#572: Jeff Booth on How Inflation Is Stealing Your Wealth

Jeff Booth is the author of the new book titled The Price of Tomorrow: Why Deflation Is the Key to an Abundant Future. In this conversation, we discuss inflation, deflation, abundance, ESG goals are nonsense, Personal Greed vs Survival, Weimar Republic, Bitcoin, and the old system vs the new system. ======================= Revolut is a finance app in the US and UK, that say they're the simplest way to access crypto. Sign up today at Revolut.com/pomp and make 3 card transactions to get $15, which you can exchange for any tokens Revolut supports. As usual, when you move your money from fiat to crypto your capital is at risk. See T&C's for details. Revolut is a financial technology company. Banking services provided by Metropolitan Commercial Bank, Member FDIC. Cryptocurrency services provided directly by Paxos Trust Company, LLC. ======================= Exodus is an absolute game changer in the crypto wallet space, and we’ve teamed up to offer an exclusive discount for you, as listeners of the podcast. Sign up for Exodus today using my promo code Exodus.com/pomp. This is a no brainer for both newcomers and crypto heavyweights - go sign up today. ======================= With 10M+ users, Crypto.com is the easiest place to buy, and sell 100+ cryptocurrencies. The Crypto.com Visa Card gives you up to 8% back instantly, and 100% back on Spotify and Netflix. Also, Crypto.com lets you earn up to 8.5% p.a. on BTC, and 14% p.a. on stablecoins. Get $25 when you download the Crypto.com App with code "pomp". Download the App now: https://crypto.onelink.me/J9Lg/pomppodcast2021 =======================

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

• 0:00Anthony 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. Jeff Booth is the author of the new book titled The Price of Tomorrow: Why Deflation Is The Key To An Abundant Future. In this conversation, we discuss inflation, deflation, abundance, ESG goals as nonsense, personal greed versus survival, the Weimar Republic, Bitcoin, and the old system versus the new system. I really enjoyed this conversation with Jeff, and I think you'll learn a lot from it. Before we get into this episode, though, I want to quickly talk about our sponsors. First up is Revolut. Back to the basics for a second. I've partnered with Revolut, a finance app in the United States

• 0:43Anthony Pompliano?

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• 1:25Anthony Pompliano?

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• 2:10Anthony Pompliano?

  For your free download or search Exodus on the App Store or the Play Store. Again, exodus.com/pomp for your free download or search Exodus on the App Store or the Play Store. Last but not least are my friends over at crypto.com. With over 10 million users, crypto.com is the easiest place to buy and sell 100-plus cryptocurrencies. The crypto.com Visa card gives you up to 8% back instantly and 100% back on Spotify and Netflix. Also, crypto.com lets you earn high rates of interest on Bitcoin and other stable coins. Get $25 when you download the crypto.com app using code POMP today. Again, $25 when you download the crypto.com app and use code POMP. You can download the app by going and clicking on the link in the description.

• 2:54Anthony Pompliano?

  All right, let's get into this episode with Jeff. I hope you enjoy this one.

• 2:56Speaker 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.

• 3:25Anthony Pompliano?

  All right, guys. Bang, bang. I've got Jeff here with me. Thank you so much for doing this.

• 3:28Speaker 02

  Awesome to be here. Thanks.

• 3:30Anthony Pompliano?

  All right, we got a lot to cover, so let's just start with kind of the basics of inflation versus deflation. How do you describe that to people?

• 3:39Speaker 02

  I take a pretty simple outlook and I just say inflation is when your money is worth less over time. Goods and services go up in relation to your money and deflation is the opposite. Your money is worth more over time and goods and services go down in value against your money.

• 3:54Anthony Pompliano?

  The entire world that we know today exists based on an inflationary system. So the money is devalued, meaning that goods and services, the price of those go up over time. It's pretty much common knowledge, right? And also accepted by the majority that that is how the system should work. I think you've got a very different opinion. I tend to be sympathetic to your view of the world. But maybe just describe like, what are the issues with that inflationary system? And then why do you think that there's actually a different system that could be better?

• 4:26Speaker 02

  Well, we've always grown, you're right. We've always grown up in an inflationary system and it's worked well for the majority of population. My parents' house went up in value. They paid back that debt with cheaper money than they earned more throughout their life. And so on that path, it sounded like a good thing. We were taught it in school. Inflation is required. And, and this is what some of the stuff that I explored in the book. But then that system is bumping up against technology. So we've always lived in a system. We measure everything from that system that we're in. And then that system is bumping up technology, wanting to bring down prices really fast.

• 5:10Speaker 02

  Wanting to do, and what does technology do? Whether it's a CEO that puts technology into the company, whether it's you using technology. Technology does more for less, right? No CEO puts technology in their company to make prices go higher. They do it to give you more for less or to compete in a, in an open market to, to drive more value to you. You use technology for the same reason. And so when you add up what's happening with technology bumping into this force of inflation that, that is really man-made, is created, created, man-made inflation. That you, you ask, how could those two systems work together?

• 5:50Anthony Pompliano?

  So you have the technology being a deflationary force, meeting the inflationary force of money in central banking. And now when they meet, you're saying one has to override the other. Okay, what is the legacy system and the people who are proponents of the inflationary system? Do they believe that the inflationary system will be the overriding force there? Or do they actually think that the deflationary force is greater?

• 6:17Speaker 02

  You know, it's hard to ask what every single person wants or doesn't. But what I would say is, most people are trapped in the system and they have no idea that there could be a totally different system that produces better outcomes. They have no clue because they live in the system. They measure their house prices by the system. They measure their food prices by the system. They measure everything by the system and that system requires prices to always go up forever, in perpetuity. And because that system is built on credit, and that credit, if prices start to fall, would unwind because nothing's backing the credit, it would keep unwinding. And so if you allowed deflation to happen in that existing system, it unwinds to the

• 7:02Speaker 02

  ground. So you borrow money from me, somebody borrows money from you, and everybody thinks the other person is safe. But when it starts unwinding, it's just, the counterparties move all the way, go to all the way to the sand. There's nothing backing it. It's just credit backing it. And so credit in a deflationary system gets more expensive and can't be repaid. So that's really the, that's really the problem with these two systems, but they're diametrically opposed. And so what governments are doing, they're trying to print more money, change the rules of free markets and become in centralized markets essentially to print more money to

• 7:45Speaker 02

  pretend that system still works. And it has dramatic consequences.

• 7:50Anthony Pompliano?

  This entire credit-based inflationary system, it's basically a confidence game.

• 7:57Speaker 02

  Well, to a point. So again, let's go, it worked and it drove a lot of value to society for a long time. Yes, other countries, if you looked at the US, other countries didn't, it didn't work for and everything else, but with the, with the reserve currency, it worked to drive, drove a lot of value for the economy. It just, it can't work going forward.

• 8:19Anthony Pompliano?

  Okay. What, what is the impetus or the kind of milestone that changes? It did work, but now it can't.

• 8:26Speaker 02

  So it always, if you, if you go, if you, if you break it down, you, and just ask yourself, why do I want my money to get, be worth less each year?

• 8:37Speaker 02

  That, that question kind of deserves an answer because I don't think personally, any single person wants their money to be worth less each year. But when they roll it up into a system, they think that that's a good thing. So, so first, but, but, so inflation is just a hidden tax. So, so governments don't want to tell you the truth about the services that you want and, and what they need to pay for them. So they hide it into an inflation. So, because tax rates would go way higher.

