loans,
and corporate tax breaks.
243
00:12:28,373 --> 00:12:32,669
This emergency infusion
of cash did stabilize the economy,
244
00:12:32,753 --> 00:12:36,048
but I found myself
watching CNBC wondering,
245
00:12:36,131 --> 00:12:39,718
"First of all, when do my Shark Tank
reruns start? This shit is boring."
246
00:12:39,801 --> 00:12:43,889
But more importantly, where is
all this bailout money coming from,
247
00:12:44,598 --> 00:12:49,311
and who's really benefitting? We the
people or the Mark Cubans of the world?
248
00:12:49,394 --> 00:12:53,106
Well, the answers to
those questions may astonish you.
249
00:13:04,535 --> 00:13:07,538
Folks, my name is
Penn Jillette, that's my partner Teller.
250
00:13:07,621 --> 00:13:12,125
And you may feel stunned, confused,
even bamboozled by government bailouts.
251
00:13:12,209 --> 00:13:14,545
But they have not fooled us.
252
00:13:14,628 --> 00:13:17,172
We're here to show
you how the magic works.
253
00:13:17,256 --> 00:13:20,342
Teller here will be playing
the part of the government,
254
00:13:20,425 --> 00:13:23,637
and these stacks of
good-old American greenbacks,
255
00:13:23,720 --> 00:13:26,181
they're the money
flowing through the economy.
256
00:13:26,265 --> 00:13:29,309
Happy people buying
groceries, taking out bank loans
257
00:13:29,393 --> 00:13:33,981
and betting it all on the ponies.
But hold those horses.
258
00:13:34,064 --> 00:13:36,567
When there's an
economic crash, people get scared.
259
00:13:37,150 --> 00:13:39,611
All that activity stops,
260
00:13:39,695 --> 00:13:44,533
and trillions of dollars
literally disappear from circulation.
261
00:13:44,616 --> 00:13:49,705
Oh, panic, calamity,
the wheels of finance grind to a halt.
262
00:13:49,788 --> 00:13:51,957
No one's buying Frappuccinos
263
00:13:52,040 --> 00:13:55,586
and Ford F-150s anymore.
264
00:13:55,669 --> 00:13:59,298
To save capitalism,
the government needs to inject cash
265
00:13:59,381 --> 00:14:02,426
into the system
to get the economy flowing again.
266
00:14:02,509 --> 00:14:06,096
So we need a volunteer
to fork some cash over.
267
00:14:06,179 --> 00:14:07,639
Don't be stingy.
268
00:14:07,723 --> 00:14:10,517
You can afford to see us
so we know you're rolling in it.
269
00:14:10,601 --> 00:14:14,563
Oh! Oh! Me! Me!
Ha-hah, me, me, take my money.
270
00:14:15,063 --> 00:14:17,149
Okay, Mr. Moneybags,
since you're so loaded,
271
00:14:17,232 --> 00:14:19,735
why don't you be the bank?
272
00:14:19,818 --> 00:14:22,029
And Teller here, is the US Treasury.
273
00:14:22,112 --> 00:14:25,699
Now Uncle Sam needs 2.2 trillion dollars
274
00:14:25,782 --> 00:14:27,993
to stimulate the economy.
275
00:14:28,076 --> 00:14:31,455
So he does what he does
anytime he needs to spend money.
276
00:14:31,538 --> 00:14:37,210
He borrows it, from investors,
other countries, and from you, the bank.
277
00:14:37,294 --> 00:14:40,213
-Wow! That's quite a wad you got there.
278
00:14:40,297 --> 00:14:41,882
You overcompensating for something?
279
00:14:41,965 --> 00:14:43,884
No, don't answer that, don't answer that.
280
00:14:43,967 --> 00:14:49,139
The government takes that borrowed
money and spends it on unemployment,
281
00:14:49,222 --> 00:14:54,519
bailouts and other stimulus
to get the economy moving again.
