TFTC: A Bitcoin Podcast - Tales from the Crypt #110: Saifedean Ammous

Episode Date: October 25, 2019

Join Marty as he sits down with Saifedean Ammous, author of The Bitcoin Standard, to discuss: - Academia - Bitcoinization might not play out how you think - The collective "We" - Building his Economics course - much more Check out Saif's website and academy - https://saifedean.com/ Shoutout to this week's sponsors. Cash App. Head over to the App Store or Google Play Store, download cash.app and start #stackingsats today. Use the promo code: "stackingsats" to receive $5 and contribute $5 to OWLS Lacrosse you download the app. Casa. Use promo code “TFTC” to get up to $250 off your Casa membership … or hit their team up [e-mail] for a free demo, or to put them to the test with your hardest OpSec questions! Subscribe to our YouTube channel: https://www.youtube.com/channel/UCtdbWsnfA08KhSUO4amVLaQ?view_as=subscriber Contribute to the show: https://tftc.io/contribute/

Well, hey there, freaks. It's your boy, Marty Bent, here to introduce this episode with Saifedean Amoos, Dr. Saifedean Amoos, the author of The Bitcoin Standard and founder of Saifedean.com, where he is teaching Austrian economics courses online to anybody who's looking to learn about Austrian economics. So go to Saifedean.com, check out his courses there um and enjoy this podcast where we dive into the reason for safe uh building this product this this class uh his thoughts on academia and the university system and the state of academia and and the way the hierarchy works very fascinating conversation uh if you recently saw uh our real vision interview this has a little bit of overlap but actually not a lot

of overlap overall it is uh more focused on uh the class that safe is building and again the university system today this episode of tales from the crypt was brought to you by our friends of the cash app i don't know if you freaks know by this point but they just announced that they're going to allow users to buy stocks on the cash apps and not just stocks but uh fractions of stocks at that so you already have the functionalities of the ability to be able to buy it and sell bitcoin you're able to stack sats sell sats send sats off the app to a personal wallet from a personal wallet to the app then you get the boost program on top of that where you can go to boost partner merchants with your boost enabled and save whether it be whole foods

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Austrian economics it was a pleasure as always to sit down with Saif and do this interview unfortunately this one was a quick 45 minute guy again we gained like 15 minutes with Saif from the first episode, I think the first episode was like 30 minutes

of conversation maybe 35, I think we bumped it up to 45 minutes here, so a little bit more time And hopefully we'll break the 60-minute mark next time. Again, go check out safedean.com to see what SAFE's building in the Austrian economic online world. Cheers. Peek-a-boo.

What is up, freaks? It's your boy Marty Ben here in a very foreign studio here at Real Vision Studio sitting down with Saifedean Amoos. Saif, what's going on? Hey, Marty, good to see you. Good to see you. I mean, we just sat down for an hour

and did an interview for the Real Vision crew there. Let's do more. That was a lot of fun, dude. It was, thank you. For you freaks who don't know Saifedean, I don't think I need to introduce him. Author of the Bitcoin Standard, prolific Austrian economist,

memeing Bitcoin into the world. We just did an hour interview for Real Vision talking about gold versus Bitcoin. And we're here to talk about Saif's new website, some new thoughts on uh the supply side of bitcoin and uh other things so what's going on dude um well what's going on is that i have just quit my university job i'm no longer a university professor and i'm now um my own university professor i've set up my own website and i'm going to be publishing my research on it and teaching online courses there and i think this

is a much better thing for me to do with my time than to teach at universities because i think universities are dying and it's good to get out of them they're terrible for the professors if you've met any professors you know they don't enjoy um how much the job has deteriorated over the last few decades and it's become terrible for the students as well students pay more and more and more and more and get worthless credentials and very little real education that's what we're talking about uh over there a little earlier was i i just in the last decade went through four years of uh university study economics here in in the u.s and didn't once broach the subject of austrian economics why why why is it that austrian school thought isn't taught throughout the country

