Speaker 1: Alex cladd Seine, Thanks for sitting down.
Speaker 2: It's my pleasure. Yeah, I love.
Speaker 1: Talking to you. I think what you're doing, I mean,
Speaker 1: your your mission is the most important mission. Right at
Speaker 1: the end of the day. It's about freedom, baby, Freedom,
Speaker 1: Freedom go up, Freedom go up. That should be the
Speaker 1: goal human flourishment.
Speaker 2: Well, it's not possible without en GU, but I do
Speaker 2: think FGU is the goal. NG is the way we
Speaker 2: get there.
Speaker 1: Number going up is the way to get freedom to
Speaker 1: go up.
Speaker 2: I mean, if bitcoin was a dollar forever, I don't
Speaker 2: I don't think we'd have the possibility to change the world.
Speaker 1: Is that because we wouldn't have as much adoption.
Speaker 2: I think that if you only had a limited value
Speaker 2: to bitcoin, it would not be able to replace the
Speaker 2: fiat system. It wouldn't be able to replace the functions
Speaker 2: of money. It wouldn't be able to replace central banking
Speaker 2: because if.
Speaker 1: The value wasn't high enough, then the small units wouldn't
Speaker 1: be enough to transact.
Speaker 2: That like core dynamic of bitcoin that's so unique and
Speaker 2: interesting is the fact that it turns self interest or
Speaker 2: greed basically into freedom. And I think if you had
Speaker 2: like a fixed value that was low in purchasing power,
Speaker 2: and it didn't have potential to increase this incentive wouldn't exist. Like, basically,
Speaker 2: if it was stuck in its early days forever, it
Speaker 2: would be a niche project that a bunch of US
Speaker 2: cipherpunks and freedom fighters and human rights activists would find interesting,
Speaker 2: but the average person would have no real Yeah, it
Speaker 2: would be kind of like PGP, right, like PGP works well,
Speaker 2: has not been hacked by the government, but it's kind
Speaker 2: of a pain to use, and it didn't really attract
Speaker 2: a massive audience even though it existed for fifteen twenty years.
Speaker 2: It wasn't until they could actually package into that to
Speaker 2: kind of technology, into things like signal that it became widespread.
Speaker 2: So I think that if you don't have NGU, your
Speaker 2: capacity for FGU would would remain like deminimous. It would
Speaker 2: be pretty minimal. I mean, it would still be cool
Speaker 2: and useful, but it would be more like manarrow. I mean,
Speaker 2: it would be a system that would probably run out
Speaker 2: of steam. The decentralization wouldn't be as strong. There wouldn't
Speaker 2: be as an incentive for enough people to run their
Speaker 2: own nodes. There wouldn't be as big of incentive for
Speaker 2: the miners like none of it works without NGU, but
Speaker 2: it's not. But I think the NGU is the is,
Speaker 2: the means, the end is FGU. That's that's my vision
Speaker 2: of it. At least.
Speaker 1: I write a weekly Bitcoin news email newsletter and at
Speaker 1: the top I have a quote on there and it
Speaker 1: says that bitcoin is the great bait and switch. Yeah,
Speaker 1: it pulls you in for the n GU and it
Speaker 1: switches you into the.
Speaker 2: You know, I mean, yeah, what's that quote from Neval.
Speaker 2: It's like like a like a like it's like a
Speaker 2: freedom tool dressed up as a get rich quicks game
Speaker 2: or something something like that, right, and you know.
Speaker 1: It's a bait and switch. We come for the n GU.
Speaker 2: No, and after tiers in a bear market, I think
Speaker 2: it's fair to question, you know, that part of it
Speaker 2: diminishes during a bear market. But ultimately I always say
Speaker 2: price is the greatest teacher. We can do all the
Speaker 2: work we can about bitcoin education, and a lot of
Speaker 2: great work it's done in bear markets. Like trust me,
Speaker 2: there's amazing stuff happening, but there is no replacement for
Speaker 2: the massive amount of interests that flows into bitcoin when
Speaker 2: there's a bull market. Isn't And this is because of
Speaker 2: ngu like there's self interest. The cool part is due
Speaker 2: to Bitcoin's incentive mechanism, the self interest translates to more
Speaker 2: freedom for everybody else. This is usually not the case
Speaker 2: for things like It just doesn't really work like that.
Speaker 2: So even capitalism like a whole at a global level
Speaker 2: has been totally corrupted and doesn't really work like this,
Speaker 2: Like more riches and property rights and resources for Americans
Speaker 2: directly is the result of impoverishing poor people in another
Speaker 2: country in the current global capitalist scheme. Bitcoin doesn't work
Speaker 2: like that. It's much more kind of open and neutral,
Speaker 2: which is why I'm so excited about it.
Speaker 1: Yeah, you know, I was thinking when we came down
Speaker 1: into this bear market from our sixty nine thousand pig
Speaker 1: to whatever you know, fifteen twenty thousand. But just like Facebook,
Speaker 1: stock also was down seventy five percent, but the Facebook,
Speaker 1: their network still worked the same way. Even though stock
Speaker 1: went down and the price of bitcoin dropped from seventy
Speaker 1: to twenty, but the bitcoin network was still resistant.
Speaker 2: Yeah, but like, think about a country like page like like.
Speaker 1: But for new adoption, like it would work for people
Speaker 1: in North Korea. They could still keep their money and
Speaker 1: transact it, but it wouldn't attract to your.
Speaker 2: Point, what's the name of the company where people have
Speaker 2: like a gym in their house, a Peloton? Oh yeah,
Speaker 2: so maybe for Facebook now, but but long run, it's
Speaker 2: sort of more like Peloton. Like if Peloton stock drops
Speaker 2: ninety percent, like they're going to go under. Yeah, Like,
Speaker 2: so it presents a terminal risk to the system. Yeah.
Speaker 2: Like like if bitcoin, if the price of bitcoin dropped
Speaker 2: ninety nine point nine percent tomorrow never recovered, it would die. Sure, Okay,
Speaker 2: so we know it's not going to do at but
Speaker 2: like that's why it can survive, That's why it can
Speaker 2: bring freedom to more people, is because of the incentives
Speaker 2: at play.
