Hey, welcome back to another Bitcoin Study Sessions.
Lucas and I are here.
We are discussing Lynn Alden's Broken Money,
Why Our Financial System is Failing Us,
and How We Can Make It Better.
We're on the chapters 7 and 8 today.
I'll do what I usually do and give a short summary
of both the chapters that we read
and also enough of the book leading up to the chapters
so we see them in the appropriate context.
And then Lucas and I will discuss chapters 7 and 8.
the significance, what's important to us, and just kind of our observations.
So part one of this book began with the question, the overarching question, what is money?
And we got a short anthropology of money, two systems.
Money began both as credit, like we exchanged favors for things instead of exchanging items.
But also we did also have commodity money.
We exchanged items for things.
So we have those two systems of money, credit and commodity, that were kind of different ways of doing money.
And we actually did both use both of them in our history and prehistory.
From that, Alden determined that the commonality between those two is that money is a ledger for recording transactions and ownership.
So it's this more abstract thing.
Money is just the ledger that records who has what and the transactions between us.
Here's a paragraph I've read a few times in my summaries.
I want to read again. It's from the introduction because it does just present the whole book as an
overarching project, and I think it's good to keep present. Quote, at its core, money is a ledger.
Commodity money serves as a ledger governed by nature. Bank money serves as a ledger governed by
nation states. Open source money serves as a ledger governed by users. As the book explores,
the evolution of technology changes the prevailing power structures and incentives surrounding money
from era to era. So we're going to see that last part from era to era here. We're in part two of
the book now, The Birth of Banks. And in the first part of part two that we did last conversation,
we saw kind of the deep history of banking, the emergence of like proto-banking systems like
Koala, which was a system of specialized merchants that allowed commodity money to be turned into
abstract forms of credit for easy transport over distance, kind of like an ancient form of a traveler's check or a wire transfer that was based on the communications between these specialized merchants and this wallet network.
We saw how we actually do have the birth of modern forms of banking in Italy, in the city states there.
So instead of commodity money transactions, two individuals could just go to the same banker, and that person using double entry bookkeeping could just manage the transactions between the two merchants on the ledger that that banker maintained, which was a lot easier than just them constantly doing gold coins between them.
They just go to a shared banker.
So today we're going to see the kind of the proliferation, growth, and centralization of that banking system.
Chapter seven is free banking versus central banking.
So this chapter kind of starts first with a quick overview between the difference of those two styles or forms of banking, free versus central banking.
Free banking, the key is that there's no central bank.
There's no overarching bank that controls the whole deal.
Each bank holds the deposits, the gold for their depositors.
Each bank can also even issue its own bank note, the bearer asset not assigned to a specific person,
its own type of currency that goes into circulation.
Each individual bank, these private banks, could be full reserve.
They could maintain all gold deposits, or they could be fractional.
Their business model could be to re-lend out some of the gold that was deposited to them.
We learned last time how competition between banks will tend towards fractional reserve banking
because the banks make money and therefore can pay people essentially to put deposits with them.
It's more risky, but history kind of tends in that direction.
With free banking, this is the question that Alvin, the recurring questions she's asking,
who controls the ledger?
There's kind of a three-way control of the ledger in the free banking system.
First and foremost, the individual banks, obviously, they maintain their own sub-ledger
of what's going on, the ledger of transactions with them.
Um, nature, though, also because commodity money is still in play is kind of serving still as a constraint on the ledger in that it controls the scarcity of gold and imparts gold has certain physical characteristics that maintain its use as part of the ledger.
government also even in a free banking system assuming we're not in this complete anarchy
government has influence can take over or influence um individual free banks and historically that's
kind of what happened we alden gives kind of a short history of free banking it had mixed record
it was there were successes in certain countries the u.s in the 1830s and 60s it was more turbulent
The banks, as I mentioned, there's this tendency to want to go into fractional reserve banking and then to decrease the fraction of reserves that a bank is actually maintaining in order to be able to lend out more risky.
But they're getting a better return, and they can distribute some of that return amongst people to encourage more deposits.
So U.S., 1830s, 1860s tended to lend out more and more, which is risky.
There was also different – in the United States at that time, different states had their own regulatory schemes, which allowed for kind of corruption.
Free banking is lucrative because you can kind of control this – the banknotes and whatnot.
So there was corruption.
There was also, because there were these different jurisdictions with their different regulations, like Massachusetts versus New York, there wasn't a lot of branching between states with banks. And so there was more risk because they couldn't diversify geographically. And so there were lots of bank failures. That's the mixed records of free banking.
So let's talk about central banking. That's the other style of banking. In a central banking system, the central bank, recognized by the government, standardizes and centralizes and controls the ledger. The central bank is what holds the true reserve. Gold in a gold-based system, maybe bonds in a fiat-based system.
individual banks in the central banking system don't have the gold they what they hold in reserve
is actually just notations on a central bank ledger just liabilities of the central bank
and people do their banking with these individual banks with individual banks just again basically
their asset is an entry on the central bank's ledger um individual banks have no control then
over the value of their reserves because they don't control it the underlying gold or fiat again
And the underlying real asset value is with the central bank who controls the whole deal.
The central bank, that's its role, in fact, is kind of to determine the amount of money in circulation and in crisis to serve as a lender of last resort, create more base money as needed.
It does have that role to serve as kind of controlling the banking system.
So that's a quick outline that Alden gives us of free versus central banking.
She then goes through a quick run through of U.S. monetary system to show how free banking tends to central banking.
We get this tend, maybe inevitable, towards centralization.
She notes, in the Revolutionary War, we first had a currency called the Continental.
It hyperinflated away.
That's the inauspicious beginning of fiat currency.
Then the Coinage Act of 1792, the U.S. establishes a mint and creates legal tender coinage, that layer of abstraction over coins where they're set in standardized units.
That unitization, the standardization of the unit is kind of controlled by the government.
They determine what the unit of the coin is, but it's still not central banking at that point.
It's just the U.S. government setting standards on what the coins are going to be.
The centralization really begins in the Civil War.
The United States at that time establishes literally the strictly regulated national banks.
In a national fiat currency, the first of its type, the greenback – well, not the first of its type.
We had a continental I just mentioned.
But the greenback establishes national currency.
fiat in the sense that it kind of promises eventual repayment in coin, but it's not
currently backed by any reserves. They also, at that time, in that Civil War era, ended
states were no longer issuing their own banknotes. We have this national banknote. So the central
government now has seniorage, the power to make money merely by printing money.
The greenback did not hyperinflate away. It didn't disappear in that fashion. But the greenback did
reveal something really kind of historically important. We didn't reveal it, but it shows to
us now that the currency is a politicized abstraction. There's this post-war debate
that shows that it's now a politicized thing that can be manipulated. There's this debate between
creditors and debtors. How much should a claim be worth? Like a monetary, like a note, what should
that claim be worth? How closely should it be pegged to metals? There's this debate between
creditors who want to retire the greenback, limit these claims to gold, and really want to tighten
the financial supply deflation, which maintains or increases the values of the debts that's owed
to them. The debtors wanted a more inflationary setting to devalue their debts, make them more
easy to pay. So keep the greenback, maybe keep both silver and gold, a larger money supply.
