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Kibbe on Liberty
Ep 390 | Bitcoin Is Here to Stay | Guest: Saifedean Ammous
01:07:33
Matt Kibbe is joined by author and economist Saifedean Ammous, the man responsible for interesting Rep. Thomas Massie (R-Ky.) in Bitcoin, to discuss the future of cryptocurrency and its applications for building a better, freer world.
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- [00:00]
A
Welcome to Kibbe on Liberty. I'm talking to Sefedine Amus, who is the author of the Bitcoin Standard, the book, by the way, that turned on Thomas Massie to the philosophy and the potential of bitcoin. And yes, we're going to talk about bitcoin. We're going to talk about fiat currency. We're going to talk about the relationship between fiat currency and endless wars and how bitcoin is going to save the world from those bastards. Check it out. Welcome to kibby on liberty. Safe. It's really, really an honor to meet you sort of in person for the first time. I've been a fan of your work and we finally get to talk.
- [01:10]
B
Thank you, Matt. Likewise. It's a pleasure to talk to you.
- [01:12]
A
Yeah. And I definitely want to get into your history and how you discovered economics. And you're essentially the one person I know of who has one foot solidly both in the bitcoin community and Austrian economics. And those two things are quite simpatico. But most people I know are either Austrians or bitcoiners, and you're kind of both. So that, to me, is quite interesting. But current events, I was listening to the show that you did with my favorite congressman, Thomas Massie, in preparation for this conversation, and I was thinking, this actually turns out to be the very first episode I've done since Thomas lost his primary a week and a half ago, whenever that was. And I had stored up three shows or so so that I could actually go down to Kentucky and help Thomas volunteer for Thomas and fight that fight. So I spent some time, lot of time in the District, and I've written about it. But it's interesting to me that one of the few guys in Congress that actually gets the importance of sound money, specifically both bitcoin and how the Federal Reserve corrupts the dollars in our wallet, and also is consistently against forever wars. And I would just start this conversation by saying, having focused a lot on fiscal policy and regulatory policy and trying to get the government from not spending money it doesn't have, it's now sort of dawned on me that the only two issues that matter are sound money and stopping endless wars. And that's kind of a chicken and an egg thing for me, because you can't have forever wars without fiat currency. And you probably don't need to print all that money if you're not having forever wars. So it strikes me that your portfolio is quite similar to that.
- [03:25]
B
Absolutely. And I would say the chicken and egg problem is the causality runs both Ways Fiat was born out of the First World War. War is the midwife of fiat money, because it's the idea that we. We are in a crisis. We need desperate measures. Desperate times call for desperate measures. And so, you know, you see this every time there's a crisis. People are very happy to cheer on the money printer. And I think the. The World War I was the first time that happened at a massive global scale. And since then, governments got the taste of fiat money, and they have just not let that printer go since then. And I don't think you can separate the war. Fiat makes war possible, and war makes fiat possible.
- [04:15]
A
Yeah, I was trying to find it, and it doesn't exist online yet. I wrote a paper when I was in graduate school at George Mason about the founding of the Federal Reserve and the financing of World War I, and specifically the role of Benjamin Strong, a famous Fed chairman who created new financial means to expand fractional reserve banking, which was basically an early form of inflation. So it's something I've thought about my entire life. But having spent most of my time trying to produce better political outcomes and try to educate grassroots Americans about the principles of economics and the basic values of libertarian philosophy, I've now settled on this idea that we have to turn people on to this chicken and egg problem. The reason I was thinking about it is because I feel like in a lot of ways, that's kind of how Thomas Massie ran that campaign. I don't know if you looked at the numbers, but Thomas crushed it with people under 55. A closed system because it's a closed Republican primary. And he lost boomers, particularly those over 70, by some exponential number.
- [05:41]
B
He lost the hospice vote, let's call it.
- [05:43]
A
Yes, exactly.
- [05:46]
B
Which won't be around for many more elections, fortunately. Yeah, it's morbid to say that, but you know better than millions of innocent people.
- [05:55]
A
Yes. And like, I had this conversation with Ron Paul not too long ago, and he's still sort of fascinated by the fact that end the Fed became a politically salient chant at his rallies. But again, that's young people. So I think I'm optimistic about these two things, even though at the moment, there's very little reason to be optimistic about convincing Americans that endless war is a bad thing. But I think. I think it's a generational divide.
- [06:28]
B
Yeah, absolutely. I think people who grew up with TV and extensive government propaganda are just very difficult to reach. They are just. I mean, it's incredible. You see it with the Iran war, like, a couple of years ago, A lot of these people were very on the same page when it comes to wars. You know, we want to vote for Trump. We don't want to vote for neocons. We don't want to vote for those Democrats. They just want to keep sending our money abroad and creating conflict and war all over the world. We want Trump. He's the business candidate. He's going to make money. And now, you know, as soon as a little bit of jingoism is on TV and you've got clowns like Hexeth and Rubio fanning the flames, then everybody just suspends their critical thinking and they just become monkeys cheering for their team.
- [07:17]
A
So what's your, what's your explanation for Trump's kind of shocking 180, not so much on Israel, but on forever war? Because you can go back not that long ago, and you can certainly go back over the last 10 years and find Trump making the most persuasive arguments about the war crimes of the war in Iraq and how getting into war with Iran would be the stupidest thing that a president could do and that Rubio would do it. And, you know, Miriam Adelson is going to fund Marco Rubio and, and get us into another endless war and flipped a switch and now he's the opposite guy. What's your theory as to what happened?
- [08:02]
B
I mean, I don't really know the intricacies of whether he changed his mind or whether he was lying. But the bottom line is he's an Israeli agent. There's no nice way of putting it. I guess that is the nicer way of putting it. You could say, you could use other ruder terms, but he just works for Israel and he's corrupt. He, he's gotten plenty of money from Miriam Adelson. He's running plenty of corrupt operations on the side. And it's pretty clear that this was part of the deal for getting him elected. You know, he very clearly played the anti war voice to win the Republican base, win the Christian vote, win the vote of fiscal responsible people, libertarians, this broad coalition of people who thought that this was a change from Biden and from Obama and from the Clintons and from the Bushes. You know, the idea that he was a businessman, he's not from the establishment, he hadn't spent his life in Washington, D.C. there is a certain appeal to it, but, you know, fell for it again award. There's always a new guy. You know, people thought Obama was going to be that way. He's black, he's obviously going to be different from the establishment. And then look how that worked out. And Hillary was supposed to be that. And if she had gotten into power, she would have been no different. I think politics is a lot of stupid theater, and ultimately powerful interests get what they want, and then people get to fight over which clown they have at the helm.