Speaker 1: Yeah, I want to talk about what you just said.
Speaker 1: It was kind of something I've been thinking about when
Speaker 1: I listen to your talk yesterday, which I liked. But
Speaker 1: you just said that kind of capitalism has been perverted
Speaker 1: in such a way that American kind of has built
Speaker 1: wealth while impoverishing other nations. Yes, and so that's certainly
Speaker 1: part of your work I want to talk about with
Speaker 1: IMF and kind of the new book that you're talking
Speaker 1: about with the Hidden Repression is the new book. So
Speaker 1: your books are great I look forward to them. So anyway,
Speaker 1: for everyone listening, check out that Hidden Repression new book
Speaker 1: and the way that the financial system has been set up.
Speaker 1: It's set up in a way, and you broke it
Speaker 1: down brilliantly, and I want you to kind of break
Speaker 1: that down for us again. How these nations are forced
Speaker 1: to only provide goods that the US wants in the
Speaker 1: dollars and they can't do what's best for them, and
Speaker 1: so that's kind of a way that it impoverishes them.
Speaker 1: But if we started just from a higher level, and
Speaker 1: if it wasn't for corrupt money, because goods and services
Speaker 1: so much cheaper those other nations, they don't have much
Speaker 1: going on there. By taking jobs, whether that be manufacturing
Speaker 1: jobs or technical jobs, even though we're paying them a
Speaker 1: very low wage, it's a good wage for that area,
Speaker 1: wouldn't that actually be taking prosperity there? But it's the
Speaker 1: financial stem that then turns that around. And actually, yeah, so.
Speaker 2: If we had a neutral monetary language for the world
Speaker 2: that was consistent, I think there would be much more
Speaker 2: equal exchange is what you call it in international economics,
Speaker 2: unequal exchange. You have equal exchange. I think if the
Speaker 2: monetary system wasn't corrupted. Then you'd get much closer to
Speaker 2: the ideal of how people like John Locke thought of
Speaker 2: international trade, where like your country would build what you're
Speaker 2: good at, and then you could exchange that for other
Speaker 2: things you're not good at. That is not how it works.
Speaker 2: Like the United States aggressively subsidizes things that we really
Speaker 2: shouldn't be making and crowds out the ability of other
Speaker 2: nations to do those things. It is not a free
Speaker 2: market at all. It's completely controlled. I mean, it's like
Speaker 2: the bond market, or like the stock market in Japan.
Speaker 2: The stock market in Japan can't be considered a capitalist
Speaker 2: if the government owns fifty percent of right. The bond
Speaker 2: marketing United States cannot be considered capitalist if the government
Speaker 2: bought trillions of dollars of bonds to backstop it. I mean,
Speaker 2: it could be considered a hybrid capitalist. I love what
Speaker 2: you said, but it can't be fully capitalist.
Speaker 1: Because because capitalism requires free.
Speaker 2: In voluntary stut that being said, we have to then,
Speaker 2: on the other hand, empathize with I think like people
Speaker 2: around the world when over the last seventy years they
Speaker 2: saw a battle between the communist Soviet Union and the
Speaker 2: capitalist the United States. Right, So even though you and
Speaker 2: I know that you know this is not capitalism, I
Speaker 2: can't fault them for calling the system capitalism. I mean,
Speaker 2: these are just semantics, but semantics are important. So the
Speaker 2: system that people get angry with that they call capitalism
Speaker 2: is very is a very corrupted form of capitalism in
Speaker 2: my view. But it does raise the question to the
Speaker 2: point that it's not even capital right, But of course
Speaker 2: it's the not true Scotsman thing. It's like, this is
Speaker 2: our lived experience. We don't have another we don't have
Speaker 2: a counterfactual. We only have what we have. Can market
Speaker 2: democracies thrive without exploiting other countries. We don't know the
Speaker 2: answer to that, because there is no world where that happens.
Speaker 2: My belief is if we can adjust the monetary system,
Speaker 2: that it's possible, because then all of a sudden, people
Speaker 2: are earning I mean, you have this arbitrage thing where
Speaker 2: like all of a sudden, if people are earning bitcoin
Speaker 2: here and they're earning bitcoin here, like it kind of
Speaker 2: like tightens up a lot faster, Like if you're earning
Speaker 2: naira and then you're earning dollars, and these markets can
Speaker 2: be divided and you can squeeze one and not the other.
Speaker 2: This allows for wage deflation, Like it's all about achieving
Speaker 2: wage deflation in some places to protect wages in other places,
Speaker 2: and to produce inflation in other places. And if you
Speaker 2: have two hundred currencies, it's very doable. Of one currency,
Speaker 2: I think it's much harder. Of course, we're speculating, but
Speaker 2: I know you and I both know that individuals are
Speaker 2: escaping the system through bitcoin, right, so we know that
Speaker 2: individuals can escape. Well, then of course the next question is, well,
Speaker 2: can entire systems escape? We don't know, but it's certainly
Speaker 2: worth discussing.
Speaker 1: So let's back it up and your book Hidden Repression.
Speaker 1: So there's this hidden mechanism, this hidden force that causes
Speaker 1: this repression. And I think the way that you frames
Speaker 1: up is it really starts with the IMF and the
Speaker 1: World Bank. And now I'd like for you to kind
Speaker 1: of break down how the IMF and the World Bank
Speaker 1: does this. But before we do, you know, I find
Speaker 1: to have this chart that it's kind of like an
Speaker 1: org chart of the world, and it kind of puts
Speaker 1: the BIS at the top, then like the IMF kind
Speaker 1: of World Bank below that. But now it seems like
Speaker 1: over the last couple of years the central banks have
Speaker 1: started to kind of break out past World Bank. But
Speaker 1: we'll talk about that later, but frame up for us
Speaker 1: the picture of the IMF and how they use this
Speaker 1: hidden repression.
Speaker 2: Look, the international monetary system is vast and complicated and
Speaker 2: has a lot of actors in it. I focus on
Speaker 2: the IMFM World Bank because they are arguably the two
Speaker 2: most important financial institutions in the world, certainly between nineteen
Speaker 2: sixty and the nineteen nineties and probably still today.
