Is the Union About to Break? Blue vs. Red, China & the $1 Trillion Pivot | Impact Theory w Tom Bilyeu & Balaji

Summary

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Podcast Summary

Impact Theory: “Is the Union About to Break? Blue vs. Red, China & the $1 Trillion Pivot”

Host: Tom Bilyeu

Guest: Balaji Srinivasan

Release Date: March 28, 2026

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Main Theme

In this eye-opening episode, Tom Bilyeu and Balaji Srinivasan delve into the deepening polarization of American society, the fragmentation of U.S. democracy at the state level, and the rise of economic and geopolitical forces threatening the future of the American “Union.” Together, they unpack why California, Texas, and Florida are emerging as near one-party states, the economic consequences of these shifts, and how China, technology, and financial engineering have accelerated these trends. The discussion ranges from political incentives and state capture to global power dynamics, with a special focus on how individual and collective actions are shaping a future where “voting with your feet” may be the only meaningful choice left.

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Key Discussion Points & Insights

1. California's Economic and Political Dynamics ([00:42]–[06:24])

• California’s “Wealth Tax” and the One-Party State:
  • Balaji introduces the concept of viewing political parties as “meta organisms” — complex systems driven by emergent collective interests, not just individuals ([01:04]).
  • He argues California Democrats have engineered the state into a one-party system via gerrymandering and policies that either drive out or strip resources from economic competitors, particularly tech industry leaders ([01:50]).
  • Quote: “Democrats destroyed democracy in California... It's a one-party state where elections are held but the party always wins.” — Balaji ([03:35])
• Incentives and State as Startup:
  • The state is likened to a startup by Democrats, fueling self-serving NGO budgets, especially around homelessness: “What they’re optimizing is the NGO budget.” — Balaji ([04:41])
  • Comparison to the military-industrial complex as the Republican-forged equivalent ([06:24]).

2. Power, Incentives, and the End of Intra-State Democracy ([06:24]–[09:41])

• Entrenched Interests:
  • State-linked actors’ full-time focus on maintaining power and economic flows dwarfs the part-time or fragmented resistance by private innovators, making revolt nearly impossible ([06:24]).
• Rise of One-Party States Elsewhere:
  • Florida and Texas are moving toward similar one-party models for Republicans, while blue states get “response gerrymandering” ([08:04]).
  • “Democracy is ending within states. The only practical choice you have is to vote with your feet, your wallet, or your ballot.” — Balaji ([08:39])
  • The Internet may be the new “guardian of true democracy” by reducing barriers to migration and information ([09:41]).

3. Shrinking Pie and Financialization: U.S., China, and Global Power Shifts ([09:41]–[16:38])

• Declining U.S. Dominance and the ‘Zombie’ Economy:
  • After the 1990s, as opportunities abroad closed and financial crises hit, America shifted from expansion to managing decline—bailing out companies, and effectively “nationalizing” parts of the economy ([10:41]).
  • “Much of the economy was de facto nationalized... with the purchase of mortgage-backed securities, the bailouts.” — Balaji ([12:40])
• Deflationary Tech and Chinese Manufacturing:
  • Silicon Valley and China thrived on “doing more with less,” driving down costs globally and creating a bifurcation: goods and services touched by China or the Internet become hyper-affordable, while government-regulated sectors (healthcare, education, real estate) soar in cost ([15:07]).
  • “Everything that China or the Internet touches has come radically down in cost.” — Balaji ([22:04])

4. Inflation, Money Printing, and the $1.25 Trillion “Button” ([22:44]–[27:07])

• Inflation as Stealth Taxation:
  • Through vivid examples and historic NPR reporting, Balaji explains how the Federal Reserve “prints” money to prop up asset prices, driving invisible but massive wealth transfers ([24:07]).
  • “As Milton Friedman said, inflation is taxation without legislation.” — Balaji ([25:57])
  • “A trillion dollars... just by hitting a button. Nobody even understands that this is happening.” — Balaji ([26:17])
• Housing Prices and Future Risk:
  • The housing market is now far beyond the 2008 bubble, suggesting a much larger correction is likely ([24:27]).

5. Red vs. Blue: Polarization, Digital Secession, and Soft Secession ([29:46]–[35:00])

• Collapse of “One America”:
  • The concept of “America” as a single entity has dissolved into Blue America, Red America, and Tech America ([30:24]).
  • Graphs show the political and social polarization in Congress and among the population and social networks ([31:31]).
  • “The digital split has already happened... they don’t talk to each other, they don’t marry each other.” ([32:11])
  • “Ideology becomes biology in one generation. It’s like an ethnic split.” — Balaji ([33:02])
• Soft Secession and State Pushback:
  • “Soft secession” is the watchword fueling blue state resistance through lawsuits, non-cooperation with federal policies, and state-level policy autonomy ([33:34]).
  • Notable moment: Newsom’s open embrace of partnership with China, signaling a growing blue-state alignment abroad ([37:14]).

6. China, Canada, and the Internationalization of U.S. Fragmentation ([40:40]–[45:24])

• The Carney/Canada Connection:
  • Mark Carney’s moves in Canada (opening to Chinese goods, building infrastructure with China’s help) become a “land bridge” for blue states to align with China, bypassing Washington ([40:40], [43:59]).
  • Trump’s rhetoric about “invading Canada” and Carney’s newfound boldness show the weakening of old alliances and the fluidity of new geopolitical alignments ([44:01]).
• The In-group/Out-group Logic:
  • Balaji uses Scott Alexander’s “in-group, out-group, far-group” logic to frame Democrats aligning with China (as Republicans’ enemy's enemy), forming new international “tribes” ([45:24]).

7. Physical vs. Digital (Network State) & Scenarios For Disunion ([39:25]–[53:37])

• Network State:
  • Balaji clarifies “cloud first, land last, but not land never”—the physical still matters, but digital-first communities are the building block ([39:55]).
• Historical Lessons from Disunion and Decentralization:
  • Drawing on analogies to Civil War, post-Soviet states, and even religious monotheism/polytheism, the episode explores how the drive for unity and centralization cycles with fragmentation and independence ([46:06]).
  • The practical impacts: loss of economies of scale, new tariffs, mutual hostility, and the risk of conflict ([48:30]).
  • “By default, you have lots of tribes that fight with each other... by decentralizing, it created [conflict].” — Balaji ([48:30])
• Previewed Fragmentation in COVID:
  • COVID-era interstate compacts and hard borders were “unprecedented, but then became precedented”—showing how new forms of division can manifest rapidly ([51:48]).