- [09:35]
A
Yeah. And goes back to my thesis that this is a elite class of people that aren't really Republicans or Democrats, but they certainly feed off of the closed nature of the banking system and how inflation enriches some people at the expense of everybody else. And again, the war machine is very profitable, and these two things go together. And we've sort of come to the conclusion that we're not going to vote our way out of this, and it's going to have to be at the grassroots level that people wake up to what's going on.
- [10:12]
B
Yeah, I mean, it's tempting to keep voting, and I think maybe I am just setting myself up for falling for it again. But I think there has been a massive change over the last couple of years. I just, you know, even though Massey lost, you know, the. The sentiment is completely shifted among young people is very different. The boomers are just going to get older and less significant politically over time. And people who are not demented and senile can exactly see exactly what's going on. They realize there absolutely is nothing for the US to gain from taking part in all of this slaughter. And in fact, it's only the fact that the US Is part of this conflict that makes it so intractable. It's what allows the Israelis to be so completely unreasonable, so completely expansionist, maximalist. They can keep doing all of that because the US Is always there to pick up the tab. It's giving them the weapons, and it means that they never have to. They never have to make any concessions to anybody. They want to take the entire west bank, and, you know, they're doing it and they're murdering everybody in Gaza, starving people, kicking people out of the west bank, taking one plot of land at a time. They just keep confiscating more and more land, kicking more and more people off of their homes, and it's just. It's. It's. It would be completely unacceptable anywhere except in this situation where it's somehow acceptable. And the Americans are constantly subsidizing it and paying for it, and it's absolutely criminal. I think Americans are changing in that regard. If you look at Twitter, you know, APAC is just constantly getting absolutely brutalized and ratioed. The pro Israel influencers are just absolutely, shamelessly lying all the time and getting completely shat upon by anybody with a brain. I mean, you know, I've never seen anything like it. You're getting, you know, senators who have like a million followers making stupid retarded tweets about stand with Israel or whatever, and they get like 50 likes and then track APAC responds to them with, you've taken this much money, you cheap prostitute, and that gets 50,000 likes to respond to it. Seen anything like it? It's just the most. The most reliable formula of getting humiliated on Twitter is to just go ahead and say something that is pro Israel, even though very clearly the algorithm is so, so, so clearly favoring Israel. Elon Musk himself is out there pushing all the pro Israel accounts all the time. He's always pushing all of their propaganda. The algorithm are clearly pushing them, and it's not working. People just get it. People realize it's deeply criminal what is happening, and people don't want to pay for it.
- [12:56]
A
The political noise machine is loud and slop is more prevalent than ever. Cutting through the bull takes more than opinions. It takes data. That's why I'm fired up about Free the people's launch of the Words and Numbers podcast. Anthony Davies and James Harrigan are two PhDs, an economist and a political scientist who don't care about the feelings of the political parties. They only care about the truth. Every Thursday, they break down the numbers behind the headlines and leave you genuinely smarter. Find the latest episodes@freethepeople.org on social media, Re the people, or anywhere you listen to podcasts. Stay free out there. I definitely want to spend a full hour on this conversation because you wrote a really interesting piece, I guess about six months ago I watched the YouTube version of this, where you read some of the papers that you write about a sort of Austrian property rights, Rothbardian analysis of the Israeli Palestine conflict. And I'd love to dig into that because it's a really substantive, interesting take. And I told you before we started, I had some of my Israeli friends, Israeli libertarians, on that would obviously have a very different perspective than you as someone that was born in Palestine. And I think that's worth digging into. And that'll probably be the show that gets me canceled from YouTube, but we'll see what we can do there, if you're up for it.
- [14:26]
B
Yeah, definitely.
- [14:28]
A
But as if my audience doesn't know your work, I want to start by introducing you as the guy that really. You certainly weren't the first person to talk to Thomas Massie about Bitcoin. And he's an MIT trained engineer, and he certainly understands the technology. And as a Ron Paul guy, he certainly understood the corrupting nature of the Federal Reserve. But he claims that he listened to your book, the Bitcoin Standard, and it really sort of turned him on and made him a far more energized advocate of a lot of policies, including reintroducing Ron Paul's bill to end the Federal Reserve. So that's sort of. My audience knows Thomas and loves him, and that's the gateway to a lot of your work, if they don't know you.
- [15:21]
B
Yes, I'm very happy about that. Very happy to have influenced Thomas. I'm a huge fan of Thomas. I had him on my show. I think he's a great man. And I think it is. It's a compliment to him that he was not elected. It's a compliment that. I mean, you had an entire nation state that essentially runs the US Running all of its operatives. You know, every single prostitute that they have in the US Went out of their way to spend all of the last few months doing nothing but slinging shit at Thomas Massie. Everybody from the chief prostitute in the White House, the orange baboon, all the way down to, you know, the Laura Loomer retards on Twitter. They were all nothing except nasty. And they spent tens of millions of dollars, the ones that we know about, and I'm sure they spent a lot more behind the scenes. They got ex girlfriends to come and say ridiculous dirt about him. I think it's very, very telling. Even though he lost, I think, first of all, it's. He can. He should be proud of himself. And I think I. I doubt they are able to. They'll be able to continue to do this with every seat because it's just becoming more and more and more difficult, both on the left and on the right. It's just Israel is so toxic because of, I, I believe of smartphones, is because Palestinians are really able to document what is going on, which has never been possible before. And there's just no way that you can defend it. There's no way that you are a decent human being and you support Israel and I. There is no way you're either a fucking moron who is completely clueless or you are a bloodthirsty animal. And there are no other choices. There is no choice that you're a decent human being and you support a government that's out there murdering people for belonging to the wrong race, taking their Land for belonging to the wrong race, people putting them under military occupation for 60 years, putting them in tortures, dungeons, raping them, doing all kinds of horrific things completely without any accountability to anybody. If you support that, you are a piece of shit. There's no way around it.