Alden says, quote, this brought attention to an important issue. Dollars were merely an abstraction
of value, redeemable for something of value, which meant that the definition of a dollar
could change in a political group's favor by shrinking or expanding its supply.
Savers and creditors of dollars will naturally want a stronger dollar.
Debtors that owe dollars will naturally want a weaker dollar.
In this politicized debate, at this historical moment at least, hard money wins, silver was
demonetized, and the United States has a gold standard.
But you can't step back from that.
The value of money is now a central political question, and it's going to move towards centralization and debasement.
So we get the first truly central bank.
The Federal Reserve is created in 1913.
Its ledger is now going to serve as the monetary base for the country.
Individual banks, their reserves are just entries on the central bank's ledger.
They're not commodities themselves.
They have no value themselves, essentially, except for as the, you know, a deferred credit that is the central bank ledger notation.
Further centralization. This is a story that I think Bitcoiners are savvy to.
And Alden gives it here that further centralization occurs through gold seizure and centralization of its possession in two ways.
the infamous Executive Order 6102 issued during the Great Depression, which made it a criminal
offense for us Americans to even own gold anywhere in the world except for maybe like
small gold rings or something like that.
It ordered people to hand over gold to the U.S. government on some established redemption
amount.
And then, so that was like this grand seizure of gold in a sense, and then the centralization
of its possession occurred with the Federal Reserve Act of 1934.
Banks were prevented from redeeming dollars for gold, individual banks were.
And gold was transferred to the U.S. Treasury, all concentrated with the centralized banking system here.
So individuals and banks could not redeem for gold.
And the final kind of nail in the coffin, final pull of the rug internationally is 1971.
The U.S. defaults on allowing foreign central banks to redeem for gold.
So this removal of ability to redeem for gold now is going to lead, Alden notes, to structural inflation.
before we we talked about past chapter chat past chapters there was kind of a gradual debasement of
currency when there's legal tender coinage there is an abstraction over the coin that provides for
a layer of manipulation centralized authorities can change how much metal is in a coin the the
size of the coin things like that but those debasements at least occur gradually over time
because there's always existing coins in the system that need to be replaced gradually by
the new coins introduced. But now there's just the bank note, there's just notes, pieces of paper.
So debasement can occur much quicker. The government can just re-denominate the redemption
value of the piece of paper. This structural inflation, people are now going to be basically
required in a certain sense, impelled to protect their wealth by putting it in banks. I mean,
if you put your money underneath the mattress in gold coins, it's going to retain it. Put your
money under the mattress and paper notes, it's going to lose its value very quickly. If you put
them paper notes with the bank, maybe it still loses value over time, but you're going to get
some interest back. So you're going to cut into that. Alden says, quote, put simply, an inflationary
money necessitates the use of counterparties and leverage to keep up with inflation by earning
interest, which is not the case with the hard money. So the structural inflation is going to
increase the power of banks. All this money is going into them. And when there's one central
bank that is the ledger of those banks, controlled by the government, you're going to increase the
power of the government. So that's the importance of the question that Alden's constantly asking,
who controls the ledger? The government controls the ledger here. So when people put their money,
when they're impelled by structural inflation to put their wealth value with the banking system,
they're now giving up privacy and making themselves subject to surveillance.
People's transactions are, of course, recorded on a government ledger, essentially, with the central bank, and so they can see who the transacting entities are.
There's even this thing called the Bank Secrecy Act, where banks have to file reports with the government for transactions over $10,000, and that $10,000 is not kind of adjusted for inflation.
So more and more transactions come under the purview of government surveillance.
Also, the power of government increases because they can tax, we've talked about this in the past, in a non-transparent fashion simply by inflating the money supply.
The ability to change the peg or value of the dollar is the ability to side with creditors or debtors and to, again, politicize value in that way.
This brings us to Chapter A, the second chapter we talk about today, the speed of transactions versus the speed of settlements.
So the last chapter gave us an outline of free banking versus central banking and described the historical events that took us into the central banking system. This chapter is going to give us a key technological development that made that centralization practically inevitable. And again, this is a book about how technology disrupts and changes the financial system. So this is really important in the context of Alden's book. This chapter, I think, is pivotal and very interesting.
So the problem with gold is that it's relatively slow and inconvenient for transactions.
You have to transport it.
There's safety concerns.
You get robbed if you hold it.
You have to verify it.
You have to assay it to make sure it's got the right composition of metals, that it actually
is gold or whatever.
Early banking mitigated some of this.
Again, if you allow transactions to be easily recorded on a ledger and both people use the
same ledger, they can just go to that person who maintains the ledger and note their transactions
between them.
banks that did transactions between many parties could then kind of batch the settlements and
movement move less of the underlying asset so there's two things there's the transactions the
commerce the kind of exchanging of the thing for the good either here's a gold coin you give me the
um the spear that that transaction has occurred and it's also settled because i received the
payment for the thing. It was a transaction that settled. But with banking, transaction
separates from settlement. Settlement is the commerce, the exchanging for goods. Settlement
is kind of the actual fulfillment of payment for that good. You just give someone a claim for
a redemption of an asset held by the bank. So transaction is now separated from settlement.
There's distance between them in time. Separation now of transaction and settlement
allows for claims for gold that occur during the transaction. Here's the credit for the spear you're
going to give me. Those claims can circulate faster than the actual gold itself. But even
the circulation of credit, even when there is kind of that deferred payment between transaction
and settlement, the credit, the speed at which it can circulate in the system is bound by the speed
of humans or horses or whatever the fastest mechanical thing is until the mid 1800s.
This is the technological key that breaks the old system or that enables a new system.
The invention of the telegraph and the advent of telecommunications.
A new communication mechanism is actually huge in the history of financial systems.
So now bigger areas can be placed under the control of a central bank and yet still have near instantaneous access to that bank's ledger.
And so to allow for these transactions and settlements to occur.
So that kind of happens this way.
First, individuals make transactions between them and then settle with a bank.
But second, now these banks are communicating with each other in different areas via telegraph.
And then they can do that also communication, not just between themselves, with a central bank.
And so these central banks can then communicate if they need to with a financial house or a financial hub or like a clearinghouse.
And so you can have these big elaborate structures. A financial system can become very elaborate and can become global in scope. Gold final settlement becomes rare because banks can now bunch a bunch of settlements or bunch a bunch of transactions that offset and then do settlements later between the banks and through this telecommunications based ledger.
so gold is now turning into the abstraction that is credit that is going to allow for the separation
of transactions from settlement you can make the purchase but just hand over the claim or credit
commodity money would settle instantly the gold would instantly settle the transactions but with
credit there's that distance between the transaction and the settlement more abstraction
many millions of credit transactions can occur they can occur very fast with telecommunications
and then later be settled.
So the result of this, to quote Alden,
monetary ledgers became increasingly detached
from any sort of natural constraint
or scarce unit of settlement
because the only scarce monetary alternatives,
such as gold, were too slow
to present a complete alternative.
