Your Freedom is at Stake!

Hey everyone, Michael here with the Bitcoin Way podcast. Thank you for tuning in. Today on the show I have Peter Stain. Peter is an expert in many things. He is a bartender turned economist. We can he can go deep on geopolitics, so many things. So we covered Iran, Venezuela, counterterrorism operations in Ecuador for the United States. We covered tariffs. We covered really a range of topics. And ultimately it came down to what is the impact on Bitcoin? Where does he see the world headed over the next 5, 10, 20 years? And I think you're going to find this fascinating. It was a great conversation. >> Hey everyone, like I said in the intro, I've got Peter here. Peter, welcome to the Bitcoin Way podcast. >> Thanks for having me on. >> Yeah, I'm excited for this. We have Man, 2026, we have so much to cover and I'm going to start with the most important thing. So, you are a former bartender turned economist. So, I have to ask you what what's what's the best cocktail? It is not an impressive cocktail. I'm not proud. But my favorite is Kalúa and milk. >> Optionally, you can put h vodka in it, which makes it a white Russian. Absolutely delicious. You've never had it. It's addictive. >> Okay. What was like the most popular cocktail that you served then? Like what were what was everyone ordering? >> Almost everybody just does gin and x or vodka and x. Uh so like screwdriver, genonic. >> Uh those are like 80% of orders are going to be really boring. stuff like Coke and uh rum and coke. Just pretty pretty boring stuff. >> The pain in the butts are the frozen drinks and the freaking Long Island iced tea. You got to like clear your entire shelf. >> Yeah. >> For Long Island. Like everything's in there. It's like remember when you're a kid and you go to Burger King and you get the Coke. And you're like, "Well, I like Coke, but I like Sprite, too." And so you just go ahead and put everything in your Like that's Long Island iced tea. >> Yeah. Except for it's not all ready to just press a button and and fill for you. You've got to you got to prepare it. Yeah. I mean, I guess nowadays, you probably have Long Island and iced tea mix, I bet. But like when I was, you know, when I was coming up, we had to walk uphill both directions. >> Yeah. No, I I hear you. I hear you. Okay, let's get into the less important stuff. You talked about uh on a recent video you did, one of your daily videos, which by the way, I love. I think so does the rest of Bitcoin Twitter in the world. um a a I think it was a must ha mustpass housing bill that somehow a CBDC or some sort of a reference to a digital currency of of sorts is seems to be slipped in. What what's the nature of the bill and then what was the language being used that you you called that out? >> Yeah, so they've got this housing bill. Everybody in America is pissed off that housing is so expensive. It's one of the big pieces of the affordability problem. uh along with uh health care is probably the other big one. And so Congress knows that they have to fix it. Inflation is the top voter issue. Before the war, inflation was actually really low. Like true inflation does private sector alternative to government statistics on inflation. They scrape I think it's like 13 million numbers something in. And they literally scrape them. They don't have economists who you know throw dildos at the wall and make up numbers, right? These are like actual direct scrapes. And according to them, inflation was down to 0.7%. >> Wow. >> Before the war, which that is so low, like literally that is the point where the Fed starts trying to create more inflation. Like as long as you have a central bank, you're really never going to get that low. So that's essentially zero inflation with a central bank. Uh and now it's up because gas exploded and then gas feeds through to everything else. So now it's like one and a half six. But the moral of the story is that inflation was actually very tame. But the issue is psychologically because prices went up so much during Biden's term, people still feel like everything's really expensive. They still feel like inflation is really high even if it's bumping along at 0.7%. Moreover, during the election, Trump said he was going to cut everything in half, right? This is how Trump talks, but anyway, houses are going to cut in half. Everything's going to be half the price. And of course, I mean, that's not economic. Like even if you could somehow do that, like you know if you waved the magic wand and Caesar takes over and puts in all the good policies, you have Javier Malay take over the US with a chainsaw. Even if you did all that, the Fed actually wouldn't allow that. They would again, they would create inflation. But having said the issue is that voters are really pissed off about inflation. So they have to do something. They don't want to touch medical. There's a lot of donors. It's an absolute mess. That's just a landmine. Uh so instead they're looking at housing. So they have this housing bill and they do some useful things in there. They try to get rid of red tape. Uh local zoning, which is a big reason why houses are so expensive in um in San Francisco or New York. Uh rent control, punishing locations for rent control by withholding federal construction funds. So, there's a couple of useful things they're doing. There's some other less useful things that they're doing like allowing community banks to lend more money that they don't have. So, that's fractional reserve banking. uh letting them get closer to the big uh too big to fail banks which um keep about seven cents in the vault whereas community banks keep about 10 cents in the vault. They're upset because they want to inflate just like everybody else. So that's the housing bill and they're they're doing so there's two ways that crypto broadly speaking intersects with it and um one of them is stable coins where the ability to pay interest on a stable coin has now become sort of a political football that the house and the senate are are trying to use to get this this housing bill through. Uh and the reason for that is that fractional reserve banks of course don't want competition from a stable coin which given the genius act last year stable coins have to be backed uh in practice backed with treasuries which is essentially as good as cash. Uh and so that means that a stable coin then becomes a full reserve bank that pays 5% interest whereas your bank has 7 to 10 cents on the dollar and pays zero interest and charges you a bunch of fees. So Wall Street of course is very strongly opposed to that. So they're trying to stick that in there to get that banned. On paper it's banned, but like Coinbase has a rewards and loyalty program. Like it's not really banned. So they want to extra double ban it. Uh, and then the other one that they snuck in there, which like this was unbit Well, I presume honestly I presume Ripple paid for it. Uh, but is this little little detail in there that allegedly it's a CBDC ban. The Republicans have done this a couple times. They do these CBDC bans, but the trick is the ban only it it is written in a way that it only bans what's called a retail CBDC. Okay? It does not ban a wholesale CBDC. Now, a retail CBDC is where you treat the Fed like a bank. Okay? So, you've got basically US government stable coins, CBDC. Those would replace the US dollar and those are parked at the Fed. And the Fed cannot go bust because it's a money printer, right? So, the Fed will always be safer than a bank. And so, you know, the the banker's fear again is that this time the Fed would wipe them out, right? because it's not that the Fed's fully banked, but the Fed's, you know, it's a money printer. So, in order to prevent that, okay, they want these CBDC bans that only focus on retail, but they leave alone a so-called wholesale coin where the Fed does the CBDC to banks and then banks can pyramid on that. And so, the issue there is that the only thing that's keeping a CBDC out of law is that the banks are afraid of it. But if you do a partial ban of retail, then you have taken all the spikes off a CBDC. You have turned it into something that banks catastrophically fear into something that, you know, banks get a cut. Sure, why not, right? And so government itself always wants the CBDC because it gives them control. Uh it gives them, you know, they can monitor what you're spending on, they can control it. They can literally, for instance, they could enforce negative interest rates so that if you don't spend your money, it melts, right? Which would be excellent stimulus for the next time there's a recession and they have an election coming. So, governments always want this, right? They want the surveillance, they want the control. The problem with this partial CBDC ban is that it flips banks uh from being against the CBDC to being pro. Now, people might ask like what the hell is a CBDC bill doing, you know, doing in a housing bill? And that's that's how Washington operates, right? The game is you you you horse trade. You give people things. And in practice, the things you're giving are things that your donors requested. In this case, the bankers want a ban on retail CBDC's, but only retail CBDC's. Ripple also would like a wholesale because Ripple is delusionally imagines that they are somehow going to be the CBDC. That's not how it works. Governments don't give that kind of prime real estate away. But at any rate, that's what Ripple thinks. And you know, Ripple is swinging swimming in so much money because of course they too are a money printer and so they uh I believe that they channel a lot of that money. Um, you know, when I and a team at Heritage Foundation, we were trying to figure out why, you know, cuz like the Republicans were running around doing this partial ban of CBDC and we explained to them, you know, this is very dangerous because this flips the banks of the other side of CBDC. And they kept saying, yeah, yeah. And we were like, so change it. And they were like, can't do that. And we were like, you know, it's kind of like if you're an astronomer and you see this gravitational field and you don't know why it's there, you can see that stuff is is reacting to some gravitational field. And so you you you have to assume there's a planet there. >> You don't see it, but there's a planet there. And so there's there is some gravitational field happening in CBDC's uh that is pushing specifically for this partial ban, which effectively makes a wholesale CBDC, which is still government control. just push a button makes it much more likely. >> So that I was actually going to ask you something along these lines because I think you've described CBDC's as governmentr run crypto with a centralized database which is I think an apt description. However, something we talk a lot about the Bitcoin way is a concern of stable coins actually being this like Tether for example where they already censor transactions based on what the FBI tells them to do being sort of this very seamless uh