- [17:16]
A
So you said something on Twitter a couple days ago, Steve Vassant, the Treasury Secretary, announced that the US had seized some billion worth of Iranian. And the definition of what they had seized, wasn't that clear to me? Iranian cryptocurrency. And you said two things. One, that's not seizing, that's theft, and more importantly, that's not Bitcoin. And this seems like a good launching off part to get into why you're such a bitcoin maximalist. But what is your understanding of what happened and why wasn't it Bitcoin?
- [18:01]
B
Well, specifically with dollars, with treasury bonds, and with usdt, with most cryptocurrencies the distinction is that these things can be confiscated from the comfort of a Washington D.C. office. So Scott Besant just writes an email or picks up the phone and people can just confiscate this. If they figure out this is a wallet that belongs to the Iranians or somebody they don't like, they could confiscate if it's any of the other shitcoins, if it's usdt. But with Bitcoin they can't do that. Bitcoin's. Bitcoin's network is completely immune to this kind of pressure. So that's why I think, that's why I think it's more likely that more and more people are going to wake up to this and realize the value proposition. I think the Iranians are beginning to understand it and realize it now. They probably had a lot of money confiscated in the form of usdt. So they see the value proposition from Bitcoin. But I have to say this is, this is really a small part of the value proposition of bitcoin. The reason that I'm really interested in bitcoin is because it kills inflation. That's the key thing. So I was into Austrian economics and hard money and sound money and ending the wars way before I heard about bitcoin. Well, not way before, but a few years before. And that's really the key thing for me. It's just the idea that finally we can have a form of money that governments cannot inflate, which means that, that your money is not being devalued in order to finance what governments want to do. You just get to keep your own money. And you do with it what you want. And this is massively transformative on an individual level because now you get to keep the fruits of your labor. But perhaps more importantly, it's massively transformative on a societal level because it takes away from government the power that keeps them going. It's the 20th century, was the century of fiat money. And it was a century in which governments can print money, which essentially means they are at all times taking purchasing power away from everybody who uses their shitcoins and appropriating it and then using it to do all kinds of crazy things that they do. And of course, all of our understanding of economics, all of the textbooks in universities, they are all. The best way to understand them is that they are all just rationalization for that theft. It's actually being done for your own good. We're doing this because it's going to help us make better something or the other. It's, it's going to make us have better hospitals, it's going to make us kill more foreigners. It's going to allow us to do all of the nice things that you want. We're going to give free people free health care. This is the can't if you want. This is the fake excuse that is usually used to justify this. But in reality it just means that the government is constantly printing money, constantly taking your wealth. So they dangle. The temptation of government is going to give you everything for free, just give them the money printer. But in reality they're just taking your wealth. And you see prices rising at all time and you're programmed to think that it can be anything that is causing the prices to rise except for the increase in the money supply. I remember a few years ago in 2011 when there was a inflation spike after Covid 2011, 2022, there was a huge increase in prices and it was incredible. Every day you'd open the newspaper and there would be a news story about o prices are up because of the weather or prices are up because of Beyonce's tour is driving prices up. And everybody's crazy because of Beyonce. And then there was one about Taylor Swift, there was one about wages, there was one about climate change. And my definition of a fiat economist, as I call it, is somebody who believes that absolutely anything can cause prices to rise except for an increase in the money supply. It's just everything causes prices to rise except for an increase in the money supply. But in reality, the only thing that causes prices, prices to rise across the board is an increase in the money supply. Beyond Say weather, natural disasters, all of those things, they can cause prices of specific things to go up, but that must come at the expense of other things. If everybody's spending money on Beyonce's tickets or on, you know, disaster relief, or everybody wants to buy oranges for whatever reason, yeah, the prices of those things will go up, but that means they have less money to spend on other things. So the prices of other things will have to go down. But if the price of everything goes up at the same time, then the answer, then the reason is that it is the money supply that is increasing. It's not so much that prices are going up, it's that the money's value is declining. That's ultimately what I think is the key thing.
- [22:29]
A
Thank you, by the way, for schooling, gently schooling Lex Friedman. That was quite a while ago, maybe four or five years ago, on the basics of Austrian economics. And we talk about the Austrian perspective here. How did you discover Austrian stuff? Because it wasn't in graduate school, was it?