282
00:14:54,603 --> 00:14:57,606
In return, the bank gets a treasury bond,
283
00:14:57,689 --> 00:15:02,152
which is just a fancy,
bullshit way to say, "I owe you."
284
00:15:02,235 --> 00:15:06,365
It is the same thing with other banks
and companies going deeper into debt
285
00:15:06,448 --> 00:15:08,075
than a college graduate.
286
00:15:08,158 --> 00:15:12,704
Who else wants to loan
Uncle Sam a couple 100 billion?
287
00:15:12,788 --> 00:15:14,373
Why would everyone agree to this?
288
00:15:14,456 --> 00:15:16,667
Oh, they always do.
289
00:15:16,750 --> 00:15:19,252
Companies and other countries
are eager to loan our government money
290
00:15:19,336 --> 00:15:21,713
because we're a super power.
291
00:15:21,797 --> 00:15:24,758
The biggest, baddest
motherfucker in the world!
292
00:15:25,384 --> 00:15:27,302
And that makes us a uh… safe bet.
293
00:15:27,386 --> 00:15:30,097
The US government's
kinda like the Lannisters,
294
00:15:30,180 --> 00:15:32,432
we always pay our debts,
295
00:15:32,516 --> 00:15:35,018
and start a lot of needless wars.
296
00:15:36,645 --> 00:15:39,690
Okay, look, I know the
government borrows all the time,
297
00:15:39,773 --> 00:15:42,901
but in a crisis, we're
borrowing so much all at once.
298
00:15:42,985 --> 00:15:47,072
I mean two trillion in debt
on top of what we usually spend?
299
00:15:47,155 --> 00:15:48,115
Doesn't it seem crazy?
300
00:15:48,198 --> 00:15:51,535
That's why we have one
more trick up our sleeve
301
00:15:51,618 --> 00:15:54,496
just in case the banks get nervous.
302
00:15:54,579 --> 00:15:59,042
It's called, "The Fed." Now,
if you remember, we gave all of you banks
303
00:15:59,793 --> 00:16:02,671
a whole bunch of
Treasury bonds as IOUs, right?
304
00:16:02,754 --> 00:16:04,881
Why don't you, uh, check those out now?
305
00:16:07,426 --> 00:16:08,510
What?!
306
00:16:08,593 --> 00:16:12,681
Yeah. The government
has repaid all your IOUs.
307
00:16:12,764 --> 00:16:16,143
Now you can make home
loans, invest in businesses
308
00:16:16,226 --> 00:16:19,187
and give your executives
some big fat bonuses.
309
00:16:19,271 --> 00:16:21,857
But where did all this money come from?
310
00:16:21,940 --> 00:16:24,484
Ah-hah. Well, it wouldn't
be a Penn and Teller show
311
00:16:24,568 --> 00:16:27,320
if we didn't reveal how the trick is done.
312
00:16:27,404 --> 00:16:29,406
The government's Federal Reserve Bank
313
00:16:29,489 --> 00:16:32,284
simply types a couple
of numbers into a computer
314
00:16:32,367 --> 00:16:35,495
and adds some zeros to the bank's balance.
315
00:16:37,914 --> 00:16:40,542
What? So they create money out of nothing?
316
00:16:40,625 --> 00:16:43,670
That's right.
The federal government literally
317
00:16:43,754 --> 00:16:47,758
controls how much money
there is, which gives it alone,
318
00:16:47,841 --> 00:16:51,219
the power to bail
the economy out in a crisis.
319
00:16:51,303 --> 00:16:53,930
And it only works because
the banks trust the government
320
00:16:54,014 --> 00:16:55,932
to always pay back its debts.
321
00:16:56,016 --> 00:16:57,726
Okay, that's amazing. But I--
322
00:16:57,809 --> 00:16:59,478
No, no, no. That's all.
323
00:16:59,561 --> 00:17:02,105
My name is Penn Jillette
with partner, Teller, we're Penn & Teller.