• 9:11Anthony Pompliano?

  Without inflation.

• 9:11Speaker 02

  Without inflation. And so inflation is a hidden tax, but it's a hidden tax on the most vulnerable part of society. So it's, it's a, for somebody like me with lots of assets, it's, I, it's a windfall. The debt gets less, less and the assets go up, my rents go up on houses and everything else. So it's a windfall.

• 9:33Anthony Pompliano?

  What you're describing real quick, just for people who are listening, is there are, if we separate a population, let's say the United States, and we break it into 20%, so top 20%, next 20% all the way to the bottom 20% of Americans. At some point, there is, let's say, the top 50% have investable assets, they have non-cash, right, where they store wealth.

• 9:59Anthony Pompliano?

  The bottom 50%, again, general number, they don't have that. And so all of their wealth is in dollars. And what you're basically saying is that when the dollars are devalued, the people with the assets are benefiting. It's a good thing, right? They're encouraging it, they're cheering it on. The people at the bottom, though, are actually having the exact opposite effect. They're seeing their wealth hit harder and harder with that invisible tax and actually are becoming poorer and poorer.

• 10:23Speaker 02

  And if it was 50/50, that would be one thing. But the wealth inequality, when you look how bad it is, it's way worse. And it's, people measure income inequality, it's wealth inequality. It's actually what you just said, it's the assets. So just imagine you're having one house and the house goes up in value and you're living in the house. Now you have two, and somebody, your neighbor has two houses and both go up and the rents go up. So somebody on the other side of the equation, the renter, is paying a whole bunch more. Their money went down in value, yours went up. Now imagine you're Blackstone and you have hundreds of thousands or millions of houses that you're renting to a whole bunch of people.

• 11:07Speaker 02

  It's a massive wealth transfer to the rich. And so the more you have, more investable assets, real estate, stocks, everything else, that is just a staggering wealth transfer to the rich. But again, going back to it, why do we need it? Why do we actually need inflation? If you just go to first principles. And before we go into, it won't work anyways because technology is a stronger force. Why do we need it? And who says that inflation is required? Who says that you have to devalue your money or hide taxes in inflation to be able to thrive as a society?

• 11:52Speaker 02

  It seems like that's worth a question or worth an answer. And I don't see an answer for it.

• 11:58Anthony Pompliano?

  What do you think their answer would be?

• 12:02Anthony Pompliano?

  Even if it's not a good one.

• 12:03Speaker 02

  Okay, so what I know now is these two systems, because the system would fail spectacularly without inflation and without, where do we go to? So, so system changes require something to move to. We'll talk about Bitcoin a little bit as well. But what happens from the existing system? Let's say you're in government, pump. What do you do? Do you just say, okay?

• 12:33Anthony Pompliano?

  Game's over.

• 12:33Speaker 02

  Game's over. Let's stop, stop printing. Because if you do, every single bank collapses, every single institution collapses, there's chaos on the streets as the, as what should have happened a long time ago, kind of overriding free market forces. It wouldn't have looked like this now, but now because, because governments have kicked the can down the road so, so far, that now it would be a complete and utter collapse, global, global collapse. And so it's, it's a, they're stuck. They're stuck in a corner right now from the existing, from the existing system. And, and I think what, what was happening, and this is why technology, if we go on the

• 13:18Speaker 02

  other side, the other system, what, what's around us all the time and we don't know, but we don't notice how fast it's moving, is this technology impact. My phone used to just be a phone. Remember, it was only 2007 that the iPhone was, that came out. And think of what you have for free on your phone today, from photos to everything else to, it's, it's just all abundance, more and more for less out of, out of your phone. It's, it's, it's everything now. It's going to be your AI device. It's going to be a whole bunch of things. And that, that is a bigger impact going forward. So most of the, so that, what that sets up is you're in a, in a macro deflationary and a world.

• 14:04Speaker 02

  With government printing trying to stop it. But if you go backwards in time, you can see actually the evidence of what I'm saying in time. So when I wrote the book, there was 185 trillion dollars of new money. So to call it stimulus, credit creation, to create 46 trillion dollars of economic growth over the last 20 years. And what I think has happened is this. We've actually not had, we should have had with technology, 2% or 3% deflation per year, or disinflation per year. That's what the natural course would have done.

• 14:46Speaker 02

  And instead of allowing the natural course, so your things, everything around you would be getting less and less expensive. And it wouldn't take as much labor. So you wouldn't need as many jobs to be able to do that as things fell out of price. But instead of allowing that to happen, because, and it isn't not bad people, bad incentives on the existing system to kick the can down the road. We can grow our way out of that. So interest rates come down, that will create a bunch of money. When we can't pay the bounty back, we're going to, we're going to print money instead to pretend we can pay it back.

• 15:24Speaker 02

  And so that 2%, 3% natural rate of deflation that's moving forward is, is being offset with inflationary or trying to print money. And so now you're out, if you, if you looked at, you're out here and the fall to where the natural market would look like.

• 15:44Anthony Pompliano?

  It's getting worse.

• 15:45Speaker 02

  Would be staggering. So, and what that means is the further we go down this path, because technology is not moving slower. It's moving, so again, most of the deflation is in front of us. The further we go down the path, the further we kick the can, the more we kick down the can down the road and the worse the consequences are.

• 16:05Anthony Pompliano?

  Is there a point in time or a milestone that you can't kick the can further down the road? Because I think most people generally think, if they understand, kind of even at an elementary, you know, level. Okay, a lot of what we're doing with bailouts and inflation and this stuff is we're just pushing the problems further ahead. Yeah, we're making it a little bit worse, but at that time we'll address it. You even hear the Federal Reserve at times talk about, you know, we're not worried about inflation in 2020. When if inflation shows up, we'll deal with it at that point. We have confidence that we'll be able to do that then. Is there a point where just there is no more kicking the can down the road and it's like, kind of like D-Day? Like, hey, just we got to deal with it today and it's not pretty?

• 16:43Speaker 02

  You've heard gradually, then suddenly?

• 16:45Anthony Pompliano?

  Yes.

• 16:46Speaker 02

  Yes, that's how markets, that's how markets work. And a lot of things don't, I use that example in the book. I think we talked about it before. Blockbuster, 9,000 stores, Netflix, different way of, different market. And Blockbuster put candy aisles in their stores and had one of their best years because of the candy, the year before they went bankrupt. So, and it's just, it was a story, it's crazy, crazy. And you'd look at those executives in Blockbuster and you said, how couldn't they see it? That's what, that's actually the most important part. It is not, typically not, bad actors, people trying to hurt you or anything else in the, in the system. It is the system itself

• 17:28Speaker 02

  trying to do whatever it can to protect itself. And, and you could put any different president in, you could put any different, the system itself is built in a way to, to, to reinforce it. And the entire structure reinforce, reinforces that. So it requires a system change to get to the other side. And I, and, and this has huge implications, huge implications for, actually, how humanity moves forward. And, and because, because the consequence of continuing kicking the can down the road like this, it kind of raises up, you can see the homeless,

• 18:11Speaker 02

  you can see the, so some people are hurt by it, some people are helped by it. And it, and it puts the electorate in a spot that will overthrow the government and, and, but, but again, overthrow the government, thinking that it's a person. And, and it's just a consolidation of power.

• 18:34Anthony Pompliano?

  When you think about the system itself.