path to a CBDC and also never mind the fact that the government is completely inept and building out the infrastructure themselves probably going to be catastrophic at best and you know much much worse potentially. Um I mean could you see um like the stable coins themselves being the they're privately controlled you know but really at the end of the day it's it's it becomes a as you describe a governmentr run crypto on a centralized database. Is that something that you could anticipate happening or do you have less concern about that? >> No I think it's a good point. Uh the trick is that a stable coin. So a CBDC is going to be sold as um you know instant transfer zero fee like crypto or you know blockchain technology has certain benefits over centralized systems basically speed and price and you know when I was working with senator's offices for example Republican senators they were excited about a CBDC because for example it would lower the costs of exporting form. Okay, so cross crossber payments are a big deal for the constituents they represent. And so the benefit of a private CBDC uh private a private stable coin is that it removes those advantages, right? So you can have those cost and speed advantages in you know tether for example in which case the CBDC brings nothing to the table. So that's the benefit of it is that it basically guts the use case or the argument and a lot of the political support for a CBDC. The downside is exactly what you're describing, which is that fundamentally any centralized organization that the US government can get its hands on, which is pretty much everywhere in the world. There's like five countries that the US government isn't allowed to go arrest people in. Uh those are always going to be captured to a certain degree. So it's a trade-off. But yeah, the risk you're describing is real. So, okay. So, how likely, if you look out into the future, because I don't know where we're at in the legislative process on something like this, how likely is do you anticipate this uh mustpass housing bill to be passed? What what do you think ultimately gets incorporated in terms of a CBDC stable coin? Like, do you think the yield on for stable coins are coming or do you think they're going to the banks are going to win? How do you think this plays out if you were to guess? Yeah, I think it's a tossup uh on both. Um the CBDC thing is more likely because there's so little attention paid to it. Most Americans don't know what a CBDC is. They're not angry uh about a CBDC. Uh so, you know, I and others try to raise awareness of it. Um you know, most Bitcoiners, I think, understand it, but most normies do not. Uh so that could, you know, slip in there. The stable coins one is interesting because you know traditionally banks have had much much more lobbying heft. They're one of the biggest donor groups. They're up there with healthcare really. It's it's it's those two that own Washington uh healthcare pharma. And banks, you know, traditionally have basically gotten anything they wanted. So they would loosen the rules so they could, you know, take more risk or print more money or get bails bailouts or whatever it is. Uh what we saw with the Genius Act is that if crypto, not Bitcoin, but crypto. Sadly, there's not that much money in Bitcoin because we're not scammers. We we don't have outrageous profits in our industry, whereas uh other companies do. At any rate, there's enough profit running around in shitcoins that they during the Genius Act, they pretty much matched Wall Street toe-to-toe, which is pretty striking. Think that's really one of the sort of unsung uh you you know plate tectonic shift last year was that somebody took on the banking cartel and won. Now they didn't win entirely right so it it did ban um interest for example but it was a toothless ban so far. So I think it's 5050 whether you know does does the shitcoin industry mobilize again so that they can outbid Wall Street. Uh that's really the question. But you you think that's a real debate and this isn't like like Brian Armstrong and JP Morgan. You think this is a real them butting heads and not some sort of political theater where the outcome has been pre-negotiated because I' i've heard that like hey behind the door behind the scenes like these guys are sitting in backroom deals. They know they know what the end result's going to be but they have to make it look like it's the freedom fighters versus the banks or or whatever you know the narrative is. >> Uh it's always possible. Um, you know, policy is a small world and a lot of these guys like there's no laws against coordinating your donations. You know, there's like laws against price fixing, but not uh coordinating your donation to put pressure on people. So, I mean, I wouldn't be shocked if that's what they're doing. The economic interests are definitely on the other side of it. So, you know, like when they come into the battle, they're definitely on different sides of it. uh stable coins uh do stand to drain resources from fractional reserve banking. Uh having said, you know, did they sit and have a steak dinner and work out some compromise that they can both live with? Uh which would probably look like, you know, allowing interest but doing it in some way that it's only capturing the crypto people. It's not capturing the normies. Um and you know, there's different ways you can structure that. Um, so that a normie would like your grandma is probably intimidated by the notion of opening a Coinbase account and then replacing her bank account with it. Now, she doesn't understand that if she were to do that, those stable coins are fully backed, whereas her community bank up the street that puts out cookies at Christmas, that money is actually in some hedge fund in Peru, right? So, she doesn't understand this. But as long as she doesn't understand that, it's not an existential threat to the bank. So you can structure it in a number of ways so that from the bank's perspective, the damage is done within the crypto bros, which is not a large market for them anyway. A, they're young. B, a lot of their money is in crypto. It's not in dollars. >> Yeah. Okay. So, uh, I want to sidetrack us for one second before I move on to the next subject. I'm curious, uh, you mentioned, you know, like you work at Heritage. What is, what's sort of the take on Bitcoin? I still see a lot of gold bug sort of folks from like the the places I would expect to see that. What's been the response? You going really hardcore into Bitcoin. >> Are people getting more receptive to that on the sound money front or is there still a lot of resistance in your mind? >> Yeah. So, you know, I think the funny thing about Bitcoin is it's progressing um birthday by birthday, you know. So the 10 years ago, you know, the average Bitcoiner, whatever was 28, now they're 38. Uh so you do have a lot more people who are in positions of influence in normal organizations who understand Bitcoin, who advocate for it. So you are seeing a gradual shift uh within heritage. When I joined, gold was crazy when I joined in 2021 and Bitcoin was just completely insane. Like you know, you got to see a therapist. Uh so I know Heritage has shifted massively. We are 100% pro gold, pro Bitcoin, uh anti-fractional reserve banking. So we've shifted massively. Most of the think tanks in Washington have not. Uh so they're generally host they they regard Bitcoin as like a sideeshow, but it'd be way too risky to actually use it for anything important. Uh they generally regard gold as a sideeshow, even though of course gold has a heck of a track record. Uh so you know but policy circles like in Washington I think they're several decades behind the rest of the country. So like whatever normal people are thinking about money it takes a lot longer for that to percolate into Washington. >> Okay. Okay. That's fair. Okay. Let's talk about the war in Iran. U could you maybe I'm having a heck of a time following this. There's it feels like every day there's new conflicting information going. I have to hit gro on everything I see on X to see what what I can kind of confirm. What's your assessment of what has happened so far? What's transpired to the best of your ability? And then we'll we'll talk about sort of the economic consequences downstream uh in a minute. >> Yeah. So, I don't think the war has turned out the way that Trump wanted so far. Uh I think the original hope was that you would uh club you know you would decapitate the regime you would destabilize them and then one of two things would happen either what happened in Venezuela which is that the remainder of the government somebody steps in and says I'll take over and can we be friends what do you need from us so that worked fantastically in Venezuela and Venezuela is now basically a client state of the US does what we tell it to or their hope was alternatively that there would be this spontaneous you know, Iranians would rise up uh and they would topple the government. So, neither of those had happened. I think the Iranian leadership is much deeper than we expected. In other words, there's there's more layers who are who are like into this thing. Uh so, they can just keep going. Uh and the Iranian people have not risen up. That may be because 10,000 of them got murdered in January when they did try rising up. So, I don't know if I should laugh about that, but it's sad. Um, at any rate, for whatever reason, the Iranian people have not risen up. The regime is still capable of crushing disscent, of intimidating people. Uh, now having said, you know, Trump, one of the things that I think is unique about Trump is that he takes his promises very seriously. So, I know from working in Washington, the people in the administration, there are people in the White House who sit and track every single thing Trump ever promised. And you know, they're very eager to get a checkbox on that. Okay, most presidents don't. They just say crap. And Trump looks like he just says crap, but he actually does take that stuff seriously. And one of the big promises that he made in this war, even more than whether we get their uranium or the straight of Hormuz or, you know, whatever the outcomes are, one of the biggest things he promised was four to six weeks. So I think that the war has not gone as maybe you know some of the promoters hoped. However, I think that Trump is very eager uh to stick approximately to his timeline. Pete H said I said to stretch that to maybe uh uh 8 weeks or so. But I mean we're we're coming up on that. We're about two three weeks away. So, if you look at sort of personalitywise, you know, you've also got the midterm elections coming up. Um, even if oil prices go down tomorrow, it takes a while for the economy to recover from all this. Uh, it also once the economy recovers, there's also a lag with perceptions, you know. So, like if um if companies are firing people, if prices are going up, your paycheck doesn't make ends meet. If that fixes, it still takes a long time for voters to