Epicenter - Learn about Crypto, Blockchain, Ethereum, Bitcoin and Distributed Technologies - Demetri Kofinas: Uncovering the Hidden Forces of Today's Society

Episode Date: October 6, 2020

Hidden Forces is a podcast devoted to exploring the underlying forces driving the most powerful changes we see in the world. Demetri Kofinas, host of the show, holds conversations with some of the most brilliant minds in technology, finance, social science, and the hard sciences. He consults blockchain and distributed ledger technology companies, and hedge funds and venture capital firms on how to invest in and around these same emerging technologies. We chatted to Demetri about a range of current topics from the US presidential election, the financial crisis and the role of the federal reserve and how it's reacting to the crisis. Also the role of central banks going forward in this new reality in which we live. We also discussed crypto and specifically his thoughts on the DeFi space. He has some very interesting views there. Demetri does not hold back on what he wants to say, so this was a fun and interesting conversation which we are sure you will enjoy too!Topics covered in this episode:The US presidential electionDemetri’s background and why he started Hidden ForcesHidden Forces and how he chooses guests and topicsDemetri's healthHow Demetri sees the impact of blockchain on a societal levelThe current economic crisisThe fundamental difference of the handling between past crises and the current one, by financial institutionsIs the US on the brink of collapse?What is the role of the central bank if it can no longer function how it is supposed to, and can crypto play a roleWhat are some past dApps that would contribute value to societyDemetri’s views on AmpleforthCan a cryptocurrency become a world reserve currency?Episode links:Hidden ForcesThe story of Demetri's tumourDemetri's websiteDemetri on MediumHidden Forces on TwitterDemetri on TwitterSponsors:Algorand: To learn more about Algorand and how it’s unique design makes it easy for developers to build sophisticated applications. - https://algorand.com/epicenterThis episode is hosted by Sebastien Couture & Friederike Ernst. Show notes and listening options: epicenter.tv/360

This is Epicenter, episode 360 with guest, Dmitri Kofinos. Hi, I'm Sudasnikw with you, and you're listening to Epicenter, the podcast where we interview crypto founders, builders, and thought leaders. On this show, we dive deep to learn how things work at a technical level, and we fly high to understand visionary concepts and long-term trends. If you like Epicenter, there's a way you can support us that's super easy and cost nothing, and that is to leave us a review on Apple Podcasts. And if you're on a Mac, an iPhone or an iPad, you just need to go to epicenter.rocks slash Apple, and you'll be done in a jiffy. Today our guest is Dimitri Kofinous, and he is the host of the Hidden Forces podcast.

This is a show that covers a wide range of topics from global finance, the geopolitics, to technology trends, and even crypto. And he interviews top people to talk about these topics and try to understand the hidden forces that drives all of them. Like many people we interview on the show, Dimitri has a really interesting backstory. and prior to doing this podcast, he had a TV show on RT where he covered capital markets. What I like about Dimitri is that he's a bit of a contrarian and also a realist. I think he looks at things from a very pragmatic perspective and isn't afraid to call out bullshit. And this is a little bit of what we did here in this interview. We covered a lot of things here, including the U.S. presidential election as we recorded this the day after

the presidential debate or whatever you want to call it. We also discussed the financial crisis and also the role of the Federal Reserve and all of this and how it is reacting to this crisis, but also the role of central banks going forward in this kind of new reality in which we live. And of course, we also discussed crypto. And specifically, we talked a lot about defy and got Dimitri's thoughts on the sort of exuberance that is happening in the defy space, he has some very interesting views there. So all around, this was a really interesting conversation. It's a little unorthodox compared to what you're used to hearing on the podcast, but Fralika and I had a lot of fun talking with Dimitri. If you're looking to build a crypto finance application or a defy application, you should definitely check out Algarand. Algarand is fast, it's secure, it scales, it has instant finality, and it has all the building blocks you need to build fast and secure defy apps in no time. I'll tell you a little bit more about that later on during the interview. But for now, here's our conversation with Dimitri Kofinos.

Yeah, so I'm like, I'm really excited to have you on the on the podcast. I mean, I've been listening to you not since very long, but since I've started listening to you, I think I, you know, you're the podcast that has gone from like occasional listening to like all out listening to all the time and also paid subscriber, like the quickest. And you're one of the few podcasts that I have as auto download and I get a notification and listen to it the same day. So yeah, I'm really excited to have you on and talk about all kinds of things related to crypto, but also hopefully much broader and talking about kind of like the financial crisis that we're in and like the implications that all this stuff has coming together on the next, you know, decades to come. And this is

also a kind of interesting time to be recording this because yesterday was the debate or whatever you want to call it between Donald Trump and Joe Biden. So we can maybe just address that briefly also at some point. Yeah, that was that was really disturbing and scary. Yeah. It was a really fright. It was definitely the most disturbing, disquieting debate that I've ever seen in my lifetime. And I've also watched a lot of the, I've watched all the television debates going back to Kennedy, and obviously there was nothing like that. I don't think we've ever had a presidential debate like that. You probably would have to go back to the 19th century, and even then, I don't know what you'd find.

Because you don't have the context of America being a global superpower. Yeah, and maybe, to me, maybe the most disturbing thing about it was that I'm not sure whether it actually changed any of the numbers at all. I think it kind of stayed pretty much the way it was, and that actually tells you a lot about the state that the U.S. is currently in. For sure. And the whole theme of political polarization has been, it's been something that people have been talking about for the last few years, right? I mean, that's been, or maybe even going back to the second Obama administration, or even the first was the Tea Party movement. But I think what's so scary about this election is that absent an enormous, and even then, it's not clear that that would make a difference, but absent an enormous margin of victory, the outcome is going to be bad regardless. And I do worry about the possibility that it's going to be a contested election and that it's going to drag on for months afterwards. And given the geopolitical climate and the adversarial climate that.

that exists between the U.S. and China and Russia, it's worrisome. And a great example is like this recent outbreak in Armenia and Azerbaijan, but you've got all these frozen conflicts all over the world. The Taiwan straight may be less likely. But you've got all these frozen conflicts that the U.S. has kept the peace in. And the U.S. has been sort of withdrawing from the world gradually in the last few years. It didn't just begin with Trump. But I think with Trump, it's been so haphazard.

