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The "What is Money?" Show
WiM028 - The Frisby Series | Episode 6 | Beauty, Mythology, and War
00:58:27
Dominic Frisby joins me for a multi-episode conversation covering the concepts laid out in his book "Daylight Robbery: How Tax Shaped Our Past and Will Change Our Future"
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- [00:00]
Robert Reedlove
Foreign. Hey guys, this is Robert Reedlove from the what is Money? Show. And as you've learned by watching this show, Bitcoin is the single most important asset you can own in the 21st century. And one of the most important companies in Bitcoin today is NYDIG. NYDIG's mission is to facilitate financial security for all. They accomplish this by bringing a high level of professionalization and sophistication to the bitcoin marketplace. As a true game changer in the industry, NYDIG is safely unlocking the power of Bitcoin for forward thinking individuals and institutions alike. By using nydig, you will gain access to an end to end institutional grade platform providing bitcoin OTC transactions, bitcoin collateralized borrowing, secure custody, asset management, derivatives financing, market research and more. And all of these services meet the highest regulatory, governance and audit standards. Led by Robbie Gutman, Yin Zhao and Ross Stevens, NYDIG has absolutely exploded onto the bitcoin scene recently and is leading the way for ongoing institutional adoption in this nascent asset class. So please be sure to check out NYDIG as a single source for all your bitcoin needs. Dominic, you and I talked about in a previous episode how gold was sparked as money because of its beauty. And you delivered that great quote. I don't know who said it, but quote, beauty is truth. Truth is beauty. And then we explored how another form of beauty is mathematical beauty. So E equals MC squared. Like the elegance and simplicity of a, an all encompassing mathematical formula. I shared with you, I think on text, the bitcoin supply formula, which I find to be particularly elegantly beautiful. I'm a big fan of Jordan Peterson and he describes beauty as something essential, almost like food, that the soul needs, the human spirit needs. And he calls it a window into the transcendent. And that connected for me to that quote, truth is beauty. Beauty is truth. Because it's almost like we see things that are really relevant to our own. I guess in a Darwinian sense, you could say it's a fitness payoff. Whether it's a lush landscape or it's a beautiful woman if you're a man, or it's maybe a beautifully crafted dish of food perhaps could be beautiful. It's a little more tricky when you look at a work of art. It's like, I don't know what that's nourishing in us exactly. But this, this yearning for an aesthetic pleasure, I guess. So how do you, how do you think about beauty? Like what? What is it? Is it? Yeah, what is it?
- [03:19]
Dominic Frisby
Well, I have this odd life, Robert, where these weird opportunities seem to come to me. And I found myself about four or five years ago presenting a TV series on Italian tv. I can speak Italian, but I presented it in English about. It was a six part series about beauty and I'd never thought of beauty at all before. And then I suddenly had to write an entire TV series, you know, six one hour episodes all about beauty. And it was talk about a dream job. And Italians are much more aesthetically aware than we are in England. And if you want evidence of that, just you look at. Commonly the word bella or bello appears in Italian compared to how much we say beautiful in English. Like to an Italian everything is bello, bello, bello, bello. So I just think they're just a more aesthetically aware people than certainly the British. And you just look at how well they dress and their architecture and all the rest of it and the style. But I was. So we did and we went all the way around the world going to beautiful places and filming pieces to camera. And it was just wonderful job. Yeah. And so. And we did a whole episode in Greece and I've sort of fell in love a little bit with Greece and we did a lot of in Venice and then we went to Seoul. That's why I was in South Korea. And we, we. Because that's the sort of center of the plastic surgery is in Seoul. So people, I think something like 90 of the plastic surgery that takes place around the world, people go to Seoul for it. And it's bizarre because you've got all these sort of Russian women, basically Aryan women going there to try and make their eyes have a bit more slintier. All the local women trying to have the slint taken out of their eyes. And everyone wants to look different to how they look. But so I sort of became a mini expert in not, I won't use the word expert, but sort of reasonably informed about beauty. And we talked in the first episode about us finding beautiful, you know, the Darwinian thing of us finding beautiful something that is good for us in some way. So there's that landscape, the Pleistocene landscape scape on which mankind thrived. You know, the hills in the distance, the clearings, the trees, the animals, the water, all these things essential to our survival. We find that landscape beautiful. And the emotion that is triggered when we see something beautiful is the same emotion that mathematicians feel when they, you know, see a beautiful formula or they solve an equation. And I just wanted to read this quote. We talked about Beauty and truth and Jordan Peterson, I just love that guy. And I'm surprised he hasn't gone down the bitcoin rabbit hole sooner. But he talks as well as beauty. He talks about truth. And I had an interview the other day with all people, Tucker Carlson and. But he was talking about the need to be truthful, even if the truth is the harder thing to say. And it's easier in that moment to just, you know, say a lie or a white lie or whatever. And. But if you are truthful, the reality you create is based around your truth. So even if in the short term it's harder to utter the truth, ultimately it's for the good because what you create is based around your truth. And it was a wonderfully inspiring two minute talk that he gave. But there is this relationship between beauty and truth. And you talked about the transcendent. So I'm just going to go to Plato, the