TFTC: A Bitcoin Podcast - #729: The Generational Liquidity Trap with Jeff Park

Episode Date: March 21, 2026

Marty sits down with Jeff Park to discuss the converging forces of demographic inversion, wealth inequality, and AI disruption that are creating a generational liquidity trap, why traditional assets like housing and equities represent exit liquidity risks for investors, and how Bitcoin serves as the essential hedge against this systemic breakdown. Jeff on X: https://x.com/dgt10011 Jeff’s article: https://x.com/dgt10011/status/2031757205888762205 STACK SATS hat: https://tftcmerch.io/ Our newsletter: https://www.tftc.io/bitcoin-brief/ TFTC Elite (Ad-free & Discord): https://www.tftc.io/#/portal/signup/ Discord: https://discord.gg/VJ2dABShBz Opportunity Cost Extension: https://www.opportunitycost.app/ Shoutout to our sponsors: Bitkey https://bitkey.world/ OPNEXT https://tinyurl.com/tftc2026 Unchained https://unchained.com/tftc/ SLNT https://slnt.com/tftc Salt of the Earth: https://drinksote.com/tftc Join the TFTC Movement: Main YT Channel https://www.youtube.com/c/TFTC21/videos Clips YT Channel https://www.youtube.com/channel/UCUQcW3jxfQfEUS8kqR5pJtQ Website https://tftc.io/ Newsletter tftc.io/bitcoin-brief/ Twitter https://twitter.com/tftc21 Instagram https://www.instagram.com/tftc.io/ Nostr https://primal.net/tftc Follow Marty Bent: Twitter https://twitter.com/martybent Nostr https://primal.net/martybent Newsletter https://tftc.io/martys-bent/ Podcast https://www.tftc.io/tag/podcasts/

you've had a dynamic where money's become freer than free if you talk about a fed just gone nuts all all the central banks going nuts so it's all acting like safe haven i believe that in a world where central bankers are tripping over themselves to devalue their currency bitcoin wins in the world of fiat currencies bitcoin is the victor i mean And that's part of the bull case for Bitcoin. If you're not paying attention, you probably should be. Jeff Park, welcome to the show, sir. Happy to be on the show.

Thanks for having me. Big fan. Thank you. I'm a big fan of yours as well. And like I was telling you before we hit record, I've been reading, rereading and re-sarnical that you posted on X, the generational prisoner's dilemma, three certain truths and the exit liquidity trap. and uh i'm not gonna lie it's a bit unnerving

bit unnerving but we'll uh we'll unpack it but before that for anybody listening who is unaware jeff is the cio at pro cap financial he's previously the head of alpha strategies portfolio management at bitwise asset management uh and just a sound uh macro analyst in the bitcoin space i I think starting before we get into the meat of the conversation, I think you've had a pretty incredible journey from Morgan Stanley to Harvard management, a bit wise and now ProCap. And I think just starting there, talking about your experience, what's the through line in your thinking about capital allocations for all these different environments and how you

ended up at ProCap specifically? Yeah, absolutely. So as you mentioned, I started my career at Morgan Stanley. I was an exotic equity derivatives trader. And I think I naturally fell into it because, one, I'm a big, big fan of numbers. And on the other side, the equity options business, I think, has always been kind of more probabilistically set for those who are practitioners than maybe anything else, especially related to like Delta One trading. So it appealed to me greatly, but it also shapes a lot of like the worldviews that I have in terms of how I think about not just finance and monetary policies and money, but also just all things in life. And it really set kind of the foundation for what would let me think about Bitcoin and crypto outside of the box that at the time, most people were probably not willing to give or underwrite the different tail risks associated with that kind of cataclysmic event.

um but one thing i knew was that it's also very niche like exotic equity derivatives trading is really small there's probably like you know a handful of traders in new york already that we all know each other um and it's it's it's it's kind of one where you learn a lot but you also get to see you know that the world is a lot bigger than just that and so when i went to the harvard endowment, part of it was because I wanted to see what the rest of the investing practice looks like outside of just being a trader in the exotic space. And that really opened my eyes to the entire endowment model. You get to see the public to private spectrum of investable opportunity set. At the time, Harvard was running an internally managed operation as well, kind of like a mini

hedge fund within trading its own balance sheet. And so that's the team that I joined. And I started trading corporate credit there as well as asset-backed credit. And so it kind of allowed me to see the big picture of capital structure. And I think after that, you just get to see the world moves on credit. And of course, equity is interesting and it's topical and people love chatting about stock tips. But really, the whole foundation of our financial world is built on credit. And I think once you see that, you can never unsee it. And it's partially why I think Bitcoin once I discovered it was so appealing because it was probably once in a generation to imagine how to re-underwrite the monetary framework outside of the lens of fractional

reserve banking system by notion of credit. And if you're a practitioner of finance, I think for me, at least, looking outward to see how the world is changing is equally interesting and important as past looking. So that's why I spent 10 years in the hedge fund industry and ultimately joined bit wise, as my full-time professional foray into being a professional crypto ambassador. Yeah. And I think one thing that you popularize is radical portfolio theory, that framework. It seems like it's gaining traction and I think understanding, getting an understanding of how you came to recognize that maybe the traditional 60-40 portfolio construction isn't applicable to our modern times, to your points, looking backwards.

maybe the the wrong thing to do at a time when we're we're at an inflection point with incredible change indeed indeed and yeah i think inherently i'm uh i'm a i'm a slightly skeptical person when it comes to the importance of asking why and a lot of things were taught in economics 101 we take it for face value for what they say is you know theory and practice but i think if you really just kind of start challenging some of the underlying assumptions around all of the things that we learn in school and beyond, you do get to see that the world is a lot more dynamic and it's not a closed system the way models tend to tell you that things are pretty deterministic.

And, you know, I think a lot of Bitcoiners are at some level, especially those who are early adopters, had that keen trait to be able to challenge outside the paradigm of what you're being told is, is, and that hasn't, that doesn't have to be the way things are either. And we're living through a tremendous time. I think you're right that when I started talking about the radical portfolio theory, it was a little bit more kind of niche, even though I think people had intuition for it. And by no means was I the first person to ever say 60-40 is broken.

