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Read_945 - Milei's Austrian Scam by the Numbers
00:55:48
"The peso scam is around a thousand times larger than the Libra scam, and its victims are the poorest, about 95% of Argentines." ~ Saifedean Ammous Javier Milei swore he'd burn down Argentina's central bank and dollarize the economy. Two and a half years later, the money supply has quadrupled, the debt has ballooned, and a quarter-trillion-dollar carry trade is hollowing out the nation. Is the self-proclaimed Rothbardian actually running one of the most inflationary presidencies in Argentine history? And what does it mean for Austrian economics when its loudest political champion looks more like just another Latin American demagogue? Check out the original article: Milei's Austrian Scam by the Numbers by Saifedean Ammous (Link: https://x.com/saifedean/status/2056436088944631996) References from the episode Safedean's previous piece on the Argentine carry trade (Link: https://saifedean.substack.com/p/anatomy-of-the-milei-ponzi) Hans-Hermann Hoppe's work, since the Mises Institute ...
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Money supply aggregates have quadrupled or tripled in a mere 29 months at a compound monthly growth rate of around 5%. An astonishing achievement for any inflationist, let alone one pretending to be a Rothbardian. Consumer prices have also tripled over the same period, also increasing at a monthly compound rate of of 5%. The best in Bitcoin made Audible I am Guy Swan and this is Bitcoin Audible. What is up guys? Welcome back to Bitcoin. Audible I am Guy Swan, the guy who has read more about Bitcoin than anybody else. You know, we've got a great little piece by Seifudine off of a Twitter a twarticle on a recap of Melies 1st 2 1/2 years in office. The self proclaimed Rothbardian and Austrian economist who swore that the one thing he had to do absolutely there was no questions asked, he was going to get rid of of the Argentina Central Bank. How is that going? And specifically let's ignore the rhetoric, ignore the claims, ignore the cultural, the apparent cultural shift. Let's just look at the numbers. Has he done an Austrian job at fixing the economy? Really interesting little piece, especially for myself and I say in the the commentary after this or whatever that I really just have not kept up with it at all because the only two political anythings that, that I got a little bit of hope or interest or excitement about very quickly seemed to turn around on some of the most important things that actually gave me a little bit of hope. And maybe I'm just stupid for having some sort of hope left out or this, this little corner of myself that still wants to believe there's some way to actually make some sort of a meaningful improvement to the system simply by the sheer magnitude or the force of people wanting it to change. You know, I kind of part of me wants to see like part of me thinks that, that that side of me is a moron and is a naive little child. And sometimes that's the one that's the part of me that's usually holding the reins is the one that thinks the other part of me is an idiot. But then I also, I'm a bit of a romantic in the sense that I believe genuine change can occur. And it's like one of those things. You know, most people had given up on digital money. Most people had given up on decentralized stateless money until Bitcoin came along. And Hal Finney was ever the optimist and he jumped on it, despite his interest in his watching of every project fail one after the other or not be good enough or not solve the problem the right way. He was still right on it and he was the first one to bitcoin and so I still think there's got to be some chance somewhere there is something that will make a difference. But you know, it depends on which side of me you're talking to and what day of the week it is. This show is brought to you by the bitbox, by the way. Shift Crypto. These guys have been building open source bitcoin wallets for a long time and they have some fantastic I've just always loved Bitbox. I love Bitbox 02 and I just got my O2 Nova and I've said this before but I think they have one of the best all in one like like start to finish package of just an accessible way to have an easy to use hardware wallet. Easy to use software to have somebody who's never done it before go from zero to holding their own keys. So check it out. Discount code and affiliate link right down in the show notes. With that, let's get into today's episode. And again, this is a tour article from Safe Link will be available in the show notes and it's titled Milie's Austrian Scam by the Numbers by Seyfeddine Amus As a libertarian, anarchist and Austrian school economist, I was interested in following the election of the first president in the world who professed to share my ideas. He said a lot of the right things on TV and his radical policies seemed similar to what I would want implemented. After 30 months of close observation, I can confidently say Javier Miliee's policies bear no resemblance to what an Austrian economist would do, and he has used Austrian economics as a cover to run one of the most inflationary presidencies in Argentina's highly inflationary history. Predictably, and in light of the most recent inflation and growth data, it is now safe to call Miliei's presidency a a failure on all the important questions. Ignoring inconsequential rhetoric, Milie has been just another Latin American inflationist demagogue, selling his citizens pipe dreams financed through inflation and debt that will burden and impoverish them for generations. In the 30th month of his presidency, when the seed of economic recovery planted early in the term should be bearing fruit, prices continue to rise, economic activity is declining, and the unsustainable government debt Ponzi is larger than ever, suggesting much more pain to come. The never ending inflation the biggest promise broken