feel like that fixed. So the question is getting that in there by midterms which you know they're what seven months away but when you're talking about economic perception seven months is not very long. So there's a bunch of things that are pushing for a short war. On the other hand if you look at uh you know you can look at uh prediction markets say that we're probably 50/50 that it'll go into June. They're saying 25% odds it goes into 2027. If you look at oil futures, those are saying basically August uh is when oil futures start coming back down. So the difficulty at this point is like sort of everything is on hold. Uh you know, Bitcoin prices, gold and silver prices, um the economy in general, markets of course, all of that is on hold for the war and nobody has any idea how long the war is going to go. Trump is almost uniquely chaotic. Uh I think that is absolutely intentional. He wants to keep the other side uh you know offbalance but the end result is you know you're even seeing now like when Trump makes some noise how the war will end soon the market reaction is relatively muted. You know today he he sort of floated that uh you know we might drop control of Hormuz uh which raises the pro prospect of a much shorter war and the market jumped but it didn't jump as much as it should have based on that. So, I think that at this point, you know, on Wall Street, they're calling it headline fatigue that just nobody knows what this president's gonna do. I know because I make daily videos, right? And so, you know, I have to like make the video the night before and I lay awake in a cold sweat wondering what the hell Trump is going to do tonight because maybe like tomorrow's video, you I don't know, maybe he'll win the war or he'll, you know, what like who knows? So, >> um so it's tricky um being an investor. Now, of course, if you're a true Bitcoiner, you hodddle. You don't care what's happening, and so it's not that big a deal. Uh, but for, you know, for I mean, I guess you could argue there's there's like another sigma class of Bitcoiner where they do care because every last penny is in Bitcoin and they got to pay the rent. So, I guess for those people, they would care. >> So, what So, I I just began learning and I'm scratching the surface as to how oil and energy flows about the world. If if Trump what you what you alluded to there, Trump's comment that maybe we end the war and the the the strait stays in Iranian control or it stays closed or or blocked, you know, largely. What is the what is the impact on US economy, I guess global economy, if that were to continue to be the case, even if the war ended because to me that seems that's from what I'm gathering that's highly consequential or could be. Is that fair or no? Uh well, it's consequential in terms of the US exiting the war and the way that it's being framed a lot in the media. Uh they're focusing on his comments saying that the rest of the world has to handle the straight on their own. So if they want the oil out of the straight, then you guys have to go take it. You have to man up, grow a pair. Realistically, if the US declares victory and goes home, then at most Iran would put a tax a toll on ships going through the Gulf. They're already or going through the straits. They're already doing that. Uh I don't know if they're doing it today, but they were doing it in the recent past, but they were charging each ship $2 million. That comes out to about a dollar a barrel. >> Okay. >> So, like they'll just pay it. You know, realistically, the Europeans, Japan, Korea, they do not have the force projection where they can actually do anything about it. Iran's neighbors don't want to do anything about it because it would be a mess. China is sensitive, but they also don't want to do it. I think what China is afraid of right now is that their air defense systems are apparently garbage. There's speculation that they executed the guy who was the head of the uh missile defense, right? It failed in Venezuela. It failed in Iran. Uh he's either disappeared or he's executed. I think China doesn't want to do anything militarily because they're concerned that all of their stuff is garbage. And if the whole world knows that, they lose leverage with Taiwan. They lose leverage with India. Like they have a lot of neighbors who they have various conflicts with. Vietnam, you know, they're sort of in a permanent cold war with Vietnam ever since they got their butts handed to them in the uh in the 70s. So I think China definitely doesn't want anything. So worst case scenario, which I think would be a nice scenario is that the US declares victory and goes home and I, you know, Iran probably tries to tax oil. Uh Dubai and Saudi and Iraq won't like that. But you know what? They they they have big beautiful militaries. If they want to do something about it, they can. So, I just had a tweet earlier where I was saying, you know, that it's it's too early to dream big, but there is the possibility that because of this war, NATO could break, right? Trump's fighting with NATO because they're closing their airspace when, from his perspective, we need them. So, NATO could break and maybe we could shift the rules now where like China has to protect its own oil. Like, we don't do it for free anymore. >> Interesting. Interesting. So what to what extent have you like as you've watched this unfold the war? What are you like like I I I tend to imagine that the average normie probably isn't seeing this but there's probably some metric or some data that you're seeing that you're like man like this is a glaring example of just how fragile the fiat system is. The supply chains that fiat have constructed are. Um, is there anything in in particular you could point to that if someone's like not really clear on why, you know, why fiat is garbage and why Bitcoin might fix some of the the challenges we face that you're like this war demonstrates that? >> Well, I think the biggest takeaway is that what fiat does is enables all of these adventures, right? So, you know, if you go back, I mean, really for the past hundred years, every time governments screw something up, the way that they get out of it is that they shoot a tr their central bank shoot a trillion dollars at it over and over until the problem goes away. And the end result is that every crisis converts into inflation. But what it also does is it finances every crisis. So like the central bank becomes the venture capitalist of the crisis industrial complex. So you know America let's see we have a close to $2 trillion deficit at 7% of GDP that is deep war level okay we were at relative peace the past couple of years 7% in peace time is obscene that's you know third world basket case territory uh and why is that possible because the Fed stands ready to print it all the Fed fundamentally backs stops it with a giant money printer the example I like to give is COVID, right? So, if you imagine imagine some random country like Canada and you get the COVID thing and you have the the the staff meeting and they all say, "Okay, so what are some options?" And let's say you don't have a central bank. So, you have some junior bureaucrat who says, "Okay, I got a crazy idea. Let's shut down the entire economy. Tax revenue will drop by half or more, but that's okay because we just lay off all the federal workers. We can just, you know, we just cut all the government expenditure." So you would get fired, right? You would get sent to like, you know, the deep north up in >> Yeah. You'd be out of here tomorrow, right? The only way that that plan could work to shut down the entire economy and pay all the voters to sit on the couch so that they support uh lockdowns and, you know, they they they watch dancing nurses instead of going. The only way that you could make that work is with a gigantic money printer. >> That's exactly what happened, right? So they did the lockdowns. They they you know did the virtue signaling. I uniquely care about grandma. You, you know, antivax, bozos, have blood on your hands. Very, very expensive virtue signaling, right? It cost them, I think at one point it was 7 trillion that the Fed balance sheet increased. Uh, but you know, they they they were able to do it. And not only could they do it, but shooting all that money at it made everything go up, >> right? It was weird. Like you shut down half the world economy and all the stocks went up, Bitcoin went up, gold went up, everything went up. Amazing, right? Because they shoot the money. The money first goes into markets and then it dribbles out into consumer prices. So the, you know, when I look at this war, the near-term, the fiat is helping in the sense that, you know, like everybody knows markets know if everything goes to hell, then they'll just shoot money at it. And so, you know, the the so-called Fed put. Uh but the wider issue is that the reason that we are in this war, the reason that we were in all the wars, the reason we were in World War I, as Safety discusses, all of those are because of central banks. They are the venture capitalists of the crisis industrial complex. >> Interesting. So you mentioned Venezuela. I I have to ask uh to me that like I I feel like I I woke up, saw the news, blinked, and then we moved on to something else. Uh we did depose a world leader. Um and and and to be fair, we had um like I I'm not an interventionalist. You could probably guess that about me, Peter, but um we we had someone come on his spaces that we did who was from Venezuela living in the States, and he was talking about how he's like, "Venezuelans are cheering this on." Like it was >> for sure. >> It was bad, you know, and and I can sympathize while not agreeing that I want my tax dollars or, you know, my children to have to pay debt on some intervention that, you know, doesn't directly affect me. But what was your take on was that was there maybe like a more uh like like it it felt like just this uh impromptu like we're going to just pull this thing together but then I hear about people talking about hey migr migrating to a multipolar world we need to own the western hemisphere with with the Monroe doctrine like how do you look at what happened there and is there sort of a continuing story in the background that we're so focused on Iran now that we're not even seeing with Venezuela. >> Yeah. I mean, so the Venezuelan regime is garbage. They're communists. Um, I encourage anybody to depose communists at any time for any reason, uh, using their own money and their own lives. Uh, of course, I don't want the government to do this because there's a lot of crappy regimes in the world and we would, you know, we would spend everything we have uh, doing it. Plus, we're already two trillion in debt, which is, you know, already inviting a financial crisis. So, I would prefer we not do it. uh but having and you know the whole dominating the hemisphere you know Switzerland dominates nothing right it has no external military it invades nobody it has no sphere of influence lienstein is