well the short answer is basically that since the 1930s uh universities have become practically government agencies they the majority of universities particularly in the u.s and you know where the u.s leads the world follows particularly in the u.s universities get the majority of their funding from government or from government regulations that allow them to behave in certain ways so they get their research funding they get subsidized loans for the students that allow them to pay for the universities and so universities are highly linked to governments and austrian economics is just very bad news for governments and you know it's not because austrian economists are just you know hateful anarchists who hate your favorite politician

although that is probably true but it's also because economics itself is against your stupid government most likely and all of the stupid things that it does because economics is about individuals acting to achieve their own ends and trying to use the knowledge that they have to figure out the things that make their life better and as you study this you realize that the imposition of restraints on people and the use of force to force people to take decisions in a way or the other or to try and interfere in their decisions in a way other than what they would choose that might sound like it's nice from a central planner's perspective that you know we can just pass a law that says, you know, apples shouldn't be sold for more than $1. And then

everyone will have apples for less than $1. And that sounds great. And that's kind of what, you know, your government wants to hear. That's why it hires the kind of economists that tell it these kinds of stupid ideas. And that's why, you know, they don't hire Austrian economists, because if you asked an Austrian economist about, you know, let's put a price cap on apples so that children will only have cheap apples to eat, he'll tell you you're an idiot. That's not what governments like to hear. So that's why all of your government-funded universities

don't have Austrian economists, which is fantastic news for me because it basically gives me almost a monopoly on the teaching of Austrian economics. Well, that's what I was going to segue into. I mean, especially here in the States, it seems like our, at least on the democratic side, if we're going into this presidential election,

and you're looking at the options on the Democratic side, it seems they're going very, very far, Keynesian, policy-driven. AOC, in particular, has talked about price ceilings for rents, I believe. Bernie wants to make everything free, debt jubilee, and that such. But it does not seem like there is an Austrian mindset in the mainstream at all. No, absolutely, and it's entirely the—well, not entirely, but to a very large extent it's the fact of just the complete absence of economic education education that makes people think that these absolutely insane ideas could make sense that

you know let's just take all the money from all the rich people and give it to all the poor people and somehow society gets better well no this has been tried before and all that you're doing you're not giving money to the poor people you're taking money from productive people and putting it in the hands of bureaucrats who are unproductive to go and distribute it in a way that gets them re-elected and um that's been an excellent recipe if you want to destroy a society if you want to turn it into a big pile of rubble um running these kinds of policies that punish people for being productive that reward people for being parasitic bureaucrats that reward people for being demagogues that reward people for telling you that the problems of your life are not because you're

not taking care of your life but they are because rich people are taking care of their lives um you This is all economic ignorance, and Austrian economics fixes this. So what comes with your course? How did you construct it? What was your mindset building the course? What's the flow of it? What can your students expect? Well, so I initially taught a couple of courses based on my book

and then one on the new research that I'm doing for my next book. These two courses have concluded. But these were my kind of trial balloon where I wanted to try things. but the real project that i wanted to get into is is what begins in um now in a couple of weeks october 21st is the first class and that is the beginning of building an entire curriculum for austrian economics that will be available online and i don't think any university in the world has a full curriculum in austrian economics courses and this is what i want to do so the first course which begins on october 21st will run for 10 weeks it'll have 10 lectures the

lectures are done over zoom video and you can download the you can join the lecture live interact and then there's lectures on mondays and then on thursday there's the discussion section which is more interactive you can join them live or you can download them as audio or video or watch them later you get the class notes and the syllabus and so the idea is that you know you attend the lecture every week and then you do some readings and over 10 weeks you'll effectively learn the basic principles of economics the point of this course is really the very basic fundamental ideas that are necessary toward understanding economics and then future courses i'm going to build on this further this there's sound outside it's not gonna pick it