8. The Clash of Meta-Organisms: Three-Way Fight ([53:37]–[57:59])

• Tech America, Blue America, and Red America are each imposing existential costs (“taxes”) on the others, through policy, regulation, and alliances both domestic and foreign.
• Future: The U.S. breaks not just into red and blue, but into a patchwork of tribes, possibly aligned with regions/ideologies in Canada, Latin America, and even China ([57:37]).
• Groupings will reflect political and economic realities, not traditional national labels ([57:59]).

9. Survival Strategies: The “Eye of the Hurricane” Approach ([58:07]–[59:54])

• Balaji’s advice:
  • “Get to a place where you trust the people around you and there’s a community there.” ([58:07])
  • “Location is more important than allocation.”
  • Lists of “ascending” geographies: Texas, Miami, El Salvador, Southeast Asia, Poland, Hungary, with a warning that even Dubai and the Gulf are no longer certain safe havens due to war ([58:54]).

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Notable Quotes & Memorable Moments

• “Democrats destroyed democracy in California... It’s a one-party state where elections are held but the party always wins.” ([03:35]) — Balaji Srinivasan
• “The purpose of the San Francisco government for Democrats is to award hundreds of millions... to homeless NGOs... to increase the homeless population and thereby increase the justification for their existence.” ([04:41]) — Balaji Srinivasan
• “Democracy is ending within states. The only practical choice you have is to vote with your feet, your wallet, or your ballot.” ([08:39]) — Balaji Srinivasan
• “As Milton Friedman said, inflation is taxation without legislation.” ([25:57]) — Balaji Srinivasan
• “Ideology becomes biology in one generation. It’s like an ethnic split.” ([33:02]) — Balaji Srinivasan
• “Soft secession... blue states learning they don’t need federal permission to govern.” ([33:34]) — Balaji Srinivasan
• “The Internet becomes a guardian of true democracy because people vote with their feet, with their wallet, and their ballot.” ([08:39]) — Balaji Srinivasan
• “Cloud first, land last, but not land never.” ([39:55]) — Balaji Srinivasan
• “By default, you have lots of tribes that fight with each other.” ([48:30]) — Balaji Srinivasan
• “You want to get to a place where you trust the people around you.” ([58:07]) — Balaji Srinivasan

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Timestamps for Important Segments

• [00:42] California’s hollowing out and the “meta organism” concept
• [03:35] “Democrats destroyed democracy in California”
• [06:24] State as startup (NGOs/homelessness as economic engine)
• [08:39] Voting with your feet as the only real democracy left
• [15:07] How Silicon Valley & China drive deflation
• [22:04] U.S. inflation vs. Chinese deflation — “vector not scalar” explanation
• [24:07] U.S. housing bubble and the impact of $1.25 trillion money printing
• [25:57] “Inflation is taxation without legislation”
• [30:24] “America doesn’t exist” — polarization and the split of blue/red America
• [33:02] 4% cross-party marriage—polarization becomes biological
• [33:34] “Soft secession” and blue state noncompliance
• [37:14] Newsom and California’s alignment with China
• [40:40] Mark Carney, Canada, and the blue-state/China alliance
• [46:06] Lessons from historical disunion and Civil War
• [51:48] COVID as preview of hard borders and interstate compacts
• [53:37] The three-way fight: Red, Blue, Tech America
• [57:37] How “American” will mean Republican American/Latin American vs. Blue American/Canada
• [58:07] “Eye of the hurricane” strategy and relocation advice

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Flow & Tone

Throughout, Tom and Balaji keep a rapid, idea-rich pace, frequently referencing data, historical analogies, and contemporary examples. Balaji’s tone is analytical, occasionally caustic, but never purely cynical—he insists the solutions are practical (migration, community, building tech-driven alternatives) but warns the stakes are existential. Tom pushes for clarification, drawing out complex issues without losing critical or controversial edge.

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Conclusion

This episode paints a vivid, sometimes chilling, portrait of America’s future: a nation morphing into rival political, economic, and technological “tribes,” with power shifting between states, digital spaces, and international actors. From one-party rule in California to blue states aligning with China, and the relentless logic of “meta organisms,” listeners are challenged to reconsider almost everything they know about U.S. politics, the economy, and their own survival strategies in a deeply disrupted world.

Transcript

[Balaji Srinivasan]

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[Host/Interviewer]

Welcome back to part two of this incredible conversation. Without further ado, here we go. Do you think California has a rude awakening coming where they've just hollowed out like a trillion dollars of their tax base, or are they doing it to be punitive and believe that they can make up the shortfall through federal funds? Like, I'm not sure what their logic is.

[Balaji Srinivasan]

Ah, there's a meta logic to the meta organism. So meta organism, another important concept to have. It's certainly not original to me, but you know, an ant colony, any individual ant doesn't necessarily know what it's doing. But the colony has an intelligence. Doesn't mean it's super intelligent. It just means there's an emergent intelligence where you can talk about the colony's interests, even if any individual ant is only kind of responding to local incentives. Similarly, a flock of seagulls or a school of fish, there's meta organisms even, in a sense, you as a human being, you have a collection of cells and your epithelial cells don't necessarily know what's going on, but they obey your orders in a sense, right? If we model Democrats, California Democrats as a meta organism, Republicans as a meta organism, there's a bunch of individual sensors and they're not super intelligent.

[Host/Interviewer]

But.

[Balaji Srinivasan]

But this way you can say, blue wants this, red wants this. Okay? Like at an abstracted level over millions of people. California Democrats, basically, the wealth tax is for them a win win. Why? They either deport or rob their main competitors for political power within California. Who are the tech guys? That's fucking dark, right? This is the same as the Communists, right? The Communists, like they would take control of Cuba and all the capitalists, they either rob them or they'd force them out at gunpoint, be exiles in Miami. And there's a meta rationality to this, which is the kind of person who's a Communist or a California Democrat is somebody who's not good at winning in the market. They're not good with numbers, they're not good with building businesses, but they are good at is coalitional politics. They actually have a real, for lack of better term, talent for that from somebody who has that talent. And they can't build a business, they can't build wealth or what have you. What they can do is they can focus 100% of their energy on controlling the law and the state. And the tech guy can't do that. They go upstream and they basically win the high ground and they drive out their enemies or rob them. And every tech zillionaire who leaves California basically cements Democrat political power because at a deep sense, and this is a really important, another important concept. Democrats destroyed democracy in California. And the reason is California is a one party state. Let me show you this. Okay. Do you see that? Yep. Yeah. Democrats destroyed democracy.