324
00:17:02,189 --> 00:17:06,318
Whoever the hell you are,
get off our stage. Get off our stage!
325
00:17:07,027 --> 00:17:10,155
Okay, hold up. Cool magic trick, but
326
00:17:10,238 --> 00:17:12,616
what happens if you're not a bank?
327
00:17:12,699 --> 00:17:14,910
Like yeah,
the big billionaires on Wall Street
328
00:17:14,993 --> 00:17:17,496
trust that the government
has their backs in a crisis, but
329
00:17:17,579 --> 00:17:21,208
can the average American
trust the government to bail us out
330
00:17:21,291 --> 00:17:22,709
when the cash hits the fan?
331
00:17:22,793 --> 00:17:24,086
Hey, Adam.
332
00:17:24,169 --> 00:17:27,422
Hey Sandra. Hi Claudia.
Thank you so much for this.
333
00:17:27,506 --> 00:17:29,091
-No problem.
-This is so lovely back here.
334
00:17:29,174 --> 00:17:30,467
-Aww, thank you.
-Thanks.
335
00:17:30,550 --> 00:17:31,676
So what is all this stuff?
336
00:17:31,760 --> 00:17:36,223
So we had a daycare
that we had to close. This is
337
00:17:36,306 --> 00:17:40,102
the four of us. This is my
dad is here and, obvi-- me, Claudia.
338
00:17:40,185 --> 00:17:42,771
And then this is our brother
when we opened the school.
339
00:17:42,854 --> 00:17:44,773
-The grand opening.
-Yeah.
340
00:17:44,856 --> 00:17:46,983
Kay, wait, I have a question though,
cause I've always wondered this.
341
00:17:47,067 --> 00:17:49,736
For a grand opening,
where do you get the big scissors?
342
00:17:50,737 --> 00:17:53,406
Obviously, every business
had a lot of trouble during COVID.
343
00:17:53,490 --> 00:17:55,325
Tell me about what your story was.
344
00:17:55,408 --> 00:17:59,121
So we had
a capacity of 55 children, ages
345
00:17:59,204 --> 00:18:00,580
six weeks to five years old.
346
00:18:00,664 --> 00:18:03,166
Most of our parents were ER doctors,
347
00:18:03,250 --> 00:18:06,044
or they work frontlines
in the supermarket.
348
00:18:06,128 --> 00:18:08,547
You know,
we had children of essential workers.
349
00:18:08,630 --> 00:18:10,465
You're like essential
to the essential people.
350
00:18:10,549 --> 00:18:11,424
-Yeah, exactly.
-Exactly.
351
00:18:11,508 --> 00:18:13,885
And so we
were trying to figure out,
352
00:18:13,969 --> 00:18:17,180
can our employees come back?
Is it safe for us to come back?
353
00:18:17,264 --> 00:18:19,224
And I had staff that didn't come back. I
354
00:18:19,307 --> 00:18:21,935
had maybe four or five children come back.
355
00:18:22,018 --> 00:18:23,103
-It was just messy.
-Wow!
356
00:18:23,186 --> 00:18:26,982
So that sounds like that's
a rough situation for you financially.
357
00:18:27,065 --> 00:18:30,527
We were trying to make
a plan, to try and make it through, and…
358
00:18:30,610 --> 00:18:33,989
It was the anniversary
of our mother's passing,
359
00:18:34,072 --> 00:18:36,199
-which, it's already a dark day.
-Oh wow, yeah.
360
00:18:36,283 --> 00:18:39,494
And my sister called me,
she's like, "Look, I reran the numbers
361
00:18:40,162 --> 00:18:41,913
and it-- We can't,"
362
00:18:41,997 --> 00:18:44,416
you know, and we knew
that it was affecting
363
00:18:44,499 --> 00:18:46,084
not just us or my chil--
364
00:18:46,168 --> 00:18:47,961
-our children losing care.
