Kind: captions
Language: en
why are you a single issue voter when it
comes to our national debt um right now
the US is a car driving into a wall with
our foot all the way down on the gas we
are proposing uh the federal
Administration is proposing a$7 trillion
budget next year we have $33 trillion of
national debt um that number has swelled
since covid and in the Years following
due to the launch of new programs and
other stimulat effects spending by the
federal government and the
problem with having too high of a
national debt relative to national GDP
is the way that a government pays their
debt is by taxing their economy taxing
their GDP and there's a natural limit to
how much economically you can actually
tax the economy once you increase taxes
too high investment declines once you
tax Investments too too high on
individuals people leave we saw this
with the launch of the wealth tax in
France there's an attrition of capital a
hiding of capital all of these factors
aren't necessarily about people being
bad and doing bad things they're just
natural economic forces that we've seen
play out many times in the past so
there's a certain natural limit to how
much debt a government can actually take
on do we have a sense of what that limit
is well it some people would argue it's
somewhere between 100 and 150 to you
know maybe up to 200% of GDP but 100 and
150% is really where things are
sustainable now the US is a very unique
outlier in you know the history of
global economies but there has been and
you know I talked about this on our
podcast years ago um a set of studies
and Ray doio kind of captured a bunch of
data together in his book uh about the
changing um uh World Order and the
economic cycles that we've seen
historically six times in the last 500
years we've seen these sorts of things
have you had Ray on your show yeah a
couple times so you know the story so um
so I think the thing that that makes me
worried is at some point spending at the
federal level gets so high and debt
levels get so high that there's it's
really hard to come back from that money
printing that's needed to support paying
that interest and paying that debt and
right now inflation is being fueled by
the stimulatory effects of these
programs and because things are
inflating the government feels like
there is a need to help make things
easier for people so they put more money
and launch more programs to try and
reduce inflation and in doing so they
increase inflation and then as inflation
goes up the interest rates on the debt
have to go up when the interest rates on
the debt go up it becomes harder to pay
down the debt and so our $33 trillion of
debt a good 50% of it is getting
refinanced now where the interest rate
moves from an average of about 3% to 5%
and when that happens you know 2%
increase in interest on $15 trillion
that's another $300 billion of interest
payments a year and this this year we're
already paying a trillion dollars just
in interest on the debt that the federal
government owes to its um Bond holders
to the people that own treasuries so
we're getting to a point that it becomes
really difficult to actually stop the
spending pay the interest and or reduce
the debt levels and that's how these
spirals kind of have played out
historically and every time it's played
out whether it was the Dutch or the
English or you know whomever you want to
kind of look to there was always this it
can't happen here this is the the
leading global economy this is the
reserve currency of the world it's not
going to happen here and every time the
natural forces of arithmetic played out
and I'm that's why I'm so worried I
think that the US needs to
um the US voting population needs to be
really thoughtful about voting for one's
individual self-interest and voting
versus voting for the safety of the
Union of the United States
over the long R can we create a
circumstance in this country where
people recognize that we need to reduce
spending and that people are going to
lose benefits they're going to lose
things that they've otherwise had for
some period of time and that is a nearly
impossible thing to make happen in a
democracy where individuals get to vote
and that's where we see these sorts of
things start to reel so that's why I'm
so worried and that's why I am a
single-issue voter I want someone to
show leadership like Bill Clinton had
those poster boards back in the day
where he said here's how we balance the
budget here's how we cut things back
down to break even I think we need a
degree of Simplicity and Leadership
around that being the key point and the
key objective of the next Administration
and unfortunately I don't think we see
either you know candidates standing up
and saying we're going to do that um
yeah if we get either Trump or Biden uh
both of them increase the debt massively
so yeah we we certainly have four years
on both counts of what they'll do
economically I want to know that why
can't we stop spending the thing about
humans is I think we are fundamentally
driven by this concept that I think is
best uh phrased as
desire it doesn't go away humans never
stop
wanting the natural condition of a human
is to H see something that we don't have
and then create a objective of I want to
have that thing I don't have when I then
have that thing I no longer feel like
I'm unmotivated I now look for and I
naturally see the next thing I think
this is what made humans evolutionarily
successful we were able to then scout
out the next meal scout out the bigger
building scout out the better cave and
it allowed us as a species to
continuously progress expand our
population and succeed and thrive on
this planet but the unfortunate reality
is that that tuning that biological
tuning has this effect where no one is
ever actually satisfied fully satisfied
with the things they have satisfaction
comes from the change in the things that
you have the Delta and the Delta from
year toe is what drives happiness and in
a voting system in a political system it
drives how people vote that if my income
isn't going up by 10% per year I am
unsatisfied and there's a lot of good
behavioral social studies on this there
was a study done years ago which I think
has been disproven since but it does a
good job
I think of explaining this which is up
to a certain limit of of income people
are unhappy and they get happier with
more and more income after that limit of
income where all of your basic needs are
met with respect to being able to pay
for your food your housing medical and
take care of your your family your
income is no longer your predictor of
Happiness your change in income is your
predictor of Happiness so if we start
with that premise of like human
behavior the government now has an
incredible the federal government in the
United States has an incredible role in
um supporting a lot of people through
active programs that pump money into
businesses so the government is a
customer of many businesses or employing
many people that end up working directly
for the government or under government
programs and I think a study I I tried
to pull together all this data a couple
months ago but something north of like
30 or 40% of the US working force is
touched by the government as a customer
of their business the primary customer
of their business or as the employer of
those individuals so the government has
created um has been a big driving force
for economic growth in the United States
over the last 250 years but we're now
reaching um a point where in order to
sustain that system where people have
their income and their livelihoods
improved year after year because of
government intervention and government
policy it's no longer kind of
sustainable
um
so let's talk about some of the big
government programs a lot of people in
the United States are dependent on
Social Security and the income that
comes from Social Security that that
that program on its own is forecast to
go bankrupt in 2033 independent of a lot
of the issues we're dealing with in the
debt and spending in the rest of the
government the Medicare program um the
the costs continue to climb continue to
mount and a lot of people are dependent
on that program for their Healthcare
needs
so those are two very large programs um
Federal programs a very large percentage
of federal spending how do you get
voters where there are tens of millions
of people that are dependent on those
programs to vote to reduce those
benefits they simply won't and it's why
neither Democrats nor Republicans and
I'm not advocating for it at all I'm not
advocating for reducing those programs
I'm just pointing out the simple reality
of how a democracy will work in this
circumstance which is those individuals
don't want to give up those benefits
they don't want to give up that income
they don't want to give up that medical
care it was promised to them they
invested in those programs for decades
but the government and the way that the
system has been set up has now made it
um you know very difficult because we
have to take on more debt to support
those programs and then we have a lot of
other stimulatory programs a lot of
other uh systems where the government is
the customer of businesses they are
spending money to buy stuff from those
businesses Medicare is a good example
they buy a lot of pharmaceutical drugs
and
um the system is challenged
because if I'm the government what's my
incentive to negotiate for a lower price
I can go to Congress and get a bigger
budget Next Year everyone in the system
is built to make more money for
themselves so next year I want to have a
bigger budget I want to be able to spend
more I want to grow my Organization no
one ever leads an organization and says
I want to shrink this organization I
want to cut it by 50% that's my goal
let's shrink the organization that I'm
leading the natural incentive is to grow
so I think that there's a lot of like
tension in the way that the system has
evolved that both the internal
organizations are designed to grow and
the voters are not going to give stuff
up that they've gotten and I always
think about like in my junior high there
was a kid who ran for like president and
he said I'm going to make all the
vending machines free that was his
platform it was so smart and everyone
voted for him like of course I'm going
to vote for the guy that tells me I'm
going to get the vending machines are
going to be free I don't have to pay for
my chips and soda
anymore that's how people get elected in
in a democracy they they go to the
voters and they say here's what I'm
going to give you they don't say here's
what I'm going to cut back for the
survival of the Union over the next that
doesn't sell what sells is I'm going to
increase Medicare benefits I'm going to
improve Social Security I'm going to
launch new programs to support uh you
know your community I'm going to build
stuff I'm going to create new jobs those
are the things that that voters want to
hear and so there's this demand from the
voters for more stuff so I would argue
that the politicians aren't necessarily
even the cause of the problem I think
that they're more a symptom
of the system that is set up to operate
this way um not not necessarily set up
to operate this way but naturally
evolves to this point that the voters
every year want more stuff and if
they're not getting more stuff because
the economy isn't naturally growing and
their incomes aren't growing they turn
and look to the government to solve
those problems and then the government
has to grow and uh then they put people
in place who stand up and say I'll give
you all that stuff and they're like okay
great you're you're you're the guy
you're the you're the gal you go do that
we vote for you and I think that's why
it's so hard to back away from this all
right explain to people how money
printing fits into this and why so money
printing was something that I had to
discover uh quite late in life and
realize there's some pretty um the the
fundamental nature of how it works was
not at all what I thought so what is
money printing how does it play in I
want to make sure my numbers are right
and I could be wrong on this um we can
double check normally I'm on a computer
when I do this sort of thing so I can
just tell Drew what you want to look up
but I um if you look at the uh um the
balance sheet of the fed and the uh the
balance sheet of the balance of the
treasuries that they hold I think it's
about 8 trillion
now so um the Central Bank of the United
States is the Federal Reserve 7.4
trillion so about 8 trillion the federal
government needs money to pay its bills
all the stuff that it's spending money
on and the way that the federal
government does that is they tax
businesses and citizens and that tax um
allows them to pay their bills but we
spend more than we make so the federal
government has to issue bonds these are
promises to pay in the future and those
bonds are bought by people like you and
I it's bought by federal by um foreign
governments China Saudis a lot of um uh
individuals and companies around the
world like to hold us treasury bonds
right now treasury bonds are a great
yield you can get 5% interest by buying
us treasuries and the federal government
guarantees are going to give it to you
that's the word of the US Federal
um the US Treasury which is a very
historically been considered a risk-free
asset and uh and then they take those
treasuries and um they get a cash and
then they take that cash and they pay
their bills one of the buyers of
treasuries is the Central Bank of the
United States the Federal Reserve which
is overseen by Congress but it's
separate doesn't actually report up to
the the president so the Federal Reserve
has this ability to buy treasuries and
issue money issue cash that they don't
have right so the Federal Reserve has
this ability to print the US dollar and
um and so historically they've been
buyers of treasuries supporting the
market for the federal government to be
able to issue debt to pay their bills
and then as more money comes into the
system from the Federal Reserve which is
effectively created out of nothing that
money flows its way into the economy and
if you have for example you know 30
trillion floating around versus 10
trillion US dollar floating around
things are going to inflate because
there's more dollars to spend on stuff
and the cost of things will naturally go
up that's a super super duper simplified
way of kind of explaining the system so
the Federal Reserve the Central Bank of
the United States um issues money almost
on a loan basis to Banks and buys
treasuries with the expectation that at
some point the US government is going to
pay them back so that's the economic
relationship between the central bank
and the federal government and the way
that money then finds it way into the
system the federal government can't just
print the money the central bank can and
then those those uh those treasuries get
get held by the uh by by our Central
Bank and that money finds it to into the
system so at some point whether um you
can you can look at the total amount of
debt of the federal government and think