by Miliei was the promise of closing the central bank which he claimed was non negotiable during his election campaign and is the Austrian position. He had a clear mandate from his voters to do this, but he chose not to and shifted to silly Chicago Keynesian nonsense about managing the money supply and reviving the peso. Melie had promised to dollarize the economy, which would have been a great move for Argentina because as bad as the dollar is, it is superior to any currency issued by an Argentine central bank. The promise of dollarization was also broken in favor of what Milie termed free competition in currency. A ridiculous idea when the central bank still maintains a monopoly on banking licenses and mandates that banks use the peso and hold government bonds. By keeping the central bank and maintaining its monopoly over currency issuance and banking licensing, Milie guaranteed a continuation of peso inflation, forcibly impoverishing Argentina. The proof is in the pudding. March's consumer price index rose 3.4% in in one month, an annualized rate of 49%. And that's using the government's obsolete basket. This was the 10th consecutive month in which the rate of price inflation has risen. And it makes Argentina the country with the fourth highest price inflation rate in the world, behind only Venezuela, South Sudan and Iran. After 2.5 years in office, this is Milie's inflation and it is hollow to blame it on his predecessors. Prices are not a perpetual motion machine that cannot be stopped. Once unleashed, price rises are of the consequence of the increase in the money supply. And if the central bank stops increasing the money supply rapidly sustained price rises become impossible. After Ecuador and El Salvador dollarized in 2000 and 2001 respectively, high consumer price inflation practically ended as a problem. Consumer price inflation is now in the same range as America's in the single digits, far from ideal, but far further from the usual Latin American rates which Argentina continues to suffer. Had Milie gone through with dollarization or liberalization of the central bank, inflation would already be a part of Argentina's history. By keeping the central bank monopoly and not dollarizing, Miliei has ensured it is in Argentina's future. The excuse that the currency and banking system were in bad shape and that dollarization would have been too painful rings especially hollow after two and a half years of continued inflation and economic deterioration that shows no signs of abating. While El Salvador's inflation was low before it dollarized and its transition was smooth, Ecuador's dollarization followed a currency and banking collapse. So it is more relevant to Argentina After Ecuador's calamitous currency and banking collapses and after a period of adjustment to dollarization and price controls. High price inflation was eliminated after two and a half years. Without a national currency, the Ecuadorian central bank could not create hyperinflation even if it wanted to. In all likelihood, whatever pains dollarization would have entailed for Argentina would have been over by now and the benefits of eliminating inflation would be evident. But the path Mileier chose has been delivering pain for two and a half years, and it promises to deliver a lot more ominously, when April's monthly CPI number came out at 2.6% or 31% annualized, Mileier tweeted triumphantly that it is a return to normal. Given that a year ago he was celebrating the rate dropping below 2%, he seems to be conditioning people to view prices rising prior to permanently by around 20% a year as the new normal. Given what he has been doing to the money supply, 20% seems optimistic. Quadrupling the money supply price inflation is merely the manifestation of inflation that the economically ignorant can see. Those who understand economics know inflation is made in the central bank, not in the supermarket mileies. Money creation has been evident from his first few months in office, which saw a money supply growth that is too large to be believable even by Argentina's own lofty standards. After 30 months in office, here are the total increases in money supply aggregates, along with their compound monthly and annual growth rates, as well as the change in the consumer price index. Money supply aggregates have quadrupled or tripled in a mere 29 months at a compound monthly growth rate of around 5%, an astonishing achievement for any inflationist, let alone one pretending to be a Rothbardian. Consumer prices have also tripled over the same period, also increasing at a monthly compound rate of 5%. Whether looking at money supply metrics or price increases, the Miliei presidency has so far been outstanding in its inflationism, even by Argentine standards. Milie has so far delivered a higher annual growth rate in the monetary base than his four predecessors and a higher annual growth rate in the consumer price index than three of the four predecessors. The $71 billion new debt milie had promised to fight Argentina's chronic indebtedness, but he has instead increased it and in the process made Argentina the IMF's primary borrower, accounting for around 35% of its total lending portfolio. When he took over, Argentina had a massive debt burden of US$423 billion, and that number has increased by 71 billion to 494 by the end of last month. After 29 months, Milei has increased the total Argentine debt burden by 17%, even though the currency has been devalued by around 70% since he took over. In other words, by merely devaluing the currency, Milie reduced the dollar value of the peso debt he inherited by 70%, from 159 billion to $47 billion. And yet, by continuing to issue more high interest peso debt, the total dollar value of peso Debt has reached US$233 billion, meaning Mileie has presided over about US$185 billion of increase in high interest peso debt in just two and a half years. This is the fuel for the Argentine carry trademark. The cancer