-Our friends, yeah.
365
00:18:48,044 --> 00:18:50,797
This is employees
that are losing their income.
366
00:18:50,881 --> 00:18:53,800
But there were
a bunch of big bills signed.
367
00:18:53,884 --> 00:18:54,968
-Right?
-Right.
368
00:18:55,051 --> 00:18:57,846
And, like, a big part of
that was the PPP loans
369
00:18:57,929 --> 00:19:00,682
that were the paytech...
paycheck protection loans
370
00:19:00,765 --> 00:19:02,309
so that businesses like yourself,
371
00:19:02,392 --> 00:19:04,144
-would not have to lay off employees.
-Right!
372
00:19:04,227 --> 00:19:06,730
-Were you able to get one of those loans?
-We did, but it was
373
00:19:06,813 --> 00:19:07,898
six thousand dollars,
374
00:19:07,981 --> 00:19:10,358
-Okay.
-and that is what we got.
375
00:19:10,442 --> 00:19:11,693
-Period, that's it?
-Yeah.
376
00:19:11,776 --> 00:19:16,198
If you had six employees,
that's not even a month of wages.
377
00:19:16,281 --> 00:19:19,576
No, but the second and
third PPP loans, we were denied.
378
00:19:19,659 --> 00:19:21,953
-And that was-- I don't know.
-Why were you denied?
379
00:19:22,037 --> 00:19:23,914
-They never said! Yeah.
-Nope, they never said.
380
00:19:23,997 --> 00:19:24,831
Why do you think that is?
381
00:19:24,915 --> 00:19:29,085
Because we're just this
teeny tiny little school run by two women,
382
00:19:29,169 --> 00:19:32,297
-like, we're not shouting loud enough, so.
-Yeah.
383
00:19:32,380 --> 00:19:33,882
-That's really fucked up.
-Yeah.
384
00:19:33,965 --> 00:19:36,593
-Yes! I agree.
-I think so too!
385
00:19:36,676 --> 00:19:38,220
So is there
any way we could go see it?
386
00:19:38,303 --> 00:19:39,304
-Yes, of course.
-Yeah?
387
00:19:39,387 --> 00:19:43,141
I would love to stop by
and see the little yellow house again.
388
00:19:43,225 --> 00:19:44,893
Alright, this is the
first time I've been back.
389
00:19:44,976 --> 00:19:46,436
-Is it just over this wall?
-I haven't been-- Yeah.
390
00:19:46,519 --> 00:19:47,812
I don't have access to it actually.
391
00:19:47,896 --> 00:19:51,233
You know, maybe production can
help us out with a ladder or something?
392
00:19:51,316 --> 00:19:53,276
Awesome. Thank you, Kendall.
393
00:19:54,277 --> 00:19:56,780
-Oh my gosh, this is so cute.
394
00:19:56,863 --> 00:19:58,949
Aw, it looks so sad.
395
00:19:59,032 --> 00:20:02,953
Normally, my kids would be out
here playing, making a ruckus.
396
00:20:03,036 --> 00:20:08,375
Just had to take everything
or whatever I could take and go.
397
00:20:08,458 --> 00:20:10,502
The community really
needs a place like this
398
00:20:10,585 --> 00:20:14,172
with someone who takes care of it
as much and loves it as much as we do.
399
00:20:14,256 --> 00:20:17,717
Yeah. You're providing so
much support to the community,
400
00:20:17,801 --> 00:20:19,719
but then when the crisis comes,
401
00:20:19,803 --> 00:20:22,389
and the government's putting up
this big safety net for everybody,
402
00:20:22,472 --> 00:20:25,642
it's like the holes are too big
and you guys are too small,
403
00:20:25,725 --> 00:20:27,602
-and you fall through.
-Fell right through.
404
00:20:27,686 --> 00:20:28,812
If you could build a system
405
00:20:28,895 --> 00:20:31,147
that would have supported
you the way you needed,
406
00:20:31,231 --> 00:20:32,732
what would it have looked like?