and so disorganized and disorderly, and the messaging and the confusing messaging and the use of Twitter, it just creates this underlying anxiety and unease that I think we all feel. And that's what's so worrisome for me. Yeah, that's a very astute way to look at all of this. And, you know, when you talk about the contested election, I had this conversation with an American friend the other day. And, you know, his doomsday scenario is that. But basically there are these factions that start coming together between states that don't agree with the election results. And then from there, like what is the possible scenario there? Well, possibly, you know, on one extreme civil war, but some different gradients of that might even be like dissolving of Congress and the lack of trust in sort of like the Federal Reserve and like markets falling apart. So there's like all of these things that could potentially happen should this election be. contested and that contested aspect of the election, like, you know, dragging on for like a long period of time. States at the institutional level or the populations within states because of how they

break down politically? At the institutional level. Yeah. That's interesting. I haven't heard that theory before. Maybe it's a bit far out there. Well, I mean, like this, if you think, if you kind of, if you do this experiment of going back four years and putting that, I thought about this. Like, the debate we saw last night between Donald Trump and Joe Biden. I mean, it was disturbing. And I kind of went back and I was like, well, why was this so disturbing? I mean, Trump is Trump. But actually, if you compare it to 2016, and I didn't actually sit down and do that comparison, but just from memory, he was way more aggressive on this one. And it deteriorated way quickly. So I think that we continued to set new bars. And it's not just the case with Donald Trump. I think that's, and it's not just the case with Donald Trump. I think that. Donald Trump, I actually think of Donald Trump as like the alien from the movie Alien that like comes out of the body of one of the ship or the people on the ship in that scene, you know that like seen an alien, but it rips out. And I think the body is like the Republican Party. And he ripped out of the Republican Party in 2016. And he that's that now is like a steaming corpse. And if Biden in my view doesn't win in 2020, he will have done the same thing to the Democratic Party. The Democratic Party is going to go into. Oregon failure. And at that point, something's going to come out of them. And my concern is that something equivalent to Donald Trump will come out of the Democratic Party. So maybe we could just first introduce our guest for today. Yeah, we kind of slid right into it,

didn't we? So we're here with, we're here with Dimitri Kofinis, who is the host of hidden forces. And let's go back here. But I mean, I'd like to at least get a little bit of a context. for our listeners who don't already know you and telling us a little bit of your background and like, what were you doing before hosting Hidden Forces? And how did you come to be a host of Hidden Forces? Yeah, I'm like very much that guy that David Epstein writes about in his book range. I mean, I'm very much a generalist. I've always had general interest areas.

And it was always difficult for me to focus on any one particular thing. And in fact, when I went to college, one of the first things I told my mother was that I wanted to be a philosopher and she just freaked out. She's like, she basically thought that I was going to be poor and how was I going to live? She had this like idea of Socrates sort of, you know, bumming around the streets of Athens. But I studied, the things I was passionate about in college were political science philosophy and, and, and, and economics. And actually, I was most interested in foreign affairs and foreign policy and international relations. So when I graduated college, I initially had this intention to go to Brussels to work for the EU. And an opportunity came. And so I was studying French also. I think it was junior year.

I was studying French. But I didn't like French very much. So I actually was auditing an Italian class simultaneously because I had actually on a whim gone to Italy to study abroad for a semester. And I just fell in love with the country. So when I returned, all my free hours, I spent studying Italian. And I ended up getting a job working in Italy when I graduated college instead of going to Brussels. And you're originally from Greece, right? Or, you know, your parents are Greek. Yes.

Well, my parents moved here right before I was born. And I was born in Cincinnati, Ohio. and we moved around a lot when I was growing up, but we would always go back to Greece for the entire summer. And my experience in Greece was completely local. So all my friends were kids from local schools that would be out in the summer. So, like, I'm very, I feel very much Greek. And it was, it actually, I would say, like, Greece is the closest thing to home that I can think of

because we moved around so much. But, yeah, anyway, so I fell in love with Italy. I loved it so much. I really love that country. I'm so happy that I did that. I think anyone who hesitates to study abroad should not. It's just a wonderful experience. And I made so many friends there. So when I came back, I had basically a year of experience working in Italy, but managing off-campus real estate for NYU. So it wasn't directly connected to anything that I wanted to do with my life. And I didn't really know what I wanted to do with my life. So I, I, I, uh, I, I ended up getting a job in internal audit, which couldn't have been a worse job for me. And I kind of meandered around. After that, I quit not long after that. And I started a company in the video game space, which was a skill gaming middleware platform for the PlayStation 3.

And we really gave that a good shot. And we got licensed by Sony to develop on the PS3. We met a bunch of their top executives in California. We were at the GDC in 2007. It was really an amazing experience, but also one that taught me the dangers of venturing into a space that you know nothing about without someone on the team who actually understands the technical, the technical challenges and hurdles. And then from there I transitioned into application development and design for the interactive TV industry, basically set top box applications and next generation UIs. and that was for Cablevision, and I got to work with some really smart, brilliant people. But again, it wasn't really my calling.

It wasn't really what I wanted to do. And I tried for a little while to transition because Cablevision also owned AMC and a few TV channels. So they had like Mad Men. And I got to meet some of those executives over there. But it didn't work out. And I eventually left. And that's kind of where I found my way. And I was blogging at the time.

I was writing about financial markets. and I got this opportunity to host my own radio program on 9-1-5 in New York. And that was in very early 2011, and it was pretty much like a rocket ship after that. I got on TV a few months later, and I eventually got to create my own television show, which I produced and it was a daily live TV program at the market close at the market close on every day. And I did that out of Washington, D.C. until 2013. where I also, I've written about this, I had a brain tumor and I developed dementia. And so, like, I ended up getting brain surgery and radiation in all through 2013, summer through fall.

And the next few years, I was kind of, you know, trying to find my way again. And eventually, make a long story, slightly less long, I got to, I got the idea of hidden forces in my head around the summer of 2016. not long after I wrote a story for the Atlantic Quartz magazine about my brain tumor, which your listeners can read. And I got this idea for Hidden Forces, and it was so wonderful. I had so much wanted to feel inspired and have a vision, and I lacked it for so many years. And without it, I really, I had a difficult time. And so once I got that vision, again, it was like a rocket ship. And I just, I went forward and this time I owned it entirely. It was my baby. I didn't have to make any compromises. And it's been a really wonderful, wonderful experience the last three and a half years.

I was listening to this podcast earlier that's on your podcast that you did with these other two hosts. I can't remember which one it is, but basically you're being interviewed and you're talking, you're telling your story. I couldn't help but feel that there's something a bit metaphorical about hidden forces with regards to your tumor and the sort of hidden force that was in your, in your brain that was like causing this dementia that was there throughout your entire life and you didn't know it was there and could have quite likely had all kinds of. of impacts on your life, on your behavior, and on your overall being. And that was sort of like this hidden force. I don't know if you've ever made that connection. Yeah. Well, a lot of people when they found out I had a brain tumor, they're like, now it all makes sense. So maybe it was always affecting me. Yeah, I don't know, maybe. I think to the extent that my tumor was part of the story or part of the inspiration, I think, going through that experience and not just the

dementia period and the radiation and the surgery and all of that, which what really was transformative, I would say ever since the 2009 diagnosis, because I was actually diagnosed in 2009. So I lived with it for four years before I developed symptoms. And I lived with it for four years because the surgical options initially presented to me were so consequential and unnecessarily so that it didn't make sense to actually do it. But I think that that entire experience was, it was like transcendent. And I really came to appreciate the mystery of existence. I had what you would call spiritual experiences or religious experiences or awakenings of various sorts.

And of course I learned about as someone who has tried to control things very much in my life. And I think most people who have some level of ambition can relate to that. I learned the value of surrender. In certain instances, there's really nothing you can do. You can't fight the circumstances that you're in and you just simply have to surrender to them. And that surrender isn't the same as quitting. And so that surrender was also surrender into that mystery. and then letting the waves take me.