But now I do feel like it is more common to run across the average person and ask them, hey, do you think the world is working as it should in terms of asset allocation between equities and bond? And I think most people now would say something's weird. and there's a lot of components as to why that we're seeing of course through the lens of geopolitics but also labor displacement and maybe on the topics of ai but the reality is the world is ever changing and we all have to adopt a dynamic mindset to be able to think about the future to protect ourselves and prepare for it yeah i think this is a perfect segue into your

piece because it really touches on a lot of the topics that would drive an individual to begin thinking seriously okay where where do i invest during this fourth turning this inflection point and like i said before we hit record i was rereading um the piece that you dropped last week right before you hopped on and it is a bit unnerving uh and uh it's funny i i've been saying this on the show in the context of ai for the last six months it's uh i've been playing with it and integrating it into what we're doing here at TFTC and what we're doing at 1031, I describe it as equally unnerving and exhilarating. And it was funny because somebody re-shared the interview that David Bowie did in the early 2000s in some British interview show,

and he was talking about the internet. And he described the internet at the time as exhilarating and unnerving or scary. And I just thought that was funny. Like, oh, we're seeing this play again in fractals of the internet when content distribution and e-commerce was being disrupted in the early 2000s. Forward thinkers like David Bowie were thinking that way. And now with AI, that sort of feeling is reemerging in earnest and probably in order of magnitude uh more intense than it was 20 30 years ago and uh not only that but we have this convergence of multiple themes not only the technological innovation that ai is bringing with it but you in your piece you talk about three um core aspects that we're running into right now

which is the fact that we have this um sort of demographic inversion that's that's hitting the markets we're going to have this massive transfer of wealth and potentially wealth tax taxes and then at the same time uh we have this disruption via this technological progression that's going to affect labor markets and you have this triple whammy of of themes colliding with each other that it's um going to make it hard to to really grasp what's going on yeah at the same time i provided that framework because it brings a certain amount of comfort to me, at least, to have some knowable truths and certainties in a time of such great uncertainty. So the inspiration, actually, for that article was Citrini's 2020 Global Intelligence Crisis

article that he wrote. And I think James is a great thinker, and it was very compelling. But it also makes a lot of assumptions about things that people were curious as to. how to think about those outcomes in the spectrum of probabilities. And everyone is freaking out because there is a lot of unknown uncertainties. And so I think what sometimes helps bring peace at those moments is exactly turn the script around and actually ask, what do you know for certain? And then take those first principles to build a case bottoms up. And that's kind of why I started with that mindset. And, you know, we don't know what's going to happen in the future. Of course,

There's lots of different ways path dependencies will play out. But one thing that can help you in at least gauging what is likely or not likely is to know what are inevitably to be true. And the three things that you mentioned, demographics challenges, the growing gap in income distribution, and then the third, the change in the cost of labor versus the cost of capital that AI is bringing forth. To me, those three things are as good as gold. There is no debate to be had in many of those dimensions. These things are, by and large, going to be factually true. And that's the kind of spatial way I think about it. If you think the x-axis is the income inequality, the y-axis is the generational inverted population pyramid, and the z-axis is the cost of capital question.

And when you think about all three of these things converging into a moment, there is going to be a big, big inflection point. And when that inflection point comes, because of those three things, what is it that's going to basically help you be orthogonal to those risk factors? And that's essentially kind of the attempt of the analysis here. Yeah, so let's start with the demographics and the distribution of wealth among the different demos that exist. It's right on some boomers own anywhere from 60 to trillion dollars in equities and real estate. And obviously, as we know, it's been a growing theme over the last decade. You have baby boomers retiring and basically saying, hey, I've done my job here in the workforce. I'm going to go enjoy the later years of my life.

And that's going to create this need for exit liquidity. And just as they're going to retire, you have this situation emerging where the younger generationals, particularly younger millennials in Gen Z, are finding it hard not only to find work, but even if they do work, that pays well. And so you say that there's this epic housing deflation that many people are talking about. And again, that's one thing I really appreciate about your piece. And I think you described it pretty well, but you were very blunt with people like these are certainties. And I think there are many people who say, oh, well, maybe if we do thinker with things here and there, like we'll be able to thread the needle and get out of it. But just look at the numbers. It does seem like a certainty, particularly how you lay it out.

And so with that said, it's a bold statement. And when most people look at real estate, particularly over the last 50 years, as this ultimate store value asset, this piggy bank for the baby boomers, many will question that and say, I don't know. It's worked for the last 50 years. Why won't that work? Right. Moving forward. Right. No, that's right.

And one of the fundamental tenets, you'll often hear people trying to explain why it can change in the past. We navigated it this way. so we'll navigate it that way again in the future, is because the thing that has helped solve the problem has always been about duration. So the only way the financial system has worked as well as it has is because we kept extending the duration of the forward pull from the future to the present. And at some point, you can't do that forever. You can't overspend, we already now, but you also can't overborrow against a young population, especially if that population is declining. And I think that's the punchline. If you keep kind of assuming the past will be

the same as the future, because we've seen liquidity manipulation and duration manipulation be successful, it was only successful because there was a population that can bear it. But what I'm trying to convey here is that there is no population left to bear it. And so that is the fact that's going to be different in this moment. Take, for example, home prices. Home prices, the reason it's able to participate in price growth really has a lot to do with the mortgage market. If you can keep borrowing forever and justify that present value at nominal levels that extends your duration, you can do anything. So when Trump jokes about there being a 50-year mortgage or like a 75-year mortgage is the same extension of how do you just keep bootstrapping

the present value to the future that you don't have to deal with, but lower the current burden, the current interest rate burden today. But the terminal value can notionally still increase in value. So that's why there's so much of these types of things happening in our financial system today where people underestimate how much manipulation is happening across that duration curve. Another one I'll throw here, and it wasn't written in the article because this is very topical, it's actually related to the latest news you may have seen about NASDAQ changing its rules to allow SpaceX to be potentially a member of the index once SpaceX goes public. This is the kind of thing that is happening in the stock market right now that is in some ways unfathomable to

kind of why the public market and the private market has always existed the way it has existed in the past. And you get to see really clearly that if you just think stock picking is like, oh, here's Albert. He's buying this stock and selling this stock because he thinks one is overvalued and one is undervalued. And that is price discovery and efficient market hypothesis. We have moved so far from that world where there's things like indexing. There are things like interval funds. There are things that blur private capital and public capital and weird vehicles that shouldn't exist and all of this like paints this continuum of risk transfer that is happening ultimately because the demographic challenge it has to be dumped somewhere somehow

and it's either going from private market to public market it's going from generationally top down or it's happening from other kinds of offshore investors to onshore investors but like The scheme is how do you get more money into the United States to help asset continue to inflate so it can afford the cost of carry that it's promised all its generational investors. Sup freaks? Up next, the Bitcoin Scaling Conference where Bitcoin developers meet institutional capital is coming to New York next month. Join Bitcoiners from Blockstream, Chaincode, Brink, and more at the Can't Miss Summit at