arguably a sphere of influence it dominates nothing and it does just fine why because it goes out and buys crap okay can buy lithium and it can buy oil and it can buy food and all the rest of it so it's you know to me it it it's a fallacy like why do Why do you have to dominate stuff? Like to what end? >> You know, our our being a major player in the Middle East, what precisely has that done for us? >> Us being influential in Africa. Again, what exactly did we get for that? >> So, >> I I I think it's, you know, I've met Venezuelans. Uh they are absolutely thrilled at Trump. Uh they love the fact that he told the oil companies, you can't just take the revenue out, you know. um like the oil companies had long-standing lawsuits from when their uh resources were seized by the government. He said, "No, no, no. We're going to put those on the back burner because the resources are for the Venezuelan people." I think if you're Venezuelan, you should absolutely love this president. I mean, he's just been astounding. However, that's not his job. And he has said this a hundred times. He said, you know, when people talk about how nobody likes you in Europe, and he says, "My job's not to be liked in Europe." His job is not to be liked in Venezuela. I sympathize with Venezuelan people. I encourage any, you know, board billionaire to go raise an army uh and go do it on his own. But fundamentally, yeah, it's it's not our war. There's a lot of wars in the world and we can't afford them all. We can't even afford what we're doing now. You got a lot of Somali learning centers that need to be funded. >> Exactly. Exactly. There's uh Yeah. And and potholes that need to be paved would be my preference. Um, so, so do you think the reason for that are you optimistic about Trump's intentions that it was help the Venezuelan people or was this an oil natural resources play? Is there something else happening that is or at least that Trump perceives to be benefiting the American people long term or something else? >> Yeah, I think for better or for worse, Trump whatever filter Trump used to have is not there anymore. He gives speeches now where he's like, you know, I like to be around dumb people. some people, you know, I I don't like people who are too smart. He he the man has no filter. Okay, he like tactically that's that's not a good thing to say even if that's true. At any rate, he's got no filter. So, I honestly I take it at his word. I think he invaded um some sympathy for the Venezuelan people. I think more of it was that the Venezuelan government was causing a bunch of problems, right? They were um sending the narco boats. That's a legitimate issue. the number of Americans who die every year from overdoses is roughly the number who died in the entire Vietnam War. That is like a legitimate self-defense uh issue. There's other smaller things. For example, Venezuela was not, you know, they they emptied their prisons to a certain degree and just dumped them all north uh so we could play so we could have them and they were not taking them back, right? So, we would arrest these criminal Venezuelan uh migrants and then Venezuela would say, "Yeah, no, we don't want them." You know, >> figured out. >> I don't know that. So, I mean, there were some legitimate grievances. I think the the single biggest one was that he genuinely doesn't want China um having influence in Latin America. You know, China has been very big into buying friends with the checkbook. Uh I mean, frankly, I don't know why we care if like Swisilland is friends with China, like you know, >> right? >> Yeah. What are they going to do? So, >> it doesn't bother me, but I think that it does bother Trump. He wants the US to be the uncontested uh power at least in the Western Hemisphere. >> Okay. And we we'll get out of uh Central America, South America here in one second. But in the midst of all of this, I saw the um we were doing some sort of an anti-terrorist campaign in Ecuador. >> Was Was that just that and it it happened to come on my radar or was there in your view some other play at hand? >> We I mean we do those everywhere. I think uh you know people have tried to tally how many bases we like formal bases we have I don't know 150 it's it's >> it's astounding you know every so often you only hear about it when somebody gets killed and so like somebody will get killed in what was it the other year Niger or something and then people were like what why why do we have soldiers >> yeah so >> yeah I the good thing is all of our intervention is uh teaching peuh Americans geography that they don't learn in public schools Which again, what are you gonna do with that? What are you gonna go vacation in Niger? But >> everyone knows where Ukraine is. Everyone knows where Iran is now. >> Everybody knows where a straight of Hormuz is now. >> Yeah. And we're all experts on it, too. Yeah. The the the yen carry trade. I became an expert on that overnight. >> That's true. That's true. Yeah. >> So, uh let's talk a little bit just sort of macro, I guess. We US debt recently hit $ 39 trillion. Um I think the um uh what would it be? The CBO uh is is looking you know a decade out and we're we're talking the US debt doubling here very very quickly and it tends to be very conservative projections obviously that the government's going to put out. Um what do you I mean I I assume you agree that's going to get higher higher higher. Any other comment on on that before I I proceed with questions though is uh is that where we're where we're going? >> Yeah. Yeah. I think absolutely uh it's going to keep getting higher. You know, unfortunately the incentives are there is no predator there's no natural predator spending in Washington and everybody no matter what the party uh you benefit you as a senator or congressman or president you benefit from spending more. So everybody wants to spend more. There is no counterveailing force. The only limit on it is um either a crisis or going back to that central bank with the crisis industrial complex. You know, if you get a crisis, the Fed will shoot the trillions at it. Get out the bazooka trillion after trillion till it goes away, which converts into inflation. So, I think fundamentally it will keep going to a crisis. It will probably take longer than people expect. You know, people in the 1970s thought that we were right on the edge of apocalypse and 50 years later, we're not. Anybody who invested the apocalypse in 1978 lost money. Uh so, you know, it'll probably take longer than it seems. But unfortunately, I think there's, you know, we just had a natural experiment with Doge where Trump, believe it or not, had been hostile to to federal spending. Every single budget in his first term, he tried to cut 10020 billion, big money back then. every single time Congress walked away. Uh Doge, of course, you know, Elon is force of nature. He can do things no mortal can imagine. Uh bounced off Washington. Didn't even make a dent. Uh by their own tally, Doge claims 200 billion in savings. Well, that all got gobbled up in a single year from Medicare, Social Security, Medicaid, no doubt welfare fraud. It gobbled all of it up. And that was one time Doge. That was one year it gobbled up. next year it's going to gobble it up again and again and again. So we just had a natural experiment. We had the perfect storm. We had, you know, Republicans promised they were going to slash federal spending for 50 years. We had unified Republican control. We allegedly had fiscal conservatives. We had Elon Musk, you know, possibly the most capable human on earth heading this thing up. We had Trump who by all accounts is he is very hostile to the federal government. He does not believe that is a force for good. All the stars aligned. every single planet was in sync. Nothing. So, I think the takeaway from that is it's hopeless. And I think that's why gold and silver were taking off before the war, right? They exploded last year. I think silver was up 3x just numbers, right? They were both in backwardation, uh, indicating severe supply stress. So, I think that precious metal saw that. Now, Bitcoin, I think, didn't move up because Bitcoin still had a big run that came from, you know, there was a lot of hope when Trump won. He said he was going to pay the Bitcoiners back. I think that has not turned out as much as people might have expected. So Bitcoin sat that one out for that reason. Or put differently, it got his rally early. But Gold and Silver basically said they took one look at what happened to Doge, you know, given the Republican Congress, given Trump, and they said it's game over, right? There is nothing stops this train as Lyn Alden says. >> Yeah. No, I think that seems that seems about right because uh like I I was I'm I'm no longer real optimistic when anyone takes office even if it's someone who I >> you know align with or I like some of the the things that they say. To me I just I look at the um kind of to your point there is no one who is incentivized to go after the spending there. There are too many handouts votes to buy or or you could say accumulate if you if you want to be a little more uh gracious. Um, but I I would have guessed I knew Doge was not gonna fill the deficit, right? That that to me just seemed insane. I was a bit surprised that they couldn't muster up a little bit more political capital to do something meaningful that wouldn't be gobbled up in the first year. Uh, but maybe in retrospect that, you know, >> I kind of threw my hands up. I don't know if uh like going into Doge, what was your anticipation like? Did you think they were going to bounce right off of Washington or did you think there was a real a real shot at making some meaningful impact? >> The problem is that if you're really going to make a big impact, there's only so much you can do as president. Uh, a lot of it has to come from Congress. Um, because there are these forests of laws that are passed in there. They're crony laws and they protect all this stuff, right? So when people complain about the Obama judges and the Biden judges, those guys are downstream of these corrupt laws that are stuck in there by Congress because some donor paid them to. So to get rid of all of that garbage, uh to get rid of the spending, to, you know, get rid of the fraudulent, you know, all the money going out to Minnesota and California to do all that, you need Congress to do it. And Congress cannot do it because of something called the filibuster, right? So you need 60 votes to pass. Almost never does one party have 60 seats. There was a time when they would horse trade and they would sit the back room over cigars. They would cut deals. They don't do that anymore. So in practice, nothing major can get past anymore. So we're essentially frozen more or less at the FDR revolution. So you know FDR gutted the republic's essentially a constitutional coup. Uh he, you know, imposed this administrative state, the deep state. that is essentially frozen in place because of the filibuster. Uh now I guess the good