like any household how much debt can you
afford each month and at what point are
you going to go broke that's one way to
look at it and another way to look at it
is that in order to overcome that
there's going to be a lot of money
printing because the Federal Reserve can
just buy all the those bonds and issue
that money and then that money just
finds its way into the system so there's
a question at which point there's too
many dollars that get printed this is
the part that people don't understand so
there's a magic thing that happens when
the the money is made up you said I
think essentially made up out of thin
erir I'll say it's made up out of thin
err like completely fake untethered to
anything it is literally just a entry
into database that they decide to click
clack and now that money technically
exists um why isn't that awesome why
isn't it awesome that we can just make
more money just keep making more money
make the budget bigger every year let's
say let's say that you and I have $50
each and we're the only people with
money and there's a guy over
here selling sodas we know we can buy
those sodas now and he's only got four
sodas to sell and we really want to buy
all the sodas so we eventually end up
paying 25 bucks each for a soda okay
there's four sodas 50 bucks each
suddenly some guy shows up with another
100 bucks or let's say the other guy
shows up with 200 bucks now he's going
to start competing for those sodas and
the guy that's selling those four sodas
is like hey guys it's no longer you know
50 bucks of what did I say 50 bucks 25
bucks of soda suddenly the price is 75
bucks of soda because there's more
people that want sodas and there's more
cash available so that's how the price
of sodas is inflated that's what happens
when there's more money that floods into
the system is that the purchasing power
of the existing dollars in the system
goes down because there's now more money
competing for some number of assets or
services that are being sold so the
price of assets and the price of
services goes up and the value of the
dollars goes up goes down which means
that the the value of your savings the
value of the stuff you own goes down and
this is particularly true for the
majority of Americans who are not big
asset holders right they only have uh
you know more than half of Americans um
you know can't pull together $1,000 for
mercy so if the value of dollars go down
and their incomes aren't going up
they're deeply hurt by that people that
own a lot of stuff can take their assets
and they can buy inflation hedged
Securities or inflation hedged assets
like you could go buy Timberland you
could buy gold or you could buy Bitcoin
which a lot of people argue is a great
inflation hedge now and those assets
because they're fixed in Supply they
will go up in dollar denominated terms
and so wealthy people can handle
inflation
the majority of other people cannot and
inflation really hurts the economic
growth because now people spend less
they have less money to spend and
businesses shrink and things go bankrupt
so inflationary Cycles are very damaging
to um to economic Cycles okay so we have
a thing that happens where we're in an
inflationary cycle it's brutalizing
people but I would say the average
person doesn't understand it so they
don't know that it's happening I'll make
a state you tell me if you think this is
fair um money printing is legalized
theft from the government they they are
stealing not your dollars because you're
going to have the same amount of dollars
in the bank but they are knowingly
stealing your purchasing power which is
the same in effect as just taking money
from you yes and what I will change
about your statement is I will expand
the definition of government to the
people that were voted into government
by the people that voted okay and this
is what's so important to understand is
we all kind of separate out these
elitists and these politicians that are
doing bad stuff to us but the voters in
the United States have the ability to
change that they have the ability to see
this problem and make a decision about
who might be a better candidate to solve
this problem for us instead of being
myopic to getting more stuff for
themselves individually in the near term
which is an impossible ask but one
that's worth noting there's a reason
that the system there's a reason that
the voters have made that choice it's
not just that there is a bad person who
is choosing to print a lot of money and
steal our our money um I I am
very very much
about rethinking the concept of the role
of government in our lives and in our
economy that's Prime to me because I do
think that anytime the government gets
involved in uh
markets it distorts the market forces
that allow things to get better and get
make things cheaper for people and make
markets grow everything goes wrong when
governments get involved in markets
there's no scenario I can think of where
things are good but individuals will
still rationalize it the guy who owns
the defense contractor is very happy
with the government you know being
involved in markets because he gets to
make a bunch of money selling the
government turbines for his from his
from his business and because the
government is a Cost Plus model on
defense Contracting the more he charges
the more money he makes so he's
incentivized to charge more every year
so that model to change right as an
example of the things that can be
affected by the voters um so I just want
I agree with your point I just think
that the voters have a role in this in a
democracy in addressing the problem okay
and sorry I'll say one more thing which
is worth noting go back to the example
of the soda guy the guy only has four
sodas but what if he comes up with some
new fangle technology a replicator
machine like from starre and now he can
make eight sodas or 12 sodas or 20 sodas
his invention of that technology makes
the cost of soda less even as there's
more money coming in there's now more
sodas so we don't need to all compete
for fewer sodas so the productivity the
production of more stuff is good for the
economy and it gets us out of this
problem so when you hear people talk
about economic growth or GDP growth
there are two things that drive GDP
growth one is the inflation of stuff
things going up because there's more
money coming in but the other one is
improved productivity technology making
more stuff with less resources
and that has historically made the
United States so successful and for the
last 250 years has fueled our economy
fueled the United States success
globally um our Innovation our
entrepreneurship technology solves this
problem if we can get it to move quickly
fast enough there's another Point
besides just voting right and fixing
this through the voting system which is
enabling more technological innovation
and
enabling productivity gains to arise
from technology
in that sense we Face another critical
problem right now which is a very
serious negative view on technology and
I do think that the majority of
people don't necessarily think about if
you say the word
technology um there's a more negative
association with that word than
positive go back to the
1950s there were all of these crazy like
posters of about humans will go on
Rockets to the moon and we're all going
to live on Star bases on the moon we're
all going to be on monals and move
around the country and mon rails is
going to be flying cars um these new uh
materials that we were inventing we're
going to change everything we'll be able
to put on suits and go underwater and go
to our underwater cities there was this
incredible wave of innovation that
happened particularly out of the
chemical engineering Revolution that
happened in the early 20th century and
the early Industrial Revolution and then
post World War II where we were so
optimistic about technology
then what happened is that we started to
get cancer and there were meltdowns of
nuclear facilities and people got and
there was a cold war so there were these
big nuclear bombs sitting over our heads
all the time and we were doing Duck and
Cover from nuclear bomb attack training
at school and I think that the American
psyche and the psyche of the West
largely which benefited very much from
this progress that arose from
technology got really challenged in
terms of ad op in and appreciating the
upside of Technology because there was
so much downside and then we got scared
of technology and then everything became
kind of this critical anti-technology
Association in 1955 Disneyland open I've
told this story before with this ride
called
Tomorrowland and or this area called
Tomorrowland I mean you've been there
and every ride there was about the
future opportunity with technology you'd
go on a rocket ship to the moon and back
that was one of the rides um you would
go inside the the world of chemicals and
you would learn about making Plastics
and making new materials and it was like
this is going to it was like the home of
the future and they showed this really
cool home where everything was like made
of these new materials and it was crazy
because prior to that we were like hand
making wood
everything in the
1970s they started to turn over all the
rides in tomorrowand at Disneyland and
every ride got remade as a fear of
Technology ride so um uh the uh the
rocket ship to the Moon became Space
Mountain and it's all about a rocket
ship that went off course and it went
flying through the and so you're on this
crazy scary ride Star Tours was a robot
that broke down and took you the
Navigator robot broke down and you went
on a wrong course and you crash and die
Captain eio I don't know if you remember
this Captain eio Michael Jackson comes
from outer space with his clan of people
and they destroy the robotic world that
had been overtaken by robots and they
return it to an organic natural state so
everything about what appealed to people
starting in the 70s as represented out
of Disneyland and Tomorrowland was all
about technology goes AR and we have to
return everything to a natural organic
state so there's this great tension and
we see it play out all the time in
bioengineering in gene eting in AI in
all of these Advanced Technologies that
the United States is leading in and
progressing in but there is so much
trepidation and concern and fear that we
are potentially missing out on the
productivity gains and the um the Boon
that would arise from these Technologies
being more rapidly adopted and solving
this big kind of economic crunch that
we're running into so I just wanted to
highlight that important point because I
think it's really critical for folks to
to pay attention to and I'm not saying
that the concerns and the risks of
nuclear meltdowns and cancer and
chemicals all this stuff is unfounded
but what we have a tendency to do is to
take one event or one experience and
blanket the entire space or the entire
industry around that one experience and
say we need to stop all of this because
we have no margin for
loss there was a guy who died in
1997 99 I'm going to get this wrong um a
patient who was uh getting a gene
therapy treatment it was a young
guy and when he died they put a stop on
gene therapy treatments for I think
seven years they weren't allowed to do
any more gene therapy treatments and
since then we now have literally dozens
of gene therapy treatments that can cure
um dozens of human diseases saving
millions of lives but for seven years we
weren't allowed to make those things
progress because we were worried about
losing another life
and so there's a a challenging thing in
a in a wealthy Nation like
ours and I've gone on for a while but um
we worry more about loss than we care
about gain if you go to a small poor
African nation they are not worried
about the downside of putting in a
nuclear power plant that would drop the
cost of electricity and give everyone
abundant power in their homes and clean
water they would say we'll take that now
done lock it in but the United States we
don't want to have a nuclear reactor
because now the marginal cost of
electricity gets reduced by 3 cents a
kilowatt hour so it goes from 15 cents
to 12 cents uh I'd rather not have a
nuclear facility in my backyard we have
the privilege of that in this wealthy
Nation so that's the other tension that
holds us back from embracing new
technologies is our risk aversion we are
more worried about loss than we care
about gain in this this state of where
we are inflation is eating the value of
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right you're putting a lot of
psychological principles on the table
which are great I want to give people
some mile markers sorry I've gone over a
lot of stuff no this is fantastic so
this a lot of the stuff that I wanted to
lay out but I think we need to drill in
in a few places so one going back to
money printing because this is the one
that I think um everything revolves
around this and we haven't even talked
yet about how War plays into this yeah
but so money printing I think a big part
of the problem is that people do not
understand it so you can say it but they
don't understand it and it's a very
counterintuitive thing to say dear
constituent I'm going to to print some
money and I'm going to give that money
to you and it's very difficult for
people to understand that's bad for you
and it may help in like a really acute
moment like when covid happens and you
need to put stimulus into people's hands
just to calm some of the panic and make
sure everybody makes it through okay but
even that is a trade-off and you're
going to have a problem and I'll say
what the problem is very succinctly the
way that money gets put into the system
in that magical moment where the FED
creates money out of thin air is that
they're buying the bonds with it so now
if I hold that asset
class I'm going to get that money and so
that money basically just protected me
so their mechanism for getting the new
money into the marketplace was to buy
the asset that I had to give me my
guaranteed return on that money yes now
that I'm already going to have to be
educated to be doing that so most people
aren't doing that so you this starts to
create this divide between the Hales and
the Have Nots
so then people what they don't
understand in that moment is that when
they print the money they are
socializing that decline in buying power
across everybody that's right poor
wealthy everybody but the wealthy just
got a bump because they got their the
money that they put into the bond of the
treasury protected plus they got a
return on that money and they only lose
as much as the person who gained nothing
from the money printing but now only
loses and so as they just print print
print print print
if you're like oh I'm getting my Social
Security protected oh I'm getting this
funded or whatever they think oh this is
amazing but they don't realize that that
those losses are being socialized across
everybody and then the other one and
this is something that I've heard you
say really succinctly is that it also
creates an appetite for war explain why
that's true why does money printing lead