up in the mic something i think you're good um but you're starting like with intro like what is the intro to austrian economics do you just read rothbard well initially i wasn't really sure about which textbook to use so i ended up just using all three that i had been considering because they're all too good to pass up. So the first one that I was thinking about was the newest because I thought it would be the easiest to read Rothbard's book, Man, Economy, and State. But I think I later on introduced Human Action by Ludwig von Mises

and Menger, Principles of Economics. So we start off with Menger. What is an economic good? What is utility? What is value? And the most important starting premise of Austrian economics, The most important topic in Lecture 1 is subjective value. It's just understanding that in economics, value is subjective.

There is no such thing as economic value without a human being valuing things. And so all value is subjective, and being subjective means that value is present in the mind of people and mind of individuals. It's not inherent to goods themselves. so there's nothing that says that say a computer has to be worth a hundred dollars it could be worth a hundred dollars for you today it could be worth a thousand dollars for you today if it means having this computer for you today means that you can finish a job that's worth a thousand dollars for you then the laptop is worth a thousand today it could be worth nothing in a situation which you have 10 laptops already and you don't need this one then you wouldn't be willing to pay

one dollar for it so the value of things changes across time and understanding this is a massively important concept because most economists today don't understand this because they think economic economic value is something objective and so some kind of economists think that value is determined by how much work goes into making things and other economists think that you know value is the same thing as the price that emerges on a market which is a big misconception and the result of these is is you look at modern economics you know you see all of these mathematical equations that aim at quantifying utility and economic value and to try and study them in a mathematical way and to try and make economic policies in a way that maximizes utility for people or maximizes

utility for society and once you understand the subjective nature of value you realize how dangerous those things are and how completely unworkable they are because you're trying to fit numbers on something that is fundamentally unmeasurable with numbers yeah and this is something we we touched on an hour ago too is the the flawed kpis that exist in the in the current system so the system revolves around these kpis that don't really that are very objective as you Yeah, the modern macroeconomic stuff that you learned at university, and I'm very sorry about having to go through that scam, but that scam... You don't believe in the Laffer curve? I mean, this fixation with all of these metrics is a result, is not something that is helpful for us in understanding economics at all.

I mean, if you spend five years doing Keynesian equations on trying to understand the macroeconomy, you will end up having a far inferior understanding of how economics works than if you hadn't done any of this stuff. So it's not because it helps us understand economics. It's not because it helps us predict or design policy in a better way for whatever. It's simply because this is how governments can function with things. Governments need metrics because they need performance because they need to – they're making decisions for society overall and they – on an individual basis, the only data you deal with are your own preferences and the prices that are on the market. But when you're trying to make decisions for society overall, you have to make them based on some aggregate decisions. And the fixation over the 20th century was to assume that just because we'd like to have these aggregates so that we are able to make decisions, that they must therefore exist. And so the most mainstream economists are essentially failed physicists and failed mathematicians and statisticians.

And intellectually as well as individually, but as a field, overall, economics is just bad math. It's just people who couldn't cut it in the math graduate program or in the physics graduate program ended up in the economics math graduate program because it's a little, it's a lot easier in terms of the math. And also it's a place where the math has absolutely no reason to work or make sense because there's no connection to reality. You know, you're dealing with all kinds of different statistics that are really, you know, there's no track record of being able to predict anything. And these statistics are made up because they help government come up with ideas. But they have a terrible track record of predicting how the world will actually unfold. And the other reason we use these silly numbers is, funnily enough, because it's useful for making multiple choice exams. for the kind of mass-produced industrial kind of education

that takes place today, when you're trying to teach people Keynesian economics, you know, it's useful to have all these numbers because then you can make easy exam questions, you know, where effectively you're testing students on math skills, on mediocre math skills, and just how they are able to follow the instructions of the textbook to believe those things.