• 18:42Anthony Pompliano?

  It feels very weird that, one, the people who are in charge of the decisions that get made with the monetary kind of experiment, they are appointed, not elected. I actually don't know if that matters or not, if they would make any different decisions, or if there would be the disruptive candidate like Trump was to American politics, or whatever, kind of the outlier, or if it would just, we would elect the person anyways because they worked at some bank and we think they're smart. But then also, two, is it's a very, very small group of people that are making these decisions that affect 330 million Americans inside the United States and however many else, you know, around the world that use

• 19:24Anthony Pompliano?

  the dollar as a global reserve currency. But what you're really saying here is, it doesn't matter. It doesn't matter if they're elected or appointed. It doesn't matter if it was five people or 100 people making the decision. The system is the system and they're actually doing exactly what the system needs them to do to continue to perpetuate the system that we live in.

• 19:41Speaker 02

  And why we didn't see it as fast as before, why we never actually asked the question, is inflation a hidden tax, or is it a tax? What is because it happened so slowly in 20, 30, 50 years ago. It was happening slower because technology, people talked about demographics, they talked about, in economics, they talked about all of the other things about, okay, supply chains are moving overseas, and then that's disinflationary, or demographics is disinflationary, but we're driving inflation against it. But it's happening, it was happening a lot more slowly than what you would suspect would happen with technology. And the exponential movement of technology, I use this on your last show, but the folding of the paper 50

• 20:25Speaker 02

  times, and folding a paper on itself 50 times, reach a piece of paper will reach the sun on fold 50. And, and, and on, on Moore's law, we're on fold 34. So, and so you start to, you start to think, what does fold 35 look like? What is, when we think about self-driving cars and AI, and we're looking now, historically looking backwards, and we, we think we're looking forwards on this exponential pattern, we're not. So if it required as much printing... To be able to pretend the world's, the system still works today. What's it going to require going forward? And so it's just, these two systems are incongruent together. They don't work together.

• 21:09Speaker 02

  A new system is required for sure. Technology is not slowing down. And so, so then you start to look into GDP. What's, ask an economist to measure the GDP output of, of all of the, all of the pictures you use on your phone, right? Like, think of what that's done for you and how many photos you take and curate and edit and everything is self-edited compared to what Kodak and that entire industry looked like before. Or, or an economist to measure, I, I used to spend, I, I remember spending 1999 for a record, right?

• 21:52Speaker 02

  A record, or then a CD. There used to be record stores and CDs. Now I spend $10 a month for unlimited music. These things are deflationary and they're all around us, yet we don't notice it because we're, we're living in a system that's trying to eradicate those gains. By the way, those prices I just said are with the inflationary impact. What would they be without it?

• 22:16Anthony Pompliano?

  So that's one of my big questions is, let's say that there was somebody who was incredibly forward-thinking, incredibly intelligent, maybe even came from the future and they were running kind of all central bank activities. And they decided, you know what? I'm not going to play the game, right? I'm actually going to allow technology to run its course and go into this deflationary environment. What would be different about today if had this had started in the seventies or eighties, right? Is it $1 would be able to buy a whole house? Like, like literally the money would be so much more valuable and therefore you would be able to exchange it for other assets? Is it that technology actually would be further along and our lives would look like

• 22:58Anthony Pompliano?

  the technology utopias that you see, you know, in sci-fi movies or just like, like what would be different?

• 23:03Speaker 02

  Well, even Keynes, who's ridiculed and everything else today, and, and because a lot of his policies have been turned into what we see now, Keynesian. But he predicted in a 1930 essay, the economic possibilities of our grandchildren, that we'd be working 15-hour weeks by now. And again, technology saves time. Technology does more for less. And the output of that is you get more for less and your time increases.

• 23:35Speaker 02

  But because that hasn't been followed and because we've warped monetary policy to be able to stop that, essentially, we're creating slaves. So a whole bunch of people on mouse wheels trying to work harder and harder to get more share of the pie, take bigger bets, more gambling in economics too, to try to outpace this devaluation of currency. That system can go on for a long time. So you asked about when does it stop? It can.

• 24:13Speaker 02

  I think people get confused and they think, okay, remember the macro trend is deflation. That is what we should want if we want an abundant future. That is what we should want. The policy result is inflationary and people are going to say, well, these two systems are competing against each other. Everybody's going to want more handouts. They're going to want more money. Trying to get elected as a government saying, no, here's what we're going to do. We're going to turn off the taps. Good luck. Suicide mission. Suicide mission. And so you have to expect that that'll happen. But so will the negative externalities of those decisions.

• 24:57Speaker 02

  Those negative externalities, typically what happens is war and revolution, and then a reset of a currency. If you go through history, that's what it looks like. And that path, that's what that would lead to. Because the existing system cannot deal with where we are in technology today or the amount of debt to pay back. So it has to devalue it. But. But it can, so a lot of people think that we're going to go into hyperinflation right now. I disagree completely because the market forces, and I know it looks like it right now because of all the printing before, and that inflation can, unless printing

• 25:40Speaker 02

  is, is moving up all the time to match the deflationary, the deflationary impact of technology, is moving up all the time. So more and more and more, you're not going to, and then at some point you could break the currency and move into hyperinflation. But, but think about what's going to happen next year at this time. So lumber prices were up three times, housing prices are up and everything else. So next year at this time, when they reference the rate, if lumber prices aren't that high, that's going to be more deflation. Right? And then you're going to have to print more to be able to make things go up, go up, go up higher. It's the whole system is a feedback loop.

• 26:22Anthony Pompliano?

  Do you think that the Federal Reserve can stop printing in terms of where we are today? So coronavirus happens, there's economic uncertainty, right? One moment, then there's kind of panic, chaos, liquidity crisis, all hell breaks loose in markets. I remember explaining to somebody, March of 2020, there was literally days people were walking around in like zombies in New York City, right? Just like, what is going on in these markets? Fed steps in, central banks around the world, they print trillions of dollars, and it's all done from a, we are going to be responsive to the economic chaos, liquidity crisis, we're going to do everything we possibly can to not only stabilize markets, but actually reverse the fall of these assets and head the other direction. They then decide multiple

• 27:07Anthony Pompliano?

  times in the United States since then, do it again in various forms, whatever. Their belief the entire time has been inflation wasn't going to happen in terms of high levels of inflation. We're getting increasing levels of inflation right now. There's a belief that it's transitory.

• 27:24Anthony Pompliano?

  Is there a world where they just say, hey, look, eventually we kind of run out of the impact of what we've already printed, we don't print anymore. And therefore, you know, we're kind of back to the nor back to normal or back to the old day?

• 27:36Speaker 02

  No.

• 27:36Anthony Pompliano?

  Or is it just, here we go again, they're going to print more later this year and more next year and more the year after?

• 27:41Speaker 02

  So that's actually why you need to look at the trend line, or we should look at the trend line. And what, what is, what's technology telling us? What's the inflation? Or what's the policy telling us? And so remember, if they allow deflation, everything unwinds. And the unwind would be severe. Just like in 2008, the unwind would have been severe. Right. But the, the amount of printing required in 2008 to stop

• 28:05Anthony Pompliano?

  Small.

• 28:05Speaker 02

  It was 250 billion and small. Remember the marches on Wall Street and everything else?

• 28:10Anthony Pompliano?

  800 billion.