407
00:20:32,816 --> 00:20:35,735
To me, it would just be
somehow having a voice.
408
00:20:35,819 --> 00:20:37,696
Or hav… having someone you can call.
409
00:20:37,779 --> 00:20:40,198
-Having a teeny business administration
-Yes, definitely.
410
00:20:40,282 --> 00:20:41,866
-that is there to serve you.
-Right.
411
00:20:41,950 --> 00:20:43,576
A teeny business, I would say that!
412
00:20:43,660 --> 00:20:47,580
Sandra, thank you so much for telling
me your story. I can't thank you enough.
413
00:20:47,664 --> 00:20:51,084
Thank you for having me and
letting me share my teeny tiny business.
414
00:20:51,167 --> 00:20:52,210
Yeah. Can I give you a hug?
415
00:20:52,294 --> 00:20:54,296
-Of course! Thank you.
-Thank you so much.
416
00:20:54,379 --> 00:20:56,006
-Alright.
-Alright. Bye.
417
00:21:03,847 --> 00:21:08,560
Sandra's story makes me
so angry, and she's not alone.
418
00:21:08,643 --> 00:21:10,478
How many of you know a Sandra?
419
00:21:10,562 --> 00:21:13,023
Hell, how many of you were a Sandra?
420
00:21:13,106 --> 00:21:16,401
Waiting for a lifeline
that just never came?
421
00:21:17,110 --> 00:21:22,490
How is it possible that our government
can make money rain down from the heavens,
422
00:21:22,574 --> 00:21:25,994
yet if it fails time and again
to make sure any ends up
423
00:21:26,077 --> 00:21:29,122
in the hands of the
people who need it the most.
424
00:21:30,332 --> 00:21:35,670
Well, we looked into it and the answer
isn't going to make you less angry.
425
00:21:35,754 --> 00:21:39,674
See, in this country,
we have two radically different systems
426
00:21:39,758 --> 00:21:41,968
for distributing federal bailout money,
427
00:21:42,052 --> 00:21:45,013
one for the rich,
and one for everybody else.
428
00:21:45,096 --> 00:21:49,434
Banks and large corporations have a
direct, efficient line to government cash.
429
00:21:49,517 --> 00:21:52,812
For them,
it's kind of like flying first class.
430
00:21:52,896 --> 00:21:55,106
Ugh, this recession is such a downer,
431
00:21:55,190 --> 00:21:57,233
I need a ticket to Money Town right away.
432
00:21:57,317 --> 00:21:59,194
Of course, how will you be paying?
433
00:21:59,277 --> 00:22:00,987
I just issued these bonds.
434
00:22:02,530 --> 00:22:06,159
Which as you know, is a fancy,
bullshit way to say, "I owe you."
435
00:22:08,244 --> 00:22:09,996
Very good, sir.
436
00:22:10,080 --> 00:22:13,333
We at the Federal Reserve
would love to buy these from you.
437
00:22:13,416 --> 00:22:15,377
One ticket to Money Town.
438
00:22:15,460 --> 00:22:19,005
And please enjoy our
complimentary low-interest rosé.
439
00:22:19,089 --> 00:22:21,174
We hope to bail you out again soon.
440
00:22:21,257 --> 00:22:22,175
Ta.
441
00:22:22,258 --> 00:22:24,469
But the rest of us can't issue bonds,
442
00:22:24,552 --> 00:22:27,263
so we don't have
access to that kind of help.
443
00:22:27,347 --> 00:22:30,141
Instead, we're stuck in economy.
444
00:22:30,225 --> 00:22:33,728
My restaurant has been
really struggling since the shutdown.
445
00:22:33,812 --> 00:22:35,772
Can I please have a ticket to Money Town?
446
00:22:35,855 --> 00:22:38,149
I don't know, can you issue any bonds?