[Host/Interviewer]

That's wild.

[Balaji Srinivasan]

Okay. California is a one party state where elections are held but the party always wins.

[Host/Interviewer]

That is crazy. For anybody not looking at this, it shows that every year from 2011 to. Well, I guess technically that's what we see. It's 92 to 2024. Governor, state, go ahead.

[Balaji Srinivasan]

Let's say 2011 to 2025. It's just pure Democrats. And the new gerrymandering bill is going to mean permanent Democrat rule forever.

[Host/Interviewer]

Jesus.

[Balaji Srinivasan]

Okay, Schwarzenegger was like the last Republican.

[Host/Interviewer]

So what year was he? Oh, so he ended in 2011.

[Balaji Srinivasan]

Yeah, yeah. Okay, that's right. That's right.

[Host/Interviewer]

So he was the last1. So 22 last time that we had.

[Balaji Srinivasan]

Wow, that's right. And so then going a little further, basically it was right around then that California started topping out. And basically one party democracy is why you can have graphs like this. Do you see this graph? It shows the Department of Homelessness budget.

[Host/Interviewer]

Jesus. Yeah.

[Balaji Srinivasan]

So this is the thing, like lots of people who are like, you need to stay and fight. We need to fix California and so on. The thing they don't understand is that for Democrats, the state is their startup. So here's a specific example. The purpose of the San Francisco government for Democrats is, is to award hundreds of millions, in this case, more than a billion dollars per year to quote homeless NGOs that hand out the syringes and set up the safe injection sites, so to speak, to get people addicted to drugs to increase the homeless population and thereby increase the justification for their existence. Whether they conceptualize it that way or not, they'll say they mean to do good, but they really mean to do well for themselves because what they're optimizing is the NGO budget.

[Host/Interviewer]

This is a really important mechanism and I don't want to lose people from a political angle. So taking that out to the mechanism that recurs in the human mind is every human, every organism, when we get together, is going to try to grow. And when humans get together to build something, whether it is a local government, whether it's a company, they are going to, they have an incentive structure both inside their own mind and just at the ground level of getting resources to survive, to make it bigger, to grow, to acquire more resources. And so if your homelessness project requires homeless people, then the thing that you have to acquire more of in order to grow is homeless people. That is really fascinating. It goes to show at an incentive level how high risk this kind of thing is.

[Balaji Srinivasan]

Exactly. And so the Republican version of this is like the military industrial complex.

[Host/Interviewer]

Well said, well said.

[Balaji Srinivasan]

Okay. So that is the piece of it for which the state is their startup. And so in both cases it's smaller than the other piece, but it's still trillion dollars or what have you. Right? And so when you see this, you realize, okay, those people for whom the state is their startup, like it is their full time job to gain power so they can gain the money. Like basically their NGO budget or their military industrial complex budget to a lesser extent, but certainly let's say the NGO budget, the grant or something like that, there's a good phrase on X on this, their net long taxation. Taxation on balance is good for them because they might lose 10,000 bucks a year or whatever as for their bureaucrat salary, but they gain $20 billion a year to be able to throw around and allocate because there's more that is being controlled by the central government. Right? So and when you actually tote up how many people are downstream of the state in one way or the other, you have like 40 million people on Snap. You have all the academic grants, you have all the NGOs, you have all the bureaucrat positions. It's much larger than the federal government per se. It's all the flows of money that go out to things that are directly or indirectly government, state, local, federal funded, okay? Because of that, anybody for whom the state is their startup, you're not going to beat them. Or rather it's a miracle if you ever do beat them because it's their full time job and it's like your part time job. So the California tech guys cannot win against the people who the state is their startup right now. In response, by the way, California Democrats creating a one party state in California. Republicans are trying to do the same thing in Florida and Texas. And of course China's also one party state. So democracy is ending within states. The gerrymandering and so on is also meaning that there's response gerrymandering in Republican states as well. Right. Virginia's gerrymandering for Democrats, California gerrymandering for Democrats. Florida and Texas are trying to do this for Republicans. Right. So essentially you get an equilibrium where you have all of these one party states where elections are held, but the party always wins. And so that means democracy is actually going to be between states rather than within them. You have to vote with your feet, you have to move between states. That's the only practical choice you have. Right. So the Internet becomes a guardian of true democracy because people vote with their feet, with their wallet and their ballot. That's actually how you have a choice of the government under which you live. It's a more expensive vote in a sense. But we can reduce the barriers to exit, we can reduce the cost of migration and so on with the Internet. Okay, so coming back up, once we understand these dynamics, the issue is that all of the debt is causing. Because the thing is, Democrats were actually much more reasonable in the 90s and the 2000s and so were Republicans because they weren't under the same financial stress. Their pie has shrunk. Like people feel that. Right. The pie is shrunk. They have to work harder for less. The dollar has declined in value because basically it's hard to go up from where America was in the 90s. It's the most dominant empire of all time. Many people thought that America would then be able to essentially run both Russia and China. And in fact in the 90s, Yeltsin and so on, Americans could do business. And Russia was actually part of the so called G8 up until the 2000s and then they got kicked out. But Russia was a place where Americans could do business. And certainly many in China sent their children to American schools and Americans could do business there as well. So there's an expectation in the 90s and the 2000s that it was the end of history. I know Fukuyama's has a more sophisticated thesis than that, but that's part of his thesis that basically liberal democracy, capitalism had become dominant. So there's an expectation that you could graduate from college and while it wasn't articulated such at a meta organism level, you could administer a province like Siberia or Shanghai, just like you could South Dakota Right. Essentially the American empire would run the world and you'd have expansion territories to go into. The fact that that didn't happen and the fact that Putin and Xi and others rose since those territories got closed off to Americans abroad and that the Internet arose domestically and started disrupting opportunities at home meant that the Democrats, Republicans are getting squeezed from both sides. That's like another. To be clear, this is complementary to the whole debt thing, but it's just another way of thinking about what the last 20, 30 years were. And so what happens is in 2008, China and the Internet weren't ready to take over. They were still intuit but the financial stress and that's why people fled into the dollar. At that time you heard the term the cleanest dirty shirt. For all the faults of the US at that time it was still, where else are you going to go, right? So people flooded into the dollar and with that financial crisis, basically they're able to print and kind of keep the system going because who is ready to take it over? One way of thinking about it is when a human dies, they can die without an error, but when a system dies, it has to have an obvious error. Otherwise it can't die because they'll just continue in a zombie state. And so the last 18 years have kind of been like zombie America. Like that graph that shows the Magnificent Seven versus S and P 493, you know, you know how General Motors got a bailout in 2008, right. And the banks got a bailout. Right. Those are companies that like should have died. And they basically are essentially, though it's not called this, they were nationalized at that time because the government bought stakes in them. Right. In fact, the government nationalized much of American property because all of the. And this is going to be an argument that you're probably going to see in the next, whatever number of years the government owns your house. Why? Because the Fed bought mortgage backed securities, therefore like you should be grateful to them and so on and so forth. Okay, so much of the economy was de facto nationalized at that time with the purchase of mortgage backed securities, the bailouts of the banks, the bailout of General Motors, the American Investment Recovery act, and so on and so forth. All this was using that money printing power to basically tax the whole world to bail out America. And that's why Britain, for example, their growth just stopped in 2008. I don't know if you've seen that graph that shows like Britain's GDP growth, it just like stopped then because they're remember the Cantillon effect. The Brits are further from the money printer than Americans are. And so the only two districts that did well in America after the financial crisis were basically the broad D.C. area, which got a lot of the bailout money and the banks and so on, and Silicon Valley, which could do a lot with a little like just a guy on a laptop. One tiny rivulet of all the printed money made its way down into. Because interest rates had gone all the way down, people for any return, they did take high risk. They take much higher risk than they needed to do during the post war era. They started to finally invest in risky things again like they did in the 1800s. And, and a tiny, tiny sliver, like a few billion dollars out of a few trillion made its way to Silicon Valley tech startups and it funded Zuck and Elon and so on and so forth. And that's another big piece of this is the Internet was ready for that at that time. So relatively small amount of capital miracle grow, this system started getting stood up. And the same thing was happening abroad in China, where they were also willing to do more with less. Right. They were willing to. Have you ever seen a Chinese factory online and stuff?