killing Argentina. The biggest victory Milie's supporters continue to claim is that he has balanced the government's budget. But that seems to be the result of creative accounting as the national debt continues to increase. The most obvious way this paradox is resolved is by realizing that the exorbitant interest the government pays on the LCAP bonds is not counted as part of the government's expenditures. By ignoring the interest burden and the rollover risk of the peso debt complex, the fiscal surplus means little further. A free market approach to government spending is not just about balancing the budget for its own sake. It's about freeing the economy from the shackles of government monopolies and freeing critical institutions from the stranglehold of state control, which prevents them from operating productively and profitably to serve the people. Milie's regime continues to enforce status monopolies in education, healthcare and infrastructure, but is now depriving them of financing, causing the destruction of essential institutions and the continuous degradation of the country. The correct libertarian and Austrian choice would be to liberalize these institutions and allow them to fend for themselves. Without government protection, the productive parts of these institutions would be rewarded on the market, whereas the unproductive parts would disappear. By cutting spending on critical infrastructure that cannot prove itself in the free competitive market, while continuing to pay tens of billions of dollars every year as interest to the bankers and hedge funds. Playing the Argentine carry trade mileier is teaching a generation of people worldwide that libertarianism is about degrading the critical infrastructure and institutions on which the vast majority of society depends in favor of enriching the richest who can afford to play the government's Ponzi, the quarter trillion dollar carry trade Ponzi. As I explained in the previous piece, the carry trade is not merely an inconvenience or a minor problem. Enriching a few Argentines at the expense of the majority. This monetary Russian roulette has practically become the main industry in Argentina and its continued survival hoovers up ever more Argentine capital away from productive activities. In a country whose stock market capitalization is about US$90 billion, the Kerry trade constitutes around $233 billion of investment, all placed into buying government Ponzi bonds at exorbitant interest rates which the government can only pay back through printing obscene amounts of pesos. In less than two and a half years in office, Mileies has added more than two entire Argentine stock markets worth of capital into the government's bonds Ponzi scheme which if it survives a few more months, admittedly a big if, should hit the quarter trillion dollar milestone. This carry trade will of course end in a painful collapse for many latecomers and long term bondholders. But just because it will generate a bad long term outcome does not mean there is a short term upside. In the short term, the carry trade has hollowed out the Argentine economy of productive capital, causing an overwhelming number of businesses to shut down and jobs to be destroyed. While the Argentine stock market is one of the worst performing in the region and the world. Why invest in actual productive businesses when you can just gamble on the carry trade and make 2 to 3% return per month? In two years industrial production in Argentina is down 7.9% and the industrial sector is running at 53.6% of capacity. Which makes sense when you consider that very few industries can compete with returns of investing in the carry trade bond Ponzi. In February alone, the Argentine economy shrank an incredible 2.6%. Unemployment is up to 7.5%, a 1.1% increase on when Milie took office. Had he implemented real reforms, the short term pain would have subsided by now, inflation would be over and growth would be booming. Instead, it seems there is no end to the pain as the carry trade eats everything. The longer this goes on, the the more Argentina loses its productive businesses, dedeveloping from a modern industrialized economy into an impoverished primitive economy where only connected financial speculators can live well while everyone else struggles for scraps. The sooner the carry trade collapses, the better. If the problem with socialism is that eventually it runs out of other people's money. The problem with milieism is that it doesn't as it always finds more lenders to indulge and magnify it. The carry trade has been bolstered by dozens of billions of dollars so far from the imf, idb, WB and most recently the US treasury, which straight up bought pesos to prop up the exchange rate and rescue Argentines from breaking out of the carry trade debt slavery, costing them tens of billions of dollars a year. By keeping the peso artificially high, the bailouts ensure the continuation of the carry trade, directing more capital to the government, depriving the productive private sector of capital and destroying jobs. It will also necessitate more money creation to pay the bonds, inevitably leading to more price inflation. The bailout did, however, save the parasite hedge funds, making absurd returns from Argentine debt slavery when justifying Mileies unhinged support for Israel and its mass murder and theft of the goyim it rules and views as subhuman. Some of Milie's fans concede the criminality but invoke necessity. By currying favor with the Zionist genocidal regime and its American puppets, Milie can get favorable deals from the US and international financial institutions to help Argentina's recovery. This is a catastrophe as bad financially as it is morally. As long as foreigners bail out Miliei's Ponzi, Argentine capital will continue to flow to government bonds, and actual physical, human and intellectual capital will leave or be destroyed as the country is de industrialized and decapitalized. The Thousand