When I think of like the liquidity in the system starting to contract, it picks up pace and it starts to accelerate, which then requires them to put more magnitude to stop it and then push it back out again.
This might be one of the defining moments in history where that cycle could actually not play out.
And the one that wins in this battle is the one who demonstrates the most intellectual rigor.
I'm a little reserved.
I don't usually open up too much.
Well, you're doing great.
Yeah, well, you're doing great.
This was the moment in time where, like, we called each other and we were like,
what in the hell is going on right now?
But no, I wrote the whole book.
I sent it off to publishers and it was no, no, no, no, and no.
Tony Robbins reached out to us.
If you could sit every world leader for 10 minutes.
Yeah.
what would you say to them?
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Let's do this.
Preston, welcome back to All in Bitcoin.
Part one was just the beginning.
So here we are.
Part two, the world according to Preston.
Oh boy.
How good of a student were you?
I was a very late bloomer. My middle school years, I would say, were marginal at best. My last three years in high school, I got straight A's. I was a straight A student. I struggled with language. I had to work very hard extra overtime to get A's when I was in my 10th, 11th, and 12th grade year in language. In math, I didn't really even have to try. I just got A's.
What about history?
History.
You know what?
This is funny.
Most people that go to Surface Academies really like history.
I never liked history.
I still don't like history.
I somewhat like financial history only because it informs me as to now and the projections
that I'm doing.
But I've always found history kind of boring for the most part.
I don't.
You won't find me reading some type of history book.
I really.
It's just not my thing.
And it's interesting because I love trying to understand the future.
So if I was going to read a book and it was like, oh, this is where tech's going to be.
And I mean, that's why I do a tech show, right?
I'm very interested in now and the future.
I think it goes back to just how I like to operate inside of my environment.
I'm looking at like, I can't change the past.
Like why in the world?
like if I can learn something from the past
so that I can take action right now
and create the future
that's where I'm focused
so at West Point
they
I mean they cram
military history down your throat
I hated it
every second of it
when I was there
and I had most of my friends from college
they loved it
and I'm sitting there
this is terrible
like get me out of here
I could care less about all this
yeah
how did the diary of a West Point cadet
come about?
So my first deployment to combat, you're flying combat missions, you're working 13-hour days every day without a day off for the whole year you're there.
But when you're done, you've got the remaining couple hours in the day to do whatever.
And what I found a lot of people doing was they would just be watching movies on their laptop.
They'd go back to their little shipping container or whatever your little house or little cubicle
where you lived after your day of work was done.
People would go back, they'd open their laptop, and they'd watch movies.
And so I just kind of like the first month I was there, I was just doing this.
And I was just like, oh, my God, I feel like my brain is rotting just sitting here watching
TV.
It was just super brain dead to me.
And I was like, I've got to do something productive.
This is driving me crazy.
I felt like West Point's a super unique experience for college.
And there's these moments that are just really funny, like things that I remembered from my
time at school that were just silly or just weird or something that was nothing like another
college experience.
And I was like, maybe I should just write a book about these funny things that happened
to me when I was there.
The other thing, remember going back to this idea that I was terrible with language.
And so I wanted to improve my, I was a terrible writer.
It's just terrible at language in general.
And so I was like, how could I become better?
And I was like, well, if I write a book, like I'd have to become a better writer if I wrote
a book.
And if nobody reads it, whatever, I'm doing it to improve myself.
Okay.
So I come up with this idea.
I'm going to write a book instead of wasting my time watching these stupid movies.
I'm going to write a book.
So I sat down really simply and I was like, okay, like what's the top 15 funniest things
that happened or unique things, novel things that happened to me that, you know, an outside
person that didn't go to a service academy would find interesting or funny or whatever.
So I just started jotting down like different ideas and I was like, okay, I think I can just
turn each one of these funny stories into a chapter and then I'm just going to turn it into
a book. And so I took the first one that I thought was funny or whatever. And I was like, all right,
well, let me just like try to write a story. So I come up with an outline for that particular story
and then I just start writing it. And for the first time in my life, I actually enjoyed writing.
I'm like writing these stories and I'm like laughing inside, like reliving the moments
as I'm like writing it down.
And so I finished the first story.
I print it and I go to a couple of friends that I was there with.
And I said, can you guys do me like, I've got this crazy idea.
I'm like trying to write a book.
And they were looking at me like, okay, like this is going to be stupid.
And I was like, can you read?
This is the first chapter, right?
could you read this and tell me if this is crap, like seriously, tell me it's crap and I will not
feel bad. Like you won't hurt my feelings. And the one guy came back and he's like, honestly,
this was like pretty entertaining. Like it was pretty funny. And I was like, really? Like,
you're not just saying, he's like, no, seriously, it was, it was pretty funny. Like if you had
another one, I would, I would actually read it. And I was like, that was like, okay, well,
let me write another one. So I write the next story and I hand it to him and he was dying.
He was like, this is hilarious.
And so then as soon as he said that, I was like, I'm going to do this.
I'm like going to complete it.
I don't remember how long it took me, but I just continued to work on it for probably
another like for like six months.
Then I just like knocked it out.
And what was funny, so after I write it, you know, I had no idea like how publishing works
or any of that.
And, you know, lo and behold, it's kind of a small market for a book, like a book about West Point. It's kind of actually a pretty small market. There's only there's 10,000 people, 15,000 people that apply to West Point every year. So it's and then like a thousand get in. So like your market size is pretty small. And then the margins on books like really aren't that good.
so I take it to a publishing you know I send it out to a couple different publishers and I have
no social media account because they care about that nowadays because it's free marketing for
them right but I had no social media or anything so I send this manuscript I write the whole book
I send them in that's another thing I learned about publishing you usually write one chapter
and you say this is what the rest of it'll look like as a teaser and then they say okay that yes
yes or no and whatever. And then you write, then you actually write the book. But no, I wrote the
whole book. I sent it off to publishers and it was no, no, no, no, and no. And I was like,
you know, going back to this idea that no matter what, I'm going to find a way to get it done.