• 28:12Speaker 02

  It started at 250 billion and it went to 800 billion. And now we laugh at that number, 800 billion. It's chump change.

• 28:19Anthony Pompliano?

  There's a scene, I literally wish, we should clip it at some point and just, I should tweet it. There's a documentary called Panic, and there's a documentary called Hank. And both of them involve many of the players in the financial crisis. And at one point, Hank Paulson, I think is in panic, is like, I knew that we needed 700 billion, but I knew I couldn't go in there and say that number. So instead I went in and said, we don't know yet, you know, what we needed, but whatever. And he's kind of like laughing about it. And like 700 billion would be a discount compared to, you know, they just printed 2 trillion, literally a decade later.

• 28:56Speaker 02

  And then a bunch more. And so what will happen, this could stabilize things for a little, not without the negative externalities. But then the next, the next will cost way more. It'll, it has to continue.

• 29:11Anthony Pompliano?

  Basically, every single time there's any sort of economic uncertainty or chaos or any sort of disruption in the market of just prices go up, it goes back to this idea of being addicted, right? The economy is addicted to the stimulus. It has to have it. And every time it needs a bigger shot of the stimulus in order to see the impact that it needs. And so you used to get tens of billions, you got hundreds, and they got trillions. Eventually, we're going to get 10 plus trillion. Our stimulus package is the future.

• 29:35Speaker 02

  So 185 trillion over the last 20 years before before COVID, before when I wrote the book, produced 46 trillion dollars of economic return globally. Now that now it's going to take a lot more than that to produce more growth. And the same thing is going to happen. In other, it's it's just a shell game.

• 29:53Anthony Pompliano?

  Yep.

• 29:54Speaker 02

  So so we've lost control of what the currency is. And that that is forcing people to ask, wait, if you could just make up money at this rate, why am I paying taxes? Why am I and so is forcing more people? And that's, I think, what's happening in Bitcoin, too. It's forcing more people to take a deeper look at their understanding of how the game is played. And and why is the game played that way? What is there some law? Is there some physics law that that requires the game to be played like that? And then it was, not really.

• 30:29Anthony Pompliano?

  What's the new game? Or what's the future game? That as people go and look at and ask those questions, they seem to be gravitating towards there is a different way, a deflationary type environment that could be successful.

• 30:43Speaker 02

  So that's what I think it is. And I think that's the only way that's congruent with kind of humanity moving forward. And and I've and I've looked through all of the different kind of plausible outcomes on the other. And I'm going to simplify this. I think this is where we're at. We're in a world right now, which is most people don't realize it because they're measuring the system from the existing system. And they think, okay, I can, I'm still okay. I am, I'm not as rich as that person, but I'm still okay. And and so most people are living in this this system while the system breaks,

• 31:26Speaker 02

  not realizing that it's consolidating control at an alarming rate. So when you do, you don't, you either have two spectrums, right? And I will all the way to probably. If I was to, I'm going to simplify it, but there's nuance between here. You have free markets. Or you have dictators and or centralization. And and through lots of experiments through history, we see how centralization ends in kind of the biggest thug. And so if you remove free markets, you you tilt and you move on a path in a cascading path because people are short term bias, our own personal short term bias for most

• 32:11Speaker 02

  peoples will will vote for the person that thinks they'll give them the most right now. And and that central and that centralizes. So the great theme right now is is we have centralized economies. And and what I worry about is because this is the path we're on is centralized economies with with AI and robotics and everything else that that look pretty dystopian. If if it's hard for people to rise up against dictators today in their countries, can you imagine rising up against a dictator with drones that can

• 32:49Anthony Pompliano?

  Twenty thousand robots.

• 32:51Speaker 02

  Exactly. And so so and and or we have decentralization and hard money that is a forcing function to to let a free market or a more free market work.

• 33:06Anthony Pompliano?

  When you think about that new world, one of the things that's the most interesting to me is in the old world, abundance does not get passed on to the civilization. In the new world, you do. This framing of deflation and inflation is antithetical in some way to what a traditional Keynesian economic, you know, kind of disciple would say, or even the mainstream media, frankly, where their belief is that you need inflation in order to get velocity of money. If you don't have velocity of money, you can't possibly have an abundant civilization. And so why do you think and are likely right that the deflationary environment actually

• 33:50Anthony Pompliano?

  creates a more abundant future rather than this inflationary one that needs that velocity of money?

• 33:55Speaker 02

  So so if we measured where I'm going to this, there's there's going to be chaos on the chain and the system change, no matter what. But the system change is coming no matter what.

• 34:10Speaker 02

  On, as the system moves forward, didn't, when I grew up, we wanted to save our money so we could buy more tomorrow.

• 34:18Anthony Pompliano?

  Mm hmm.

• 34:19Speaker 02

  And if, and if, if I saved money and there was a, an event, and everything, prices fell, I actually took more of the gains.

• 34:29Anthony Pompliano?

  Mm hmm.

• 34:30Speaker 02

  Right? That's how an economy works, risk, risk, return. So today, in the existing world, we're essentially, you have a no lose bet for, for, if your hedge fund and everything else, or your bank, you, no, no problem, no, there is no consequences of bad actors versus a system that change, uh, changes. But more importantly to, than, more importantly than that, is a lot of the things that we used to buy as things are being digitized. And those things, so we use, use the example of records, use the example of, um, we can see that all around us, but it's just starting. So 3D printing is going to change complete supply chains and around things like this

• 35:15Speaker 02

  in this office, this table, everything else, and it'll be printed in your home. And it's really, all it is, is it's information that has been organized, those atoms have been organized in a physical world, and that information is going to move from your head or AI into a 3D printer, and it's going to be organized at your home, and you're going to have abundance, um, in time. That might take another 10 years, it might take another 15 years, but that is coming.

• 35:41Anthony Pompliano?

  Mm hmm.

• 35:42Speaker 02

  And there's nothing that the existing system can do to stop that from coming. And it go up a level, the more they, the more the existing system kind of inflates, what would a rational CEO do if they can't, if they can't find, if labor is going up in price and technology can remove that labor? Rational CEO is going to, to-

• 36:05Anthony Pompliano?

  McDonald's.

• 36:06Speaker 02

  Exactly.

• 36:06Anthony Pompliano?

  This is my favorite example. They've literally replaced some of the cashiers with touchscreens.

• 36:10Speaker 02

  Yeah. And, and, but that, that's just start, that's just starting. And it, and, and by the way, why do they do that? It's not because- They're bad people is because you as a shopper wouldn't shop there if they had to raise the prices to pay for everybody. Because we live in a competitive environment. So the incentive system is, is, is, right now, the incentives are aligned to a broken model. And if the incentives were aligned to a free market model, you would see prices falling and you'd see, you'd see your time increasing. The prices would fall so far, so fast, and they would keep falling after that.

• 36:50Speaker 02

  So, and let's, I often get the example, or the question, what, what about a market that keeps really high margins? You have a monopoly that keeps really high margins. What do you think would happen with a whole bunch of entrepreneurs? You're an entrepreneur, I'm an entrepreneur. If I saw fat margins and technology being able to provide better outcomes for people, that's the market I would attack first.

• 37:15Anthony Pompliano?

  Yep.

• 37:16Speaker 02

  Incentives change it. Everything, yeah.

• 37:20Anthony Pompliano?

