Speaker 1: Doctor wolf in law. You're an academic somewhat, but you're
Speaker 1: an academic that teaches and has studied and learned and
Speaker 1: taught on real world things. So I think there's a disconnect. Right.
Speaker 1: There's the saying, which I'm sure academics don't like, or
Speaker 1: professors that those who can do those who can't teach.
Speaker 1: And what I see a lot of is people in
Speaker 1: academia in politics seem to have like no real world grounding.
Speaker 1: They have a lot of theory, but like you've never
Speaker 1: balanced a checkbook, you've never ran a business, Like what
Speaker 1: do you know?
Speaker 2: And you can tell by.
Speaker 1: The policies that they do, right, I mean, have you
Speaker 1: seen that? Would you agree with with that for a
Speaker 1: lot of a lot of cases?
Speaker 3: One hundred percent?
Speaker 1: Ok?
Speaker 3: Yeah, one hundred percent.
Speaker 4: I And that's the reason why I'm not in academia anymore.
Speaker 4: At some point I made I was getting my PhD.
Speaker 4: And I was reading, writing, thinking and teaching, and I
Speaker 4: was asking myself the question like, hmm, do we want
Speaker 4: to do the same thing ten years from now? And
Speaker 4: the answer was no, because realistically, as somebody with my
Speaker 4: ideas cl'sicalliberal libertarian ideas, what would realistically happen to me.
Speaker 4: Even if I'm very good, like I would end up
Speaker 4: in the middle of nowhere, someone in Utah are teaching
Speaker 4: like one hundred kids that don't give it. Yeah right, yeah,
Speaker 4: And so that that is not really something that was
Speaker 4: aspiring to do. And now I'm a CEO of a
Speaker 4: nonprofit where we have impact in over one hundred three countries,
Speaker 4: ninety staff members we're paying actually twenty of them are
Speaker 4: being paid in bitcoin regularly. And so I have all
Speaker 4: kinds of different business challenges in the organizing events all
Speaker 4: across the world. And that's that's so much more interesting
Speaker 4: and I have so much more impact than compared to
Speaker 4: it if I were staying in academia.
Speaker 1: Yeah, so you you're an entrepreneur, you're a business owner.
Speaker 1: I mean, it's a nonprofit, but it's a business, yes,
Speaker 1: And so now you have to deal with rural challenges
Speaker 1: as you're talking about when you made the jump from
Speaker 1: academia into business, was it sort of like all these
Speaker 1: things you had kind of studied and learned, and now
Speaker 1: of a sudden you're having to deal with it, and
Speaker 1: it it kind of gave you like a new revelation
Speaker 1: and you kind of realized.
Speaker 2: It was different.
Speaker 1: Like if if I watch UFC on TV all the time,
Speaker 1: I'm like, Oh, I'm gonna go be a fighter, and
Speaker 1: then I jump in the ring, like I'm not prepared
Speaker 1: to be in the ring just because I watched a
Speaker 1: bunch of UFC something like that.
Speaker 3: I think there's definitely truth to that.
Speaker 4: Academia teaches you a few things, but I think for
Speaker 4: most people it's not necessary to go into that. I've
Speaker 4: learned to grind as you're writing a PhD. So you
Speaker 4: have to write like every day and probably like over
Speaker 4: seventy percent of everything that you're writing is going to
Speaker 4: be thrown out. So dealing with frustrations, dealing with motivating
Speaker 4: yourself every single day, that sort of thing is being taught,
Speaker 4: but it comes at a high cost, not only financially,
Speaker 4: but also the opportunity costs. So I would say most
Speaker 4: of the skills that I'm using right now in business
Speaker 4: is why I'm in the business that I'm in right now,
Speaker 4: because I'm a product of the organization. So Students for
Speaker 4: Liberty is empowering volunteers to spread the ideas of liberty
Speaker 4: all across the world while focusing on like giving them
Speaker 4: aunts of leadership skills. So when I got out of
Speaker 4: that program as a young twenty year old, I've raised
Speaker 4: fifty thousand years as a young person. I've started a
Speaker 4: whole training program. I probably interviewed like one hundred to
Speaker 4: one hundred and fifty people, and those gave me like
Speaker 4: real world skills that I'm employing right now. But that's
Speaker 4: not the average experience that you have. Like university was
Speaker 4: more to vehicle for my volunteer experience than the vehicle
Speaker 4: for the ideas that made.
Speaker 3: Me a more effective leader. Does that make sense?
Speaker 1: Yeah, So now you've started this student for liberty. This
Speaker 1: is your works life or your life's work. This is
Speaker 1: like your passion. So I was asked this question yesterday
Speaker 1: on a panel I was speaking at it that I
Speaker 1: thank God for bitcoin. What is freedom? Then maybe I'll
Speaker 1: ask you what is liberty? And our freedom and liberty
Speaker 1: the same.
Speaker 4: Yeah, that's an interesting debate right there. I would say,
Speaker 4: just to define libertine freedom and I often use them interchangeably,
Speaker 4: since it's like liberty in the name, I'm using that more.
Speaker 4: I would say it's I would you can define it
Speaker 4: like negatively or positively. There's like negative freedom and there's
Speaker 4: positive freedom, which I don't think is like liberty at all.
Speaker 4: Negative freedom means it's like you are just there's the
Speaker 4: absence of violence against you, you are protected, your property
Speaker 4: is protected. So that's like negative lity.
Speaker 2: So freedom from.
Speaker 4: Exactly freedom from something instead of freedom for something. Because
Speaker 4: most of the progressive and even I would say, like
Speaker 4: conservatives would say like, oh no, no, no, you should
Speaker 4: have like you can only live like a free life if.
Speaker 3: You have like health care and education and all of
Speaker 3: these things, and that only enables you to become like
Speaker 3: a fully.
Speaker 2: So you can't be free.
Speaker 1: So they would argue Bernie Sanders would probably argue that
Speaker 1: if you're broke, you can't be free because now you
Speaker 1: can't go do things that you want.
Speaker 4: Correct, And like his ideology goes way deeper. That has
Speaker 4: really permeated the whole society because they're thinking socialist. That
Speaker 4: is generally that people are being exploited by the capitalist
Speaker 4: system because whoever the entrepreneur is on top of it.
Speaker 4: So like your workers right now that are helping us
Speaker 4: setting up this beautiful conversation, right, they're being exploited because
Speaker 4: you're on top and you are abusing them there's like
Speaker 4: surplus value that they're producing, but you're taking money out
Speaker 4: of them. And that comes from the ideas back back
Speaker 4: then with factories and that you have like one person
Speaker 4: in charge, and so they think it's innately unfair. Therefore
Speaker 4: you have to redistribute. And there's so many other ideas
Speaker 4: like vocism that fits within that right now that you
Speaker 4: say like.
Speaker 3: Okay, maybe we need markets.
Speaker 4: However we need to really tame them with like the
Speaker 4: wide ideology, and we have to have like mix of
Speaker 4: people in there, and it cannot be just like yeah, whomever.
Speaker 2: There's so much to unpack right there.
Speaker 1: You know, I wrote this book last year, the Uncommunist Manifesto.
Speaker 2: We kind of broke that down. So there's a lot
Speaker 2: to unpack there.
Speaker 1: But going back to the freedom thing, So freedom from yep,
Speaker 1: so freedom from having my private property taken, freedom of speech,
Speaker 1: freedom from being censored of my speech right, so be
Speaker 1: freedom So almost like freedom is like is not a
Speaker 1: it's like an ad adjective or whatever, so it has
Speaker 1: to be freedom from or so, but what about freedom
Speaker 1: and liberty?
Speaker 4: The distinction between freedom and liberty, it's an interesting just
Speaker 4: interesting question.
Speaker 2: Or just what is liberty?
Speaker 5: Then?
Speaker 4: Yeah, I would just say, like a state where you
Speaker 4: have these constraints lifted from you, and it's always like gradual, right,
Speaker 4: we are not never perfectly free, and it's always like
Speaker 4: a gradual thing because there's always constraints on us, and
Speaker 4: some constraints are good and someone's very it makes sense,
Speaker 4: like I mean, some people would say, like it's again
Speaker 4: like the freedom towards something like you should have at
Speaker 4: least like a like a UBI, like a universal basic income,
Speaker 4: because then it's the only way that you can flourish.
Speaker 4: No like you need to you need to make like
Speaker 4: a living, You need to produce value in the world
Speaker 4: for others, and that's what the free market system allows
Speaker 4: you to do through and it's just like a beautiful thing.
Speaker 4: You have voluntary exchange. You are like let's say we
Speaker 4: do a trade. I give you my coffee, you give
Speaker 4: me like three dollars. I value your three dollars more,
Speaker 4: you value the coffee more. We're doing that exchange and
Speaker 4: we both say thank you at the end of the day,
Speaker 4: and if we don't, then no deal exactly exactly. So
Speaker 4: that's that that is really voluntary and it's mutually beneficial
Speaker 4: and most economists especially like leftist.
Speaker 3: Really don't get that anymore. And that's that's sweety. It's
Speaker 3: quite something.
Speaker 2: Yeah.
Speaker 1: So we were talking about the Austrian school of economics,
Speaker 1: which I want to get into with you obviously, Well
Speaker 1: you're you're you're master's.
Speaker 2: In it or yeah, I go to Mass's and it,
Speaker 2: so you know way more than I do.
Speaker 1: I kind of think of ludlove on Misis as kind
Speaker 1: of the father I think maybe you might say Manger, yeah,
Speaker 1: Minger whatever.
Speaker 2: Anyway, and then f. A.
Speaker 1: Hyek Is is kind of a big figure for me
Speaker 1: in that. And and he wrote several good books. The
Speaker 1: Road to served him, I think as a must read
Speaker 1: for everybody. But he I believe it was. His last
Speaker 1: book was the Constitution of.
Speaker 6: Liberty Constitution of Society, and he defined it as liberty
Speaker 6: being free of freedom, freedom free of coercion.
Speaker 1: Mm hm, so coercion being I'm given the illusion of choice,
Speaker 1: take the job or lose your job. It's my choice,
Speaker 1: but either choice leads me to your ends versus I
Speaker 1: want freedom of coersion, that I can make a choice
Speaker 1: that leaves me to my own ends. That's kind of
Speaker 1: how I think about it.
Speaker 4: That's a very good way of thinking about it, and
Speaker 4: there's a lot of richness, just like within the Austin
Speaker 4: tradition generally, and like many of the things that also
Speaker 4: like witcoiners believe come from that. For instance, like the
Speaker 4: power of spontaneous order. People always use it and are joking.
Speaker 4: You can see this that this conference is say're like, oh,
Speaker 4: that's like a line forming in front of the bufet
Speaker 4: and people are a spontaneous order. No, it's like much deeper.
Speaker 4: It is spontaneously governing institutions that nobody willed by decree,
Speaker 4: but came about by human action, not by human.
Speaker 3: Design, human action, not by human design.
Speaker 4: And that is such a rich insight that Hayek helped proliferate.
Speaker 4: And that means, for instance, not only money, but also
Speaker 4: law and language. Nobody invented the English language, nobody invented
Speaker 4: common law. That just came about through hundreds and hundreds
Speaker 4: and sometimes thousands of years of people interacting with one another.
Speaker 4: And once you understand that, which is like a deeply
Speaker 4: Austrian insight or classical liberal generally, once you understand that,
Speaker 4: that gives you some sort of humility as to what
Speaker 4: you can command in society and what politicians can accomplish. However,
Speaker 4: that sort of humility.
Speaker 3: I find strangely absence from most ideologies.
Speaker 2: That's one of.
Speaker 6: Elect the lack of humility Hubris Ubis, I would say, yes, absolutely,
Speaker 6: I would say it's classical liberals.
Speaker 4: And I like that term better than libertarians because that
Speaker 4: term has so many negative connotations to it, and classical
Speaker 4: liberalism has like a little bit more of the weight
Speaker 4: of the history, and like Locke and Adam Smith and
Speaker 4: even like the Salamanca School in Spain, and like many
Speaker 4: other thinkers that contributed to it, versus libertarianism, which is
Speaker 4: a very new word which only originated in the nineteen
Speaker 4: sixty s in the United States, and many great thinkers
Speaker 4: behind it, like Rothbart And I'm a fan of thinkers
Speaker 4: like that, But like I'm using that term because it
Speaker 4: conveys like a little bit more of the depth and
Speaker 4: the sophistication of the ideas that gives you really an epistemic,
Speaker 4: like how do you look at the world aumidity, Like
Speaker 4: you don't know how we all should live here in
Speaker 4: this womb, and like what are the best choices for
Speaker 4: a life? Often we don't know from one day to another,
Speaker 4: what's the best choice for our life and then to
Speaker 4: say like, hey, we have like somebody in charge right
Speaker 4: now who's like ancient, who can make decisions for like
Speaker 4: thirty million people exactly. That's mind boggling. I mean, there's
Speaker 4: many reasons for that, but it's really astonishing if you
Speaker 4: think about it.