[Host/Interviewer]

Yes. Not in person.

[Balaji Srinivasan]

Okay. So like they have dormitories there, right. They sleep at the factory. They basically will, you know, they'll go back for like Chinese New Year. You know, this is big migration. They, they go and see their kids, wife, whatever, once a year and they come back and they grind in the factory. Right. And because it was such a huge improvement over the rice patty of communism, like they were just happy to have four meals in a cot. This was amazing for them. It was a huge level up over the poverty they had.

[Host/Interviewer]

Anybody that remembered Mao would have been ecstatic.

[Balaji Srinivasan]

Yes, that's right. So for them this was a huge level up. They were happy to have it relative to what they had. Right. So they weren't feeling oppressed or whatever. Right. I'm not saying, you know, I'm not totally romanticizing it or anything like that, but basically something that would have been considered a huge level down from work conditions for many Americans was a huge level up for many Chinese. Right. So they were also the equivalent of the guy on a laptop who didn't need much in the way of resources, doing a lot with a little. They were willing to do a lot with a little in China and places like that. Okay, so those two deflationary forces basically are kind of what? There's a graph that shows what increase in price. And what decrease in price? Have you seen that one?

[Host/Interviewer]

Over what time period?

[Balaji Srinivasan]

Like the last few decades? Let me see if I can find it.

[Host/Interviewer]

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[Balaji Srinivasan]

Yeah. And by the way, the thing is, I would agree with everything, you know, it is, it's one of these things where China's complicated. I mean just like America's complicated, where a lot of the negative stuff and the positive stuff is true. Like did they copy all types of stuff? Yes. Did they violate all kinds of ip? Absolutely. Do they have elections in the sense that Americans had them? No. Do they like, do they have a surveillance? Absolutely. All this stuff is true, Right. But they also execute like it's this weird thing. Where do they have for example, low quality plastic stuff and you know, absolutely true. On their hand are your phones. Are the pieces of them made in China? They. They are, right? Yeah.

[Host/Interviewer]

Tim Cook talked about that. He said, listen, I don't know who keeps saying that you go to China for low quality manufacturing. He's like, these are the like highest, most high tech engineers that you're going to find anywhere. Now the part he left out is that he's one of the people that taught them how to do it. But nonetheless, they really have accomplished something extraordinary. They are a very complex picture. Give us the punchline of what we're looking at here. And then I want to ask you about what you think the US's strategy is like. I get you are like, look, America has already died. I don't even know what we're talking about here. But America is trying to, to outperform China, at least in our own hemisphere. We're at war right now with Iran. So I'm very curious, once you show us this, what you think of what you do next.

[Balaji Srinivasan]

Yes, okay, fine.

[Host/Interviewer]

Or what we are doing, is it working or should we be doing something different?

[Balaji Srinivasan]

Okay, so let me first show this graph, then let's talk about that. Okay, so first this graph shows inflation and deflation. And the crucial thing is it's a vector, not a scalar. That is to say, you have to. It's not just like one number that you quote for inflation. You're like up 40% in college tuition, but you're down like more than 100% on televisions. Right. And basically, if you look at this, everything that China and or the Internet touch has come radically down in cost. Televisions, personal computers, phones, toys, cell phone, clothing, all this stuff is either made in China or on the Internet or both. Right.

[Host/Interviewer]

Balaji, this is really, really insightful and something that is falling through the cracks in the public narrative about what's going on. It's very damning, I would say, to see the things that China has touched have gone down and then all the bureaucratic nightmares that we've created on our side are driving costs up.

[Balaji Srinivasan]

That's exactly, that's right. So the things that are going up are all the things the American state is touching, which are, right, Education, health care.

[Host/Interviewer]

Right.

[Balaji Srinivasan]

Like, you know, everything that is regulated by the US government is going up in cost because in many ways Keynesianism again is communism for wimps. So the point is, and to understand at a system level there, there are always short term costs to disruption. If you were to. What does it look like to disrupt education? Well, all kinds of universities and schools go out of work, teachers go out of work and so and so forth. But you have hyper deflated cost of education. So the system will fight that because there's millions, there's teachers unions. Universities are very powerful political actors. Right. Similarly, like real estate, Trump has actually said he doesn't want real estate prices to go down. Xi in China. Go ahead.

[Host/Interviewer]

I Just said don't get me started. That one's a wind up for me.

[Balaji Srinivasan]

Right. So that's why literally Fed policy for last few for a long period of time has been to prop up housing prices. And in fact, if you've seen the so called Case Shiller index, right, like it is actually beyond where the housing price bubble was. Right?

[Host/Interviewer]

Yeah. This is going to make me mad. I can already tell.

[Balaji Srinivasan]

Yeah. So, so look at this. This bad boy, here we are, this was the so called mortgage bubble and here's the crash. And look at how much we've mooned since then.