  As we're watching this happen, forget Bitcoin and sound money and all of this. We already see technology is eating the world, right? And it's happening in a very real way, very measurable way. It's been happening for a long time. This is not a new thing either, right? It's just, in some weird way, the horse to the car was technology eating the world. But what we do see along the way is what I will call the pure capitalist with people who are interested in other things, right? So whether it's the ESG crowd, whether it's some sort of climate change, whether it's some sort of other thing that is not just pure economic incentives drive the world,

• 38:05Anthony Pompliano?

  free markets drive the world, let the system play out, and this is where we're going.

• 38:11Anthony Pompliano?

  Are they ultimately on the wrong side of history? And what I mean by that is not so much that their their causes don't matter, or their claims aren't factual in some way. But it's the free market is going to be the greatest referee, or the greatest kind of driver of progress, not mandates and some of this other stuff. Like, how do you think about some of this?

• 38:32Speaker 02

  So, no, that's if unless you centralize everything.

• 38:36Anthony Pompliano?

  Okay, explain that.

• 38:36Speaker 02

  So if you believe 12 people could control every every interaction in the economy, or the government, you lack control everything, and they will always do it in your best interest rather than their best interests, then you should centralize. You should really want centralization. But what ends up happening is even if somebody, the more that Lord Acton quote, power corrupts and absolute power corrupts, absolutely. The more power that somebody has over your decision making process, the more the more it's a gain in power and a loss for you. And that that changes, once it's once it's concentrated like that, you'll lose everything. You will literally lose everything.

• 39:21Speaker 02

  So free market isn't perfect. But it is the best system. It is the best system today. So that is the path of centralization. That's what it'll look like. And so the people closest to the government, similar to what it looks like today, right? Get more of the gains. And everybody races into the government to to protect that. If you look, look at Russia, look at China, look at, look at what they, look at what economies like that look like. And if you want that here, you'll you'll want centralization.

• 39:56Anthony Pompliano?

  I forever have used an example of what is the difference between the person who is the blue collar worker at a corporation who wants to move up the ladder, right? Get more into a position of power for economic gain and kind of the egotistical return on having control and power and all stuff. And a regular citizen who's essentially the blue collar worker equivalent, who wants to then move up into some sort of position of government power. Right. It's a very similar type of mechanic. Now, as we go through this transition, there's this belief that centralization is bad. I think you and I both would agree with that. And I think history would suggest that that is definitely true. Historically, there's been maybe a line in the sand.

• 40:39Anthony Pompliano?

  The government was responsible for some portion of our lives, whether we wanted it or not, that was just part of what they did. But it does feel like it is becoming more and more expansive in their mandate. Right. In their eyes. And so now all of a sudden monetary policy is becoming politicized in a lot of ways. Maybe it always has been and it just wasn't so obvious. But is that the natural progression also of government powers? It just kind of continues to creep further and further and further into your life. And history suggests that eventually it is essentially planned, kind of communist driven or socialist driven.

• 41:14Speaker 02

  Not necessarily.

• 41:16Anthony Pompliano?

  Okay.

• 41:17Speaker 02

  But, but on the trend we are on, on unsound money, when, when governments have control over money and can inflate, that's, that's where it takes you because people will always vote for, for, I want this now.

• 41:31Anthony Pompliano?

  Because they need more.

• 41:32Speaker 02

  They need more.

• 41:32Anthony Pompliano?

  It's not so much that they're even greedy. It's a pure survival.

• 41:35Speaker 02

  So, so, so think about this. So should housing be, is number one, you'd ask, ask over the last 20 years, the $185 trillion. If you didn't, if you didn't increase, if you didn't create $185 trillion, how would housing prices be as high as they are today? Probably not. If you didn't print as much money recently, would housing and real estate look like it looks like today? The answer is no, it wouldn't. Okay. So a whole bunch of people won out of that bet. Now rents are a lot higher and a whole bunch of people lost out of that. So a lot of the people that are demanding more money.

• 42:19Speaker 02

  I need minimum wage to go up. I need, I need free money. I need government subsidies are doing it because they can't pay the bills. Because government reached in and made a whole bunch of prices higher that they can't afford. And so, so that's, that's the kind of why you get when you start to get to this. The system change, you get revolution at some point. Weimar Republic, the rise of Hitler was a result of the very same thing.

• 42:47Anthony Pompliano?

  Explain what happened in Weimar Republic.

• 42:51Speaker 02

  So World War One, they couldn't pay their debts. The US, UK demanded reparations, pay back for World War One. They couldn't pay, they went through a period of hyper, hyperinflation, just print money to be able to pay back the debt in cheaper currency.

• 43:12Speaker 02

  Hitler started gaining power in that. He actually.

• 43:18Anthony Pompliano?

  As a revolution.

• 43:19Speaker 02

  As a revolutionist. He, he actually got put in jail through trying to overthrow the government in, I think, 1924, 25. Dawes Plan came in and said, okay, we're going to give you more time to pay this back and discount some of this from, from, from kind of other, other countries, including the US. And then, and that fixed it for a while, kicked the can down the road for a while. And then 1929 in this, in the States, it started depression, kind of a global depression there as well. So now we go back to hyperinflation. So we print, print more money.

• 44:03Speaker 02

  A whole bunch of people that, and it looks similar at a different, at a different level than what's happening today. But a whole bunch of people are enriched by that printing. And then a whole bunch of people are killed by that that printing. And so those people that are hurt go and look for a revolutionist that and what does does that person do? Typically, they'll blame a person or a group of people and say, it's not your fault. It's their fault. They're the reason that it looks like this and and and it's believable.

• 44:36Anthony Pompliano?

  They've taken your freedom.

• 44:37Speaker 02

  They've taken your freedom. Exactly. Exactly. And it's believable. So so that's how that's how you have revolution or system change. And then Hitler essentially changed constitution, everything else to keep power. And we know the rest of that history. I often ask, why don't why didn't people, as they saw these signposts, similar signposts that we see today? Why didn't they leave? Why didn't the rich people leave Germany? And and the the simple reason is because all of their currency was denominated there. Their their real estate was denominated there. And and and they didn't see the real tail risk was the social revolution and the revolution that was coming. That was the tail risk.

• 45:22Speaker 02

  And so they they stayed and they and and and and what are you going to do? You're going to you can't take your real estate with you. You can't take your money. You're not going to take suitcases of money with you on a plane. So or boat. And so they get stuck. And that's and that's typically what happens. Bitcoin today allows it's a little different. You remember 12 words, you can move anywhere. You're not going to take your memory. And and and so so so so I think even just this alone with all of the signposts before we get into why it's so so important, just if you looked at it through that lens alone, it is a must own asset. It is a must own where what's what's going on in the world today.

• 46:07Anthony Pompliano?

  When you start to kind of unpack Bitcoin itself, how much of your excitement or even sympathy for the asset in terms of why you're holding your portfolio is economically driven from like macroeconomics, I have to have this to protect my wealth versus more of the social and political stuff, which is, you know, if I need to move, I can do it quickly. If there's unrest, if there's confiscation of assets, all that type of stuff.

• 46:37Speaker 02

  That's a super interesting question. I haven't asked that before. Actually, for me, I think I lean more to Bitcoin because it brings fairness and equity to the world. It brings a free market forces that allow the abundance gained from technology to be passed the broadest possible audience. That's my primary reason. I don't need more money. I don't need more anything. I just...

• 47:06Anthony Pompliano?

  Life is good.