447
00:22:38,233 --> 00:22:40,693
No, I…I… What is that?
448
00:22:40,777 --> 00:22:42,237
I'm afraid you'll have to wait over there.
449
00:22:42,320 --> 00:22:47,200
Actually, economy's too nice. It's more
like flying standby on Christmas Eve.
450
00:22:48,660 --> 00:22:52,789
The federal agency that distributed
COVID-19 relief funds to small businesses
451
00:22:52,872 --> 00:22:55,125
is called the
Small Business Administration.
452
00:22:55,208 --> 00:22:57,460
But they themselves are so small,
453
00:22:57,544 --> 00:23:00,672
they had to outsource
their job to the banks.
454
00:23:02,549 --> 00:23:03,508
Next!
455
00:23:03,591 --> 00:23:06,886
Please, I need to get to Money Town.
I have a family and ten employees.
456
00:23:06,970 --> 00:23:10,390
Oh, certainly, certainly.
Just get in line, I'll be happy to help.
457
00:23:10,473 --> 00:23:12,016
Just as soon as I get my cut.
458
00:23:12,517 --> 00:23:16,396
That's real. During the
SBA's COVID-19 loan program,
459
00:23:16,479 --> 00:23:20,358
banks were actually allowed to
make a percentage off of each loan,
460
00:23:20,441 --> 00:23:23,194
and a loophole in the
bill allowed even big businesses
461
00:23:23,278 --> 00:23:25,530
like restaurant chains, to qualify.
462
00:23:25,613 --> 00:23:29,409
Here's a loan for you,
Mr. PF Chang, and one for you, Ruth's,
463
00:23:29,492 --> 00:23:31,411
and for your friend, Chris.
464
00:23:31,494 --> 00:23:33,872
Hope your little
steakhouse empire survives.
465
00:23:36,040 --> 00:23:37,709
What the hell?!
466
00:23:37,792 --> 00:23:39,544
Oh, we just realized
we could make more money
467
00:23:39,627 --> 00:23:41,838
by giving a few
big loans to big businesses
468
00:23:41,921 --> 00:23:44,591
as opposed to many
small loans to smaller businesses.
469
00:23:44,674 --> 00:23:47,051
So that's what we're going with. Next!
470
00:23:47,135 --> 00:23:51,097
And that might explain
why in most large cities,
471
00:23:51,181 --> 00:23:53,183
businesses in predominantly white areas
472
00:23:53,266 --> 00:23:57,353
received loans at far higher rates
than those in communities of color.
473
00:23:58,229 --> 00:24:02,483
But you know, for all the attention that
small businesses got during the pandemic,
474
00:24:03,067 --> 00:24:06,487
you know who really
got screwed? Individual workers.
475
00:24:06,571 --> 00:24:09,991
Because their aid was doled out
through the unemployment system,
476
00:24:10,074 --> 00:24:14,287
and that's more like…
the worst bus trip you've ever been on.
477
00:24:18,625 --> 00:24:21,044
If you've ever been on
Unemployment in America,
478
00:24:21,127 --> 00:24:24,130
you don't need me
to tell you it is fucked up.
479
00:24:24,214 --> 00:24:28,635
It's a rickety, patchwork program
that every state manages differently.
480
00:24:28,718 --> 00:24:32,764
And many of them have underfunded
their unemployment systems for years.
481
00:24:32,847 --> 00:24:34,307
Okay dearies,
482
00:24:34,390 --> 00:24:36,559
I don't have a ton
of help back here today,
483
00:24:36,643 --> 00:24:40,313
so it's just gonna be slow, I'm
gonna have to get to you one at a time.
484
00:24:40,396 --> 00:24:43,274
-Now, who was here first?
485
00:24:43,358 --> 00:24:47,403
So when an unprecedented
wave of joblessness hit in 2020,
486
00:24:47,487 --> 00:24:49,989
the system didn't have
nearly enough capacity
487
00:24:50,073 --> 00:24:52,492
to process the tsunami of claims.