X Libra Milie also ran on a platform of fighting the corrupt ruling caste in Argentina and ending their corruption and pilfering of funds. Instead, he has presided over a long series of scandals implicating him, his sister and their close associates and allies in a wide variety of corruption schemes, most notably the Libra scam coin case, which serves as a perfect microcosm of the scam that is Milie's presidency. Mileier promoted Libra on Twitter, saying it would support the growth of the Argentine economy and entrepreneurs and small businesses. As Milei's fans bought it up, the scammers behind Libra created a massive number of them, dumped them on the market, destroying the currency's value, rugging the suckers who bought it, making off with tens of millions of dollars and allegedly paying Mileier a hefty commission. Similarly, Milei promoted his presidency as a way to grow Argentina and save it from inflation and socialism. As Milei fans bought into his scheme, the scammers behind the peso created a massive number of them, dumped them on the market to fund their carry trade scam, destroying the Argentine economy, rugging the Argentine people and making off with tens of billions of dollars. It remains to be seen whether Melies will get a hefty commission or if he's just doing all of this for the love of being called President. Austrian economics and libertarianism are to the peso what decentralization in small businesses are to Libra, the marketing used to lure unsuspecting rubes into the affinity scam. The peso scam is around a thousand times larger than the Libra scam and its victims are the poorest, about 95% of Argentines. Not just random meme coin trader degens. As the peso continues to be destroyed to keep the bankrupt government afloat, the entire Argentine economy is being destroyed. If international bailouts allow this larceny to continue for a few more years, government bonds and foreign aid will be the only two surviving industries in Argentina. The Austrian scam Mileies presidency will leave Argentines with a catastrophic legacy of inflation and a massive debt burden to bear for generations. It will leave us Austrian school economists and libertarians with a devastating reputational debt for generations to come. What makes matters worse is how many of the leading names in Austrian economic circles have completely suspended their critical faculties, ignored the blatant economic reality, believed in the demagogic mania and cheered it on. The Mises Institute has ended its association with Professor Hans Hermann Hoppe, the greatest living Austrian economist and the intellectual heir of Murray Rothbard, in what seems to be related to his outspoken criticisms of the Milie scam. Meanwhile, the Mises Institute has published a continuous stream of pro milie propaganda, ignoring the critical questions of inflation and debt and lauding speeches and rhetoric as if they were actual accomplishments. Tying their mast to the ship of Milie will destroy the great Institute's otherwise stellar anti war and anti state record, turning it into just another center right think tank and using freedom buzzwords to elect neocons to fight more wars for Israel, a slightly less stupid Fox News. Instead of writing more tributes to Milie and attending yet another tear jerking awards ceremony, I would humbly suggest that the Mises Institute and the Austrian milieists provide the rigorous Austrian assessment of the case for and impacts of quadrupling the money supply, borrowing US$70 billion and running a quarter trillion dollar carry trade in two and a half years. Might these factors be related to the persistently high price rises and low growth in Argentina? Is the government saddling its citizens with more debt justified because supporting the Zionist genocidal regime can mean slightly less extortionate interest rates from the imf? Austrians must realize now that the fame and recognition Milie's rise brings to Austrian economics is part of a Faustian bargain whose cost is the destruction of the school's reputation. When his presidency's failure can no longer be denied. Austrian economics and libertarianism will be seen as the ideology of inflation, mass indebtedness to bankers and destroying essential institutions and infrastructure in goyim countries while bolstering the Zionist genocidal regime's institutions for race based mass murder and land theft. You know what my worst habit is when it comes to like nice hardware wallets is my inability to throw away the really good looking boxes. So I finally busted out my Bitbox 02 Nova and I just don't, I can't, I, I'm gonna sit on it. I don't know how long I'm gonna hold on to this box because it's just a good looking box. I mean the box looks as good as the hardware wallet and all I can think is that like I could do something with this box. I'll probably never do anything with it, but I feel like I could do something with it. But it's too big to keep my bitbox actually in it because then like I can't carry it around. And that's like one of my favorite things about the bitbox is I can just, it's small so I can keep it in its little case. It's easy to just keep in my laptop bag or something. But anyway you should get yours, you should check it out. If you are not holding your keys on a secure open source hardware wallet, you are failing. And honestly there's almost no hardware wallet experience that is easier and better packaged than the bitbox. I've got a link right down in the show notes with a discount code and my affiliate and everything which is great. It's a great way to help out the show. But also you should just help yourself and make sure you get a good hardware wallet. The Bitbox 02 Nova now plugs right into the iPhone and it's just always been one of my go tos. So check it out right down in the show notes. You know, I kind of feel like Melier scam feels quite a bit like Trump's scam. You know the rhetoric. And this is, this is what's interesting is