• 47:07Speaker 02

  Life is great. I love what I do. I had tons of friends, tons of like, I love everything I do. So I wrote the book more because I'm living in this system benefiting from this, benefiting from this system, understanding that, like, I couldn't understand why prices weren't falling at the rate they should be falling when, when all of the technology companies that I was building were producing crazy returns for people. That's why people were using the, are using the technology companies. And so I couldn't understand why that wasn't happening at the rate that it should be. So that's, that's what I investigated.

• 47:46Speaker 02

  So for me personally, I'm in it more for the fairness. When, if I now put on my investor hat, when I think about how much is in Bitcoin, how much is in other things, my hurdle rate for, for an investment in, in say, a company is really high because, because I know what Bitcoin's going to do. I know how, or I believe. I believe it's going to be, I believe it's going to be a reserve currency. I believe it's going to be a bunch more than that in time. And so I believe in what that will do for a return rate.

• 48:26Speaker 02

  And so I measure every other return rate, other things that I would invest time or against that, against that placeholder.

• 48:34Anthony Pompliano?

  Yeah. Walk me through, what does that world look like? Bitcoin is the global reserve currency. The central banks fail, they give up, they exist, then they just do a bad job. Like, how do you kind of see from where we are today? Walk me through, maybe not a finish line, but just like, you know, 25, 50 years from now, what does that path look like?

• 48:57Speaker 02

  So, yeah, I wrote an article called "The Greatest Game", and it's worth, because it lays out this path and what happens. By the way, it's not a foregone conclusion. I think there's a high, high probability Bitcoin. I think it's unstoppable at this, at this point. But I understand all the FUD and why, why people would want to try to stop it. And, and if you think about kind of attack vectors on Bitcoin, whether it's ESG and everything else, which are complete nonsense, we can go into those.

• 49:33Speaker 02

  I understand the attack vectors for the centralization. Why, why there's a bunch of people in power that think that this is a really bad thing? And it's not a bad thing. It is the best. But then I put on, how do you stop a technology that puts empowerment in the hands of people? Empowers people. It's really hard to stop, especially at the size of asset class it already is, and how it's already built into the rails. So I, I suspect the network effect that's happening on Bitcoin to, to, to change a lot of people's views and, and it, it be a forcing function for, for what we talked about

• 50:18Speaker 02

  in the existing system over time. Early people on, people coming on now and holding now or hodling now, will get more of the share of the gains on that. If you go distant into the future, into, into that, here's a question I'm often asked. Said, well, wouldn't you just create new winners, new losers? And it's interesting to think in a free market on Bitcoin,

• 50:46Speaker 02

  the only way to hold Bitcoin is produce value for others. The only way to gain Bitcoin, right? So otherwise, so if you wanted to to manipulate control,

• 50:58Speaker 02

  then by doing so, you're distributing your Bitcoin, do it to others and you lose control. So, so, so it is, it's congruent to where technology is taking us, humanity, everything else. In my mind, and I think going through all of the movements, kind of the, because we have a short term bias, right? We all do, and we were a recency bias. And, and so we'll look at, okay, today it's inflation. Oh, yes, it's going to be inflation forever. The governments are doing this. China is doing this. It's going to be all over the map. And I would expect volatility throughout this time. And on the, on the way other side, way less volatility

• 51:42Speaker 02

  in the, in the asset class. But I don't think there's anything governments can do to stop it at this point. I, um, I may even cautious saying this on a podcast because I think about what I would try to do if I was desperate to stop it. I would try to make some other coin more popular that I, Would that work? So, so, so I don't think we should, I don't think we should discount how powerful the existing system is on our lives, currency. And, and, and so, so, um, I know a whole bunch of people in Bitcoin would not let it work.

• 52:28Speaker 02

  But, but if, if, if.

• 52:32Speaker 02

  If government went into Ethereum thinking I could control this over time,

• 52:40Speaker 02

  and it ran up in price for some time in that,

• 52:44Speaker 02

  I don't think it would work. I think it would centralize again. I think that's exactly what would happen. But I understand, I would understand the rationale to try to find something I could centralize.

• 52:56Anthony Pompliano?

  Do you have thoughts around proof of stake, proof of work, and kind of the centralization of proof of stake? And just like the rich control?

• 53:02Speaker 02

  That's why, that's why I think, I think Bitcoin is the only system. That's actually why it's such an important thing for me right now. I'll sound like a fanatic or zealot on this. But that's actually why it's so important. If you believe in open, free markets, I believe you have to do everything you can to make Bitcoin successful. Because I think it's the only thing that both has the scale and will be decent and it can't be taken by governments. So, so there's potentially other coins that could be regulated faster, but it,

• 53:38Speaker 02

  but Bitcoin both has the scale. So governments didn't see it fast enough. And now it's in the hands of a whole bunch of people.

• 53:45Anthony Pompliano?

  Tens of millions.

• 53:45Speaker 02

  Tens of millions, exactly. And, and so let's just take the downside of that, tens of millions of people. Those people aren't going to give it up. And it, and more and more people are kind of learning what we're talking about now and coming in and holding and, and holding. And so, yes, there's a whole bunch of people trading. Yes, there's a whole bunch of people that, that are in and out and in and out. But the, the hodlers and people that are holding Bitcoin and understand what we're, we're, we're saying. I don't think, I, that is the, ensure we get more people onto it for that reason. And you're going to have decentralization forever. You're going to have a currency that empowers human beings forever.

• 54:29Speaker 02

  Or I don't want to say forever. You have quantum, you have a different change. But it is.

• 54:39Speaker 02

  It is, it might be humanity's greatest invention. And I, when, when I say that, I know full well what people will say on Twitter and everything else when I, when I look back and printing press and

• 54:53Anthony Pompliano?

  Internet.

• 54:54Speaker 02

  Internet and everything else. But we have a habit of building on top of other great inventions and the next greatest. And, and, and so information creates more information and more error correction on that information. And, and, and, and this, uh, this is a huge breakthrough. I, I think if you looked back at the printing press and that, and the time of the printing press, when it was invented, people wouldn't have thought that was a great invention against other inventions at the time, too. So I think that's, that, that's the level this is playing at, fixing money forever.

• 55:30Anthony Pompliano?

  You, you described ESG as kind of nonsense, um, in terms of fiat currencies and, and some of the goals. Describe a little bit more about what you mean by that.

• 55:39Speaker 02

  So, and, and I want to be careful with nonsense because I'm in some companies and I'm, I'm chairman of three different companies that are doing a whole bunch in, in, um, less carbon or, or climate change and, or, or

• 55:54Anthony Pompliano?

  Things that are involved in ESG related things.

• 55:56Speaker 02

  Exactly, but, but not, uh, not, uh, not washing, not greenwashing.

• 56:03Anthony Pompliano?

  Not, not a virtue signaling.

• 56:05Speaker 02

  Exactly, exactly. Real companies that, that have created technology impact that, that lowers costs and provides benefit. So, so, and so there's an economic benefit to drive, drive. And, and so they're growing really, some of these companies are growing really fast as a result and it's exciting. So it's not, I'm not a climate change denier and everything else, but, um, but, so why is it nonsense? Quite simply, and I haven't seen an answer for this, I ask it all the time. How do you solve climate change through an inflationary monetary system?

• 56:52Speaker 02

  And let's poke on that. So let's use some examples. So you print a bunch of money, you make house prices go up as a result. So there's a whole bunch more jobs in building houses. And there's a whole bunch more lumber needed to put. So the entire economy is actually gamed to grow faster, to emit more, because you're devaluing money to be able to grow faster.