old Greek philosopher, Plato, who had this idea that what we see on earth is a shadow of the divine. And beautiful things are replicas of beauty itself. And we're all born with knowledge, but we forget it when our souls are trapped in our body. And learning is similar to remembering. And appreciating beautiful things is the quickest thing you can do on the path to enlightenment, on the path to knowledge, to get back our transcendent self. And so you need to, whether it's appreciating flowers or sunset or music or people. And the next thing the ancient Greeks did is you have to recognize the ancient Greeks actually tried to measure beauty. They had their golden ratio, you know, the mathematical alignment and proportion and so on. We're back to the importance of architecture here. Beautiful architecture. And true wisdom, according to Plato, was knowing beauty itself. That was the most enlightened state that somebody could reach. So that's one little sort of chapter on beauty. They were quite looks fascist, if that's the right word. The ancient Greeks, they had this also this idea that your beauty was a gift from the gods. And if you were beautiful on the outside, it meant you had inner perfection too. Now often beauty is a sign of health. So there is a sort of little bit of truth. But they felt that physical and moral beauty were linked. Now if you look at the behavior of certain Hollywood stars, you'd say, perhaps that's not true, but, but beauty on the outside meant beauty on the inside. And they actually had a word for this. Or the Greeks still have a word for it, which is kalogathia, Kalogagathia, which means beautiful and Good. But there is something to it. Because if you look after your body, you looked after your mind. You look after your mind and then that's a sort of, you know, like going to the gym and running and keeping fit. You feel better. But if you. But callocagathia was especially linked to heroism and great deeds. It was like a sort of ancient chivalry. And it was something that ancient Greek heroes aspired to. They wanted this calligraphia. Now, I'm just gonna turn now to Oscar Wilde on the subject of beauty. And this is a quote from his book the Picture of Dorian Gray. And he says, beauty is a form of genius, is higher indeed than genius, as it needs no explanation. It is one of the great facts of the world, like sunlight or springtime, or the reflection in the dark waters of that silver we shall call the moon. It cannot be questioned. It has the divine right of sovereignty. It makes princes of those who have it. Now, let me ask you a question. What is the most persecuted group, the most discriminated against group in society? Is it white people? Is it black people? Is it old? Is it young? Is it working class white men? Is it Muslim? What is the. Do you know the answer to this?
- [11:19]
Robert Reedlove
No, I don't. Is this along a racial dimension?
- [11:22]
Dominic Frisby
Nope.
- [11:23]
Robert Reedlove
No. Less discriminated? I don't know. Maybe. I mean, I would guess if we're talking about beauty, maybe the not physically beautiful people.
- [11:35]
Dominic Frisby
Correct. Absolutely correct. Well done. Robert. Hit the nail on the head. There's an American economist called Daniel Hammermesh that's done studies on this, and he's found that if you put yourself in like the bottom 20% quintile, you know, of.
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Robert Reedlove
Of.
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Dominic Frisby
I mean, you know, I'm hesitant to use the word ugly because it's such a horrible word to describe a person as unattractive, perhaps. Unattractive, whatever word you want to use. But they get paid less. They get overlooked for jobs. When they do get jobs, they get overlooked for promotion. They are more likely to commit crimes because of the fact that they are less economically well off. When they do commit crimes, they get longer sentences and bigger fines. They get overlooked for loan deals. And you hear this thing about microaggression and unconscious bias. They fall victim to that all the time. And over the course and as a result of this, they're more likely to be depressed and so on and so on and so on and so on. And so we sort of got. I got sidetracked a bit of that because I was more interested in the mathematical beauty of proportion and all that kind of thing, but it is all connected. And so. But an interesting little side note.
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Robert Reedlove
No, it's very interesting. I've read two, I think this was in maybe the Economist magazine years ago. That was the one dimension they were exploring. I guess symmetry was their measurement. So that was their measurement for attractiveness is how facially symmetric you are. That the more symmetry you had. And then for, for a man it was the taller you are. Like your earnings and likelihood of socioeconomic success were very tightly correlated. For women, I think it was just looks and for men it was looks plus height.
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Dominic Frisby
Yeah, the most commonly requested thing by women at sperm banks is men over 6ft is tall. Yeah, it's tall. And they, it doesn't matter. Intellect, race, none of that matters is height. It's the most by far and away. And I think the same applies on like Tinder, you know, they all say over six foot tall.
- [14:04]
Robert Reedlove
Yeah, yeah, yeah. This is so, so it's so interesting how close, how close we are to this Darwinian reality for ourselves. Right. We can't, you can't argue with it, you can't reason it away, you can't led. You can't pass some legislation, be like, oh, you should prefer guys under six feet or what? It's just we were these. Yeah, we're two legged apes.
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Dominic Frisby
CEOs of multinationals all tend to be, are commonly all over six feet tall.
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Robert Reedlove
Yeah, yeah, I think that's right. So is that related to terrestrial dominance or something? Like if you're on the battlefield, you're a little taller, so maybe you stand out more. Like, what is that all about?
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Dominic Frisby
I guess it's stature. Yeah, Strength and stature.