And so Hidden Forces, I think, was partly came out of that. And partly, I think it also came out of an active exploration of what it was that I loved so much about my old television program capital account and doing it and markets, effectively, which is that I think what is so amazing about financial markets is that they have this, the price in the marketplace is the epiphenomenon. but is the epiphenomenon, but underneath that there are hidden forces that are driving market outcomes. And we're always trying to understand what those are. And that, I think, applies to our entire lives. And when I was created the program, this is when you would hear a lot of conversations about simulations, you know, that we're at that period. People don't talk about that much anymore. But I think that's a great example.

And like, I was a huge fan of The Matrix. Like, for me, The Matrix was like, you know, Joseph, Campbell, before he died, talked about how our generation needed its own new myth that the old mythologies don't apply anymore. And I think that the Matrix was for me very much that. It was mythology that spoke to the mystery in a way, in a language that I could understand and that many other people could understand. Back in January, we interviewed Steve Kokinos and Sylvia Macaulay of Algarend. And during our conversation, we talked about how Algarand's unique design makes it easy for

developers to build sophisticated applications on their platform. So what's great about Algarand, beyond the fact that it's fast, it's secure, it scales, and it has instant finality, is the fact that they've designed a layer one protocol with primitives that are purpose built for defy. So what that means is that they've taken some of the most common things that people do with smart contracts and they've embedded them right in the system, right in the layer one. So things like issuing tokens, atomic transfers, well, these are built into the layer one. And smart contracts are first-class citizens on Al-Grant. So with these essential building blocks at your disposal, you can build fast and secure DeFi apps in no time.

To learn more about what Al-Gran brings to the table and how to get started, I would encourage you to check out Al-Gran.com slash epicenter. That lets them know that you heard about it from us, and it takes you where you need to go to learn about their tech. And with that, we'd like to thank Al-Garand for supporting the podcast. So tell us a little bit about Taylor. forces as a podcast and what kind of guests usually have on it. Because, I mean, if you look at, you look at the rotor, it's incredibly eclectic. So what kind of brings it all together? I think at first the reason why it was eclectic was not just because I was interested in all these other subjects, which I was. But I think I was also animated and motivated to create a podcast

that really pushed the boundaries of what people thought was possible in terms of. terms of exactly that type of general but deep to be able to talk about all these different topics. I mean, like one of the early podcasts was on Space War, which actually turned out to be very prescient. And I think what pulls it all together is, well, I think that there's an honest quest for me that is very much subconscious and I don't really understand it to understand the world. And so most of the episodes, not. all because sometimes there really are, there are episodes that I did, for example, that were biographical. Some of them were relevant, like the episode on, on, on, on, on, on

Greenspan because of his role as Fed chairman, but the episode that we did on Claude Shannon, even though information theory is relevant, Claude Shannon himself, his, his story, wasn't necessarily part of that. But I think that it's just, I just think it reflects my internal seeking, you know, trying to understand this world, which is so, complex and which contains so many bodies of knowledge. I mean, that's the other thing. You know, a thousand years ago, it was actually possible to know all that there was. You know, like you had those, those Enlightenment scholars who studied antiquity and they could pretty much get their hands on most of what existed. Today, there's just so much knowledge. And

crypto is a great example, you know, to bring it to crypto. I was working on a thought piece yesterday on on defy on decentralized finance and I hadn't touched the stuff for like you know a couple of months because I had it was the first time that I'd covered it was with Vance and Spencer who are the framework ventures guys and I just was like man when did all these new projects come out like what does this do what does that do and and you're also in an adversarial information environment because like 90 to 99 percent of the stuff that you're seeing is total bullshit and it's meant to to swamp your your senses, you know, and make it difficult for you to do analysis. So it's difficult to weed through all the crap. And so, like,

again, it's just there's a huge information environment. And I think to the extent that you can navigate that effectively, you can be successful in life, not just professionally, but everywhere. So there was, I guess that's the best way I would describe it. There wasn't a conscious idea of like, let me do philosophical mathematics. Let me do an episode on anarchism. Because I see how the two tie together. There was a sense that they did tie together, but I was willing to trust my instincts. There are some episodes about crypto.

Actually, the way that we connected is you did an interview with Camilla Rousseau, who we also had on, and you mentioned Epicenter during the overtime. I was like, oh, he knows about Epicenter, and I reached out, and then we kind of went back and forth by email. And what's interesting is how many times you've covered Hashgraph on your podcast? It seems like you've done it. I'm a seat investor in Haschraft. Oh, okay. That makes sense.

So I'll tell you the hashcraft story. I was at a Goldman Sachs Crypto Working Group, was the first one they put together in the very early fall of 2017. And next to me was sitting someone who was an investor in Swarolds. And I didn't know that. But he gave me, he sent me afterwards Lehman's white paper and I read it. And first of all, I was just coming into. the space, pretty new to the space. And there were just something that felt really compelling about it and that made sense to me. And so I did an episode on it, episode 22 with Lehman Baird, and then I put on an event at the assemblage in New York, which was now, goes back to October of 2017, so three years ago. And so I got really excited about it. And they gave me an opportunity to invest in the seed round. I never sold my investment. I've kept it. That's both because I

do believe in the team and also because I have a moral obligation to my audience to not, you know, not just make a quick buck off something. In fact, actually, I own more than I did when I first invested because I've locked up what I own. That's sort of how my, my story with Hedera Hashgraph began. They obviously have taken a very different approach, which is not super popular with people in the crypto community. And also, they don't have the same type of like community engagement of some of the other projects. So there's not really much for me to do or to participate. And one of the reasons that I invested was because not just because I was excited about it and I really took to Lehman and Mance, but because it was a way to kind of get in and learn about stuff. And it really

was. Like I learned a lot from Lehman. And so, yeah, it was a way to kind of learn by doing and have skin in the game. Because I was never, I own Bitcoin now, but very little. And I was never really excited about Bitcoin. It never really did it for me for all sorts of reasons that I can go into. The Ethereum community was much more interesting because it was a community of builders. But I think like every project in the ICO boom, there was a lot of naivete, a lot of scams, obviously, a lot of ambition that didn't really reflect reality and the technical constraints. And again, that's why I enjoyed Hedaira Hashrived because, or why I was drawn to it, because they, oh, there were a lot of project. that were doing this, but they were speaking to and trying to focus on overcoming the scaling limitations. And so it got me to learn all about that in a way that I wouldn't have otherwise.

Can I just follow up on that? So I see you as a knowledgeable generalist who has a super deep interest in society and technology and the like, but you are not deeply embedded in the blockchain ecosystem. So from within our bubble to us, it often, it kind of looks like crypto is definitely going to change the world. And, I mean, you kind of see it from the outside. And you habitually think about the economy and the government and society and technology and how they all loop together. How do you see the impact of blockchain at a societal scale pan out? That's a really complicated question. Well, I'll say I first learned about Bitcoin.