that the rhettic of libertarianism and Austrianism, Austrian economics is becoming a relevant way to get support. And maybe that's the only positive thing to take away from all of this, even though the consequence may be a massive damage to its reputation. But honestly that would be one of our own doing. That would really be the fact that so many of us have let go of our mental faculties and decided that oh, there are really important exceptions to this and that. You know, if we just have someone who massively increases the debt, massively increases inflation, massively increases government spending, doesn't actually hold to any of the critical promises that they said they were going to hold to, and basically don't really have anything to do with Austrian economics, but did one or two things that kind of, on the surface felt like it was beneficial to us and keep spewing the rhetoric that we like. It's like, okay, well, yeah, that's great. He's Austrian president, he's a libertarian president. And it's like, in what sense what meaningfully has been done? Like, all the important things have explicitly gone the opposite way. All the important things. It's kind of like how I think about environmentalism or whatever is there'll be people on the left, total idiotic socialists, just absolute economic retards who think that we should print money and go massively into debt and the government should control everything and control the economy and tell everybody exactly what to do when. Which could not be more universally destructive to everything related to sustainability, to a clean environment. Like, we're talking about mass destruction of environments always. We're talking about the literal definition of unsustainability because sound money is the thing that enforces sustainability. In the absence of information, you could not fundamentally have two ideas that are so different, deeply and systemically opposed as those two things. But then they'll go out and work their butts off to, you know, clean up a river. Some of them, some of them are just posturing morons. And the most difficult thing they've ever done is block a highway so that people can't get to work. But some of them might actually go out and pick up a piece of trash or clean up a river and it's like, oh, that's great. And then they turn around and then support, you know, a policy that's so, so massively and obliterating to the economic sustainability that they've done the equivalent of pollute 50 rivers with just endless amounts of waste and garbage and create poverty that creates waste and garbage, while they think that supporting this massive leviathan of waste and economic destruction is what they need so that they can get their tiny little half pinch of a corner of a subsidy so that they can go out and buy some nets and clean up some trash out of the corner of some river somewhere. That's what that feels like to me. Is it like, okay, well, no new wars, except for like starting a war with Iran for no reason, except for the fact that they're two weeks away from having a nuclear bomb since 50 years ago. And then almost hilariously not getting anywhere with the war, achieving literally none of the stated goals, massively increasing the debt, starting a whole program to basically reveal and, and point out something like 2 or $300 billion in, in literal waste and completely untracked, unaccounted for money that is just dumping into NGOs and all of these fraudulent, corrupt institutions and they're doing more nothing about it and still net increase in government spending across the board. But you know, we got Ross Ulbricht out, right? And I'm not saying that's a bad thing or it's not worth it. I'm just saying why, how could I think that he's anything other than that? Like that's the only good thing that he did. For Christ's sake. They're making deals with Pfizer and the large, the huge pharmaceutical companies to expand their new disasters and get money from the government and get more explicit and directly connected subsidies and government contracts and government laws about what you have to inject into people. They still have immunity from their biggest selling products and they are quietly replacing their biggest selling destructive products with a fundamentally and entirely new structure of the thing which has clearly caused enormous amounts of damage and has horrible, horrible side effects and not even really telling anybody. All from institutions that have been convicted, that have been caught red handed, paying doctors to lie to patients to push drugs without telling them what the side effects are, they have resulted in literally tens, potentially hundreds of thousands of deaths. And then they do their little internal discovery in their, their, oh, we investigated ourselves. And they, they do this little slap on the wrist thing and they say it probably did it, probably two people died and nobody goes to jail for any of it. For anybody who believes the absurdity of the conclusions around what the cost of was from Gabapentin and Bextra, a media, by the way, that gets 80% of its money from pharmaceutical companies that there were only possibly one or two deaths. I want you to understand something. There would never in a million years be a scandal about a drug killing people that gets uncovered and revealed and prosecuted and punished that only resulted in one or two deaths. You would never have a clue that you would never ever be able to connect it to that. If that's all there was by the universal laws of common sense, there must have been tens of thousands for people to even notice and begin investigating. It's so easy to hide something that has a 1 in 5,000 chance of fatality among a large Group of people. Because how many people do you know? How many people do you know? A hundred? 