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I'll see you there. So, freaks, this rip of TFTC was brought to you by our good friends at BitKey. BitKey makes Bitcoin easy to use and hard to lose. It is a hardware wallet that natively embeds into a two or three multi-sig. You have one key on the hardware wallet, one key on your mobile device and Block stores a key in the cloud for you. This is an incredible hardware device for your friends and family, or maybe yourself who have Bitcoin on exchanges and have for a long time, but haven't taken a step to self-custody because they're worried about the complications of setting up a private public key pair,

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uh it seems like we're at this precipice for real estate in the united states where push is going to have to come to shove at some point another i think bar chart reported this morning that the average 30-year mortgage rate right now 6.85 it's creeping up a bit and then if you look at the 10 and 30-year treasury yields they're they're remaining elevated and so if you look at housing there's two parts of the equation you have the interest rate on the mortgage and the cost of the house and it looks like since beginning the interest rates are pushing up and So, yeah, it seems to me that the cost of the housing is going to have to come down significantly to sort of level out with that that equation. Yeah, no, that's right. I mean, I think every metric shows you that labor inflation has not kept up with asset inflation, especially post-COVID.

And you get to see that the general expenditure the young population is putting to rent and housing is far superiorly larger than it should be from previous generations. Meaning these younger generations can't actually accumulate wealth, right? They can't actually accumulate wealth that would otherwise go back into the stock market. And so when you see these Trump accounts being set up so that children have to start locking away money into index funds until they're 18, by the way, the Trump accounts force you into equity index funds. You can't buy stocks. You can't buy single names.

You can't buy bonds. You can't do anything but equity indices. It is a mechanism. It is a conduit to kind of permit liquidity that otherwise is captive now that has 18 years of duration, right? Because you can't actually withdraw without penalty. Housing in particular, I think in the U.S. most acutely, but everywhere in the democratic world is an interesting asset class because there is the consumption of housing, but there's also the investment case for housing. The consumption of housing is if you're in family formation mode, you buy a house because generally it comes with different social services and benefits that are important as part of growing in your community. Schooling, of course, is the big expenditure from property taxes.

And yet, like people also buy homes because they expect house price appreciation as an investment class, regardless of whether schooling is part of their underwrite or not. And if you really squint hard enough, you'll see there's something pretty circular here, which is if education is rising constantly in cost, and it seems to be rising a lot because the administrator ratio to the student ratio has gotten pretty extreme over the last 20 years, what that's saying is that there are kids now basically overpaying for their education because of the burden of administrators relative to the actual cost of education that then is also letting them go to debt. So a lot of these private universities, the biggest challenge and complaint has always been they're way too expensive. And they're expensive because the

administrators are 10 times the growth rate of student and faculty rates. And so the subsidy that otherwise should be coming to students are actually subsidizing these administrators. So if housing price is being indexed to the cost of education, which it tends to be because property tax, the biggest step spending will be education. You actually see that this is a multifaceted problem, still, again, very demographically challenging for the young, because in that a world where you can't actually afford housing, there's no like easy way to guarantee education in a solid way. And then you see how it becomes like a pretty circular problem. And I think it's just pretty evident at this point, like, if homes are owned by like people

that are like 50, 60 years old plus, which is what like the median homebuyers stats will tell you now in this country, like the median homebuyer is like over 50 years old, meaning they're probably second homes and things like that. It's just going to change the calculus from consumption housing as a need for a growing population versus like the investment case. And those two things, the fundamental tension is the value assignment is different. One needs to be consumed today. the other one has some kind of infinite duration into whatever it is that they think is going to happen to housing prices based on other kinds of manipulations like long-term interest rate and 100-year mortgage and whatever else that they can concoct in the future

no i think i think the uh the connection between university cost and and housing is an astute one because i actually wrote i studied econ in college this is back in like 2012 2013 because i was in the I was in the thick of it I think my generation particularly we graduated high school in 2009 right after the financial crisis and I remember just being like how can they give out all this money and and I wrote uh basically a long paper on it and the messed up part is it's trickling down to uh from the university like the cost of university is trickling like this is the trickle down economics as the university and get the student loans, the government will issue them so they know, hey, we can bloat our administrative layer. We can increase our prices because the

government's going to give these kids the money anyway. And then maybe not necessarily public school, but the public schools are probably doing something similar to the private schools. But the private school, I went to a private school in the Philadelphia area. And when I was a freshman in high school i think was eight thousand five hundred dollars a year now it's like twenty five thousand and because the the schools are able to like the the high schools the private high schools specifically and i imagine the public schools to a certain extent are saying well if you graduate from here we're going to be able to get you into these universities and these universities their four-year degrees are worth two hundred fifty

thousand dollars and so paying a little bit more um to get the education necessary to get to uh the the the high-priced university ticket is is worth it so you have these compounding um sort of factors that are there this is like really how trickle-down economics works in uh in a fiat monetary system and it's completely corrosive to the ability for people to actually save and build wealth in the long term yeah no i agree i think yeah besides housing i think the greatest generational theft that has ever happened at a global level this is not just about the u.s is student debt. You have basically taken a lot of kids to put on student debt, especially if you've went to private universities, because your debt funded administrators' cost of living,

right? Again, this is like a funnel trap of money flowing in a direction where the young is being repressed at the benefit of the older cohort. And your education was not worth that much more because you are paying these administrators beyond what the basic tenets of education really should be. And so if you basically start your career with incredible leverage to which their market price for your labor is not commensurate to kind of whatever artificial price was put on you, then you start off with handcuffs. I mean, forget housing, like you have other things that is kind of holding you back as is. And so there's an inability to just reach levels of maturity

that prior generations, I think, were able to find success in because this liquidity trap, again, is so profound. And that's why I think a lot of times now you see pushbacks on that education model too, where people are more willingly able to talk about trade schools, vocational schools, or actually just going straight to companies

like Palantir if they're hiring talented software engineers right out of high school and google too like i think you're seeing more movement towards that because i've it it ascribes the value of human capital maybe a little bit more in line with market rates than what this artificial rate of college education has been which has far exceeded inflation um and beyond in the in the past three decades yeah and on top of that uh the internet has provided the ability to give yourself a college education if you have the will and the agency to teach yourself um shifting gears a little bit but staying on this sort of inversion demographic inversion and credit uh you've described private credit which has exploded

to two trillion dollars uh estimates say as a time bomb in pensions and endowments and i think over the last two weeks uh the market is becoming aware i think people began signaling the alarm Bell's middle of last year hit his private credit thing. If you do the math and you look at when a lot of these funds raised in 20, 21, 22, the valuations that they got into and where rates were then and where rates are now, going back to duration, a lot of these private credit funds are issuing on five to seven year duration and a bunch of refi waves are hitting the market. And then on top of that, I think it's becoming evident to many who are paying attention that a lot of these private equity and private credit funds were on the search for yield and were