news, the short-term bad news, long-term good news is that it looks like the Democrats are planning to cut the filibuster next time they get power. Uh if they do that, then shortterm a lot of terrible stuff happens. Basically, whatever Camala promised happens if you get rid of the filibuster. Uh, however, it moves us a lot closer to finally being able to break this log jam because, you know, what I think the past year has shown us is that the the FDR superstate is indestructible the way it is. You can't get it out without breaking the filibuster. >> Okay. So, are you a like do you adhere to the thesis of the big print? Is that is that what we do with the 39 trillion in debt, the war, the everything going on? like is are you and Larry Leard pretty well aligned on uh on where you think this is headed? >> Yeah, I think absolutely. So, all right, take uh Biden inflation. So, depending on how you counted, it was at least 20%. That effectively paid off 8 trillion of debt or what 7 trillion of debt, >> right? So, you know, because when you have inflation, the economy keeps up with inflation sort of by definition, but the debt does not because the debt is in nominal dollars. So that effectively that was the biggest like forget the 1990s, right? Biden inflation paid off an enormous amount of debt, $7 trillion in debt. Now it did it in a horrible way, right? It did it by gutting the American people and impoverishing us and now, you know, kids moving in with their parents is at Great Depression levels. I mean, it was it was absolutely horrific. But if if the only thing you care about is the debt to GDP ratio, then you loved Biden inflation. You would want a heck of a lot more of it. You know, famously the VHimar government in the 1920s, the national debt was eating the country alive. I think it was three or four times GDP. This is from absolute memory. Anyway, it's very large. It was larger than our uh debt is today. And they had a couple years of hyperinflation and then the national debt cost the same as a loaf of bread. So that's the concern is that if you let things keep running and you know we've already got the template or I was talking earlier about the Fed shooting a trillion at every crisis we already have the template right if anything goes wrong every time short-term uh interest rates spike for example which they do about every two three years now that used to be called a crisis now the Fed just shoots money at it right so all of these disasters they all convert into a big print now they're going to try to make it go flow because I like to joke that we don't have a gold standard but we have a pitchfork standard which is that you know like why does the Fed try to keep inflation around 2% there's no scientific reason for it is because they know empirically that's you go beyond that and people start getting upset and then they start putting pressure on Congress then Congress you know starts to clip their wings so in practice you know it's it's like a gasoline thief you know you you you take one gallon a night you don't you don't drain the whole tank at once right because they're going to notice that right? You take a little bit take like a quarter gallon every single night. You're going to make a lot more doing it that way than than you will stealing all the gas all at once. So, you know, I don't think it's going to come all at once. They are going to try to restrict it. Uh central banking has it kind of down to an art where, you know, they can just shave off a little bit here and there. Uh and by the way, they steal a lot more than it looks. They don't steal 2% a year, right? People think, okay, 2% inflation, so the Fed printed or stole and gave to somebody uh 2% of all the money in the world. No, they took a lot more than that because a an economy naturally is deflationary, right? Because you have all the money in existence, you have all the stuff. If your population goes up, if you're more productive, if you're using computers and and AI and whatever to make more stuff, then you have more stuff, you have the same dollars, so you actually have deflation. The stuff gets cheaper. So what the Fed manages to do is soak all that up. Probably the biggest deflation we had over the past 20 years was China, right? So when I was a kid, buying a toaster, you had to think hard about that. You had to like shop around. You had to go by Consumer Reports and figure out which toaster was good. Why? Because adjusting for inflation, they were like 150 bucks, right? Today you can get a toaster for $7.99. Maybe not today today, but they're very, very cheap because of China. So, China was a massive deflationary uh impetus that created, you know, political issues because it stole a lot of jobs. But in terms of inflation, quality of life, consumer spending, we should have just gone through over the past 20 years, we should gone through this massive deflation, right? We should have got like 30% deflation. All of that was gobbled up by the Fed and handed to, you know, Wall Street, to the federal government, subsidizing debt. So they take a lot more than it looks probably on the order of 600 700 billion a year right so that effectively you know they're they're borrowing so much that the debt keeps growing but if they get to a crisis you know a lot of the sort of black pill crowds imagines that you know there's going to be this great crash and and then the righteous shall prevail and no it'll it'll all convert into inflation which is nice if you happen to be a Bitcoiner or a gold bug silver is a little bit trickier uh you will inherit the earth >> it's It's so interesting. I actually had this conversation with a friend recently. I was explaining that even if you take them at their 2%, you know, CPI, like that's how you perceive inflation. I was like, first of all, that's not really what inflation is. I mean, look at monetary inflation. You're looking at probably seven, seven and a half, 8% or something like that over the last two decades. And so that's really what they're stealing from you because you know that 2% is a lie. But prices should be decreasing by, I don't know, let's say 3% a year. Like the delta is 10%. Like that's that's what you're being robbed of. Like you could be getting 10% wealthier each or at least you you could be uh you could be 10% better off I guess you might say. And uh it's just so distorted. But honestly, it's it's the u it's fractional reserve banking, central banking. all of these forces that are so opaque to most people that you have to really be interested and really be curious and study hard and read a lot of books and listen to a lot of good podcasts uh that most people just have no idea like if they heard what you just said I think they'd be they'd they'd completely misunderstand just how serious you know the situation was >> and you know if you paint a picture of what's possible I think that's really important for people like like they might understand um Bitcoin on a life raft, you know, view like okay, I can understand you want to protect yourself from the fiat system, but in terms of the wider question like what happens to society if you return to sound money and there you know you can look back at the period before the you know two worst policies in American history which were the income tax and the federal reserve. Those came at the same time. They essentially gave the government the ability to seize end like unlimited quantities of society's resources and then use those for wars or cronies or whatever it is. So you can look back at the period before then. I call it the top hat singularity but the period from about 1875 to 1913. It is an astounding period. Everything was invented. If you take every single thing that Elon is famous for, every one of those was invented in that 40-year period, computers, hyperloops, rockets, airplanes, helicopters, everything. Magnetism, electricity, telephones, everything was invented in that 40-year period. I think people have no idea what we've lost. Since then, we have been running on the fumes commercializing everything that was invented in 1875 to 1950. So 13. So in other words, if you imagine a counterfactual where we did not do the Fed, we did not do the income tax, therefore we did not have World War I because there was nobody to finance it. They would have mucked around for, you know, six weeks and uh, you know, on the border and called it a day. If we didn't have those things, we >> It's depressing to think where we'd be. You know, like Starbucks, >> people working in a Starbucks would make a quarter million, meaning that they would only do it for like five, seven years and they go backpack for their, you know, people would retire at 35. Immortality. Just imagining all the things we would have if we hadn't strangled it in the crib in 1914. >> Yeah. I I've said before that um if that it's it's hard to imagine a world where we hadn't hampered nuclear and where we could we could have accepted Bitcoin in 2009 as the form of money. like you combine those couple of things and and you're right I've actually given those examples before I think the combustion engine was invented around the same time >> like like I I was trying to explain this to another friend this was like a year ago that all of the cool things Elon does or you know anyone you know name your tech billionaire all of it is incremental improvement on technology that is 120 years old all like all of it and and they're like no this is like the most techn technologically crazy age. I was like, "No, imagine going from I have to open my windows when it's 95 degrees out just to get some just to get a a breeze to like I have air conditioning in my home. I can be comfortable 24 hours a day. That is a way bigger lifestyle upgrade than Elon shooting rockets off, which has no bearing on my life, right? So, I think it's uh it's just hard to conceive of if you if you don't go do the do the studying of the history." Um, Peter, uh, I I actually just typed this down because I hadn't didn't have this on my list, but tariffs. I have completely lost track of where we stand on tariffs. I was following this for a while. Uh, I I would love your opinion on tariffs generally, your just your view of uh, tariffs uh, as as an Austrian and um, uh, if you if you have any sense as to where we where we currently stand with uh, you know, 200 some odd countries, uh, would love to hear your analysis. Yeah, it kind of dropped out of the headlines. So, broadly speaking, a tariff is it's a form of a sales tax. It's a sales tax on a particular class of goods, imports. Like all sales taxes, it's therefore, you know, evil. It it transfers the resources of the government. It drains the lifeblood of the people, etc. So, tariffs are terrible for the same reason taxes are terrible. Having said there, Trump had two goals with his tariffs, which is why I've been generally going easy on them. uh which are number one to get other countries to reduce their trade barriers which you know if you can threaten other countries and