So this is obviously like a huge tectonic social shift
and technological shift.
at the time, monetary theorists began to talk about this, the rise of credit theorists. So we
talked about the credit theory of money earlier, where money is a claim for deferred payment,
just a form of credit. Now we're actually seeing the credit theorists who are beginning to elaborate
this. And we get a form of credit theory called chartalism that's prevalent at the time.
The idea with chartalism is that money originates with the state's attempts to direct economic
activity. It's not commodities that give money value. It's states giving money value by imposing
taxes on a population payable in the stipulated form of money So it the fact that the state requires you to pay in dollars that makes dollars money not anything else The consequence of the rise of credit money this form of credit money controlled by the state that the charlatists are talking about is this to quote Alden
This gave governments the power to instantaneously devalue a substantial part of their citizen savings literally overnight and funnel that purchasing power toward war or other government expenditures whenever they determine that the situation calls for it.
Value is politicized.
The government controls the ability to inflate or deflate currency.
And so it has extreme power.
So this sounds terrible, and I think most are all Bitcoiners and non-Bitcoiners even may lament this, but Alden says something very interesting. She says, really, don't take this as a moral tale. This is a tale about technology, not a moral story.
so it's it's a you know any sort of technology have disruptive effects and here's the disruptive
effect of telecommunications the speed of light versus the speed of gold obviously a huge um
technological thing that occurred that's gonna have a huge impact and this is the impact it had
on the financial system alvin tells us and it had this centralizing tendency so people again not
moralizing people simply people prefer to pass around credit for example bank notes because
they don't have to transport and authenticate gold and telecommunications enables this
this is though going to have all these kind of perverse consequences enables banks gives them
the irresistible opportunity to move into kind of lucrative fractional reserve banking more and more
because they know people don't want to deal directly in cumbersome gold
fractional reserve banking as we kind of talked about is unstable can require bailouts and can
lead the government then to step in which tends towards more centralization also finance through
the increasing speed of telecommunications based ledger is increasingly international it enables
this international scope of the financial system gold then becomes even more inefficient in the
face of credits transmitted through tele through telecommunications and begins to drop further out
the loop. So all the notes that, I mean, just see it for what it is. Fiat money at this point
is the demonstrated victor. There's two possible ledgers, essentially. Nature's ledger, gold,
which is scarce and secure against debasement, but doesn't move or get verified quickly.
And then mankind's ledger, the dollar, which moves and gets verified very quickly,
but doesn't have security against debasement. One might have individual preferences for one
or the other. But as Alden notes, at this point in history, in the broken money narrative,
fiat is simply the best money. There's no country on the gold standard. And it's seemingly then just
not fit for purpose demonstratively. The problem is the speed of transactions in a global economy.
And Alden ends this chapter with this statement of the problem, which of course, I think Bitcoiners
see as a sort of prophecy, quote, the only way to fix this speed gap in the long run would be to
develop a way for a widely accepted, scarce monetary bearer asset itself to also be able to
settle over long distances at the speed of light. We need teleporting gold. So that's chapter seven
and eight. And Lucas, to pass it over to you, we've actually, if this sounds like some sort of
echolocation is occurring. Lucas and I had this conversation once and it was lost due to
insufficient or misused technology on our part, rather. So we're having it again, but it's
interesting enough to do twice. And we talked about this last time, Lucas, but I want to pass
this back to you. The emphasis, which I find very interesting, that technology is not a morality tale
and that we can understand the rise of fiat currency, even central banking as about incentives
and technology and not as, you know, even like evil central bankers or evil government.
It's not about morality.
It's about like a new technology occurred and then it interacted with human nature.
And we get a system that even though, even though very imperfect, maybe it's the best
situation that could have occurred at the time, fiat money, credit based, telecommunications
based ledgers.
What do you think?
I like to view humans as good, like naturally inherently good.
And so I think if you take that approach, then you can look at the systems that we have and you can, if you like, you can judge them based on the consequences that occur as a result of implementing them.
And so I think that's a very good way to look at it, where fiat definitely won for the short term because a new variable was introduced.
And that new variable was speed because speed previously had never been a question in commerce.
It was always settled at the same time that business was conducted.
You handed over the money.
I wasn't going to give you the cow without you giving me the gold.
I wasn't going to give you the house without you giving me the silver, whatever.
So in that regard, yeah.
When you were talking, I was thinking of plastics, which coincidentally kind of came about in, you know, a little bit after the rise of fiat money.
But it's the same type of thing where we had an influx of this new thing that allowed us to be super flexible and super fast with creating things that were really useful.
So but now we know that those plastics are contributing to landfills that are overflowing and you buy things that you can't you can't replace them once they're broken.
They're they're just trash and and also they're damaging to people to the health.
You know, you've got microplastics in your body and they're literally killing people.
So I do love, again, the way that Lynn takes us through the technological journey of how, like, why did gold need to be centralized?
Gold had to be centralized.
It had to be centralized because it was too value dense.
It was too hard to verify.
It was too easy to steal.
There's just so many faults of gold.
it turns out that in retrospect like the the really only good thing about gold was that it
was really hard to get there was just it was just difficult I mean yes it's a useful metal but
as money the usefulness of metal contributes to nothing and and Lynn has done such a fantastic job
of really hammering home the point that money is not a commodity it's not a dollar it's not
anything other than a ledger. I heard Elon Musk in an interview get asked this question and he
referred to money as a database. Ask what question? Like what is money? And he referred to it as a
database, which is simply a ledger, right? And so, yes, so we've just been increasingly looking for
a, well, we, we, we started by looking for a more efficient ledger because we had money that was
hard. So you, you start with hard money and then you look for a way to make it more efficient. And
it turns out by making gold more efficient, you make it easy. You make it soft. You make it, um,
yeah, uh, you, you basically ruin the hard qualities of it by optimizing for speed.
so yeah and yeah no go ahead no i think that's right it's like gold as a ledger
i mean money has different characteristics as a medium of exchange and as a store of value and so
like gold it loses out kind of as a medium of exchange but it's still all the notes like there's
nature's ledger and mankind's ledger and they both have benefits if nature's ledger is scarce
secure against debasement, but very, you know, slow, mankind's ledger is like very susceptible
to debasement, but very fast. And so like, money bifurcates, kind of like we have gold still can be
a store of value. For those who are savvy to the very rapid debasement of fiat currency. But it
definitely loses out as this idea of money as even a ledger recording transactions or ownership
between people because it can really now only serve as like a battery that stores the value
that is O.G. or something like that.
Yeah, I do.
I would push back not necessarily on the idea that fiat is immoral, but that the consequences
of fiat are right, have been immoral.