doing things that many would, myself included, define as rather risky. I think one of the practices that Steve Eisman had a forensic accountant on last week or the week before, and he highlighted that a lot of these private equity funds are buying insurers and reinsurers and taking the premiums that they're reaping from those insurance companies and pushing them into these private credit deals. And as you point out, a lot of pensions and endowments have exposure to this. And sticking on the demographic time bomb that we have, we could find ourselves in a situation where a lot of these boomers are going to retire and some of these private credit funds took some of their retirement annuities and pushed them into

some, some risky private credit deals that could potentially be blowing up right now. Yeah. Yeah. It's a big shame. The big shame here is ultimately an agency issue, which is that the administrators of these investment programs are not necessarily the principal risk takers of their own value creation. So, you know, as I've had now a long career in finance and in asset management, the big difference between institutional investors and you and me and family offices is that you and me and family offices invest for principal risk. It's our money. Like we care about how our money is invested because we actually wear the wins and losses of that decision. But it's not true when you're an institutional investor and managing a pension

on someone else's behalf, or you're an endowment CIO managing it on someone else's behalf or a And so the kind of construct of the managerial institutional investors is one worth deeply understanding because there is conflicts and room for ambiguity as to what kind of moral hazards could exist. The perfect one within private credit is, of course, there's liquidity transformation that is happening, like we talked about, but there's one additional factor. it is price discovery that is being manipulated as well. And when you mute price discovery, as the administrator, there's a lot of benefits. You don't have to be responsible. You don't actually have to be responsible if something isn't marked down the way publicly traded instruments are, if you can wait for seven years to find out. And maybe you won't even be at that job in seven years from now, and you'll stuff it to someone else who comes next to administer the pension.

um but but that is largely what i think is different about the private credit shadow banking system versus even when banks uh pre-2008 were involved in a lot of these lending activities you know you have to remember the reason the private credit industry grew was because post 2008 there was a lot of noise to prevent banks from engaging in these types of lending activities because they decided that these kinds of lending activities create risk. And at some level, it's better to kind of put it off the balance sheet of our strategically important banks and let other alternative asset managers come and wear those risks. But here, you have to recognize the incentive alignment now is fundamentally different.

If you're like a bank and you have customer deposits that you care about, your customers to which then you're lending funds out that you know you want to protect, well, that's still one degree closer to the customer than it is to like an asset manager that is collecting a fee every year on whatever loans that they're originating, whatever crystallizations they're experiencing as a portfolio manager versus the institutional investors who literally don't have that much skin in the game otherwise, besides just allocating capital that they've been mandated to. So this incentive structure is really, I think, important to understand because I think the

biggest criticism i would share is that post 2008 um it's gotten worse and it's gotten worse because private credit has become this two trillion dollar asset class not because it's like better than public credit uh it's because there's other things at work which is which is moral hazard um at its at its worst so the thing about private credit ultimately is um there's good private credit and there's bad private credit. So what I mean by that, there are certain kinds of bilateral credit origination that has to happen on a negotiated basis because the underlying risk can be extremely exotic or esoteric. One example of that is litigation financing. If I'm going to back a lawsuit on the merits of claims and I have to analyze those claims, then I actually have to

recognize that's not going to be fungible to funding another lawsuit. Each lawsuit stands on its own ground. And as a credit investor to fund a litigation, you're underwriting that particular idiosyncratic risk. And you know, you need duration in that underwrite because lawsuits take a long time. You also know that it's uncorrelated returns because lawsuits have merits that will depend upon not where the S&P 500 is. Like it's not a corporate credit that moves on what Jerome Powell decides rates should be. It's suing for claims and damages in ways there's going to be case law so that's good because that's credit like solving a function someone needs to sue they don't have the money someone funds it and you know someone's willing

to underwrite that risk that kind of private credit i think is useful the kinds of private credit on the other side that's not useful is basically sponsors wanting to do off-market deals at size away from the scrutiny of the public arena and doing things where these incentives are being mismanaged. And therefore, you create adverse outcomes for everybody. And the big thing that private credit funds will tell you is like, we get better deals because we negotiate one-on-one. And so they're off-market deals. Well, guess what else happens when it's off-market deals? Maybe you don't get the best price because it was never put in comp and it was never put in a bidding war. Sometimes maybe the best outcome is actually if it's in a price discovery mode

where many investors can participate. And so that's kind of the spectrum of private credit that exists. And I just wanted to make that point because private credits become this like catch-all phrase for everything that is a liquid and long duration. But it's not always the case that private credit comes in lots of different forms.

And there are some good private credit where it is useful to have. The problem I think is that the things we're talking about here is not that version of it. what's up freaks when you take bitcoin seriously you start with custody you want to control your keys avoid single points of failure and make sure your savings cannot disappear because you or someone else screwed up that is what unchained has been focused on since 2016 unchained is the

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It has free shipping as well. So go check it out. Do you think this is the private credit complex and the stress that it seems to be under is equivalent to the 2008 like real estate collapse? Well, in real estate, at least the idea was like you had collateral as like senior secured loan to underwrite value to, right? The problem is the home price is wrong, but you are first in line as a mortgage originator and mortgage buyer. In private credit, even though sometimes it is loans, it doesn't mean you have the security collateral or the covenants to be able to enforce that outcome. So that's the biggest difference. In asset-backed lending, you generally have the collateral. When you're dealing with corporates, it depends what your

security lien itself is. Sometimes it is actually backed by hard assets like property, plant and equipment. And sometimes it's actually just a personal guarantee from the CEO. And so there's a big spread of outcome that could happen. But the other kind of adverse situation is this. You mentioned this. Private equity and private credit tends to work together. And if you think about it, they're on opposite sides of the coin, right? Because whatever is not going to the private equity is going to the private credit vice versa so it should be like an adversarial relationship but it's sometimes not because these all these firms all kind of know each other and they're able to kind of engage in practices where you might think that there's like bigger

incentive alignments at play as to how they're managing each other's relationships um and it's not to say like everyone's a bad player but but if you like show me the incentives and i'll show you the outcomes. You can imagine that these things can be abused. And so that's why you see stories where private credit, some of these just go to zero. I mean, you have to wonder, how could something go to zero? If you're a loan and you're first in the capital stack, there should be some recovery value. Even publicly traded bank loans, their recovery value is around $0.30 on average. So how does it go to zero? How could there possibly be nothing to recover from? And then the question is like, you know, what, what happened to the equity? Um, and, and I think