So I was like, okay, well, let me, let me search on, is there any, like, how do I self,
how do I self publish? Right? Like I can't find a publisher to publish this thing. So I guess I'm
to self-publish. How do I do that? So I start reading. And this was at a moment in time where
drop shipping, self-publishing, print on demand was just happening. And this is like, what year
is this? This is probably like 2008, I would guess. It was just a new thing, like a new technology
that you could literally order on Amazon. That order then goes to a fulfillment center. They
literally print the whole book and they drop ship it to the person that order it. And there's no
inventory required. Right. So I read about this and I was like, oh, wow, there's this whole like
print on demand thing that's happening right now. So I go and I buy, there was a couple of books
written on the topic. So I go and I read these books on the topic and I was like,
I can just do this. And I did. And sure enough, the book to my surprise shot is the, like the
number one selling book on West Point for the next few years after I self-published it.
That was my first asset, you could say, that I made. And I did that when I was in Afghanistan
on the side. I would go out and fly missions during the day. I'd come back, and instead of
watching movies, I wrote this book. So when did Bitcoin shift from an interest to a conviction
for you? So my first buy was in 2015. And I had invested in traditional stocks. And if they went
up 20% on the year, that was really incredible performance. And so 2015, the first buy was like
$220 a Bitcoin. And within a week, it was at $300. And I was like, what in the hell is this?
You bought, you didn't know anything about Bitcoin.
I had researched it and my thesis for buying it then is not too far off of the thesis of why I
own it now. Okay.
Like when in 2015, I was going back to this idea that when they were doing quantitative easing and all this stuff from the 2008 crisis, I was like, this is crap.
Like this is not solving anything.
I started studying Ray Dalio, probably 2013, 14 timeframe.
And he was the first person that made me understand the value of gold.
Because up until that, I was very strong opinion of Buffett, which is gold is stupid.
I don't even know why anybody would own it.
And I just mimicked that point of view.
But then I started reading Ray Dalio, and Ray Dalio helped convince me that there's
actually an importance to gold as a form of money, and you have these currency debasement,
that whole piece.
I studied that.
I couldn't say I deeply understood it, but I understood it enough to know that there
needed to be a reset to what was happening in the 2008 crisis was this manifestation
of this long-term credit cycle that Dalio talks about.
Like I understood all of that prior to buying Bitcoin in 2015.
So when I saw Bitcoin, I was like,
whoa, this is gold, but digital
and might actually even be better than gold.
So I buy it and then it goes almost immediately
from like 220 to 300.
And I was like, I need to read way more.
And so I started reading every book
I could get my hands on on Bitcoin.
What did you read in order to come up with that initial idea that this is kind of gold,
but even better?
Tony Robbins wrote a book called Money Master the Game.
That book helped me discover why Ray Dalio was an important figure and just kind of understanding
how he thinks.
I was really convinced with that book.
I was kind of like, whoa, I need to pay maybe more attention to this guy.
And then Ray had these white papers on the Bridgewater website, but his big debt crises
and these books that he's now recently published, these were actually PDFs on the Bridgewater
website back in 2013, 2014 that I downloaded.
And I read them and I was really buying into this idea of these long-term credit cycles,
like these 80-year credit cycles.
And when I was looking at that and I'm looking at what happened in the 2008 crisis, like,
holy, like we're at the end of this long-term like 80-year credit cycle.
And the central banks are doing all of these like crazy things.
And so it was really these pamphlets that Ray Dalio had published on the Bridgewater
website that I was reading in 2013, 2014, that convinced me that there needed to be
some type of new settlement layer that's going to replace the dollar.
and one of the things that I also remember
prior to me buying Bitcoin in 15
was interviewing people like Jim Rickards
who wrote Currency Wars
and Rickards' thesis, and he's a big gold bug
his big thesis was that the IMF
was going to use special drawing rights
and all these other things to basically recap
the global settlement layer
and I always found it to be interesting
because it was talking about World Bank, IMF,
and things that I was really struggling
to kind of wrap my head around.
Like, what are these organizations
and why do they exist?
So I was listening to records and saying,
well, maybe that's what resolves
this whole 2008 long-term credit cycle.
But I wasn't necessarily convinced.
And then I started hearing about Bitcoin
and then I did that first buy in early 2015.
But did you read anything on Bitcoin?
Yeah, there was a book called The Age of Cryptocurrency that came out.
I want to say maybe the end of 2014, that book came out, maybe super early 2015.
When I read that, I got quite a bit of conviction in Bitcoin after reading that book.
There was Real Vision videos that I remember watching.
People are familiar with Real Vision.
It's like a macro YouTube thing.
I watched a lot of Trace Mayer videos on Real Vision and things like that.
But the first book that I read on the topic was The Age of Cryptocurrency Because you were mentioning Ray Dalio but Ray Dalio has only recently spoken about Bitcoin
I've had conversations with Ray personally.
And I remember telling Ray, probably 2018,
I remember telling him, and I was a nobody to Ray,
just so everybody knows, like, who the hell is this guy?