Speaker 1: Yeah, so you had this Austrian school of economics and
Speaker 1: this is a big question, but let's let's see if
Speaker 1: we can if we can go surface on that, just
Speaker 1: to kind of frame up this conversation. So for a
Speaker 1: lot of people probably have never heard of Austrian economics
Speaker 1: we were talking about before we're recording that. I have
Speaker 1: many people that I know that have gotten degrees some
Speaker 1: level of degrees in economics from American universities and have
Speaker 1: never even heard of Austrian economics. So you kind of
Speaker 1: said it in a second ago, Austrian economics kind of
Speaker 1: worked on human action. So kind of frame up maybe
Speaker 1: as best as you can in a simple frame of
Speaker 1: what Austrian economics is good.
Speaker 4: Let's put a contrast on like mainstream economics right now.
Speaker 4: Their methodology how they try to find truth is by
Speaker 4: creating models, often very very niche models, and then those
Speaker 4: models make predictions and if those predictions adhere to the
Speaker 4: data that they see in the world, then that is
Speaker 4: a good theory. It's completely void of like a deeper
Speaker 4: like theoretical framework whereby the Austrians looked at human behavior
Speaker 4: and just deduced a network of like really straightforward assumptions
Speaker 4: about that human behavior and use that as a framework
Speaker 4: to analyze complex interactions within society. It doesn't have to
Speaker 4: be just economically, it doesn't have to be just in
Speaker 4: the marketplace, but just how human beings behave for one another,
Speaker 4: because you can have all kinds of different forms of
Speaker 4: like non monetary trade. So what does that mean so
Speaker 4: human beings act? That's like one assumption at the beginning.
Speaker 4: What can you all pass out of that? Meaning action
Speaker 4: means has to come through time because action needs to
Speaker 4: be through time, Like if it's in the past, you
Speaker 4: cannot take action in future.
Speaker 3: You can't. You can only do planning.
Speaker 4: So you have time, and then like why would we
Speaker 4: take action because there's some sort of uneasiness, Like if
Speaker 4: we were perfectly happy right now, like completely in bliss,
Speaker 4: there would be nothing that we need to do.
Speaker 3: However, like you have goals, you want to get more
Speaker 3: people to listen to this.
Speaker 4: You want to make more money, more sponsorships, you want
Speaker 4: your wife to be happier, family, all of these goals
Speaker 4: are there, and we need to work towards that. If
Speaker 4: everything was perfect, we didn't need to act. Okay, that
Speaker 4: means there's not like abundance, there's actually scarcity. Right, So
Speaker 4: you have the principles of time, you have scarcity, you
Speaker 4: have like human action, and you can go through that
Speaker 4: list and it's just a really beautiful edifice of ideas
Speaker 4: that you can then take and look at the world
Speaker 4: and then the really cool things like the Austin business
Speaker 4: cycle theory comes out of that, which is, for instance,
Speaker 4: the idea, and then we can make it practical. Okay,
Speaker 4: the wall of time. How do we adjudicate the value
Speaker 4: of time? Because something like a coffee right now is
Speaker 4: worth more to you than a coffee to more right.
Speaker 1: And my first coffee this morning was worth more to
Speaker 1: me than my second cup of coffee.
Speaker 4: Very good, diminishing marginal returns right there, right, But like
Speaker 4: in terms of time, that means, okay, if you want
Speaker 4: to have a coffee right now, you are willing to
Speaker 4: pay like a quote unquote premium compared to tomorrow. Meaning
Speaker 4: if you lend somebody also money means that you won't
Speaker 4: get more money in return, which then the interest rates
Speaker 4: is allocating that. Right, So if you're the price of
Speaker 4: really just time, time, present and future demand of that.
Speaker 4: And so if you have more people that are affluent
Speaker 4: that have produced more value, which means more goods and services,
Speaker 4: more shairs, generable things, that means they can lend out
Speaker 4: more money. That stands for all of these goods and services,
Speaker 4: and other people can use these goods and services to
Speaker 4: invest in the economy. And so if you have like
Speaker 4: a society imagine like one hundred people and all of
Speaker 4: them are just like gamblers and drinkers and like I
Speaker 4: don't know, just like don't care about anything, they would
Speaker 4: not save a lot, meaning you would not have a
Speaker 4: lot of resources to invest, So the interest rate would
Speaker 4: be high. The cost of that of those resources would
Speaker 4: be high. Now, if you have like a prudent society
Speaker 4: of people at saving, then the interestrate would be low. However,
Speaker 4: now we're living in a society where the interest rates
Speaker 4: is determined by people sitting at a central bank, just
Speaker 4: thousands of economists that think that they can set the
Speaker 4: right price of what the cost of for future savings
Speaker 4: should be right, And that's mind boggling really, and that
Speaker 4: has led to all kinds of differ manipulations.
Speaker 3: And that's the last thing I would say here.
Speaker 4: If you think about it, if you ask any kind
Speaker 4: of economists, would you know how to set the price
Speaker 4: of milk or the price of X to more? Or
Speaker 4: would you be would there be negative consequences if you
Speaker 4: set it too low or too high?
Speaker 3: They would say yes.
Speaker 4: But like the price that determines the value of money,
Speaker 4: that impacts every other price in society, they say, sure,
Speaker 4: we have to like say what that is.
Speaker 1: Yeah, there's countless examples of history of price fixing, which
Speaker 1: is kind of one of the last steps that's done
Speaker 1: as an economy is dying, and it always fails. And
Speaker 1: so to your point, we know that empirically, I guess
Speaker 1: you could say, however, when you set the price of money,
Speaker 1: that's what you're doing, and they don't seem to get
Speaker 1: that connection. I want to dig more into that, but
Speaker 1: just for a minute, so you kind of have this.
Speaker 1: It's driven off of human action, which seems so normal
Speaker 1: and so rational, and we understand that humans are irrational,
Speaker 1: and I like coffee black, but tomorrow I might want
Speaker 1: cream in my coffee. And I don't know why, I
Speaker 1: just do right, And so we change if we look
Speaker 1: at the other school thought. And so today I said,
Speaker 1: I have friends that have gone through university and got
Speaker 1: degrees in economics, and they have never heard about Austrian economics.
Speaker 1: And typically it seems like most of the economic channels
Speaker 1: that are being out to the air off of Kinsey
Speaker 1: in economics, I don't know if they really call it
Speaker 1: that anymore. So what is the prevailing school of economic
Speaker 1: thought today?
Speaker 2: Sum that up? And then I want to compare those two.
Speaker 4: Yeah, so the most preventing schools of thoughts, and they're
Speaker 4: blending to some extent to one another, like neoclassical economics,
Speaker 4: which is for instance, like where Friedman comes from from
Speaker 4: that tradition, and I'm a huge fan of Freedman. I
Speaker 4: just don't agree with his methodology, but he comes to
Speaker 4: similar conclusions with different means. And then there's of course
Speaker 4: like Kne's in economics, and this is an interesting insight
Speaker 4: toout history. Like Kanes and hyek Hiak of course.
Speaker 3: Being somebody that represented to the.
Speaker 4: Austrian school, they were actually friend as times, and they
Speaker 4: were talking quite a lot, and Haya gave interviews about
Speaker 4: this and basically said, like, yeah, Kines has no knowledge
Speaker 4: about economics because he just came up with like a
Speaker 4: bunch of new theories. He was very creative, and he
Speaker 4: was just like looking at his one teacher, he never
Speaker 4: went through like history, and he didn't like know the
Speaker 4: economic thinking even like sort of.
Speaker 1: Like they've never gone down to the first principles which
Speaker 1: allows you to then formulate your own ideas off of that,
Speaker 1: and so he kind of grasped on maybe at a
Speaker 1: higher level and started kind of being creatible without really
Speaker 1: understanding the base layer of it absolutely.
Speaker 4: And that was also what really upset Hyek because high
Speaker 4: before the general Theory that Kines wrote, which was like
Speaker 4: the book that made him like really popular and he
Speaker 4: spoke everywhere and so forth, before that book, he wrote
Speaker 4: like a different book. And Haiak went out and attacked
Speaker 4: that book and took it apart, and then like a
Speaker 4: few weeks later, Kane said, like, I'm changing, I'm changing
Speaker 4: my minds.
Speaker 3: That's not what I believe in anymore.
Speaker 4: And so one of the highest biggest regrets was that
Speaker 4: he didn't attack that book later on the next one.
Speaker 3: Yeah, the general theory.
Speaker 4: Which then had like this huge impact, and he really
Speaker 4: regretted that for the rest of his life that he
Speaker 4: didn't do that because he thought like, oh, this guy
Speaker 4: would just change his mind again. That shows you that
Speaker 4: there was not like a really solid foundation there.
Speaker 3: Of course, a lot.
Speaker 4: Of people have derived theories from that, which is a
Speaker 4: very we talked about the humility aspect.
Speaker 3: It's the opposite of it.
Speaker 4: It's a very engineering view of society, just like as
Speaker 4: a system of cox and levers that you can just
Speaker 4: like pull and twist.
Speaker 1: So that's what I wanted to ask you about that,
Speaker 1: that specific piece the cogs. Yes, so it almost I've
Speaker 1: been kind of working on this theory. I did a
Speaker 1: podcast with the Breed Love a couple of days ago
Speaker 1: and we titled it or. I was talking about the
Speaker 1: crisis and confidence and basically how we have these authority figures, doctors, economists, politicians,
Speaker 1: but we're starting to see that there's massive gaps in
Speaker 1: their knowledge and so we're losing confidence in them. And
Speaker 1: I was kind of framing up how and correct me
Speaker 1: if I'm wrong, But here's what I'm thinking. And so
Speaker 1: technology is what changes the world because it changes the
Speaker 1: way that we communicate, organize, work, etc. So, if we
Speaker 1: look at, you know, the invention of the stirrup or
Speaker 1: the invention of the gunpowder revolution, the invention of the
Speaker 1: industrial revolution, and the industrial revolution started centralizing people. And
Speaker 1: then you go into the early late eighteen hundreds, early
Speaker 1: nineteen hundreds, we had the invention of the automobile and
Speaker 1: the assembly line. And so then we go into the
Speaker 1: assembly line and then you and I. You're way smarter
Speaker 1: than me, but we work on the assembly line together,
Speaker 1: and we're both just.
Speaker 2: A cog and a wheel.
Speaker 1: And because we were trying to manage the masses, we
Speaker 1: had to develop a management system to manage the mass
Speaker 1: as cogs in the wheel, so that I don't take
Speaker 1: into account you and your traits and your knowledge or whatever.
Speaker 1: You're just on the assembly line next to me, and
Speaker 1: we're doing the world cogs and wheel. And so we
Speaker 1: created this management system to manage the masses in a
Speaker 1: mass manufacturing process. And then we kind of created a
Speaker 1: government system to manage that industrial mass production cogs and
Speaker 1: a wheel. And we're not in that anymore. We're in
Speaker 1: the information age today. And so like the form of
Speaker 1: government we have today is no longer compatible with the
Speaker 1: world that we live in. But my question back to
Speaker 1: you that that's kind of the quick version of my
Speaker 1: question back to you is do you think that maybe
Speaker 1: had something to do with impacting or influencing Kine's view
Speaker 1: or this kensane economics where they all think of us
Speaker 1: as a cog in the wheel. Maybe that where we
Speaker 1: were in society at that time, in the Industrial Revolution, etc.
Speaker 4: That's very fascinating, and you laid it beautifully. I would say, initially, yes,
Speaker 4: for sure one question maybe you can get put like
Speaker 4: a pin in there. But like you said, that technology
Speaker 4: drives society, and I think that's an interesting debate there.
Speaker 3: Is it technology or.
Speaker 4: Is the ideas that are around those technologically changes that
Speaker 4: maybe influence that.
Speaker 3: But to answer your question errectly.