[Host/Interviewer]

That is crazy.

[Balaji Srinivasan]

So we're due for something that's much, much, much bigger than 2008 unfortunately. Right. And the thing about this, just to just to show this is it's an unusual article that is actually very explicit about how like the connection between the money printing and this. So how did this happen? Well, this article from NPR of all places in, in 2010 back when they printed some true things. Haha. Okay, how to spend 1.25 trillion. So these two people are at the Fed and how do they spend 1.25 trillion? So they basically. Let's look at this. Ready? They just hit a button. They told us they were $0.61 short. They bought $1,249,999,990,909 $39 worth of mortgage backed bonds. The Fed was able to spend so much money so quickly because it has a unique power. It can create money out of thin air whenever it decides to do so. So the mortgage team would decide to buy a bond, they push a button to the computer and voila, money is created. Wow. They actually get rid of all of the obfuscation, all the stuff about. Go ahead.

[Host/Interviewer]

No, it's right there, it's just right there.

[Balaji Srinivasan]

Okay. So it has unique power, it can create. So this is as Milton Friedman said, inflation is taxation without legislation. Now by the way, $1.25 trillion, just to put that in context, I mean you're an entrepreneur, right? You sold the, was it the protein or health bars? Yep. Right.

[Host/Interviewer]

Quest.

[Balaji Srinivasan]

Okay, yeah, Quest. Quest bars. Which, great. Now a trillion dollars. Imagine selling $1,000 worth of quest Bars to everybody in China. That's what a trillion. A thousand times a billion is a trillion. Right. And obviously that's, that's a trillion in revenue, that's not a trillion in profit. Like what are your actual margins on those Quest bars? I don't know, like whatever percent it is. Okay, so this was a trillion in Profit and instantly with no, by hitting a button. Right. So the time expenditure, the labor expenditure, the profitability and the invisibility of it. Right. Nobody even understands that this is happening.

[Host/Interviewer]

That's the problem. Even people hearing this right now, I know some percentage of them do not understand that that is the worst thing in the world, that that is taking money, it's taking purchasing power, but you might as well think of it as taking money from you. It's absolutely insane. All right, Balaji, you just put a really important piece on the table that I'd never considered very powerful. Look at China through a totally new lens. Certainly the housing market is terrifying. Now walk me through. So the US from where I'm sitting, I can paint you a picture of the moves that Trump is making. Have everything to do with China, very little to do with Venezuela, very little to do with Iran. And it is an American empire in decline that realizes that it has to establish itself as the dominant power basically anywhere that it can. I think it's given up. You already touched on this. I think it's given up on the Southeast Asia. It's just like that's going to be China's neighborhood. But we're going to lock down South America, we're going to lock down North America. And. And because he's running, as far as I'm concerned, a do or die strategy with the economy, where he's going to spend and inflate the currency like crazy, devalue the dollar, do the whole shebang, and his only chance out from under that is to grow. And so when he looks at the Middle east, which has aggregated just an unbelievable amount of capital he went early on in his second term, he got $2 trillion roughly, in deals. But he knows that that's contingent on a stable Middle east where the Strait of Hormuz isn't being choked out by the Iranians, where the Gulf states that he's getting these contributions from, they don't have to hold that money back to repair a desalinization plant or to deal with other oil infrastructure that Iran has bombed into oblivion. So when I look at the move that he makes, I'm like, oh, this is him trying to make sure that he doesn't go to jail, effectively, because I think if he gets impeached or if he loses the midterms, he will get impeached. Once he's out of office, they will hound him until he is in prison. So I think for him, this is existential, and I think he understands, okay, I've got That wind in my back. And then I also have to deal with the fact that we've got to quarantine China somehow. And so by means making their unsanctionable oil impossible for them to grab. It may only be 20% of their oil, but it's better than nothing. And so you put all that together, and that to me, explains the behavior that I see on behalf of America right now. Do you see something different or does that map for you?

[Balaji Srinivasan]

I understand where that's coming from, but I would say I do see a fair amount different, and here's why. First is, I think the word American is like the word Korean. And when you say Korean, I think one has to distinguish immediately. Is it North Korean or South Korean?

[Host/Interviewer]

Yo, you're saying something here, Balaji. All right, say more. I know where this argument goes, but let's hear it.

[Balaji Srinivasan]

Yeah, so the thing is that when one says American, unfortunately, like, you know, when you and I grew up, you know, when we were kids, you'd say, I pledge allegiance to the United States, America, and to the public, which stands one republic, indivisible, with liberty and justice for all.

[Host/Interviewer]

Right.

[Balaji Srinivasan]

And the unfortunate thing is, and I can show chart after chart on this, but it is actually so polarized that America doesn't exist. There's blue America and red America and tech America and all these different sub tribes within it. Just to show you some graphs on this, I'll show you three. Okay, so there is this graph which shows Congress polarizing before Trump even arose. Okay. This is like, you know, 2015. Okay. So I'm not sure if you can see that, but each you see 1965 and 1995, how it, like, comes apart like this. Yep, very clear what you're seeing here. Each node is a congressman. Blue is Democrat, red is Republican. And in the 1960s and 1950s, an edge between them means they voted the same way on the same bill. Yes together or no together. Okay. After 1991, without the Soviet Union as a common enemy, to keep the US Together, the only people Democrats and Republicans had to fight was each other. And so they politically polarized.

[Host/Interviewer]

Okay, this is crazy to see it like this.

[Balaji Srinivasan]

Yes. So it's quantitative. Right. And this is something which has gone on for 70 years. It's not like a short term thing. And then what happened was this actually extended from Congress to the population. So that last graph was 20. That was up to 2011 and was calculated in 2015. This is a totally different graphic that shows the same concept, but it's on Twitter and You can see blue nodes and red nodes. This is 2017, right? As Trump was elected. And blues just don't friend reds and vice versa. They don't even follow the same kinds of groups.

[Host/Interviewer]

That is crazy.

[Balaji Srinivasan]

Okay, so this is 2017 and you can see the mitosis happening. By 2025, the digital secession was already here, where blues are on blue sky and they're on threads and they're on, you know, TikTok. Right. And reds are on X and they're on truth social and gab and whatever. Right. And so the, you know, Americans like blue sky and truth social, they're both speaking in English, but their entire worldview and premises are completely different. As different, I would argue as like North Korea and South Korea, you know, or becoming as different. The digital split has already happened where Democrats and Republicans, they don't talk to each other, they don't marry each other, by the way. So like, that's another thing. Democrats, essentially only 4% of Democrats marry Republicans.