I remember saying, you really need to look
the Bitcoin Ray and like, oh, okay. Yeah, yeah, yeah. And like, I was like, get this kid away from
me. I was listening to you at the time. But yeah, only more recently, I would say in the last two
years, you've seen Ray really kind of come around to it. I don't even think he's like that come
around to it. I think he still looks at gold as probably being a better way to navigate this,
which I totally disagree with him on. But I have to, I have to tell you, Ray is probably
the most important person in my life to find Bitcoin because of his long-term credit cycle.
If I didn't understand that, I would have never bought it in 2015.
What drew you into the Bitcoin scene and what made you stay?
Once I understood, once I finally pieced together that this actually solves for fiat
creating the incentive for violence, which took me a while to get there. Like I would say that
didn't even really hit my mindset until probably like 2020 or something. And then I started seeing
that side of it. And it was like, there's nothing more important for me to do in my life than to
educate people on this topic. And then, you know, I start going to conferences here and there,
and I start meeting the community and the people
and like why they're here.
And then I realized like the site picture
and all the different vantage points
of like why people are here
was way more profound than I had ever suspected.
Because people were here for privacy reasons.
People were here for, you know, what,
I mean, it's really robust
why all the different people were here.
And you see a little bit infighting within the community
as to like why this reason is more important
than that reason.
but collectively if you could just net all of that out and kind of look at it it's for people
that are looking at this from the outside in that maybe might not understand that let me tell you
it's a very diverse ecosystem of interest of like why people are in this space and i think that
that's one of the reasons why it's so powerful for me it's what you say it's very profound and
from outside i have a friend asked me the other day is that bitcoin like a sect and it's funny
because I understood where she was coming from.
Yeah.
And for me, it's so profound.
The only difference between this and a sect
is that at the top of that organizational structure
is not a parasite.
For example, yeah, it's an important one.
There's no hierarchy that leads to somebody
that's feasting on the brainwashed participants.
That's the difference.
But you have the vigor and you have the excitement
of a sect kind of in the space,
but they're there for the reasons
that are actually to solve
very corrupted problems in society.
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It took me a long time,
what you just mentioned before,
to unlearn so many things.
I wasted so much time.
So to explain where you come from.
I would hesitate there.
When I look back at my time in the military,
I could very easily say I wasted all those years. But honestly, when I look at those experiences and I look at what you're saying right there, I wouldn't have the conviction and the inspiration to work in this space without that hardship or feeling like I wasted my time doing those things.
That is actually the fuel or the engine that enabled me to see it, to have the conviction, to pour all of the energy that I got right now into it is actually a seed of that past experience.
Yeah.
That's the positive approach.
For me, I interviewed Abu Bakr and he got it at the age of 17.
Yeah, right.
We're all trying to be like him, by the way.
and at the age of 17 i thought the government was good yeah yeah i was indoctrinated
it took me a long time have you ever felt out of place in the bitcoin space and if so why
interestingly i feel most out of place in the bitcoin space right now
believe it or not yeah uh i think because you have so many institutions now showing up into the space
like uh everything up until i would say this past year was very grassroots like everybody that was
here really kind of had like this this thing in their past that they were impacted by or that
It really kind of polarized them as to why they were here.
And now that you see it kind of like moving to this next phase transition, which I would
argue is Wall Street institutions and big corporations and even governments for that
matter are showing up.
I'm feeling pretty out of place and not feeling like I'm nearly as excited to go to conferences
and things like that.
mostly because it's gotten kind of corporate-y.
And you know what?
This is where it needs to go next
to kind of continue to scale and take more dominance.
It was only a matter of time.
And I'm not upset about it either.
I just feel less like I'm on this in crowd
or like I fit in, to be honest with you.
I interviewed Willie, as you know,
and he was really worried.
about the centralization of all the Bitcoin in the hands of just a few. How do you feel about that?
You know, if I was going to audit where all the Bitcoin are today, I think it's actually still
pretty heavily controlled into the hands of individuals, which I think is actually pretty
healthy, especially when you consider most of these individuals have been very good custodians
of the Bitcoin that brought it to this point. When I see the growth rate of like the ETFs and
like so many of them custodying on Coinbase, which was the, yeah. But when you look at the size of
that versus like all the other coins that have been held by good stewards through the first,
you know, 15 odd years of this experiment, that's Bitcoin. A majority of the coins are still not with
those institutions yet. I think the institutions are going to continue to usurp a lot of those
coins from the individuals, especially as you just kind of look at the price and the growth
rate of all of it. And I'm hopeful that we get more jurisdictions around the world that become
more open and more friendly to it, which will then kind of naturally distribute the custody
and things like that to other locations beyond just like where it seems to be pooling right now.
I wouldn't say that I'm concerned about it. I would say that I think it's worth watching and
the discussion is probably more important around the topic as we continue to look at the trends.
The most important thing is regardless of like how much centralization happens with respect to
where people are custodian their coins. The fact of the matter is, is the protocol still allows for
an individual to still take custody with private keys to have that self-sovereignty. And as long
as that's not penetrated or encumbered, the mission or the value prop of Bitcoin is still
there. And if that starts to become encumbered, then we got some serious issues.
but I know where Willie's where he's coming from is all the paper derivatives and things like that
that can get built on top of that when you have the institutions and then how like those those
kind of like multiply on top of it and for me when I look at that like a paper market on top of it
what it potentially will do is is make a violent correction and there can there could be quite a
bit of pain for people that just don't even understand the implications of what it is that
they own in the first place, which for me, my military can't blame somebody else. I look at
them like, well, they didn't do their homework. They got tore up and I don't know what to tell
you. Maybe next time you should actually know what you're doing before you go and do it.