Speaker 1: What technology is a solution and a solution should come
Speaker 1: to a problem. Yes, so to your point, society has
Speaker 1: a problem and the technology supposed to solve that, but
Speaker 1: then it does change society correctly.
Speaker 4: The reason why I'm pushing slightly back against that is
Speaker 4: because that is also like how I'm not accusing you
Speaker 4: of anything, but like that's also like how Marx actually look.
Speaker 3: At the darker professor. Please, No, I'm not a professor.
Speaker 3: I'm just I'm a practitioner. I wish I could like
Speaker 3: spend more time on idea. So I enjoyed this chat
Speaker 3: very much.
Speaker 4: But like they were thinking, like, Okay, the technological change
Speaker 4: is what determines history. It was a very deterministic view.
Speaker 4: So and that's exactly how you were saying that. And
Speaker 4: I'm not denying that technology has a huge impact on
Speaker 4: this and that it requires a lot of different changes,
Speaker 4: but I think it's mostly like, for instance, the ideas,
Speaker 4: because the industrial could have happened not only in the
Speaker 4: Netherlands and in the UK, it could have happened in
Speaker 4: many other places. They had like similar conditions. The question
Speaker 4: is why. And I think that comes back to questions
Speaker 4: like what kind of values the people have, like for instance,
Speaker 4: like being pool and being saving, thinking about tomorrow, like
Speaker 4: building homes, building cathedrals and so forth, and thinking like
Speaker 4: further ahead, and then technology.
Speaker 1: Natural human drive for ingenuity and efficiency, and like that's
Speaker 1: human creativity.
Speaker 3: Correct.
Speaker 4: So I think your point is one hundred percent correct.
Speaker 4: I just want to embed it in like in a
Speaker 4: slightly different context, but like going back to your question,
Speaker 4: which is a really fascinating one. I think you're right
Speaker 4: because we human beings are also not really equipped to
Speaker 4: handling complexity very well, right, Like our brain is involved,
Speaker 4: and like I think there's studies on that that shows
Speaker 4: that we can only keep like one hundred and fifty
Speaker 4: like close issue relationships at any given point in time.
Speaker 4: Because that's like how typically the largest size of the
Speaker 4: types were you know, and now you think about, like, okay,
Speaker 4: how can you even imagine how like an iPod or
Speaker 4: like an iPhone is being produced with like the millions
Speaker 4: of different pieces in there, Like nobody knows how to
Speaker 4: produce that, and like everybody talks about like nobody knows
Speaker 4: how to produce like a simple pencil. If your audience
Speaker 4: hasn't read the book, they should definitely read eyepencil. It's
Speaker 4: such a beautiful explanation that nobody really knows what goes
Speaker 4: into that. Do you have to think about the chainsaws,
Speaker 4: about the rubber and like the chemical composition the metal,
Speaker 4: you know, the lead, all that kind of stuff, and
Speaker 4: that's just mind blowing and thinking about all of these
Speaker 4: different steps is very hard for us. But theoretically we
Speaker 4: should all go into supermarket, right and just being like
Speaker 4: blown away. Why we can take like a like a
Speaker 4: can of soup for like seventy cents or because of inflation,
Speaker 4: probably like two dollars right now, and.
Speaker 3: Take that out and like we don't die.
Speaker 4: That's a freaking miracle, right, But we cannot really fathom
Speaker 4: that complexity and how many millions of people have worked
Speaker 4: together to make this like working. And I think that
Speaker 4: is something that most people cannot handle. And therefore most
Speaker 4: economists also they're just humans and therefore or like, it's
Speaker 4: much easier to think, Okay, what's the problem unemployment, what's
Speaker 4: the solution. We just spend a bunch of money. Money
Speaker 4: in hand of people leads to people buying mo soup.
Speaker 4: Therefore there will be more people that benefit from that,
Speaker 4: and then un employment goes high up and then be good.
Speaker 4: And every problem that you see as from that perspective,
Speaker 4: a status perspective, or as an engineering perspective or government perspective,
Speaker 4: you see all of these problems in society, and you
Speaker 4: have all of these just problematic nails, and you have
Speaker 4: like one hammer which is just like forcing people in
Speaker 4: that direction. But society is way too complex to do that,
Speaker 4: and that has a negative.
Speaker 1: Consequence the complex system. And so in a complex system,
Speaker 1: you can't just treat one symptom. You have heartburn, the
Speaker 1: doctor gives you a heartburn medication, and then it creates
Speaker 1: all these side effects inside your body. Right, as opposed
Speaker 1: to think and so the same thing, right, unemployment, Okay,
Speaker 1: what do we do, Well, let's print money. But yeah,
Speaker 1: I just I'm often thinking about, you know, these kinds
Speaker 1: in economic kind of viewpoints, where again like they look
Speaker 1: at society as just cogs in a wheel or number
Speaker 1: of zeros and ones on a spreadsheet, as to understand,
Speaker 1: these are humans and they're irrational, and they do things
Speaker 1: based off of lots of different incentives. And so I
Speaker 1: always wonder if it just to me, it just seems
Speaker 1: idiotic and it's interesting.
Speaker 4: He knees also himself, and you can speculate about it.
Speaker 4: I don't know, it's just like an interesting tidbits for history.
Speaker 4: He seemed to have like a very high time preference.
Speaker 4: Life time preference comes also from the Austrian school mostly
Speaker 4: which basically says like, hey, if you're looking forward in
Speaker 4: your life too, I don't know, safe in bitcoin and
Speaker 4: save for the future because you want to have a
Speaker 4: family at some point, and you're not spending as much
Speaker 4: like on a like a Ferrari now and you're saving
Speaker 4: for the future, or you don't go out for bers
Speaker 4: right now because you want to save. That's like a
Speaker 4: low time preference, like you have a preference more for
Speaker 4: the future than for today, even though you need to
Speaker 4: eat today. High time preference is the opposite. Canes had
Speaker 4: a very high time preference life. He was like traveling
Speaker 4: a lot and partying, and there's all kinds of different
Speaker 4: other rumors about like high time preference behavior that he
Speaker 4: might have had today living for today. Maybe that also
Speaker 4: played in that because at the end of the set,
Speaker 4: like set to Hiak, in the long run we all
Speaker 4: did right. He doesn't care about like maybe debt going
Speaker 4: higher up, or maybe inflation is going to pick up,
Speaker 4: because right now the pain of the people is that
Speaker 4: they're unemployed because there was a prosession or whatever, and
Speaker 4: government needs to fix it now.
Speaker 1: I think it's easy to understand why governments today want
Speaker 1: to latch onto kins in economics and want to get
Speaker 1: rid of any Austrian viewpoint one side bit and you
Speaker 1: can correct me if I'm wrong, But it seems that
Speaker 1: we've gone way further than Keens that ever wanted things
Speaker 1: to go. He did it. You know, we should have
Speaker 1: some easing and you know, smooth out on the cycles.
Speaker 1: But I don't think he ever intended for things to
Speaker 1: get where they are.
Speaker 4: He said, you just safe if you have like more
Speaker 4: income and like inflation is low, you should actually be
Speaker 4: saving what government doesn't.
Speaker 2: Do that, and so he wanted to kind of.
Speaker 1: Bring government easying up and down with the time, save
Speaker 1: in the good times, you know, ease and the bad times,
Speaker 1: et cetera.
Speaker 2: And so yeah, we've gone way past that.
Speaker 1: But I think it's easy to understand why the governments
Speaker 1: want to adopt that mentality or that ideology because they
Speaker 1: want to print and they want to continue to give
Speaker 1: more free stuff so they can continue to stay in power,
Speaker 1: and so they don't want to hear, oh we have
Speaker 1: to live on a budget austerity. We don't want to
Speaker 1: live off of our savings. So that seems to be
Speaker 1: probably the main viewpoint as to why they've adopted this,
Speaker 1: pushed it and kind of hidden Austrians, would you agree
Speaker 1: with that?
Speaker 4: I think that's part of that absolutely. Why else would
Speaker 4: Another reason was physics envy, so Austin economics. Of course
Speaker 4: it does statistic analysis, it looks at historical examples. However
Speaker 4: it doesn't say that we can predict the future. Austrians
Speaker 4: are again as SPECIs we said before, they're humble about
Speaker 4: what they can do in society, yeah, right, and what
Speaker 4: can be accomplished. So they don't say like, hey, we
Speaker 4: can come up with like this great theory and we
Speaker 4: will fix everything in the world.
Speaker 3: They never would say that.
Speaker 4: Now, during the nineteen twenties thirties, like Austin economics was mainstream. However,
Speaker 4: then more and more math and physics envy came part
Speaker 4: of the social sciences where they tried to really predict
Speaker 4: more human behavior. And that was like one of the
Speaker 4: main reasons why like neoclassical economics, even though they had
Speaker 4: like ludicrous assumptions often about like what people are and
Speaker 4: how they act, so for instance, have like full information
Speaker 4: now exactly what the prices are, like all of these
Speaker 4: things that go into like the basic models of neoclassical theories,
Speaker 4: even though.
Speaker 3: It's not really true.
Speaker 4: They could use that to build math around it and
Speaker 4: then predictive models around it, and often they don't break down.
Speaker 4: But it led also to the what they call the
Speaker 4: balcanization of social sciences, where everybody is in their like
Speaker 4: very little nook.
Speaker 3: So for instance, if.
Speaker 4: You talk to like a healthcare economist, right and then
Speaker 4: try to talk with them about like labor theory, they
Speaker 4: wouldn't be able to understand one another. And that just
Speaker 4: shows you that while there might be some merit on
Speaker 4: the margin on some of those things, it has gone
Speaker 4: way past that.
Speaker 1: And that's the problem because now they're all specials in
Speaker 1: the little area, but without understanding the full complex system.
Speaker 1: I just read a report just as I think it
Speaker 1: was this week, and it was it was a report
Speaker 1: and a study that was done in the medical system
Speaker 1: and talking about how all these specialist doctors and how
Speaker 1: far apart they are from understanding the other pieces in there.
Speaker 1: So like you're a liver doctor and you're the best
Speaker 1: liver doctor in the world, but you don't really understand
Speaker 1: how the liver corresponds with the kidneys and whatever the
Speaker 1: other organs, and so same in the medical establishment, we're
Speaker 1: kind of seeing the same thing. If the if the
Speaker 1: Austrian school doesn't try to predict based off of their models,
Speaker 1: then they're more just observing and what's the point of that.
Speaker 4: They're doing something that's called pedun predictions. So they're just
Speaker 4: saying like, hey, if this generally happens, this is the effect. So,
Speaker 4: for instance, if you have like one market and it's
Speaker 4: like let's call it the German like, let's call it
Speaker 4: the potato market, right, and then suddenly there, yeah, there's
Speaker 4: a shock to the system for whatever, like there's like
Speaker 4: potato bugs and whatever, and then like thirty percent of
Speaker 4: the supply is gone. They will say like, hey, this
Speaker 4: typically will lead to an increase in prices of potatoes
Speaker 4: because they're scarcity. And they can show that logically by
Speaker 4: like a link of like all of these things from
Speaker 4: the very assumptions of human beings act in order to
Speaker 4: resolve uneasiness. They can everything logically deduct to that statement,
Speaker 4: and that is one hundred percent two. However, you can
Speaker 4: imagine in a world that suddenly there is like a
Speaker 4: potato innovation happening, or like another country comes in and
Speaker 4: supplies like they have like very overproduction for whatever reason
Speaker 4: and put it on the.
Speaker 3: Market and the price maybe stays the same.
Speaker 4: Yeah, would you say that the theory is wrong that
Speaker 4: typically if supply collapses, the price would go up.
Speaker 3: Hell no, you wouldn't.
Speaker 2: You know.
Speaker 4: That's also like another difficulty if you're having your whole
Speaker 4: epistemic theory only focused on prediction, that that will get
Speaker 4: you into problems because, as we've said, complex situations would change.
Speaker 4: There's new things coming in into the system that you
Speaker 4: cannot really foresee.
Speaker 1: But that's all like lagging information as well. Whereas Kinsians
Speaker 1: or whatever, we're classic neo economists or whatever, they're trying
Speaker 1: to predict, and not just predict but create the future.
Speaker 1: M hm. So Austrians don't have that hubris of trying
Speaker 1: to create. They're just observing, saying, hey, you had this
Speaker 1: issue with the potato bugs, and so here's what's gonna
Speaker 1: happen with potatoes.
Speaker 2: What's the point of that?