Speaker 1: Yeah, but probably still.
Speaker 2: I mean, when the United States and his allies gathered
Speaker 2: in New Hampshire in forty four, when they knew they
Speaker 2: were going to win World War two, they got together
Speaker 2: to think about what's the new monetary system going to
Speaker 2: look like, and how can we prevent the nineteen thirties
Speaker 2: from happening again. They didn't want to break down in
Speaker 2: global trade. They didn't want autarchy. They wanted the spice
Speaker 2: to flow. They wanted everything to be flowing. Okay, so
Speaker 2: with the new currency that the US set up that
Speaker 2: the rest of the world didn't want. By the way,
Speaker 2: the rest of the world wanted a more sort of
Speaker 2: democratic system, but we had the most gold, so we
Speaker 2: got to have our say, and we said, no, it's
Speaker 2: going to be you're all going to use dollars and
Speaker 2: you're going to redeem them at thirty five dollars an ounce.
Speaker 2: So in that system, there were pegged exchange rates, so
Speaker 2: you know, your currency was allowed to fluctuate within a band, right,
Speaker 2: and the IMF was set up as a lender of
Speaker 2: last resort to basically be like a stabilization fund for currencies.
Speaker 2: So if a currency started to like move out of
Speaker 2: that band, the IMF would would go over there and
Speaker 2: put that fire out. And you know what, that wasn't
Speaker 2: like a necessarily a bad idea. I mean, we were
Speaker 2: basically still on a sound money standard or version of it, right,
Speaker 2: because gold was still underlying the dollar. You could redeem
Speaker 2: it for a certain rate and that rate was controlled. Now,
Speaker 2: eventually that proved to be pretty quickly, quickly untenable. Like
Speaker 2: that lasted about twenty five years, and really, I mean
Speaker 2: it really it never.
Speaker 1: Really even worked well by fifty eight.
Speaker 2: Between forty four and fifty eight, there were tons of
Speaker 2: exchange controls, so it wasn't even really working. But like
Speaker 2: between fifty eight and seventy one. You know, we basically
Speaker 2: had this like Bretonwood System will say, but you know,
Speaker 2: after about twelve thirteen years, it put nixcent took us off.
Speaker 2: But the point is, at the beginning it was designed
Speaker 2: to be like an exchange rate stabilizer to keep trade going. Again,
Speaker 2: if a country had a balance of payments crisis and
Speaker 2: it was not exporting enough to sustain itself, it could borrow, okay,
Speaker 2: and then hopefully the idea would be within a few
Speaker 2: years they could fix the problem and then pay it back.
Speaker 2: That was the idea. Not necessarily against that idea. World
Speaker 2: Bank was designed to provide infrastructure funding in places where
Speaker 2: private capital just didn't have the appetite. So this is
Speaker 2: where we were talking war torn Europe in Japan. Again,
Speaker 2: not necessarily opposed to that. I think these things can
Speaker 2: exist in a sound money standard. You could have an
Speaker 2: international lender of last resort, you could have a Global
Speaker 2: Development Bank.
Speaker 1: They can give them the benefit of the doubt. Most
Speaker 1: of these things start out with good intention.
Speaker 2: Yeah, and like I don't know if they were I mean,
Speaker 2: they certainly were imperial intent. I mean they were intentions
Speaker 2: to keep the United States and its allies on top.
Speaker 2: But they weren't necessarily like in any sense in moral
Speaker 2: they made sense. But what ends up happening is Nixon
Speaker 2: takes us off gold standard and we're no longer on
Speaker 2: pegged exchange rates. So a lot of economists at the
Speaker 2: time said, well, why do we need the IMF. And
Speaker 2: what happened was the IMF essentially pivot did as did
Speaker 2: the bank. They pivoted away from stabilizing exchange rates and
Speaker 2: providing funding for infrastructure in what we now call industrial
Speaker 2: economies rich countries to providing credit to the impoverished parts
Speaker 2: of the world, to the developing world, to the third world,
Speaker 2: whatever you want to call it, the global South. That
Speaker 2: pivot took place from like the early sixties through the
Speaker 2: mid seventies, and it almost was like a total pivot,
Speaker 2: like you really had such you had a massive amount
Speaker 2: of imfimal bank activity shift into the global South. Okay,
Speaker 2: so these institutions were now like doing something else, and
Speaker 2: like thesis of my book is essentially that what they
Speaker 2: ended up doing, whether it was conscious or not, was
Speaker 2: replicating the what's called the colonial drain. So the point
Speaker 2: of colonialism was to drain resources from other places to
Speaker 2: sustain the quality of life at home. So for British
Speaker 2: that meant like getting tea and petrol and oil and
Speaker 2: gold and timber and whatever at very very cheap rates
Speaker 2: by going in stealing it or exploiting it somewhere else
Speaker 2: with violence bringing it back home. Okay, that Spanish conquest
Speaker 2: of Latin America, like that, it's kind of been the
Speaker 2: way they I mean, you know poor you know, the
Speaker 2: strong exploit through the strong exploit the week. I mean,
Speaker 2: it's it's a history, it's a historical thing. It's always
Speaker 2: been that way, but like this is how it played out. Now,
Speaker 2: colonialism in this way became untenable in the twentieth century.
Speaker 2: I mean, it just became unacceptable for various reasons, and
Speaker 2: it basically died out by nineteen sixty. And that's known
Speaker 2: as like the end of colonialism is basically around nineteen sixty.
Speaker 1: So that military colonials, Yeah, that's what I'm saying.
Speaker 2: So now you had monetary colonialism. So like the dynamic though,
Speaker 2: like still wanted to exist, like these countries and economy
Speaker 2: still wanted to take advantage of these other countries. So
Speaker 2: what they ended up doing is replacing the sword with debt.
Speaker 2: So you placed the worship and the bayonet and the
Speaker 2: gun with debt. And now what was happening is through
Speaker 2: the IMF and World Bank, the rich creditor name could
Speaker 2: extend loans to poorer nations and in that way exploit
Speaker 2: and repress them. And it was just sort of sort
Speaker 2: of like this machine for harvesting resources, natural resources.
Speaker 1: To borrow is serve into the lender. So they kind of.