200? And if one of them died from something crazy, how would you ever. How would anyone around them or you be able to conclude or guess that it had something to do with some particular drug? It would have to be bad enough that a single doctor, a single person who knows many patients, a single person who has many friends with some condition taking this drug or prescribing this drug, that it was dense enough of a problem that they noticed that multiple of them were dying. And the only possible way it was that dense is if the numbers were in the thousands. And they were lying. In their clinical studies, all of their trials, they were lying. They were just making shit up. And then they were paying doctors bonuses for telling them to do things that were known to cause problems. And Trump is making deals with these people. This is the exact same thing as Melies making deals with the IMF after coming out, after selling everybody and getting elected on ending the central bank. I'll tell you, I didn't know how bad the numbers were, but I really just kind of quit looking after I found out that the central bank, because there was a whole bunch of show, and this is kind of the same for both cases for Trump and Milie, is there was a huge show right at the beginning, right. There was this. There was this almost wild looking beginning to all of it that made it appear as if something was about to happen. I remember hearing about, you know, like something like 30 or 40% of the people at the central bank being fired. And I admit I got a little bit excited about it. I was like, oh, my God, this. Is this actually a thing? Is this actually happening? But then when it became apparent that he wasn't going to do that, I really just kind of stopped. I was like, oh, of course. And the same thing here. And, you know, specifically a whole bunch of people's like, oh, well, Kamala would have been worse or whatever. When talking about Trump or, you know, somebody other than Melia. And specifically in the context of like the American allegory or the. The American parallel to Milie, which I think Trump is. I'm not saying at all that Kamala would have been better. That's not even slightly. Of course Kamala would have been worse. Kamala would have done nothing. Like she. I don't think she would have done anything. In fact, she would have supported and doubled down on everything that was a problem. We would never have had Doge. We probably would have lost Twitter as A platform. It would have been way worse. We, the crypto 2.0 would have been. Or excuse me, choke point 2.0 would have gone into overdrive. All of it would have been worse with Kamala. But none of that has anything to do with the criticisms of Trump being nothing at all like what Trump promised and the fact that we got. We got the same thing we got. We literally got. The meme is, you know, Democrats just want surveillance, state, endless corruption, endless explosive debts, total government spending and control over everything in the economy. Or you can vote Republican and you can get all of this but slower. That's what we got. We literally got the meme. Except wildly. Milie actually doesn't even hold up for that one. The money supply numbers are wild and you guys are going to freaking love. You are going to love the the community notes, the proposed or suggested community notes on this. I'm going to read this because this is hilarious. This is the community on Safety's piece. By the way, Savedine's piece was a Twitter article and it says missing context. GDP grew 4.4% in 2025. The February 2026 contraction is one cherry picked data point. Argentina had negative 10 billion net reserves when Melie took office. Ecuador had a reserve base when it dollarized in 2000. The two starting conditions were not comparable. So first, GDP grew by 4.4%. This is why I have said a million times on this show, GDP does not mean shit. GDP means nothing. And I'll prove it to you. You have three people in an economy, Alice, Bob and Tom. And you have a bank. Alice has produced a lot of food. Bob has built a house. There's a thousand dollars in the economy and Alice has had it because she's been producing the food all of this time while Bob has been building a house and he hasn't sold it yet. So Alice is going to pay Bob $1,000 to get the house. And what have they done? They have sustainably traded her food for his house and they have literally measured it in the difference between those two commodities or those two services in the economy by her feeding him all that is needed to have a house produced. And GDP is $1,000 because that's how much was spent. Now the bank issues $2,000 out of thin air and gives it to Tom. Tom outbids Alice and gets the house. Alice is still making food. She can't afford a house. Bob is now having to pay more for food because Tom is eating up half of it with the money that was issued to him. And Alice has to go back to work and make more food to Bob and Tom, trying to earn the house that she had already earned. Tom has done nothing to help the economy. No one is legitimately better off. Alice, in fact, is way worse off. She doesn't have a house and she's still having to work to afford one. Bob doesn't have a house and his food is now more expensive, so he's having to work again to get things he has already produced for. And Tom has all the stuff, even though he's contributed nothing to our little economy. But the GDP is like twice as high. You want to know why? Because GDP is a nominal metric. It just measures the dollars. So if you're counterfeiting currency and throwing it at the economy, of course your GDP goes up. So a 4.4% GDP quote, unquote growth when you've increased the money supply, what, 40 or 50% in the same year? He's actually a pretty staggering failure. And specifically, he dumped in a massive amount of new debt coming in from multiple foreign countries and institutions. GDP in this context means nothing, especially out of the context of what's actually happening to the economic system. GDP went up in the US the stock market went up in 2020 when we lost 40% of all small business across this