You want to go buy the ETF because it's easy to do that and you don't have to hold the keys. Well,
for that person, they say, well, I didn't know. Congratulations. You should have done more work.
you should have studied harder and you should like, that's what I'm thinking. I don't say that
to people, but that's what I'm thinking at all times. Even if it's a family member that just got
hurt very badly by it. I was like, oh man, I'm so sorry for you. But like deep down inside,
I'm just like, well, you should have read more. I don't know what to say.
Self-responsibility.
I'm somewhat like very unemotional when it comes to people not taking self-responsibility for
themselves.
How did the Investos podcast come about?
Well, I guess I need to back up.
similar to the book, similar to the book. Okay. You were born to tears.
I wanted to become a better writer. I wanted to be better at whatever. So what do I do? I go and
I write a book, right? That'd be like the last thing most people would probably want to do.
So I wanted to be a better investor. And there's a saying, you want to be good at something,
just start teaching it. I was like, oh, well, I wrote the West Point book. Maybe I should just
write a book about finance and investing. And it'll force me to truly sit down, organize my
thoughts, come out with an outline of how I think Buffett does this or whatever. I had just finished
the West Point book. And I remember I was in Kandahar and I was there talking to a guy that
I was flying with. What it was is we were talking about a stock pick. And I went into all the,
with this guy. He didn't have any experience in finance or investing or whatever. He was a pilot.
And I was talking about all the accounting and the cash flows of the company. And he was like,
dude, you really know a lot about this stuff. I said, I love this stuff. I'm super into it.
And I said, I've even thought about writing a book, but who the hell would ever read that
on the topic? And he goes, dude, that's your advantage. He goes, the fact that you're not
from Wall Street and that you would be like writing the book, like explaining things in a way
that maybe the common person could understand. That's not like all this financial jargon might
be like your advantage. And I was like, I like that. And this is another like interesting moment,
I guess, for me, when I look at like my friends in the military, they were always kind of like,
yeah, you should do that. Don't limit yourself for all intents and purposes. I was a little
insecure to do any of this stuff, but it was good friends that I had surrounded myself with that
were kind of like nudging me like, no, I think you can do it. So I start writing this book and
it's just like a disaster, right? I'm writing this book and very quickly you figure out how little,
you know, when you start organizing your thoughts and like trying to write on a topic that I was
never, I was never officially taught in any type of formal sense, which did end up being a massive
advantage, I will say. You go to grad school and you get an MBA and they start teaching you about
CAPM models and some of this absolute idiotic thinking of how to perform economic calculation.
And I could get into a very technical reason here, but I think it's out of scope of our conversation.
But because I was never formally trained on it, I came with a way different vantage point
of like how to value stocks.
And what I kept going back to is I heard a quote,
I heard an interview with Warren Buffett
and one time he's like,
oh, I just value equities the same way
that I value fixed income.
I value a bond like this.
And so I just kind of do the same thing
when I'm valuing a stock.
I was like, oh, wow.
Okay, I think there's something there
that I could really learn a lot from.
So I immediately say, well, how do you value a bond?
Okay, well, let me figure that all out.
Okay, I think I understand that.
the math isn't too hard. Now, how in the world is he valuing a stock like that? Because they're
very different. This thing goes into perpetuity. This thing's got a 10-year duration. And so it
forced me because I had no teacher. There was no AI. I mean, I could do a Google search, but it
doesn't have the answers to some of these questions. How do you value a stock like a bond?
Those answers didn't exist. Because I was self-taught and because I was going in there
trying to put the puzzle piece together from the most successful investor of all time,
and I'm trying to reconstruct the puzzle, I think it helped me understand things in a way different
way than what was being taught in business school, which I will tell you is totally asinine.
I started writing the book, and I quickly realized I have no marketing to sell the book.
and YouTube was becoming much more popular
at this kind of moment in time.
I'm looking at YouTube and I'm saying, you know what?
Maybe if I make some videos
that illustrate in a graphical way
this idea that I'm talking about in the book,
then I could do this thing where I take the hyperlink
and I put it in like the Kindle version of the book
and the person could like click on a link in the Kindle
and it would pull up this video
and it would be like a graphical video you could watch with the book.
And it would be like this recursive thing where somebody finds the video on YouTube
and they're like, oh, this compliments a book.
Maybe I should go buy the book.
And if the person sees the book, then they might watch the videos
and it would be like this recursion thing.
And so I started a YouTube channel that complimented the finance book.
I taught myself how to program the website.
So I put the website together.
I have the YouTube channel.
I have the book and sure enough, like people were watching the videos. I had studied search
engine optimization a bit to like for the titling of the videos. So they were getting views. And so
I built this course, like this Warren Buffett investing course on YouTube that complimented
the book, 35 videos in the videos were like video one of Warren Buffett investing video two of like
on the screen. The whole 35 videos were free because I knew if I didn't do that, nobody
was ever going to buy the course. They had to be free. The course got a lot of downloads,
like hundreds of thousands of downloads per video of the course. So then that led to the
book sale And then that was really kind of the seed for the whole financial podcast The podcast was nothing It didn even exist at this point And so then Stig Brodersen he the guy that I founded the podcast with
he watched the whole course.
And then there was a forum
and him and I started talking on the forum
about different stock picks.
We became friends.
I saw he went to Harvard and I was like,
wow, this guy's like,
his comments online were like really good.
And we just kind of became friends.
And I then went to a Berkshire Hathaway shareholders meeting.
I met this guy, Hari Ramachandra, who we used to interview a lot.
He used to come on and have discussions.
He started being on the forum.
Well, I saw Hari at Berkshire and he said, Preston, have you ever listened to a podcast
before?
And I said, no, what in the world's that?
And he's like, oh, it's like people just like out of their house, they're like recording
conversations.