to more Wars yeah it's not simple but
we've seen it historically over and over
and and over again which is as great
nations rise their populations demand
more the government takes on debt prints
more money gives the population more and
at some point you reach this critical
natural state where the
economic condition isn't naturally
growing it's not it's not catching up to
the cost of the debt to support the
programs and the the things that the
population demanded that people demand
it so at any given moment there is the
potential for war okay at any given
moment there is someone out there
talking smack about the United States
there is someone out somewhere out there
instigating launching stuff at a base
there's always some
instigation the choice of do we make a
decision now to let Saddam Hussein
continue to be the leader of Iraq or do
we make the choice to go in and spend a
trillion dollars to remove him from his
position and go get access to those oil
fields and then put us companies in
charge of those oil fields and then tax
those companies to generate Revenue
becomes a more interesting choice a more
obvious choice and I'm not saying that
there's a conspiracy theory in why we
went to I think the America wanted to do
something bad coming out of 911 we
wanted to do
something not bad we wanted to do
something aggressive to respond to 911
well we've got temporary examples with
Russia Ukraine Israel Palestine like
there's no unfortunately no shortage of
things where this is so what are we
going to do with Y hoodies launching
stuff at cargo ships going through the
the Suez do we choose to have a
proportional response meaning send in
some SEAL Teams and take care of that or
do we move all of our military to that
region and start to instigate and
support the Israeli conflict in Gaza and
then start to fuel Iran's interest in
getting involved and eventually Force an
alliance between Russia and Iran and
China which creates a really nasty
circumstance but allows us to then move
our military machinery and our economic
forces into that circumstance because
War historically has driven a lot of
shifts in economic productivity it has
driven a lot of um growth in aspects of
the economy that need to be stimulated
and so it's not like there's a bunch of
guys sitting around in a room Illuminati
guys saying let's go to war and grow the
economy but when things are great when
the government is running a surplus when
people are happy when voters are happy
when the nation is not
divided um the economy is growing and
everyone is employed and everyone feels
good and Israel gets into it and Gaza
gets into it and they the Palestinians
and the Israelis get into it the US in
that circumstance is probably more
inclined to say you know what let's not
escalate this thing right now things are
pretty good at home let let's just can
you guys just resolve your differences
same with Russia Ukraine can you guys
please just not like escalate we're not
going to give you a lot of weapons
Ukraine go go negotiate a settlement go
figure out how to resolve this thing we
rationalize it now as in pursuit of
Liberty in pursuit of democracy there's
always a way for either side to
rationalize the decision but I'm just
saying generally speaking if people are
happy at home they're not looking for
conflict AB abroad we are not happy at
home and the economic circumstances are
deeply coupled with our unhappiness at
home and so we are more willing to
engage in Conflict abroad let's give
another 80 billion to Ukraine let's get
that thing going let's do something as a
nation I think there's a lot of aspects
to why this happens one is it brings
people together we now have a common
enemy there's an external Force this bad
guy in Russia Putin we got to go get him
let's all get behind this idea of
destroying Putin it's great great okay
good he's the bad guy Saddam Hussein
He's the bad guy you know uh is it Hamas
or Israel really not sure right now so
like there's a b there's got to be a bad
guy over there there is a bad guy some
there's a bad guy let's go get him um
and then we get to spend a bunch of
money it's stimulatory I mean you heard
uh um what's his name uh uh our uh
Senate U Majority
Leader um our Senate leader um anyway he
said all the money's coming back home
we're spending all this money on Ukraine
but we're actually buying we're giving
them money to buy weapons from us
manufacturers so that money is coming
back home it's stimulatory right it
creates economic growth it creates
revenue and now the debt is owed back by
Ukraine so we're just just taking
another balance sheet item right we're
taking a balance sheet item from the
ukrainians they now own some treasuries
or sorry they they're now owing money
back to the to the government we've
given them that resource so um so I
think there's a bunch of reasons I think
that there's the psychological
uncertainty that drives this things are
not good at home well I can feel in
control if I go beat someone up right
it's like a bully I can I can go feel
better about resolving um my issues at
home if I can go fix a country elsewhere
and get new businesses installed there
and make money there that could be good
that let's that that sounds like a
better thing to do because these
problems at home are pretty
insurmountable they're pretty hard to
deal with so I think that's why we've
seen this I don't know if anyone's
written a good set of papers on this to
to go through each of the historical
periods where we've seen external
conflict arise out of increased money
Printing and debt but it always happens
it always happens and um and I just got
really nervous you know coming out of
2020 2 or
21 21 and I was like man I think we're
going to end up in a war with Russia
like it just felt like the circumstances
were right given the deficit we were
running that year and how debt was
running up that Year little did I know
that we keep doing it for two more years
like we've been doing and it's only
getting worth $7 trillion do budget
proposal next year so I just felt like
coming out of 21 we were going to end up
in this conflict with Putin because he
was sort of making comments about hey
you know I need a commitment of not
joining NATO and I need more of this and
there was all this stuff that been going
on for a decade but suddenly you know it
seemed to be the right mix of stuff for
us to say let's get involved you know
like let's do something no one no one
will admit that and I don't think
anyone's ever going to be like very no
one will overtly design a system to do
this and I don't think that even I've
talked to leaders
in military in intelligence and no one
has this point of view that this is a
motivating factor but when things were
great everyone had this ability to say
let's not go to let's do everything we
can to avoid conflict this feels very
much like Ray Delio's thesis that uh
every time that you have a new world
power rising and you have an economic
superpower that's declining you're going
to end up in conflict and I think that
and it's not 100% of the time but it's
something like 85% of the time
historically and Ry I've talked about
this on the show many times but uh Ry
did a survey looked at the last 2,000
years but really focused on the last 500
and the rise and fall of all these
nations he said it's always tied to the
debt cycle and what ends up happening is
exactly what you've been describing
people just always want more they're
driven by desire it feels it's real fun
in the beginning and for a long time it
works and this is the problem it'll work
for between 150 and 200 250 years if you
play your cards right you can do this
and so I think the reason that we end up
in these hot Wars is the turbulence of a
rising superpower China a declining
superpower the US you're already going
to get frictions they're jockeying and
to your point war is great for business
and then there's another element to all
of this which is that and this is the
part that I am as a a born again or not
born again because I was never born but
as a late convert to understanding money
the thing that I really want people to
pay attention to is when the government
prints money they get to take your money
without asking Congress for permission
that's right so they can have as much
money as they want it steals your buying
power it is literally the same as taxing
you extra money uh but they don't have
to ask and so they just go oh cool I can
rev up my economy by going and fighting
in the Ukraine I can rev up my economy
by going into Israel Palestine awesome I
need to do that because we're in this
debt spiral where I'm I'm I want my7
trillion budget next year but to get
that I know I'm going to be running a
hotter deficit and so the only way I'm
going to be able to pay that debt off
especially as it gets refinanced that a
higher rate is I'm going to have to
print money again make it up out of thin
air which exacerbates the problem but it
also kicks the can down the road just
enough I can get elected I can have my
career I can buy time as the Empire
basically slowly declines and when
people aren't able to track like all of
the things that makes the system work I
forget who said it but you don't need a
conspiracy when all the incentives align
that's right and so it's just it it is a
perfectly aligned incentive structure
including and you've gone to um very
effective uh links to make this clear
the voters are voting for it and so
ultimately we're all a reflection of the
same sort of human desire for more more
more so if people are going to vote not
only in their sort of immediate
short-term interest but the long-term
interest they actually have to
understand how all of this stuff works
and so to your point about making
something really simple that people can
track that's what uh this feels like all
right I have an an idea that I I don't
hear many people talk about nakedly and
I'd love to get your take on it I
believe that one of the things that
ought to be added to the Bill of Rights
and I use ought to imply a moral
obligation but one of the things I think
ought to be added to the Bill of Rights
is to have access to a
non-inflationary store of wealth could
be a currency I I haven't looked far
enough to understand if this if gold or
gold still inflates Bitcoin something
like that uh or something else whatever
I don't care what it is as long as it's
a
non-inflationary place for me to store
my wealth uh I think we ought to be able
to have access that well the term
inflation reflects the inflation in some
denomination so if you had bought gold
10 years ago in US dollar denominated
terms gold has been a way for you to
hedge against the inflation of the
dollar gold prices have gone up so your
purchasing power has gone up more than
the rate of inflation but if you had
bought gold in Bitcoin denominated terms
and you Ed Bitcoin to buy your gold
you've actually not done a good job job
storing your wealth because if you had
Bitcoin before in a Bitcoin denominated
model bitcoin price relative to Gold has
gone up much faster so remember like
stores of wealth don't really mean
anything because it's all stores of
wealth they're just a paired value it's
an asset relative to another asset what
what am i counting it as so you could
own dollars and you have a non-inflation
you know you have you have something
that never you you'll always have $100
it'll never change in terms of value if
you buy gold and
you have inflation the price of gold
should go up in dollar denominated terms
so that Hedges you against the loss and
purchasing power of your of your dollars
I think from an amendment from a Bill of
Rights perspective what we could do
really well to think about is a balanced
budget amendment which means that the
federal government has to balance the
budget every year they don't have the
ability to acred debt and you could have
a balanced budget
amendment that accounts for cycles of
War and the necessary investment in
economic growth grow by creating some
features in the amendment that allow for
emergency authorization provided you
know debt to GDP levels or within a
certain range Congress has authorized an
actual War I mean there's a lot of ways
to kind of protect against the things
that everyone immediately counters with
and they're like no no no you can't take
that power away from Congress you got to
let them stimulate and I think what
we've seen historically is congress's
the federal government's attempt to
stimulate um has negative long-term
implications for uh in a lot of ways
because we don't ever reverse the
programs we don't ever get back out of
them
so I'd like to see from a Bill of Rights
perspective I'd rather see a balanced
budget amendment which I think protects
my dollars better than forcing me to put
you know creating having the government
involved in some new asset but we we
have a free market so we do have the
ability to go out and buy whatever we
want and store our well we until
recent uh mumblings have started coming
out of the SEC certainly Biden has been
very anti- crypto gendler's been anti-
crypto and so this is what got me
thinking about in terms of hold on I
should have a right to this
because you can without any checks and
balances print my netw worth away which
which when you when you answer and ask
when you ask and answer the question
what is money and you realize oh this is
a way for me to store the economic
output of my energy so this is a way for
me to say I did a thing on Tuesday and
I'm going to be able to in some way
capture the output of that effort that I
can store for effectively ever now if
you create a system like they have done
with Fiat you mean without without being
inflated without correct correct correct
so if if I have a $100 worth of buying
power in a hundred years I should have
$100 worth of buying power in in the
same day not yeah where that changes
dramatically and you know now I need
$1,000 so if you give me that now I
don't have the weird perverse incentive
to spend money today I have an incentive
to think longterm now all of a sudden
balancing a budget doesn't freak me out
because I'm like I I don't need you dear
government to be in control of all of
the systems because I can actually save
my money yeah and because my money
doesn't go down in value over time I can
just stack chips and so I can live
however I want but it has turned us and
it's always interesting having these
conversations with a poker player so
when I got first got into studying
crypto I realized it really attracts
poker players which is a gambling
mentality which so clocking Bitcoin now
because I think when I brought that up
and I said Bitcoin is a possibility and
you said well if somebody bought gold
using Bitcoin that would have been a
mistake yes but for a totally different
reason which is right now Bitcoin is
going through a period of adoption which
means it has massive volatility gamblers
like the volatility that's where they're
going to make their money but what I'm
saying is I just want an asset that is
and we can look at gold uh I want an
asset that can't be inflated now I heard
I think this was on Rogan people were
arguing why why gold why is gold the