[Host/Interviewer]

Wow.

[Balaji Srinivasan]

Okay, so this one. Yeah. So here's this graphic. Ready? So what that means is if you see this, marriages between Democrats and Republicans are rare. Between Democrats, this study shows 4%. Okay. That means ideology becomes biology in one generation. Like it's like an ethnic split, right? It's at a minimum, Protestant, Catholic, Sunni, Shiite, is Democrat, Republican.

[Host/Interviewer]

That's a crazy statement, Balaji. Those groups kill each other.

[Balaji Srinivasan]

Historically, unfortunately, yes. And that's what's like basically, for example, this Minnesota confrontation that happened earlier this year was these two clouds getting printed out in the physical world. Why were the Democrats running around looking for ice? Because the blue meta organism wanted to fight the red organism in physical space. Finally. And it's not like Democrats are actually against the concept of strong borders and mass deportation. Why? They wanted to deport ice. ICE out. Right? They wanted Republicans out of Democrat territory. Okay. And so for example, there's this concept that has been going viral on Democrat channels called soft secession. And basically it's taking all the. It's time for Americans to start talking about soft session. Blue states are finally learning, but red states have known all along you don't need federal permission to govern. So invoking all the 10th Amendment rhetoric, war gaming scenarios for federal agents show up, continue to transgress further and further past what is legal. Right. And so essentially Democrat governors are filing lawsuits and so on to basically three sources between Democrat ag, say the same phrase keeps coming up that nobody wants to say publicly. Soft secession.

[Host/Interviewer]

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[Host/Interviewer]

Thanks for sticking around. Let's get right back into the action. What. What exactly would soft secession be?

[Balaji Srinivasan]

For example, Newsom has said he does not want to enforce tariffs on China at California ports.

[Host/Interviewer]

Whoa.

[Balaji Srinivasan]

Okay. So because that is a. If you think about what that means, that is a way for him to have like a left populist thing versus Trump, right? And he can reduce costs, in theory, in China, in California by taking Chinese goods. And actually so this is the thing that I don't think people fully get is you're going to see you actually are already seeing Democrats lining up with China more. Right? For example, just to Just be very concrete about this because I'm not saying this as. Oh, it's, for example, in 2023, Newsom actually made a trip to China and he's actually the only Democrat who actually was able to sit on stage with Xi. And there's this long set of articles and so on where what Newsom said is, he wanted to, he said this quote, is willing to be China's long term, stable and strong partner. Right. Welcome. More Newsoms to come. Okay, this is not an isolated article. It's like, welcome to Newsoms to come. Newsom willing to push California to be China's long term, stable, strong partner, strengthened relationship, California government, China success to benefit the world. Right. And the thing is that even in 2023, there's a 20 point gap between Democrats and Republicans on China where Democrats want to cooperate more with China than Republicans do. It's roughly like Republicans more sympathetic to Russia, Democrats more sympathetic to China. Roughly. Okay. And so as a consequence, you know, you're going to see. I thought it was going to happen with Newsom first, but it actually happened with Carney in Canada first. The Western left has lost DC so turns to Xi. Yeah. And so the immersion effect. Remember I talked about the force diagram. Right. Democrats are driving the tech guys out of California, out of Seattle, and they're going to bring in Chinese money in

[Host/Interviewer]

apology. One thing that I've always been, I've always struggled with with your philosophy is the geography doesn't matter part of it. Now, seeing some of the things you're doing with the network state, I think maybe either I misunderstood your philosophy or you've come to my side, which is that the physicality of it really does matter. Walk me through how America breaks apart if this continues.

[Balaji Srinivasan]

Yes. So the thing about network state and so on is it's cloud first, land last, but not land never. Got it. So say you start with an online community and then you crowdfund territory, because of course we're physical beings, but the land is just a parameter. That's to say, if you hold an impact theory conference, does it matter that much which city it's in? No, the community matters first. Cloud first, lan last, but not land never. So first they see you online, they click the thing, then they come to the physical location, but that's secondary and the community's primary.

[Host/Interviewer]

Okay, understood. Now give me.

[Balaji Srinivasan]

Now, how does that apply to America?

[Host/Interviewer]

Yup.

[Balaji Srinivasan]

Okay. So my view is Mark Carney. His speech earlier this year was the most important speech since Trump came down the escalator in 2015.

[Host/Interviewer]

Damn.

[Balaji Srinivasan]

And the reason is that Trump basically said that the west is losing to China. And Mark Carney basically said, whether you agree or not, the west has lost to China. So Trump was basically, we need to push back. He was kind of like a turnaround CEO. There's a term used in the first term which was the Flight 93 administration or the flight, the Flight 93 election. Do you remember that?

[Host/Interviewer]

I remember Flight 93. I don't remember this statement about the administration.

[Balaji Srinivasan]

The, the argument for Trump in the first, the first term was there's an arg. Basically an article in Claremont which was called the Flight 93 election and basically said conservatives would always say the country's going to hell in a handbasket. But if you actually see what's happening, it really is, we need to hit the emergency button. And Trump is that emergency button. Now, many didn't agree with this at that time and they felt that Trump was a radical move that wasn't necessary. But the condition of the US has worsened since that point and some will argue whether it's due to it or whatever. I mean, there's truth to all of it. Okay, point being this in many ways is the sequel to that. This is a Flight 93 administration. They've rushed the cockpit. But is the plane still going to crash? Unfortunately, I think it is. I think it's not something where not everything can be saved. Like, it's something where, like Rome did fall, unfortunately. Right. Like the British Empire. The sun did set on the British Empire. There's certain things where the late breaking, turnaround kind of thing just doesn't work and it hits the ground. Okay, so what do I think happens? I think what's already happening, Carney's Canada is like a land bridge where if you visualize it, there's Washington and Oregon and California, the Great Lakes states and New York and the New England states, and basically all the blue states border Canada. And what Trump said is that he doesn't want Canada to become a drop off point for Chinese goods. But that's exactly what Carney is doing because he basically said that he's going to take away tariffs on Chinese EVs. But more than that, he also said, and this was missed, that he's going to essentially allow the supply chain. What does that mean? It means that he's talked about we're going to add all kinds of electricity to Canada. Canada has too many regulations or whatever to do that historically, but China can do it. So the Chinese are going to build the Canadian electrical grid. Also, he is if you notice Carney is suddenly much more confident when he's talking about Greenland and things like that. He said if, you know, there's an actual military action, Greenland. And we can't tell if Trump is kidding around or what have you, or he's serious about it. Sometimes it's hard to tell, but Canada and NATO treat it really seriously or they're scared of it. Fine. And also Trump said he's going to invade Canada. That actually, I don't know if you saw the graph on that. Basically the conservatives in Canada were ahead. Yeah.