Yeah, you look back through history and you look at the in the Renaissance period, you
look at the great buildings and you look at the great art and the great music, the
philosophers and, and, uh, the advance, I mean, the advances in mathematics and science during
those times were incredible. And it was because there was a view towards the future that you had
to work towards instead of using credit and expanding money supply to bring the future to
the present. Um, and I was thinking about this, like in, in, in economics, one of the first things
you learn is the present value equation where you can figure out, okay, this is what the money will
buy today. It's buying power basically. And then this is what it'll be worth in the future. And
that really is not a question when you have a absolutely scarce money like Bitcoin, because
you still have the buying power question because the buying power changes, but the actual supply,
It's like one Bitcoin now is still one Bitcoin 20 years from now.
Right.
So, yeah, it introduces all of these sort of, you know, pseudoscience type of justifications for using that type of a ledger that appear to be very real.
They appear to be very justifiable.
and in the end it turns out that they are merely a justification for concentrating power within a
government because i was thinking about like you know governments want to inflate money they that
like they want to inflate money because then they get to concentrate power it's not that they want
to inflate the money it's that they want to be the first people to spend that money they want that
seniors, right? And that canton on effect. And so last night, I was thinking, I was like,
why is counterfeiting illegal? You know, it's helping, like, it's helping increase the money
supply. And the only reason counterfeiting is illegal is because it takes away the opportunity
for the government to be the first one to spend the money and benefit from that.
So no, and I think you're very right to say that the consequences of the fiat system
can be judged as immoral and bad.
And so we can have a technological advancement
and that itself can be neutral.
It's just a thing that occurs in the world.
But then the things that happen after that,
the state's abuse of the fiat standard,
we can make moral claims about whether that being right or wrong.
And in fact, I think about this too,
it kind of highlights the different styles of critique and analysis
we can do on something like Bitcoin. So with Lowry's software thesis, Bitcoin as BitPower,
a novel form of power projection in cyberspace, a form of defense technology rather than a form
of monetary technology, his style of analysis was not moralized either. It was from the military
perspective. And then also that was based on kind of an evolutionary perspective of the use of power
projection for species as a form of fitness for survival and claiming of resources. Not a moralized
perspective. Evolution is just a scientific thing that occurs. Military policy or military strategy
is also just like an observation about the way that human groups interact. Not moralized.
Alden's take about technology. Technology is also not a moral take. But then you have other people
are thinking about like Gladstein's book, Check Your Financial Privilege. That's a very moralized
take and that's a necessary one from the human rights angle and we could probably go through
and categorize different kind of bitcoin theorizers bitcoin authors like is the style
resistance money um i forget the authors of that but they're legitimate philosophy academic
philosophers and i believe that's kind of a moralized take they justify it based on kind
of a ralzian thesis of behind the veil of ignorance you should choose um bitcoin in to
be in this world because that's the fair thing to choose.
And so like you can have these different styles of observation about Bitcoin from a spectrum
from the technical to like the judgmental morally.
I think it's good.
I think it's good that we like you point out the negative aspects of the fiat standard.
And that's we definitely don't want to just shrug our shoulders and say, wow, it's technology.
Yeah, it's the progression.
If you read the credits in the beginning of Broken Money, Alden donates, I think, the
first thousand or 10,000 book sales to the Human Rights Foundation, to Gladstein's foundation.
Obviously, they're connected, but what Alden is doing as a systems engineer is looking at this as,
you know, does this system work? And I keep thinking about when I first got kind of interested
in sort of the macroeconomic look of the world and the overarching global economy,
one of the things that I was introduced to as a concept that I'd never been familiar with was the velocity of money,
which is basically how often is money changing hands?
And the reason that that is important is because in this type of system, in a fiat system,
if the velocity of money slows, it's like musical chairs and the music stops and everything comes crashing down.
because if people just hoard money, if they just hang on to it and they don't spend it and they
save it, which is arguably maybe what you are kind of morally incentivized to do is that you are,
you know, maybe you probably should have some savings to prepare yourself and be responsible
for difficult times ahead so that you're not dependent upon somebody else.
But the nature of the system requires, as you accurately pointed out during the summary, it requires that since inflation occurs, you have to do something with that money in order to just attempt to try and quell the loss of buying power.
And so you put it into a bank, you put it into a CD, you put it into an equity market, you put it into real estate. The term cash is trash becomes common within the parlance of economics where you're trying to get rid of this thing as fast as possible.
and you're trying, you know, that's why we have people flipping, you know, we're flipping houses,
we're flipping real estate, we're short, short-term trading, we're all of these things
where it's shrunk the time horizon, um, to, you know, days, minutes, um, seconds, milliseconds,
um, in terms of high frequency trading on the, on the stock exchange. Yeah. So it's like,
Yeah, and that's where – the way that I envision it now is it's like strapping jet engines onto a paper airplane so that it's fine as long as the jet engines are running.
But if you take some of that fuel out, if you slow it down, it just comes crashing down.
So we traded time.
We wanted convenience.
We needed to optimize for convenience because we created a technology, the telegraph, that was effectively the first digital social network.
You know, very low level.
If you think about your own social network, it's primarily the first layer of your social network is the people that you do commerce with.
Like those are the people you absolutely do know.
You're a baker, you're a butcher, you're a tailor, et cetera.
but then you extrapolate that to the entire world.
And you have to keep up with the money.
There's just no way around it.
If I'm sending a telegraph from London to New York
and saying I want to buy 100 bales of cotton,
then the guy on the other end is going,
okay, but I want the money.
Like I'm not going to continue to house this.
I'm not going to store it.
I brought it to market.
I'm not going to take it home
and wait for you to send a ship across the, you know, take two months or six weeks or whatever.
Yeah. Yeah. To get payment. And so.
You're absolutely right. Yeah. Yeah.
I just, I just reflecting, I think you have more to say,
because you're absolutely right that like velocity and speed or the defining,
like Aldous Huxley has this quote that speed,
something like speed is a defining characteristic of modernity.
And you have the rise of the credit theorists at this time to justify credit as like moving much faster.
It's just like that speed as a dominant paradigm, like as part of the nature of technology, that hasn't changed.
We have accelerationists now.
We moved into the epoch, maybe you might say, of speed squared, whereas the exponential age, it's not just that speed is increasing, but the speed of speed is increasing.
And so that's the next step.
It's not going to – humanity is going to want to keep on getting faster and faster.
There's another quote, 1909, around the time the telecommunications-based ledger in Alvin's estimation kind of really gets going, 1860s with the laying of a cable on the ocean floor connecting different continents.
1909 of course by that time telecommunications is more established um you have the italian
futurist filippo marinetti has this thing called it's more kind of an aesthetic movement called
futurism but he has his futurist manifesto and he's saying things like speed is our god a new
canon of beauty and so you have almost like this idolatrous worship of speed and you mentioned
earlier, even like the technology of plastics, that's a way to make material like disposable
and quicker in a sense.
And so like speed is the nature.
We almost like internalize that technology is about speed.
And as I mentioned, even with like the exponential age, that that's only getting quicker and
quicker.
And you're obviously right.
It's like velocity is the nature of our age, unfortunately, or fortunately, I don't know,
but it is the case.
I think you can also view it from the standpoint of it's not so much that we're continuously accelerating.
It's that we're just getting back to the speed that we had before.