- [14:53]
Robert Reedlove
Yeah. I would just be speculating there. I would. So the, the thing you mentioned earlier though, with the Italians, like having a much stronger esthetic sense than us, you know, we'll say English speakers. There's this concept called linguistic relativity. I think it also goes by maybe the Wolf Sapir hypothesis where it actually says that the language you, you think in shapes the thoughts themselves. So if you, if you think in a Romance language, you tend to think more romantically overall, more esthetically, versus if you're thinking in a more reductionist language like English or German, you tend to be a bit more precise and mechanical in your thinking. So I wonder if that, that's just an interesting thing to think about. Like the language we speak is actually a technology itself and there's some reflexivity between thinker and tech.
- [15:52]
Dominic Frisby
I find it very interesting the way language evolves and on the one Hand, there's a sort of movement to control which words you can use and which words you can't, you know, you mustn't use. You know, and this is all part of that, you know, offense culture and all that you can, you know, you have to call a black guy a person of color or something. You know, there's all these terminologies that involve. And if you use the wrong word or use an outdated word, then suddenly you know, you're guilty of all sorts of hate crimes. You're like, oh Christ, I just used the wrong word. I'm not, I didn't actually intend any malice. But so there's that. But at the same time, language just constantly evolves and evolves and evolves and you know, people try to regulate it, but it just keeps on evolving. And you know, the English we speak today is, is so different from the English. You know, when you listen to people talking from little video clips from the 1950s or somebody, little vox pops from the 1950s and just people spoke so differently then and how people spoke 100 years ago. And you know, the difference between American English and English English, English English, we tend to use much more conditionals and I think we use more tenses. American English is probably a little bit simpler than English English. And that's probably a result of so many people from so many different cultures congregating in America, you know, and the language probably simplified a little bit because for so many people it was their second language. But it's, it's wonderful how language just absorbs everything you throw at it and just, it's just a sort of continuous evil evolving. It just never stops evolving. And you know, there's my kids. I've got 20 and 18 year old and 16 year old kids. But the 20 and the 18 year old just use words I've never heard before.
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Robert Reedlove
Yeah.
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Dominic Frisby
You know, sort of London slang and so on. And it just, it's amazing. And then you get like, in the UK, we have huge immigration in the last 20 or 30, 40 years with huge immigration from Asia and Africa to the uk and so you'll have people who speak some African language or some, you know, Pakistan, some Asian language and their parents speak that language and barely speak any English. And then as a people, those are, you know, essentially genetically that person is African or Pakistani, but he speaks English like. Well, I was going to say like an Englishman. But he is an Englishman. Do you see what I mean? But he's speaking and it's sort of, I don't want to say not his genetic language. But does he feel that he's not, he's still, you know, that the language he's using is probably shaping his thinking, you know what I mean? But it's not his. I don't even know what the word is. It's not his native tongue or. Well, it is his native tongue, but it's not his. Genetically native.
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Robert Reedlove
Yeah, yeah, genetically native. Right, right, right.
- [19:21]
Dominic Frisby
And I don't, I think genetics the wrong word. I don't even, I'm struggling to articulate it, but I think you, you understand what I mean. And it's, it's. I just, I just find it very interesting. And what are the. I'd love it if somebody could explain what all the, the psychology and what, all the processes are.
- [19:39]
Robert Reedlove
What. Yeah, it's another thing I've noticed, I don't know if you've noticed as much is that the, the technological realities that we're living in start to reshape the language too. So you'll, you'll notice a lot of these phrases creeping into the modern age. People are like, you know, let's do a download real quick. You know, they're talking about just sharing maybe an idea, but they're using a term that we really just got from computers recently.
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Dominic Frisby
Brain dump.
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Robert Reedlove
Yeah, brain dump. I'm struggling to think of a number of examples. I meant to make a list of these because I hear them all the time and I'm like, there's another one. People are.
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Dominic Frisby
My daughter will say lol rather than laugh.
- [20:22]
Robert Reedlove
Yeah, lol. Yeah. Or so, yeah, sometimes I'll leave the room and I'll be like, brb. You know, that all comes from being on the computer, which is silly. But yeah, there's just such a. And this is just an underappreciated aspect of existence, I think, is this reflexivity. You know, we mentioned earlier, Churchill, the buildings we make in turn make us, you know, the tools we make in turn shape us. Like there's a, There's a co evolution between creator and created where we create a certain tool for a job, but then that tool, by virtue of using it over a long period of time actually shapes our evolution and adaptation back. So there's this, there's the all. It's feedback loops everywhere you look. You know how. So that's a really interesting thing. So my. What I can't, what I struggle with is back to beauty is. It seems like we're identifying beauty based on a fitness, a Darwinian fitness payoff to ourselves. Those tend to be things we find beautiful but how does art fit into that equation? Like it seems like art is something, it's one of the most valuable objects in the world. If you look at some of these super rare paintings that are worth hundreds of millions of dollars, what's going on there? There's all this history and narrative collapsed into this one artifact that we call maybe a Michelangelo painting or a Leonardo painting. What is the relationship between beauty and art?
- [21:59]
Dominic Frisby
Well, there's definitely an emotion that people feel, a sensation that people go through when they experience beauty, when they see something beautiful. You know, my mum will say, you'll see a photograph of some, you know, Audrey Hepburn or something when she was young and she'll go, oh, she was so beautiful. And you'll see a beautiful painting. And so I guess the, one of the values of that art is that it inspires this emotion of beauty. But then again, you can feel that same emotion just by looking at a beautiful landscape. You don't need to pay a million dollars. So I think the value of art, and also now it's very interesting, is art and beauty have gone separate ways with a lot of modern art. It quite deliberately isn't beautiful.