It was either 2011 or 2010. And then I learned about it from Max Kaiser. So Max Kaiser, I think Max, in his own way, is very brilliant. And so I knew about it. And I had actually been to a Bitcoin meetup in like January of 2013. And so, like, I was interested in it, but I never really took the time to try and understand it. And I also, I guess, yeah, I think that's mostly why I kind of let it go at the time, because at the time I was more of a pseudo-libertarian. I'm much less so today. So I think politically I aligned very much with the crypto ethos. And I certainly have strong feelings on the importance of sound money and what our monetary authorities have done to not only forget trash the value of money. What they've really done is that I think they've wreaked havoc on asset prices and on the, the mechanism of capital allocation that financial markets are supposed to to play. But when I got

into it back into it in 2017, I think my first guess was Andrew Keys from consensus. I think, one, the idea that we could escape to some degree from our corrupt government institutions was appealing to me. And to the extent that that's possible today remains appealing to me. So the whole ethos of decentralization and with big giant bold air quotes was appealing. I think also it was exciting. I had been going to meetups actually in the city going back to 2015 to IOT meetups where people were basically doing D.YI drones and other types of devices and machine learning meetups and other such meetups. And I also went to blockchain meetups. And it was an exciting community, like this community of builders, people excited about the future, very focused on making positive change. And that was infectious. And I think that's ultimately what drew me in. And I think over time, I've come to have a much more sobered view of what's possible or at least what I need to see before I can upgrade my sense of what's possible. But I still think there's a role for these technologies, these distributed ledger technologies to play. I just think,

I think it's a, it's more of a, let's see. I'm less willing to jump far out and make, make bold claims. But I think that like a lot of technologies, they go through this initial hype cycle and they're way, you know, we have this expectation that things are, this same thing happened with OTT over the top cable. And I saw it for my time working in video games and in the TV industry. I think people were expecting that people were going to cut the cord way sooner than they did. But now eventually we got here and people have cut the cord. So I think that it's, It's definitely a field that's worth being in. Unfortunately, it's dominated by scammers and not just scammers, but just people just pumping the shit out of coins that may not necessarily be scams. But in that sense, honestly, crypto is no different than our entire Ponzi economy. I mean, what are our financial markets, but not a giant Ponzi scheme? So would you mind elaborating? I mean, we've had this conversation over email. I would love for you to talk about, well, I mean, how you proceed the economy to be like this kind of Ponzi system as you describe it, and then how that relates to some of the exuberance we see in crypto.

I don't even know where to begin on this one. Well, let's maybe start with the current economic context and the financial crisis we find ourselves in. I know, I think that there has been a gradual hollowing out of the American economy and an increased financialization of our economy. And on a very fundamental level, if you really understand what capital markets are and what function they serve, their job is to help allocate capital to the most efficient private sector actors who can use that capital to create productive capacity and grow the capital stock of the economy. And that is fundamentally what is supposed to be reflected in stock valuations. And of course, stock valuations always go through periods of booms and busts of overvaluation and undervaluation, but there's always been this sort of tenuous relationship to underlying reality. Even during the new era of the 1920s or the new age of the 1920s or the new paradigm economy

of the late 90s, the bull market story was very very. very much focused on the future and was an exuberant interpretation of innovations that were going on in the economy. What's alarming and deeply disquieting in the same way that, in not the same way, but raising some of the same feelings for me that the debate raised is that the story today to justify participation in financial markets and to justify asset prices. is actually not based on any irrational interpretation of the underlying economic data or where we're going to be going in the next few years. It's entirely based on this idea that markets are simply a political utility, that they are simply a place where public sector actors, primarily the Federal Reserve at this point,

act in order to sustain prices, that they're just simply a feeding. trough for people with 401ks and people with stock market portfolios. And that's so incredibly scary because the markets are fundamentally broken. They're no longer actually serving their purpose, which is to efficiently allocate capital in order to grow the economy. And without the economy growing, eventually, it's just like the desert of the real in the matrix.

You could be in a matrix. Everything could seem fine, but the outside world is, you. is charred and burned. So like we cannot live without the world. You know, we cannot live without resources and a real economy. And I just feel like what our authorities are doing is they are going at this point they, I don't know if they can really go back. I don't think they can't actually. You know, they're just not. It's, they're going to go for broke because they're fully invested at this point. And central banks are basically, they've got their handcuffed to the wheel. And they're just going to drive this thing right off the cliff. So, you know, you.

You know, I think, yeah, that's my kind of short answer. I can elaborate, if you want, on different points happy to. Can you maybe clear up for me? You said that the Fed or other central banks kind of posed this. So how would you say that they cost this? Is this just a matter of making capital super cheap? Or are there other things playing into it? Yeah, so I definitely don't mean to suggest that it's only central banks.

but I think that central banks are marginal actors, and to the extent that they are marginal actors, they can have a really important impact on the economy and on markets. I think this is like really multifactorial. I mean, the best starting point for me is usually going back to the late 60s, early 70s and eventually with the unpegging of the dollar to gold and the financial deregulation that started in the late 70s through the 80s. and I think also, of course, the liberalization of trade and the adoption of the kind of neoliberal consensus as a working form of economic logic for how we conduct foreign policy and trade relations.

And I think also technology has had a powerful deflationary force on the economy. And all of those factors, you know, it's so interesting for me. And I don't know if this is because I was born in the early. 80s and I was in high school in the late 90s and I was in college in the early 2000s. And so this is like kind of, they say that those years are the years where you form, for example, your favorite tastes in music, that the songs you hear in your, when you're 19 or 20 are the songs you love for the rest of your life. And so maybe I'm ascribing too much, too much value to the late 90s and the early 2000s. But I think that the 9-11 attacks from a political standpoint were, and generally

were the most consequential events, the response to those events were the most consequential for the path of American decline. And I think the late 90s, the way in which Greenspan responded in the face of not only the exuberant markets, but also things like long-term capital management and the use of, and the tequila crisis and the use of the Federal Reserve to smoothen volatility, in financial markets. I think, and actually to go back to the point I was making about deflation and trade, Greenspan relied on what he was seeing in prices, which were partly being influenced by the deflationary forces of trade and technology.

He was relying on that data to make an assumption about the efficacy of raising rates in the face of low inflation. And so he continued to keep his foot on the accelerator. And I think that combined with the Fed response, which may have been justified to the 2001 terrorist attacks, then again, subsequently the prolonged period of low interest rates and enormous balance sheet expansion post-2008, coupled, of course, with the malfeasance in our political system. I mean, anyone who saw people like Hank Paulson and I don't want to name names because I don't want to make it personal because it's not really personal. But anyone who saw how our system operated in the face of the 2008 crisis, I think cannot seriously say that we don't have a deeply compromised political system. And people saw that. So the combination of the political malfeasance along with monetary policy in the face of the liberalization of trade and the deflation caused by technology, I think all of those things have led to a hollowing out of the real economy.

me an accelerated hollowing out. And I think a disenchantment by the public and a sense, I've talked about it in terms of market nihilism, but a general nihilism, a sort of whatever, it's all a scam, markets are a scam, the dollars of fiat shit coin, just own the Ponzi, you know, love the bomb and just go with it. And I think that's kind of what's happened. And I think when I watched the Biden-Trump debate, I see Trump as like an agent of chaos. that is here to reap what we've sown. And that's what I saw in that debate. And I think that many people in the country don't give a shit.

And they understandably don't because they're so angry. And human beings, we're not rational automata. We're understandably emotionally motivated. And people are just angry. And they want to see it burn. So I'm afraid that that's where we are. And I just worry about the international components of this. Because if we didn't have to worry about all of the,

these frozen conflicts and all these tripwires in the international community and these countries like China and Russia, we could figure it out. But my concern is that we're in a really bad place. We're backpedaling and we're facing competitors who are very strong and very capable and they want to hurt us. I agree with that and I definitely have similar sentiments, this nihilism that you describe. It's something that I personally feel like on a pretty regular basis. It's almost like watching sporting event or like a boxing match or something. It's like for entertainment value. And then that extends also to the entire shit show, which is like the rest of the world right now.