As I was saying, the analogy with physics and math was that we could just have these metrics from just like an engineer uses metrics like speed and pressure and velocity and all of these things and can make equations and make them predictable. Macroeconomists have spent a century trying to do the same thing with economics

and have failed miserably at every single model of trying to establish some kind of scientific relations. But it hasn't stopped them because there's money in it and government provides money for it. And so the state of economic education has just been a giant game of naked emperor for the past 80 years. And the only people who are allowed to comment on the emperor's clothes are people who get paid by the emperor. Yeah, and it seems more recently the whole argument has been reduced from a math problem to just screaming at people dead as money. yes the most uh the most advanced mechanism of uh also keynesian teaching is just for demented keynesians to go online and tell you that debt and money are the same thing because you know

in the world of keynesians words don't mean anything and so anything can mean anything if kane says so none i don't want to rehash the conversation we just had but i think it's important for this podcast too if you freaks don't listen to our interview on real vision but one thing safe and i just talked about was the the delusion of the collective we that that goes into the the assumptions of this model yeah macroeconomics is really the main function of macroeconomics is just get you to believe in this mythical crazy monster that they call a we which is this universally good entity uh and the government acts on its behalf and somehow you know the people in government always benefit from this we and you always get hurt from it and the reason

of course is that there is no such a thing as a we just because we all happen to believe in the same national anthem and the same flag doesn't make us one single accounting entity so that there is no difference between resources being in my pocket or yours and Keynesians of course want you to believe that because you know the we is always them and people in power making decisions about you and what you need to do and of course you know you're they're the ones who benefit from those decisions you're the one who doesn't benefit and so this is this we in Keynesian mythology is how you're able to just get over any concern about debt you know well it doesn't really matter because we all owe we owe this money to ourselves and so it's not a problem but it's not money that

we owe to ourselves it's money that different people from this we owe to different others from this we when you're um you know when your landlord comes to correct the lent you can't just tell him well we are living in this house and it's good it's all good bro he's gonna ask for the money to move from your pocket to his and all of the stupid macroeconomics that you learned at university is not gonna help you there um but ultimately of course the reason they do it is the we that they want to conflate is the future generations so you know um actors like paul Krugman, who play economists on the internet, get paid from their government-financed university to promote these ridiculous ideas to you, and that money is financed from government debt, which

your children will have to pay. And so Krugman and your children are both we in the world of stupid Keynesian economists, even though your children will spend all their life paying off Krugman's salary, somehow, you know, by putting it all into a we, we've all gotten rid of all that differentiation this is yet another kind of the brain damage that has afflicted a lot of people because of keynesian education but don't worry austrian economics fixes this do you do you see like a like it feels i mean i feel like we might be not jaded but just uh we're in our bubble we're in our bitcoin bubble obviously our austrian economics bubble to me at least it seems like more people are interested in austrian thought and learning about austrian thought in particular

Obviously, you're teaching a class. Are you seeing the demand for your class rise? Is the resurgence happening? Do you think there's a renaissance of economic thought happening right now? For sure. Absolutely. I mean, this is why I left my job teaching stupid Keynesian economics in order to teach real economics. Because, you know, thanks to my book and thanks to Bitcoin and the enormous increase in interest in Austrian economics amongst Bitcoiners, now that there's enough of a critical mass, I feel, for me to be able to run this as a business, to not have to go into a university where I have to write research grants to governments and all these barbaric practices that are still carried out. What's that process like? It's terrible.