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Robert Reedlove
Yeah.
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Dominic Frisby
And maybe that's another symptom of a broken fiat society.
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Robert Reedlove
Yeah.
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Dominic Frisby
In fact, I rather think it is.
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Robert Reedlove
Yeah.
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Dominic Frisby
But you know, there's the story of the guy who just had the bricks and he sold them for X million dollars. And you look at Tracy Emin's stuff and it definitely art inspires emotion. But I have to say I would only be buying that kind of art if I had money to throw away. And a lot of the time it's money laundering and all sorts of other reasons why it goes on. It's not just about. Then it's a status symbol as well. But that said, you know, I buy art all the time.
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Robert Reedlove
If I like it, I can see that right behind me.
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Dominic Frisby
And, well, this. And, and I like to think I create it as well.
- [23:48]
Robert Reedlove
Yeah.
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Dominic Frisby
So. So I, I can't necessarily explain the value of, of, of top art except to say that, that it's a lot of it is beautiful and it keeps its value. Yeah, yeah.
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Robert Reedlove
The relationship between modern art and fiat. I learned this from Joseph Campbell. I think he said that roughly that the job of the artist is to mythologize the present for future generations. So that when we look back on the art of the time, we can see the zeitgeist of the time embodied in these artifacts. And that's what I would, I think actually modern art, which is this a lot of it's trash, frankly. It's bananas duct taped to the canvas or whatever it is, mythologizing the current consumerist society that fiat currency has induced. So I don't even think it's bad art necessarily. I think they're doing a good job of depicting what state the world is in. We're in this poisoned consumerist, high time preference mindset.
- [25:04]
Dominic Frisby
I think that's absolutely right. And the. That's a lovely quote about it's mythology. I think if some of the old great artists saw the art of today and they saw the society we're in today, you know, great empires at the pinnacle of the empire. They're also at their most beautiful, certainly architecturally. But there's. I think they would consider what's going on almost heretical. But yeah, there's a relationship in mathematics between beauty and truth. And the Greeks thought there were three ingredients to symmetry, proportion and harmony. And beauty was something to be worshipped, idealized, but also imitated and reproduced in lives, in architecture, in education and in politics. And that was very much the attitude of the ancient Greeks. And I will say the one, perhaps. I mean, it was such a great society, ancient Greece, because as well as this worship of beauty, taxation was voluntary.
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Robert Reedlove
Right. The liturgy.
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Dominic Frisby
The liturgy, as we said. So I think there is this. But Greek citizens felt tremendous responsibility to use that word again towards their society, which perhaps we don't feel today. So again, you shape it by the way you tax it, or taxes. I mean, there's so much crossover, it's difficult to know which comes first.
- [26:57]
Robert Reedlove
Yeah, I wonder too. So this relationship between the money and, I guess you would say the beauty that we produce or the beauty of our productions. Is this something that. I mean, I've heard this reference by authors like Safedin in his book. He talks about essentially how ever since we've gone to a fiat currency paradigm, that art has suffered. And you can see it in modern art. Is this something that the ancients ever talked about or explored was Plato. I haven't read much Plato. I've read some Aristotle. Not a lot of Plato. Was there any exploration of this parallel between the character of the money and what we see in society? They probably didn't know any better because I guess they were always on hard money standards.
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Dominic Frisby
Yeah, I don't, I don't. I don't know. I think they were on. I think they were on hard money standards. But the. I've just. I'm just gonna just change tack for a second.
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Robert Reedlove
Robert.
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Dominic Frisby
Coming back to this idea of the Greeks and the Beauty and this and the transcendental, the middle. Okay, so Jordan Peterson likes his myth. So let's tell you a myth. Daedalus was one of the greatest craftsmen in ancient Athens, and he built the labyrinth for King Minos of Crete. You know, the story of Theseus and the Minotaur. But then he then gave Ariadne the ball of string which she gave to Theseus. That helped him defeat the Minotaur. And so King Minos of Crete imprisoned Daedalus. And then Daedalus made some wings out of wax and feathers. And that was how he and his son Icarus were going to escape on these wings. And he kept saying to his son, fly the middle course between the spray of the sea and the heat of the sun. Fly the middle course. And Icarus didn't listen to his dad, and he flew. He got all excited because he was flying and he flew too high, and the sun melted the wax of his wings, and he fell into the sea and died. And that middle way between the sea and the sun was beauty. And Socrates said something similar. He said, a man must know to choose the mean and avoid the extremes. And Plato, with his republic, he said the ideal republic would be somewhere a mean between monarchy and democracy. And Aristotle was always going on about this middle state. And so there's this idea, and then you have the golden mean. The Greeks called it beauty, but you keep getting this idea of the golden mean. Moderation. Confucius, Buddha, Judaism, Christianity, Islam. There's all this middle way of moderation and calmness. And to the ancient Greeks, I think that was one of the things that they felt was beauty.