And like, they really, he says, you should do one.
like, cause he had watched the YouTube thing that this course that I made on YouTube. He's like,
listen to this show on your flight home. I think it's right up your alley. So I listened to this
podcast. It was called the guy who did it was Pat Flynn. It was passive investing or something like
it. So I listened to this podcast on the flight back. I downloaded, I listened to it on the flight.
I was like, this is amazing. There's like no video editing. Cause I just built this course.
and it was like all this editing with the videos.
I was like, this is just like me sitting down,
having a conversation.
I don't have to edit anything.
This would be so easy.
I felt like I needed somebody to talk with
because I just didn't want to be like the only guy
on the thing, right?
So I reached out to Stig,
who I was having all these forum conversations with.
And I was like, hey, would you be interested
in like recording a couple of podcasts
and like, let's send them out there.
I can put it on the YouTube channel, blah, blah, blah.
And he's like, I would love to do that, Preston.
but he's like, I'm Danish and I have a really strong like English accent. And I don't think
I'd be the right person for that. I said, stick, there's a lot of people in Europe that also have
accents that would be like, they would maybe like hearing your voice better than my voice.
And he's like, huh, I never thought. And I just wanted them to do the show. I didn't care what it
took. I just wanted somebody to do the show. We started recording these discussions about like
Warren Buffett, like stock picks. Right. And we didn't care if five people listened or, you know,
a thousand people, we didn't care. We were just doing it for our own fun and whatever.
And sure enough, like people were listening to it and we were, we were shocked. We're like,
why is anybody listening to this? Like what, what is, what is happening? One thing led to another.
I remember when we hit like 10,000 downloads on one of the shows and we were like,
dang, who is listening to this? We're pretty boring. Who's listening to this?
And just one thing led to another. And next thing you know, we were getting guests that we would
have never guessed in a million years. In the early days, we were reaching out. In fact,
here in Switzerland, Guy Spear, he wrote this book called The Education of a Value Investor.
and we loved the book.
So we reach out to him on Twitter
and to our surprise,
like we're like,
hey, would you come on our podcast?
Fully expecting he would never even see the request.
And like immediately he was like,
oh, I would love to do that.
And we were like,
we called each other like,
what in the world?
This is crazy.
And what we quickly realized
is people that write books
and people they're looking for media exposure.
They're looking for marketing.
So we interview Guy
and at the end of the interview with Guy,
he was like, that was really fun
because he had never done a podcast.
This is all very early days, right?
He had never done a podcast.
How early are we talking about?
2013, maybe.
He loved it.
And he was just like, hey, I'll introduce you to,
and he started naming these people.
Well, we started looking up these people.
We're like, oh my God, these people are like,
he's really connected.
We were like, oh my gosh, this guy,
the Monish Pabrai had dinner with Warren Buffett. This guy did, you know, he introduced us to Jason
Zweig from Wall Street Journal. And we're like, this is crazy. Like, what is this? And so it just
snowballed. And then like, once you start getting like some of the bigger guests, especially in the
early days, you get some of these guests and like people are like listening to these conversations.
And I distinctly remember Tony Robbins reached out to us. This was the moment in time where,
like we called each other and we were like, what in the hell is going on right now? Like,
what is this? I remember before we dialed in on Zoom, because we're doing this on Zoom
and calling Steve, like what scammer is going to show up on this video feed? And so like we dial
in and sure enough, there's Tony. And we were like, what the heck is going on? Like, how is
is even possible. When it was the two of you, you were having conversations. When you started
reaching out to people and people started reaching out to you, were you preparing the interviews
that did it get more serious, more professional? We would spend a lot of time prepping and making
sure we were prepared. Another hack, I would call it a hack that we did in the early days is we would
reach out to different people that you never hear back. And so we were like, well, let's just,
we loved reading. This is part of that Warren Buffett community is like, you read as much as
you possibly can. So that was kind of like the indoctrination in that space was always be reading
more than the next person. So Sting and I were like hardcore readers and we were like, you know
what? Let's read this book. Let's talk about, let's do a review of the book. Let's talk about
what we learned and we'll reach out to the author if they say yes, great. If they don't, who cares?
Like we'll just still do the review and talk about what we learned.
We wanted to be the AI compression algorithm, right?
Because this is prior to AI.
We wanted to be able to take a book that some people might not want to spend 10 hours going
through and give them a 30 minute to an hour long conversation that kind of summarized it.
And then it could be a precursor that if they liked the conversation, they'd be like, oh,
I want to go read that book.
So it's a win-win for the author.
It was a win-win for us because we're able to create unique content.
And it's a win for the listener because they were able to filter through what they want
to put on their reading list or what they might have learned from the conversation.
And this goes back to this idea of you always want to find a win-win-win with anything that
you're doing.
And for us, that was kind of the early day recipe was we're making ourselves smarter,
we're networking, we're doing all these things.
And this was before like ad revenue too.
We were just doing this for free.
There was no making money in this space for the first, I'm embarrassed to say, probably four to five years.
We never made a penny.
Where was the income coming from?
There was none.
It was all out-of-pocket expense.
But we loved it.
We didn't care.
In the early days, I was still phasing out of military.
So I was doing that.
I was doing this in the side late at night.
And the time frame actually worked because he was in Europe.
I had worked a long day in the family.
And then it was like late at night and we would do recordings.
So, yeah.
You've interviewed around a thousand guests.
Is there a conversation that never left you?
When I interviewed Bill Miller, so Bill was the CIO of Lake Mason.