When I walked across the street and I gave you the gold and you gave me the bread, that's instant settlement.
And that's what Bitcoin allows is that it's still not – literally, it's still not quite as fast as that, but it's a very close approximation.
But the final thing I was going to say on that was that what we realized when we started sending telegraph communications across oceans and doing business across continents was that that in itself is proof that money is a ledger because people were more than happy to accept credit You know they were more than happy to accept credit because that what they wanted
If they didn't want that, then we wouldn't have progressed to it. Right. And so to me,
one of the things that this book has really done for me, and it's not really anything that Alden
necessarily focuses on, but just to continuously try and view different sorts of historical
progression of money as instead of thinking them as gold and silver and all of these different
characteristics and all of these different purposes, it's just thing one and thing two
and thing three. Because if we ascribe this sort of, you know, there's so many people that
this like godlike um quality to gold because of the characteristics that it has um and just because
it did happen to serve as that settlement layer for so long but it's it's not it's it's just you
know that was the stand-in for the way of enforcing the ledger and we're just trying to find better
ways to enforce that ledger as we try and bring the speed back to the same sort of level that we
had when we originally had instant settlement with a bare instrument. Yeah. Yeah. I don't know.
No, when I was, when I was young, I had the naive idea that gold must have been valuable because it
was shiny or something like that. And, you know, I think maybe even if you probed common men in the
street some people would come back to that like oh humans just naturally want gold because for
whatever like it's beautiful or something but you're right that like no abstractly thing one
thing two thing three things have served as money and what they've served as better or worse is a way
to enforce the ledger and like that that is what is important and you're right that that is something
that i mean whatever else you take from alden's book the impact of technology these various
histories of the progression of centralization money as a ledger is just it's really a really
important concept and i mean i think about it even very abstractly like it is what we want
to it's like when i do something for somebody else i want my recognition to the community to
be recognized and i and i want that recognition to come back to me in some way and you know even
the most abstract sense, like when we do a good deed for somebody that's not seen,
people sometimes have like a divine ledger in their mind of like karma or something like that,
or like the God, you know, in a Christian sense that someone's accounting for the good and the
bad that is done in the world. And it's all going to pay out cash out in a fair way at the end of
the day. And that's just like such an intrinsic way to humans view the world is as a ledger that
perfectly accounts for their goodness and discounts for the badness of other people.
And money then as a ledger is a way to approximate that, not in a moral sense,
but in a way of like giving a value to others in the world.
There's a quote, money is not the best way to value a man, but it's the best one that we have.
Yeah.
And it's, you know, you can argue about moral this and moral that.
But if you look at money as a record of value added to the world, that's how you get money is you provide value to other people.
If you don't do that, if all Elon Musk ever did was build himself an electric car and himself a rocket and himself a Neuralink, then he wouldn't have any money.
He would just have an electric car and a rocket and a Neuralink.
But because he does these things that provide value to the rest of the world, he's rewarded.
In your summary, you talked about one of the things that a government can do when they do control the ledger is allows them in crisis to be able to alter the money supply as a lender of last resort.
And that hits me because I used to work for Farm Credit.
Farm credit was created literally as the lender of last resort for agriculture.
It's based off of a German system called Landschaft, I think is the pronunciation, from like the 1700s.
And it's created because agriculture, and this circles back to what you talked about, the debate in the 1860s,
60s, the debate between the savers and the creditors or the same, sorry, the creditors
and the debtors, you know, effectively the industrial of the North and the farmers of
the South was that, um, those, uh, creditors, they wanted a hard money and the people in
the South, they wanted an easy money because they needed that.
Like you, if you're going to, if you're going to farm, you need to have, um, you know, like
right now, if I was to go try and try to start farming a regular size farm in Kansas, 1500 acres,
I would probably need close to minimum. If I was going to get the worst crappiest stuff I could
find $500,000 worth of equipment, maybe a million. And, and obviously you're, you know, you're,
you might make a hundred dollars an acre. So that's $150,000, right? So, uh, you're not going
to pay that back today, tomorrow, next week, next year, a decade from now. And so you do create this
need. But the thing that perked up my ears when you said in crisis was, I don't know that there
are any crises that the government has come to the rescue of that they have not created.
and the one that really pops to mind is
and this is fantastic to look at
if people want to go look at the pictures of this online
was there was a farming crisis in the 80s
when all of these farmers went broke
because they were financed through farm credit
it was almost entirely because they were financed through
at that time it was called the Federal Land Bank
and they're financed on variable rate notes.
And during that time, we saw interest go to like 22%.
And so if you're on a variable rate note,
then your interest payment just gets more and more every year.
You can't make the payment and they end up repossessing all the land.
And it's a fantastic piece of, I think, Americana history
history in that you can go back and you can read about like what are called nickel auctions
where guys would come to the to the bankruptcy sale of a local farmer yeah and they would bid
like a quarter a nickel a dollar they would all agree not to buy this person's stuff and they
would just buy it for the tiniest amount and then give it back to them and there was a massive tractor
brigade i think in like 1979 farmers from all across the entire country that drove their tractors
to Washington, D.C., and there's just thousands of tractors there.
And by the way, this is happening in Europe right now.
Yeah.
And I think it's in the Netherlands, and there might be somewhere else where they've broken
this farming economy, and they've really started to struggle because of the crisis that was
created by the government that the, they said that they were there to, it's like a, uh, it's,
it's the, um, it's the arsonist that is also a fireman. Yeah. You know, like we started the fire,
but we also want credit for putting it out. And so I kind of wanted to throw that question back
at you as like, is, are there, are there crises that the government solves that they do not create?
i like that cynical inversion of the question or not cynical realistic and before i go on to that
i want to say i think that the subject of bitcoin and agriculture given that agriculture even going
way back in the history we now see has a very special relationship with debt because the harvest
all comes at one time so it's like necessary to have credit through the various stages of the
production of this final thing, the harvest. And so if someone's listening, like there's been,
you know, people talking about Bitcoin in real estate, commercial real estate,
and regular real estate, you know, someone's listening and has special insight into agriculture,
I'd love to see Lucas ask questions of that person and hear that conversation. That would be
really fascinating. On the question you put to me, like, I mean, I think that you're very right,
that democracy is like the worst system, except for all the other ones that exist.
And one of the bad things about democracy is that it can lead to this, it depends on
the public opinion.
And so it can like preemptively drive the public opinion to where it wants to go.
And so there's always, if you need to manage the public opinion, a crisis is a good way
to do it.