Speaker 1: Why? Like, I can understand, I don't agree with it,
Speaker 1: but I can understand the Kinsey and viewpoint where like, hey,
Speaker 1: let's let's make sure that we can organize the economy
Speaker 1: so at best it suits everybody and the underprivileged, and
Speaker 1: let's manage this. So I can understand why they want
Speaker 1: to do that. But then why do people want to
Speaker 1: I mean, what's the point of Austrian economics?
Speaker 3: You hit it on the on the head, on the
Speaker 3: nail on the head, because you set yourself. You know,
Speaker 3: why does the elite.
Speaker 4: Or the politicians not want to use this Because Australian
Speaker 4: economists would be useless. Like they could say like, oh,
Speaker 4: this is like probably where it goes in that direction,
Speaker 4: but they could not help to solve like that specific issue.
Speaker 1: They could warn them about all kinds of debatings. They're
Speaker 1: good at warning.
Speaker 4: Yeah, good at warning and saying like, hey, maybe you
Speaker 4: should not do anything because like we know, price system,
Speaker 4: property rights, individual trade, all that kind of stuff that
Speaker 4: will lead to better outcomes because you rely on the
Speaker 4: power of individuals decisions.
Speaker 6: Yea.
Speaker 4: However, like the people powers say like hey, I need
Speaker 4: like a three way that justifies that I can spend
Speaker 4: more money there, and saying like you shouldn't spend more money,
Speaker 4: you should actually like get rid of the Department of Education.
Speaker 4: It's not something that any kind of politician wants to hear.
Speaker 5: Yeah, making a couple of notes, I can come back
Speaker 5: to some stuff here, so I can come back to
Speaker 5: these questions.
Speaker 1: So let's let's go back to the technology changing things.
Speaker 1: And to your point, everything starts as an idea of course, right,
Speaker 1: And so typically we have a problem, humans have a
Speaker 1: problem that we want to solve. I want it easier
Speaker 1: to kill an animal, so I come up with a
Speaker 1: way to make a spear or whatever. Right, So it
Speaker 1: starts an idea, there's a want, and then it's an idea,
Speaker 1: and then we're creative beings. So then we create a
Speaker 1: solution to that. But then a lot of times those
Speaker 1: new technologies that we created then go change the world.
Speaker 1: So back to like the gunpowder revolution, Right, you had
Speaker 1: a stirrup and how a guy and a horse could
Speaker 1: now control hundreds of peasants. But then a gun pow
Speaker 1: of revolution. Now one guy with a gun could take
Speaker 1: out one hundred nights. Yes, and so like that changes
Speaker 1: the world. Or we had the farm and cottage industry,
Speaker 1: but then the industrial eolution brought people into cities and factories.
Speaker 1: A chicken or the egg argument or whatever, but it
Speaker 1: does change things. And so now we have another what
Speaker 1: I think is another technological revolution, decentralization.
Speaker 2: We'd call it that.
Speaker 1: Bitcoin is this decentralized network. Now we could sit here
Speaker 1: and I'm sure you have and I have as well,
Speaker 1: talked about all the ways we can see bitcoin changing
Speaker 1: things because it will change the way that we organize, communicate,
Speaker 1: It'll change incentive structures and all those things. But it
Speaker 1: came as a problem as there was a problem, and
Speaker 1: so Sotoshi put chance on a brink of another bailout.
Speaker 1: So it was kind of created as this way to
Speaker 1: have ability to have money that's not inflated, and so
Speaker 1: there's lots of things that can do. Going kind of
Speaker 1: back to where we had originally started talking about liberty,
Speaker 1: it said and a tweet, bitcoin is the single best
Speaker 1: shot at achieving liberty in our lifetime. So now we've
Speaker 1: kind of framed up economics, we've framed up liberty. We're
Speaker 1: here at a bitcoin conference. We're recording this at the
Speaker 1: Bitcoin conference in Miami right now, twenty twenty three. So
Speaker 1: what does that mean? How is bitcoin the single best
Speaker 1: shot at achieving liberty in our lifetime?
Speaker 4: It goes back to like what were you were challenging
Speaker 4: at the beginning, like the value for instance of like academics,
Speaker 4: because academics think they understand the world, they know everything,
Speaker 4: and they can like change the world, and that everybody
Speaker 4: wants that, right, But I think like bitcoin is fundamentally
Speaker 4: humbling in that sense right, because it is, in my opinion,
Speaker 4: it's the only true way of achieving liberty in our lifetime.
Speaker 3: And why do I think that even though we have.
Speaker 4: All of these the it's the awesome economists, we have Freemen,
Speaker 4: we have Bastiad, we have Thomas Soul, all kinds of
Speaker 4: great thinkers, but there's still the majority of people out
Speaker 4: there like either don't care or they think like, okay,
Speaker 4: government is necessary for like a whole slew of different things. However,
Speaker 4: bitcoin is circumventing all of that because this is something
Speaker 4: that cannot be stubbed. People can voluntarily opt in. Nobody
Speaker 4: can really disallow it. And if more and more people
Speaker 4: opt into that system, they will realize and understand what
Speaker 4: the problem with fiat money is. And I believe to
Speaker 4: be Fiat money money, which is like by force, the
Speaker 4: creed upon us that we have to use, is the
Speaker 4: reason why government can grow infinitely if they wanted to.
Speaker 3: I mean not infinitely. I mean there are some barriers.
Speaker 2: Course of all their power as long as it works exactly.
Speaker 4: So if you take that away, and if you give
Speaker 4: people actually an alternative that's like.
Speaker 3: A it's a safety boat.
Speaker 4: It gives you like a new opportunity to opt out
Speaker 4: of a system that otherwise would wipe you out. And
Speaker 4: we notice right now because I think there's like between
Speaker 4: forty three to forty nine hyper inflations that have happened.
Speaker 4: I mean, for God's sake, like it happened in the
Speaker 4: binary public as well, and still to this day it
Speaker 4: is in the psyche of people that Germans like save
Speaker 4: more because have realized that and then put it like
Speaker 4: into heart occurrencies. If you think about like the prospect
Speaker 4: of everything that you've worked for in your life within
Speaker 4: just a few years being wiped out, as it just
Speaker 4: happened with the argentinaan So it's happened right now with
Speaker 4: the people in Turkey and in Venezuela of course.
Speaker 2: Like that's yeah.
Speaker 1: So when you say biitcoin is the single best shot
Speaker 1: at achieving liberty in our lifetime, so then that would
Speaker 1: then say that based off of your explanation of that,
Speaker 1: then government may be the single greatest threat to our liberty.
Speaker 3: I would say so, yes, So.
Speaker 1: If government is the single greatest threat to our liberty,
Speaker 1: and then bitcoin can somehow insulate us or isolate us
Speaker 1: from the threat of liberty from the government.
Speaker 4: Because government cannot grow as much as it can right
Speaker 4: now because of all of the money supply, and most
Speaker 4: people don't even realize. And I think you're doing fantastic
Speaker 4: job on your show explaining like all of these different
Speaker 4: mechanisms how that works, because like how do they print
Speaker 4: money because they're buying government debt, right, And how do
Speaker 4: they buy government debt? They just press like a button
Speaker 4: and then there's money out of thin air, and then
Speaker 4: they're by government dead and so it also and then
Speaker 4: who's dealing with that.
Speaker 3: That's the banks, and.
Speaker 4: That's what they have on their balance sheet as like
Speaker 4: the most secure asset, which if you think about it,
Speaker 4: if it's backed up and nothing, it cannot be secure
Speaker 4: by definition. However, it is unfortunately the world that we're
Speaker 4: living in. And if you take that away, then maybe
Speaker 4: you still have government. However, they would have to handle
Speaker 4: business in the same way as.
Speaker 3: You and I.
Speaker 4: They would have to save, they would have to allocate
Speaker 4: like where they spent, and they couldn't just like if
Speaker 4: they had to issue that they need to have somebody
Speaker 4: actually paying that debt. And if nobody is giving them money,
Speaker 4: then they would not be able to spend anymore. And
Speaker 4: they would go bankrupt and then you would have like
Speaker 4: another government potentially coming up and being better run. Right now,
Speaker 4: there is no and we can talk about the banking
Speaker 4: system as well, there's no checks and balances on the
Speaker 4: system anymore.
Speaker 3: Of course you have the constitution, there's no consequence.
Speaker 4: Yeah, there's really little consequence, especially in banking right now.
Speaker 3: People say like, oh, yeah, that's like that's.
Speaker 4: The epitome of like neoliberalism and all that kind of stuff.
Speaker 3: But think about it.
Speaker 4: What where as the competition, the only thing that was
Speaker 4: like a checks on banks was basically that everyone that
Speaker 4: had deposits over two and fifty k would probably not
Speaker 4: be bailed out. So banks needed to be like prudent
Speaker 4: in there, and there many.
Speaker 1: Users retail people had to be prudent as well. Exactly,
Speaker 1: I don't want to go over that limit as well.
Speaker 4: Correct, Now everybody got bailed out. Yeah, and so now
Speaker 4: it's too big to fail. Was in two thousand and eight.
Speaker 4: Now everything is bigger, Everything is failing more, and like
Speaker 4: all of the smaller banks were actually helping to be
Speaker 4: the system, to have the system a little bit more
Speaker 4: bust are getting consolidated in bigger banks.
Speaker 3: So we're just seeing the banks.
Speaker 1: Didn't learn their lesson, nor did the depositors learn lesson.
Speaker 4: I think banks are learning the lesson that they can
Speaker 4: do whatever they want, make a killing out of it,
Speaker 4: and they just get bailed out.
Speaker 1: Well, the banks did go out of business, some of them,
Speaker 1: so SVB. The shareholders they did lose out and so
Speaker 1: the bank owners themselves lost, the shareholders lost, the depositors
Speaker 1: were saved.
Speaker 3: Correct.
Speaker 1: Yeah, is there something in I would imagine in studying
Speaker 1: human human action Astrian economics, there must be something about
Speaker 1: that feedback mechanism of consequence. I mean, we have to
Speaker 1: have consequence. Otherwise, how do we learn right? If I
Speaker 1: don't if I don't burn my hand when I touch
Speaker 1: the stove, how do I learn how to touch a
Speaker 1: stove again?
Speaker 2: Right? And so we need to have that.
Speaker 1: There's something we talked about in the Communists in in
Speaker 1: my book the Uncommonist Manifesto, and how we need to
Speaker 1: reintroduce consequence. So we have a system that allows people
Speaker 1: to move up, but it also has to allow people to.
Speaker 2: Fall back down.
Speaker 1: And so the FIAT system prevents that from happening, prevents
Speaker 1: governments and so they continually make going back to these
Speaker 1: models governments models are wrong every single time, and yet
Speaker 1: they continue to make more wrong assumptions because there's no
Speaker 1: consequence there, there's no feedback mechanism there.
Speaker 4: Right, very true, and this is something that my wife
Speaker 4: Sophie says, and when we talk about like these giky
Speaker 4: ideas which we which we do from time to time,
Speaker 4: she says like, yeah, right now, government is really centralized irresponsibility,
Speaker 4: and what we need to go to is like decentralized responsibility,
Speaker 4: which goes like so well hand in hand and with
Speaker 4: bitcoin again, because it's just like it's your money, it's
Speaker 4: your life's energy that you pull into that, but you
Speaker 4: re sponsor for it.
Speaker 3: If you screw up, you will have to bear other consequences.
Speaker 4: And right now, it's understandable like people want safety, right
Speaker 4: and they just look for the government for those solutions
Speaker 4: that don't see that they can actually produce more agency,
Speaker 4: more opportunity when they empower themselves and their children. And
Speaker 4: that's a scary thought, but that's by basically where we
Speaker 4: are right now.
Speaker 1: Yeah, So you're you have this education platform nonprofit and
Speaker 1: you're and you're helping educate people in these types of
Speaker 1: ideas which sometimes could be kind of a frustrating job,
Speaker 1: you know. I know we talk about in kind of
Speaker 1: this echo chamber of the bitcoin community orange pilling people.
Speaker 2: How do we orange pill people?
Speaker 1: And I always say, well, there's no one size fits
Speaker 1: on answer because everybody is in a different place of location.