He was Morningstar's, you know, best hedge fund manager of the decade, like two decades
in a row, just a really super famous investor.
it's funny because as a kid my dad you know he dabbled in stocks he wasn't like nearly as hardcore
as i am he liked business he liked investing right and i distinctly remember as a kid i was
in the office and he came over with a magazine and on the front cover of the magazine was bill
miller and it was saying investor of the decade and it was like this whole write-up on bill miller
And my dad, I remember him handing me the magazine and saying something to the effect of, this man right here is the best investor on the planet.
You want to make some money, this is the guy that you listen to, right?
And he handed me the magazine.
And I remember as a young kid kind of flipping through it and seeing these profile shots of Bill standing there.
How old were you?
Oh, I was young.
I was like 15 or 16 years old or something like that.
Did you care about those things at the time?
not a lot not a lot but i didn't discard it either i wasn't like oh i looked i was like oh
that's pretty impressive like that's pretty neat so the show's kind of like taking off
and we reach out to bill to come on and we were really and interestingly my dad's name is bill as
well but we reached out to his office and we got an answer back like oh yeah he would love to come
on your show, almost kind of like he had listened to the show. And I don't know if that's true or
not, but it kind of seemed like he knew who we were. So he comes on the show and we had just an
awesome conversation. It was really fun. And I remember sending it off to my dad and my dad was
like, this is insane. This is crazy. I cannot believe you just had him on your show. But the
part that was like really funny. My parents are visiting my family for Christmas. We got like all
the Christmas cards, right? And there was a fresh new stack of like Christmas cards from family and
friends that sent us like their, you know, holiday wishes and whatever. And I'm kind of sitting there
in the kitchen and I'm opening like all the ones and I'm going through the cards and I open up one
and it's literally from Bill, you know, happy holidays, Bill, right? Pretty simple. But I got
the Christmas card from Bill and I didn't say anything. I just took it and I flipped it over
the island, like kitchen island to my dad and didn't say anything. And I just kept kind of
going through the other ones. And he looked up at me and he goes, no way. Like, what the hell
are you kidding me? And I just gave my dad a look like, hey, you know, you got to do what you got to
do. It was fun. To the fridge. It was fun. I've told Bill this story and he was laughing. He
thought it was funny. What's a conversation or moment that put you out of your comfort zone?
Oh, this one. And? I'm a little reserved. I don't usually open up too much. I usually kind of stick
to the basics and don't really like give people too much on my personality, I guess. I'm a little
closed off. I like conversations like this because I think that they actually help people
understand somebody way better and you understand where they're coming from a lot more.
But that doesn't mean that it's easier for me to kind of open up. I don't know why.
Well, you're doing great.
Yeah. Well, you're doing great. It's hard for me because I have done just so many interviews
through the years and they just really do mix together to the point where like, I'm going to
tell a side story here. I was literally talking to my dad. This is like last week or the week before.
He goes, hey, Press, did you do any interviews recently? I was like, oh yeah, I did two interviews
this week. He goes, what were they on? And this is Wednesday. I said, I honestly had to go to my
calendar. This is how bad it was. I had to go to my calendar to even remember the interview I did
the day before and the day before that. That's how much the discussions kind of merge together.
And I'm obviously very busy right now. And so that's another whole issue. But
the ones that I struggle with the most is where I have the weakest technical competence and I have
the biggest insecurity. I just recently recorded a show on quantum computing and it's not my
expertise by any shape of the in fact i'm doing a panel uh tomorrow on quantum computing here
and i am not qualified to be leading a conversation like that so i do my best but i'm very timid and
like deep down inside when i walk off the stage i'm like dear god i hope i did it some kind of
justice because clearly like i am a total imposter syndrome which i do definitely get
more than I would like to admit on certain topics.
What's something about the macro landscape right now
that keeps you up at night?
I don't like the phrase, what keeps you up at night?
Because nothing keeps me up at night.
I sleep well.
That's the military in me coming out, right?
Nothing's going to bring me fear.
If I was going to say what I think is probably
the news event kind of happening right now,
It's the liquidity in the system. I think we're getting the reverse repos completely drained.
So there's no cushioning or dampening to the liquidity issue that exists. When you look at
like liquidity is low in the economy. Typically, it's when the reserves inside of the banks are
less than 10% of GDP is what the Fed that some themselves really kind of define as getting into
that zone where it starts getting illiquid. We just started going below that 10% threshold.
and there's no reverse repo. So I would say you're there. And I would say that that's why
you have Jerome Powell saying that they're going to stop doing quantitative tightening and that
they're going to start going into more QE-like activities of adding more fiat liquidity into
the system. And so the question is, is like that credit impairment that's happening right now,
which is why you have liquidity issues, it can cascade really quickly.
and it's somewhat like an avalanche in that when you go and you would try to be like,
oh, that mountain's got a lot of snow on it. It could have an avalanche, but if you're going to
say it's going to happen tomorrow or in three weeks, or if at all, an avalanche expert can't
tell you, right? They have no idea when it's going to happen, but they can look at the mountain.
They could say there's a lot of snow on there and that is a very precarious situation.
And I would say that's where we're at right now with respect to the illiquidity in the system.
It could be next week.
It could be three months or the central bankers, Jerome Powell, could step in and start adding a bunch of liquidity and control and prevent the avalanche from happening altogether.
And you could have markets start ripping because they kind of come in and start seeding it with more liquidity.
And so that's the thing that makes it really hard to ever forecast financial markets is it's
insanely dependent on the few actors that actually control that valve of how much liquidity is
getting turned on or turned off. But I would tell you right now, if they take their hands off and
they do nothing, you'll probably have some pretty intense impairment and sell off and dollar bidding
actually getting more valuable relative to Bitcoin,
if they took their hands off and did nothing
and let that impairment take hold,
you could have something happen within the quarter or two.