store of value it is my understanding
the reason that gold is a store of value
is because a star has to explode and
rain gold on the earth for there to be
new gold and the only reason that it
inflates by roughly 2% a year is that's
what we can extract and as you sort of
balance out the supply and demand even
though you could probably get a little
bit more the incentive begins to break
down so anyway we end up extracting
roughly 2% more gold per year so it does
inflate by 2% but because it is super
hard to inflate hard to fake uh you
can't turn dirt into gold like diamonds
you can fake and all that stuff so
anyway gold has these properties of not
being flatable and it doesn't mold or
rot so it will carry over time so that's
the kind of thing that I'm looking for
now some people will believe in the
Bitcoin version of that but that's
irrelevant to me I just want something
that cannot fall to the whims of the
human desire to inflate it away which we
have shown over and over and over if
given a chance people will do yeah I
would say look I mean I I think that
your principle is sound I think that
some people would argue that there are
options like that but everything carries
some degree of risk you're taking on
Association socially like if everyone
gives up on gold it's gone if everyone
gives up on bitcoin it's gone the value
goes down right so there there is like a
system of trust like a um an aggregate
kind of social system that has to
continue to appreciate whatever it is
that you're holding on to but that's
already true of fiat currency so fiat
currency has the additional downside
yeah until people start saying no like I
I don't believe in it anymore that's
what I'm saying so the same
vulnerability that something like
Bitcoin or gold has you have in fiat
currency but at least with Bitcoin or
gold the governments however much they
may want to manipulate the supply all
they could do is buy it off the market
in which case there was an exchange of
value at that point uh but they can't
make more magic then you're having faith
in your government's ability to
continuously do that for the next
hundred years for you to do what protect
your asset whatever your new asset is
saying to protect my Bitcoin yeah or
whatever your new asset that you're
creating on your you know whatever the
new inflation protected asset is that
you want them to give you a right to
right the government at any point could
change the laws the government could
lose its power the government could lose
its Authority there's some risk
associated with anything for sure but
does that risk go up or down that's my
point right now I feel like we're in the
worst of all worlds where you're in a
situation where you have a fiat currency
that has no intrinsic value which I
don't mind people saying that uh Bitcoin
has no intrinsic value cool it's all
narrative I'm here for that y but you've
got this thing that has no intrinsic
value that is 100% in the control of the
government uh as somebody who just has a
weird pathological uh aversion to
authoritarian rule uh when I watched
what happened in Canada where the
Canadian government was like oh truckers
are protesting I say say less fam I got
you we're going to look at your faces
clock your bank accounts shut them down
totally insane I literally I cannot
believe that that happened in the last
couple years Australia during Co the UK
I mean it's all over the West so crazy
even yeah the East too I'm sorry it's
everywhere everywhere yeah so that's the
one that terrifies me and so getting
something what what I really want is is
the U people of the United States to
admit that this is important enough that
we should see it as an inalienable right
we don't currently uh
so but the the knock on effect and um by
all means if you think I'm out of my
mind keep pushing but the knock on
effect of this is where I think this
gets really interesting and what does a
world look like where my money isn't
inflating I don't have the perverse
incentive to spend today and never save
because right now people that save are
punished um so but you're you're
basically proposing an inflation
protected asset right which
definitionally means you can buy the
same thing in the future as you can buy
today for some number of units yep so
Big Macs can go up in price and you can
still buy
one unit to buy one Big Mac and in 20
years you can buy one Big Mac with one
unit but what if the price of Big Macs
has gone up way more than the price of
gasoline or the price of gasoline has
gone way up so you're always indexing
assets to other assets they're always
paired value and so we use this term
inflation I think a little Loosely in
the sense that like we assume that yes
there is generally devaluation happening
with the dollars but in some cases you
can buy a lot more Brazilian Ray eyes
with dollars today than you can three
years ago or a couple more um you know
it's gone up by 20% um then you could
have even though our ability to buy food
has gone down and so if I go to Brazil
with my Ray eyes I can buy more stuff
right I can I can go to the UK now and
buy more stuff because the value of the
dollar relative to the pound has
actually improved so inflation and
dollar denominated terms against food
prices and energy prices and housing
prices and car insurance and all the
other things that we as consumers in
United States care about has gone the
wrong direction but when paired against
other things around the world you know
against the Yen against the pound
against the ri the Dollar's actually
done well which means that your
purchasing power has gone up in those
countries because you own dollars we
don't see that every day as consumers
and global trade helps solve that by the
way and I'm a we can talk about
globalization at some point but like I
think that it's important to understand
what are you pairing against what are
you looking for protection from is it
the price of food or the price of energy
or the price of housing or the price of
medical insurance or you know government
manipulation of the monetary Supply
period so then you shouldn't own
currency right you shouldn't own dollars
and um I think that these globally
traded assets these Commodities like
copper gold these are the sorts of
Bitcoin potentially are the sorts of
things uh the challenge with Bitcoin
obviously is that there's it's a got a
very anti-government orientation to it
which makes it the enemy of government
and so powerful government Trump has
come out in aggressive support uh RFK Jr
aggressive support now RFK Jr maybe has
a slightly anti-authoritarian
anti-government bent as it is yes so
take that for what it's worth but he's a
legitimate candidate for president so I
can feel something shifting I think to
your point that what happens in the
government is merely a reflection of
what's going on in culture and so you're
seeing what I call the age of conspiracy
So Co broke people people's uh ability
to trust the government and I think that
that's just continue to snowball it's I
think people may be letting that
snowball too far and now they're throw
it all away burn it all down we'll start
a new that worries me far more yeah um
but I think that they really are looking
at the truth which is that you being
lied to you're being manipulated even if
the people lying and manipulating are
doing it with the best of intentions
they're lying they're manipulating so
what I'm trying to get is uh a currency
that they can't manipulate even if they
think they're manipulating it for my own
good so that again I don't have the per
perverse incentive to spend I can save
it I can know what it's going to be now
I hear you in terms of the volatility
it's just an asset a currency is just an
asset and it's an asset relative that's
valued against some other asset 100% so
let's take that head on so uh you're
never going to be able to you can't and
wouldn't want to try to squash the
volatility and all of these things so I
would not want any protections on
whatever asset class comes to I'll call
it Bitcoin for now uh just because for
me that is the asset class I'm treating
like this it has high volatility we've
already talked about that uh in the
future I think it will be low volatility
and it will really be about its ability
to um not inflate yeah so okay cool I've
got this non-inflated asset even though
I'm still in a world where stuff is all
over the map things are going up and
down one day uh oil is going to be this
much this many barrels per Bitcoin and
that's going to change uh and if you're
pricing your life and energy which is
probably a very wise way to think about
it then that's going to matter I'm not
saying that it won't matter what I'm
saying is at least then only half of the
equation has that level of volatility
and now I have a store of wealth that I
can plug into uh and maybe to really be
effective at what I want it to be it is
a non-inflatable currency I haven't
thought about it enough to know whether
I think that's better or worse but maybe
maybe that's exactly what you need so
anyway uh I don't I'm not worried about
all the other volatility but I do think
that a natural knock on effect of having
this store of wealth where I know $100
the the buying power will be contiguous
down the line that that will create a
world where I can as the consumer I can
benefit from deflationary things that
happen in technology so you planted a
flag at the beginning of this
conversation which I think is brilliant
and I think most people do not
understand that the only way out of this
spiral is innovation Now history tells
us that ultimately even that breaks down
and you you end up missing you end up
not being able to innovate fast enough
to keep up which is why no empire ever
in human history has lasted people need
to only think about that not once not
ever in the whatever 25,000 years 12,000
years wherever you want to clock the
starting of uh human empires not one of
them has ever lasted they all fall away
so um when you start looking at okay uh
how are we going to make this work then
it becomes um making sure that you're
getting a governmental structure that is
not deranging because of the inflation
so if you're going to take advantage of
the Innovation what you're really saying
is instead of generating Innovation so
that the government can print more money
and effectively steal the what should
have been deflationary impact of that
Innovation so um you're about to through
oh Hollow you're about to drive the cost
of potatoes down as one example I think
you agree with that yes okay so as a
consumer I want to take advantage of
that what I don't want is the government
to let inflation run hot because they
know that thanks to your breakthrough
the cost of groceries is about to
plummet and they're just going to come
in and skim that off and they're going
to do money Printing and be like hey
potatoes are still only x amount but
let's say the potatoes I have no idea
what potatoes cost $8 a bag yay that's
probably so wrong but they're $8 a bag
with your Innovation that drops to let's
say $4 a bag but they keep it at eight
because they're going to skim that
Innovation Advantage good thing is the
government doesn't set price in markets
right and when they start to that's when
things go AR what they do though is they
manipulate the fiat currency so I'm
saying by printing the money right they
they are making that potato go from what
should have been
$4 go back up to eight and so that's why
we don't see prices drop over time like
if you think technology the price of
Technology should just drop drop drop
drop drop drop like just to summarize
over the the last 250 years we've had
incredible technological innovation I'll
start with the plow the tractor 60% of
Americans worked in farming it was an
agrarian society until we got the
tractor and we got hybrid seed and we
got this ability to kind of mass produce
food using machines and systems that we
innovated that we developed that we
built and the cost of food went down the
wallet share of food has has plummeted
over the last 100 years it's now coming
back up unfortunately because of this
recent inflationary cycle um the cost of
uh fuel the cost do you see what I mean
like the cost was coming down
inflationary cycle yeah so so like I'm
I'm I'm aligning because as we've had
all of these technological
innovations it's given us permission to
spend more because the economy grows
this is this is what's
counterintuitive when when productivity
when the cost of making something goes
down Rel in terms of number of people
involved units of energy units of land
units of input let's say I spend 15
cents to make this mug instead of 30
cents to make this mug I can now make
this mug cheaper what you do as a
consumer is you don't just buy one mug
and pocket the savings you buy two mugs
and then that so the profits that I make
just went up and your ability to do
stuff with those two mugs like you can
now mix stuff has gone up and so your
productivity goes up and that makes you
make more money so the economy what
people don't realize is when the cost of
things comes down the economy grows
productivity gains Drive economic growth
when the economy grows the net revenue
you're making the net revenue I'm making
the net revenue that everyone else is
making goes up everyone's making more
money and if the government taxes
everyone just the same amount now the
government has more money to spend
consumers voters have a choice they have
a choice to say tax less and spend less
but every voting cycle voters have said
spend more and inevitably the economic
growth that has arisen from productivity
gains a percentage of it has gone into
increasing the role that government has
played in our economy and generally the
role that the government has played in
our economy has created inflation and
distorted Natural Market forces and so
that's the narrative that I think
captures kind of what you're saying
which is if we get continued technology
iCal progress we can resolve some of the
inflationary risks we're having but the
economy will grow and more tax revenue
will be generated and voters will say
let's do more let's have a new program
where we all get free bus tickets let's
have a new program where we have you
know pick pick your choice a free meal
for everyone every week at McDonald's
and the government's paying for it you
know you go down the list like there'll
be new programs that will emerge that's
the history of the last 250 years and it
started out as a place where you could
be free from the tyranny of the
government involvement in your everyday
life and in the the
economic um activity that you wanted to
undertake as a business owner as a as a
worker as someone that wanted to so
entrepreneurs came to this country for
that freedom and it still is the most
free place the most entrepreneur
friendly place the most Innovative place
on planet Earth by far and it is still
the Bastion for that but the natural
forces are that as things go well more
programs are launched and all you know
all the people that we elect say yeah
I'll give you more of that stuff in your
hometown in Brooklyn or your rural