there's going to be a lot of these stories that are going to come out where you're going to see sloppy underwriting. Um, but the underwriting isn't like misvalued home prices. It's literally like, what were you doing? Kind of errors that you were going to start seeing, which I think is actually just worse. Um, and it really just loses, makes you lose faith in, in kind of the banking system in the ways that maybe there were trade-offs that policymakers made when they decided banks should not be in the in the in the corporate lending business and you have other you know asset managers in the game yeah and i think uh the black i mean maybe not a black swan but i think would have been unforeseen to a lot of the private credit funds private equity funds

underwriting some of these deals in 21 and 22, which is, I think a lot of it went into like B2B SaaS software products and now AI is here. That's like, oh. So when I was at my prior hedge fund before joining Bitwise, private credit was a big business of ours. And you really would get to see a full spectrum of underwriting standards. So sometimes like to these SaaS companies, you would look at kind of the ARR and think about kind of that value and think that is credit like that that is underwritable collateral because these are like long-term contracts and you think like sas contracts are long their maus are good they're like churn is low so this is like good collateral and you'll underwrite

it well guess what happens when something like ai comes along and then these things might turn upside down like it's not collateral the way like physical like home prices can exist and so So, you know, IP is another one. I've seen lots of loans done on the back of like, this IP is worth X amount. So the IP value alone is good to cover your first loss. And it's like, well, maybe, maybe not. Like, who knows what IP is worth? Like, depends on who the buyer is, right?

And so you would get to see like a lot of different outcomes here. But the one thing I will say, too, is this. When I was pitching Bitcoin to institutional investors at Bitwise, you would hear a lot about people who would be concerned about Bitcoin's volatility or kind of the lack of ability to control for price outcomes because it's exogenous to your own control. and these things would give CIOs a lot of fear and uncertainty to consider Bitcoin as a legitimate asset case. Almost always, these investors loved private credit. There was almost a perfect one-to-one correlation. If you hated Bitcoin, you loved private credit. Because guess what? They're exactly on opposite end of the spectrum. One is not about price discovery. The whole point of private credit is to avoid it. And of course, there's a coupon that makes you feel like you're getting some kind of gains out of it. But it's really your classic case of that turkey who's

happily living until Thanksgiving, and then the happiness goes to a cliff. And so that's why I think I enthused the mission of Bitcoin even more in that construct. I was like, what is this liquidity gap that is going to unfold in private credit? And what could people choose as an alternative? And if you take it to the extreme, the alternative you want is immediate price discovery lots of volume uh that is kind of public and discoverable and one that is like a hard commodity that actually isn't backed by ips and other things that people tell you are worth anything but actually the collateral itself um so i see kind of bitcoin on the receiving end of the of the of that meta if it were to change like we need to kind of go find a complementary asset class

that pairs nicely with that duration mismatch yeah i think um yeah the the credit complex needs to be refinanced it needs better collateral in the form of bitcoin thanks i think that has become abundantly clear to me in the last last five years but moving along i mean going through your thesis of uh you know these free converging themes i mean second is the inevitability of the wealth tax um and with the top one percent uh approaching one third of u.s wealth they hold one third of u.s wealth almost you have um headlines uh out of new york city and the netherlands of insane taxes netherlands pass the 36 percent tax on unrealized gains uh and then new york obviously if you're in the united states following what the um

mom donnie uh administration is doing there in terms of the the wealth taxes that they're portraying that they want to get passed particularly on on people who own assets over a certain level it seems like as these this wealth inequality and this wealth transfer begins to materialize that the governments are going to sort of force it if if participants don't do it willingly. And that's going to come in the form of wealth taxes. That's right. That's right. I think you asked 10 years ago whether wealth tax was coming to the U.S. and everyone would have laughed you out of the room. But now I think it's, to me at least, fairly inevitable that some construct will be placed. And it's because that social contract has been broken.

um we also should make a distinction between income inequality and wealth inequality because they're slightly different income inequality i think is a problem but it is still based on the construct of productive contribution to earn an income that should otherwise translate into some value creation right that's that's hopefully the people can make that assumption if you deserve an income it's because you're doing something for it wealth is different because if you're just sitting on it and it's passive and it just consumes otherwise money that should be in circulation for an economy to function it's actually a net negative if that thing is uh is becoming like a tax in itself because that's not capital that is otherwise like productive

beyond just kind of existing in some format um as a financial investor and the challenge is um when it comes to capital gains you can only charge capital gains when it's sold right and you can also sit on a bunch of unrealized gains and not sell and still do things with that cash like that capital i mean you can take a lot take out loans against it or whatever meaning like you don't have to actually ever pay taxes on those gains that are sitting in your balance sheet So one thing that these unrealized capital gains tax solutions are trying to solve, and I don't agree with generally the soundness of what they're doing, because it creates a lot of weird, bad incentives. And if you roll it out in a way that is like dysfunctional and not coordinated, it creates more issues and solving issues like wealth will flee to different places and you can't actually contain anything. but but the but the fundamental problem that they're trying to solve is a legitimate one which

is if you don't pay taxes on these things because you're not selling it then how can that money come back into the system and by the way you're not selling it which is why the price keeps going up and the young people have to keep buying it at higher prices right it's actually the same problem It's the same generational wealth movement problem, which is you have to sell it for it to move to the next generation or to another buyer. And so the wealth tax is basically saying you need to sell. Like in a perfect world where there is an unrealized wealth tax that you can't escape from, like you can't just leave California and go to like Texas and not pay. If it was actually a holistic strategy and you couldn't even leave the United States and, you know, you're captive to it as a U.S. citizen, it would create forced selling. And that forced selling would be great for those who want to come into the market, i.e. younger generations who haven't generated enough asset and wealth accumulation.