But the thing is I would say, Sebastian, and sorry to interrupt, but I do want to say this, I think that's true for how political debates have been for a long time. They've been these political contests. And the television media has really profited from doing that. They've driven that. I think what was so scary about this debate was that Trump pierced the veil. And he pierced the veil from it being this W.W.E. show contest to like the moment where the guy just broke his neck and he's stabbing him in the neck. You know, it no longer felt like it was controlled. We really were seeing the collapse of the pretense of political decorum and civilization right in front of us. And that's what I found so honestly, terrifying. But see, to me, that kind of extent, that that extends to...

the entire kind of political discourse right now, not only in the U.S., but also all of these insane notions that, you know, five, ten years ago would have seemed absolutely insane. People are saying out loud. I'd like to come back to the crisis and get your thoughts on, you know, like, I think people who are not in the weeds of this thing will look at a financial crisis and look at another and just say, oh, it's just like another financial crisis, right? Like, they're the same thing. Just there's one that happened 12 years ago and like one's happening now. Like, what's fundamentally different about this financial crisis and how institutions are dealing with it?

And what are those ramifications for the future? Like, for the next 10, 15 years, you think? Wow. So let me just comment on the point about the EU before I go to the question. I might have to have you reask it, actually. But in terms of Europe, I think, yes, there's been a strong. strong secession fever that we've actually seen going back to the early, there were pockets of this going back to the early 2000s. I do think ironically, with the retreat of American

power and the damaging of U.S. EU relations, I think that ironically, that could actually lead to further European unification and solidarity. So I think that the EU currently is one of those places where I actually feel somewhat bullish on unification. I actually think that they can hold it together so long as they have the right leaders because they can see the value of a unified Europe. But that really does depend a lot on the French and the Germans, as has always been the case. Could you just ask me again that last question you had? The question is, like, how different is the handling of this financial crisis compared to the 2008 crisis and what are the consequences of the fundamental difference of how that crisis is being handled by institutions? I mean, the 2008 crisis was, it was a crisis not unlike crises that we've seen before in that it was a banking crisis.

It was a crisis caused by excessive amounts of credit. Whereas I think that this crisis today is totally a political crisis. You know, I mean, in 2008, there wasn't an expectation that the Fed was going to do all the things that it's done. There was a deep fear that we were going to have an economic depression because that's what happened the last time this happened. I think that because of the Fed's reaction and the government's reaction in 2008, they basically took ownership of financial markets and capital markets. And so now when markets look like they're going to decline, it becomes a political problem. And that's to the point about markets being a political utility.

And I think that's a term that I stole from Ben Hunt. I don't know if I did, but in case I did. And so I think that what we're actually dealing with today is not a financial crisis, but we're dealing with today is a political crisis. because markets are they're like near an all-time high, aren't they? I mean, I don't really check regularly, but we were near again

or we overtook again all-time highs. I mean, we had an insane rebound in the middle of a pandemic with elections coming up where you might get a Democratic candidate who's going to raise taxes, which you would expect would cause people to sell a bunch of their stocks

so they could take some profits before taxes go up and all the other uncertainty that comes with that, all the geopolitical assertiveness we've talked about, But because the Fed has been such an omnipotent force in the market, people's feelings about risk have to take a backseat to the reality of Fed power. But the Fed's not really isn't omnipotent.

So there comes a point at which our concerns that would make us want to sell financial assets overwhelm the Fed's capacity to, one, sustain them and to sustain them in the face of a dollar that. continues to hold its purchasing power. So it doesn't end well. And that's what I would say is the difference between where we are today and 2008. 2008, we could have really done something and our economy could have actually been stronger coming out of that. But not today. So you say it doesn't end well. Maybe let me kind of riff off of that. So to me what's truly remarkable in this crisis is that it's actually several concurrent crises that are happening at the very same time. So basically it's the corona epidemic, it's the incredible unemployment, it's the trade wars, it's the tangible effects of, you know, changing climate. So the US running out

of letters to name the hurricanes after the disturbing wildfires. And then it's the racial inequality and the class divide that kind of spur this entire Black Lives Matter movement, and rightly so. And I mean, basically, you can, it feels from the outside the pictures that we see over here in Europe. It looks a lot like the start of a, you know, a civil war that's kind of incited by the president. So a couple of years ago, actually in the primaries for the last presidential election, I read a book, Collapse by Jared Diamond. Yeah, so basically it's about, just for this, it's about societies and how they collapse and why people don't see it coming as

societies are collapsing. So why are people cutting down the very last tree if it's, you know, a fisheries based economy and so on? And basically the point that Jared Diamond makes is that it's super difficult to actually see this while it is happening because it feels so normal. because most aspects of our lives don't change during collapse and it only becomes, it only becomes apparent afterwards. So this is my very long-winded way of asking. Do you think the U.S. and the word as we currently know it with U.S. as, you know, the mightiest force, do you think we're in

the mid to early stages of collapse? That's a very great question and a very difficult one to answer. I actually want to tell your listeners that I read an article a few days ago by someone named Indy Samaravija. I'm so sorry I messed up the name. She wrote the article for, I think, on Medium, and the article is called I Live Through Collapse. America is already there. And I quoted part of the article and I tweeted it out. There are a lot of really quotable parts of the article, but this is the part that stuck out to me. It relates directly to your question.

America has already collapsed. What you're feeling is exactly how it is. It's Saturday and you're thinking about food while the world is on fire. This is normal. This is life during collapse. And that felt very, very much like what we're going through. You mean like this denial? Is that this sort of denial of what's going on it around you?

Not so much denial, but not so much denial. But what is it? I'm sure there's a turn for it. in biology or behavioral psychology where you adjust your sense of normalcy based on, you can very quickly things become normal. And I think that's probably an adaptive condition because it's a lot easier to survive if you don't have to constantly feel like everything is abnormal. So I think that we just all just quickly become accustomed.

And a great example is like that debate. If you'd see in that debate, first of all, even then, that debate felt like a dark comedy. But that debate didn't come out of nowhere. It came after 2016, already changed our conception of what was possible in debates. And I think that's the case for everything. And so I don't know that there is some, like, moment where we know it's collapsed. It's just collapsing. So I guess to be honest with you, if I gave you my real answer, and I hate, I really try not to do this because I feel like it's so easy to do it because it gets clicks and views.

I genuinely feel like we are collapsing. That's how I feel. I feel like America is collapsing. And I don't really see any way, just like the financial crisis in 2008, the idea was those people that were trying to actually use monetary policy to positive effect saw it as a way to create an orderly unwinding of global balance sheets, an orderly bankruptcy, if you will. But that's not a way. But that's not a way. The not actually what happened. So I think the best we can hope for is an orderly unwinding. But my concern is that this comes back to the geopolitical stuff. I mean, that's my biggest concern. I think that we're in an environment today that feels a lot like both the interwar period and pre-1914. Because the interwar period, you had all of these economies in recession or depression, and you had rearmament in Germany, but you didn't have this idea that war was not going to happen again, or it wasn't possible.