488
00:24:52,575 --> 00:24:55,703
Oh, dagnabit!
489
00:24:55,787 --> 00:24:58,998
They don't give me a pencil sharpener,
so I've got to just whittle by hand.
490
00:24:59,082 --> 00:25:02,460
That's why just filing for
unemployment during the pandemic
491
00:25:02,543 --> 00:25:04,879
was a bureaucratic nightmare.
492
00:25:04,963 --> 00:25:08,216
Americans in need
were kept on hold for hours
493
00:25:08,299 --> 00:25:11,052
and forced to wait
months before relief came.
494
00:25:11,886 --> 00:25:16,182
While the biggest businesses
in America were relaxing in first-class.
495
00:25:16,266 --> 00:25:20,561
I can't believe
I'm tired, I slept so much on the plane.
496
00:25:26,150 --> 00:25:28,611
You know, when COVID-19 shut us down,
497
00:25:28,695 --> 00:25:32,198
my production company
got a PPP loan just like Sandra,
498
00:25:32,282 --> 00:25:36,953
but even though our work is definitely not
as essential, Sandra takes care of kids.
499
00:25:37,036 --> 00:25:39,122
I'm up here doing pen jokes.
500
00:25:39,205 --> 00:25:42,250
We got more help more quickly than she did
501
00:25:42,333 --> 00:25:45,878
just because we have
a fancier accountant at a bigger bank.
502
00:25:45,962 --> 00:25:48,840
I had more, so I got more.
503
00:25:49,549 --> 00:25:52,051
That is facedown-ass-up-backwards.
504
00:25:52,135 --> 00:25:54,971
But our entire system is rigged that way.
505
00:25:55,054 --> 00:25:58,891
Is it any wonder that so many
Americans have stopped trusting it?
506
00:25:59,726 --> 00:26:02,729
Oh, uh, Lemonade Kid, what happened?
507
00:26:02,812 --> 00:26:06,566
I'm getting out of the game
old-timer. Never got my PPP loan
508
00:26:06,649 --> 00:26:09,485
and, nobody wants to spend
their stimulus on lemonade.
509
00:26:09,569 --> 00:26:13,239
Guess I'll work for Amazon
and get paid in gift cards.
510
00:26:14,407 --> 00:26:16,701
Lemonade Kid, no.
511
00:26:18,161 --> 00:26:22,957
Our financial system
and our government depend on our trust.
512
00:26:23,041 --> 00:26:25,793
If we don't trust that
our money is safe in the bank,
513
00:26:25,877 --> 00:26:30,131
if we don't trust that the government
will have our backs in a crisis,
514
00:26:30,214 --> 00:26:34,927
if we don't trust that this piece of ink
and paper is actually worth a dollar,
515
00:26:35,511 --> 00:26:36,721
it collapses.
516
00:26:37,221 --> 00:26:38,639
And that's what we risk
517
00:26:38,723 --> 00:26:42,185
when our government
fails to live up to its promises.
518
00:26:42,268 --> 00:26:46,189
It turns out that
our economy and our government
519
00:26:46,272 --> 00:26:47,815
is a lot like Tinkerbell.
520
00:26:48,566 --> 00:26:51,611
If we don't believe in it, it drops dead.
521
00:26:56,032 --> 00:26:58,618
But it doesn't have to.
522
00:26:58,701 --> 00:27:01,037
A better system is possible,
523
00:27:01,120 --> 00:27:04,290
and our government
can create one if it tries.
524
00:27:04,374 --> 00:27:07,919
I mean, these are the
same people who founded the FDIC,
525
00:27:08,002 --> 00:27:10,505
who predict the paths of hurricanes…
526
00:27:11,506 --> 00:27:14,634
…who sent a man to the Moon.
527
00:27:16,511 --> 00:27:18,346
You know speaking of which…