And in fact, if crisis is your mandate for action, you're going to find crises in a lot
of different places um alden mentions this in an earlier chapter uh when she there was a credit
theorist um michelinus and he noted that like the credit theory credit system works great the only
like times it might have difficulty is like in sudden disruptions or whatever maybe exogenously
causes the system like a war or something and alden's like hold up like war actually is a
manifestation of the credit system. Because, you know, we get these wars through often opaque
taxation to fund them. If you had to transparently tax people like, we're going to tax you so we can
send your sons and daughters overseas to die, people would ask more questions. But because
the taxes are opaque, they're hidden to the form of inflation, wars can occur more frequently and
of longer duration. And so I agree with you, even though it sounds like a cynical thing to say that
crisis happen more often when crisis are what the government needs to happen in order to do what
they want to do in any case, which is centralized power. Yeah. And centralized power is, it's
hierarchy, right? So you, this is, this is how we ended up where we are because we naturally need
hierarchy. So this is the work of Jason Lowry. This is the work of Jordan Peterson. Um, we,
and, and, and it's also taking into account what, what Elon Musk always says when he's talking
about systems is you have to take it to the nth degree. You have to take it to the, think to the
limit, which is if first I want the convenience of a bank, then I want the convenience of a bank
with branches in neighboring towns. And then I want the convenience of a bank with branches in
neighboring counties and then states and then international. And then I want a national clearing
house. And then I want international clearing houses. And you just keep abstracting to this
higher and higher level of authority for convenience because you're just trying to
save time because time is the only resource that you can't create more of other than.
Yeah.
And so you're just trying to save time.
And by trying to save time, you are giving up power to a authority in order to take away
the responsibility of doing that.
But by doing that, you're creating this rigid system that demands stability.
And you think about it in terms of like, what are the most resilient structures?
What are the most resilient systems?
They're not the ones that are made of granite.
They're not the ones that are made of 90 degree angles.
They're the ones that can absorb, flex, and they can take in energy and disperse that throughout the system without collapsing.
And I think that's very important because what we're trying to do by government invention into the monetary supply is trying to stabilize this. Nassim Taleb talks about this so much, which is we want stabilization. We don't want change. We're trying to make sure that we have constant, steady growth.
and what that is like.
It's like building a house out of just sticks or toothpicks.
And anything can break that.
Anything can knock that down.
And this is what we're learning as Michael Saylor is teaching the world
about volatility as a good thing.
Like we want volatility.
Volatility means that you're resilient.
Volatility means that you can take change.
If you can't take change, then you end up having these blow ups and these explosions and this collapse and catastrophe that were not possible in a different type of system.
If you have that, if you have that sort of resilience.
So and that's kind of what I think about Bitcoin is like it's not it's not rigid.
It's not structurally structurally hard.
It absorbs the attacks that come to it.
If you're trying to do a 51% attack on the Bitcoin network, which for those people that are, there probably aren't a whole lot of new people to Bitcoin listening to this.
But if you are unaware, this thing called a 51% attack, where if you were able to take 51% of the network's power, then you could theoretically rewrite the ledger in order to give yourself money, give yourself Bitcoin.
But in reality, what happens is that as you continuously ramp up the power that you're imparting onto the network, you're making it stronger.
Every bit of power that you put into that, every attack that you put into that, it's being absorbed and it's using that in order to make the network more defendable and more resilient.
And so, again, this goes back to – I know I'm heavy on quoting Elon Musk, but I do just like a lot of the things that he says in this regard.
And obviously he's fairly right about quite a few things, which is – oh, I lost my train of thought.
Man.
Oh, it bounced right out of my head.
I'm sorry.
Yeah, if that quote comes back to you. But I mean, what you're saying about centralization is interesting, because, I mean, again, centralization may have this rigidity, which is a sort of fragility.
But historically, it has like concentration of power set by centralizing it has led to like victory over groups that did not centralize power going back to Lowry, like, you know, we're incentivized to cooperate to agglomerate to aggregate, because we then become more powerful than another group.
we've hit maybe a ceiling or something on centralization and or at least maybe with
technology we're beginning to see ways in which decentralized power as you pointed out can take on
has a resiliency that centralized power does not and also has an ability a judo ability to redirect
power to absorb power to absorb attack that centralized power does not and that's the really
bright thing for the future is like maybe there were historical or technological tendencies
inevitabilities that led to us having the system we have of extremely centralized power but it just
augurs so well and beautifully for the future bitcoin is hope it is i think say i don't know
sailor originated that but it's a common common enough sentiment and it is i mean absolutely true
that if we do have a technology that allows us to decentralize power like that's it's it's
It's phenomenal.
Like that technological advance, telecommunications, these things in the past have pushed us towards centralization.
And now with proof of work, strong cryptography, the mix of these technologies, we now get to decentralization as actually the alternative you want to get behind if you want to be part of the group that's going to have fitness for survival and push into the future.
And so it's just and we see that maybe decentralization can be maybe not just as a metaphor.
Maybe there's connections between these things, but we see decentralized media in the form of Twitter now breaking up and providing a better service, the more centralized mass mainstream media.
decentralization in every sort of realm may be you know abetted at least by bitcoin as a
non-censorable payment system that can't be held back by centralized power but at least provides
like the metaphor for the future perhaps is decentralization i hope after so much centralization
it just gives one incredible amount of hope to think that that might be the case that
if marinetti said speed is our god new canada beauty maybe now we say we need a sexier word
the decentralization, but is our, is our strength in numbers, you know, we've already got it. It's
strength in numbers. It's, um, the, the problem with centralization and, and hierarchies has
always been that it only works so long as the person or the power that is at the top is doing
the things that align with what you want done. And that's always, you know, that was the, that
was the argument over the last four years, eight years, 10 years with all this censorship that's
been occurring at the international national every single level which is you've got the people that
are being deplatformed and yeah they're upset about being deplatformed but they're also trying
to point out like this only works as long as you are in charge like if your opponent gets in charge
you've created this system that allows them to do the exact same thing to you and you don't want
that. Like you, you have to think, Oh, what it's the, the Warren Buffett quote is like, I buy
companies that only an idiot or I buy companies that an idiot can run because eventually one will.
Right. It's like, yeah. Yeah. Like you, you want that, you want that, um, system to be
safe from human intervention. James, James clear wrote the book, uh, atomic habits, um, which was
this so foundational transformation for me about just creating solid habits and creating a routine
and a ritual and staying within that because he has the quote that is, you don't rise to the level
of your goals, you fall to the level of your systems. And it's like, yeah, we can all hope
and we can want and we can wish and we can pray. But as they say, you know, you can wish in one
hand and shit in the other and see which one gets filled first. And that's so very true. Like
hope oh this one of my favorite uh one of my favorite sayings when I was in lending
was we had this this lender that um we would look at we review financials and we would see that this
guy was had this plan that it like okay everything works and we going to make money as long as we have six and a half dollar corn and corn is trading at or as long as we have steers and steers
are at $1.50 or whatever. And we just look at that and he goes, hope is not a strategy.
Like, you know, hope is what you have for your strategy, but it is not the strategy.
And so you do have to hope for the best and plan for the worst.
And so what we're doing, yeah, we're planning for the worst.
And you're talking about decentralizing technology and the power of it.
You know, out here in Western Kansas, my dad is able to go see – he's able to visit a specialist at our local hospital because of decentralized technology.
Like nowhere is he going to be able to find a world's leading expert on cancer in the middle of nowhere, Northwest Kansas.
But because we have an Internet connection, he can go there and have his stuff sent off.