Speaker 1: But also, like you know when you had just said earlier,
Speaker 1: kind of waking people up to the ideas or the
Speaker 1: problems of fiat currency, right, they can understand maybe why
Speaker 1: sound money can work. But like in order for if
Speaker 1: you look at like a diffusion of innovation chart of
Speaker 1: how new technologies diffuse out there, right, you have like
Speaker 1: the innovator, the creator, the early adopters. There's a chasm,
Speaker 1: then the early majority, and then the late majority. And
Speaker 1: that chasm is where we cross over where the early
Speaker 1: majority doesn't have to know any of that stuff. So
Speaker 1: the people that use an iPhone today, my kids, they
Speaker 1: don't need to know how the face shows up on
Speaker 1: the phone or even what the internet is. In nineteen
Speaker 1: ninety nine, I started an internet company and I had
Speaker 1: to set up my own server in my own office,
Speaker 1: you know what I mean, Like that was very difficult.
Speaker 1: They don't need to know any of that today, and
Speaker 1: that's like crossing the chasm, and so like the masses
Speaker 1: don't care. Most the masses are ignorant, and the masses
Speaker 1: benefit from the work of the few, right, And so
Speaker 1: maybe the masses never really need to know about fiat currency,
Speaker 1: they never need to know about sound money, but they
Speaker 1: could benefit from the fu of us, the irate minority
Speaker 1: kind of pushing that.
Speaker 2: Would you look at it? Maybe that way.
Speaker 4: I do think that educational efforts and your fantastic show
Speaker 4: is one of that, are important, right, But it's mostly
Speaker 4: people who have already started to question things and want
Speaker 4: to take like ownership and want to like improve their lives.
Speaker 4: I would even say, and we talked a lot about
Speaker 4: the academic ideas and yes I have a PhD. And
Speaker 4: all that kind of stuff, I would say, I have
Speaker 4: very much a bias to action.
Speaker 3: I would say, like, and that's what students liberty is about.
Speaker 4: Like we had last year a little bit over one thousand,
Speaker 4: nine and fifty events with about two hundred fifty thousand
Speaker 4: people attending those events worldwide in one hundred and three countries,
Speaker 4: including Venezuela and the Democratic Republic of Congo, and like
Speaker 4: even California, you know.
Speaker 1: Even California, that's below Africa.
Speaker 3: Have you left yet? You have left?
Speaker 1: No? No, no, I'm still what they call Carmi Fournier,
Speaker 1: people who call it.
Speaker 3: Yeah, maybe soon. It's a great state, for sure.
Speaker 2: I mean I bought a little ranch.
Speaker 1: I got a little ranch in Texas and we got
Speaker 1: some cows and some goats on it, and we're off
Speaker 1: grid with solar and we got a well and all that.
Speaker 2: So I got my bugouts. Buttom building a.
Speaker 1: Place in Mexico right now, beautiful. I'm kind of I'm
Speaker 1: preparing for some exits, but currently California is still pretty nice, man.
Speaker 3: I like that.
Speaker 4: And so while this is great that we had like
Speaker 4: two or fifteen thousand people talk about the ideas like
Speaker 4: you and I talk about, or like philosophy or how
Speaker 4: free markets can help the environment, or whatever the students
Speaker 4: want to talk about, because it's very much bought them up.
Speaker 4: While that is exciting, I care about this number only
Speaker 4: as a proxy for the efficacy, the pain, the failure,
Speaker 4: the success, and the learning of what young people are
Speaker 4: accomplishing behind those numbers, because it's all student driven. So
Speaker 4: for instance, you have like a nineteen year old students
Speaker 4: like inviting a speaker.
Speaker 3: Maybe theyn write like a Mark Moss and it's like
Speaker 3: a big deal.
Speaker 4: They have to write that email and get like nervous
Speaker 4: about it, or like raise money for that event, And
Speaker 4: those are the skills that will show them like, hey,
Speaker 4: I'm not just like a cog in the wheel. I'm
Speaker 4: like somebody that can contribute to society and I can
Speaker 4: produce value. And I'm a product of the organization myself.
Speaker 4: When I was in my young twenties, I raised fifty
Speaker 4: thousand years, started a training program and got to interview
Speaker 4: like all the people that we got as part of
Speaker 4: the program then, and those skills are still with me today.
Speaker 4: It's not my academic pedigrees. I would discount all of that.
Speaker 4: I would say, like, if you go out there and
Speaker 4: just like take action and try things, and yes you
Speaker 4: will fail and learn, but then you will get more agency.
Speaker 3: And that's what I'm excited about. That's what we need.
Speaker 4: We don't have to have everyone understand like, hey, you
Speaker 4: have to like get rid of the federal Reserve. I'd
Speaker 4: rather have everyone understand like you can't take charge of
Speaker 4: your own action. You don't have to look for the
Speaker 4: government or to your parent or whatever. That they solve
Speaker 4: all of your problems and that will lead to millions
Speaker 4: of different solutions that we cannot even envision right now.
Speaker 1: Yeah, we could go on and on and on about
Speaker 1: changing the incentive structure. I mean, there's a million rabbit
Speaker 1: holes we could go down into how bitcoin can change things.
Speaker 1: But seeing as I'm sitting down with a an Austrian
Speaker 1: economists here, an expert subject matter expert in this, I
Speaker 1: have some of the questions I want to ask you.
Speaker 1: And it's something that I've gone round and around around
Speaker 1: with some other people on and if we go to
Speaker 1: something like bitcoin that changes incentive structures and time preference
Speaker 1: and the ability to save and transact and all these
Speaker 1: things that we can go into. But if we imagine ourselves,
Speaker 1: so if we fast forward and we're in that, So
Speaker 1: bitcoin has a fixed supply cap of twenty one million,
Speaker 1: So there's a fixed supply cap, which means it's not deflationary,
Speaker 1: but it's fixed right as opposed to an inflationary monetary supply.
Speaker 1: So as our monetary supply inflates, I think the proper
Speaker 1: terminology I guess maybe would be that as you inflate
Speaker 1: the monetary supply that each unit is worth less, which
Speaker 1: is why prices rise. Our currency buys us less goods
Speaker 1: and services. So in a fixed monetary supply and a
Speaker 1: deflationary environment, the good prices of goods and services would
Speaker 1: be getting less and less and less. But what some
Speaker 1: people have hard time with is two things. One maybe
Speaker 1: I put on a tree whilego. Two of the greatest
Speaker 1: tricks the FED ever pulled on us was one making
Speaker 1: us believe that the money supply has to always expand,
Speaker 1: and two the asset prices are going up. So one
Speaker 1: is people think that the money supply always has to expand,
Speaker 1: and if it doesn't, then credit drives up and then
Speaker 1: or slows wig is constrained, which I think is the point.
Speaker 1: But then maybe we don't get the advancements in medicine
Speaker 1: or technologies that we have seen today. So that's that's
Speaker 1: step number one, So let's talk about that. And then
Speaker 1: the second one we'll frame up is you can't stop
Speaker 1: fractional reserve from happening, and so people are always going
Speaker 1: to create additional mantrainer. So even though bitcoin has a
Speaker 1: twenty one million supply cap, there will actually be more
Speaker 1: because people will create more currency units. So let's talk
Speaker 1: about those two things. So one, if we don't have
Speaker 1: the ability to continue to create this credit system, we're
Speaker 1: on a credit based, debt based system, then how slow
Speaker 1: do does progress grind to a halt time?
Speaker 4: Excellent questions, and most people would believe in those things.
Speaker 4: How you've put them right, But we both see the
Speaker 4: flaws and that sort of thinking, because the flaw is
Speaker 4: that why would you need something to always go up
Speaker 4: in prices? Like why do you have to have a
Speaker 4: stable price system? Even the concept of a stable price
Speaker 4: system doesn't make sense. There's no stable price system.
Speaker 1: Like we talked about earlier, I might pay more for
Speaker 1: a coffee in the morning than I would pay for
Speaker 1: a coffee in the afternoon exactly.
Speaker 4: Or there might be like an innovation within the coffee
Speaker 4: industry and suddenly like the prices are being cut in half, right,
Speaker 4: or the government is printing more money, or like there
Speaker 4: might be millions of different reasons and prices.
Speaker 3: Like the power of prices is.
Speaker 4: Because it is information wrapped up in an incentive. That's
Speaker 4: what the price is, information wrapped up in an incentive.
Speaker 2: So if the.
Speaker 3: Price goes up, that's an indication. Okay, it has become
Speaker 3: relatively scarce, the price goes down, there's more available, So
Speaker 3: there's price is changing all the time for millions of
Speaker 3: different reasons. So why would you want to keep that stable?
Speaker 4: Because the very instability of that system, if you want
Speaker 4: to call it, that are the information that people need
Speaker 4: to receive so that they connect on it. Like you
Speaker 4: and I, we probably don't care about like the price
Speaker 4: of copper all that much, right, but there is millions
Speaker 4: of people that look at the copper markets because it
Speaker 4: affects really their goods and services that maybe potentially very
Speaker 4: down the line affect us.
Speaker 3: So the very concept of keeping it stable makes no sense.
Speaker 4: Point two, I would say the United States had a
Speaker 4: diminishing general price level for I think like a close
Speaker 4: of one hundred of years because it was relatively stable
Speaker 4: because as you've said, the price, like the amount of
Speaker 4: money in society stayed relatively the same and the productivity
Speaker 4: went up. So there's more stuff in society with the
Speaker 4: same amount of money. So the well, the cost of
Speaker 4: the price of the things that I are within society
Speaker 4: has to go down. And why is that a bad thing?
Speaker 4: And why can that not work? We have seen this
Speaker 4: in technology, worst law, like people were questioning it recently,
Speaker 4: but it's stale holds two those far and technology.
Speaker 3: The prices are going.
Speaker 4: Down all the time in some of the sectors of
Speaker 4: all of them. Of course, however, it's super efficient, it's
Speaker 4: super productive, and it made America like still be like
Speaker 4: one of the witchest nations in the world. So we
Speaker 4: have this practical example, and we have the theoretical argument
Speaker 4: of like, there is no stable price system, so what's
Speaker 4: the problem here, And even if we have twenty one
Speaker 4: million bitcoin, and yes it goes as symptotically like there
Speaker 4: will be few and fewer bitcoin with the harpening every
Speaker 4: four years, it doesn't mean that you cannot like live
Speaker 4: on in a bitcoin system with like a few thousand
Speaker 4: sartosis instead of like like ten bitcoin, Like why.
Speaker 3: Would that be.
Speaker 4: It's just like, if it's a gradual exchange and productivity
Speaker 4: rises gradually and the price level goes gradually, that gives
Speaker 4: people the ability to predict and therefore to make entrepreneurial
Speaker 4: decisions about their future costs and the present prices, which
Speaker 4: is completely more predictable than a fear system where you
Speaker 4: have all of these strucks and crises because you just
Speaker 4: flood the whole market with cheap money.
Speaker 1: But I think you're you're highlighting, and this is a
Speaker 1: key piece, is that there's no such thing as certainties
Speaker 1: in life, and we have probabilities, but we also everything
Speaker 1: has like a cost benefit analysis, and so there's pros
Speaker 1: and cons to everything, and so you've highlighted a lot
Speaker 1: of pros. And I would typically kind of flip that
Speaker 1: back as a question to people, and I'd say, well,
Speaker 1: would you rather your money buy you more goods and
Speaker 1: service in the future or less good point and everybody'd
Speaker 1: rather have more.
Speaker 2: And so those are the benefits, Like our life.
Speaker 1: Should be getting easier, we should be working less hours
Speaker 1: to maintain same quality of life. Most peopleould want that. However,
Speaker 1: that would be a pro. But a con and this
Speaker 1: is what I was asking you about, is the con
Speaker 1: would be that I can't get the money I need
Speaker 1: to go design this new drug, and I can't get
Speaker 1: the money I need to go develop the next iPhone
Speaker 1: or the next whatever, because they're not create now without
Speaker 1: this debt based montec system where they're creating this debt
Speaker 1: it contract, you know, restricts the monetary supply, and then
Speaker 1: we don't have the progress. So now how does that
Speaker 1: drug get made, How does that new piece of technology
Speaker 1: get built, how does that new data center or whatever?
Speaker 1: Interesting argument for sure, and people will always say, and
Speaker 1: I'm not gonna of course people always say when people
Speaker 1: always lend, it will always be there, but it could
Speaker 1: really slow progress down.
Speaker 4: I would, then, as you do, like turn back the
Speaker 4: question and say, like, hey, would you weather like invest
Speaker 4: and be an entrepreneur in a system where you, yes,
Speaker 4: you have access to cheap money and therefore you can
Speaker 4: invest more. However, that money is not based on fundamentals.