- [22:50]
B
No, not really. I did my master's at the London School of Economics. And I remember there I came across one paper by Hayek, the Use of Knowledge in Society. And I read it and I thought it was interesting, but it didn't leave much of an impression. I was still, I considered myself a, you know, a scientific economist who was above ideology at that time. But I was just your run of the mill, center left, basic, basically. And then, then at Columbia, you know, I had three, four years of, again, center left, mainstream neoclassical economics. And then towards my third year, I started, it was, I think, you know, I was first, I started off with Karl Popper, and I thought that was interesting. That led me down to Hayek. And then I came across Hayek, started reading Hayek, which I thought was very interesting. And it was very relevant to my PhD at that time because it was all about applying the tools of science into questions of social science. And that was what I was doing. And then I came across Hayek and I realized, okay, I'm an idiot, this doesn't make sense. And there was a sense of, oh, wow, I've uncovered this hidden secret wisdom, and I'm sure my committee are going to be excited to find out that everything that they've been doing all of their life is completely worthless and they're obviously going to be very happy with me. Turns out they weren't. Turns out there are careers and paychecks involved and so intellectual debates become secondary to these considerations. So it wasn't the smoothest process to finish my PhD from then on. But on the one hand, I had to revise my PhD to make it a little less controversial and a little less heretic. But on the other hand, after reading Hayek, I then heard about the Mises Institute and discovered the Mises Institute and discovered their endless trove of free PDFs. And I remember just spending so much time during my graduate school, my last two years in graduate school, reading Mises and Rothbard. No, particularly the last year. Really, it was the last year. 2008, 2009, and that was during the financial crisis. So I was in New York, I was at Columbia University, and down the street, the world of finance was imploding. And at my university, everybody was just telling us how, you know, listen to the tv, and basically all of the economics that we were learning was just to nod along when Paulson comes along and says, yeah, we need to print $17 trillion to hand over to people. We were all supposed to just nod and say, wow, that is so powerful. They are so wise, they are acting strongly. They are being the decisive leadership that was needed. And that was what everybody was basically repeating at that time. But I had discovered Mises and Rothbard, and so it was a very, very different perspective. So then I finished up my PhD. I was delayed a little bit. I had to rewrite some things, but I finished it. And then I went to a teaching job in Lebanon, where I was teaching at the Lebanese American University. And while I was teaching there, you know, I decided, all right, I'm going to get a teaching job, because that's the best paycheck that I can get at this stage in my life. But. And so I did my job. I was teaching basic Keynesian economics, and I did the job really well. But then in my spare time, which, you know, for professors, there's a lot of spare time. They like to pretend they're very busy, but they're really not. It takes very little time to do their job. There was a lot of spare time for me, and I spent all reading Australian economics, then came across bitcoin. Unfortunately, I was extremely, extremely stupid when I first came across bitcoin. I had the kind of stupidity that you can only get from a PhD where you can confidently assert that something can't work without you needing to actually dig into it and try and understand what's really going on. You know, I have a PhD in economics from Columbia University, obviously, let me explain to you why this bitcoin thing won't work. And I don't even need to read about this bitcoin thing. So I heard about bitcoin very early. I think it was 2011 or something like that. I remember 2011. I heard about it when it hit $1, and I remember thinking to myself, you know, I should probably buy 100 bitcoins for 100 bucks, and then we'll see what happens. And I thought to myself, I remember summer of 2011, I was going to go to New York, and I thought, all right, I'm going to go buy 100 bitcoins in new York when I get there. I went to New York, spent a lot of money on a lot of stupid things. Didn't buy the $100 of Bitcoin because I think by the time I got to New York, it was like 10 or 12. So I thought, that's ridiculous. I'm not going to buy $12 for Bitcoin. I got to pay $12 for Bitcoin. So forgot about it and then assumed that it was going to die, assumed the government was going to shut it down, but it didn't die. And then by 2013, 2014 is when I started to look into it, and that's when I started saying, oh, okay, well, this thing might actually work. So I started buying a little bit, but again, not enough. Didn't really put into it a lot of effort. Only in 2016 and 17 is when I really began to study it properly. In 2017 is when I started to write bitcoin Standard. And the turning point really was one day I was. I was on Facebook arguing with some friends and writing these endless essays, arguments with friends. And I remember my wife walked in and she said, my God, she saw the wall of text that I had been typing, and she just looked at me and said, my God, I can't believe how much time you're wasting on Facebook. You could be writing a book. And I just remember looking at her and thinking, oh, my God, she's right. And then I took a vow. No more arguing on Facebook. No more commenting on anything on Facebook. If I'm going to comment on Facebook, it's just going to be congratulations or condolences or something like that. You know, one sentence, comments. That's it. No more arguments, people. Let my friends be wrong. Let them stay poor. Let them say all the things that they want to say about bitcoin. I'm just going to write a book. And I sat down and put all of the ideas about Austrian economics that I had been bottling up for 10 years. I had a lot of things that I was writing that I Wasn't publishing that. It was just me helping myself think about things by writing them down. And then I put all of that together and built it into a book that became the Bitcoin standard and published that. And then it did really well. Started getting translated into many languages, started selling a lot. And then I decided at some point, okay, I'm going to quit my university job. I want to focus on doing this thing full time. So I quit the university job. I started writing other books. I wrote Principles of Economics, which I'd wanted to write for a long time. I wanted to write the Austrian book, you know, the full Austrian economic take in an easy, accessible, engaging way, which is what I would have wanted to teach when I was a university professor. So I wrote that, I wrote the Fiat standard and started teaching courses online, did my podcast, and here I am. And I'm on Twitter all day. Shit posting.
- [29:34]
A
Thank you for joining me today on Kibbe on Liberty and for being part of our fiercely independent audience. Every week my organization, Free the People, partners with Blaze Table to bring you this show. My guests bring smart perspectives on everything from current events to timeless philosophical debates. If you like what you hear, go to freethepeople.org kol and support Kibbe on Liberty so we can continue to produce these honest conversations with interesting people. Now, let's get back to it. I'm working on this project called Austrian Economics and Popular Culture. And you're a good example of, you're kind of on the cusp because you discovered Hayek the old fashioned way. You read an article, you picked up a book, but you really didn't get fully turned on to Austrian economics. But for technology and the Internet, which is different than the days when Hayek would lecture and Mises would lecture and Ron Paul talks about the early days. Ron Paul's been talking about the same stuff since he was a young man, particularly after he got elected to Congress. But you know, he used to attract dozens of people and suddenly technology democratized knowledge and it liberated people from their PhD professors and corporate newspapers. So it's an explosion that I think is creating a lot of anxiety amongst our would be overlords. But, but to me it's, it's the one place I can get really white pilled.
- [31:10]
B
Yeah, I agree. I mean I, I was very much an Austrian before Bitcoin, but there's a, there's an entirely different way of looking at the world. Once you see Bitcoin as a technology that works and you stop thinking of it as just a stupid game for nerds on the Internet. Once you understand that this is an actual technology that can perform the functions of money and it can perform them better than anything else, then you start thinking to yourself, okay, all of this Austrian stuff is no longer reliant on having to convince people we can just have our Bitcoin and we're free from inflation. And then the more people join, the more powerful Bitcoin is, the weaker the government is. And that's basically what's been happening for me. It's just, we're a conspiracy. Bitcoin is a conspiracy. It's out in the open. It's a conspiracy to make you free and rich, and your only option is to join Coin. And we are going according to plan. It's been going up in value for 17 years. And that's it. You know, there's only one metric to measure the success of this. There's only one scoreboard. How big is the bitcoin market cap compared to other forms of money? And currently it's still very small, but it's growing faster than anything has ever grown in history. It's up from zero to almost 2 trillion in, or maybe 1.7 trillion in just 16 years or so. So nothing has ever grown that fast. And I think it's to continue for a few more years, for many years. And it's just going to keep going up and it's just going to become the world's biggest money. And when it is the world's biggest money, that means it is the world's money. That means it displaces the other monies and it takes away government's ability to create money.