You just went through one. Prior to World War I, the European economies were booming. And the view at the time was that the interdependence of economies was so great that no one would rationally go to war. Why would you risk all of that? And on top of that, you had the, The other thing with World War I, which was that you had a massive advancement in the technologies of warmaking. The Belgians were still building castles up until the breakout of World War I.

Those things were completely decimated by German tanks. I mean, the Russians were sending cavalry out to the front lines. So, like, that's where I'm concerned that that's where we are today. We haven't fought a war. The West hasn't fought a real war like the kind we're talking about since World War II. so even longer than with Europe and its skirmishes. We've got technologies that are more destructive than anything that we had back then in terms of the change of what there was and what came with steel and industrialization.

The battlefield has also expanded today. Back in the 1910s and 20s, the battlefield was still where the soldiers were. That's where the action was. Today, with cyber weapons, with political misinformation and active measures, the warfare is everything. The entire world is a battlefield. And so I'm very concerned because I see these combined risks. And we've got a president who says crazy shit on Twitter. Even if you like Trump, if you're not really in the camp of the nihilist that we've talked about,

I don't see how you can think that his tweets are. safe or intelligent. They're completely reckless. You don't even conduct corporate policy by you would take, you would, if you had a CEO like Donald Trump, the board would take his phone, except if you're Elon. Don't even get me into that conversation. But yeah, I mean, that's, that's, honestly, that's, that's my take. Wow, I didn't think we would, we would get to this point, this depressing reality, potential reality. Well, you take a look at, I'll say this. I just recorded an episode yesterday or two days ago with Ian Easton of the 249 Institute.

And it was a conversation initially meant to be on Taiwan. I mean, it was on Taiwan, but of course that drags in the U.S. and China. And one of the questions I asked him, and his answer sort of made me kind of appreciate this more deeply, which is I asked him like, why is Taiwan so important to the CCP? And I asked him a follow-up, which was why it seems that symbolism and symbolic victories are so important to the CCP. And what he said and what I took away from his answer was essentially that because the Chinese Communist Party is not a democratically elected government, it doesn't rule by popular mandate. And so the way in which it gains its legitimacy is through fulfilling goals, being able to point and say, see, we're said we would do this in five years, we did it. See, we said we're going to raise living standards.

We did it. And also, to the point about Taiwan, because they don't have a popular mandate, they don't want people in the mainland to look at Hong Kong and to look at Taiwan and take anything from that and say, well, maybe if Taiwanese can live independently, maybe if the Hong Congress can have their own system, then maybe we can have some more as well. And so they're fundamentally unsafe. And because they feel so fundamentally unsafe, they're constantly provoking. They're constantly looking to exploit and to expand. And the Russians also in their own particular way have this. And so I don't see how this is such a delicate issue. And that's, again, that's what worries me. It's not just that we're falling apart. It's that we're dealing

with two governments in the case of Russia's Putin's Russia and the case of the Chinese Communist Party, parties China, that are fundamentally insecure. and need to push outwards. And that's what concerns me. And they'll be there to pick up the pieces after the collapse, right? I mean, that's kind of the, I think the big risk here is that in absence of power, you know, these forces can come in and take over, that void of power. But, you know, when that happens, at least we'll have like perfect security also in Europe

in the U.S. and we'll get cheap iPhones and, you know, all those things. There's that nihilism again. It just keeps creeping up. I want to come back just to this, before we get in a little bit more into crypto, I do want to come back to the Fed a little bit. And I heard your recent interview with Bill Nelson, which was great. And we talked earlier about this perception that the Fed is propping up markets. And something that he said in the interview, which was interesting, was that one of the Fed's mandates is to reduce unemployment. So in a context where unemployment is high because of forces that just simply the Fed cannot, doesn't have any power over, like a pandemic, for example, like the proliferation of artificial intelligence and things like that, what becomes the role of the Fed if it can no longer, or central banks just generally?

I mean, this is more of a question about like the central banking model and its potential collapse. What is the role of a central bank if it can't do the very thing that it's meant to do, which is to make sure that people have full employment and keep interest rates at a bearable level? So I think the Fed's interventions in markets are really an imperfect reaction to – or a reaction to an imperfect situation, which is that fiscal policy has not mobilized in order to try and around. best the declines in asset prices and to try and equilibrate the gross in equilibrium that have been generated from wealth inequality over the decades as a result of many of those forces as well.

So I think this vision I had in my head is like this vision of like a paperclip factory trying to build a dam because the people with the wood aren't coming. And so, like, I don't know, I'm sorry, Sebastian, if I didn't quite answer your question. I don't, maybe you can rephrase it. I mean, was your question basically why is the Fed, I think I lost. Well, what is the role of a central bank moving forward when the conditions in which central banks were, you know, were created for are totally different? You know, like the realities of the world in which central banks exist are totally different. Yeah.

So the central bank is playing a role that it was never designed to play, and it cannot play. that role well and it's going to destroy itself in an effort to do it. I think their intentions are well-meaning to a degree, but I don't think the fed's, let's be very clear, the Fed is not there to serve the public. The Fed is there to serve the banking system, despite what anyone says. That's not why the Fed is there. To the extent that it serves the public, it has, because it has some, it has some popular mandate insofar as it's a political institution, but it's not there to serve the public. So, you know, I mean, yeah, that's my answer. Do you think there's a role for crypto to play in this context? I mean, there's ideas around UBI's universal basic incomes that same-euroidge based. So basically

the money that currently is created for the banks or that the banks can create because they're allowed to print money and lend it would go directly to the people. And do you see a way that crypto can or will fit into this? I don't understand exactly what you mean when you talk about Signorge rights. Are you saying that by having a cryptocurrency that basically gives the gains of inflation directly to the public as opposed to... Exactly. You know, I don't know.

I'd have to really think about that. I don't know that that's really the issue. Actually, I find the focus in crypto on finance and money to be just an extension of this broader phenomenon of financialization and the growth of our Ponzi economy. I think Bitcoin's ambitions were sound, no pun intended, but we've strayed very far from that. And I think that a lot of what, a lot of the stuff that drew me into crypto in 2017 when we talked about the developer community and Ethereum, that also would have been promising and interesting. And projects like that, I think it could add to real economic value. But the stuff,

Stuff like Defi, I mean, right now, everything in Defi that I see is just a way to, it's an exploitation of the non-regulated landscape of Defi. I think Defi's greatest competitive advantage is that it's not regulated. So you can create a platform like synthetics, which is basically a derivatives platform options market and not have it regulated by the CFTC and the SEC. And I think that what I'm seeing today in Defi are basically tools of speculation. So it's actually kind of disappointing. And I think what would be encouraging about crypto to answer your question, like, is there a role for crypto? I think to the extent that you could have sound money and reliable currency, the problem, of course, that Bitcoin has been the issue of scale and actually having a payment system that can work, that can be secure and that can actually process transactions at a scale that could lead a lot of merchants and vendors to use the platform. and then otherwise it would be, it would be wonderful to see a lot of the kind of the stuff that

was promoted in 2017, a lot of these daps to begin to actually solve real world problems. Because again, I think the emphasis should be on the real economy and our political institutions, not on financial markets and not on money. I don't think the problem is, I mean, if you created some alternative money right now and central banks have fucked up the economy so much and governments have messed it up so much, that we have bigger problems to solve. The money issue, I don't, I'm not one of those people that believes that you can have that Bitcoin can be successful without some level of buy-in by the government at the kind

of scale that would be like transformational for society. Though I do think that its presence, its existence, just like gold, does have a, can have a powerful impact. But I don't think Bitcoin has that role today. I think gold does, but not Bitcoin. Can you give us an example of some of the depths that were advertised in Twitter? 2017 that you think would contribute value to society? Yeah, I mean, you know, off the top of my head, it's hard to remember a lot of them now.