Speaker 2: Exactly so like you would harvest resources as much as
Speaker 2: possible without letting any trickle down to the surrounding society
Speaker 2: A or B. You would do agricultural engineering, so you
Speaker 2: would like change what these countries grow to focus on
Speaker 2: certain monoculture crops that that we want, and then that
Speaker 2: would prevent them from growing the food that they need
Speaker 2: so that they'd become dependent on us. So it was
Speaker 2: like sort of engineering dependency. So this is why Africa,
Speaker 2: for example, imports eighty five percent of its food, which
Speaker 2: is crazy. It should be totally self sustained, it should
Speaker 2: be an exporter of food like net. It's a net
Speaker 2: importer vastly, and that's because partially US foreign policy, you know,
Speaker 2: dictated it, like we wanted to have food sovereignty and
Speaker 2: to control food so that we could use it as
Speaker 2: a weapon, and we did this several times during the
Speaker 2: Cold War. We would basically turn off wheat or whatever
Speaker 2: to a country and starve it like to make it
Speaker 2: bend to our will. We did this in Bangladesh in
Speaker 2: the seventies. You can look it up. It's harrowing. So basically,
Speaker 2: you know, the IMF and World Bank kind of were
Speaker 2: very lucrative for the West in three main ways. I mean,
Speaker 2: a lot of libertarians especially would criticize the IMF and
Speaker 2: World Bank back in the nineties, and they would say
Speaker 2: it was wasteful, it's a waste of tax payer money.
Speaker 2: It was not a waste of tax payer of money.
Speaker 2: It was very effective at aiding America and its allies.
Speaker 2: And it does so in three main ways. Number one
Speaker 2: is the interest. So these are high interest rate loans
Speaker 2: that created really large flow. And as anyone who borrows knows,
Speaker 2: eventually you have to pay back more than the principle.
Speaker 2: So you had all these dictators borrowing one hundred million,
Speaker 2: five hundred million, a billion dollars. Those countries winded up
Speaker 2: paying back to US five million, a billion, a billion
Speaker 2: a half dollars over the lifetime of the loan plus interest. Right,
Speaker 2: so you have like earnings coming in and you have
Speaker 2: a flow coming in based off interest. And again these
Speaker 2: were back then pretty high interest rate loans, payday loans,
Speaker 2: the predatory lending basically. So that's that's like, and the
Speaker 2: IMF and the World Bank and all of the little
Speaker 2: arms make billions of dollars a year doing this. That
Speaker 2: sort of sustains them. The second thing, though, is the
Speaker 2: resources and the labor. So as of twenty fifteen, there's
Speaker 2: one study that indicated that the industrial countries, the rich countries,
Speaker 2: we got about half of our resources and thirty percent
Speaker 2: or so, about a third of our labor from the
Speaker 2: global South. Now, let's just think about a world where
Speaker 2: that ended tomorrow. So let's say tomorrow, all of a sudden,
Speaker 2: we had half the resources and we we were missing
Speaker 2: the cheapest one third of our labor. Like on the
Speaker 2: spectrum of labor, what would happen. We'd have massifulation because
Speaker 2: we'd have shortages of goods. We'd have way less goods,
Speaker 2: and like we wouldn't have enough to go around, and
Speaker 2: our labor or the wages we'd have to pay the
Speaker 2: labors be way more so you can start to realize
Speaker 2: how this SUBSETI is our way of life. Like globalization
Speaker 2: has really in many ways been a subsidy for Western civilization.
Speaker 2: I mean it just the way it is. Number three.
Speaker 2: If interest is number one and cheap labor and resources
Speaker 2: is number two, I mean number three is political control.
Speaker 2: I mean again, we would literally shape these economies. So
Speaker 2: it's not just that we would get cheap labor and resources,
Speaker 2: but we would make them dependent on us. And that's
Speaker 2: what I was talking about the other day in terms
Speaker 2: of like, by setting up the monetary system the way
Speaker 2: it is, we would like make sure that certain things
Speaker 2: were priced only in dollars, like obviously hydrocarbons being like
Speaker 2: the major thing. So if you could only get oil
Speaker 2: in dollars, if you're a little country, and you know,
Speaker 2: I think the mmtiers really get this wrong. They always
Speaker 2: say it's not a big deal. You can just buy dollars.
Speaker 2: Oh you want to try doing that. Let's say you
Speaker 2: have a week currency. You want to go out and
Speaker 2: try buying dollars.
Speaker 1: You can sell You're to sell your currency to.
Speaker 2: Buy print your currency to buy dollars. Your currency is
Speaker 2: getting tank. It doesn't work. Plus there's often not like
Speaker 2: deep liquid pairs, like trading markets for like these random currencies,
Speaker 2: So it's not really an option to buy dollars to
Speaker 2: buy oil. That's why these countries have to do exports.
Speaker 2: You have to earn the dollars. You have to sell
Speaker 2: something to the US or its allies for a hard currency,
Speaker 2: then use that to buy the oil. So you want
Speaker 2: to just basically to continue the point, to close the point,
Speaker 2: like if you want oil or industrial tractors or fertilizer
Speaker 2: or whatever, you can't use gunna and CDs. You have
Speaker 2: to export something like coffee and earn dollars in your
Speaker 2: foreign exchange account, and then from there you can buy
Speaker 2: the oil or the CDs. So this is a completely
Speaker 2: different paradigm than with like America, where we can just
Speaker 2: print dollars to buy anything we want. So this is
Speaker 2: why there's like these vast inequalities in the monetary system.
Speaker 1: There was a there was a report that China put
Speaker 1: out the Government of China, and I forget which division
Speaker 1: I use it in a video, but call off the
Speaker 1: top of my head, but they basically pointed to this
Speaker 1: exact situation, said the US is lots of things you
Speaker 1: used to do wrong. But one of them is that they
Speaker 1: print dollars. They said in the report, it costs the
Speaker 1: United States seventeen cents to make one hundred dollars bill,
Speaker 1: but these countries have to give up one hundred dollars
Speaker 1: massive seeds ridge to get to get well.