- [32:55]
A
So you, of course, know this interview, but Frederick Hayek, when he had published his book the Denationalization of Money, was asked about how to fix the system. And I forget the question specifically, but it was like, can you end the Fed? Can you abolish central banking? He's kind of pessimistic about it. He's like, I think it would be impossible to do that because the entire system is built around central banking and all of these very important interests. That's how they get rich. And we needed some sort of sneaky way to get around it and all sly, roundabout ways. Sly, roundabout way, yeah.
- [33:41]
B
And he wrote this in 1984, a long time before bitcoin was invented. And it's truly striking to see him think of it this way, because before bitcoin, I had not even considered that. I just always thought, it's going to have to be gold. It's Going to have to be gold. There's no alternative. We have to get back to gold. But Hayek had this kind of foresight where he thought to himself, no, no, gold's not going to work. We need to invent something by some sly, roundabout way. Invent something which they cannot stop. And I think it's an incredible mental capacity to be able to imagine things out of the ordinary which the vast majority of us don't have. We're stuck in looking at the world as it is. But people like Hayek and Satoshi Nakamoto had the idea of inventing it. So, and, and it's honestly, it's, it's one of those things that kind of makes me feel pretty stupid because I was, you know, I spent years bitching and moaning about inflation and talking to people and getting angry and shouting and telling people to end the Fed. Then, you know, all of it is great points, but some guy called with a pseudonym, sat somewhere and he did something about it and he coded something about it. And it's just so much more powerful of a critique when you build something that's an alternative. And I think Hayek had hit on
- [35:02]
A
that as well and to the point about seizing shitcoins based on top down systems. You're wildly optimistic about the inevitability of Bitcoin and the ability of people to basically work around inflation and all the corruptions that come with it.
- [35:25]
B
Well, yeah, I mean, yeah, you could say wildly optimistic. But I just think ultimately the argument that I make in my book, and I think the really powerful aspect of it is that my book is not so much advocacy. It's not there to tell you please buy bitcoin so that we can kill the Fed. That was what we used to do with gold. You're trying to convince everybody, if everybody buys gold, then gold becomes money. It's difficult with gold because you can't move gold around. It's very heavy and expensive to move it around. It's not easy. And it's all centralized and governments don't allow you to have banks that run on gold. So there are insurmountable objects to the monetization of gold. But with Bitcoin I think it's very different because it's really optimized as an engineering product to solve for these problems, particularly not being centralized so that governments can control it. Governments won't be able to change the supply. Governments aren't able to censor transactions. So everybody can use it. Anybody can use it. Anybody can send enormous quantities of wealth across thousands of kilometers, completely permissionless. And that just completely changes the game. Plus, on the other hand, I think this is the really powerful aspect of bitcoin's design, is that because it was all fixed supply, there's only 21 million. You've created this race, this really game of musical chairs where you only have 21 million chairs and you've got 8 billion people and everybody wants to get their hands on one of those chairs. And so you're making it clear that the supply cannot increase. So then it becomes clear to smart people that if you get in early, you're going to benefit because likely more people are going to come in. So it creates a sort of reverse bank run, the opposite of a bank run. In a bank run, everybody wants to get out because they realize the bank is going to collapse. And this is the opposite. Everybody wants to get in because they realize it's going to go up, which becomes a self fulfilling prophecy, as Satoshi Nakamoto said. And this is what makes it really powerful. So my intellectual and moral case for bitcoin is extremely detailed and well put, I would say, if I may say so myself in my books. You know, I explain the argument why it's bad, why inflation's bad, the damage that inflation does, does to society, the destruction of savings, the cultural effects of inflation, the rising time preference, the short termism, all of these things. The government, totalitarianism, war. There's a really strong intellectual case against fiat and for bitcoin. But ultimately that's not what bitcoin is going to win. And if bitcoin had to rely on that to win, then it won't. Because if it could win based on that, then gold would have won. But ultimately the reason bitcoin is going to win is what I like to call number go up. That's really it. I mean that somebody used this as a slur to kind of mock my work, that all of these bitcoiners, all they care about is number go up. And I thought it was absolute genius because, you know, the three word memes is just a great way of getting a catchy idea into people's heads. And this is what it is. I'm not asking people to buy bitcoin because, you know, buy it so that we put the welfare and warfare state out of business. Buy it so that we could put the politicians out of business. That's going to happen anyway. But I want you to. But you want to buy it because it's going to make you rich. It's going to stop you from Being poor, that's the best thing about it. It's, it, it's not trying to argue with you. It's in your self interest. So if you don't enjoy poverty, if you don't want your kids to be poor, you want to buy Bitcoin, and that's it. That's just so powerful and so much better. And it's just such a superior form of technology in such a superior form of money as a technology that really makes it extremely compelling. And I think it's going to continue to work in that way. It's going to continue to be more and more, more and more profitable for people to get into it. And more and more people are going to realize it. And I think it's just going to continue to go up and there's nothing anybody can do about that.
- [39:33]
A
And the more that speak from an American perspective, but from the more that our politics falls apart and we keep spending trillions and trillions of dollars that we don't have, and the cost of groceries are so noticeably more expensive, normal folks are asking not only what's going on, but what can I do about it? So it's a, it's a window of opportunity to explain the philosophy as well as the fact that if you buy bitcoin, it always goes up. And over any reasonable period of time, it's a safer place to have a store of value.