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Robert Reedlove
Yeah, so this reminds me of the way actually, in Daoism. But they're always talking about this middle. I guess Peterson would say it's the edge of order and chaos, right? That's where meaning is found. That's where beauty is found. That's where the entrepreneur exists, by the way. The entrepreneur has got one foot in order, which is the society that he's updating or trying to update through his explorations, and one foot in chaos, which is some new business idea or venture that he's taking risk. He's putting his money and capital into the game, trying to figure out something new. It's like we are these exploratory creatures that need. We need. Like. It's like surfing, right? You have this optimal experience. You have the flow state when you're upright on the surfboard. You're in order, you're in stable order, but you're riding right on the Edge of disaster. You're literally surfing the edge of disaster on the wave. And that's where you know that that analogy can be applied, I guess, to any domain of life.
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Dominic Frisby
Exactly where Icarus needed to be.
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Robert Reedlove
Right. The middle way between the ocean and the sun. And that seems to be related to beauty as well, because we could say time flies when you're having fun kind of thing, or when you're in a flow state. That's life lived beautifully. I think we would all want to be in a flow state as much as possible. I think it's probably why surfers report such high levels of satisfaction with life. It's like they're quite actually out there all the time.
- [32:14]
Dominic Frisby
Is that right? I didn't know that. Are you a surfer yourself?
- [32:17]
Robert Reedlove
No, I'm a novice. You know, I really want to get more into it for all the reasons we're laying out here. But, yeah, it's. Professional surfers have one of the highest reported job satisfactions in the world. Yoga teachers as well, I think was another one. But. Okay, makes sense.
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Dominic Frisby
You know, it's like bitcoin maximalist in a bull market.
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Robert Reedlove
Talk about order and chaos.
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Dominic Frisby
Yeah. So, yeah, we're recording this interview, by the way, the day after the infamous Elon Musk tweets sent the bitcoin market into mayhem.
- [32:59]
Robert Reedlove
Yeah. Do you have thoughts on that as far as the why and where he's coming from?
- [33:07]
Dominic Frisby
I think a lot of people might be reading a bit more into it. You know, a lot of people are assuming. Some people are saying he's pumped the market up so that he could sell. And then, you know, now. Now he sold, he's pumping it down. A lot of people are saying he's trying to secure grants, so he's buying favor for himself by criticizing the environmental cost of bitcoin. One has to assume he's done at least a little bit of research into it. And so it's possible that his criticism, whether right or wrong, it's possible that it is genuine. He probably thinks too many fossil fuels are burnt in the creation or the mining of bitcoin. And I mean, I know something like, is it 75% of Bitcoin mining is renewable energy? I've read. I'm not sure how true that is.
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Robert Reedlove
Yeah, I think there's a reason.
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Dominic Frisby
If there's a lot of coal gets burned in China to make bitcoins, I wouldn't.
- [34:12]
Robert Reedlove
Yeah, I think that's correct. There's a report published recently by Square that goes into that. The percentage of renewals. But I think it's around 70%.
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Dominic Frisby
Yeah. In that case, what's his problem? And, you know, there's really clever ways. You know, I subscribe to the whole. You know, as mankind has advanced, he has consumed more energy. He just has. And, you know, in the agricultural revolution, he got animals to do the work for him, and then in the industrial revolution, he got machines to do the work for him. And those machines have got steadily more power. You know, it's. It's a. The amount of energy you use is almost a sign of how far you've come.
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Robert Reedlove
It measures civilization.
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Dominic Frisby
Yeah. And, you know, the more energy we use, the better we will get at using energy well and safely and in ways that are unharmful. And, you know, that Alex Eckstein book about the moral case for fossil fuels, you know, there's a lot of really important, strong arguments that he makes that there's a great deal of truth. Maybe Elon Musk just needs to be sat down for a couple of hours and be forced to watch Michael Saylor videos.
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Robert Reedlove
I get the sense that he's just playing a lot of games at a lot of different levels. And, you know, he. One of his biggest revenue sources is government subsidy and government grants, so he probably had to throw him a bone to some extent. I.
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Dominic Frisby
At the end of the day, you're in the sway of your paymaster.
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Robert Reedlove
That's right. No man is better than his incentives. And at the end of the day, Elon's primary revenue source, it seems, is the fiat spigot, whether it's government subsidy or just dollar payments.
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Dominic Frisby
We talked about that book, secrets of the 1%, and how the richest people in history have usually made their money through getting legislation made in their favor. And he is straight out of the copy book.
- [36:29]
Robert Reedlove
Right, right. So he has to. He has to appeal to the enviro socialist to get his favorable legislation. Yeah, sure. Yeah.
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Dominic Frisby
I blocked him on Twitter as.
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Robert Reedlove
It'S been such a. Because I don't know, I kind of admired the guy originally, but now he's so wishy washy and all over the place, and he just seems like it's hard to distinguish whether he's trolling or serious. And I don't. I've just.
- [37:01]
Dominic Frisby
Yeah, I mean, I think he likes. He likes. He certainly likes attention. He's got a big ego. I think you have to have a big ego to be that success to get that successful. He likes the attention and he obviously sees himself as a comedian. He wanted to get on Saturday Night Live and he likes doing all his little Doge memes, which he probably has someone write for him. And he probably gets off on the little buzz we all get off on. When you put something on Twitter and it gets retweeted 100 times. Everyone gets their little. Whatever that dopamine rush is. And he seems to need that as much as the next man.
