#889 Free Markets vs. Market Interventionists

This episode is a little different than the usual podcast format. There is no guest. Instead, I will share a couple of thoughts I have around a specific topic. Today I discuss how the free markets continue to lead the way in positively changing society despite market interventionists claiming the contrary. ======================= LMAX Digital - the market-leading solution for institutional crypto trading & custodial services - offers clients a regulated, transparent and secure trading environment, together with the deepest pool of crypto liquidity. LMAX Digital is also a primary price discovery venue, streaming real-time market data to the industry’s leading analytics platforms. LMAX Digital - secure, liquid, trusted. Learn more at LMAXdigital.com/pomp ======================= The Pod Pro Cover by Eight Sleep is the most advanced solution on the market for thermoregulation. It pairs dynamic cooling and heating with biometric tracking. Go to https://www.eightsleep.com/Pomp to check out the Pod Pro Cover and save $150 at checkout. Eight Sleep currently ships within the USA, Canada, and the UK. ======================= The world's 2nd largest crypto exchange, OKEx, has dropped the "E" to become OKX, reflecting its evolution from a traditional crypto exchange to a comprehensive, cross-platform crypto services provider. With OKX's decentralized platform and Web3 wallet, MetaX, you have full custody over your crypto. Explore DeFi, NFTs and play-to-earning gaming with the world's most powerful crypto exchange. Visit OKX.com to learn more. =======================

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02Anthony Pompliano?

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Now let's kick this thing off. Today's episode is a deep dive into the balance between free markets and market interventionists. I use two explicit examples to highlight some of the thoughts here. I really hope that you enjoy these episodes. Before we get into this one, I want to first tell you about our sponsors. First up is LMAX Digital, the number one institutional crypto exchange. They offer clients the deepest pool of crypto liquidity on the planet, underscored by 100% uptime track record through volatility spikes. They leverage LMAX Group's liquidity relationships and ultra-low latency technology. LMAX Digital is the market-leading solution for institutional

• 0:44Anthony Pompliano?

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• 1:25Anthony Pompliano?

  most advanced solution on the market for thermal regulation. It pairs dynamic cooling and heating with biometric tracking. You can go to eightsleep.com/pomp to check out the Pod Pro cover, and you save $150 at checkout. They currently ship within the United States, Canada, and the UK. Now I told you, it changed my life. It helps me sleep deeper, helps me sleep longer. I feel much more refreshed, and I have better energy. You want to know how I have relentless energy every single day? Because I sleep on an Eight Sleep. Seriously. Go check it out, eightsleep.com/pomp today. This episode is brought to you by OKX. OKEX has dropped the E to become OKX. Founded in 2017 with a mission to deliver a cutting-edge crypto trading experience, OKX, the world's second-largest crypto

• 2:10Anthony Pompliano?

  Crypto exchange by trading volume has since expanded its scope alongside the wider industry, adding features from all corners of crypto. If EX is about exchange, X is about intersections. Cross-chain, cross-functional, cross-platform, an interoperable future that's not siloed into isolated platforms and blockchains. The name change and the new look and feel represent OKX's ongoing move towards decentralized finance. With OKX's decentralized platform and Web3 wallet, MetaX, you have full custody over your crypto. Connect MetaX in your browser or within the OKX app to explore DeFi, NFTs, and play to earning gaming, the world's most powerful crypto exchange.

• 2:52Anthony Pompliano?

  Whether you're just learning about crypto, you're a seasoned DeFi DJ, an NFT enthusiast, or a pro trader, you're all invited to a better future. Go check it out today and let me know what you think. All right, let's get into this episode. I hope you guys enjoy this one.

• 3:06Speaker 01

  Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only.

• 3:29Anthony Pompliano?

  Good morning, everyone. Bang, bang. There are various schools of thoughts in business, finance, and politics. Some people believe in free markets as a self-correcting mechanism, while others believe that market intervention is a better pursuit. Each of these ideas can be taken to the extreme. Free market believers become anarchists and market interventionists become communists. Extremism in either direction has historically led to magnified problems in a society, so we'll refrain from including those in this analysis. If we simply evaluate market intervention versus free markets, I believe we are beginning to see a recurring theme in the digital economy. First, the federal minimum wage in the United States is $7.25, and it hasn't changed since July of 2009.