Speaker 2: Then the other thing is so you have the three benefits, right,
Speaker 2: so you have interest, cheap labor and resources and political
Speaker 2: control like that. Like if anyone says the IMF World
Speaker 2: Bank are a wasteful or that it's a waste of
Speaker 2: tax payer money, they're not. They're missing the big point. Yes,
Speaker 2: it's true they're very bureaucratic, corrupt, and they're not very efficient.
Speaker 2: That is true, But then you're missing the deeper point
Speaker 2: that they are absolutely self interested organizations. Sure, like we have,
Speaker 2: our advancement has not been in spite of these things.
Speaker 2: It has very much been because of them. They today
Speaker 2: remain so important. I mean, the IMF is a trillion
Speaker 2: dollar organization and the World Bank is still the largest
Speaker 2: development bank in the world. I mean, we may hear
Speaker 2: about them less than news, and there are other really
Speaker 2: important institutions like the WTO and the BIS, et cetera.
Speaker 2: But these remain so so important to the Bretton Woods
Speaker 2: economy as such, I mean until it crumbles. I mean,
Speaker 2: they are pillars of the world order, right. China has
Speaker 2: tried to copy them, and the CCP has seen what.
Speaker 1: We did sort of like their Belt and Road.
Speaker 2: Yeah, they're like, we want to not so much. The
Speaker 2: IMF they've done some of that, but most of it's
Speaker 2: sort of World Bank style infrastructure funding. They've done a
Speaker 2: ton of it, but it's dried up in the last
Speaker 2: year and a half or so and.
Speaker 1: Started to backfire.
Speaker 2: Well they do they don't mint the reserve currency, so
Speaker 2: if a country goes bankrupt, it's harder for them to
Speaker 2: just write another loan, you know, it's harder for their
Speaker 2: banking system to do that. They can't just like make
Speaker 2: reserves up like we can. So they've tried to copy it.
Speaker 2: I would expect any regional power to try and copy
Speaker 2: this thing. Sure, like you know, so long as that
Speaker 2: these like multivari fiat currency system exists. But like the
Speaker 2: point is, they can't even replicate what we've done, and
Speaker 2: it's had such a tremendous impact on the world. I mean,
Speaker 2: it's uh, it's it's it's tough because when these when
Speaker 2: these countries take these loans that we benefit from, we
Speaker 2: ask them to do something called structural adjustment. So these
Speaker 2: loans have conditions that range from like raising taxes, shrinking
Speaker 2: the banking sector, raising interest rates, devaluing the currency, ending
Speaker 2: all subsidies on food and energy. So basically, like we
Speaker 2: would call it austerity, or like putting your country into
Speaker 2: a recession, and that is done so that the exports
Speaker 2: become more competitive that we can buy the exports for cheaper.
Speaker 2: Like if those countries, if their wages are too high
Speaker 2: and they have too much social security and free healthcare
Speaker 2: and education, then we want then then the stuff they
Speaker 2: make will be too expensive for us to buy, right,
Speaker 2: so we need to make sure that it's cheap sta chea.
Speaker 2: So like we don't want any social benefits for anybody
Speaker 2: in that country, and we want them to be cheap
Speaker 2: as hell.
Speaker 1: Which is a little counterintuitive because you think you'd want
Speaker 1: them to do better so they can actually pay back
Speaker 1: the loan.
Speaker 2: I think there's a lot of interesting, sort of paradoxical
Speaker 2: stuff here because like, yeah, a, in a classic free market,
Speaker 2: you would think that that like subsidies on food and energy,
Speaker 2: are a bad idea, and in general they are a
Speaker 2: bad idea. But you can't go from if you can,
Speaker 2: I mean they do it all the time. It's very
Speaker 2: hard to go from a society where food and energy
Speaker 2: is subsidized to the next day it being really expensive, right,
Speaker 2: Like that that's what the IMF would do, and people
Speaker 2: would just starve. I mean, like it's not a natural
Speaker 2: course of development, right, same thing with property, Like like
Speaker 2: one would think that nationalization is a really bad idea, right,
Speaker 2: but one thing that would happen is that like these
Speaker 2: countries would develop industry and then like due to IMF policy,
Speaker 2: they would end up selling like massive dams or whatever
Speaker 2: off for like firesale prices to foreign ownership. So one
Speaker 2: thing is like thinking about the economy in a domestic sense,
Speaker 2: I just think the global the world is a big system,
Speaker 2: and it's a little more nuanced than that. Like, like
Speaker 2: there are interesting paradoxes when it comes to like free
Speaker 2: markets in as much as there isn't a free market,
Speaker 2: so everything is like stacked against us, Like we would
Speaker 2: never think about it this way. So Britain, Germany, France,
Speaker 2: United States, Japan, we're not doing austerity at home, like
Speaker 2: we never like, like it's not like we dictate to
Speaker 2: Germany that they devalue their currency and cut like social subsidies.
Speaker 2: That's only done towards poor countries. So total hypocrisy. Like
Speaker 2: Britain has currently a price cap on energy in Britain
Speaker 2: right now, and they've always had all kinds of free
Speaker 2: healthcare and stuff like that, but they would go to
Speaker 2: like little countries like Sri Lanka and demand that they
Speaker 2: end their subsidies for rice. So like in theory, yes,
Speaker 2: all subsidies that distort free market stuff I think are wrong,
Speaker 2: but like what you ended up having was rich countries
Speaker 2: being highly subsidized and poor countries having nothing. So this
Speaker 2: perpetrates and keeps this cycle going of them becoming poor
Speaker 2: and poor and needing to borrow more and more for
Speaker 2: us from us.
Speaker 1: And keeping the cost of goods and services low so.
Speaker 2: That we can have it for cheaper. Yeah, and this
Speaker 2: is why you see the external debt of poor countries
Speaker 2: go exponential from the beginning of the Fiat age. And
Speaker 2: I just think I don't think bitcoin entirely fixes this.
Speaker 2: I just think that if you have a neutral, open
Speaker 2: monetary language for the world, then we don't have such disparities,
Speaker 2: and wages are going to be like a little tighter
Speaker 2: than they are now, and you're going to have a
Speaker 2: more equal exchange. And further, if bitcoin is the reserve currency,
Speaker 2: it's instead of the dollar, then like wealthy countries don't
Speaker 2: have the exorbitant privilege of just printing it, and the
Speaker 2: poor countries can just turn if they want to. It
Speaker 2: may not make sense for everybody, but if you have
Speaker 2: cheap electricity, you can just print bitcoin. I mean not
Speaker 2: print it, but you can investigate and make it without
Speaker 2: permission from the world power, which is key a current only.