- [37:33]
Robert Reedlove
Yeah. Which just contradicts all of this higher emission he seems to bring to the table where he's talking about needing to go to Mars to save civilization. It's like you would think he would understand the relationship between civilization and energy usage. Right. We actually.
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Dominic Frisby
If I was on a ship flying to Mars, I'd rather Michael Saylor was flying it than Elon Musk.
- [37:55]
Robert Reedlove
I agree with that. Yeah. I don't know. It's. But that because the energy aspect of bitcoin is so nuanced, that's going to be the number one attack vector, I think, for these funds. And it's not going to stop. So that's where education is especially important.
- [38:17]
Dominic Frisby
Yeah. Bitcoin's really vulnerable there. You're absolutely right. I've done my little bit in that argument. I've made my little videos and I've written my articles explaining bitcoin energy consumption. And Nick Carter does it well. Marty Bent does it very well. What can you do? You just got to make the argument. And if they ban. But they can ban bitcoin mining, it's vulnerable. I can't see there being an international ban on bitcoin mining, but I can certainly see them trying it. If bitcoin gets too successful and there's inflation and fiat monies are collapsing. Blame bitcoin mining.
- [38:59]
Robert Reedlove
Yeah, they will.
- [39:00]
Dominic Frisby
Same way that. I know it sounds ridiculous to me. In times of economic crisis, the most ridiculous accusations get made and the most ridiculous people get blamed for stuff.
- [39:11]
Robert Reedlove
Right.
- [39:12]
Dominic Frisby
Yeah. I think that's the biggest threat to bitcoin, as I think about it now, is fiat currency. I won't say collapse because it just never happens, but major run on fiat currency, hyper bitcoinization, concerted UN ban on bitcoin mining. And they won't attack bitcoin holders, they won't attack bitcoin owners. They'll attack bitcoin mining. How screwed with bitcoin mining be a China banned it.
- [39:50]
Robert Reedlove
Well, they've made attempts in the past. I guess the defensive mechanism that bitcoin mining has is that it's just a miner is this big. Basically there's little modular miners. So if you try to ban it in one place, you can really Just pack them up, put them in a box, ship them elsewhere, plug them back in. So it's a very amorphous and adaptive network. But it's also very hard to trace where bitcoin mining is occurring. I mean, they can trace the energy consumption patterns, but again, it's just kind of like whack a mole. You try to shut down one data center that's mining bitcoin, they get boxed up and sent elsewhere. And then again, if your country, it's again, more likely they would tax it because there's a revenue. There's a huge revenue opportunity there. So if you just outright ban it, then you're eliminating the tax base from your jurisdiction and you're incentivizing other jurisdictions to pick it up. But to your point, if it gets to that level where it is determined to be an existential threat at an international scale, there could be a coordinated ban, coordinated effort against it.
- [40:59]
Dominic Frisby
People are still fan, right? They'll be citadels with armed guards, the system. I remember meeting a guy from Malaysia three or four years ago. He was trying to set up a bitcoin mining operation in Bhutan, and it was a hydroelectric thing. I wanted to put some money into it. I don't know what happened to him. He disappeared. So he was probably a scoundrel. But I looked at the economics of it and they've got shed loads of hydroelectricity in Bhutan. And are they going to be able to enforce bitcoin mining bans in Bhutan? I don't think so.
- [41:36]
Robert Reedlove
That's the thing. The bitcoin mining network becomes the energy buyer of last resort. And there's going to always be this incentive to plug the thing in and monetize unused energy, or what they also call stranded energy, where it's not economically feasible to harness the energy and ship it to the grid or sell it into the grid because of maybe it's remoteness from the grid. So there's this intrinsic component of demand there that I don't think you can legislate away. So I don't know, it'll be interesting to see it play out.
- [42:17]
Dominic Frisby
By that time, somebody will figure out a way to use tidal power in their citadel that they've got in the middle of between Nigeria and Brazil. And they'll be using tidal wave power to mine bitcoins or something.
- [42:30]
Robert Reedlove
Right? And at the rate solar is collapsing too, the cost curve of solar is collapsing faster than any other energy source. It seems like that would be something that would really pick up too, that you just have this off grid bitcoin mining via solar, maybe.
- [42:48]
Dominic Frisby
I looked into solar quite a bit about 10 years ago, maybe it sorted itself out. But solar's been one of these technologies that's been promising great things since the 1970s and it just never seems quite to nail it. Maybe eventually will because ultimately the sun's the best energy source of the lot. Maybe eventually it will. There's always something that gets in the way.
- [43:11]
Robert Reedlove
There's a bit of a gradually then suddenly thing there going on with solar where again, its cost has been exponentially declining every year over year. So now it's getting to the point where it is, I think it's already the cheapest source of energy, certain types of solar, and it's getting cheaper, faster than everything else. So a lot of the long term energy guys I've talked to, they said solar is the long game. And so if you're solar, then you're decentralized from the grid, which makes it even harder to track, regulate and all of that.
- [43:44]
Dominic Frisby
Yeah, you can start up a mine in bloody Chad. No one's going to sit there in the middle of the Sahara Desert.