If you look at what university professors do these days, ultimately universities don't even care how good you are of a teacher. It's almost completely inconsequential about how you deal with your students. As long as you don't rape them, you're pretty much set. they don't really care about how you teach what you do in your class most teaching is done by assistants anyway what the universities care about is your ability to write research grants that get them money from government and so this is why your university professors have never written anything that you have found interesting or intelligent it's or relevant to anything in your life because

they're not writing to help you and your life they're writing to impress the people who hand out research grants and so effectively you know government is just another i mean education is just another industry that's been destroyed by government control so now students pay a lot of money but it goes to the bureaucrats and professors work a lot but they don't get paid you know professors get paid so little compared to how much work they do and the risk of the job of not making it to a full-time profession is enormous um and and and this is all because you know and if you look at how much students are paying, if you look at the last 40, 50 years, tuition has skyrocketed and yet professor pay has not skyrocketed. Professor pay has stayed stable, maybe gone

down in certain cases. Depends on how you look at it, but it's definitely not gone up anywhere close to how much tuition has gone up. And yet, so where is all that money going? Are they getting more professors? Nope. Classes are getting smaller and so students are paying more money to get fewer and worse paid professors to teach them and spending more time with adjuncts and assistants and so on. So where exactly is all of that money going in your university? Well, ever wonder why your university's vice associate president for student engagement has a summer villa?

That's why. Because there's all these parasites in universities, these administrators whose existence in a university has really been made completely redundant and obsolete by the invention of practically really, you know, Google's free software package makes all university staff that are not professors completely redundant.

Like there's nothing that anybody at a university does for me that I can't do. Maybe free software, maybe $100 a month of software at most. I can replicate all of the services that all of the administrative staff at my university used to do. And they don't do anything valuable generally. The university is a bureaucracy like all bureaucracies.

It faces no real market test, and so therefore it faces no real impetus to be efficient. On the contrary, its impetus is to constantly get bigger, to take up more resources from the people who finance it. And that's why if you're a university, you don't get successful by teaching people relevant things that get them to go out and have jobs because that would be a university

that's successful in a free market. But in a government-controlled market, you become successful as a university by having a lot of administrators who fill out all the right paperwork and do all the things that get you connected, correct, get you on the right side of the people who dish out the government funding

and the government regulations that are favorable for you. And so, you know, it's no wonder The actual teaching that takes place in a university has almost become completely secondary to the university experience for students, which is becoming more and more about all things other than actually learning. It's about football games, drinking. It's about football and drinking and all those things. And there's nothing wrong with those things. You should obviously have the freedom to do them, but there's something very wrong about the institution of the university being dedicated toward these things, you know, running all these football leagues and engaging in all of this politics and all of the political things that universities do. It's, you know, you're paying for that as a student, and it's not going to help you in the long run.

so for me really i think uh the the people are noticing this people are beginning to wake up with everybody who goes to university graduates and then sees yep you know i've spent all this money on all this debt and i don't know anything that i couldn't have learned with a couple of months of googling on my own for zero dollars online and i think you know the the reality is considering the current cost of education it's almost insane if you have if you have the money or if you don't have it to get into this much debt or to waste that money on a job. Like if you think about it,

some people will get into $200,000 of debt for a degree. Now, if you think about it, anything that you learn in that degree, all of the books that you read, all of the syllabi, all of the professors, you can find all of the books, all the material online close to free. If you needed instruction from the professors,

you could arrange to have private classes, private discussions with them, hire them as consultants. And you could get all of the education you did for $200,000 if you wanted to really just get the actual education itself. You could get it for, I would say, no more than five and in no more than two years. No question about it. And I'm being generous here. You could probably do it much cheaper and quicker.

So what do you do with the other $195,000? That's the question people don't ask themselves. And my answer is, whatever you think you want to do, whatever industry you see yourself in, oil and gas or restaurants or whatever it is, you know, instead of going to university, get a very basic job in one of those industries at a very bottom rung or go to a cheap university, at least if you really want to get the degree or if you need the degree. But don't blow $200,000 on some fiat universities' worthless credentials. Put 10 of these for education. Learn everything you want to learn over time online. And put all of this money and then have those $190,000 that are left as a starting investment for you. Take a few years to learn things and then put those $200,000 to work.