[Host/Interviewer]

This is fucking stupid.

[Balaji Srinivasan]

This was stupid. Right? So conservatives in Canada, we're way ahead. And then Trump said he's going to invade Canada. And the problem is he had already lost the liberal Canadians and the liberal, you know, Americans, but then he lost the conservative Canadians as well. And Carney just suddenly won. Okay. Yeah. So the thing is the speculation, because Carney hasn't said this publicly, why is he suddenly so confident? He said if there's any invasion of Greenland, then, you know, like Canada will resist that because you'll have Chinese drones.

[Host/Interviewer]

It's wild, man. That is wild.

[Balaji Srinivasan]

And so the. And you know, like you can see Democrat influencers like Hassan, he's talking about China maxing on his Twitter, you know. Right. So there's a. There's a sense like Scott Alexander. Yeah, right. So now the thing about this is Scott Alexander has this good concept of in, group, out, group, far group, where basically it's another way of saying your enemy's enemy is your friend. So Democrats think their primary enemy is the Republicans and the Republicans enemy is China. And remember, the Democrats are like a information kind of thing and the Republicans are like a physical manufacturing thing. So the Democrats are getting a new husband who's XI instead of DC that'll provide all the physical stuff, the manufacturing and. And so on the Democrats are less good at. Meanwhile, Democrats are.

[Host/Interviewer]

How would they actually break apart? Like if, right now, if California tried to secede while Trump was in office. Military incursion guaranteed. So.

[Balaji Srinivasan]

Well, just take a look what's happening with ice, right? Like basically is that it's like a half military incursion. But is it working? Not really. Right. Kinda. It's not. Like the thing is it's all like a slap fest. Right? It's not.

[Host/Interviewer]

This is a hard thing to. This is all early days. I want you to imagine that let's say that these states do start breaking away, much like the UK learned the hard way when you're not a part of Europe Things don't get easier, they get harder. Very good point.

[Balaji Srinivasan]

Yes. So actually there's a great book called Disunion. Okay. It's actually about the American Civil War. And the title of it is very good. And even just you can read the first few chapters and it just made something clear that you sort of read in a dusty way in the history books. But I didn't fully viscerally understand it till I read this book. And you know how people. The modern American interpretation of the Civil War is it was about slavery and the south wanted to have the slaves. And that was absolutely an important component of it. But you'll often hear people also say something like, Lincoln wanted to preserve the Union. Right. You've heard that. That feels very abstract. Right. What was the concrete thing? The concrete thing was many Americans had come from Europe and they'd seen all the wars in Europe. And the wars in Europe arose from the fact that Europe wasn't united. And because it wasn't united, you had all these guys fighting amongst each other. And so Disunion was considered to be this crazy thing the Southerners were trying to that would lead to a fragmented bunch of states in North America that would fight each other, tax each other, they would lose economies of scale, that would fight each other, tariff each other. Basically they wanted the economy of scale and the peace that came with the Union. For them, the Union meant peace, it meant prosperity, it meant unity, it meant a large free trade zone. It meant the opposite of all the chaos and fighting that they had in Europe. So in other words, in the same way a lot of tech guys today think of decentralization in almost a quasi religious way. It is good to decentralize because it means freedom and personal sovereignty and so on and so forth. Right. At the time, these guys thought of centralization as good in a quasi religious way because it meant order and stability and. And scale and strength, as opposed to the anarchy of Europe. Because there's centralization and decentralization cycles in history. Once you're totally centralized, you want freedom and so on. And once you're totally decentralized, you're like, oh, this is anarchy. I want order. The Chinese have a saying which is like the empire, long united must divide, long divided must unite. Because they've been through many of these cycles in their history, Right?

[Host/Interviewer]

Sure.

[Balaji Srinivasan]

And Europe has as well. But it's like breakup of Rome, rebuilding, breakup, unbundling. They just call it different names. Okay. Point being that Disunion was something that the Republicans of the time opposed. I mean, you can Argue the party switched sides. They switched sides multiple times, whatever. But they opposed it. Once you can articulate their case for it, it's like the case against the 10th Amendment. It's a case that you should have a strong union, because otherwise, as you point out, like, think about Russia, Ukraine, they used to be part of the USSR and now they're not. And talk about losing an economy of scale. They're like killing each other by the hundreds of thousands, maybe the millions, spending billions and billions of dollars on something which within our lifetimes was a border you could just drive across and nobody would care at all. I mean, it wasn't that easy to drive in the Soviet Union. But you understand my point, right? That was simply not a conflict zone. But by decentralizing, it created one. And actually you realize this when you realize, think about how many countries have united or union in their name. United States of America, it's not a country, but the European Union, the Union of Soviet Socialist Republics, the United Arab Emirates. Right. Even India, for example. Russia is called the Russian Federation today. India has a concept of union territories which are basically like, it's got a federal government. Brazil, all the stars on its flag are like the individual states. The United Kingdom. The reason that people put united in the name is that it's so hard to do. That's why they prompt you with the United States of America. The people who architected this. That's why Ben Franklin had join or die. You know, like, the people who architected this were really smart and they understood how artificial it was to maintain a union over huge numbers of squabbling people. By default, you have lots of tribes that fight with each other. That's also actually monotheism accomplishes the same thing where it's like one God rather than end gods. Right? So monotheism is centralization, polytheism, decentralization. Again, you have an oscillation between these two depending on where you are in history. Okay, so. So I'm granting everything you're saying, which is that a breakup does cause problems. Huge problems, massive problems. It reduces economies of scale. Like, but. But we've actually already seen a preview of this. You know, in 2008, like, the money printing became a preview for the decade to follow. Like the $787 billion bailout was this like, enormous thing, completely unprecedented. And then it became precedented. One of the things that happened during COVID hard borders arose between states. Do you remember? Like Rhode island and New York, like the COVID cross border thing. Like, even if the virus didn't actually abide by state borders. Nevertheless, you saw things that you had never seen before. Like people cared about the Rhode island, you know, border or whatever. Right. So like Russia, Ukraine, it was a complete, nobody cared about that border. Suddenly became a real border. Right. Another concept was like, you know, California was saying it wasn't going to pay for California legislators who went to red states because they disagreed with the social policies there. Right. Okay. Another is obviously the polarization we just talked about. Another is the, you have the mass migrations from blue to red states, huge exodus out of California. And that's similar to partition in India. Right. Huge migration from Pakistan. If Hindus went to India and Muslims went to Pakistan. Right. That's similar to the blue and red migrations. Okay. And I could continue on this, but one other key point that happened during COVID that people forget are the so called interstate compacts, which is a tool that exists in the Constitution. Basically state governors didn't want to wait for Trump to act at that time. So they formed like the Western States Compact, the, the Great Lakes Compact, the New England Compact. And it's basically breakaway things that were unprecedented but then became precedented. You can go and look at that. The interstates compact in 2020. So a lot of these muscles for hard state borders, interstate compacts, soft secession by Democrats, lawsuits against the federal government, left and right have been doing that. And at the social level, it's just been escalating, escalating. And I think a big problem with a lot of my American friends when I talk about this, when we talk about where is it going to go and so on, they have a mental model which says, don't worry, the pendulum will swing back. They have a model of homeostasis where it always comes back to an equilibrium like this. There's a different model. Have you ever seen the Tacoma Narrows Bridge in Seattle?