Oklahoma let's do rural Broadband or in
South Florida we're going to pay for all
your docks at your ports now and you
know like Suddenly It's like let me give
everyone something more from the federal
level and that's just the way it goes
you know it's very hard to say that
there's
a individual or individual organization
that's is a natural force of what's
happened with governments over thousands
of years as you pointed out how often
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but in what I'm getting at is I think
the logical conclusion of having a
inflation a non-inflatable asset class
is that I can opt out of that Madness
because what will happen is the voters
will say uh or sorry the government will
say hey we want to tax you more to give
you this they're going to say no the
government's going to be like cool no
worries we'll just print more money a
word that's a tax just it has better
branding so people don't realize it's a
tax but if I have my Assets in a
non-inflatable asset class I'm I'm opted
out of that yeah and so now what's going
to happen is that's all going to come to
a head real fast because people are
going to realize wait wait wait these
guys that are storing their money over
here they still get the thing but they
don't actually participate in that
socialized sweep cost yeah through money
Printing and so then they're either
going to join them or people are finally
going to understand that a tax is a tax
by any name so you can call it money
printing but it's just a tax MH I hear
you I think wealthy people have had this
option they could buy Timberland they
could buy gold they could buy other
things that have kept them out of the
the damaging effect of inflation because
they can just sell that asset when they
need cash dollars to buy stuff that's
denominated in dollars so that's largely
what's fueled a lot of the wealth
disparity in the US in the west is
because as inflation has been driven by
government program spending and increase
in money printing the wealthy have had
the ability to protect their assets by
making investments in assets that are
inflation protected and people that
don't have the ability to do that have
not and their incomes haven't risen to
make up for that so I I think what
you're saying is sound to give access to
everyone what the wealthy have had
access to I think the question is like
are going to have enough assets to start
with right that's the big conundrum that
we have is is it have we gotten so far
ahead and that's where all these calls
for taxing the wealthy come in let's
take their assets away now and
redistribute their actual assets as
opposed to redistribute their income
which is tax work today h would that
work um the US is a very hard place to
leave when this happened in France when
they passed a wealth tax and you can
look this up there was massive
immigration out of France um and so the
government authorized the ability to go
in and pull people's tax P people's
assets as a tax every year some
percentage of your net worth gets
calculated Warr Elizabeth Warren's been
proposing this in the US Bernie Sanders
has supported it um and again what we've
seen historically is if you start to do
that wealth taxes reduce investment
because I I'm now nervous to in I I have
less incentive to take risk to grow my
asset base because it's just going to be
taken away from me if it grows that's
not directly true but there's some
psychological aversion to investing to
some degree so there's a reduction in
investment so the economy grows less and
then people opt out they leave they move
to Puerto Rico they mooved to Brazil
they mooved to Europe again I don't know
how many of my friends would do that I
think a couple of them would I know a
couple have already um but depends how
far down you go and what percentage that
is but it's a popular it's becoming a
popular kind of thought um amongst more
kind of fringy type you know like
politicians that's it's not a mainstream
for sure because mainstream politicians
are going to lose their donor dollars if
they even consider proposing that so
yeah it is h a very interesting approach
what do you think about uh mili in
Argentina love that guy that guy's the
man I need that guy I really want to
meet that guy um that makes two of us by
the way yeah that guy speaks truth to
power he's and what's amazing I wonder
if he is the beginning of the Tipping
of um the policy and the systems that we
just talked about and the challenges
that arise from the way that we have
voted and the way that we have allowed
government to grow and intertwine itself
in markets and intertwin itself in in
individual lives in the way that we
have that Argentina's recovery from that
and the voters saying we want this
guy is a way to indicate that maybe
things are typ
um in El Salvador you know they put all
the uh um cartel members in prison yeah
and made Bitcoin a national currency I
think it's a national currency now right
um and so I think that there is maybe
this moment where
mle is looked upon as the guy that
speaks truth not just to power but to
the individuals that now have access
through social media and the internet
the ability to hear these sorts of
voices clean and
true on what we have done what we have
done to ourselves um and the term
socialist is so deeply upsetting to
people when you use that term but
socialized policies policies that
provide massive social programs at the
cost of Taxation which ultimately
inflates things because the government's
involvement distorts Market forces makes
things more expensive he's shown people
that there is a way to recover from that
and fix it and get out of it and now
he's shutting down these wasteful
bureaucracies in the government in
Argentina he's shutting down these
groups that should have never been
created these programs that should have
never been created because they don't
create much benefit for people there's
no accountability in how the money is
spending the cost does not justify the
end and I think he's showing by example
that this economy can grow that people
can prosper that the government can run
a surplus and people can be taken care
of without the wasteful nonsense that's
gone on the tentacles that have grown
out of politicians standing on platforms
saying I'm going to make everything in
the vending machine free and what
happens from that after 50 years 100
years buenos arees was like the Paris of
the West and it was the most I think it
was the highest GDP per capita of
anywhere in the world who at the turn of
the 20th century or early late 19th
century um it was this go look at photos
of Buenos arus at this time or not
photos um uh uh artistic images it was
like this Metropolis this burgeoning
industrial system and social policies
crept into Argentina like they did
throughout Latin America in the 20th
century and there was multiple coups
multiple um uh um eradication of the
free market system that allowed buenos
areus to become what it had become what
Argentina had become in the late 19th
early 20th century and um and then I
think like this guy came along and said
you know people were sick of it they've
been through the pain the US doesn't
know pain like we have no idea we could
go through another 30 years of this sort
of inflation to come close to what
Argentinian Arians have been dealing
with um over the last 30 50 years so I
think that like there's a breaking point
where people are like we need something
different these systems don't work and
he could be showing people the future
he's like come from the future I was
joking with my friends the other day I
feel like he's Superman and Superman the
movie where he flies up into Earth and
remember Lois Lane died and then he like
flies around the earth and reverses time
and he brings everything back to a happy
place he's like Superman he's taken the
burden of spinning the world backwards
on his shoulders to show us um to save
lives and so he feels like that that guy
to me he's like a superhero and I think
that the fact that he doesn't give a
[ __ ] he has he acts like he has nothing
to lose he'll up on any platform and
he'll speak truth to the circumstances
irregardless of the um the common
refrain that's used to support these
decisions uh it's it's fantastic so if
anyone hasn't i' encourage them to watch
his speech at the world economic Forum
it was incredible incredible incredible
can you recap some of it his core
message um basically he said like the
government well I don't I don't want to
get into the social stuff um
there are aspects of liberalism in the
west that he also addresses which is
that we have gone too far in trying to
extend the role of government into
creating equal outcomes as opposed to
equal
opportunity and I that plays out both in
terms of social systems and in economic
decisions so
um in a natural market there's a buyer
and a seller and the seller will only be
able to sell if they can get a price and
a product that the buyer wants and the
buyer will only pay the price they're
willing to pay when the government gets
involved the government doesn't care as
much about the price because they can
just print more money so they distort
the cost of stuff they make things more
expensive that's one problem the other
one is that rather than just let the
most competitive individual the most
successful entrepreneur the hardest
working person win they're making other
false choices about someone based on
other social definition of who that
individual is based on race or class or
income and he's also made this point
that we've created distortions by
introducing a lot of these programs that
are um trying to drive an outcome
without giving freedom of opportunity to
everyone and that that creates a
distortion in the market so there there
was an element both on like the
government's building programs that are
inefficient that drive costs up that
destroys economic forces that destroys
markets and in like these social
policies that are very welled like we
want to give
everyone in the in the society a good
life the problem is that sometimes that
action causes a destruction of the
Natural Market Force that might allow
the best person you know the hardest
working person for the colle that got
into college to actually go there or um
the best business to succeed in selling
their products so there's a lot of these
kind of social policies that get wrapped
up many of which we could dissect it's
like is the cost worth the tradeoff and
some would argue yes yeah the watching
the speech one of the reasons I loved it
so much is that he really goes hard in
the paint about uh let me just tell you
what happened to Argentina we were I
don't I don't think he said the Paris of
the west but like we were one of the
great cities of the globe we were so
successful that we started adopting
socialist policies we did this to
ourselves it completely destroyed our
company our country and it it had like
this an Rand brought to life quality
about it where it was like
hey maybe we all wish that capitalism
didn't work but capitalism does work it
brings more people out of poverty than
any system ever that's ever been tried
and he just had won the historical
context to be like hey this has been
tried over and over and over it never
works leads to death leads to
destruction uh I watch it happened in
Argentina same thing play out and the
way that we're going to get back to it
is we're going to balance a budget and
we're only going to spend what we make
and we're going to make sure that we are
the home for Innovation that we invite
the greatest Minds from around the globe
to come to Argentina and create and
build incredible things and create the
the space for that and it's interesting
because you talked about you know it's
hard to leave America because America is
still the king of innovation and this is
where people want to come and there's a
cultural tradition of celebrating people
that do great things historically why do
you say that because this I think is why
I'm bringing it up this has changed tell
me about it well I think that this um
disparity and wealth that arises from
successful entrepreneurism
and the majority of Americans if you
look on an inflation adjusted basis over
the last 10 years have not seen their
incomes rise and so going back to my
original Point happiness is driven by
changes in income so when we got social
media when we got I mean look there was
always media but now there's like so
much more access I get to see what Kanye
West is doing every day I get to see the
plane that Kim K Kardashian is flying in
I get to see what Justin Bieber like how
much he's spending on his new
Lamborghini like there's an El now of
insight that I have as a um a citizen
that I never had um and we always had
ultra wealthy people in capitalist
societies there were always people who
have outsized returns someone who
figures out how to make a a Golden Goose
can start making more golden geese and
more golden geese before anyone else
figures out how to make Golden Goose and
so they get this outsized return they
get this incredible outcome in a
capitalist system but I always look at
Jeff Bezos because he's like like so so
many people have such a Negative view of
the guy but the guy gave us this ability
to get whatever we want tomorrow at a
fraction of the cost of what I was
paying even at Walmart it's unbelievable
it's unbelievable like the technology
and The Innovation and the investment
that they made they kept reinvesting
every dollar they made and people
thought they were crazy because they
were never making money and he's like
I'm going to keep investing I'm going to
keep investing and he created this
infrastructure that has unlocked value
for everyday consumers that people can
buy stuff and have access to a toy for
their kids for $8 and it shows up on
your doorstep tomorrow or lower priced
food or like this thing that you
wouldn't otherwise be able to buy
because no stores in your neighborhood
sell it this incredible unlock um in
prosperity that's a definition of
prosperity for individuals but he's
boned for having $160 billion and
hanging out on a yacht like mle said we
should be celebrating this dude he's a
superhero what he did what he did for if
if what he did wasn't valuable he
wouldn't be worth 160 billion there was
no cronyism this guy didn't go in and
steal wealth he didn't go in and like
steal a mine and pull all the diamonds
out of the mine and you know prevent the
local people from accessing the diamonds
this guy built a business he innovated
and that's what has happened countless
times in the United States over the last
years and the reality is that
individuals don't necessarily pay
attention because now we're all used to
we're all used to our iPhones so the
change and benefit we're getting it's
taken for granted I think but my income
isn't going up as an individual I'm not
making more money but this guy's got
$200 billion that's unfair I think the
world is made up of halves and have
knots everyone thinks that they're a
have not relative to some other
have and everyone is a have to some
other have
not that simple fact is what drives all
social policy all of politics all of the