And you're starting off, instead of getting into $200,000 of debt, you're starting off, well, the alternative is you blew it all on university. Instead of blowing it all on university, you have it as a starting capital. Or you start off with no capital and instead of having $200,000 of debt. I think, you know, you learn everything and you'll have a lot more time. And yes, you're going to miss out on the frat parties and all of that. But, you know, if you work hard in the age of 18 to 25, you're going to have much better parties. Later on, you know, you won't be in the dinky, dirty fraternities. You'll be partying in much nicer places.

I agree. But it's so fucked up how, especially here in America, like we're almost forced down that path like you have to do, or at least up to this point, to the millennial generation. But I do think, I do agree with you that the tide is turning. Like you don't. Yeah. like your model i think if i'm going to go learn austrian economics and particularly austrian economics with the bitcoin tilt i'm going to want to learn from the man who wrote the book so your model at which like you can go on a website and access the man who wrote the book just see if we're

a vastly uh reduced price seems like a no-brainer yeah absolutely like you can take the whole course for a hundred dollars which is a tiny fraction of what you could take a course at a university for and think about all you know the the the difference in the cost you know you could say that well you know you're online and it's not the same as being in a class well yeah but with the difference in the money you could come and fly and meet me and hire me and talk to me for an entire day or two or a week and still have a lot of money left for your car for your career so it's it's it's an insane amount of money and it's you know all these people protesting about the student debt. I mean, it's, yeah, it's a very, very, very big problem. Yes, it's a big

problem that you have $80,000 of debt because you've gotten a degree in some stupid thing or the other from a stupid university. That's why people should stop doing it. And really, you know, universities need to shape up. Universities need to realize, look, the internet is out there. We no longer need you. You were relevant when your library was the only place in town where people could go and actually read important knowledge and your professors were the only people in town who could go and explain those books and tell people where to find them and explain to people how to use them but now everybody can find any book anywhere online and anybody can find people online who tell them what to how to learn those books so the need for the university is much less

than it was before and yet the costs of it are much higher than it ever was before yeah so they're they're really backing themselves into a corner at this point and i'm thrilled and delighted to have gotten out of this sinking ship and to be working individually with people to developing that actual student teacher relationship which universities have almost destroyed because you know universities are credential mills and so most students aren't even interested in what you're there to teach them they're just there for the degree and professors are you know the vast majority of my time as i was saying earlier is just filling out research report filling out research grants and filling out stupid forms that are being handed to you by your university's

administrative administrators who are just you know getting um you know giving themselves um trying to make themselves look like they're actually working by getting professors to fill out forms and do things and attend meetings and all of this bureaucratic nonsense that takes up about a third of a professor's time. It's completely inconsequential nonsense that doesn't even need to exist.

It's make work. And if we had a free market system in universities, it would really be amazing to see. Imagine if we'd had people like Steve Jobs and all of these incredibly successful CEOs take on the university challenge over the last 40, 50 years, taking on a university

and trying to really make it into a really well-oiled, efficient machine. I mean, it would be completely different from what we have today. And I mean, again, as somebody who's gone through the university system in the last six years, I graduated college about five years ago.

Yeah, it's like the last decade, it is woefully incompetent, woefully. I did not get my money's worth at all, I don't think. I learned more. Luckily, I was able to intern starting my junior year, and I took night classes and worked during the day and learned more at work than I did at school. Yeah, I mean, if you had not gone to university

and you had focused on the night classes and on internships, you would have gotten far ahead in life, and you would have saved probably a lot of money. I mean, obviously, there will be people who are going to get triggered by this, and I'm sure your college is an exception to what Marty and I are talking about, and I'm sure your own professors are great. And of course there are exceptions and there are great degrees

and there are great professors and there are jobs that you can't have without a college degree and I'm not telling you to go learn brain surgery online and go practice. But the vast majority of people don't have any good reason