Speaker 4: There's not like real goods and services behind it because
Speaker 4: it's just paper and like all the individuals printed, there's.
Speaker 1: Always goods and services behind it instead of a different denomination.
Speaker 4: Yeah, and it's like much fewer Like would you be
Speaker 4: like an entrepreneur where it's uncertain, like when that system
Speaker 4: potentially crumbles, versus a system where it is based on
Speaker 4: something real? And I think most people say, like, yeah,
Speaker 4: I want to be based on something real because then
Speaker 4: I can do like more planning, because the thing is like,
Speaker 4: if you don't do that, then you go back to
Speaker 4: the Austin business like a theory that we've talked about.
Speaker 3: Which always ends in the same boom and bust exactly.
Speaker 1: And so maybe in like the tortoise and hair analogy,
Speaker 1: the boom bust the Kinsian cycle grows way faster, but
Speaker 1: boombus boom bab boom busts, and maybe a slower growth
Speaker 1: ends up in the same location at some point.
Speaker 3: And I would say it's it's hard to tell.
Speaker 4: Like and also as a petun prediction, I would say, like,
Speaker 4: it's very interesting to think about, like our people more
Speaker 4: capable to be productive in an environment that it's like
Speaker 4: more inherently predictable instead of like cheap money versus like
Speaker 4: having cheap money. And then like the boom bust cycle,
Speaker 4: it's a very interesting question. I would say, it's more
Speaker 4: sustainable for sure if it's like more predictable and therefore
Speaker 4: like based on something real compared to something imaginary.
Speaker 1: So the trade off is, would you rather have a
Speaker 1: system that gives you the money to go create this
Speaker 1: new drug or this new technology to have this progress
Speaker 1: and growth knowing that the trade off is a destruction
Speaker 1: of society MM.
Speaker 3: One point, or like let's try to make it even,
Speaker 3: like so you.
Speaker 1: Have the good of progress and growth, but you have
Speaker 1: the bad destruction of society and break down a family
Speaker 1: and it's and all the other stuff that happens there.
Speaker 3: And some people might say like, oh, that's going to
Speaker 3: be tomorrow. I'll take that. It's going to be alive.
Speaker 4: Yeah, eh, But like then let's maybe make it a
Speaker 4: little bit more tangible because like often these concepts and
Speaker 4: like concepts like government, they're so aggregated, right, and it's
Speaker 4: trying to bring it down a little bit. That's what
Speaker 4: Austrians are also pedagogically speaking. If you want to understand economics,
Speaker 4: it's like so much better because you understand what's going
Speaker 4: on and then you can tackle more complicated stuff.
Speaker 3: But let's say like.
Speaker 4: Ask the same question, like do you want something that's
Speaker 4: like a little bit more predictable or do you want
Speaker 4: like access to like cheaper money right now? If you
Speaker 4: ask that to somebody that for instance, creates automobiles and
Speaker 4: say like, hey, do you want to like live in
Speaker 4: a in a world where you don't know if the
Speaker 4: supply of steel is actually the supply of steel that
Speaker 4: you're working with right now or it might be like
Speaker 4: thirty percent different tomorrow, Because that's what you're actually saying,
Speaker 4: because the money stands for all of these goods and services,
Speaker 4: and they would say, like, hell no, only.
Speaker 1: Because it's like so much negative that's the cost.
Speaker 3: That's the cost.
Speaker 2: Yeah, but does the cost out weigh the benefit?
Speaker 3: Right?
Speaker 4: But in that example they would see like that the
Speaker 4: that the costs are like much higher than what they
Speaker 4: had thought they were quick exactly, but yeah, it's.
Speaker 1: So we don't know. This is where theory just comes
Speaker 1: in and we're all just making assumptions in the future.
Speaker 1: And I would I'm a bitcoin obviously, and so I
Speaker 1: would agree that I think I would rather have a slower,
Speaker 1: more predictable growth world. I wouldn't want to trade off
Speaker 1: all the damages done to society for potential of more growth.
Speaker 2: But it's certainly something to think about.
Speaker 4: If I may jump in there, and going back to
Speaker 4: the military point, like maybe I'm completely wrong, And Austrians
Speaker 4: would say, like, maybe I'm completely wrong, but like why
Speaker 4: then we don't have like a competitive system. Maybe your
Speaker 4: system then like let's just assume like ye, it will
Speaker 4: be cheap money in a volbal fast and then you
Speaker 4: have like my system where it's like more where people
Speaker 4: decide themselves amongst themselves what the interest rates need to
Speaker 4: be because of you know, the human action.
Speaker 3: And then's see how it works.
Speaker 4: But the peculiar thing is always with these ideas of
Speaker 4: big government or socialists and so forth.
Speaker 3: They don't like the competition.
Speaker 4: Yeah, the FIAT money is a problem because not inherently,
Speaker 4: but because there's they don't alone any kind of other competition.
Speaker 1: You can't you can't allow Caitlin Long.
Speaker 3: If they think it's better, they should.
Speaker 1: Yeah, if you start Kaitlin Long, she tried to launch
Speaker 1: that Custodia Bank and the FED shut it down. It
Speaker 1: could it's gonna be a full reserve bank. And there
Speaker 1: was another one. I forget now what it was. There's
Speaker 1: another bank that tried to picture a full reserve bank
Speaker 1: and they also got denied. And you know, some of
Speaker 1: the thought process the FED hadn't said this obviously, but
Speaker 1: some of the thought processes. They don't want to allow
Speaker 1: a full reserve bank because it will destroy the banking system.
Speaker 1: Everybody will want to go to that maybe maybe not
Speaker 1: you know, maybe, but but that they're afraid of the
Speaker 1: competition because we don't want that.
Speaker 3: Okay, but that's an interesting point.
Speaker 4: Because of the faction reserve banking, I would just say, like,
Speaker 4: let the market de side, like many Austrians one hundred percents,
Speaker 4: but some of them are not, Like I'm like more
Speaker 4: in the not category because like I always like to
Speaker 4: give an example, we know that, for instance, airlines are
Speaker 4: selling more seats than they have on a plane. Right,
Speaker 4: that's fection reserve if they have like big data, right,
Speaker 4: and they know that typically like whatever, it is, like
Speaker 4: three percent of the people that have a ticket don't
Speaker 4: show up. Is this a bad business practice to do?
Speaker 2: Is this fraud?
Speaker 4: Because like most people who don't get on an airplane,
Speaker 4: they get like thousands, thousand of dollars and typically they
Speaker 4: like incentives, they're able to move people around, but it's
Speaker 4: generally better for them to fill out the planes that way.
Speaker 4: Is that like a fraud the system? I wouldn't say
Speaker 4: it is, but some people say it is. But like
Speaker 4: why don't let that compete? And some people that probably
Speaker 4: like me a little bit more risktaking, I say, like
Speaker 4: I'm okay with putting some of my money in a
Speaker 4: faction reserve bank, not like zero percent fractional reserve or
Speaker 4: two percent, but maybe it's like ten.
Speaker 2: Percent, but you can decide.
Speaker 1: So, hey, exactly, I'm at a fifty percent and I
Speaker 1: pay you fifteen percent. He's at a thirty percent and
Speaker 1: pays you twelve percent, And now you can choose which
Speaker 1: one you want, how much risk you're willing to take
Speaker 1: if there was some transparency and you can quantify that
Speaker 1: risk correct And yeah, so I would certainly be for
Speaker 1: a competition. That's how we find out what works exactly. Okay,
Speaker 1: So then the answer is for that is maybe we'd
Speaker 1: have less progress and growth you think the trade would
Speaker 1: be worth it for the stability of the prices and
Speaker 1: so forth.
Speaker 3: I'm not even sure we would have less.
Speaker 4: I mean maybe in a short one, but like in
Speaker 4: the medium to long run, I think like a purely
Speaker 4: free market based system where you have solid pricess systems
Speaker 4: and people are interacting with it, I think that will always.
Speaker 1: Because right now, like if my landscaping businesses is growing
Speaker 1: really really fast, my neighborhood is booming and we need
Speaker 1: more landscaping services, I can go down and buy five
Speaker 1: new trucks on credit, and then I can hire five
Speaker 1: crews to go work around those, and I take on
Speaker 1: a few thousand dollars of debt, but it brings me
Speaker 1: fifty thousand dollars of revenues. That works really good for me,
Speaker 1: and then all the downstream effects of those five trucks.
Speaker 1: So back to the pencil, right, so the manufacturers and
Speaker 1: the vendors and blah blah blah. Right, So how much
Speaker 1: growth came because I was able to get a loan
Speaker 1: for five trucks. Now, if I had to save, it
Speaker 1: would take me my lifetime to get those five trucks.
Speaker 3: Very interesting points.
Speaker 4: I like that, and I a preshiate you pushing back because,
Speaker 4: like often many everybody agrees with everyone. I think there's
Speaker 4: an empirical answer that question. I don't have the data
Speaker 4: in front of me, but like one could look at
Speaker 4: how do society's economies compare that have like relatively stable
Speaker 4: and and like lower or like higher interest rates versus
Speaker 4: economies that have like very lower interest rates and lending. Yeah,
Speaker 4: and over like a period of time. Right, you can
Speaker 4: compare them.
Speaker 1: Well, you would look at lots of other countries that
Speaker 1: don't have accessible credit and look where they're at on
Speaker 1: the progress scale. So I told you I'm building a
Speaker 1: place in Mexico.
Speaker 2: That's a cash thing.
Speaker 1: Yeah, and look at Mexico compared to the United States, Right,
Speaker 1: and so those countries that don't have easy credit markets
Speaker 1: look a lot.
Speaker 4: Different, correct, And it's also like whier economies that have,
Speaker 4: for instance, are dollar wised because they have been through
Speaker 4: like a period of hyper inflation or like completely when bankrupt. Right,
Speaker 4: why do they tend to be better than countries who
Speaker 4: are not dollar wise in the same system. I mean,
Speaker 4: they're giving up a lot of power and it's really
Speaker 4: bad for them, right because they're just like eating up
Speaker 4: the inflation of like the bigger the United States, but
Speaker 4: in the grand scheme of things on dollar and like
Speaker 4: how much dollars I want it doesn't matter really, But
Speaker 4: like why are they more stable than like where economies
Speaker 4: where they have actually control all the money supply. But
Speaker 4: you could argue like, hey, they're not as sophisticated and
Speaker 4: they're like further down like in the ABYSS compared to
Speaker 4: like maybe the United States right now some other countries
Speaker 4: where you can play that game a little bit longer.
Speaker 4: So just about like it's just a tough question to ask,
Speaker 4: like how much you know, emphetamine do.
Speaker 3: You pump into your system?
Speaker 2: Yeah?
Speaker 3: Yeah, until it's like becomes really a problem. Yeah yeah,
Speaker 3: I said, like yeah, maybe you don't want to do
Speaker 3: it in the first place.
Speaker 1: Yeah, okay, So then the next part of that question,
Speaker 1: which is on a fixed money supply twenty one million,
Speaker 1: and then talking about the fractional reserve system that we have.
Speaker 1: You know, some would argue that there's no way to
Speaker 1: keep a twenty one million cap because people will create
Speaker 1: more bitcoin artificially. Like with the gold market, we have
Speaker 1: hundred paper ounces for every one physical ounce, or people
Speaker 1: don't even know how many. There is about one hundred
Speaker 1: to one trade on a daily basis. So how would
Speaker 1: you prevent that I And what does that do to
Speaker 1: the system. People are now creating fraction reserve on top
Speaker 1: of bitcoin or creating paper bitcoin.
Speaker 4: So they will never be able to increase the total
Speaker 4: supply of bitcoin just from the from the code, just
Speaker 4: from Bitcoin core.
Speaker 3: That's not possible.
Speaker 4: I mean they always tried to do that, right because
Speaker 4: like everyone in the system who already owns bitcoin and
Speaker 4: who's running a note can enforce the code. And if
Speaker 4: the code says like, oh suddenly there's like twenty three
Speaker 4: million or like let's say the double amount, you know,
Speaker 4: you don't want to have a fifty percent haircut on
Speaker 4: your value. So therefore everybody would go against it. So
Speaker 4: just from the game theoretical setup of bitcoin, that is
Speaker 4: not going to happen. However, you're making a different argument
Speaker 4: saying like, okay, like what about fraction reserve.
Speaker 1: Because it would still affect the supply demand fair enough?