• 57:25Anthony Pompliano?

  The environmental negative side effect is a negative side effect of trying to grow faster, which is all rooted from the devaluation of money.

• 57:36Speaker 02

  Can you grow forever on a finite planet?

• 57:40Speaker 02

  Pretty simple, pretty simple equation. Yet, so why do the only people that believe we can do that are economists? It's logical. Information can grow forever. And so as information, essentially as information, as things become information, you get more for less. That's what's happening. It doesn't grow the same way that our notion of growth is changing with what's happening with technology.

• 58:13Speaker 02

  And so, or use oil. So today, we have new energy coming on through solar and battery, storage and solar and storage, which is some of the lowest cost energy, which is getting cheaper at 11% a year. And for a long time, that took subsidies to try to drive an industry, to try to make it hit that point. And maybe you could argue today, there's still some subsidies, but it's close to that tipping point where in some regions, it's the lowest cost energy without subsidies. And it's getting cheaper. And so as that's taking more of the energy infrastructure.

• 58:58Speaker 02

  And it'll, it'll, it drives down prices. So if energy is the number one input in everything else and prices are being driven down,

• 59:10Speaker 02

  then why are oil prices $70 a barrel or whatever? I haven't looked in and asked a little bit, but why are, and they're $70 a barrel because you've de-based currency against oil and oil is, is a scarce resource. And so those will go up, making oil more profitable, driving exploration and toil and everything else. So, so, and all of that was caused by printing more money. So again, anybody on your blog, reach out to me, find a way to put it on Twitter. How, how an inflationary monetary policy is congruent with climate change? And I'd, I'd debate.

• 59:53Anthony Pompliano?

  You're saying that it's impossible.

• 59:55Speaker 02

  It's impossible.

• 59:56Anthony Pompliano?

  For a inflationary monetary policy to be congruent with ESG goals and actually being serious about creating change in the environment.

• 1:00:04Speaker 02

  It's impossible. It's absolute. So, so when.

• 1:00:08Anthony Pompliano?

  Does Bitcoin solve climate change?

• 1:00:10Speaker 02

  Yes. Yes, it does.

• 1:00:12Anthony Pompliano?

  And I'll explain that because you and I both know, I've said this before as well, and people think that's a crazy statement. So explain it.

• 1:00:18Speaker 02

  And, and because it forces, because it forces a free market, because it forces technology to allow technology to do its job and save you time and reduce prices. So you're not on a treadmill racing, racing more and more and more through a, to try to, to. Why do we work in the first place? Right? If you, if you, and I'll go back to, but, but you're trying to work to be able to say, have security in your life. And to have enough things when you retire. So you're going to work 60 years of your life to, or 50 years of your life to retire with hopefully enough to live the last 10 years of your life.

• 1:01:02Speaker 02

  All well knowing that the goalposts are moving the whole time, trying to move further. So if you're in that environment, what would you do? You're going to try to take risks to get out of this. You're going to, you're going to take, you might lever up a whole bunch of debt at the wrong time because central bank's policy is changed to be able to try to get off the treadmill. Cause you know, the goalposts are moving further and further away. So, so all of the incentives are aligned for everybody to do that, to do that job. When we wouldn't need to and then exist in a different system. The system itself would, uh, would, would fix that. But this system, that system is also responsible for all the climate change.

• 1:01:46Speaker 02

  There's for all the climate damage and environmental damage because it requires more and more and more and more forever. Um, more things, more, more higher prices forever where the system collapses. That's it. And that's why I say that system collapses imminent anyways. Whether through climate, whether through centralization of, of government, whether through revolution is that, that there is a system change coming. Bitcoin produces, I believe, and by the way, when I was going through Bitcoin, I was looking for anything else too. I was looking for anything that what could be a path to get to where technology is taking us.

• 1:02:29Speaker 02

  Um, that, uh, that is a plausible path and it, and it's only Bitcoin. And so that, um, but that it be, because it allows, um, it allows for an equitable world. It allows for the prices to fall. You're not wasting your time on this treadmill. And the externalities of that change means you get things for, for less. And it doesn't cause the same damage to the environment too, if you're talking about ESG.

• 1:02:59Anthony Pompliano?

  Yeah. When you think about the transition, is it the bad stuff has to happen in order to create the transition? Is there some sort of carrot that can be put out there of ESG or dampening the wealth inequality gap? Or, you know, name your kind of thing that people care about that Bitcoin does fix or solve? Or is it just it doesn't matter? And there has to be a blowing up of the of the existing system? And the example that I can only think of is like the burning of the boats.

• 1:03:38Speaker 02

  Yeah.

• 1:03:38Anthony Pompliano?

  Right? The whole example of when people would come to the United States or go looking for new land.

• 1:03:44Speaker 02

  Cortez.

• 1:03:45Anthony Pompliano?

  Yeah, they would literally burn the boats because that means we're not going back.

• 1:03:48Speaker 02

  Yeah.

• 1:03:49Anthony Pompliano?

  We've got to make it work.

• 1:03:49Speaker 02

  Yeah.

• 1:03:51Anthony Pompliano?

  Is that some element of like, the only way to actually make the new system successful, et cetera, is the burning of the boats? And that means the old system has to kind of have a catastrophic event?

• 1:04:02Speaker 02

  Again, it's going to have a catastrophic. It's had lots of catastrophic events. It's going to have catastrophic events. That's for sure.

• 1:04:10Anthony Pompliano?

  But when you say it has had catastrophic events, is 2008 financial crisis a catastrophic event in your eyes?

• 1:04:16Speaker 02

  Well, it is because because of what it did to free markets.

• 1:04:21Anthony Pompliano?

  Okay.

• 1:04:21Speaker 02

  Right? It changed the rules. It essentially is essentially it said, there's no consequences for bad bets. If you're high enough in the if you're high enough on the ladder, there's no consequences for bad bets. If you're low on the ladder and you if you take too much of a loan, we're going to wipe you out. But if you're high enough, there's no consequence. That's what it said, which is the same thing is happening today.

• 1:04:45Anthony Pompliano?

  So agreed. And, you know, the two things that I think you and I see eye to eye on for sure was during 2021, you're bailing out bad businesses. There were bad capital allocators. They took risk. They got caught. Why are we giving them money? Basically taking bad money and chasing even worse money. Two was you can say you're handing out money to people all you want. I don't care if you're handing out $100, $1,200 or whatever the number. is you're going to drastically increase prices that are completely offset and actually make it worse than handing the money out right and so I think those types of things along with 2008 they're catastrophic in the sense that they have a material impact but the system still although

• 1:05:26Anthony Pompliano?

  maybe rocky although there's still kind of a cliff you know to run off of it's still here and so do we have to basically run off the cliff and have like the the complete implosion of the system or can we actually just transition almost like it feels like you transitioned then I transitioned then square transition

• 1:05:46Speaker 02

  yeah so that's actually why it's really important that you have individuals and lots of them acquiring bitcoin because the more individuals the the more peaceful the transition will be that's that's what you you want not hedge funds not everything else they're part of it they're going to play in the game but why we want a lot of think about the people most hurt by by the policies those are the people that are most in favor of the policies and many of them don't understand bitcoin and there's this there's this essentially marketing or that that they're stuck in a CNBC CNN news flow or Fox or anything else that they