- [40:18]
B
Absolutely. People can learn this the smart way, which is through thinking about the logical implications of a fixed supply, or they can learn it the hard way while watching their wealth disappear. And that's what happened in Lebanon. I used to live in Lebanon. And you know, the period leading up to inflation, I tell my friends and my colleagues, I was a university professor, I tell my economist colleagues, you know, the 21 million, there's no inflation. Bankrupt, the war machine. Buy Bitcoin. And they'd look at me and say, but it doesn't have a central bank to guarantee it and it doesn't even pay interest. And then look what happened. Their central bank blew up, their currency blew up, their bank accounts blew up. They were making 12, 14, 15% interests on their deposits. That was all wiped out. Didn't help having the central bank behind it backing it up is a liability. Actually, it's not. It's not an advantage. So the, their bank accounts are down 99 since then, and Bitcoin is up what, 20x, maybe 100x depending on when I spoke to them about it. And you can learn that lesson the easy way or the hard way. I Think it's just going to continue to happen. There's not going to be more than 21 million Bitcoin every year. The supply now currently is going up at about 0.8% per year and then it's going to be 0.4% or something like that. Whereas with the national currencies it's about 7, 8% per year in the best cases. But sometimes it's 10 and 15 and 20 and 30%. So over time, there's just no way that there's no other way this can go. It's just going to be a lot more dollars, a lot more euros, a lot more yens and only 21 million Bitcoin. So that in turn is going to drive more and more people to increase the demand on bitcoin and it's just a cycle that's going to continue to self reinforce and that's what we've been seeing in the last 17 years and it's going to continue.
- [42:16]
A
At Kibbe on Liberty. Freedom is a lifestyle24.7 Something you live and breathe and wear every. If that describes you, you need the very best liberty swag in the market today, just like this shirt I happen to be wearing. Go to freethepeople.org kol and check out our exciting merch. You too can love liberty and look cool. So you do this well, you're such a great explainer of complex Austrian ideas and you do this with some of your sort of online classes, if I could call them that. But explain to people the link between the Austrian understanding of the evolution of money and why it really makes sense to bitcoiners that probably didn't read Mises or Hayek because it's different than. Than classical economics.
- [43:19]
B
Yeah, I think I've done a couple of talks about this on the link between bitcoin and Austrian economics and I think it's a very powerful relationship. And I think bitcoin has done more to spread Austrian economics than pretty much anything. I think it's incredible. There's probably a larger number of people that got into Austrian economics because of bitcoin than everything else combined. You know, with all due respect to Ron Paul, I just think bitcoin is so compelling of a value proposition that people get into it and then it changes their life financially and then they want to learn about it and then they see, look, it works. So it is an illustration that everything we learned at university is wrong. It's, I think, a lot more compelling than just somebody trying to convince you because it's actually a Living refutation of the ideas that you learn in university economics. The first and most important, perhaps, idea that Bitcoin explodes is the idea that the money supply needs to increase. And this is just a fundamental tenet of modern economics. If you go into university, if you read academic journals, there's never a question of why should the money supply increase? The money supply is going to increase, but the question is how much should it increase and how should we increase it, and who should be responsible for it, and who decides how much we increase it? So all of these things are taking place, all of this academic work is being issued under the pretense that under the pretext that the money supply is going to be increasing and we need to figure out how to manage it. And it almost goes without saying that, you know, you can't have a fixed money supply. And rarely does anybody ever stop to ask that question. When you do, they'll tell you, oh, that would be terrible. If we had a fixed money supply, it would be terrible, because what if, you know, money supply is fixed? Then prices would drop, Things would become more affordable, and can you imagine the horror? You know, people would be able to afford things. And then if people afford things, if people can pay for things, and if they. People expect that their money is going to have more purchasing power in the future, then they're not going to consume anything in the present. And then if they don't consume anything in the present, then the economy will come to a screeching halt and we will all starve because we're all waiting for the money's value to go up before we spend our money, and then we all die. I'm exaggerating it, but only a little bit. It's. It's really. Is that stupid? And of course, what's really stupid about it is the Keynesian perception of why people consume is people consume because the value of their money is going to decline, which is very stupid. People don't consume because they think the value of their money is declining. People consume primarily because they need to consume. You want to eat, you want a roof over your head, you want clothes on your body. You'd like to have a car today, and you want to buy a laptop, you need it. You want to buy a smartphone, you know that the same smartphone that you're buying today for a thousand bucks, you could wait three years and you get the same thing for maybe 200 bucks or 100 bucks, but you still buy it today even though you know the price is going to decline. Why? Because you need it today because you want to make the phone calls today, you want to surf the Internet and see the cat videos today. And waiting three years is not the same thing. You're going to miss out on three years of not having the phone or the laptop or the computer. So people consume because they prefer the present over the future and because they need consumption. Time preference is always positive. We always need things now. And if you don't consume now, you die now. The cases are sort of right in that, yes, if your money is going to be devalued, then yes, you're likely to consume more. And that exactly is the explanation for why fiat money has created this mass consumption society where everybody's just constantly consuming and everybody's always buying stupid plastic shit that they don't need, because that stupid plastic shit is better than holding on to money, because money is going to lose value over time. So when you see bitcoin work, you see that the bitcoins, bitcoin's value is going up and that's not stopping the network from growing. And on the contrary, as the value goes up, the network goes up, the bitcoin economy is growing. So the bitcoin economy has gone up maybe 100x over the last 10 years or so, whereas the bitcoin supply has only gone up by maybe 40% throughout those 10 years or something like that. I haven't run the exact number, but it's completely different orders of magnitude in terms of this growth in the size of the economy versus the growth in the supply of money, which is complete refutation of the Keynesian idea that the money supply needs to grow to keep up with the growth of the economy, because otherwise we'd get deflation and that would be terrible. Well, I can report from the future, you know, we've had deflation in the bitcoin economy over the last 15 years and I'll tell you, it is gorgeous, it is great, it is fantastic. It means that every year you can buy more than what you could buy pre. Well, I mean, not every year, because, you know, this year it's lower than last year. There's always one year out of each four where you get taken down a notch and you learn to stay humble. But three years out of four it
- [48:27]
A
works and everybody panics. Yeah, this is the one. This is the one.