But like we talked about Hedera hash graph or we talked about Ethereum. If you, if you, for example, I mean, like, I think like identity, you know, applications dealing with identity and helping people gain control their data, being able to. to determine if a file has been altered. You know, like one of the things that I've talked about on Hidden Forces is the incredible vulnerability of hospital systems in the U.S. Like some insane number don't even have a firewall or a single dedicated IT person. And yet they have so many of their machines plugged into the Internet. And you could just scramble blood records at random hospitals in the U.S. on the day of surgery.

people start dying on the table and you don't know what's causing it. And so the ability to know if a blood record, for example, has been altered could have a meaningful impact on people's quality of life. Stuff that's actually meaningful. But it's been a while since I looked at a lot of that stuff and I'd have to reevaluate my expectations based on what I know today if I look at them now. I think maybe this is me as the eternal optimist speaking. To me, the ecosystem currently also has a very casino-like feel, and I'm not loving it.

I don't think it's 100% true to the original ethos, but I do think it is complementary in that the experimentation that is currently going on with real money stakes kind of gives us a data treasure trove for how people behave. depending on where incentives are and how liquidity moves and so on. So basically, I have kind of filed this under experimentation, and basically I think it's good things are going to come out of it. I think it's kind of, you know, this level of exuberance that basically whatever button you hit with sushi or pickle or sauerkraut or whatever is.

The latest craze, you make money. but I think that the data and the behavioral economics data that will come out of it will prove super valuable to the space. Yeah, I mean, you raised an interesting point early on about incentives. And since you're being the optimist, I'll be a bit of a pessimist or a cynic on this one, which is that, and this kind of ties into this libertarian, anarchic ethos of Bitcoin, which I think is actually misplaced. You know, like certainly governments, and this is even more true of governments around the world, are to some degree or another corrupt, wasteful, et cetera. But we actually have a really great track record in the United States of government having played a very constructive role for innovation and economic growth. I mean, from World War II through the 1950s, 60s, and 70s, the United States.

the United States with different arms of DOD was instrumental, along with universities in the U.S., to fund all the different components that gave us the digital revolution, from silicon chips to software to the internet, from which the private sector continues to derive value to this very day. And I think that what we're seeing in crypto is a community of open source protocols that are attempting to fund their internal development by relying on financial markets as opposed to having an efficient pipeline of capital where they can work in solitude. And when I say solitude, I mean without the shit coin pumpers and dumpers coming in and out and feeling like they're owed something. from the price of a token whose real primary function in a healthy economy is to fund innovation and to fund development of underlying technologies that can actually meaningfully impact and grow the economy. And so I think the irony is that the philosophy that animates crypto, besides being, I think, fundamentally incorrect, is also very much a, it reflects the failures of government

to actually play a constructive role. And so in terms of incentives, I think it's not actually very beneficial for the most part that all of these applications are funded by tokens that trade on exchanges and that people look at as ways to get rich quickly. You know, like, I don't know if you guys saw that that ample coin thing that came out a few months ago,

but I did some digging into that. Before that thing started to go south, I don't know where it is now. I actually came to a very clear determination that this was pure bullshit. And I know that as a fact, and I won't go into all the reasons that I know it, but even when I looked at the white paper, I was like, this is, and I don't necessarily think that the creators were trying to scam anyone. I think that perhaps they were sort of, that they saw it as a convenient way to get rich. But I think they, I think they were, and I think they were conveniently ignorant about what they were suggesting from the white paper. paper. I remember now exactly, but I did a deep dive into it, and I totally saw that this does

not make sense. It does not work. It completely misses entirely how markets work and how prices are formed. And that's just one example of something that's created to supposedly to solve a real world problem, but it's actually, it's just a way to get rich quick. You know, I kind of went off a little bit on that one, but the point is that that culture is so powerful that it infiltrates projects that are actually trying to do real work. And again, it's part of this whole race to the bottom. It's just like the world on fire type of mentality. I was going to say, it kind of circles back to this kind of world on fire mentality.

And yeah, I don't have very formed opinions about Ampleforth, to be honest. We had them on. Oh, you did, really? Yeah, we had them on. But even after listening to it, I still didn't really have formed opinions about it. So basically, Sunny and I had him on, the CEO. We had Evan on. We gave him a hard time because we also.

thought it didn't work, the entire rebase mechanism and basically kind of, it's just a way of dividing up. I mean, basically, if all, if proportionally everything stays the same, it doesn't matter what the denominator value of something is. Anyway, so we gave him a hard time. What to me was, stood out about that project is the backers that it had. Because, I mean, there are scammie, there are tons of scummy projects in, in this space, ones that just don't work and ones that malicious.

But that one had really good backers. So basically they had a lot of Stanford people on the team. They are backed by Pantera and FBG and True Ventures and the great funds in the space. And somehow they signed up for this. And to me it's not clear whether it's malicious or whether they just didn't give it enough thought. But it was so, it was so the white paper was, the white paper was so stupid. They had terms like macroeconomic friendliness, volatility, fingerprint. I mean, it was so obviously scammie that I just don't think that they couldn't know on some level. And also the way that

they talked about how they were going to adjust, how the protocol applies countercyclical pressure. I'm actually looking now, I wrote out this piece. I was going to publish it and I decided not to because honestly I didn't want to like, I don't know, I just didn't want to. But it was like, the step function like market cap curve that alters between dynamic states and equilibrium states. It was so full of misunderstandings, misinformation, bullshit, techno babble terminology. And like you said, and it had these like these sponsors who were, this just goes to show you.

I mean, look, Nicola, have you guys been following the Nicola story? I mean, GM has like a, what is like a $2 billion investment? And Nicola is the other sort of electric or hydrogen car. battery manufacturer that's trying to compete with Tesla. And their CEO has had to resign. It turns out everything is a giant scam. He bought the entire design from some guy in like Croatia or Serbia. Like it's insane.

The level of scam is insane. Just like Elizabeth Holmes. Elizabeth Holmes, you had Tim Draper was an investor. And you had like, what was it, George Schultz, or as George Schultz passed away somebody. Some former defense secretary, Secretary of State was invested in the project. It's crazy. But it makes sense. When you think about the larger macroeconomic financial picture, which is that economics fundamentals don't matter.

What matters is the story, the narrative, and the Fed. So of course you're going to get people that can't look at a balance sheet or can't read a white paper and say, what macroeconomic friendliness? What the hell is that? You know, and just say, I'm not going to get out of my office. Who let this person in? Fire my secretary. That's what a normal reaction would have been in 1970.