country. Why? Because massive corporations in the financial sector did really, really well. It's just all so tiresome. And I think there's part of me that thinks that this is kind of the bootleggers and Baptists theory. If you've never heard that, is that the only way to actually get anything passed, anything done in government, is to have the moral superiority argument. The Baptist, this was about alcohol, right? Like Prohibition is. You had to have the Baptists who said it's wrong to drink and consume alcohol and be a drunk and alcohol is bad and God is against it and blah, blah, blah. But you also needed the bootleggers. The Baptists aren't going to actually fuel it. The. The Baptists aren't going to pay for all of the money and the subsidies and the connections that get the media on board and the large corporations on board, all the capital and attention needed to actually get a law like that passed. You need the bootleggers too. In other words, you need the corrupt people who are going to profit from it, who are willing to put up the funds to bolster the campaign with the message run by the Baptists. So the Baptists, unknowingly or unwittingly, are actually in cahoots, and their entire endeavor Only works because the worst of those of the alcohol offenders, the bootleggers, who want a monopoly, who want extremely high prices, and they want prohibition because of what it enables them for profit and covert cooperation with political entities, the power and money that it presents them by essentially eliminating all of their quote unquote, legitimate competition. The Baptists are just the boobs that are used to create the moral argument for the corruption. In other words, the only way to get anything good done in government is to allow two bad things to happen in trade. And this I think is the kind of milie and war with Iran with all of these things. Is that okay, who do I have to please to make sure that I can maintain power so that I can control the narrative in order to get this one good thing done? What two bad things do I have to do to appease the people who are going to undermine everything that I want to do and basically hamstring me into being able to do nothing at all? Well, isn't it better to just let go of these not as bad, bad things in order to do this one good thing? But it means that you're just forever walking towards the destruction of the society no matter what you do. This is why increasingly, like, I don't know, I don't know what the solution is. Like you can't vote your way out of this problem because of that problem, because of the bootleggers and Baptists incentive structure. You can't undermine the establishment because you need the establishment to actually, you have to have some cohort of people that are willing to, to put up the funds and put up the energy to keep you in power, to actually support you. Because if the money is against you, you're never going to hold the people because you can't, you can't talk directly to them. You have to talk through all of the other mediums, which means the narrative is going to be controlled by all of the network owners, by all of the journalists, by all of the corporations who, who have the front seat into the consumers or the population's ear? And then also if Congress or your judges, the justice system or whatever, if they're also so corrupt that you specifically can't even get support for anything good, well then how do you do, like if, how do you adhere to the rules and the limitations of government power when government has become too powerful, when it has become so corrupt that the rules simply restrain the ability to fix it and the default is to just slowly creep ever, ever worse and worse until the entire thing collapses? Like, I don't know how you fix that. Like I don't know what you do. And this is why, even though everything about somebody like Bukele seems to stand out as like, no, obviously he, he behaves a lot like a dictator. He has done like insane violations of like the basic principles and the structure of the government. He strong armed their, their congress or whatever it is. He sacked tons of different judges and stuff, but the entire country was run by the cartels. Like I don't know. I can't help but see everything that the HRF has talked about as very proper and very legitimate complaints or understandings of how what he has done has been a terrible thing. But I also can't ignore the results. And I also have no idea how could you possibly play within the rules of a system designed to be hard to change when it is entirely taken over by corrupt, violent criminals. Anything that you do is just going to get handed back over like there's no way to fix it within the system by doing that. Which makes me think you have to be. The only solution is the thing that never happens. The thing that happens once in a thousand years is the Cincinnatus, the Lucius Cincinnatus, the George Washington, the Satoshi. Someone who takes essentially dictatorial power, fixes it, and then voluntarily gives up the power. But that never happens. That never happens. That's why I have three examples. George Washington was offered the position of king and he turned it down. Cincinnatus was made dictator twice in Rome, was given full and total power over emergency powers over everything, won the war, and then gave it all back up and went back to his farm. The second time he did this, which was like 20 years after the first time, the people literally wanted him to stay dictator. They wanted him to become a king. And he still turned it down. But saying that like that's the only real solution is like saying, is like saying that we can solve our transportation problem by like finding enough unicorns or something. It just, it doesn't like literally, you know, our examples are the re one person in the Revolutionary war and then one person in 500 BC. Like if this comes along once every 2300 years, odds aren't really on our side. Especially when the