- [48:33]
B
This is the one. Exactly. I mean, the cycles have become pretty predictable and I think you should probably be planning around them. But ultimately, if you just hold on for the long term, you're going to outperform pretty Much everything. So it shows that the money supply doesn't need to grow in order for the economy to grow. And in fact, if it doesn't grow, then that's better because people's purchasing power increases. And that is basically the completely devastating for the Keynesian viewpoint. And then the second thing is that the Keynesian and statist economists always want to tell you that money is a creation of the state. The state is what decides what money is. And you know, the state, and in their mind, you know, gold is only money because the king puts his picture on the gold coin. But that's not true, because gold was money before all of the world's current governments. All of the world's governments ever existed. Gold was money before them, and gold continued to be money after all these governments collapsed. So it's not that the picture of the king or the seal of the emperor is what made gold into money. Gold is what made the seal of the emperor into money. The fact that he put his seal on gold is why it worked as money. If he put his seal on paper, it wouldn't have worked. And paper only worked as money when it was backed by gold, and it only worked. And they could only remove the backing from gold after they basically criminalized gold, confiscated gold, centralized it, and made the banking system run on fake paper without gold backing. So there's never been a form of money that was born out of state fiat. So even though it's fiat money, it was never born out of fiat. There's never been a case of a government just handing out pieces of paper to people and saying, hey, there you go. This is your money and it's worth this much. It's never happened. You always have to have some kind of reserve asset backing the money in order to be able to distribute the money. So currently that is usually the dollar, and before that it was gold. But Bitcoin is the living reputation of this idea because, you know, previously they, you know, most people don't really know the history, so they'll just tell you it's money because it has the picture of George Washington on it. But now we see an actual form of money emerging on the market without government control, without government mandate. And it's already grown to be something like the, maybe the 10th largest currency in the world. And it's larger than basically all of the national currencies of the world, except for the largest 10 or so. And it did that without a central bank, without government authority. And if it's gotten this far, I don't see why it can't go further. And I'm yet to see a compelling case for why this dynamic won't continue. People will tell you all kinds of reasons why bitcoin makes them feel crappy. They don't like this about it, they don't like that about it. Okay, cry harder. As we bitcoiners like to say you don't like it, but it doesn't owe you to shut down because you don't like it. We're not going to just stop using bitcoin, better technology and make ourselves poor and submit to inflation because you don't like it. Explain how that's going to stop. And this is what's really powerful about it. Because as I was saying earlier, it's really the force of incentive. That's what's driving bitcoin. It's people not wanting to be poor, people not wanting to get shafted by inflation. And so economists, a lot of them have this. It's tragic and it's hilarious at the same time. They, and you know, that includes a lot of free market economists. So people who think of themselves as free market economists, like, they'll study it and then they'll say, well, I don't like the monetary policy. I think my idea of monetary policy is better. You know, we need to have a monetary policy that does this or that we need 2% prices increase, or we need supply to grow at a constant 2% or we need it to grow to match the growth in the economy or something like that. And therefore I don't like this monetary policy. So that's why I don't think bitcoin is good money. It doesn't matter. We're not going to adopt bitcoin based on what economists say. And it's so conceited and it's so tragic and it's so hilarious because in a sense it's almost saying, no, no, no, no, no. People are not going to follow their self interest. People are not going to care about being rich. They're not going to care about not going poor. They care more about what PhDs in economics say. And that's just not how the world works. Nobody is going to. Well, maybe not nobody. I mean, sure, their mom is going to care and she might stay away from bitcoin because her son told her it's bad money. But for the vast majority of people, they care a lot more about being rich and not being poor than they care about theoretical considerations. And bitcoin is just a day after day refutation of this idea. Okay, you don't like it, you have a better monetary policy, what are you going to do? You know, are you going to go take over the Federal Reserve and implement your foreign policy, your monetary policy? Maybe. Good luck. But even if you do, your money supply is going to continue to increase. Bitcoin supply is not going to increase. People who buy Bitcoin are going to witness their wealth increase. People who buy your stupid shit going are not. And that's just going to mean more and more wealth in the hands of the people who hold Bitcoin. So your only choice is whether you join early or you join late. Self interest is what is driving this. And it's, it's driving the process of monetizing Bitcoin and it's destroying the intellectual foundation for state money. Because we're seeing how actually money emerges on the market. It emerges because people hold it, because it's better at holding on to its value. And even if they don't understand that, even if people randomly choose their money, even if people choose at random from 100 different commodities what they're going to use as money, somebody chooses copper, somebody else chooses nickel, somebody chooses tree leaves, somebody chooses gold. Doesn't matter. Everybody can choose whatever they want. 20, 30, 50 years down the line, there's going to be a lot more copper, a lot more tree leaves, a lot more of everything that everybody chose except for the hardest money. And that's the one place where wealth is going to be preserved. So in a sense, water is going to end up in the bucket that leads, that leaks the least. Whether it's because people realize this and they go to the bucket that doesn't leak or because they don't realize it and they put their water in a leaky bucket and they, then they have no more water left. So the end, on a long enough time horizon, the money ends up in the least leaky bucket. Or in other words, wealth ends up in the hardest money. And that's, that's the, that's the powerful idea behind Bitcoin. And that's why we're not here to argue with people. We're not here to convince people we are going to be getting rich and we're going to laugh at you getting poor while you are being robbed to murder people because you deserve to get poor for holding the form of money that's financing all the slaughter and mass murder that's taking place in the world.
- [55:17]
A
So what, what do you think? I mean that's, that's a very optimistic take. And I, I, I share your view. On all of that. But what can governments do to stop us? Because this is not a secret conspiracy anymore. This is not a sly, roundabout thing. Politicians and central bankers and potentates of all stripes have noticed bitcoin, and they're talking about central bank digital currencies. So what can the government do to destroy this thing that threatens so much of their power?