they remove their trade barriers and then you remove yours that creates a better world for everybody. I think everybody agrees that uh the second one is to reshore production. So to bring factories back to America that worked with Ronald Reagan for example he threatened the Japanese with tariffs. They move production to the US to the point where uh almost half of Japanese cars sold in America are actually made in America. And the Japanese don't care, right? They just want to make money. Okay? They'll make it in America. They'll make it in Japan. They'll make it in China. They don't care that much where they produce it. The country of Japan may be nationalist, but Toyota doesn't care, right? They're paid to make profits. They don't care where they make it. Uh so those were the two goals. Now the reshoring I think is that was turning into the more interesting of it because Trump the way that he was negotiating with countries was he was saying look I can hit you with this catastrophic tariff or you can build a bunch of factories in America and I'll let you off easy. And that's what countries were going for. So Korea, Japan, uh Europe, Taiwan, uh Saudi Arabia, the Middle East, all of these guys, they were promising a combined, it was over 4 trillion of investment that they were going to build. So you know, Taiwan uh semiconductors building a hundred billion dollar plant in Arizona. It's a whole bunch of projects. And the rule of thumb is that every trillion dollars is worth about a million jobs, right? So that's that's enormous, right? That would cut our unemployment rate to half. That was a very big deal. So this is what Trump was getting, right? He was threatening with these massive tariffs, you know, 40%. And the country would say, "Okay, you got me. I'm going to take all like Taiwan took 99% of its tariffs off American goods." It was obscene they ever had them because we protect them for free. But anyway, setting that aside, they got rid of 99% of the tariffs and, you know, they sent, I don't know, 300 billion or something. Uh, which would be uh what that'd be about 300,000 jobs that they were going to be creating in America. So Trump has been very transactional, has been very very clear. Uh Japan, Taiwan, Korea, they understand their their med I mean they're smart, their media is a lot smarter than ours. And they sit down and say, okay, they say, look, Trump is transactional. Here's what Trump wants. You know, he wants he he wants factories. He wants the trade bear. He want D. And they sit down and they give it to him to stay on his good side. Uh so in light of that, right, on the one hand, tariffs on themselves are bad. On the other hand, Trump was getting so much good out of them. And you know, if you look at most countries, uh, like in Africa or Brazil for example, tariffs have failed catastrophically. When you read like in the economist magazine or the financial times and they criticize tariffs, they're thinking of those tariffs. Now the key there is that if you pass tariffs and you fail to make it attractive to produce in your country, right? This is what typically happens in Brazil or Africa or somewhere. They say, "Okay, we're going to tariff everybody, but if you try to produce here, you know, the tax rates are going to be astronomical. The red tape, you're going to bribe everybody. You know, who knows if the minister of whatnot um wants to give your business to his son, maybe he will, you know, property rights, right?" So in those contexts, yes, tariffs are catastrophic. Brazil, Africa should not have tariffs. They're not adult enough to handle tariffs. Okay? But what Trump was doing here was first of all, he was frankly extorting the foreign investment into the country. Secondly, he was trying to get tax rates down, right? He cut the income t the uh corporate income tax in half, which is the most important for investment. Uh he was cut, you know, he cut taxes across the board. the one big beautiful bill which extended his first term tax cuts slashing regulation right zero help from Congress was you know he got rid of the global the carbon dioxide endangerment rule which claims that CO2 is a pollutant huge uh issue in manufacturing basically wipes out small manufacturers so he's he was getting rid of the two biggest problems to manufacturing in America which are the tax rates especially for small businesses and the regulations so If you're doing that, if you're putting tariffs on, you're actually making it attractive to produce in your country, right? Just kind of to imagine the end result of that. Like if Trump were king, then he would put the corporate rate at zero. He would get rid of all of the regulations, you know, basically roll us back to the 1950s when, you know, people were not eating each other in the street, but we didn't have this this this crony um regulatory state laid on top of it. If you were to do that, you wouldn't have to threaten countries. Everybody in the world, like every Japanese company would be trying to move to, you got zero tax, you got less regulation, you know, it's we have tons of oil, tons of resources in the US, they would be falling over themselves to move here. So, in light of that, I think that it, you know, that's why I've been supportive of his tariffs, even though in general, uh, I oppose most tariffs. Now, where do we stand? the Supreme Court struck them down uh under the law he was using which is called YEPA. Um there's uh three other laws with four other authorities. So things like discriminated against US exports, uh national security threats, which by the way they're using national security for upholstered furniture. So it's a very expansive definition in Washington. So they could basically block anything through these other laws. The thing is that those have to be litigated as a process. So that's slow. So, what he's trying to do in principle is to replace the Yeba tariffs. The YBA tariffs were super clean. That was uh you could declare an economic emergency and just hit anybody with anything. These other tariffs has got to go through step by step. So, he's trying to recreate them. He's trying to homebrew them. The problem is that that takes time and all these countries that were going to invest billions or trillions of dollars, they're all waiting to see how that pans out, right? Because maybe they won't have to do it. >> Yeah. Yeah. Yeah. So, so you would say you're uh you approve of the notion of tariffs in this sort of unique case by virtue of the context in which they're happening, the intent that you perceive there to be. How would you rate the execution? Because this this when we were talking about this on our show, it it just felt like we were getting jerked around with, okay, we're extending, you know, no tariffs until this state and then this date and then we're going to slap a new one on. And on one hand, maybe that, you know, I've heard enough references to 4D chess to be skeptical. Um, however, I don't understand how a lot of this stuff works in practice. Maybe there's maybe the volatility that we saw with the tariffs was by design. I What do What do you think of that? >> Yeah, that's the great debate with Trump is, you know, in the back of his mind, is he running a TV show where he's got to keep it interesting every month and so something weird has to happen? It feels like >> no or or or is it for DJs? So, you know, the the the charitable take I mean that would be that this is intentional. It's a way to force countries. You know, I think that partly when he first came in he wanted to communicate to countries that, you know, for a long time there's been these very narrow norms of what the US would do. Like if you piss off the US then we'll, you know, do this tiny little whatever. will um not issue as many loan guarantees for your companies or like just tiny little tweaks, right? And I think he wanted to send the message that look, everything's on the table with me. All right, I I will I will take Greenland. I mean, I I I will do things you haven't even dreamed of. Uh so I think that was absolutely intentional, right? Is to raise the threat level. Uh and his goal is is to get countries to fold. Uh I don't think he wants to go to war with countries. He wants to bully and intimidate them. And you know that's his job. He represents the American people. He doesn't represent the European people. Screw them. >> Uh his job is not to represent foreign countries. Um now I encourage Europeans to have nationalists who represent them. I don't you know I don't I don't dislike Europe or Korea or whatever. Uh but the job of every country is to advocate for itself. And I think that that's what the bullying was. Now having said uh you know yanking them around does something interesting because if you yank the rates around enough at some point countries just they can't make a deal anymore. Like in other words negotiation becomes impossible. Um you know there's a famous game from the 1950s called chicken where you know two two hot rodders aim cars at each other and then whoever swerves first loses. Right? He's the uh the weak guy. You got to be careful about words. I'm not I'm not exactly sure whether it's going to post. He's a weak guy. At any rate, um but well, there's a way to win chicken, which is that you remove your steering wheel and you hold it out the window. Okay? So now the other guy has to he's got to turn. If he doesn't turn, he's literally dead, right? So you indicate to the guy, I can't turn. And so in this case, if you yank the rates 20%, 10%, 50%, 70, 120. If you yank them all over the place, you're basically saying that's a steering wheel. I can't negotiate with you. Your companies have to move here. >> So that's an interesting question where at some point the companies, you know, they can't walk away from the US market because the US is one quarter of the world economy. I don't think Americans understand how dominant we are. We are, you know, a quarter of the world market. We tend to be the highest income consumer. So you make like there's a lot of industries where you make all your profit in the US and then everything else is just gravy on top of that. So they can't walk away. So, if they can't walk away and the tariffs could be 70% tomorrow, at some point you say, "You know what? Screw it. Just build a factory in North Carolina. The the wages are cheap. The energy is cheap. The energy is like a third the cost of Germany, half the cost of Japan. Just pull the trigger." So, it may be intentional basically holding the steering wheel out the window. >> That's interesting. Okay. So my last sort of topic I wanted to cover with you is just broadly the US economy because I've seen you you've you've done a a number of videos on trying I I I didn't even like prepare this question exactly but I I saw you talking about uh like number of college grads who are not um who aren't able to find employment in their uh in their field of study or or at all probably in many cases um obviously like rising healthcare prices you go down the