[Host/Interviewer]

I grew up in Tacoma. I've been on it many, many, many, many times.

[Balaji Srinivasan]

Fine. So Gallup and Gertie, as you're aware, swung from left to right and then harder to the left and harder to the right till the whole thing just collapsed into a million pieces in the ocean.

[Host/Interviewer]

Yep.

[Balaji Srinivasan]

That I think is a better model for what is happening now. Where if you go back and look at the 90s, I mean, you and I grew up in the 90s. Nobody cared about politics then in America. It was like that was like being interested in politics then was like being interested in the bus schedule. All people cared about were music, movies, sports, video games. It was just this amazing vacation from history. And you go back and you look and the Democrats, Republicans were on the same page about a lot of things. Republicans are much more moderate, Democrats are much more moderate. People go. And they will often use those old quotes to say what happened. Yeah, right. But what happened was the meta organisms upstream of them were nowhere near as desperate. Blues and reds. The meta organisms had much more of a food supply. They didn't feel constrained by China and the Internet as they did so because they didn't feel desperate, they could afford to be generous. Democrats didn't feel they had to tax everybody to oblivion. Republicans didn't feel like they had to be so aggressive abroad. They didn't feel like cornered. These meta organisms feel cornered, they feel desperate. They feel they have to strike out. That's a big part of what we're seeing. I'm very sympathetic and I'm empathetic to it, but I also want to be far away from it in the sense that one thing that's happening now is Blue America, Red America and tech America are all taxing each other. So Blue America is doing the wealth tax on Tech America, but it's also doing the China tax on Red America where they're allying with China. This is the Carney thing. Even though Carney is not technically a Democrat, he is aligned with them like the Western left, let's call it that. So the thing that tech guys prize the most, which is their businesses and their ability to innovate, Democrats are going after that. And the thing that Republicans prize the most, which is their country and their land, well, the alliance with China, which is burgeoning, they're going to go after that. Okay, what are Republicans doing to blues and to tech? Well, to tech, they're going after talent. They're stopping tech guys from assembling talent, which is their other lifeblood. Right. You can't bring talent from India, you can't bring talent from China anywhere near as easily as you could. All these visas are getting cut off and I understand why, but they're doing it. And what are they doing to Democrats? They're going after the thing that Democrats love the most, which is their global empire, like USAID or the NGOs, the universities, all the diplomatic relationships, the prestige abroad. That was the thing that Democrat diplomats built over generations. And Republicans are just gleefully like the un, they're cutting the budget. All these things that Democrats care about the most are dismantling that. Right. And then finally, what are tech guy's doing? Well, with AI, that's a jobs tax on Democrats. And then they're also decentralizing overseas and they're opening offices in other countries because they need the talent there. So all three groups, Red America, Blue America and Tech America are all fighting each other. And I think what happens is Blue America takes the west coast states and Canada and the Great Lakes and so on. Right. America takes like the Latin America. Right. Red America pivots to. I do think about what you said earlier. Bukele, Milei, Hernando De Soto. Like the understanding of American is actually going to change because it'll be like Democrat American and Republican American and the Republican Americans are going to lean. Like Bukele is much closer to DeSantis than Elizabeth Warren. Right. So the term American puts Elizabeth Warren and DeSantis in the same group and Bukele in the out group.

[Host/Interviewer]

Right? Yeah, right.

[Balaji Srinivasan]

But the actual correct grouping of conservative or libertarian or whatever you want. Right. Latin American has the Texas, Miami, Sunbelt, ish kind of region grouping with Bukele and Milei and Hernando De Soto and that feels like the actual ideological grouping. Whereas the cold and rainy Northwest and so on, that goes to the other side. Right.

[Host/Interviewer]

All right, Balaji, now that we understand all of that madness, what are the smartest people in the world doing about it?

[Balaji Srinivasan]

I would say so. I think you can take an eye of the hurricane strategy and eye of the hurricane strategy would be go to Texas, go to Florida and then you can also go to like many Americans have ancestry in Europe, like they're Polish American. You can get a Polish passport. Right. Saying you can take an eye of the hurricane strategy or you can get as far away as possible, liquidate, emigrate, accelerate. And I think actually location is much more important than allocation. I think you want to get to. Dalio also thinks this. I think you want to get to a place where you trust the people around you and there's like a community there. And I think that's what you should do.

[Host/Interviewer]

And do you have. You've talked about ascending and descending locations. Do you have like a rough swag of where in the world is on the way up, where in the world is on the way down?

[Balaji Srinivasan]

I think within the U.S. i'd say Texas, Miami are on the way up relatively. Right. Like you can actually build things there. So that's there. I think El Salvador is really interesting. It's a startup state. I think, you know, Southeast Asia, India are going up. I think Eastern Europe, obviously it's got the Ukraine war there. But if that dies down, like I think the vice grad states, Poland, Hungary, are doing quite well. I would have said Dubai and the Gulf, but of course, this Iran war has blown that up for a while. Sierra Firm has just closed off. And so the tricky part is there's no guaranteed safe haven. You have to be nimble and agile. But those are places that I think one would think about. Certainly those places that were off the map in the 20th century are getting on the map in the 20th. Okay, I got to jump. Thank you.

[Host/Interviewer]

Thank you so much, man. It was an absolute pleasure. Appreciate it. Okay, take care.

[Balaji Srinivasan]

All right. Bye. Bye.

[Host/Interviewer]

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[Balaji Srinivasan]

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[Host/Interviewer]

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