- [55:58]
B
They can cry harder, is the short answer. Well, I think. I mean, obviously that's a little flippant that there's a lot they can do. They can criminalize the ownership of bitcoin, and that's going to be painful. It's going to cause the price to crash, but they can't kill it. So, yeah, maybe tomorrow Democrats get into office after Trump. And, you know, I mean, the Trump family has done incredibly corrupt things with their shitcoins. I don't even know how well known this is, but, I mean, they're basically selling pardons through their shitcoins. You buy part of their shitcoin with the understanding that you're not going to ever sell this. So you pump the price of their coins, allowing them to sell at a higher price, and then you get the pardon. So a lot of these pardons are all about shitcoins. And, you know, this isn't. This is a lot better known among Democrat circles, among the left, because people hate Trump. And so they're looking at that stuff closely, whereas on the right, a lot of people are not paying attention to it. And, you know, they're. They're very happy about the. The mean tweets and the owning Rosie o' Donnell and Hillary Clinton or whatever the hell MAGA is fixated on these days. So they're not really paying attention to that. But there's been a lot of corruption. So it may well be the case that, you know, President Alexandra Ocasio Cortez in the next term is going to really go after bitcoin. And I think it would be bad for bitcoin as it's to going, you know, they'll shut down a lot of bitcoin businesses. It'll make it hard for you to sell your bitcoin. They'll make it hard for you to hold your bitcoin. There are things that they can do that can make life difficult for bitcoin, but they can't kill bitcoin. So they may cause the price to crash. They may do all kinds of nasty things to bitcoin, but I don't think that it can kill bitcoin. And once you understand that it can't Kill bitcoin, you realize that whatever they do is just going to be a buying opportunity. So if the US Is going to go crazy and make it impossible and very difficult for Americans to hold bitcoin, that's just going to be a massive invitation for everybody outside the US to buy as much bitcoin as they can. So I would expect that it would recover. But I think ultimately what seems to be happening is that once you get it, it doesn't matter if you're in a government or if you're an individual. Once that switch clicks in your brain. Once you get it, immediately you switch your thinking from how do I stop this? To how do I benefit from this? And I think this is just absolutely fascinating. And it's an example of the power of economic incentives that I was discussing. So on the one hand, you'd think, well, I'm a government, I live off of inflation, and this thing is going to take away my ability to do more inflation. However, when you really understand what this thing is, you realize that actually the entire central banking government scam that you're running is not as profitable as just holding bitcoin. So I think the reason it survives is that it's going to be more attractive even to people that are running fiat slavery systems. It's better to just hold bitcoin than it is to run an entire government central bank scam built on giving people shitcoins and making them hold them while you inflate and increase the supply. So this is why, you know, the biggest beneficiaries from fiat inflation are still getting into Bitcoin. BlackRock is getting into Bitcoin, Trump is getting into Bitcoin. Lots of politicians are getting into bitcoin in the US all over the world, I think. I mean, I. I would have imagined earlier on, I would have imagined there would have been a lot more of government resistance and clamp down. It's part of the reason why I didn't buy early, because in 2011, 2012, I genuinely believed that there was going to come a day when they're going to realize that we're trying to replace the central bank and they're going to throw us all in Guantanamo Bay. So I'm going to stay away from this thing. And then they didn't, and the price kept going up. And then eventually you realize, well, what if they don't throw us in Guantanamo Bay? I better get some. And I think that's just what's been happening. It's quite outstanding to see it because people be, you know, Remember, Trump himself was pretty skeptical of bitcoin. He made a lot of tweets about it not being good and so on. But then eventually, you know, self interest kicks in, self interest dominates. And I think that's what's going to really ultimately happen. And I think, you know, even, you know, China sort of banned bitcoin, but they didn't really ban bitcoin. People just didn't use it. And I think it's just the cat is out of the bag. There's way too much liquidity at this point. Yeah, they could. They could give big punches to bitcoin. They could set it back, but they can't kill it. And a lot of people realize that, which means there's going to be a lot more demand and is just going to come back again and it's going to bounce back. And even if. And it may well be the case that we are past that point, that at this point, we're not going to be getting all these attacks. We're just going to be getting more and more governments and individuals and companies and corporations buying bitcoin.
- [61:11]
A
This is what the strategic bitcoin reserve is. Is the. The US Government sort of acknowledging that the cat's out of the bag?
- [61:21]
B
No, the strategic bitcoin reserve is just a way for Trump to get money from the crypto and bitcoin industry and to. To. To try and give some kind of respectable veneer to the shitcoin scams that he's running. I think this is. This is what ultimately comes down to. So a lot of people say, well, now the US Government is going to take control of bitcoin and they're going to use it to support the dollar, and Trump is doing it. And it's all part of this massive intelligent 3D chess game where Trump and Besant are going to build a new global monetary system around the bitcoins, and they're going to buy bitcoin and accumulate bitcoin. That's nonsense. They're just going to be making meme coins and shitcoins, and they're using all of this talk about bitcoin's geopolitical importance as a way to make it look like there's more to it than just their shitcoin scams, but it's really all about shitcoin scams, and there's not going to be a strategic bitcoin reserve, at least not anytime soon.
- [62:23]
A
So I'm assuming you didn't get in early on the Melania coin.
- [62:28]
B
No, I did not, unfortunately. Well, fortunately, actually, I've probably done 90% or something like that.
- [62:34]
A
Yeah, at least. So if you're up for it, let's do a second show on the Israeli Palestine conflict, Gaza, Lebanon, and your property rights analysis, because I think that's worth. That's worth a deep dive.
- [62:50]
B
Yes, let's do it.
- [62:52]
A
And in the meantime, tell us where we can find your work and your books and people that want to learn more.
- [63:00]
B
Yeah, so my website is sedin.com where you can find my books. My first book, the Bitcoin Standard. And then I wrote the Fiat Standard, which was a sequel. And then I wrote Principles of Economics, which is my introduction to Austrian economics in an engaging, easy to read kind of way. And then most recently, I published the Gold Standard, which is a new genre of book economic fiction. It's an alternative history of the 20th century, where fiat money dies in 1915, World War I ends, and we spend the century on gold, on a gold standard. And it imagines what a 20th century would have looked like on Hard Money. That was just published last November. So, yeah, these are my books. You can get them from my website or from Amazon. And I also run the Bitcoin Standard podcast. We make weekly episodes where I post, publish interviews, some of my articles, as well as some of my courses. And I'm on Twitter. I'm compulsively tweeting all day, every day, spicy hot takes. So come join me effeddeen on Twitter.
- [64:01]
A
All right, awesome. I appreciate this, and I look forward to our next conversation.
- [64:05]
B
Likewise. Thank you so much for having me, Matt.
- [64:08]
A
Thanks for watching. If you liked the conversation, make sure to like the video, subscribe and also ring the bell for notifications. And if you want to know more about Free the people, go to freethepeople.org.