to be wasting their money on their local government education camp. I do agree. i think more people are waking up to that and i think your model is is refreshing to see the fact that it's cheap that's accessible and the whole concept of like the the teacher pupil uh relationship like you mentioned it's been bastardized at this point yeah i that was the thing that i was getting at this uh this allows me to have a much better relationship with many more students because it's so efficient because you know the student can learn can go through the 10 hours of lectures

and do 100 hours of readings and he can he needs he can do all these things without needing to interact with me so this stuff can scale infinitely essentially and then whatever individual questions they have you know the the we can do these over email or over during the lecture during the discussion and because so much of it is automated so much of it is you you know leveraging the digital capacities of them watching the lecture on their own they can send me the email and i can respond to it whenever i want and so the amount of time it takes is so much less than the alternative which is where the student has to come to university to come to my office hours and you know when you when you think of all the other things that they

need to do in order to get the university degree and all of the other things that i need to do we're getting rid of all of that essentially removing the middleman of the university and all of its um administrators and just re-establishing a relationship between me and the student oh congrats thanks are you nervous at all going on this journey are you excited or both um i'm i wouldn't say nervous no because i took my time i took a year off from university to work on this and to build it and you know i did the first two courses i saw how it worked and i um And I've seen the benefits to me in terms of just the work itself, how much more I enjoy the work, how much better life is because I don't have to deal with a lot of the nonsense that I was made to deal with because I was working in a bureaucracy. And I think it makes me, yeah, it doesn't make me nervous at all.

I think just whatever happens financially, I'm not, you know, I obviously can't know if it's going to be a good step financially. It is a bit of a risk financially, but I think the mental clarity that it will afford me by not having to deal with all kinds of nonsense that I don't like to deal with is going to be worth it, whatever happens financially, I think. So I'm happy about it, whatever happens. Well, congrats. I'm happy for you. Thank you, sir. It sounds like you're following your passion. I am, yes.

I'm going to keep talking about Austrian economics until the world will give up trying to convince me to stop. Well, we've got like five more minutes left before the next interview rolls into the Real Vision studio. Let's end it on the topic of the supply side of Bitcoin, which we discuss. And this is something that you think is very underscored, if not completely underscored, within the realm of debate within Bitcoin and its fundamentals.

So what are your thoughts on the supply side of Bitcoin? People talk about the demand side a lot. Yeah. i think i think i think the the it's the effect of bitcoin on the supply side of the dollar actually yes you're referring to yes so generally among bitcoiners the idea of how bitcoin wins has generally taken the shape of everybody will find that bitcoin is mooning and so everybody wants to dump their dollars and fiat money and move to bitcoin and so this then leads to bitcoin appreciating and all the other currencies collapsing and so we have hyperinflation

everywhere and bitcoin rises from the ashes and while i appreciate the sentiment um i think there might be a bit of a problem there in that uh what this analysis looks at is just the demand side for the dollar but it doesn't look at the supply side and i think that's more important because hyperinflation is always a supply side phenomena it's always uh it's always the increase in the supply of money that brings about the hyperinflation it's never the case that um the value of money collapses because the um because people just drop their demand for it you know people don't just one day wake up in venezuela and decide you know what our demand for venezuelan bolivar today is one millionth over what it was uh last year and so the value of the venezuelan bolivar goes down to a

millionth of what it was that's not how it happens what happens the central bank prints a million times as much money as it had, and then the value of the currency collapses. So if we're going to get hyperinflation in the dollar or the euro or any other currency, it's not going to be just because people dump the value, because the central bank at the end of the day can still maintain, still has an important ability to manage the supply. And so if demand for a currency were to drop, the central bank can prevent hyperinflation from happening by reducing the supply of money through various mechanisms but the most important mechanism of creating money is ultimately the creation of debt so the banking system when a new loan is issued