Speaker 2: Like like countries that don't agree with the United States
Speaker 2: cannot get dollars or it's hard for them to get dollars.
Speaker 1: And you would say that they could do that now,
Speaker 1: they could print bitcoin if they had the energy. They
Speaker 1: could also grow bananas, rice, wheat, But what you're saying
Speaker 1: is that the US says, no, you can't grow wheat.
Speaker 2: Well, my general I'm just always changing, you know, involving
Speaker 2: my perspectives. But I think that at the moment what
Speaker 2: makes the most sense is like if we do end
Speaker 2: up having a bitcoin standard, like like mining won't be
Speaker 2: for every country, like mining is as you know, it's
Speaker 2: like a very expensive it's not like a hugely profitable
Speaker 2: necessarily industry all the time. It could be very unprofitable.
Speaker 2: Sometimes it's very specialized. And you think of it kind
Speaker 2: of like gold mining, like not every country, like not
Speaker 2: every country does gold mining at scale. I mean, part
Speaker 2: of that is just because there's not gold everywhere, But
Speaker 2: in general, I think what you could expect is like
Speaker 2: countries that have cheap energy will do bitcoin mining. Countries
Speaker 2: that don't, like maybe like Japan or something, they will
Speaker 2: like provide services and they will like export stuff and
Speaker 2: they'll by bitcoin with their reserves. So I think it's
Speaker 2: just kind of I mean, it may look a little
Speaker 2: more close to like kind of the gold standard, where
Speaker 2: like countries had a pile of gold and like when
Speaker 2: it drew down too much, like it weakened their currency.
Speaker 2: Like I do think we'll go through a time where
Speaker 2: we have essentially fiat currencies that are that are probably
Speaker 2: backed in some way by bitcoin or like a bitcoin
Speaker 2: dominant reserve.
Speaker 1: When the IMF was founded, John Mayer Keans wanted to
Speaker 1: not be on the dollar standard. He wanted to be
Speaker 1: on a bank or yeah, he wanted to have been
Speaker 1: sort of like that reserve.
Speaker 2: Well, the Bank Corp was just supposed to be like
Speaker 2: a basket of currencies, right, so it was supposed to
Speaker 2: have more of a globally democratic character to it. But
Speaker 2: he was vetoed so the US got its way. And yeah,
Speaker 2: I mean I again, I think that it's possible we
Speaker 2: evolve into kind of like a neo Breaton Wood system
Speaker 2: here where there are like probably fiat currencies pegged to
Speaker 2: some sort of redeemable rate of bitcoin. I think it's
Speaker 2: possible that eventually we even moved beyond that, and it's
Speaker 2: possible we just use bitcoin as money. But I mean
Speaker 2: we're not. We're just nowhere near there technically, like technology
Speaker 2: technologically yet. Yeah, and you have to you look at
Speaker 2: like Britain. I mean, Britain started to fail as an
Speaker 2: empire a long time before the sterling failed as the
Speaker 2: world reserve currency, so it's very sticky. So I also
Speaker 2: think you can see a world where like bitcoin moons,
Speaker 2: but like people still use the dollar for stuff.
Speaker 1: Sure, well, in the pounds sterling, it was a thirty
Speaker 1: to forty year process. Here we are eighty nine years later,
Speaker 1: and it's still the top three currents.
Speaker 2: A world bitcoin could like explode in price and interest
Speaker 2: could go way up and you could have much more
Speaker 2: global adoption. But like the technology of daily payments could
Speaker 2: could lag. I mean, you could still end up using
Speaker 2: dollars for a long time. I think eventually they like
Speaker 2: it would they go obsolete. I mean this is like
Speaker 2: tears law, like, and I think people should really study
Speaker 2: dollarizing countries if they want to know what this is
Speaker 2: going to look like. It's not going to be Gresham's
Speaker 2: law forever. It's not going to be. I mean, it's
Speaker 2: it's it's it's it's not going to be, even though
Speaker 2: the government's going to try and force it. Like merchants
Speaker 2: are just gonna they're not gonna want your fiat eventually
Speaker 2: and then that's gonna spur circular economy. But until that day,
Speaker 2: I mean, yeah, most people will save bitcoin because if
Speaker 2: they can, because like why wouldn't you You try at
Speaker 2: least you might ideologically want to spend something, which I
Speaker 2: think is wonderful and important. But like, ultimately, I don't
Speaker 2: think that the needle's going to move for the majority
Speaker 2: of people on what you do with your bitcoin until
Speaker 2: merchants start basically saying providing a premium or like basically
Speaker 2: a discount for bitcoin and a premium on fiat. It's
Speaker 2: kind of like if you like, some people will say
Speaker 2: today they prefer cash to bank money. They want the cash, right. Yeah.
Speaker 2: I think in the future they'll even offer a discount sometimes,
Speaker 2: right if you pay me like like a like a
Speaker 2: like a contractor at your house, if you're doing your house,
Speaker 2: they may offer to do it for a little less
Speaker 2: if you're paying cash. So that's when I think you
Speaker 2: start to see in the future, Oh, I'll do it.
Speaker 2: I'll do it for a little less if you pay
Speaker 2: me a bitcoin, right, And then eventually it just becomes like, oh, sorry,
Speaker 2: I don't take fiat, I don't take dollars, I take bitcoin.
Speaker 2: I just think that that process may take decades, Like
Speaker 2: it just might be sticky.
Speaker 1: It's certainly accelerating with the rise of the authoritarian nations,
Speaker 1: and it's seems seemingly rapidly by.
Speaker 2: What I want money that's deplatformable, Like, I think the
Speaker 2: only way this revolution fails is if governments stop deplatforming
Speaker 2: people and stop devaluing currents.
Speaker 1: They take away the need, they take away the need
Speaker 1: for it.