And it would essentially kind of help price discovery at a point where that flow model isn't being distorted by the fact that there are no sellers. um so so even though it's kind of horrible the the goal i think is is right which is like how do you bring some you know velocity to this asset wealth that is otherwise like dormant and isn't coming back to market at a price that is like you know discoverable for new investors um and this is not like a black and white answer and i don't mean to exaggerate like this is this is this is the way to do it but i think that's the underlying tension that everyone is trying to solve um for for um what otherwise is becoming a breaking point yeah no i mean i i think to your point and you highlighted this in the article if you look at um if you look at polling out there

seems to be um widespread support for some sort of wealth tax which is scary and then you have obviously elon musk and others in the ai space talking about universal high income and they're looking at what they're building and looking out at the world and the disruption that may be ahead and saying we're going to need to solve this problem by getting money into people's hands but i think um yeah the i think this makes the case for bitcoin right i mean going back to real estate it's like you shouldn't be using the consumable good as a piggy bank like you should take the excess monetary premium that exists in these assets put it into bitcoin and then let those assets find the correct price which is probably lower than where it is now so that people can

get into them and then when it comes to productive assets and capital goods similarly if people are using those store value assets so just funnel that to bitcoin let those things price accordingly so that people can scoop them up and put them to work yeah yeah no that's right and um i also hear this punchline that wealth taxes are un-American or it is non-capitalistic and socialist and whatever. And even though that is probably true from an ideological perspective, the reason it's becoming popular is because, again, the social contract has been broken. And if the social contract of capitalism breaks, these are the things that ultimately emerge. And I think for capitalism to generally work as well as we hope for, we need more sufficient price discovery

for which people can transact. If you really think about the purest definition of capitalism, it's open markets. We need open markets for price discovery and people to act accordingly with information that is symmetrical on both sides as retailers and institutional. And what we're seeing right now is that, you know, we call it American capitalism, But there are so many little features about it that doesn't look like it's an open market. You know, I go back to the SpaceX thing where like in the past, like companies had to IPO. This is before the Facebook days when you had more than 100 investors. This is actually a rule.

Like if you had more than 100 investors, you have to IPO. And I think that's because, hey, if you found enough like capital to grow at some point, like you just graduate and you become responsible for public shareholders, both from an access perspective to invest in growth, but also like an accountability, like you have higher disclosure rules you have to follow as a real company. Facebook changed this when they didn't go public in that timeframe by arguing for different exemptions to it. And they succeeded, which is why we've ever since then had giant, giant, like multi-billion dollar companies that can stay private for a very long time, which I think has always been like slightly insidious, but now we're

seeing like really weird stuff come out of it so for example if elon musk is able to take spacex public at 1.5 trillion dollars that number is like not an insignificant part of the us gdp right i mean like a huge number that is all of a sudden trying to access the public market and if you look at the float that they're going to be able to go to market with relative to like what the nasdaq index can digest as part of being included in there like shortly thereafter bypassing like the rules around how you have to wait in season for it you're basically forcing a bunch of index investors to buy spacex indiscriminately to get yes to provide liquidity for those investors like you tell me if that is a capitalistic open market endeavor like in the deepest of hearts

Is that construct capitalism or is there something strange going on where like the financialization, the hyper financialization of our capital markets has gotten to a point where it just doesn't smell correct? And I think all of us who kind of look at this and say, hmm, it smells a little funky are right to have that suspicion. It is a little funky. And that's why, you know, go back to the principle of being a radical thinker. Like you have to understand the problem to diagnose the solution. And we're just seeing so many more of these types of things coming online, which is why people are even going crazy on the other side, asking for something as bad as a wealth tax. Wealth taxes are horrible. I will never, I think, defend it as long as we feel like that is going to create problems in ways that has perverse incentives.

But the other thing is horrible, too. Like the idea of SpaceX IPO at 1.5 trillion with a forced bid into the Nasdaq index across the entire passive flows industry is also really weird. And you could have both of those two truths in your mind and be able to rationalize those two to be painting a picture without being contradictory of having to choose one or the other. They're both not great. yeah that's funny too i mean spacex obviously nilam must company and then you look at what tesla was able to do for a bunch of retail investors by going public when it did and there's a ton of people that i know that aped in the tesla yeah and 15 years ago and they're feeling very good yeah they're doing so and uh it's just funny that dichotomy between spacex and tesla tesla went public relatively early and many people have benefited from that and now spacex going public 1.5 trillion is like how high can it go can be truly be a three four or five trillion dollar company maybe the space thesis plays out but there's a lot of risk yeah i mean i think you

have to really underwrite like if our capitalism can create a private company that is worth 1.5 trillion dollars outside of public scrutiny like that should really be a question we should be asking and go on some deep soul searching yeah i mean and this is a big theme in silicon valley i remember uh the collison brothers were on uh all in the all-in podcast the beginning of the year and they were just flippantly saying like we don't need to go public there's a ton of that's another thing like private markets there's a ton of funds that have come so there's a ton of secondary liquidity that exists that these founders feel like i don't need to go public i don't want to undergo the scrutiny that comes with public markets. And there's a pretty deep

pull here in private markets. And this is the shame, right? Because they're absolutely right. They don't need to go public. But they also have to understand in the construct as business owners and operators is that all of this is based on this social contract of fairness. And it's not about what you need to do as much as the moral authority of what you should want to do. And I think that is ultimately why the chasm is here. We are not asking the tough questions of what is the morally right thing to do in the name of capitalism to be able to conduct business in ways that everybody can participate or benefit or feel like they're part of that movement and not feeling like they're opted out. And I think based on the New York Times survey, it's very

clear most people feel like they're not participating in capitalism um that's why more than 50 percent across every cohort demographic and race except for white college educated men which by the way is also thinly over 50 the rest of them are already gone you know they're all for the wealth tax um yeah and we should find this to be a problem that's funny i think uh i think it's very prescient that you brought up the uh the moral argument because i I think that was one of the 24-7 news cycle headlines of the day yesterday was Mark Andreessen saying that, yeah, he's not really introspective. He's just like, go, go, go.

Don't think about what you're doing and think critically about it. And a lot of the commentary around that was like, wait a second, like all the great men of history have thought about what they're doing deeply. Like, is this having a positive impact on the world? And I thought that was an incredible microcosm of one of the things that one of the mindsets that leaks out of Silicon Valley is undeniable. All the technology and the progress that has been made from that part of the world is undeniable. However, there is, to your point, this like moral and societal argument that seems to be pushed to the wayside at times. Indeed. Have you had a chance to read Alex Karp's book, The Technological Republic?