And yeah, but is that actually, though, that's kind of the centralization of medicine, though, is what funnels us into hospitals for expertise.
I wonder if decentralized medicine like Medicine 3.0 or whatever is if there's I see what you're saying.
It's the intermediary step, really.
Yeah.
And I don't know what is going to decentralize medicine, maybe just like less government regulation, a different way of doing insurance, something like that.
But I mean, I think that there is a viable way in which medicine is even like a commonality with a lot of forms of decentralization is the need for self-sovereignty.
If something is decentralized, then you have to take responsibility to kind of navigate the thing for yourself or to be part of a system, a tribe, a clan, a network of people that can help you navigate it to trust, to develop networks of cooperation and a friend and kin again to operate within decentralized systems.
systems. Um, but yeah, I, I mean, I hope concomitant with decentralization, there is that
empowerment of the individual to realize that, you know, it's not a bad thing to not have big
brother, you know, it's a good thing because you might rely on your actual brother to help you with
something. And, you know, yeah, we, we created the food and drug administration in order to protect
people from food and drugs. And now we have the fattest, sickest, most unhealthy, most drug
addictive population. And it's the most fooded and drugged person. It's a direct result. And we
created the, you know, we created the EPA and now we have plastics in everything. And we have
chemicals everywhere. You know, we, we talk about around here, we talk about in the farm, again,
a reference to farming, but we created all of these chemicals in order to do chemical tillage
and chemical fallow so that we don't have to go mechanically through things. We abstracted the
layer of killing weeds from a steel plow or a steel disc in order to replace that with a chemical
interaction. And what we've done is like the town that I grew up in was known as the pheasant
capital of Kansas and every single year, the size of the town would double during pheasant season.
And for the last 20 years, if you saw more than five pheasants a day, that was a big day.
Previously, you would see literally thousands. And so there's all these downstream negative effects
of putting Big Brother in place. We created the Department of Education and now we have the
dumbest people. Like it just, it's not, you can't, you can't just, you can't just stand in front of
something and say, we're going to make this better. Um, because that's not the strategy.
You actually have to open it up. Like what, what is the best test is to let everybody run their own
test, you know, to be able to let somebody who has no other choice for a medical intervention
to try something that's not approved by the FDA, to be able to let somebody who has no desire to rape and pillage the land with corn and soybeans that weren't designed to be planted there,
to be able to plant something else.
But you can't because the subsidies aren't available for it that allow farming to survive because we've nationalized the banking system.
We've nationalized the farming system. We've done it in a cloaked way so that it still kind of appears to be capitalist.
But in reality, and we're going through this exactly right now, this 1,597 page long continuing resolution posing as an omnibus bill posing as a continuous resolution that was just shut down.
It had all these farming subsidies in it that the farming community on one hand thinks they need, but on the other hand, there's a lot of people farming that shouldn't be farming.
And that's just the fact of the matter that because you want to doesn't, you know, like desire is not competence.
Just because you want to be involved in something does not give you the inherent right, the God-given ability.
You have the pursuit, you know, the pursuit of happiness, the pursuit of desire is not competence.
Hope is not a strategy.
So we're getting our we need to get our carts and horses in the right the right order.
Yes, moving that way.
So I had another question for you, but I was trying to think where it went.
Related to what you're saying, just on the point before we move on from decentralization, maybe here's an example you can put into practice after listening to this conversation.
of decentralization.
So maybe we can think of academic decentralization.
Right now there are, you know, there's the Ivory Tower academia
and they have kind of their cloistered discussions,
their peer-reviewed journals and whatnot.
Now we have Twitter where academics are on Twitter.
And in fact, Alden in this chapter cites George Selgin in print on free banking
and gives a hearty nod and his affirmation head nod and his direction saying great stuff.
And she drew a lot from him on free banking. He has a Twitter account. He's active on Twitter. And I read his Wikipedia. If you weren't aware of who George Selgin is, Wikipedia article notes, quote, Selgin is considered a Bitcoin OG, original gangster, Wikipedia clarifies, having taken part in the original cypherpunk mailing list with Wei Dai and Nick Szabo that led to Bitcoin's invention, which Hal Finney and Nick Szabo say he helped to inspire.
so it's really interesting that in the intellectual journey that was the creation of bitcoin we have
an academic expert on free banking who wrote a history of free banking and not only that but now
he's active on twitter and so in true decentralized knowledge accumulation fashion you can go and
engage with him directly and from what i've read on his twitter he's he's a very he's a good faith
right in this moment i haven't i don't know like what he's been on about for the past years or
whatever. But in this moment, he's a good faith critic of the Bitcoin strategic reserve.
Reading his critiques, you're like, okay, I see where you're coming from. And so he's someone
that one could engage with and practice that decentralization of knowledge for sure.
Yeah, the ivory tower barricade for education and for knowledge, it really served to kind of
highlight the, the failure of that system where you see people that are intellectually curious,
making themselves available and the, the old guard of academic, um, academic gods, I guess.
Um, you know, all of their stuff is paywalled. Like you, you can't read, um, you can't read
research papers just going on the internet unless you find them in, there's a few decentralized
sources, but they're all behind journals and behind paywalls. And unless you're a student
in a university and you're actively studying that stuff, then the research that's going to
change your life is held away from you in such a way that makes you question why. Like, why is it
important. And you can tell this so easily when you look at people like Twitter's a great
sorting stick for this type of thing, because you look at these people and you'll see somebody that
has no credentials listed on their profile and they're making sound arguments that people are
listening to and they can agree with or disagree with based on the merit of the idea. And then the
people that are disagreeing with them are the ones that have all the letters and all the credentials
and the PhD in their name. And their first thing that they always say is like, who are you
to question me? And, um, you know, because I'm, I'm at Harvard, I'm at Oxford, I'm,
I'm a PhD, I'm a whatever author journalist. And it's like, yeah, but that doesn't make you not
wrong. You know, you can, you know, it just makes you, it just makes you wrong with a whole lot of
investment. Yeah. And a lot of these people, I think, though, you know, on Twitter, an aspect
of the decentralization of knowledge dissemination is that with decentralization, often accompanying
that is like anonymity or pseudonymity. And so you could have like Booger Toilet 420, like engaging
with George Selgin, but Booger Toilet could, you don't know who that is, that could actually be
some guy way up in the government who realizes that I can't talk to the people around me and say
my actual ideas. I can only do that on Twitter. And so they go on there in pseudonymous fashion
and disseminate information that within their social milieu, they maybe could not say without
being excommunicated. I mean, you and I are absolute proof of that. We don't have background
in Bitcoin. We weren't on the mailing list. But because of this and because we take ideas and we
talk about them, we're able to have reasonable, productive, growth-oriented discourse around a
subject that is arguably as vital to our survival and our ability to strive and move forward,
arguably as anything else, you know, maybe health. But to be able to just converse with these people
and reach out to these people, it is a rising tide.
It is raising the level of public discourse.
And there are still a lot of people that are either actively not engaging
or they're just simply ignorant of the ability and the opportunity.
And that's falling every day.