new money is being created so the process of debt creates new money so what i discuss in one of my research reports which is available on my website safe at dean.com is to think about the implications of the rise of Bitcoin to the supply of the dollar, in particular, to the supply of the dollar from the creation of money. And so if everybody is moving to Bitcoin, they won't just be holding fewer dollars. They will also be borrowing fewer dollars. In fact, if you move to a bitcoin-based economy you move to an equity-based economy where the not a debt-based economy the money in our current monetary system is largely is debt it's it's it's created by the creation of debt so when your government borrows more new money is created when your bank issues

new loans new money is being created but bitcoin is a hard asset no new debt is created when new money is made it's a hard asset and the uh you know the cost of producing it is paid up front you have to mine it like with gold you pay the money and then you mine it unlike with credit where the money is generated now and then the cost or or the um you know the value is expected to follow later so um so if you think of more and more people moving to bitcoin and you think about Bitcoin rising in value, so more and more people now no longer need to keep borrowing dollars because they can just hold on to their Bitcoins and they can finance their expenditure from Bitcoin rather than from borrowing, then you see the demand for borrowing declines.

And if the demand for borrowing declines, that means that the new money creation also declines. Which means that, and this might be the craziest of all my crazy ideas, that bitcoin might just be the technological solution to the global catastrophe that is government money government fiat debt money that we have because bitcoin allows us to gradually one by one monetize a new hard asset similar to gold and move off a debt based monetary standard it allows us to move away from it without having to suffer the collapse of the fiat money because we're not moving from the you know when we're witnessing the when people are moving away from the dollar they're witnessing the supply decline and the

demand decline and central banks you know unless they do something excessively stupid should be able to manage this process of decline maybe i'm being too optimistic but i i don't think it's it's a foregone conclusion that we'd have hyperinflation because we can get a deflationary reduction in the supply of money as well as a reduction in the demand for money which could keep the value of the money relatively stable or at least declining in a managed controlled way and not declining suddenly and being completely destroyed in terms of its value like bitcoin Sorry, like in the case of hyperinflation. So it might just be that Bitcoin allows us to get out of this mountain of debt that exists around the world

by just basically allowing every single individual to get out of debt by holding Bitcoin and moving toward the Bitcoin-based economy. So it's just sort of a controlled transition, if you will, a little bit almost. Yeah. It's like, you know, imagine this. Many people say, well, this monetary system is a big house of cards. that is true a house of cards should fall but bitcoin might just be in the this new brilliant machine that can take apart this house of cards and turn it into a deck of cards and get it over

without it falling apart because it you can think about you know always there are two cards leaning against each other think of those as the supply and the demand for bitcoin and bitcoin removes those at the same time decreases the supply and the demand one individual at a time and I think perhaps we might want to consider the scenario that Bitcoin doesn't emerge in a bang where all the other monies are destroyed, but Bitcoin continues to grow and all the other monies continue to grow in irrelevance as Bitcoin grows. And so maybe, you know, 100 years from now, maybe the fiat economy is 10% of the Bitcoin-based economy and effectively is just a bunch for, it's just a place for, you know, statists and Keynesians to continue to LARP. um this is i love this thought experiment because this is actually what i would prefer sort of and it does make a lot of sense if you're if you're removing supply and demand in equal increments individually uh across the mass across the we if you will um and it makes

a lot of sense and we are getting kicked out here uh let's wrap it up i feel like whenever we meet we only have like less than an hour to talk uh on recording so the next time you're you're in new york we got to get like a two-hour banger right yes well yeah so it's my way of leaving you keen for more but definitely yeah still on that thought freaks the uh the controlled transition um is there anything you want to you want to say before we sign off here let me just show my website again safeadeem.com you can go there you can buy the research report that i just mentioned uh there are seven of them um and you can sign up for my austrian economics courses and you can also find all the translations

of my book so check it out safedean.com I feel like I feel like we can comfortably say the book has been translated into

dozens of languages by now 14 and we're about to do 15 16 yeah we're at 14 now we're in our second dozen yeah second dozen

alright safe it's always a pleasure likewise Marty thank you peace and love freaks okay