No, I have not. I think you'd love it. You would find it really enjoyable based on the comments you just shared with me, which is that Alex makes the case for the decay of moral authority in Silicon Valley being the root cause of a lot of the problems. He, of course, has his own bag, which is, you know, the military complex. And so you'll get a glimpse of that, too. But generally, I think what he's saying is that Silicon Valley being kind of consumer facing entrepreneurs post the breakdown of the public private partnership of like the NASA days and the DARPA days don't fundamentally ask questions about like, what should we do in the good for people like good for the country? even. He'll go that far, kind of this patriotic angle of why you should do anything that you do for the benefit of your country and others, especially as a business executive. And he'll

kind of cite the rise of the search industry being at the center of why the moral decay has happened, because he'll argue that the search business is basically only successful if it is able to mute any idiosyncratic view, because it must have appeal to the widest eyeballs as much as possible. So if you're in the Google business or the Facebook business where you're maximizing for search revenue, you can't alienate everyone. But in the process of not alienating everyone, you actually stand up for nobody. And therefore, you lose kind of the center of gravity as to like, what do you represent? What are your values? What do you care about? And a lot of entrepreneurs have been raised now with that construct where they don't think about it because of that kind of cultural ideology. um and so you know there are things to like about what he says there are things you should dismiss about what he says but broadly what you're seeing about this like moral imperative question not being present in silicon valley um historically has been a problem i think we're making a comeback i think nowadays you're seeing more of that kind of class of entrepreneurs talking about it more openly

um maybe it's because the world is becoming more adversarial and there's geopolitics and all these things but in the end like all companies have a home and it's their nation state that they're a part of for which the constituents are its civilians and you need to kind of support that full circle uh as a company to operate yeah i mean this is uh i mean a perfect topic to dovetail into the sort of third pillar of the article that you released last week which is this ai and the emergence of AI and proliferation of it, redefining capital. And you highlight that the labor share of GDP fell from 65 to 55 percent since 1980. Goldman's estimating that 300 million jobs are exposed to automation and data and intent are becoming the new capital.

And we are transitioning into this era where the cost of labor is being compressed towards zero. And we need to figure out how to allocate money as that happens. Yeah. This is the topic du jour. I think everyone is thinking about it. There's a lot of anxiety and optimism on both sides, though. I think, oddly enough, maybe one of the most anxiety-inducing technology for otherwise Americans that tend to love all technology process and progress, which begets the question, why are people so anxious about it? And I think they're anxious about it because instinctively they are concerned about the right things, which is that they see that their own labor value changing very quickly in the ways that these LLMs have some reasonable ability to reason.

um without going into like the fullness of what it means to have agi versus kind of where we are today the reality is we've seen productivity gains with the current tooling as it is which is why it's become kind of like a wake-up call you also hear about a lot of um pundits and spokespeople talking about hey you should not be worried because technology has always been the great equalizer and there's always been jobs like you know the cars didn't put the horse you know carriage people out of business like there were more jobs created with cars and and yada yada yeah you'll hear this argument um and i think it's partially right but it's also ignoring the complexion of the underlying effects that ripple through when you reset the economy so you know

no matter how much we think technology has benefited human civilization which it has we have to acknowledge it happened with this divide of the social contract too like they both happened simultaneously so people who have been displaced because of technology um is partially why the rust belt movement was like as big as it was in the abilities for our politics to change so to ignore that like there was no down effects to otherwise like great productivity gains is like misdiagnosing the problem like these things are both true lots of productivity gains happen and a lot of people got put out of the labor force as a result of it like and and we're actually suffering through that now like we already see so many of people that

were displaced already where like they're not participating in the white collar economy that Otherwise, maybe they would have in a different way. So if you acknowledge that to be the trend, then you can easily extrapolate that it's only going to get worse. Like, yes, there will be new jobs, but it keeps narrowing the pool of talent that is able to get those jobs or participate at that level because the bottom is just widening more and more. So I think you have to just acknowledge that both of these two things can be true. And the question then is, what's the fulcrum? Where's that turning point where the imbalance in society is just so large that it is irrecoverably damaged? And I think the reason people are skeptical or worried about AI is because it seems like this is the thing that will put us over that fulcrum. Because exactly what I talked about, it changes the cost of labor in like a really dramatic way that no other technology has. And it also directly competes with the cost of capital because the asset owners of these

toolings and these technologies too disproportionately are able to capture a wider TAM. And so one thing that's always been true with technology is that it is in some ways an equalizer for great access, but it also has become an incredible accelerant for inequality. Technology does not give equal access to everyone at the same rate. Some people benefit exponentially faster than others. And in that world, we have to imagine society just exists on a curve. and the curve question is how does the median and the mean look relative to the range and the mode and does it look fair and even if the peak is higher because technology allows you to achieve higher level of productivity on average if the distribution is like really skewed

it is equally problematic beyond the actual peak and the notional value because society exists in a probabilistic outcome of distribution. And that's the key. We all live in a distribution curve. And AI can change that distribution curve really dramatically. Yeah. No, it is insane.

Like I was saying earlier, we've been implementing it in our processes here at TFTC, and it is astonishing what it has enabled us to do. And we're just a team of five here in what we've been able to do with a team of five with these tools it would probably need a team of 15 or 20 at least so i think it's two to three xing our productivity at the very least probably 10 to 20 x if we're being honest and then just observing this and touching and feeling it for the last two three

years and then sitting back and trying to be introspective and reflecting on uh how it's going to affect everything else in the economy. It is once you sit down and actually think through the order of operations and the second and third order effects, it's undeniable that this is going to be incredibly disruptive. Incredibly. And yeah, the thing is like you're a smart guy. And so you're on the right side of history where you're going to figure it out and you're going to benefit as a result of it in an outsized way, hopefully. Right. But you have to also acknowledge your benefit is going to come at some loss towards the fact that the mode of people will not be able to figure it out as quickly as you can, or there's some kind of change in that distribution of outcomes that

is going to look just remarkably different from what it looks like from the past. And so I think that's the key. Like, you know, it's great for like entrepreneurs, you'll hear how you can now have like, you know, solo companies with AI toolings as an entrepreneur and create incredible productivity tools and wealth for yourself. It's all possible, which is great. We should celebrate that but of course not everyone can do it it just makes it better for the exceptional kind of people and they're just getting to eat a wider tam and and if you accept that most most of society unfortunately for better or worse exists again on a curve where no one not everyone is exceptional you know that's where the problem is going to lie on like like there there there has to be some

kind of ability to let those people who exist at the middle of the curve not just on the outliers but the middle of the curve to be able to feel the benefits of this technology they have to feel it yeah and i wanted to pull this up because i thought these two paragraphs really distill what you're getting at now we can build on it from here but the nash equilibrium will emerge as all players defect as the rational dominant strategy regardless of what someone else does for the price of inaction is too great to bear. So when the moment comes, everyone will rationally seek exit liquidity at the same time. I think this is getting to the crux of the articles. How do you avoid becoming the exit liquidity? This Faustian bargain of liquidity must be understood not as a

mere possibility, not as a tail risk to be modeled and hedged against, but as the single most predictable mass coordination event in the history of human capital markets. Some argue that in a deflationary world you want bonds not only interest-bearing instruments or ai equities riding the exponential curve perhaps but my north star is simpler and more structural you want to own things that will not let you become someone else's exit liquidity in that framework the last thing you want to own in order are housing bonds and u.s equities these are duration manipulation instruments engineered whether intentionally or not as the greatest generational wealth heist in history what you want to own instead should satisfy satisfy the three conditions simultaneously