- [43:50]
Robert Reedlove
Yeah, exactly. And then talk about a counterargument to Elon's fud. It's like bitcoin then becomes the greatest incentive in the world to set up renewable energy centers via solar. But yeah, I don't know. In the meantime, it's confusing. The other element we don't talk about a lot is really Rothbard has written a great deal about this. To protect against pollution. What you really need is sound private property rights. So if you're polluting my river and I've got property rights in the river, I'll sue you. And so long as those property rights are enforced, you'll have a disincentive to pollute the river. So it prevents tragedies of the Commons when you have private property rights.
- [44:37]
Dominic Frisby
Yeah. And the most wasteful bitcoin mining is efficient. It graduates to where energy is cheapest. It graduates to where energy in many cases wouldn't even be used if the bitcoin mining thing wasn't there, it'd just be thrown away. And then you look at how wasteful governments are, like the UK's NHS and its education systems and I'm sure any number of government departments in America. And I bet the military. I dread to think of the environmental harm caused by the US military. And so you sort your own way, stuff out folks and then you come lecturing everyone else.
- [45:23]
Robert Reedlove
Yeah, exactly. I mean, there's no more. I tweeted that out there's nothing more wasteful than war, right. You're mobilizing capital and people to go and destroy capital and people. And then there's all these other second the landmines.
- [45:39]
Dominic Frisby
You don't even get loot anymore in the old days. You literally get loot at the end of it. It's got a good business. You can't loot the country after you've bombed it anymore. How the world has changed.
- [45:49]
Robert Reedlove
Well, they'll loot the gold still. At least they were in World War II. But that's another great looting the oil.
- [45:57]
Dominic Frisby
In a way in the Middle East.
- [45:58]
Robert Reedlove
Yeah, looting the oil and the trade flows. There's another beneficial aspect of bitcoin is if you're on a bitcoin standard, it's really hard to loot. Really hard to loot the bitcoin.
- [46:12]
Dominic Frisby
Well, yeah, but there's hacking.
- [46:15]
Robert Reedlove
Yeah, but if you just assumed you're on a bitcoin standard and say we still have central banks, assuming that bitcoin's kept in a really sophisticated multi signature scheme, you could go and invade a country and conquer them. But you're not going to get their money, you're not going to take their money. It's just different than gold. Gold invites violence. Bitcoin actually disincentivizes violence or makes violence less economically rewarding.
- [46:48]
Dominic Frisby
Mate, you'd have to go back for bitcoin. You'd have to go back to the Dane Geld model, Alfred the Great's Dane Geld model, which was I won't invade you, but I want you to pay me a bitcoin every month and I won't invade you.
- [47:03]
Robert Reedlove
Interesting.
- [47:04]
Dominic Frisby
At least it keeps the peace.
- [47:06]
Robert Reedlove
Yeah.
- [47:08]
Dominic Frisby
But as Rudyard Kipling said, if you don't get rid of the Dane Geld, you won't get rid of the Dane.
- [47:14]
Robert Reedlove
Interesting. Yeah, I wonder what that. I was thinking about that too, what that would look like because there's a case to be made that, well, clearly inflation is used to fund warfare. Typically that's typically when countries go off the gold standard or eliminate gold redeemability, is when they need to print a bunch of money and go to war. So if you're on a bitcoin standard, say on a bitcoin standard, and there's a US China war, China's the invader, US is the defender. China would then need to inflate their money supply to pay for the war. But then that would cause a lot of bitcoin to flow out of China. Right. Because they've inflated the money supply similar to the way gold. If you abuse monetary policy, historically, gold was a natural check on that because then gold would flow out of your country and at some point you'd just be kept in check from a monetary policy standpoint. So then that would mean your country's becoming less wealthy more rapidly, the more aggressive you are in warfare. And that would accrue an even greater defender's advantage. I just wonder how that would operate. I'm going to try to write something about that. But still thinking through it, how much.
- [48:48]
Dominic Frisby
Do you think the Chinese authorities get? Gold. Sorry, get bitcoin. Now, let's assume we talked about how much gold China has and we assume that it's deliberate and they're deliberately understating it because they don't want to shine too brightly and they get the value of gold and they want to increase their gold holdings and lower their US dollar holdings. And they do feel they are the best people in the world and at some point they will want to be top dog in the world, but they're waiting for the right time to do that. Do you think whoever the Chinese state planner is, I can assure you that most government ministers in the UK won't have read my book on bitcoin and they won't have read Safedine book on bitcoin and they won't listen to your podcast. Do you think Chinese policymakers get bitcoin or are they in the wrong side of 50 and it's just some young people's fad?
- [50:00]
Robert Reedlove
I would anticipate that the general state level understanding of bitcoin in China and in other countries is probably proportionate to Bitcoin's market cap. Actually, the bigger it gets, the more threatening it is, the more seriously they're taking it, the more closely they're studying it. But I do have this theory that I've shared before that I really think the value proposition of bitcoin is not that complicated, especially if you're a state actor and you understand the value of gold like clearly China does. It's like when you start getting to the nuts and bolts of, well, why do we value gold? You start to see the first principles or properties of money and you evaluate bitcoin through that same lens, that it quickly becomes apparent that this is a potential disruptor, at least to gold. And at that point it's like, why wouldn't you just have some of this thing as an insurance policy? If it does succeed, you would want some exposure to both asset classes. So I don't know today, I don't know where their level of understanding is. But I would guess that it increases as bitcoin's market cap increases.