economic all of the economy everything
because it goes back to my point about
desire if I'm a have not relative to
someone else's have I see what they have
that I don't have I want to tax them I
want to get them I want to compete with
them in the market if I am an
entrepreneur I want to go get the market
share they have I want to get a
politician to take their stuff away from
them and if I'm a have and there's a
have not trying to get me I want to vote
for a politician that's going to protect
my assets and I want to vote for a
politician that's going to give me
freedom to continue to have stuff and I
don't and I'm going to have conflict
with the person that that is a have not
that says that they want to have what I
have because it's my thing it's not
their thing I worked hard for it I
deserve it so that Dynamic is what
drives all of this and I think it goes
back to the point earlier about um
government
spending the have knots vote to get what
the Hales have or to take stuff away
from the Hales and then the government
is the agent by which we can all
accumulate our power to exercise that
action that's where government programs
come from
and the Hales are viewed as bad by the
have kns particularly as it relates to
individuals with wealth when individuals
are not seeing their income grow and so
um today unfortunately I think
successful entrepreneurs are viewed cast
in a negative light generally um you
know Elon has gotten very like socially
active he's got very politically
loud but he's an incredible entrepreneur
um who's built these amazing cars that
everyone wants and he's got this
platform for communication that he wants
everyone to be able to access without
restriction which is unique and his
entrepreneurism is not celebrated it's
viewed as a threat it's viewed as
something I this guy has stuff he has
power is what politicians see as power
with this open platform he has success
with his car company that the other car
companies don't have so they want to
pass legislation to hurt him he has
wealth that individuals don't have so
they hate him he's viewed as a
right-winger
because he doesn't agree with my policy
and he has the ability in the the
megaphone to be able to say that because
he's wealthy so he's he's negative he's
he's an evil character now largely um so
I think that's what we've kind of seen
this um and if you go back to the
50s I mean look throughout throughout
American history we've had
like some folks that we've bemoaned but
there was a lot of cronyism in the early
days I don't think there's as much
cronyism today I think that there's just
a lot of have have not dynamics that are
driving
this okay so how does that play out
because this strikes me as something
that if it goes too far Lennon the bad
guy had a very useful quote which is if
you give me uh one generation of young
people I will completely change the
world meaning that whatever values and
beliefs you inculcate them with will
completely um become their entire world
viiew and so if we raise not one not two
three four I don't know how many
generations of people that vilify the
successful well then people aren't going
to Aspire to be the successful so how do
you think this plays out I could argue
both sides so I could say that we head
down a socialist tunnel if we're not
careful where we want to make sure that
everyone has equal outcome which is what
Malay warns
against when the reality is equal
opportunity everyone has access to
participate is what really drives
success and drives equality
and as long as there are some young
people that will step out and build
businesses and innovate and build new
technology and participate we do have
enough of that spirit in the United
States still so I'm very optimistic
about like us
entrepreneurism um I could be worried
about the loud voice of the mass saying
we need to re revolt and return to
equal outcome we need to get to an equal
outcome
Society um and redistribute all the
wealth and redistribute all the assets
and redistribute all the access and so
on but
um I think that there's still enough
young people that succeed through
entrepreneurism that they can become
beacons and lights for the you know for
for making sure that folks don't fall
that way we need to shine light and
support and um and applaud so I I I
don't have a great answer for for you on
this because I think you could see
things go either way I mean I think
generally I have this worry that we're
at this very and this is a broader scope
point that we're at this very weird like
intersection of choosing between like
the Dark Ages and the enlightenment
which I've said on my show like do we
want to stop Innovation because we're
fearful of Technology because we're
fearful of progress because we're
fearful of the downside because we don't
like entrepreneurs because we don't want
people to accumulate wealth because we
hate success because we want the
government to do stuff for us and not
individual companies that's the Dark
Ages and if that wins the day why would
that be the Dark Ages so well I'll just
say another thing about this one of the
ways that this gets supported is the
absence of
empiricism fact data because as Malay
points
out all the data shows that
entrepreneurism that capitalism is
better than socialism he said this the
data is there economists will show you
you're not going to compel someone that
socialism is better unless you leave out
all the data that supports that
capitalism is better okay so you have to
have an absence of
information I'm gon this get I can wax a
little too philosophical here because
I'm it ends up going on too much of a
tangent but I do think that there's this
element of human beliefs that allow us
to do incredible things like we have to
come together and believe in something
as a group to accomplish a mission to to
build something like we all get together
like let's build a house I believe in
the vision of that house so I'm going to
build that house with you takes more
than one person to build that house we
all have to work together so the belief
allows us to accomplish the building of
the house but that also then opens up
room for humans to believe in things
that aren't empirical that aren't
supported by data that maybe I'll take
us down a different path and so we can
believe that the data is right and good
or we can ignore the data and believe in
something else and so I do see a lot of
alarming Behavior things that worry me
particularly on media and from
politicians where they say things that
aren't true and then people believe them
that's what happened in the Dark Ages
and it like whether it's the monarchy or
the church at the time or
whatever group was in power they told
people something that they were told to
believe that allowed them to maintain
their St status and then we ended up
saying no the sun revolves around the
earth the earth doesn't revolve around
the sun despite the data that this crazy
guy is talking about ignore the crazy
guy his data is wrong what we're telling
you is right that's the Dark Ages we
ignore imper and we ignore fact that we
don't make progress and the
enlightenment is that we get into a more
positioned rational thought mode where
let's use data to make decisions let's
look at the performance of a government
program to decide whether or not we want
to keep doing it
let's look at the results of this
experiment let's make sure that data
guides us let's make sure that we have a
principled rational thought about
discussion about what we should do and
that's not what we hear from politicians
I don't hear anyone standing up there I
mean I think Viv probably did the best
job of this like he actually came out
and gave facts about and figures about
the size of some of these government
programs and what they were doing and
this the success or failure of them mle
has shown this there's an there's a
there's a world where we embrace
technology where we say we're not going
to be fearful of loss but we're going to
embrace the risk because the upside is
worth it we can go to the Moon we can go
to Mars we can cure cancer some people
will die but we can do it we just have
to be willing to do it we can look at
the data and iterate and iterate and be
successful or this stuff is bad you know
this technology is bad this idea of
capitalism is bad the C ation of the
entrepreneur is bad and I think that's
like this like moment this Crossroads
that we are at and we have I don't think
it's like we just go one way or the
other I think we have that choice every
day but I think like we should really
take a hard look at like are we
launching new science new technology
supporting Innovation supporting
entrepreneurship supporting free markets
and allowing the individual that has the
Brilliance and the ability to narrate
and the ability to bring people together
to succeed or are we saying let's sty
that let's shut it down let's use false
facts and falsehoods and the absence and
Regulation and you know all this other
stuff to kind of keep things from
progressing and we have this moment
where like there's you know there's this
crazy set of things happening right now
in science most people don't understand
it they don't get how crazy it is but
like we are understanding how to reverse
aging in every cell in our body
and um there are several multi-billion
dollar private companies doing this
there are several multi-billion dollar
private companies building fusion
reaction systems to create unlimited
energy at effectively free production
cost coming from ocean
water either of those two things happen
Humanity's trajectory changes completely
we could live forever or whatever we
could live for hundreds of years we
could have infinitely free energy and
going back to your earlier point with
infinitely free energy I could actually
make gold out of dirt um so that system
does start to exist when energy costs
decline we have ai uh we have this
ability for all of human knowledge to be
encapsulated in a device that I can keep
in my pocket and it can answer any
question for me and do anything for me
using knowledge work and I can spend all
my time pursuing my vision of the future
and creative Pursuits and things that
I'm interested in doing without all the
tedium of dealing with data and dealing
with knowledge and dealing with labor
because machines can do that for me now
there's all these kind of like moments
that we kind of like just coming up this
curve right now yeah and every one of
them there's an effort to sty them with
regulation there's an effort to denounce
the technology as being too risky it
could kill us all it's too dangerous we
shouldn't be doing Fusion we shouldn't
be doing AI we shouldn't be doing you
know or we need to be doing it carefully
uh which means the government has to
come in and control and regulate it
which means that all of the Innovation
is going to be styed that's the Dark
Ages right that's where we miss out on
all of this upside and I think we're not
like accustomed to taking risk anymore
as we were when we were pioneers in the
west in the United States because the
people that were Pioneers in the west in
the United States had nothing to lose
they had nothing that a backpack a
satchel and a horse and a wagon and an
ax and they made their way Oregon Trail
style and they got a piece of land and
they built something today we have so
much to lose I got two cars and a
Suburban driveway I've got you know my
my kids uh I've got my IRA I've got
stuff so I don't know if I want to take
the risk of dying from this new thing I
don't know if I want to go to Mar like
you know going to Mars is cool but I
don't know it's interesting I think that
part of what's at play here is ideas so
I think ideas what people often think of
as culture and momentum those are the
two things that really matter and so
when I I I am a default optimistic
person and I'm becoming a little bit
more optimistic in in the narrow acute
moment that we're living in now but if
you would asked me a year ago I was
getting pretty pessimistic about about
the direction we were going from an
authoritarian perspective Elon didn't
own Twitter yet people didn't seem to
want any freedom of speech we were just
coming out of covid where I thought
people acted like Psychopaths it was
just bananas in terms of people giving
up all of their freedom in exchange for
safety it was just it was a very strange
time um and when I think about the ideas
that have people in their grips the
ideas are not necessarily um the ideas
of old so I I will say that um he's a
very controver controversial figure now
but it's somebody I have tremendous
respect for which is Winston Churchill
now he grew up a man of means but
despite that he was so in the grips of a
set of ideas around the greatness of
England and uh Britannia that he was so
for people that don't know his story
he's a really fascinating moment in
World War I where he fights and fights
and fights to get into politics finally
gets into politics gets a trying to
forget the name of the place but it was
a naval station and he ends up messing
up massively and it completely destroys
his career and everybody this is World
War I remember the guy that's later
going to be famous for World War II is
like I'm done I no longer have a career
I've made a an extremely big public
mistake um and but he doesn't go wallow
in it instead he goes I want to
immediately be put on the front lines of
World War I and I'm going to earn my way
back into the government and so they put
him on the front lines of arguably one
of the most gruesome bloody wars ever
this is trench warfare and he said to
his mother it matters so much to me to
have a reputation for physical courage
meaning I'm not I'm not brave at a desk
where you know it's like quite easy to
be brave I'm I'm getting shot at and I'm
brave and so he used to do like all
these like really dangerous um uh they
were just like routine sort of you walk
the perimeter thing and people didn't
want to go with him because when he
would get shot at he would just stand
there and people like what are you doing
and he's like by the time they've shot
at you you either got hit or you didn't
and so he's like now the danger you know
is passed and so he just had this
attitude of like I'm not going to be
cowed I know what we're here for I'm
going to get this done I'm going to lead
I'm going to show people what it's about
that is a guy who had everything to lose
but what he was focused on was somehow
someway the idea got planted in his mind
that what mattered was self-respect and
when I look back in history and look
very much these could be the blinders
the rosecolor glasses that I wear about
my own life but so I grew up middle to
lower middle class and my parents are
just like all right we can't give you
money in fact I graduated college with
debt can't help you there but my dad was
obsessed with kids you're going to learn
work ethic and so from the time I was 12
I worked in a door Factory then a paint
factory than a paint Warehouse like just
doing all these
horrendously uh physical labor jobs that
I did not enjoy in the slightest and my
dad just kept saying but you're going to