What we know is that the Fed and Jerome Powell are quite behind.
Yeah.
But let me give you a caveat to that.
And you're right, they are.
In 2020 with COVID, you had the market sell off.
Literally people were screaming bloody murder Armageddon and that sell happened within a week or two And I can remember the percent that it was down
But within 60 days, the market made a new all-time high from where it was before COVID.
And this is in an environment where not a person was working.
Everybody was at home doing nothing.
And what this tells you is the magnitude and the speed at which they act can create outcomes that I would argue most people would think are unimaginable.
I mean, that's unimaginable to be making market all-time highs when literally nobody's even in around the world.
Around the world.
Like, if you would have told that to me before COVID happened, I'd be like, no way that can happen in 60 days.
Impossible.
but we know that that's not true that we we literally saw it happen that event for me changed
my perception on financial markets like a lot because i'm looking at it like is so dependent
on these couple people sitting in the room completely dependent i mean that's why you
saw everything kind of you know shake out from an inflation standpoint you had so much inflation
that hit. And there's arguments to be made that the next wave could be, despite not even having
a COVID thing, the next wave of printing could be that or more. I'm not ruling that out. I'm not
saying it's the most likely outcome, but I'm not ruling it out. You've talked about liquidity like
an operating system. Please explain. If you just take all the fiat money around the world,
right let's say there's a hundred units just to make the numbers really easy
and you've got those hundred units and then you have like people in there working and they've got
all their products and services that they're doing as long as you can keep those hundred units in that
operating system of these people that are exchanging those hundred units and none of those
100 units get smaller or larger, the fittest are going to have the most of those 100 units,
and the ones that aren't really creating value for that ecosystem of people are going to have
the least number of units, okay? But that's not how the system works. The way that the system
works is those 100 units actually expand and contract, okay? So one day it's 100, the next
day, it's 110. The day after that, it's 130. Then it's 160. And the way that that's happening is
the banks can basically create money by creating debt. And so that's like the expansion of the
credit, expansion of the monetary units. But then what happens is because it's credit-based,
it's borrowing-based, what happens is people get over-levered and then it starts to contract.
It's like a balloon that expands out and then it comes back. The thing is the magnitude at which
it comes back is the same counterforce that's pulling it back into contract. And people
underestimate the power of that contraction that is tethered to the expansion that occurred that
preceded it. And so right now I would argue where we're at is now you're starting into this
contraction phase. And like when it really starts to get going, it's kind of like when you throw a
ball up into the air, as that ball hits its pinnacle, the velocity on the y-axis is zero.
And as it starts to come back down, because of acceleration of gravity, it's starting off slower
and then it gets faster and then it gets faster. And then as it's down here from the peak,
it's going really fast and it's harder to, it takes more magnitude to stop it as it picked up
more speed, assuming there's no terminal velocity impacts of air friction and things like that.
So when I think of like the liquidity in the system starting to contract, it picks up pace
and it starts to accelerate, which then requires them to put more magnitude to stop it and then
push it back out again. Think of it like those hundred units, they expand, they hit maybe 140,
then they start coming back to 130, 120, 100, and then they accelerate and they're going faster.
And then for them to expand that, it takes a lot of monetary energy, a lot of printing
to expand it back out again.
And in the meantime, you have this thing, Bitcoin, that's over here that literally is
those hundred units.
And the other thing that I'm kind of leaving out with this expansion and contraction is
it doesn't go back to a net hundred position.
when they go through this cycling, okay, the next neutral spot is 120. Then the next neutral spot is
140. And then you have the expansion. Meanwhile, this thing is over here that just keeps being
pegged at a hundred. And so with time, this thing's now at a thousand and this thing's over here,
Bitcoin is still a hundred. And so you can see how the value keeps appreciating relative to this
farce of a credit, like we're making up imaginary units as we go system and why this thing is going
to continue to outperform over a long period of time. What are people still missing about how
liquidity is affecting markets? I think most people, like they see a dollar in their pocket
and they think that is what all the money in the system is. And like that literally represents that
dollar in your pocket represents such an infinitesimally small amount of what they think
everything else is. Like that's, that's probably like 1% or less of like what reality is. And the
rest of reality are like promises. It's not like, like if I pull that dollar out of my pocket and I
give it to you, you now hold it. And people understand that. But what they don't understand
is like all the other units in the system,
I will like electronically send you one of those things,
but you actually don't have it.
A perfect example is like the Silicon Valley bank,
you know, failure, right?
If you had $5 million on deposit there,
you thought you received $5 million of paper currency
that's sitting there.
That's what people think or they believe,
but that's not how it works.
People didn't know if they were actually gonna honor
those units in the system until Monday morning when, or I think Sunday night, Janet Yellen said,
yeah, we're going to bail everybody out. What do you mean you're going to bail me out? I have the
units in my account address, right? Right? And the answer is no, no, you actually don't.
And I think most people have no clue that that's how the system actually works.
How do you communicate that to a person that is still indoctrinated?
One of the challenging things, my engineering-ness is going to come out here a little bit. If you transmit a message through radio waves, let's say you're a receiver and I'm a transmitter. I can transmit a message, but if your frequency of picking up is not tuned to the same frequency I'm transmitting on, you'll never get the message.
right? Like 93.3 FM is in this room with us right now. I cannot tune into it because I'm not tuned
to that frequency, but the frequency is in this room literally right now. Okay. And I think when
people are having conversations with other people about something that they deeply understand,
they're deeply passionate about, they're transmitting and they're transmitting in a
frequency that the other person is not tuned to pick up. They get frustrated and it'd be like,
well, why can't I hear 93.3 in this room right now? But I think once you have an appreciation
for the person's just not tuned to the frequency to hear it, then you just get a little bit more
patient. That's why Bitcoiners will say they'll get it when they're supposed to get it.