Like that's, I don't know, like you orange pill people to Bitcoin.
I don't know what the equivalent is to bring somebody over to Twitter,
But I've done that a couple of times recently where I've talked to people and reasonable people, reasonable people that have a good approach for things and kind of talked to them about some things that maybe they had some, I would say, heavily censored base of information on such that they were only allowed and logically constrained to make certain assumptions based on that information.
And just, you know, point them out to something on Twitter that's like, hey, this is actually where ground truth is happening.
This is where the worst seeking is happening.
And it's really cool to see people's eyes light up.
And it does take you back to the time of when the veil was first lifted, when you first had the moment of, man, I don't want to, yeah.
I don't love putting an explicit language label on our podcast, but I do think at times it's worth it.
It takes you back to the time when you first started looking around and going, oh, there's a lot of horse shit.
Like, there's a lot of horse shit here.
There's a lot of bulls. John Verveke, who you can go online and listen to his awakening from the meaning crisis, I think, is what it's called.
a lecture series, like 53 hours of lecture, walking you through, um, meaning and purpose and,
and life. And, and, uh, he, in the very first one, he defines in a technical sense,
bullshit, um, which is that thing that, yeah, there's a, there's an academic book on that on
bullshit. It's by somebody. Yeah. There's a, it's within the philosophical discourse. It's a side,
it's a well-cited book. I think you will like to cite it because of the fun title,
but it's called on bullshit. Yeah. I love that. I mean, it just, yeah.
It, and it's unfortunate that you, but, but then again,
it's also probably we're probably the first people in history that were able to
actually lift that veil. You know, previously there,
there was no decentralized ability to do that. You know,
there was still kind of ways, you know,
when you had the printing press come along that you started to decentralize a
little bit of information, but it was still very centralized.
Um, and yeah, so I, I think we're just, we're moving in a very good direction.
We've got, um, this rising tide, these technologies that are decentralizing everything from healthcare, um, health advice, financial advice, Tesla's decentralizing, um, vehicle safety where, you know, every time you make a turn in a Tesla, it learns something.
And every other Tesla in the world learns that.
And so it makes it better for everybody else.
It's just this accumulation of power and power in data.
But again, like those accumulation of information within a centralized network.
I mean, because one could say that Facebook, right, right.
Because Facebook is not decentralizing the accumulation of behavioral knowledge about us.
It's like taking all of our behavioral knowledge and using it for Facebook to repackage that and sell products to us.
I mean, it's good when Tesla does it, right?
Because safety is, you know, unarguably a good thing.
And maybe we could, through some sort of non-crypto-related shitcoin, decentralize AI's accumulation of real-world sensory input and then make that available to everybody or something.
Maybe when Elon dies or maybe when he decides that he's just done dominating that industry, maybe he'll just open source all of that technology.
I like how you stepped back from Elon's death. He's not going to die.
He's maybe a postulate.
We know with this,
the technological age and level of wealthy.
There are two,
maybe,
you know,
there are two things about Elon Musk that,
that kind of bother me a little bit.
And one is that he's not a stranch advocate of Bitcoin,
despite holding over 9,000 Bitcoin on the,
I think it's a SpaceX balance sheet or might be Tesla.
I'm not sure.
That's what the other is his,
like his,
he has this very laissez-faire approach to like health and diet.
He's like, eh, whatever.
Have some drinks.
Have some donuts.
You don't need to work out that much, really.
It's like, eh, I don't know.
Maybe you do.
It might be good.
Yeah, yeah, yeah.
Now there's people all – yeah.
I won't go for it because I'm almost – yeah.
So I'll just – I'll end it there.
I'm just thinking like the changing faces of – the changing faces and body structure of Elon Musk is very reminiscent of Oprah.
I don't know if you've ever seen, but there's like throughout the history of Oprah, there's like skinny Oprah, fat Oprah, fat Oprah, skinny Oprah, skinny Oprah, fat Oprah.
Like it just goes like, whoa.
And with Elon Musk, it's like, oh, balding guy, skinny guy.
Now he looks like the emperor of North Korea.
Now he looks like he's had Botox to the nth degree.
He's on Ozempic and all this stuff.
Right.
Yeah.
We're changing the face.
To a certain degree, though.
So I'm glad that nobody – like there has not been a constant camera plotting my biological, physical advancement from like junior high until now.
There would have been some epochs in there that fashion-wise we would not want to revisit.
And then I'm glad that that's been lost to history.
Yeah, you and I lived through the time of JNCO jeans when people had 44-inch legs on jeans or the bell or whatever you call it at the bottom and the frosted tips of the hair.
A lot of things happened.
It was pretty rough.
A lot of things happened.
It was not great.
Definitely.
Not great.
Pre-internet fashion dissemination was an interesting thing.
Yeah, good.
What was the thing we talked about?
Oh, we talked about in the first time we did this.
it was my favorite part. So I'm going to throw it back in was we talked about speed being introduced
as a variable to money was a lot. Like when you're a kid in a small town and somebody new moves to
town and they're like, they're like the cool kid of the entire grade for the first six or eight
weeks of school, just because they're like, he's like, Oh, they got an Abercrombie shirt. Like
who the hell? Nobody's ever seen that. Somebody came from Mars. Like, yeah. Coming bearing new
or like i don't know or they had the haircut that they parted in the middle
what are some like some spanish conquistador arriving at the shores of south america and
like what is what are these four-legged things that they're riding like yeah it was
yeah it wears off so it does well so i for to conclude for me um the the tenor of this
conversation i would say is that into into so if speed was the characteristic of the last epoch
and the last um kind of characterization of what is essential about technology is increasing speed
that i would say to change the quote of filipo marionetti um decentralization is our god and
new canon of beauty not an idolatrous fashion and in fact decentralization is what helps us bring
down like the false gods that are centralized power right now. And so I think that talking
about this chapter, like that's what I take away from it, that speed disrupted the financial
system. And now there's a new disruption coming down the pipe, which is decentralization and
the ramifications could spread well beyond the financial system. Yeah. And my takeaway from it
is resilience, is that we learned that speed is a variable that we have to optimize for,
but we can't optimize for it in a good fashion.
We can't optimize for it to benefit the whole of humanity unless we first take efforts to make the system resilient and make it secure.
So you have to start with a boat that doesn't sink before you start putting jet engines on it,
because if you don't, then you're just going to drive it into the ground faster and faster.
Right on.
Fantastic.
All right.
Well, we'll catch you next time for chapters.
it'll be eight and nine,
nine and nine,
10 and maybe,
maybe nine through nine,
10 and 11.
Just given that part three is an odd number of chapters.
I'll talk to you,
Lucas,
about that in a second,
but yeah,
maybe nine,
10,
11.
No,
we talked about that before.
So we'll just make that decision right now.
So nine,
10 and 11,
if you're reading along with us,
go ahead and take that,
take that and go forward with it.
Once again,
as always,
Grant is at the whole frame on X.
I am at Lucas Maddy.
This is Bitcoin Study Sessions, and we appreciate you guys listening.
Have a great day.