list I I feel a bit insul As a Bitcoiner, I feel a little bit insulated from what I see on some of your videos, for example. But the data suggests that there are a lot of people struggling and we've seen unemployment at like the big tech companies. AI is going to obviously replace many uh at the very least I think most people agree a lot of white collar jobs are probably going away because of AI at least over the next few years. um like what's your what's your take on what's what is actually happening on Main Street that maybe you don't hear in the political narratives that you don't see on mainstream news and what do you think this looks like for the next you know 5 10 years is does it get better does it get worse do they just blow a trillion dollars at the problem like what's the what's the exit for it >> yeah I think economically Sorry. I think economically we are in one of the golden ages of all history because of technology, not because of the government. The government is trying to screw it up as as much as they can. Uh and you know this is partly things like AI, computers, uh the internet, even just computers and the internet, they they have not finished uh raising productivity, raising incomes. Uh a lot of it is foreign countries, you know. So uh if you go back 30 years ago roughly 1 billion people in the world were were really productive in the global economy. Now it's like four or five billion. Uh you get innovations you get you know if you look at Chinese manufacturing for example it's genuinely impressive. Uh there's a lot of fields where the Chinese are actually leading edge. Couple years ago the city of Akran wanted to have like a hundred-y year anniversary of of uh um like highlighting Akran's history in glass. They were like the se the silicon valley of glass 100 years ago. So they were going to build this curved glass wall to to you know show off because that was invented in Akran. The thing is that no American company can make a curved glass wall. It's a 100 year old technology. Nobody can make it here. So they had to buy it from China. You know Akran Ohio did not want to buy from China. >> Right. >> Right. Because that was going to be in the news. These are all union guys. Okay. They tried. Impossible. Uh so if you look at from a technology perspective, I think we are in absolutely a golden age uh in terms of rising incomes. The government is of course going to try to take everything it can but again putting that in perspective, governments have been rapacious for 100 years. Uh there have been many times when people thought that the end was nigh and you know it gets postponed. And the reason is that what governments are doing is parasiting some of that technological advancement, right? Like with China, right? They they they gobble it up. They pay the cronies. They buy the wars. They do all this. So what they end up doing is, you know, tech moves us three steps. Government knocks that back one. I think most likely that process is going to continue. Um I think the biggest fear that people have right now is jobs. Uh specifically with AI, but it's not just AI, right? It's it's factory automation. Um, you know, if you look at the jobs lost since since 2000 in manufacturing, for example, only about a third of that was China. Twothirds of that was automation, right? So, if you go into an American factory nowadays, remember I visited a rubber factory in Kentucky a couple years ago. And it's amazing, right? Every workstation had either one guy or zero guys just having a little alarm that would call the guy over if something went wrong. You had like, I don't know, 15 steps that each had zero to one person. And then you had a last step called flashing where they cut off the little little nipples on the on the rubber. Okay? And that had like 80 80 women sitting there with scissors, right? And you're just looking at this thing and like you can see the process, right? One by one they replaced, you know, because each of those steps probably had 10, 20, 30 people. So, you know, it was a whatever a 7,000 person factory and it shrink shrink shrink shrink. Uh so that's all going to continue, but that's that's been going on for 150 years. Arguably it's been going on for a lot longer than that. You know, in ancient Greece, uh they worried about oxen replacing farm workers, and they'd have all these extra men who wouldn't be able to raise a family, so you'd have to send them to war or else they were going to cause trouble. In medieval Europe, it was water wheels and uh windmills were going to take all the jobs away. Uh the industrial revolution, of course, that was going to wipe out all the jobs. Uh the internet was going to take away all the jobs. This is going to replace all white collar workers with spreadsheets and um and word documents every single time, right? Thousands of years of automation. Every single time what happens out the other end is that you have you find new jobs because human wants are unlimited. Uh and those jobs pay much much better. So it's an escalator. So what happens is the automation is the escalator that every so often you have to take a step down. So you used to be an accountant, now you have to drive for Uber. But the thing is that the automation itself is raising the wages. So if you look at the industrial revolution, for example, a farm worker today, uh if they're American, they make about 25 bucks. If they're like illegal, they make more like 15. Okay? Compare that to what a farm worker made in 1800, right? In modern terms, I mean, it was like it was like $14 a day, right? So even even the jobs that step down, the automation picks it up. The problem is that the timing doesn't matter, >> right? So you know, you do have accountants who have to go drive for Uber. Uh I just saw a statistic that the average babysitter in the US makes over $20 an hour, right? Babysitting is just about the lowest skill job possible. You can be a 16-year-old in high school with no experience and you can babysit. Uh 20 bucks an hour, right? that that that's striking. So, you know, people are they're not going to starve to death. The automation is going to create more jobs because automation makes you richer. As you get richer, middle class people consume things that only rich people used to consume. So consider that today even like the poorest Americans, people on welfare, they get their nails done, they get their hairs done, they don't raise their own chickens, okay? They go to the store and they effectively hire butchers. They hire farmers to raise chickens. They hire uh butchers. They hire, you know, people to bring it many cases to bring it literally to their door. This is a level of services. This is the poorest people in America do this, >> right? They use like Uber Eats, >> you know? So, and and this is what happens in a rich society is that services spread. Uh, you know, also as the society gets richer, people have more stuff, you know. So the average house in America in 1950 was 950 square feet. Like if you think of how big that is apartment now, that's like a one-bedroom apartment. Uh the average house today is like 2500 feet. So stuff gets bigger. People have second homes. They have swimming pools. They need the pool guy. They need the electrician. They got more to go wrong. The fundamentally um demand increases for all of the other jobs that AI does not replace. And so what's fascinating to me is that it's almost an inverse of the industrial revolution. So the industrial revolution wiped out physical labor. And so but it made everybody much richer cuz you know a tractor is 50 times more efficient. So everybody got rich but the blue collars got knocked down. And when the smoke cleared blue collars today make much more you know seven 10 times more than they did but white collars make 50 times more. Right? So if you look at what's the equivalent of a professor before the industrial revolution, it was some crazy guy sitting in a park yelling about stuff. I mean literally, right? That's what the philosophers were in ancient Greece. They were all they were effectively homeless like Socrates. Um one of them lived in a barrel, right? So the these white collar jobs were not valuable before the industrial revolution. What happened is we got rich. A certain amount of that was siphoned off by special interests who then funneled it into universities or you know medical care of course advanced. So being a doctor is much more uh it requires a lot more brain work than it did in you know 1800 so on. So it it it sort of um it the escalator went up for everybody right even blue collars in America have air conditioning. However it reshuffled and what I think is going to happen with AI is going to reshuffle the other direction. So very specifically highly educated highincome older by the way white women. So Karen, if you look at the demographic profile, they are like ground zero. Uh what's also fascinating to me is if you think about the people who write AI doom porn, okay, so professors, people work at think tanks, uh journalists, okay, everybody who writes AI doom porn is 100% the people who are going to get replaced by AI. Plumbers, plumbers are not writing AI doom porn, right? So they are terrified of a world like already today the the plumber makes more than the journalist. He might make more than the professor. They're terrified of a world where the Door Dash girl makes more than that, >> right? I think that's what happens with AI. So again, the escalator goes up because AI makes everything so efficient. It cuts uh prices. Now, you know, people always say, "No, no, AI is BS. It's it's, you know, it's just pretending. It's it's uh mimicking what I read on Reddit. Okay, fine. If that's the case, then false alarm. Forget about it. AI is not going to do anything. But I think it is pretty significant because I use it every day. It is brilliant. Um it is as smart as the best economists. You know, people used to ask me these like really far out sci-fi questions like what happens if and you know, I'd be like, oh no, this is a good challenge. Let me and now like I ask AI and I'm like yeah, I didn't think about that. Okay, it's it it's freaking brilliant. I can say as a practitioner. Um, so I think that AI is absolutely going to change things. Specifically, it's going to do what the industrial revolution did, but this time it's going to dethrone the white collars who tend to be democrats. They tend to be influential. Uh, they tend to, you know, they're the ones who influence institutions and the government and the AI doom porn. So, I think that there will be an institutional backlash to it because, right, when the industrial revolution came, the guys who pitched hay, they couldn't stop it. the most they could do was like burn down factories every so often, right? The ludites in this AI. Okay, thi this is the ruling class. This is the elite who's getting dethroned. So, I think it's going to be absolutely fascinating. I'm there with popcorn. >> Yeah, I I probably tend to agree with that. And and