But not today, you know, because, you know, it's just like the due diligence on Wall Street in 2007. Same thing. I want to ask you about cryptocurrencies as a reserve currency. And so we've talked about this on the podcast before. And actually, so we had Jim Bianco on a couple of months ago. He's the head of a research institute on financial markets. His vision is that the cryptocurrency that could become the world reserve currency, doesn't exist yet. It's not Bitcoin. It's not Ether. It's probably not Libra. It's probably something that

will come at some point in the future. Do you share this view that a cryptocurrency, a non-state governed currency, could become a world reserve currency? And how different would that be from anything we've ever known in terms of like a monetary ecosystem? That's a really tough question to answer directly. So I'll start to answer it obliquely. I think that, yeah, I suppose it's possible. I mean, in a sense, gold was for a long time international money throughout the 19th century and into the early 20th. However, I don't know that it can be completely independent money. Again, I really question that narrative because governments are very powerful. And I did an episode actually on this where, my guest and I talked about his arguments for hyper-bitcoinization, and I just felt that I think that those arguments that are made by Bitcoiners, they're kind of like, they're very ideological and they don't fundamentally adhere to reality. So I think that the right currency, sort of a scalable, secure, highly performative money could actually be very successful in the

world, but I don't think that it would come without some level of government regulation. That would be my bet. Yeah, I mean, of course, regulation is one aspect, but like proper control, I think is a totally different component. Well, maybe in other words, when I, okay, so let me rephrase that. The question is when the United States was on the sort of quasi gold standard of bread Woods. Was it on that standard only because it provided some kind of constraint? Or was it also because we needed to have dollar bills, we need to have a currency that could circulate and you can't have pieces

of gold circulating. And so if you don't have the pretext of needing to have some kind of some kind of currency that can circulate, would there be a sufficient cause to create an intermediary currency as a government to sit between Bitcoin, between the sound money, in this case if we're using Bitcoin, and the final user, or would you just basically end up having the equivalent of like the Bretton Woods gold standard, or not the Bretton Woods, the classical gold standard, and everyone actually transacted in gold because you didn't actually have to have an intermediary currency. I don't know. I don't know. All I would just say is that I find it very difficult to imagine that governments who are the most powerful entities in the world, not a protocol,

they have the capacity to exert force on people. I just find it difficult to imagine that they wouldn't find some way to get their cut. I just think this is a constant force. Maybe last question and as we wrap up here, and I know this episode has been slightly, for some perhaps slightly depressing, but what is your sort of positive outlook on the future, maybe post-2020, what's like a positive scenario in your view? Do you have a positive outlook? If you have one. Yeah, yeah. So before, and in case I forget that, let me just say one more thing because I forgot to say this, because it was my most. profound realization when I studied ample fourth.

Because it came on my radar because someone I know who I really, I really like, he's kind of a 26 year old millennial or zoomer. And I rely on him to get kind of that particular perspective. He put this on my radar because he was making a shit ton of money. And actually this kid texted me a couple days ago. And he was pumping some other coin. I want to find it. But anyway, he was making a ton of money and all of a sudden he like a bunch of it got like stolen or got scammed or something.

I don't know. Anyway, so he's always kind of experimenting with these pumps and dumps. And he was making a ton of money with Ampleworth. And so I did this analysis. And then I decided after I was done, but I actually don't know if it really matters. Because the argument here has nothing to do with fundamentals. Like forget this thing doesn't need to work. people don't care.

When you go and you look at the Discord channels or like the subredits, people just like are just, they're all engaged in a pump and dump. They all know it. That's what Wall Street bets is. They're not interested in the cash flow of the company. That's why they bids hurts its stock valuation up a thousand percent after it went bankrupt. You know, like so I just want to just say that because that's, I think, the most profound realization after looking at ample worth. Not Apple, ample forth, none of this. none of this really matters.

The white papers don't matter. What matters is like, what do you think is going on with the momentum and the memes? Because that's all that matters. That's how you can make money. If you're an expert at that, you can make money in crypto today. So, but don't try that, kids. This is not financial advice, just to be clear. And your question was, do I am I optimistic about stuff?

I think there are many places that I've been and likely continue to be optimistic. I think I sound so pessimistic. in part because I'm doing all these episodes recently on geopolitics. And also I'm pretty tired. So that probably I've had a lot of work on my plate the last few weeks and months with a new project I've taken on. So like that could probably, you know, impact my disposition. But like one area where I've been optimistic, very optimistic actually, has been with what Shoshana Zuboff calls surveillance capitalism. And I've been optimistic for a while about free societies pushing back against the sort of techno-utopian, techno-babel, futurist, you know, what's that expression?

Ride or Die crew, like the sort of want to live forever, Silicon Valley, rich, libertarian, liberal, whatever, like the sort of ruling class. I because I think that people really are awake and aware to just how destructive social media has been. And so I'm optimistic about solutions there. I think whether it's stuff that we covered in my episode with Kaling Uport on digital minimalism of people actually trying to hack these platforms or hack the cameras or whatever to just large scale interventions, I think this is one of those bipartisan issues that both Republicans and Democrats agree on. And eventually I do think that these companies will be regulated. To the extent that they're regulated effectively remains to be seen. I think that ultimately will have to do with that really comes down to leadership. Like public education can only go so far.

I think we haven't seen the kind of education in Congress and the Senate that you'd need to see for these people to be able to draft meaningfully intelligent regulations. But in my view, I think these companies should and hopefully will be regulated like utilities. Because I don't, and I don't think that, I don't think that these companies should be able to operate on an ad model. This is something I talked about with Sinaner Raw. And I said to him, you know, do you think that we should ban the ad model? He's like, I don't think you should ban any business model. But in this particular case, I don't think that Google or Facebook should be running an ad model. I don't think it should be getting paid for clicks.

I think that just, that doesn't work and they should just be banned from doing it. So I think that's one area where I'm optimistic. I don't have anything else off the top of my head, guys. I'm sorry to disappoint on that. I don't know. I mean, like the civil stride. I'm optimistic on Europe. Like I said, I'm fairly optimistic.

I'm somewhat pessimistic as a Greek citizen about a situation in the Eastern Mediterranean, although maybe a little bit more optimistic based on just how seemingly incompetent and reckless Erdogan. is and maybe he'll get sucked in. Like I said in my episode with Peter Zayhan, the best hope for Greece is that Turkey will get sucked into some confrontation either with Iran or up across the Basphorus or down into Syria and really will stop being so aggressive in the Mediterranean because it would be very concerning if Turkey begins to occupy islands and force in the East Med. So Europe, I'm optimistic about because of the external security factors that could help them

become stronger and more cohesive. So that's another area. So there you go. Yeah, I'm glad you found something. Sure. So guys, it was a lot of fun. I mean, we definitely talked about more things than I expected. Yeah, it was great.

Thanks a lot for coming on. Yeah, cool. It was my pleasure. Thank you for joining us on this week's episode. We release new episodes every week. You can find and subscribe to the show on iTunes Spotify, YouTube, SoundCloud, or wherever you listen to podcasts. And if you have a Google Home or Alexa device, you can tell it to listen to the latest episode of the Epicenter podcast.

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