in reverse um i guess we can get into that i don't have to read everything but i thought those two paragraphs really distilled what's going on here yeah yeah wow when you read it out loud like that it sounds more harsh than i thought i'd written it um and so negative uh though again i think my point was not to necessarily be negative, but to hopefully provide an optimistic version of what one can do to be on the right side of the trade. The reality is that we've talked a lot about this stuff in the context of U.S. politics and us as Americans, but this is a global phenomenon. It's happening pretty much everywhere in the developed markets. It's happening in China, too. You hear lots of labor displacement issues in China, even worse than here, actually,

because their automation is at a level that is probably beyond what we would find acceptable from a social perspective. Things have been bad generally in Asia for a long time with Japan and Korea leading the way with just birth rates. So all of this global trend is going to converge at some point where liquidity is ultimately a function that is self-reinforcing. When everyone wants to sell, they will all sell. And that fear of not wanting to be caught left alone is very real. And once it becomes obvious that there's no bid left, it'll just fall off the cliff. And I think that's why so much of what the US is trying to do is to mitigate that cliff. Like part of the reason I think tokenization in crypto has become so topical is because in the future,

the idea is that it will let offshore investors buy US equities more easily, right? So look, If we can't buy it here because we don't have enough wealthy young kids, why don't we let foreigners buy it? Because foreigners love American stocks. Foreigners want a piece of NVIDIA. Foreigners want a piece of Facebook. They just can't access it, tokenize it. They're going to be the exit liquidity. So like the whole scheme, I think, is like, how do you create a floor?

So the U.S., I think, is on the best possible like situation amongst the rest. like there's a lot of good things to like about the u.s economy and the talent and productivity that we produce uh so if you know you ask me like which cards do i want to hold in my pocket i will always pick the u.s as my ace cards and you know if i'm wrong about this generational liquidity trap it will be because the u.s is successful and is able to somehow emerge out of it with real productivity gains that is like incredible that is like unlike anything we've ever seen before. And broadly shared across the distribution curve. That is shared across the distribution curve. Exactly. But otherwise, the thing that I always have known, and this is something I've

known ever since I was a trader at Morgan Stanley when I was 21, the market just decides that the price is at a point in time for a transaction based on supply and demand. That's it. Price exists as a fixed observation, but it also exists as a wavelength. It is actually something constantly always in motion based on demand and supply. And it is this kind of Schrodinger quality about what does an asset price represent? We think Bitcoin is worth $73,000 because that's what it says. Bitcoin is worth $73,000. No. Bitcoin is at this moment $73,000. But the box in which you open it next time and the outcome can be different is basically Heisenberg uncertainty principle. It exists in a contour of quantity. And in that world, you just do not want to be

left holding the bag. And I think the demographic trends is very hard to ignore. That's just math. Like there's really no kids left. Like there's birth rate that isn't happening. And you're not going to fix that overnight because we're not aliens that generate all of a sudden 18-year-old kids tomorrow. We have visibility to this car crash that is coming. The wealth inequality too, I think is really hard to solve because there just is always like issues with capital flight in the world that like the internet has made everything so easy. And, you know, in some ways, Bitcoin, I think, represents a little bit of that energy, too, which is like for the first time you actually can have wealth that is outside of capital borders, you know, and because of that, like Bitcoin has an extremely valuable trait that I think people continue to misguide. Bitcoin's most valuable trade is the fact that it is actually software that doesn't

have to physically exist and you can own it in a non-custodial way. That's it. It's so simple, but it is the exact feature that makes capital flight a real challenge for the fiat system. So all this to say, you just want to own the things that no one is selling and hopefully the things that other people will buy in the future and if you follow that north star i guarantee you you'll be in a good good place yeah no do you do you buy the thesis that in a an age of compression of the value of labor towards zero and incredible productivity gains

from these tools you're gonna have abundance and therefore pairing it with the scarce asset like bitcoin makes the most sense yeah i think that's right i think there's other assets like Bitcoin too, that can benefit from this tailwind. And also with the cost of labor going to zero, like I'm also not a doomer about that entirely in subscribing to that narrative. I do think like as long as humans are needed, which I think humans will always be needed until we truly get to some kind of AGI, which I think is still very, very far away, especially in the world of like hard physics, like maybe software and stuff, it's getting easier, but like in the hard world of materials, it's significantly underinvested, there will always be demand

for some human ingenuity in the physical world. And so it just means that the cost of labor is changing between the physical and the metaphysical too. And we should acknowledge that. And if that's true, I would almost have to urge everyone to continue to invest towards a world in which you're in touch with the physicality of your own existence it's not to say like it's not to say um anything beyond the fact that like you know you can have thousands of thousands of things created um but if the bottleneck is not software and if the bottleneck is like hardware or a person doing the physical labor well those things go up in value too um and you can't create those expertise either like the people that can like you know do the hard work um

will still continue to be valuable yeah i completely agree there it's um it's an interesting time i think uh like i said reading it and it's like ah it was a bit unnerving but i think also cathartic in a sense because i think um highlighting what the certainties are where we stand and just having a sober recognition of that is the first step to being able to actually operate within this reality and so that's why i really appreciated the piece and um was happy at the time i mean we set this up uh before you even wrote this and so once i read it i was like you know what here's what we're going to focus on because i think uh the timing of of understanding all this can be more perfect yeah yeah yeah that's right um there's a famous quote from uh john

Maynard Keynes, who I don't know if you know, the economist, but he was also on the other side of the Bretton Woods argument with Harry Dexter White arguing, of course, for the version that didn't win. He has a famous saying, which is that it's better to be roughly right than precisely wrong. And that's the spirit of what I'm trying to convey here. You don't know exactly where the future is going to be, but it's better to be roughly right than precisely wrong. And what you don't want to be precisely is beak exit liquidity upon something you know is inevitable. And if you just hold that, I think it should provide some comfort in adopting a more kind of positive outlook towards what you can do with high agency, rather than being kind of

captively forced into mechanisms that otherwise the system will constantly try to work against you. yeah perfectly said jeff uh really appreciate your time this morning this was a an incredible conversation yeah no this is super fun thanks for having me and the thoughtful questions so we could have a good banter for it yeah want to do it again at some point let's do it all right peace and love freaks thank you for listening to this episode of tftc if you've made it this far i imagine you got some value out of the episode if so please share it far and wide with your friends and family we're looking to get the word out there also wherever you're listening whether that's youtube apple spotify make sure you like and subscribe to the show and if you can leave a

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