know how to work when other people don't
and you need to respect that and you
need to understand how that's going to
serve you and so of course that ends up
I remember one of the earliest uh we we
got a video this but it somehow got lost
to the sands of time um Quest starting
nent of course everything is hard and I
had learned how to drive a forklift back
in uh the paint Warehouse days and when
all of our equipment showed up we
realized oh my God we don't have a
forklift we have no way to get this
equipment off this truck and we're all
like oh everyone else was looking around
saying how are we going to do this and I
was like guys I'm actually a certified
forklift driver and they're like what
and so we borrowed a forklift and I was
able to get all of our gear off the
truck and I looked in the camera and I
said Dad wax on wax off you told me that
all these skills would come in handy one
day and so but that set of ideas drove
me and it was the desire to get good at
things that I wasn't good at to earn a
reputation for being the hardest worker
in every room that I was in and so all
of those things end up paying off and
then I remember when I first got on
camera I was telling people all the time
hey you should go out work for free uh
learn something exchange instead of
trying to optimize for money optimize
for knowledge and connections yes and I
would just get lit up oh Tom like these
people are just being taken advantage of
of course you say that cuz you're rich
and I was like hold on do you know how I
got rich like I was wasn't trying to
maximize my dollar I was trying to
maximize knowledge and connections and
so there I can feel that a spirit has
changed in some way and that people are
no longer in the grips of the same ideas
that I was raised with that it was just
a water in the 80s to be the hardest
working person in the room to strive for
more to like pick your biggest dream and
go for it to celebrate people who were
successful and to like my whole life
until it actually happened I was the
temporarily embarrassed Millionaire
right yeah I'm broke today but I'm not
going to be broke forever and so that
whole Spirit has been exchanged for what
you laid out earlier yeah like people
just expect correct so that worries you
that worries me to no end and my default
stance is that this is a pendulum that
swings and it only swings based on pain
and it will keep going in One Direction
until it is absolutely intolerable and
we will swing back right and the reason
that I do this show is that the what you
need is not just pain you need pain plus
an idea and so when you have a good idea
hopefully if you have somebody that can
articulate that idea well that you don't
have to be in as much pain before you
change course but yes when I look at
Trump Biden as the nominees for 2024 I'm
like oh yeah th this is a group of
people who need enough pain to go this
is ridiculous
yes yeah I mean there's also like what
do we you could ask yourself what do we
celebrate like in the early 20th century
mid 20th century we celebrated people
working hard we celebrated entrepreneurs
and scientists having
breakthroughs if I ask you the question
today what do you think we celebrate
[Music]
today victimhood
unfortunately
victimhood you've had it hard
celebrity yeah but that gets a bit of a
mixed bag but
yes so I think that's the that that's
the indicator for
you and um if that's what we pronounce
if that's what we celebrate that's what
we
manifest the problem is like I think the
the the folks who do
get recognized like it used to be movie
stars were like great
success
um business you know business tycoon
were LED
laed um now it's a celebrity who did a
lot on
Instagram and the problem is that's Out
Of Reach for everyone like it this there
it that's what everyone aspires to is
everyone like I think that was the
number one thing out of a recent survey
coming out of high school is like what
do you want to be when you grow up a
social media
influencer because that's what we
celebrate um and I think that the
challenge then is like well people that
are building businesses in other ways
people that are making stuff scientists
it it becomes a very hard thing to kind
of relate very obvious thing as to why
we're not really seeing people pursue
those interests because it's not really
what we celebrate as much
so yeah so my hope is that we can begin
to
celebrate some um creation Innovation
risk-taking people that are bold uh
success people that pull it off like
when I look at Elon Musk I get it like I
get why some people don't like his
politics fair enough I mean it's uh
there's a bit of a sort of boyish
troll nature to his uh his ongoings on X
but uh at the same time he is he is the
greatest entrepreneur of Our Generation
as far as I know there might be somebody
that's done even more but holy hell and
I'm I'm thinking of Bezos right along
side of him Bezos is amazing but when I
look at the way that Elon has been able
to replicate it in just wildly different
companies it's it's pure insanity and
doing it from an engineering standpoint
is really really breathtaking um but of
course like you said they're being
vilified okay uh to really begin to
tease this out walk me through where do
you see the key areas of innovation that
you think have the shot at pulling us
out of the debt spiral that could
reinvigorate people get them excited
create a life of I'm assuming
energy abundance or just dropping costs
on things that people really care about
is going to be a key part of that
what what's going on that we should be
really looking at well there's not much
to act on or to know about there's this
free there's this option it's like a
call option that the price is like 10
cents right now on on things like Fusion
Energy right so Fusion Energy is this
whole new way of creating
energy um you can take heavy water
molecules like water with an extra
Neutron and if you get them moving fast
enough if you get hydrogen moving fast
enough and you get two of them together
they fuse and they release energy and
there's a net energy outputs you got to
get them moving fast enough and close
enough so high energy high
density so the way we do that is the
same way the sun does it the sun is a
giant plasma Fusion reactor plasma means
that all the electrons have spun off the
atom and all that's left is the nucleus
the protons two protons fly into each
other when they fuse they end up forming
helium from hydrogen and in the process
release some energy and then there's all
these other Fusion reactions that happen
in the Sun and all that energy is
released in the form of what's called
neutrinos as well as light photons as
well as electrons that kind of come out
in these plasma releases that come out
these Jets so the energy from the sun
heats us right those photons drain us
they they drown us they're heating us
and we're just getting a tiny tiny tiny
fraction of all the photons coming out
every second from the Sun that's just
going to run these Fusion reactions for
billions of years before it runs out and
everything's been fused
together we can now do that or we are
trying to do that on Earth in a
controlled Way by creating a plasma
where we take these atoms and we spin
them around and we spin them so that
they're going so fast and then we use a
magnet to try and squeeze them so
they're super close together and when
they're close together they start to
fuse and we capture the energy that
comes out and all the physics of doing
this took us decades to understand and
figure out and start to build little
Engineering Systems and in the last
decade or so there's been a bit of a
Renaissance and acceleration and fusion
technology we don't have anything doing
it today at scale but there's a lot of
companies there's about 70 companies now
that have been started up that are doing
fusion reaction systems and if any one
of them Works theoretically you could
take water from the ocean and using just
two swimming pools of water power all
the energy needs of planet Earth on all
of our systems today isn't that crazy W
so that's Fusion it's not here today
everyone's always like it's a decade
away you know so it's always been this
kind of thing that's people are like
calling [ __ ] on all the time but the
underlying engineering is improving the
underlying science is there so this
could be a reality in our lifetimes and
then you could see Fusion reactors
everywhere which drops the cost of power
and increases the availability of energy
dramatically that's super interesting
you know everything largely can be
replaced with energy in terms of cost
you can you can make more stuff if the
cost of energy goes down you make more
and more stuff at a lower cost you can
make new materials you can run computers
I mean like the power of energy is a
huge driver for economic prosperity and
growth um and historically energy
consumption has increased per capita as
GDP per capita has gone up so we've
demanded more energy as we've become
more prosperous and so that's only going
to grow if we want to have a prosperous
Society we need to make a lot more so
energy and if you look at where GDP
projected to grow by the end of the
century which is totally random like
math and you project where population's
going to grow by the end of the century
the GDP per capita demands that we have
to increase energy production on Earth
by something like 3 to 10x 10x plus some
people would say how are we going to
increase energy production by 10x on
this Earth we can't so this we need a
new paradigm we need a new system so
that's the argument for Fusion why it's
potentially gamechanging but still ways
away Gene editing is a gamechanging
technology so we're using this ability
to use proteins to change to go in and
alter genes for human therapies for
destroying cancer for creating new cells
tea cells that can go in and Destroy
cancer how much is this happening right
now with real human cells all over the
place so there's tons of gene therapy
products on the market now there's
there's two categories there's Gene
therapies where you actually go and
alter the genes in cells where you have
DNA errors you have problems with your
one of your genes and there's a lot of
these diseases that people are born with
where one of their genes has a letter
that's wrong and a gene is just a a
sequence of DNA it's a bunch of letters
and every Gene makes a protein that's
what genes are they're just the code to
make a protein and they're these little
things in our cells called ribosomes
they take a sequence of the the the gene
take this the a copy of a gene and it's
like a little ticker tape it sucks it in
and it prints out a protein so ribosomes
make proteins millions of them a second
in every cell just pumping them out
and they come from the gene expression
that happens off the DNA so genes are
the code for proteins and then proteins
are the machines that do everything in
life in biology proteins stick stuff
together they rip stuff apart they
assemble new molecules so the genes make
the proteins that make everything
proteins are like little robots in
biology they make everything so when
there's something wrong with a gene when
there's a letter that's off the protein
can be disfunctional and you can have a
disease so we now have this ability to
go in and change that that sequence of
that genome in your cells and improve it
for all these different conditions that
are being addressed now there's a
separate area of medicine which is cell
therapies where we're taking cells and
then editing the DNA of those cells to
get them to go and do something in the
body and then we stick them back in the
body and they go and kill cancer cells
or they go and repair something and so
that there's about eight or nine of
those products on the market today wow
for Cancers and um people that get these
Cancers get this therapy Cancer's gone
it's unbelievable so we reprogram a a
te- cell we stick it back in the body
and it goes and destroys the cancer by
the way that's 15 years old technology
the stuff that's going on now is like
light years ahead of that and it has to
go through clinical trials and
Regulatory approvals and testing and all
that stuff but the stuff that's coming
to Market over the next couple of years
there's over a thousand cell and gene
therapy products in testing and trials
right now to come to Market are you
aware of any that really show promise
Lots I mean things that can cure
blindness um again lots of cancer
therapies lot of autoimmune
therapies everything you can think about
in terms of human disease can be
addressed by some cell gene therapy
product that's in Trials right now very
likely and then the other stuff I
mentioned earlier which is actually
changing the um the epigenetics so not
just the genes but changing which genes
are turned on and off in a Cell can
actually make the cell super young this
was discovered by a guy named yamanaka
he won the Nobel Prize for this you have
all these cells in your body they all
have the exact same DNA the only thing
that makes one cell different from
another cell is which genes are turned
on or off so I told you earlier genes
are just making proteins if some of
those proteins are turned off that cell
looks like a skin cell and if other
proteins are turned off and other ones
are turned on that cell starts to look
and act like an eye cell or a muscle
cell or a heart cell so all the cells in
our body are different because of the
genes that are turned on or off so
yamanaka figured out that if you turn
turn off all the Gen if you turn on all
these genes using this thing called the
yoa factors basically four chemicals you
apply to the cell they're proteins then
the cell acts like a stem cell like an
original cell from the embryo and you
can then use that cell and turn it into
any other cell and make new eye cells or
make new skin cells or all this other
sort of stuff so creating stem cells
using yamanaka factors and working with
them in research is what all biologists
and Life Sciences research are doing
today that's like common practice people
don't realize this
but later it was discovered that instead
of resetting the cells back to being
like stem cells you could partially
reset them so a slight changing in the
dosing of the factors and putting
different factors in caused the cells
instead of acting like a stem cell they
actually reset all of their epigenetics
which genes are on or off back to how
they're supposed to be when you were
first a kid and suddenly those cells
start to work like when you were young
they're more youthful they have more
energy they are not spending all their
time trying to fix up all the mistakes
that the cell's doing what happens is
the reason we age is as we get older the
stuff that turns genes on and off in our
cell degrades and so the gene regulation
of a cell is wrong and the cells become
dysfunctional and when the cell becomes
dysfunctional our skin wrinkles our
eyesight goes our heart start beating
slower our liver doesn't do its job our
kidneys don't do its job so all those
cells are slowly not doing their job as
well the muscles don't move as fast but
if we could reset those cells so that