• 1:06:29Speaker 02

  don't really see what's happening here those are the people that need to see what's happening here because because they're most hurt by this they're bearing the consequences of this and so getting a lot more people on board there I think is it would be really important

• 1:06:47Anthony Pompliano?

  so that's probably one of the most important things you think is getting individuals around the world to acquire bitcoin and hold their stake in the network and that ultimately ends up being a very great defensive mechanism not only for bitcoin and decentralization but also for the lack of kind of violent protest and revolution it ultimately ushers in this peaceful transition

• 1:07:10Speaker 02

  that's I believe so

• 1:07:11Anthony Pompliano?

  yeah one of the things that this reminds me of is people always ask about global reserve currency status and an idea that's fascinated me now for a couple of years is every single currency that was the global reserve currency fell and was replaced happened through violent conflict you have the global reserve currency as your country I come we fight I win I now install my currency as the global reserve currency and we move on with the world over and over and over again since the fall of Rome all the way through Bitcoin is actually the first time where having the strongest defense makes you the most powerful in the world, right? When you move from an analog world of violent combat to a cyber world, having the stronger

• 1:07:55Anthony Pompliano?

  defense makes you the most powerful, not having the strongest offense. And so if all of a sudden you have an impenetrable computer network that continues to rise, it doesn't matter how good anyone else's offense is, your defense is better, therefore you're the strongest. And so is it the first global reserve currency that ascends to that position without firing a bomb, a bullet?

• 1:08:14Speaker 02

  So that's the hope. That is the hope. Think about what the existing system's doing and look at the signposts of the existing system. One mention I just wanted to, when you say bailouts for not bad capital allocators, just think about the system first and think about what would you do as a CEO if you had cash on your balance sheet and interest rates were negative or nearly negative? You would spend that cash somewhere, right? You would acquire something, you'd do something to be able to make sure you didn't hold cash on your balance sheet because the government essentially was saying, we're penalizing you for holding cash.

• 1:08:55Speaker 02

  And if you, in a free market, if you hold cash and your other CEO doesn't, he levers up, then you're not going to be the CEO for very long. So the incentives are designed to create the instability in the market, which then requires more bailouts when the instability shows. Now, now go back to the, in the existing, in the existing system. So what was it, the year? And I think until the 2013, the deal with China was US buys China's stuff, China buys US Treasury bonds. And then that ended in about 2013.

• 1:09:38Speaker 02

  Now, now US doesn't have, who finances the growing deficit and not enough people, not enough external financing and you're printing money to be able to hold rates down. So where does China put that money? Wouldn't it be a rational actor in a system where essentially you're going to pay me back with devalued dollars, where am I going to put my money? Wouldn't you think a rational actor would put their money into commodities that are needed for the transition to technology, like rare earth mines and everything else? So if you look through the lens of what other countries are doing and buying up assets,

• 1:10:22Speaker 02

  hard assets of things that are needed for the transition, essentially things that can't be taken away from you, the value, that's where you're, when you see the signposts, you certainly see the rhetoric build around the world around evil empires and everything else, all caused by money that doesn't work, right? But rational actors in their own mind, what will one of those, what will one of, do you think will ever trust, I know for me, I know the answer, will we ever trust a country's

• 1:11:07Speaker 02

  currency again as a reserve currency?

• 1:11:10Anthony Pompliano?

  It's not even a country currency, just a currency that is manipulatable by people.

• 1:11:15Speaker 02

  Yeah, exactly. Will we ever trust that again? And so that's what Bitcoin does. It removes manipulation forever.

• 1:11:22Anthony Pompliano?

  One of the questions I get that I want to end with is, in a deflationary environment, when there is chaos, when there is uncertainty, when there is some sort of external event that provides a shock to the system, and you can't manipulate the currency, do you just allow the free market to correct and that kind of cleans it up? Or is there other things that people will be able to do, right? Because the whole idea is in the legacy system. The monetary policy manipulation is what the solution is, whether it's good or bad. And that is the solution. If you take away that tool in the toolbox, what happens? Or do we just not have those events?

• 1:12:01Speaker 02

  So, so at first we do, and people lever up. So, look at Iceland in 2008, right? Greece kept on, okay, we're gonna kick the can down the road. We need this. Iceland said, you lent us the money on these terms. We're writing it off. And, and, and their economy came back faster than anybody else, else because of that. Because they took a hit and, and, and came back. That's what should, should have, that's what should happen.

• 1:12:29Anthony Pompliano?

  Free markets.

• 1:12:30Speaker 02

  Free markets self correcting. And so, so I don't think it's needed. I don't, I don't believe that, that you need this. I think if you created a transmission mechanism like this, now governments might peg currencies to this and still have a transmission mechanism. I don't think it would work long time term if they're, if they ran their own currency on top of it, because that's what would happen. They would get further and further away and you'd have resets. But, but from a, I, I don't think it's needed. I think the free market would solve it and the free market would solve it in a couple of ways. First, people would increase their savings rate to be able to take those, take those shocks.

• 1:13:15Speaker 02

  They would make sure, and, and when the shocks happened, people would be resilient and they would find, find ways faster through it.

• 1:13:26Anthony Pompliano?

  Yeah. I tend to agree. Before I let you go, where can we send people to just learn more from you? Right? So I know you've got the book. I know that you've done a bunch of content, but when you, when you meet somebody on the street and they say, hey, you're an interesting guy. You've got some really interesting ideas. Where do you send them?

• 1:13:49Speaker 02

  I send them to you. I send them to Robert. I send them to Preston.

• 1:13:52Anthony Pompliano?

  We send them to you. So perfect.

• 1:13:55Speaker 02

  So that's the thing. This wasn't. I wrote the book because it was

• 1:14:00Anthony Pompliano?

  The price of tomorrow?

• 1:14:01Speaker 02

  Yeah. Because I cared about this problem and I cared a lot. So I did a lot of research and cared about the problem. And so I'll still write things and I'll put them out, but I don't need to be, again, I didn't do it to be seen or anything else. Most of my time is actually in, in the businesses and everything else that I really, really enjoy. So my perfect world, a whole bunch of other people take the mantle. And that's what the beautiful thing about Bitcoin is. There are some crazy smart people in this, in this community. And, and if you have

• 1:14:43Speaker 02

  an important message, that it'll be shared, it'll be broadcast. So for people, you follow a lot of them, Pomp, but you do a great job here, here. And so do many of the others. But I would just follow it for people. I would go onto Bitcoin Twitter. I would follow a bunch of the, the, the top people and they'll point you to other top people because they're not trying to control all the thing to make themselves look good. Typically, they're trying to share the best information.

• 1:15:13Anthony Pompliano?

  Yeah, I think that's a great piece of advice. And then people can buy the book on any

• 1:15:18Speaker 02

  Just Amazon is probably best.

• 1:15:19Anthony Pompliano?

  Yeah. Jeff Bezos is taking all our money.

• 1:15:21Speaker 02

  Exactly.

• 1:15:22Anthony Pompliano?

  All right. And then what is your Twitter account?

• 1:15:24Speaker 02

  At Jeff Booth.

• 1:15:25Anthony Pompliano?

  All right. Thank you so much for doing this.

• 1:15:27Speaker 02

  It was awesome.

• 1:15:28Anthony Pompliano?

  And I think everyone else learned a lot. So we'll have to do it again.

• 1:15:30Speaker 02

  Yeah, thanks.