Speaker 4: Yes, it probably would, and then there might be like
Speaker 4: more paper bitcoin out there than real bitcoin.
Speaker 1: However, we saw FTX had what one point four billion
Speaker 1: dollars of the bitcoin on their books, but they only
Speaker 1: had one actual bitcoin.
Speaker 3: Wasn't that that drastic? Yeah, that's hilarious, I mean sad,
Speaker 3: but also hilarious. Yeah, set for all of the people
Speaker 3: that invested.
Speaker 1: In that they had paper bitcoin claims.
Speaker 4: Indeed, So I don't consider that potent to be like
Speaker 4: an issue necessarily because we have examples throughout history of
Speaker 4: a system called free banking and that has happened, and
Speaker 4: it just means that there's like as little regulation on
Speaker 4: the banking system as possible. It was never one hundred
Speaker 4: percent free, but like relatively free, and this was for instance,
Speaker 4: happened in China, happened in Canada, happened in Scotland, and
Speaker 4: Scotland happens to be like.
Speaker 2: The best example and the US very free.
Speaker 3: No, No, they did not have that.
Speaker 4: They had like always like really atrocious banking regulations and
Speaker 4: you actually couldn't like open up. There was a huge
Speaker 4: problem for the United States to actually become like Witcher
Speaker 4: because at some point the banking system was so that
Speaker 4: if you had like a regional bank in that area,
Speaker 4: you would not be able to have like another bank
Speaker 4: somewhere else, which then doesn't allow you to diversify, and
Speaker 4: you become like less robust as a bank.
Speaker 1: And because they each have their own currency. So now
Speaker 1: my currency is good in this region with this bank,
Speaker 1: but if I go to a different region, my currency
Speaker 1: is no good or at a massive discount.
Speaker 4: Yeah, that didn't exist so much a little bit. But
Speaker 4: like that is actually a feature, another bug, I would say,
Speaker 4: And that's what free banking is because banks were actually
Speaker 4: allowed to print their own currency.
Speaker 1: And no, but because they weren't allowed to have multiple branches.
Speaker 1: Oh yes, so now they print this currency in New York,
Speaker 1: but then I go to Texas and now it's worth
Speaker 1: seventy percent because that person has to go back to
Speaker 1: New York to redeem it. And so yeah, it's a feature.
Speaker 1: They could print their own currency. But because to your
Speaker 1: first point that they couldn't have multiple branches, that caused
Speaker 1: a problem.
Speaker 2: And then as a side.
Speaker 1: Note, interesting enough, it looks like one of the greatest
Speaker 1: downfalls of that was to your point, they couldn't scale.
Speaker 1: But also they were forced to buy government bonds. What's
Speaker 1: causing the banking collapse today. They bought government bonds.
Speaker 3: To put a weighted beautiful debt.
Speaker 1: It's the same problem anyway.
Speaker 2: That's a side note, but keep going sidey.
Speaker 4: Yeah, So no, that is all very good, good points.
Speaker 4: And so the system was one and we have to
Speaker 4: keep in mind that only because it is has transaction
Speaker 4: costs anything doesn't mean it's it's necessarily inefficient. Right, So
Speaker 4: if you have like different areas where have different currencies,
Speaker 4: that's still still okay, and you will have like exchange.
Speaker 4: Right now, we have like how many different currencies are
Speaker 4: out there, right, like sixty seventy maybe more, probably more?
Speaker 3: Is that efficient or not?
Speaker 4: I mean it's hard hard to tell, Like it would
Speaker 4: be super efficient if you're only like one money.
Speaker 3: Do we want that?
Speaker 4: Hell no, because it will be like super manipulated until
Speaker 4: the ends of time, you know, and it will be
Speaker 4: super bad. So in regard to Scotland though they were
Speaker 4: able through competition issuing money, and of course there were
Speaker 4: sometimes like businesses going going down and there was like
Speaker 4: this checks and balance in the system.
Speaker 3: However, generally people were able to.
Speaker 4: Produce more wealth invest into the future, and the system
Speaker 4: actually through naturally going to like a reserve ratio of
Speaker 4: two percent at some point because there was so much
Speaker 4: trust in the system because they have become so efficient.
Speaker 4: And I see that that is possible again. However, if
Speaker 4: then do we have a bank who is imprudent, then
Speaker 4: it will go bankrupt and then the stakeholders to suffer
Speaker 4: same as today. Right, why should it should be no
Speaker 4: risk in the system, no skin in the game. The
Speaker 4: problem is that we don't have enough skin in.
Speaker 1: The gright, which is the whole reason whying to create
Speaker 1: the FED exactly and prevent banks from going bust.
Speaker 4: Pick the So it's it's not an easy sell, right
Speaker 4: it saying like, hey, you have to take more risks
Speaker 4: or maybe your bank and your life savings go bankrupt. However,
Speaker 4: there's bankruptcy proceedings and all that kind of stuff, and
Speaker 4: many people are making these sorts of risks right now
Speaker 4: by going to Vegas, or by even much much more
Speaker 4: prudent is friving having like a lot of company stock
Speaker 4: and you like investing into a startup and you're like
Speaker 4: one of the first employees there, and like eighty percent
Speaker 4: of your wealth is in that stock and suddenly goes away.
Speaker 4: Should we prevent that now, because that's the engine of
Speaker 4: wealth and prosperity. And it happens to also work with money.
Speaker 4: And I don't see any reason why you have to
Speaker 4: have a centralized production of money about the nationalization of
Speaker 4: money in one of his very short books, and I
Speaker 4: would recommend people to eat.
Speaker 1: That, which goes all the way back to kind of
Speaker 1: what we started talking about, which is the skin in
Speaker 1: the game or the consequence bringing back consequence. So then
Speaker 1: I guess then you're saying that even though we would
Speaker 1: have no more than twenty one million, you think it
Speaker 1: would be most likely that we would have competing banks,
Speaker 1: The would be some sort of fractional reserve. It would
Speaker 1: create more currency units, more bitcoin units, not on the chain,
Speaker 1: on the code, but on paper. There would be more.
Speaker 3: Yeah, so there's a limit to it.
Speaker 1: And then and then would that affect the supply demand,
Speaker 1: the equilibrium or the what happens to the price of bitcoin.
Speaker 1: If they're creating more bitcoin units or claims on bioin, it.
Speaker 3: Would affect the price.
Speaker 4: Yeah, let's say they got they extend the money supply
Speaker 4: by four x, so like we have like eighty four
Speaker 4: bitcoin now, right, and of course ed would. But it
Speaker 4: can only come over time, right because like in the beginning,
Speaker 4: you only trust like banks that you can really verify, right,
Speaker 4: And we have to imagine like a completely different world
Speaker 4: right now, because right now everybody thinks like all of
Speaker 4: the banks are safe, and people think they're putting the
Speaker 4: money in and the money is actually there. Right, try
Speaker 4: to get like fifty thousand they're like even twenty thousand
Speaker 4: dollars from a bank.
Speaker 2: Right now, even five in a lot of banks.
Speaker 4: Yeah, I mean we hear these hory stories not only
Speaker 4: from Canada but also from the United States.
Speaker 1: Have to pre order cash, yeah yeah.
Speaker 4: And most people don't know that they think it's safe
Speaker 4: in there. So bitcoin most likely will only come about
Speaker 4: in a grand feshion after like some big collapse at
Speaker 4: least that's my pattern prediction, that more people opt into
Speaker 4: that and so people will not trust banks. There's like
Speaker 4: no business model coming up hopefully like there will be
Speaker 4: custodian banks that are like one hundred percent, and then
Speaker 4: they will shortly like increase the money supply a little
Speaker 4: bit and because they want to like test how much
Speaker 4: on the risk curve that can go out and it
Speaker 4: depends on, of course, like the risk appetite of the
Speaker 4: customers generally, and then only slowly there will be like
Speaker 4: more and at some point there will be like an equilibrium,
Speaker 4: but it will be not like as rapid and as
Speaker 4: like expansionary and inflationary as the system that we have
Speaker 4: right now where things can come into thing like that.
Speaker 1: Yeah, and then the one big difference of bitcoin is
Speaker 1: that it's it's an open you know, ledger, yes, and
Speaker 1: so we can see what the bank actually has versus
Speaker 1: what the bank has extended, and so then it allows
Speaker 1: us to gauge that risk with transparency as opposed to
Speaker 1: a traditional banking system where we really have no idea,
Speaker 1: and so then it allows that feedback mechanism to happen
Speaker 1: a lot faster. Also, it's a lot easier to just
Speaker 1: take your money out things like that, So I think
Speaker 1: that would greatly change it. I was kind of thinking
Speaker 1: along the lines of what misis framed up as like
Speaker 1: the difference of circulating credit versus commodity credit. So commodity
Speaker 1: credit would be if I grew ten bushels of wheat
Speaker 1: and I sold eight, I could give one of them
Speaker 1: to you on credit, but that came from my savings
Speaker 1: versus circulation credit was creating that credit out of thin air.
Speaker 1: So would you put the fractional reserve banking as like
Speaker 1: circulation credit.
Speaker 4: It's an interesting question, and in the first five minutes
Speaker 4: you presented yourself like as somebody that has not studied
Speaker 4: all of these things as deeply as I am. You
Speaker 4: are really diving into those topics and media understanding those.
Speaker 1: I'm asking questions. Sometimes I get comments on my videos
Speaker 1: like oh that guy owned you, or I'm like, I'm
Speaker 1: just asking questions, Like my goal is to ask questions.
Speaker 1: So but yeah, of course I'll study this. I spent
Speaker 1: a lot of time discussing and thinking about these things.
Speaker 4: And it goes into like the theory of money and credit,
Speaker 4: which is like one of Mes's books where a where
Speaker 4: he like, really dive what dives into that?
Speaker 1: Yeah, I think, and I have my own thoughts to
Speaker 1: these questions. But I'm I want your viewpoint.
Speaker 4: Look, and I really enjoy that because like in my
Speaker 4: day to day, like I'm running a business, like I'm
Speaker 4: hiring people, you know, all these sorts of things, so
Speaker 4: I don't get the chance to, you know, engage into
Speaker 4: like those sorts of intellectual discussions as deeply as we
Speaker 4: are doing right now. So I appreciate that framework that
Speaker 4: you've created. Yeah, I would say, like it's it's probably
Speaker 4: more I mean, it's it's still it's still credit and
Speaker 4: it's still produced out of thin air. However, since bitcoin
Speaker 4: is not something that can be ever you know, reduceed
Speaker 4: to do like extended then more than twenty one million
Speaker 4: bitcoin on like on the chain, there is like a
Speaker 4: natural limit to that, and I think that gives me
Speaker 4: a lot of pause and and you know peace that
Speaker 4: that is not like the biggest issue. However, like I
Speaker 4: don't know, maybe you're d maybe I'm read, I really
Speaker 4: don't know. And that's the beautiful thing. So Moss Bank
Speaker 4: will compare against von lab Bank. You will probably win
Speaker 4: because most bank's not so much better than my last time.
Speaker 3: It's harder to beat. And you already have like.
Speaker 4: A huge audience, like you have a reputation you know,
Speaker 4: and all of that will be and that's that's all
Speaker 4: what it is, like you investing in businesses or you
Speaker 4: go to restaurant because you can check it up on
Speaker 4: the help and people will just like say, like, okay,
Speaker 4: it's marked mores believable and can we trust him with
Speaker 4: our money? And if you can't, then you will go
Speaker 4: out of business. And then it will go back from
Speaker 4: like maybe eighty million into like sixty million bitcoin on paper,
Speaker 4: but like still there will be only twenty one million
Speaker 4: because some people will hold them themselves, which is like
Speaker 4: this revolutionary thing that you can be your own bank,
Speaker 4: which mankind humankind never had access to it before.
Speaker 2: So then we'll we'll round it off with this question.
Speaker 1: So then we maybe don't get as much growth, and
Speaker 1: the cost benefit analysis is probably worth it in your opinion,
Speaker 1: meaning less tear down of society, more predictable future, which
Speaker 1: is what we always want, right, more predictable future, and
Speaker 1: maybe we sacrifice left growth. You might say that we
Speaker 1: might still have the same growth over a different timeframe.
Speaker 1: We would probably have fractional reserve banking, but that would
Speaker 1: be okay because there would be competition and it would
Speaker 1: allow us to pick and choose, and we could test
Speaker 1: different theories out.