• 4:13Anthony Pompliano?

  Each state has their own minimum wage requirements as well, which range from no minimum wage in states like Mississippi, South Carolina, Tennessee and Louisiana to $5.15 in a state like Georgia to $15 an hour in California and New York. Barring California and New York, which only require $15 an hour for a small selection of businesses in their state, there are no states that have successfully achieved the $15 per hour minimum wage that is constantly floated by politicians on the campaign trail. This is noteworthy because numerous studies highlight that approximately 80% of American workers are now paid at least $15 an hour. Andrew Van Dam and Heather Long from the Washington Post explained last August, "The US labor market hit a new milestone recently.

• 4:58Anthony Pompliano?

  For the first time, average pay in restaurants and supermarkets climbed above $15 an hour. Wages have been rising rapidly as the economy reopens and businesses struggle to hire enough workers. Some of the biggest gains have gone to workers in some of the lowest paying industries. Overall, nearly 80% of US workers now earn at least $15 an hour, up from 60% in 2014. Job sites and recruiting firms say many job seekers won't even consider jobs that pay less than $15 anymore. For years, low-paid workers fought to make at least that much. Now, it has effectively become the new baseline." End quote. So the politicians and regulators who are acting as market interventionists have been unsuccessful in achieving a $15 minimum wage at the federal or state level.

• 5:43Anthony Pompliano?

  At the same time, the free market has already driven the effective minimum wage for workers past that milestone. This is a classic example of the free market driving results while the market interventionists are bogged down in bureaucracy and politics. Another example of this comparison is in the accredited investor rules within the United States. Currently, only investors that meet specific wealth and income milestones are eligible to invest in private market opportunities. These opportunities traditionally fall in the private equity or venture capital bucket, but can include real estate or debt offerings in certain instances as well. Many people in positions of power and influence have discussed evolving these rules to allow more individuals to participate in these investment opportunities. Ideas have ranged from a knowledge-based test to lower wealth and income level requirements.

• 6:28Anthony Pompliano?

  While the regulatory and political apparatus continues to discuss potential solutions, the free market has found a unique solution. Bitcoin was launched as a decentralized asset that was rooted in open source software. There was no need to adhere to securities law because there was no team or individual that personally benefited from the creation, launch, and scaling of the asset. While the asset failed to meet the securities framework, it provided the single best investment return over the last decade. These venture capital-style returns meant that anyone in the world with an internet connection, regardless of wealth or income, finally had the opportunity to capture private market returns. The free market figured out how to democratize access to investment opportunities without the need to wait for the market interventionist to create the solution.

• 7:12Anthony Pompliano?

  It would be difficult for every asset in the private market to become a decentralized, open-source software solution, so there are still challenges in the market, especially when you evaluate this solution for its ability to be replicated. With that said, the free market was still able to create a solution that addressed one of the hardest problems to solve in financial markets. These two solutions show that the free market has the potential to create solutions before the market interventionists. It isn't a guarantee, and there are still questions about which approach can create the solution faster, but it is hard to ignore the efficacy of free markets in the digital economy. When you overlay the complexity across jurisdictions and geographies, the free market may actually be a better governor of the various aspects in this new world. Humans always want to feel like they're doing something. They are solving problems.

• 7:57Anthony Pompliano?

  They are addressing bad situations. They are constantly in control. But the truth is that sometimes the free market outperforms humans, which is worth celebrating. I hope each of you has a great day, and I'll talk to you tomorrow. Thanks so much for listening to today's episode. I really hope you guys enjoyed this one. Make sure you subscribe on Apple, Spotify, or your favorite podcast player. And if you're looking to try to transition to get a new job in the Bitcoin or crypto industry, we've got you covered. Head over to pompscryptocourse.com. We've developed a curriculum with the top teams across the industry. It's a three-week intensive training program with over 50 events packed into that three-week time period. Go to pompscryptocourse.com to learn more, and I'll meet you guys for the next episode.