Speaker 2: Yeah, there's no need for bitcoin, It'll die. Why would
Speaker 2: you feed it any energy if it was useless. I'm sorry, though,
Speaker 2: I just don't believe in a world where we're going
Speaker 2: to see less deplatforming and less devaluation of currency. I
Speaker 2: think we're going to see a lot more to platforming
Speaker 2: and a lot more devaluation because that's what governments do.
Speaker 2: So I see a world where bitcoin gets much more
Speaker 2: valuable and widely used. I just think it's just going
Speaker 2: to be. And as for the impact on these institutions,
Speaker 2: I think over time, I mean, they essentially start to
Speaker 2: go bankrupt, like the loans they start to lend out
Speaker 2: get defaulted on, and they are not able to refill
Speaker 2: the basket as much, and I think they shrink, and
Speaker 2: I think they might still survive, like in more of
Speaker 2: an original capacity. Like that, a handful of powerful countries
Speaker 2: may choose to like retain a fund to help put
Speaker 2: out fires so that the trade keeps going. That could
Speaker 2: totally happen on a sound money standard. And again you
Speaker 2: might have like again like a fund where it's like okay,
Speaker 2: like in the in our common collective self interest, we
Speaker 2: may want to like help this country develop a little bit,
Speaker 2: but like those loans are going to be much more
Speaker 2: like prudent and like like examined carefully, as opposed to like, yeah,
Speaker 2: you can just keep all this money and like don't
Speaker 2: worry about it.
Speaker 1: And the goal would be to give them the loan
Speaker 1: and help hopefully help them grow so they can grow
Speaker 1: their way out of it.
Speaker 2: Like Jeff Booth calls this forced cooperation. I really like that.
Speaker 2: I mean both at the nation state level, like as
Speaker 2: you're describing, but also at the labor level, at the
Speaker 2: individual level, like you're just there's more forced cooperation and
Speaker 2: less again unequal exchange.
Speaker 1: So cooperation as opposed to coersion, yeah, or exploitation.
Speaker 2: Like again, like the classic example of like it comes
Speaker 2: to the Ghana, it has a lot of gold. I mean,
Speaker 2: I don't think you need to subscribe to any ideology
Speaker 2: to object to the fact that ninety five plus percent
Speaker 2: of the gold profits over the last thirty forty years
Speaker 2: have gone to people outside of Ghana. And that's in
Speaker 2: large part due to this Fiat credit system. I mean,
Speaker 2: it's not entirely because of it, but it certainly is
Speaker 2: exacerbated by it.
Speaker 1: Right, So if I'm tracking this, the problem is that
Speaker 1: through the financial system that we have set up in
Speaker 1: the IMF, etc. Through these exploitive type loans. It extracts
Speaker 1: the wealth and it forces people to remain in poverty.
Speaker 2: It deflates their wages and.
Speaker 1: Deflates their wages. So it's not the fact that the
Speaker 1: West or whatever is going to these countries and paying low,
Speaker 1: low wages for labor or things like that, because they're
Speaker 1: providing jobs and they're bringing them out of poverty. It's
Speaker 1: the fact that they're forcing them to stay down, not
Speaker 1: allowing them.
Speaker 2: We also, like our corporations get like favorable rules in
Speaker 2: these countries. So for example, like say you're a giant
Speaker 2: American Coca Cola or something like remember you're like a
Speaker 2: dollar native firm, so when you move into one of
Speaker 2: these countries, you are much more. You have such an
Speaker 2: advantage over local soft drink makers who are priced in
Speaker 2: the local currency that's being devalued. All of a sudden,
Speaker 2: the imports they need to make everything gets so expensive
Speaker 2: and they go out of business. I mean, this is
Speaker 2: why people don't like multinational corporations in poor countries because
Speaker 2: of the monitor. It has partly to do with the
Speaker 2: monetary element of it, like again, these are firms that
Speaker 2: are dollar native or your own native or yen native
Speaker 2: or whatever. They're not the Peso native or lira a
Speaker 2: native or whatever. So it's like an outgrowth of our
Speaker 2: current system whatever you want to call it. Is like
Speaker 2: the dominance of multinational firms in countries that have in
Speaker 2: poorer countries. And this is this is absolutely exacerbated by
Speaker 2: the World Bank and the IMF. I mean, there's this
Speaker 2: whole I mean, the whole double loan phenomena is where
Speaker 2: like we we you know, let's say France gives one
Speaker 2: hundred million dollars to Ivory Coast. The of Orians immediately
Speaker 2: give one hundred million right back because they hire French
Speaker 2: companies to build all the stuff. So France has been
Speaker 2: paid back. The French economy is now whole from the loan,
Speaker 2: but the Avorians still have to pay back principal plus interest.
Speaker 2: So France will make one hundred and fifty million euros
Speaker 2: over the duration of this project, just as an example.
Speaker 2: They'll make principal plus interest plus I mean, I mean
Speaker 2: plus that be paid back. So this is how you
Speaker 2: can start to see that like the West is like
Speaker 2: earning a lot of value you from from from deploying
Speaker 2: credit to poor countries as any I mean, who benefits
Speaker 2: qui bono in a loan? I mean yes, the point like, yes,
Speaker 2: if I take out a loan and I do it
Speaker 2: carefully and I pay it back, I can benefit, right,
Speaker 2: you can. The problem is this isn't to This isn't
Speaker 2: a healthy like one off, Okay, we solved it. This
Speaker 2: is an infinite debt trap where the loan gets paid
Speaker 2: back by another loan and then all of a sudden
Speaker 2: it's a ponzi like. It's a ponzi like. The only
Speaker 2: way the new loans can get paid back is with
Speaker 2: more loans. And this this was just became like the
Speaker 2: people who run the system became ware this in the seventies.
Speaker 2: They realized this there was no way these countries could
Speaker 2: pay back as debt. The only way to pay it
Speaker 2: back with more debt.