Speaker 4: You could probably buy inschouance against like banks like going bankrupt,
Speaker 4: like as you can mention by chewing for most other things, and.
Speaker 1: Then that would offset some of the first problem of
Speaker 1: the growth, because now with fractional banking, you would have
Speaker 1: that the fractional banking that would happen would expand the
Speaker 1: paper supply of bitcoin. And you don't really view that
Speaker 1: as a bad thing.
Speaker 3: Not in itself, No, not in itself, which the first
Speaker 3: probably I'm.
Speaker 4: Pissing off a little bitcoin us by now, But like
Speaker 4: you know, I don't see like again, going back to
Speaker 4: the outline example, I don't see that as inheavenly problematic
Speaker 4: and like flawed, as long as it's managed well in
Speaker 4: competition and having more banks coming into the system will
Speaker 4: be the discipline that the market needs in order to
Speaker 4: and then but then.
Speaker 1: But then by then creating that money and changing the supply,
Speaker 1: the paper supply, but making make sure we're clearing that,
Speaker 1: you know, four six, eight times or whatever, that doesn't
Speaker 1: change the future cost and price.
Speaker 2: Of the money.
Speaker 3: No, it does, it does, of course.
Speaker 1: So now we're back to the first problem, which is
Speaker 1: you said we'd rather have a fixed monitors'pply because you'll
Speaker 1: know what the price of still will be in the future.
Speaker 1: But if we go to a fractional reserve system, now
Speaker 1: we're back in the same proble where we don't know
Speaker 1: what the price of still will be in the future. Yep,
Speaker 1: it's all about So we didn't actually fix anything, Yes.
Speaker 4: We did, because it's it's about like the entrepreneurs always
Speaker 4: like uncertainty, you know, is a premennial effect of life, right,
Speaker 4: and we will never do away with it. Is a
Speaker 4: system better that is like gradually going into one direction
Speaker 4: where the supply of bitcoin is known, where there is
Speaker 4: a limitation on a system being set by the twenty
Speaker 4: one million, or like a system where you have like
Speaker 4: some people in charge they can just say from one
Speaker 4: day to another, we need like ten to ten percent
Speaker 4: more like you know, cheap money into the system. Which
Speaker 4: system is like more predictive and more productive for the
Speaker 4: entrepreneur and for people to make decisions on because prices
Speaker 4: will always change, as you said, like there's no stable
Speaker 4: price level. It's always changing. And as you've said, like
Speaker 4: innovation also will change it a I will probably reduce
Speaker 4: the prices. It's a very deflationary force. But it's it's
Speaker 4: I mean, I don't know how you feel about that,
Speaker 4: but it's a good force generally if it makes us
Speaker 4: more productive. Is that an issue or should we like
Speaker 4: not forbid like should we forbid any kind of other
Speaker 4: you know, innovation because it schools with prices.
Speaker 2: And I think one.
Speaker 1: Big differentiation right there that I was just thinking as
Speaker 1: you're talking, is that if it really came down to
Speaker 1: the free banks making loans, those banks don't want to
Speaker 1: go bust, we have to reintroduce the consequence so that
Speaker 1: means they're only most likely making the majority I say
Speaker 1: the majority of their loans would be product productivity.
Speaker 4: Loans, correct, because if they don't lend it to like
Speaker 4: a business that performs, then you investing badly.
Speaker 1: Right, And so what we one is we want to
Speaker 1: bring more goods and services into the market. And so
Speaker 1: if these banks are expanding the money supply, but they're
Speaker 1: expanding the goods and services faster, otherwise there's a lot
Speaker 1: of business and then we have a deflationary we get
Speaker 1: that money out. So if they're loaning money for productive
Speaker 1: use cases and we're expanding the goods and supplies, faster
Speaker 1: than the money supply. We're a good situation. The problem
Speaker 1: we're in today is the government that's creating thirty one
Speaker 1: trillion dollars worth of money and destroying all the wealth
Speaker 1: and goods and service at the same time.
Speaker 3: Very well said.
Speaker 4: And even if they if they don't do that, it
Speaker 4: means like a lot of money goes to them. And
Speaker 4: that will be by definition, as we know from Means's
Speaker 4: others fantastic book, mess socialism by definition will be invested
Speaker 4: inefficiently and not two ends that are actually productive for society.
Speaker 3: Of course, government can build bridges and can build the tanks.
Speaker 3: However they have.
Speaker 1: No higher private contractors to do that exactly.
Speaker 3: I mean, like I live close to d C.
Speaker 4: Unfortunately, there's a lot of people getting filthy witch on
Speaker 4: all of that stuff. But like, is that what society needs?
Speaker 4: I would say no, because it's not based on like
Speaker 4: the demand and supply of real p it make the
Speaker 4: best decisions with the information that they have in an
Speaker 4: uncertain world compared with like some high end this pie,
Speaker 4: like we need to increase like twenty percent more off
Speaker 4: the money supply, you know.
Speaker 1: Yeah, well I think we'll wrap it up with that
Speaker 1: we covered a lot of ground that was just I
Speaker 1: just I just wanted to ask those questions. Those are
Speaker 1: things I would normally be on your side of the conversation,
Speaker 1: and so I'm just trying to like, these these are
Speaker 1: challenges that people have brought to me, So I just
Speaker 1: wanted to kind of ask that to you. I'd like
Speaker 1: to take these opportunities to try to learn, right, I'm
Speaker 1: trying to learn as well. There's actually something breed Love
Speaker 1: helped me out with where a lot of times I
Speaker 1: was doing interviews trying to kind of serve you up
Speaker 1: softballs and let you kind of get your pitch out
Speaker 1: to the audience or what I thought the audience would want,
Speaker 1: and like I try to, like, man, I'm getting to
Speaker 1: sit down with you, like I should try to, like
Speaker 1: see what I can learn. So I appreciate that students
Speaker 1: of liberty, students students for liberty, where can people go
Speaker 1: to find more about that?
Speaker 4: Well, thank you so much, MOK. And I've also learned
Speaker 4: a lot and like some of the challenges I've not
Speaker 4: heard in a while. And as I've said, like I'm
Speaker 4: like thinking about business all day, I'm reading business books. Yeah,
Speaker 4: now you're bringing me back to like the world. That
Speaker 4: really made me excited about these ideas because they have
Speaker 4: changed my outlook in life and see like how society
Speaker 4: actually functions. Gave me like a different lens to look
Speaker 4: at the world. And that's beautiful that you're helping other
Speaker 4: people to see, like a little bit more clearly what's
Speaker 4: what's going on.
Speaker 3: And I appreciate you for that.
Speaker 4: But yeah, Students for Liberty can be found out students
Speaker 4: liberty dot org. If you're a student yourself, go go
Speaker 4: check out the resources that we have. We have a
Speaker 4: YouTube channel called Learn Liberty with over two and eighty
Speaker 4: five thousand subscribers, a bunch of videos interesting topics like
Speaker 4: the one one here. We should have you at some point,
Speaker 4: by the way, Yeah and yeah, otherwise, just check out
Speaker 4: my Twitter which is at wolf von La.
Speaker 1: What about one last thing, Maybe you have this on
Speaker 1: your website or part of your curriculum through this, through
Speaker 1: through through the program that you have. But I mean,
Speaker 1: I love these books and so I've read, you know,
Speaker 1: some of these books. Myself. Human Action is a book
Speaker 1: that everyone should probably read, but it's so friggin hard.
Speaker 4: And most people don't get past the first time page.
Speaker 4: It was just about epistemology and like you need to
Speaker 4: be like very philosophical to get and like.
Speaker 1: If we could just take that book and rewrite it
Speaker 1: in like a fifth grade level, because that's where most
Speaker 1: books are supposed to be and kind of like a
Speaker 1: fifth grade level, right, if we could just take that
Speaker 1: book and keep the concepts and the theory, but just
Speaker 1: because it was written one hundred years ago in a
Speaker 1: very academic way and they talked a lot more.
Speaker 3: Proper back, very Germanic, with like sentences that do this.
Speaker 1: Long, right, you know, if we can and I find
Speaker 1: myself having to reread a paragraph multiple times, it's the same.
Speaker 1: So if we can just like take that and rewrite
Speaker 1: it in like a fifth grade level. Are there books
Speaker 1: like that? I would would Could you point people to
Speaker 1: a few of those?
Speaker 4: Absolutely? I would say there's a few books that people
Speaker 4: should beat. It's all eye pencil. It's not like even
Speaker 4: the book, it's a booklet. Like that's one thing that
Speaker 4: everybody should read. Then The Use of Knowledge and Society
Speaker 4: by Hyek also like a short article you can also
Speaker 4: read very fast. What is it called the Use of
Speaker 4: Knowledge in Society? That is an article that he's written
Speaker 4: once he received the nobod price and he talks about
Speaker 4: like the price system and how it works, and it's
Speaker 4: it's pretty pretty remarkable. So those two articles go play
Speaker 4: very well together. Then I would say for an American
Speaker 4: audience specifically, but also international audience, What has Government Done
Speaker 4: to Our Money?
Speaker 3: By Murray Rothbart, you.
Speaker 4: Can if you want, you can skip the history a
Speaker 4: little bit and then just like focus on like what
Speaker 4: the system is that we have right now, and like
Speaker 4: why money is such an issue and like why you
Speaker 4: and I talk so much about it. I think those
Speaker 4: are all very good. I would also check out Frederick
Speaker 4: Bastiad The Law.
Speaker 2: It is the best.
Speaker 1: It's also very good to anime of the state, but
Speaker 1: we have to state money.
Speaker 3: But yeah, I think those are probably some of the
Speaker 3: very good books.
Speaker 4: And then when once you feel like a little bit
Speaker 4: more you know, adventurous, then go like into like more
Speaker 4: Messian books and they human action also, so it one
Speaker 4: not last thing. Law Legislation and Liberty by Frederick Hayek.
Speaker 4: Very good book that teaches you about the complex systems
Speaker 4: about law. What law, legislation and liberty. But people should
Speaker 4: only read the first two books. I mean, that's there
Speaker 4: they're split up into three books whatever because Chicago printed.
Speaker 4: It doesn't matter, only the first two, not the third one.
Speaker 1: When I read the Constitution of Liberty, which I think
Speaker 1: was his like seminal work, it was like his last
Speaker 1: book high and.
Speaker 4: I don't think it was his last, but I'm blanking
Speaker 4: on the name of his last book right now.
Speaker 1: It had nineteen hundred citations in nine languages. I'm like,
Speaker 1: no one will ever read in nine languages. I don't know,
Speaker 1: no one will ever be that smart again right now
Speaker 1: or distracted with TikTok or whatever, like, yeah, no one's
Speaker 1: going to be able to do nineteen hundred citations in
Speaker 1: nine languages. Amazing. Cool. Encourage some of your students to
Speaker 1: maybe take some of those Mesis books and we read them.
Speaker 2: I think the World of.
Speaker 4: Benefits, Oh yeah, so we should give a shout out.
Speaker 4: I don't know if you had him on the show,
Speaker 4: but Murphy, Bob Murphy wrote a few of these companions
Speaker 4: to missus Human Action much thinner, and you can read
Speaker 4: it by the side by side or just like that.
Speaker 4: And I think also, like, don't start with maybe Human Action,
Speaker 4: but start with Mary Rothbot's book Man Economy and State, yeah,
Speaker 4: which is an easy explanation of mesus human action. But
Speaker 4: like one book that we didn't mention, which is it's
Speaker 4: tough to read. But I think that's the most mind
Speaker 4: blowing of them all, at least for me to understand truly,
Speaker 4: like why we need to move away from government's means
Speaker 4: of socialism. Yeah, it's the Tour the Force, And like you,
Speaker 4: I had to like every time I went like a
Speaker 4: page that I had like on my chest, I had
Speaker 4: to just like think for ten minutes to try to
Speaker 4: understand whatever I was learning. But it tells you with
Speaker 4: such rigor and clarity about like why we cannot have
Speaker 4: a system that is just based on forced and it's
Speaker 4: like doesn't have price system, it doesn't have competition, which
Speaker 4: by definition is government.
Speaker 1: High ex road deserved Him has a couple of chapters
Speaker 1: that are pretty good on that as well. True, and
Speaker 1: then mesas dot org they have tons.
Speaker 2: Of good information on there. Certainlyybody know that.
Speaker 1: Cool? Well that was signed off, Thanks so much, Mark,
Speaker 1: Thank you all right,