moral character of the people in most countries is so decimated by a fiat culture. Where are you gonna, where are you gonna find them now? It just makes the political side of all this feel so hopeless, feel like such a facade. I don't know what I would do if I didn't feel like Bitcoin still Had the best chance possible of putting a dent into this. I understand why most libertarians, particularly before bitcoin, they had no outlet. They were just hermits, right? They were just hopeless, angry hermits. Like, that was like a common thing. Because it does seem like an insurmountable problem. Like, what do you do. What do you do when your government, your corporations, your media are essentially run by Epstein's clients to the point that no matter who you get in power, their names stay redacted. You're literally not allowed to know who they even are. Are. And they are raping children. And not only does the FBI not prosecute or do anything, despite tons of leaking that there are literally thousands of videos with people that we would know the names of people who are in the government today. And the FBI has even has spent decades protecting Epstein, explicitly protecting him. The media has gone out of their way to protect him, to shut down all reports and investigations, to hide court cases from the public. All of our government and establishment institutions have literally been running defense for that guy for decades. What do you do about that? How do you solve that problem when it's so. When the corruption and the evil is so entrenched that it operates on it? It's literally like a blood poison that the only way to actually get it out, you have to remove all of the blood from the organism, but it literally kills the organism. So what do you, like, how do you. You get a transfusion. You take a. You take a government that's not total shit from somewhere, and you. You just, like, sit them in charge. You just, like. We're gonna place you into all of these positions temporarily, but how do you do that without being a dictator? Like, what do you, like, seriously? It's literally like, you have to let it run its course. And the only thing that you can do is try to protect you and your family from being left holding the bag. You have to just exit. But they're going to attack you for exiting. They're going to literally attack. The cancer is literally going to go after the healthy cells and hang them by the neck for the crime of not feeding the cancer. The study of history is a wild thing because nations literally do act like organisms, and they get sick. Collectively, they go insane. Collectively, they heal. Collectively. There's this weird ebb and flow of civilization, and it's kind of a question as to, like, what do we do? And do we fight the tide? Do we. Do we fight the ocean? Or do we just try to notch out our little corner of sanity in a world Going insane just to, just to wait out the storm. And if the storm lasts two generations, you know, I don't know. Without bitcoin, I would be. Bitcoin is the only thing that feels like it actually has a chance. And even the apparent cultural shift and the apparent value and popularity, growing popularity of the kind of like Austrian and libertarian rhetoric, it seems to have produced nothing of consequence. In fact, it may have produced fuel. It just produced just enough fuel to swing back in the other direction more. Granted, there is such a massive counterculture. There's. There's an enormous amount of those who supported Trump that do seem to have their head on their shoulders and recognize where he has failed miserably. And same with Melie. But I'm surprised. The Mises Institute of all like, man, the Mises Institute has been great. And to cut ties with Hans Hermann Hoppe, like, come on. And I second. Sefed's thoughts here is like, explain, explain how was it quadrupling the money supply and raising the debt, keeping the central bank there, keeping the total monopoly over banking licenses and the banking system, borrowing more from the IMF and foreign governments just to have this thin facade of slightly increased GDP at the same time that you've ballooned the debt and like so many countries are becoming, becoming a society where the only thing you can do is speculate against. The only profitable thing to do is speculate against the currency. How is that? Like, what's the, what's the defense of that? Why is that a positive thing? But anyway, get yourself a bitbox. Hold your own keys. If you're not holding your own keys, you're going to be in a mess. I don't. I would not risk. I don't. There's no, there is no sense of political stability in anything. If somebody else is holding your keys, you better be worried. There'd be a. Better be a pit in your stomach until you get those keys back in your possession. And if you don't have a hardware wallet yet, bitbox is a great one, is a fantastic way to actually hold your own keys for the first time. Discount code, affiliate, all that good stuff. Curious. What yalls thoughts on it? What is the argument? Like I said, I haven't kept up with Milie very much. After I realized he wasn't gonna shut down the central bank, I just kind of washed my hands of it. And I was like, well, that was a fun show. We got a bunch of great quotes out of them. At least I'm curious. Your counter, you know, what do you think about this do you agree with it? Is there something else that you can point at that says it's better for some reason, or is it just, oh, the other guy would have been worse? It's like, well, that's the. Isn't that the never ending siren song of government? It would have been so much worse if we hadn't done this. Yeah, good one, guys. Anyway, I guess that's my two sets. Catch you on the next one. I wish the ring had never come to me. I wish none of this had ever happened. So do all who live to see such times, but that is not for them to decide. All we have to decide is what to do with the time that is given to us. JRR Tolkien.