You've studied empires. Where do you think America sits in the cycle?
According to Ray Dalio, because he has an entire book on this topic, and it's really well done and laid out in a very thoughtful kind of way. And if people are interested in this topic, I would point you to that book is probably one of the best resources on wrapping your head around it.
But I would say that because Bitcoin is so different, this might be one of the defining
moments in history where that cycle could actually not play out for the United States,
which is really interesting.
Because normally what would happen if Bitcoin didn't exist, you would go into a physical
conflict with other countries.
Depending on who annihilates the other, they then get to reset the global monarchy.
order and who's on top and who gets to take all the gold from the other person and recapitalize
their currency on top of that gold. And then the whole system kind of restarts and reflates itself
and the cycle just goes on and on and on. This time, for the first time in human history,
you have a money that can't be confiscated through violence. And that's kind of a big deal.
And that's kind of a game-changing thing. And the one that wins in this battle is the one who
demonstrates the most intellectual rigor. And you know what? That's actually highly dependent
on who's in charge. How much influence do they have to convince others within their country to
be the first mover? I mean, the U.S. is in debt up to their eyeballs,
and dead up to their eyeballs and it's only going faster.
But if the U.S. would adopt Bitcoin
and move in that direction with strategic reserves
and then somehow figure out a way
to not have a victim mindset from a net populist standpoint
to vote themselves more and more money
that they didn't actually work for
because they're so used to the printing press,
they've got to divorce themselves
from that disease of the mind.
If they're able to do those things,
they could come out pretty strong.
in the next 30 to 40 years. And the one thing that I think the U.S. has going for it is everybody
else around the world kind of suffers from this same disease. And so I would argue that success
is for the taking of anybody that can collectively as a sovereign entity apply sound thinking,
critical thinking and action to back it up. It's for the taking. The success of the future
of that country is for the taking. You see the states confiscating Bitcoin?
This is going to sound more pessimistic than my general optimism for any country that wants to
take action. I think that the cognitive debts of not taking self-responsibility,
That is a mind virus, I think, that plagues the US and other developed G7 type countries.
And that's going to be their biggest hurdle in all of this is because as long as the population
wants the handout, because it has been unjust for them, right?
Like, I get it.
It's been very unjust.
But because they want the handout, what that could potentially lead to is the country that
does have a Bitcoin strategy or they start nationalizing assets to get the Bitcoin.
The populace is just going to want to have it paid to them, and they're not wanting to go through a free and open market model because they've been cognitively conditioned to think that that's bad.
And so this is the advantage of the developing nation that's gone through all the hardship already.
They've been a victim of the IMF World Bank dollar dominance arbitrage thing.
they're actually in my opinion sitting in a very advantageous position right now if they're willing
and able to collectively get together and really take advantage of the opportunity that exists in
the world for them a bit because they don't have the mind virus of the handout in the population
like you do in developed nation states right now in the european union christine lagart
mentioned, but maybe already two years ago, that in the moment of a crisis, they will take our
savings. And the scary part is it's becoming a more, the trend is that it's becoming more popular.
Yeah. I can empathize with the pain that they've experienced, but they're flawed in their logic of,
because it's completely incongruent with nature to think like that, because that's not how nature
works. And if you think that we're exempt from nature, you're very naive.
Last one. If you could sit every world leader for 10 minutes, what would you say to them?
I would say pretty simply that the petrodollar system that was kind of the backbone or the
underpinning of all global commerce over the last 40 years is unraveling itself.
and there's going to be a new monetary order that stood up in the coming decade.
And it's going to really kick into high gear between years 10 and 20 from here.
The ones that get off of this idea of being a net consumer by using their strong fiat currency
to go further and further in debt are the ones that are most likely to have the more difficult
transition to the new world. And the ones that are net producers on a net basis providing value
for the world through their exports versus what they're importing are probably going to have the
easier time, assuming that they move to this new monetary standard and go figure it out.
Your ability to navigate this most effectively is completely dependent on your ability to educate
yourself and influence the people around you most effectively. And good luck. Because there's
going to be winners and there's going to be losers. If the world had to go through a controlled
collapse, what's the best case scenario? The best case scenario for me, and we are going through a
controlled collapse of the old monetary order, the best case for me is just no violence. We go
through the system in a somewhat controlled way where there's obviously going to be pain. We're
already seeing the pain around the world. That's already happening. I just don't want it to be
people just losing their lives and senselessness. And we're going to get to the same end state
anyway, which in my opinion is going to be Bitcoin's the new monetary standard. So you can do that in
a peaceful way, or you can do that in a violent way. And for me, the best way is for people just
kind of rally around what the change is and start cooperating with each other, what they're
going to find with time is that Bitcoin incentivizes cooperation as opposed to violence, which is
drastically different than the fiat system. So the faster that you lean into cooperation,
the more peaceful it's going to be for you and anybody that you're interacting with.
Thanks for your time in this super generous conversation, Preston. Where can people find
you and your work. Yeah, I'm active on X, on Noster. You can find me on those if you want to
shoot me a message. I try to reply to most messages that I see. I also have a podcast that goes in the
We Study Billionaires feed. If people enjoy listening to some of the ideas or comments,
you can find me there as well. It's been an honor having you on. Can't wait to have you back.
Until then, stay sovereign. Thank you.
We'll see you next time.