the amazing thing is a lot of it's going to end up being open sourced and any it's like Bitcoin. It's like anything that they try to do to stop it, there's going to be a workaround. someone in another country that isn't, you know, doesn't fall under the king is going to figure something out and open source it. Um, so I I lied to you. I was going to ask I said that was the last topic. I do want to ask in everything we've discussed, right? We've got war, we've got AI, geopolitical turmoil, tariffs, all these things. What does all of this mean in aggregate? You have to go one by one for Bitcoin. And um is there a reason you think um like do you see do you look at Bitcoin adoption as you know you're you're uh bullish on where we're going over the next 12 months? Uh I don't really care about price too much but are you >> kind of think we're done with the stickiness of you know the 60 $70,000 range here soon or what's your what's your take? >> Yeah, I mean price I have no idea. Um >> that's the right answer. That's correct. >> Yeah, you know I think I think adoption continues. I think adoption got a little bit of a slowdown simply because the paperhand tourists uh are playing in silver. They're not anymore, but for a while there they were playing in silver and gold and and other things. So, you know, I think that's why um price uh took a hit recently. But having said in the long run, you know, the the long-term adoption I think is still solid. I think it's interesting that you know when we talk about the potential crisis uh the solution to all of those because of central banking is inflation. So like every crisis can in a sense be translated into inflation which means that every crisis acrus to bitcoin. So I think in the long run um I mean certainly as a hedge you know anybody who's invested in stocks or something I think absolutely has to have a chunk in bitcoin. Uh but I think as time goes on you know all all of those crises like each crisis gives a boost to Bitcoin price and also the Bitcoin adoption. Um and then sort of the meta question is can fiat go on forever? Uh you know is there some point where the inflation you know the crises get big enough that the inflation gets runaway? There's some point like 50% a year where inflation tends to accelerate very rapidly. just dump all their cash. Uh, and if we get to that point, which has happened many, many times in history, right? I mean, history is really just a cycle, right? Where you have inflation and then everybody wises up and goes to gold and then they get inflation again. They wise up and go to gold and you do it again and again. And of course, it's a cycle because every time they go to gold, you know, the fundamental problem with gold is that you can't like you can't in the modern day, you can't have a currency that is literally gold coins. it it's it's too expensive. Uh it's you know you have to have some currency whether it's electronic or paper that's backed by gold. Now the problem is that if you back it with gold you can't say that your gold is in a secret place and you can't tell anybody where it is >> right you have to give the address. You have to show the camera with the the sharks with the lasers on their heads and the uh so you have to show it and once you do that government is going to is is going to give you a visit and they're going to have opinions about what you should do with this goal. it's very risky to leave it here. Why don't you leave it with us over at the Fed? Uh, in which case it'll be rehypothecated, be relent, right? So, it'll be gone. Um, and so, you know, the I think it's ironic because for gold bugs, they say that the reason why Bitcoin is BS and gold rocks is because gold is physical, right? You can drop it on your foot. It's real. You can hold it. Okay. But that is also the reason why it is terminally vulnerable to government seizure. The government doesn't have to seize it. They just have to have opinions about what you should do with it next. Uh and so for that reason, we keep going through this cycle. What is exciting for me about Bitcoin is that once you get into Bitcoin, you don't have to get out, right? Because government cannot capture it. So then the question becomes, okay, well, you know, if fiat is going to die, which it on a long enough timeline it will, the question is, you know, when does that happen? uh if it happens like in the next 10 years which I think is extremely unlikely uh then we go to gold because there's some institutional memory because the older people who have more influence on the world are still gold bugs okay over the next 10 years uh if the end doesn't come for 30 years then I think at that point it's more likely that you go to Bitcoin because if you look at young people young people who understand central banking who care about the basement almost none of them are in gold Right. >> Yeah. Like that, you know, almost like I guess 45 or 50 is roughly the dividing point. I used to say 40, but that was five years ago. So, let's call it 45 is the dividing point. Anybody over 45 or 50, they just want to hear about gold. Anybody under that age, they just want to hear about Bitcoin. So, ironically, in a sense, Bitcoiners should be rooting for the fiat system to keep going a little bit longer so that the gold bugs flip over to Bitcoin. Now having said if it does happen in the next 10 years and we go to gold then at that point you know even the people who own gold I think are going to be much more receptive to switching over to bitcoin because bitcoin at this point has a lower inflation rate than gold right gold is mined I think around 1.2 2 or 1.5% a year. It's effectively it's inflation rate whereas Bitcoin is now below that. So even if we do go in the next 10 years, I think we revert to gold as we have hundreds of times through history. Uh and then at that point, you know, Bitcoin continues eroding the market share of gold. So I think either way, yeah, if we zoom out 30 50 years, I think there's a very good chance that we'll have a Bitcoin standard. Yeah, I I think uh in a worst case scenario, if we had to if we were to migrate to something like a gold standard or migrate to gold as like a more meaningful uh aspect of uh commerce, I think very quickly we realize, oh, may maybe this could have worked in the 1970s, but not in the digital not in the digital global economy that we have in, you know, 2020 or 2030 or 2035 or something. So, I think we I think we run out of we spin out of gold pretty pretty quickly would be my guess. >> You you necessarily have to decentralize gold because it's made of atoms. You have to store it somewhere. And once you store it somewhere, it's it's centralized. It's it's got all the vulnerabilities. >> Makes sense. All righty. My last question for you, Peter. Uh promise this time. Uh what is an unpopular opinion that you have and you get some bonus points if you offend Bitcoiners with it? >> Okay. So offens I don't know how offensive this is to Bitcoiners. Um so I think that as much as Bitcoiners hate the Fed, the Fed is the best salesman, the best promoter on earth for Bitcoin. Um, you know, if we had a system where either central banks were disciplined and careful and were actually protecting the dollar, which they did for a minute in like 1920, uh, if we either had that system or if we were already on a gold standard, then I think that it would be um it would be much harder to get people to appreciate and understand the power of Bitcoin. So, you know, in a sense, Bitcoin is created by central banking. It's sustained by central banking. I hate central banks. Um, so yeah, the the the Fed as Bitcoin's biggest champion. Uh, and the worse the Fed gets, you know, the more incompetent it gets, uh, the more that helps our case. >> So it's it was the curse that uh instigated uh the I guess the origin of Bitcoin and now it's the blessing that demonstrates why we need Bitcoin so very badly. >> Bitcoin would not exist if not for the creature of Jackal Island. >> Yeah, well said. All right, Peter, thank you so much for your time. Why don't you tell people where they can uh find you, read your Substack, listen to your podcast, anything else you want us to send them to? >> Yep. So, I make uh daily videos and little three and a half minute sticks on liberty and freedom or liberty and economics rather. Those go up on X, the artist formerly known as Twitter. Uh I also do deep dives every week on prophecy.com and I do a podcast where I round up all the videos at pets.com. >> I love it. Everyone needs to check these out. You you learn a lot very quickly. I think you're I've actually I'll tell you just a personal story. I've got a a sister who's a teacher and I've been I've sent her your videos like 20 times. I'm like you need to do this in your domain. Like this is like these three five minute videos. People love these things. It's uh something about him just like connects. >> What's funny about it is that you can you can get really deep on stuff because it's only like three and a half minutes. Mhm. Pick a single thing. >> Yeah. Like um like people don't get tired, >> right? >> Yeah. >> So like if I do something on like central banking and M2, you know, money supply and then how that relates to inflation. If you're doing that for 20 minutes, especially at like 8 in the morning, no. >> Yeah. >> No way. >> Yeah. It's got to be short. It's got to be as simple as possible. uh you know so you can explain difficult concepts to people um but I think there's a ton of fields where there's massive appetite for that you know whether it's psychology anything to do with science there's a lot of people who you know they just love learning different things like paleontology or chemistry or whatever I think there's huge appetite for it >> yeah we need a Peter St. 's doing three minute videos in every discipline and you know everyone would be a lot smarter. So Peter, thank you so much for your time. We'll uh catch up again soon. >> Awesome. Thanks for having me on. >> Cheers. And that's a wrap. Again, hope you enjoyed my conversation with Peter. I know I did. He's an awesome guy to talk to. Go check out his videos. His three to five minute daily videos he does are incredible. Incredibly informative and uh you learn a lot just just sitting down and listening to an expert for a few minutes every single day. Of course, if you need help taking your Bitcoin into proper 100% self-custody, go to the bitcoinway.com/mpodcast. You can schedule a free 30-minute consult with a member of our team. We will walk you through what it is we do, how we do it, why you need to be your own bank, and we can train you and get you across the finish line to do to do just that. And of course, if you need help with online privacy, setting up your privacy phone, we have a plan B residency option. So, all of your self-s sovereignty needs, we've got you covered. Again, go to the bitcoinway.commpodcast. You can schedule a time. Until next time, stay safe, stay sovereign, and remember, the yield on Bitcoin is freedom.