- [51:12]
Dominic Frisby
Okay, I certainly agree with that. So it's a slightly loaded question why I was asking you that. But my, you know, my theory is, is that when an empire rises, its money is sound, and when it falls, its money isn't.
- [51:27]
Robert Reedlove
Yeah.
- [51:27]
Dominic Frisby
And, I mean, I can't claim that theory. Everyone has that theory. But China is an empire that's rising. And no matter what you might think of China and its record on human rights and some of its authoritarianism, I imagine that things done by the early Roman empire or the British or whatever were just as bad. And as they get wealthier, perhaps the Chinese will become, you know, more humane, because I think we. The wealthier we get, the better we behave, is a general characteristic of humans. So. But if we assume that its money will be sound as it grows, is it deliberate? Is it watching bitcoin, perhaps acquiring a little bit? Is it quite happy for whatever it is, 70, 80, 90% of Bitcoin mining to take place within its borders? Is that part of its plan? Or is that just a sort of accidental, lucky thing that's happened?
- [52:33]
Robert Reedlove
I would imagine they probably start to look at it as a free option. In a way. It's like bitcoin mining is occurring here, so it's more easy for us to tax it. And maybe even they've built a ton of energy infrastructure in China, too. This whole debt miracle of building all these dams and these empty cities. So with bitcoin mining operating as energy buyer of last resort, it seems like a very easy way for them to monetize a lot of that surplus capacity. I don't know if they've realized that yet. I don't know if they're doing it. But, yeah, just the value proposition of digital gold, plus a source of a way to monetize excess energy, which they have plenty of, seems like a natural fit for China to improve its geopolitical status. But in the long run, again, I still see it again, bitcoin dissolving these power structures from within, because the more it grows, the more most of the monetary premium in the world is on a system that no one can change the rules of. And that's the name of the game, if you're on the state, is you're bending the rules of the monetary and tax system to favor yourself and disfavor everyone else. But now all of a sudden, you're trapped within this game that you can't change the rules. So it starts to change the very concept of China and the CCP and these other centralized bodies of power over time. But I don't know. That's all theoretical, right? This is just me trying to game it out of my own mind. We don't have any historical corollary for this, but I do think it's a deficiency in a lot of people's thinking where they just think China will persist as this single indivisible unit on into the future. And so it's all like, what will China's Bitcoin strategy be? And failing to account for the disaggregation that occurs within the power structure as a result of Bitcoin existing. The historical parallel there is the USSR basically economically outcompeted by the us. So what happened? The power structure broke. It fragmented back into a lot of its old previously conquered territories and countries and just dissolved.
- [55:05]
Dominic Frisby
In a way, I would say that's more likely to happen to the US at the moment than it is very.
- [55:11]
Robert Reedlove
Likely to happen in the U.S. yeah, because we're way more indebted.
- [55:15]
Dominic Frisby
So Rudyard Kipling was an English poet who wrote, among other things, the Jungle Book, the film that was, you know, famously adapted by Disney. And he's sort of the favorite poet of the English. And he wrote a great poem called if. But the context of this was the Dane Geld, which was the money that King Alfred the Great used to pay off the Danish invaders with. But in telling the story of this poem, he. It has a much wider significance than just that tax. It sort of. It's one of those things. He describes the tax, but it applies to all of life. Anyway, here we go. Danegeld by Rudyard Kipling. It is always a temptation to an armed and agile nation to call upon a neighbour and to say, we invaded you last night. We are quite prepared to fight unless you pay us cash to go away. And that is called asking for Danegeld. And the people who ask it explain that you've only to pay em the Danegeld and then you'll get rid of the Dane. It is always a temptation for a rich and lazy nation to puff and look important and to say, though we know we should defeat you, we have not the time to meet you. We will therefore pay you cash to go away. And that is called paying the Danegeld. But we've proved it again and again that if once you have paid him the Danegeld, then you never get rid of the Dane. It is wrong to put temptation in the path of any nation. For fear they should succumb and go astray. So when you are requested to pay up or be molested, you will find it better policy to say we never pay anyone Dane geld no matter how trifling the cost. For the end of that game is oppression and shame and the nation that pays it is lost. There you go. Wow, cool poem, huh?
- [57:36]
Robert Reedlove
That is awesome. It's the first time I've ever heard that. Yeah, well, I'm going to be putting that in one of my next written pieces, so. Good.
- [57:51]
Dominic Frisby
Yeah, but it applies to anyone trying to take somebody else hostage, right?
- [57:56]
Robert Reedlove
Yeah. This is the, you know, the. The US we don't negotiate with terrorist policy.
- [58:03]
Dominic Frisby
Yeah, I suppose so, sort of.
- [58:05]
Robert Reedlove
Right. You just don't. You won't be extorted. Don't be extorted or you'll be extorted some more.
- [58:13]
Dominic Frisby
Never give terrorists the oxygen of publicity. Was the famous Margaret Thatcher line.
- [58:17]
Robert Reedlove
Ah, yeah. Interesting.