Speaker 1: And so what I'm just trying to differentiate for everybody
Speaker 1: listening and maybe even for myself, is it's not the
Speaker 1: problem of extending loans to people that needed and helping
Speaker 1: them come up. It's the it's the finance, it's the
Speaker 1: it's the dollar scene riage that forces you to take
Speaker 1: loans and forces them to do things that are holding
Speaker 1: them back, like you said, only producing goods that we want,
Speaker 1: not goods that would help you, and never allowing them
Speaker 1: to grow out of that. So if I said, hey, Alex,
Speaker 1: you need a loan, we give you some money, and
Speaker 1: then you're able to turn your business around, make a
Speaker 1: bunch of money, pay me back, and now your life
Speaker 1: is much better. Like, that's a good thing. That's a
Speaker 1: free market, that's cooperation.
Speaker 2: Sure, I think there'll be a credit in the bitclin standards.
Speaker 1: Well, because of the scene riage, that's the problem.
Speaker 2: Well, right, it's like think about it this way. Like
Speaker 2: if you are lending dollars to a country and they
Speaker 2: owe you one hundred dollars and then like their currency
Speaker 2: gets devalued, they're going to have a hall of a
Speaker 2: time paying back that hundred dollars. So when you think
Speaker 2: about the way I am structural adjustment, which is the
Speaker 2: condition that the loans come with, is that usually it
Speaker 2: ends up devaluing the currency and raising price inflation inside
Speaker 2: the country for the majority of the people. Yeah, that's
Speaker 2: not just like taking out a loan and paying it back.
Speaker 2: There are other structural things happening here that really impovers people,
Speaker 2: and this should just be more widely discussed.
Speaker 1: Yeah, and are you you said you know, you kind
Speaker 1: of talked about like the dollar taking them for the
Speaker 1: pound Starli And that's a long process, and so we're
Speaker 1: in a long process.
Speaker 2: Well, we've also never had anything like bitcoin before though, right,
Speaker 2: I mean we don't know. I mean it could be
Speaker 2: gradually even suddenly.
Speaker 1: And we've never had the We've kind of never had
Speaker 1: this full coret press from authoritarians, both both in devaluation
Speaker 1: the rise of censorship.
Speaker 2: I mean, to give an example, look at the bank run.
Speaker 2: I mean, social media and electronic money made a bankrun
Speaker 2: much faster, right if you looked at SVB. Sure, well,
Speaker 2: social media and electronic money might make like the switch
Speaker 2: to a new reserve currency way faster. It might take
Speaker 2: years or months or days instead of decades. It's I mean,
Speaker 2: I'm just throwing it out sure like, like we're definitely
Speaker 2: living in a world where these transitions can happen.
Speaker 1: Faster and information travels fast. People find out about these solutions, Like.
Speaker 2: When the sterling was being phased out, like there were
Speaker 2: people who didn't even learn about it for like years.
Speaker 2: That's not going to I mean, if bitcoin starts to Moon,
Speaker 2: everybody's gonna find within like a week like on Earth,
Speaker 2: like that information will travel and even people who don't
Speaker 2: know what bitcoin is are going to be like, what
Speaker 2: the hell's going on there? So I just think it's
Speaker 2: a it could happen really really fast, which is why
Speaker 2: it's so so important. And I guess we'll just conclude
Speaker 2: with this that, like we work to help communities understand bitcoin,
Speaker 2: Like what we want to do with the Human Rights
Speaker 2: Foundation is just work on ux and education. We want
Speaker 2: to make bitcoin easier to use, safer to use, more
Speaker 2: private to use. We also want to make sure that
Speaker 2: people understand the value of self custodying bitcoin. It's just
Speaker 2: all about right now. I understand that on chain bitcoin
Speaker 2: will get expensive in the future, that's the way it's
Speaker 2: going to be. That's how the fee market's going to work.
Speaker 2: But right now you can get on board, you can
Speaker 2: open the channel, you can get into lightning, you can
Speaker 2: self custody bitcoin. We had that couple days there where
Speaker 2: fees got out of hand. I mean we can expect
Speaker 2: more of that. That's a glimit of the future, but
Speaker 2: they're back down to like a dollar, so a couple
Speaker 2: of dollars. So let's do as much as we can now,
Speaker 2: and we won't regret it. I mean, the only thing
Speaker 2: we'll regret in ten years is not doing more of it.
Speaker 2: So let's educate and spread the word as much as
Speaker 2: we can. And really that's what you're seeing as like
Speaker 2: a resistance to the IMF and World Bank. As you're
Speaker 2: seeing in the countries that got structurally adjusted the hardest
Speaker 2: you saw them, you saw them flock to bitcoin and
Speaker 2: different kinds of like basically stable coins and bitcoin like
Speaker 2: the highest, Like if you look at the percentage of
Speaker 2: people in those countries who use these things, it's like
Speaker 2: way higher than in America. It's like Nigeria or talking
Speaker 2: like twenty percent of Internet users using bitcoin and cryptocurrency
Speaker 2: in some way. Where's in America it's like around ten percent. Yeah,
Speaker 2: So it's like it's just it's it's people are seeking
Speaker 2: a way out, and it makes total sense, and I
Speaker 2: think you can expect to see more of that.
Speaker 1: So higher the pain, the more people are going to
Speaker 1: move to the solution.
Speaker 2: I'm just glad that there is a way out. I
Speaker 2: don't know, again, I don't think it saves entire countries
Speaker 2: and I don't think we're speculating, but what's not a
Speaker 2: matter of speculation is that it can save individuals and
Speaker 2: that's something we're celebrating and we will continue to focus
Speaker 2: on that.
Speaker 1: Yeah cool, well, well we can wrap it up with that.
Speaker 1: Thank you, Human Rights Foundation.
Speaker 2: Yeah h r F or h r h h r
Speaker 2: F Yeah, h r F, Yeah h R h r
Speaker 2: F dot org.
Speaker 1: Yeah, so everyone check that out? Anything else?
Speaker 2: Oh?
Speaker 1: Your books?
Speaker 2: Got check out the Bookhidden Depression. The book on Amazon.
Speaker 2: It's on the Bitcoin mag site if you want to
Speaker 2: buy it with bitcoin, So uh, you do what you wish.
Speaker 1: Yeah, I would.
Speaker 2: Appreciate if you checked it out, left a review on Amazon.
Speaker 2: That'd be great. And thank you so much for having
Speaker 2: me Mark, all right, thanks, appreciate it.