the the the genes that are turned on and
off are correct again then all those
cells will work perfectly you have
everything you need in your body all the
DNA is intact in all your cells all your
cells are normal cells they just have
the wrong genes turned on or off so if
we can reset that suddenly all the cells
act young so there are several companies
that are doing this work that have shown
progress that it looks like there's
going to be a path at some point in our
lifetime to actually rejuvenating cells
in our body which is just an insane
thing to think about we see it in Labs
we see it working in mice we see it
working in other animals it's just a
matter of time before we get all the
pieces together and create Therapeutics
around this imagine becoming like a
young person again by popping a pill or
taking some treatment so that's another
area that's super interesting is this
like Rejuvenation and then Gene editing
being applied like the work I do is
mostly in agriculture working in plants
and we're totally changing a lot about
uh making plants more genetically
diverse increasing the yield improve the
performance the health the growth how
quick the plants grow humans use half of
our land to grow stuff um you know to
grow animals or to grow crops we have
the ability to actually improve the
quality of all those crops make them
grow faster bigger healthier um and so
we've developed the system for doing
that and so that's another so you know
this whole technology area is super
interesting and then obviously AI we
everyone talks about AI so tell me what
are your thoughts I think that's an
important one AI is just an unlock for
people
um you know when when some of the tools
first came out I remember I used to use
Adobe Photoshop as a kid I would do like
a lot of graphics and uh like stuff in
Photoshop for fun or for work I would
like go out as a kid and like do jobs
for with people and stuff and um I got
Kai's power tools you remember Kai's
power tools I don't know if you ever Ed
Photoshop it was like this this plugin
for Adobe Photoshop in the 90s where it
could do filters so you could blur your
photo or you could pixelate it or
sharpen it and it was statistics applied
to the Matrix of pixels so each pixel is
a number it's a matrix it's got a row
and a column and each one's got a number
and basically you could apply a
statistical function to that Matrix of
numbers and it would change what those
numbers were and when you look at it
visually it looks like the photo got
blurred or the photo got sharper so it
was incredible like you could use
statistics to do stuff that people that
were previously using Photoshop had to
go and pixel by pixel and change and
they were just kind of looking at it and
then they change it and they look at it
that's what AI is it's this
statistically driven unlock for us where
our productivity goes through the roof
where instead of going in and changing
every pixel I can just say hey I would
like a to write a book today 300 pages
and it's about government involvement in
markets go Source all the data for me
aggregate it in my style and then I want
to go in and edit it with you and by the
end of the day I've written a novel like
that's the unlock that AI provides
individuals can have more freedom and
can be more productive and create more
stuff and again going back to our
earlier
point the cost now of being a writer a
copywriter goes down the value of being
a copywriter goes down so the income for
the copywriter goes down but the ability
for someone to now create a 100 novels a
day increases output and so the economy
grows the market grows and so that
copywriter can go become a novelist and
they can write a 100 novels a day and so
now there's more novels for everyone and
so the consumption goes up uh that one
feels more inflationary than then that
consumption will go up but so the big
thing that I wanted to get a sense of is
okay there's a lot of really amazing
things happening in technology but I
think it needs to be married to your
earlier Point are people going to reject
this or they going to embrace it right
so let's take the ones that you laid out
on the table so Gene editing I think
that's huge uh you've got Gene editing
inside the human you've got Gene editing
inside of the plants
uh you've got Ai and the impact that
those are going to have those three feel
very germ to the argument of are people
going to embrace these or they going to
reject them I'd love to know your take
do you think that we um Embrace these
and and as much as you can give it to me
however you want but as much as you can
Hue to what you think will actually
happen knowing the way that humans
respond would be incredible so I think
seeing the benefit is the unlock right
so in human health we see the benefit of
these tools because people's diseases
are being cured so suddenly the concept
of Gene editing or the concept of using
gene editing to create new therapies
which sounded scary in the first place
and everyone was against Suddenly It's
like wait my uncle got cured from cancer
with one of those therapies this is
awesome and I think that we're seeing
that so that term is no longer an evil
term because consumers cannot see the
the problem with technology is it's
always ahead of the curve like you see
the the AI Stuff shows up people talk
about it Terminator 2 came out in 30
years ago right um people see all these
things before they realize the benefit
from them and
um I can tell you if someone got their
energy bill cut by
75% they probably wouldn't complain as
much about having a nuclear power plant
100 miles away from their home they'd be
like wow that's pretty amazing like you
know and you know then you understand
all the protocols for safety and all the
regulatory systems that keep you safe
and so on and in human therapies we're
seeing all these lives being saved and
we're not hearing tons of stories about
people dying from gene therapy so the
attitude shifts and the benefit is there
so I think like that's what happens over
time and unfortunately in the early days
there's a lot of this like wait don't go
too fast slow down like make sure this
works make sure the benefit is there
make sure the downside is understood and
and protected and you know there's
decent systems to do that but it's not
viewed necessarily as an innate good
until people realize the benefit and
then it becomes a little bit more like
like if I tell you
antibiotics um it's interesting if you
fast forward like antibiotics like
people died from infections all the time
before we had antibiotics now we got
antibiotics you get an infection you
take one you live kind of take that a
little bit for granted now now people
are like antibiotics they wipe out your
gut biome like it's I I generally try
and avoid them just to be clear like I
don't think they're but if you're going
to die from an infection you got to take
a [ __ ] antibiotic yes I need an
antibiotic so um so I think that there's
also this like element of at some point
maybe we get to take things for granted
a little bit too much and we forget
about like once you're on the other side
of that curve now it's like I I could
you know I could start to talk bad about
it again you know it's like it's
interesting I have a slightly
more yeah I try not to ever say jaded
but yeah um perspective on this so
I think we're going to go through
something very weird over the next three
to five years and it's going to be
largely driven by technology and some of
the promises we thought it would deliver
but didn't so if you look at um what
happened with social media social media
made all these promises is going to make
you feel connected it clearly has not
done that if you read Jonathan Height's
work it's like increasing rates of
suicide among young kids causing some
sort of disturbances that cause them to
uh really struggle with anxiety
depression uh also gave the government a
way to manipulate people and so now
people have this really jaist eye toward
they still use it but they have a really
jaice eye towards what it is and how it
can be used to weaponize against you uh
GMO Foods become this incredible unlock
that allows us to feed the billions of
people that we thought were just going
to collapse the planet and you know
malus was going to be right and everyone
was just going to die and it didn't
happen and it didn't happen largely
because we make huge ations in
agriculture which allows us to feed
people with things require less water
are more hearty resistant to Drought uh
plague so on so forth absolutely
incredible and yet you have people that
are like I won't eat GMOs I won't let it
touch me no way this is bad this is
horrible um Monsanto I know your last
company was bought by Monsanto people
just think of it as the Death Star the
evil empire so there's like all this AI
I mean don't even get me started on
people are going to reject that I I
think with AI and neurolink type things
where you're augmenting the human body I
think there's going to be a true
bifurcation and there will be Puritans
who are like I'm pure I don't have any
uh augmentations in my body I don't use
micro Technologies uh which of course
will be tied into conspiracies and all
that um don't augment my body I don't
use ai ai I don't engage with it at all
and then you'll have people that go hard
the other way I've augment with
everything that I can get my hands on
and I don't have real friends it's all
AI my wife is AI uh all my friends are
AI etc etc so and and I think that
you're going to start to see in the next
three to five years the beginning of
that split and then where is that in 15
20 years I think is going to be pretty
dramatic now I think the people that
don't Embrace new technologies will end
up being relatively small uh but whether
they it's just sort of a disdain for
each other or whether that actually
erupts into localized violence I don't
know we'll see the split you define is
probably easier to think about in terms
of people that are wealthy and have the
luxury and the privilege of not adopting
a
technology and those who aren't where
the technology enables them to
progress um so I will buy a handcrafted
clay plate set for my family that cost
me like 80 bucks for four Fring plates
because it's like this was made by this
artist and don't you love her work she's
so great she's got a studio in Oakland
love her work you know she's so great
and we talk about the artist and I pay a
premium for that most people can't
afford $80 for four plates most people
take advantage of the technology the
plastic plate that they can get a Target
where they can get four plates for two
bucks because that's the majority of the
world not even X the US right there was
this great website I don't know if it's
still up called Dollar Street I don't
know if you've ever seen it but they um
went out and took photos of what it was
like for people and how they live every
day their common use items based on
their income and their their wealth how
do you cook your food how do you brush
your teeth how do you store your food
and some people are like using a propane
burner to cook their food and then you
go to like an upper class family and
they've got like a like a gas stove in
Norway you know like they did this all
over the world it's really incredible to
see and you realize how much that person
that's like living in a hut doesn't have
furniture sits on the floor would
benefit from having access to the
internet on a mobile phone the mobile
phone and the AI could create an unlock
for that person like you and I could not
imagine for you and I we could spend
five minutes or have an assistant of
ours search stuff on the internet for us
but for that individual with nothing
this would be an incredible unlock for
them and a benefit for Humanity so what
we generally see is this aversion to new
technologies mostly being held by the
privileged wealthy class those who don't
need it and quickly adopted eagerly
adopted by those who will progress
because of it and then there's this
weird thing that happens where the
wealthy have the luxury of having
non-technology Assets in their life
having a handmade clay plate I don't
want to buy a I can have someone make a
clay plate for me I can buy organic I
can buy nonong GMO and feel good and
tell my parents and my family and
everyone we're eating nonong GMO tonight
honey we can do it or I'm going to get
this handmade painting rather than a $2
poster to decorate my wall the
technology for the printing press and
whatever that made it's the $2 the
poster for two bucks is an incredible
unlock because someone can now put a
beautiful poster on their wall but
because I'm wealthy I can have someone
make something by hand with oil so or
the Barista that makes me the special
coffee for eight bucks as opposed to
using $2 folders instant or 30 Cent
folders instant coffee at home which the
majority of people do so the I think
there's like a luxury premium that
Associates itself with non-technology
assets that we will continue to see and
you'll you start to observe it in your
life like there's a lot of stuff that's
like Tech that we're like paying a
premium for and we feel good about it
it's authentic it's genuine it's more
real and we create this narrative as a
luxury class that we can and should buy
that and afford it and show it off to
each other but for most people like
progress is enabled by technology and so
they're quickly trying to progress in
life I don't want to be living I don't
want my kids living on the Hut floor I
don't want my kids you know having the
same job I have I want them to progress
and so we're going to use these
Technologies to help us do that and so I
think that's really important
particularly in this like if if if
you're wealthy and let me let me Define
wealthy like you know the average per
capita income around the world is
probably somewhere between six and
$15,000 a
year and large percentage of the world's
population are making less than $6,000 a
year large percentage think about that
for a second so like anyone Living in
America is better off than the best you
know the top 1% in most of the of the
world um and so we we've created a lot
of luxury goods categories that we pay a
premium for that disassociates from
technology it's a weird psychological
thing but it's like you know it's
utterly fascinating so to me this feels
like wealth in and of itself has this
sort of self-limiting
effect uh the wealthier you get the more
likely you are to not have kids so the
more that you're struggling the more
kids you're likely to have I think
that's there's another study that shows
to your point the more wealth you have
the higher your calorie consumption goes
and then you become obese and then after
a certain um income threshold you start
to diet and you start losing weight and
then you're on these crazy keto diets
and all the stuff that our friends and
cohort like live in is like eat less I
was so funny I had some friends come
over on Sunday and I was like you guys
want me to grab you a snack we're G have
some wine in the backyard and they're
like wait you're still eating like it's
like the trendy thing is to not eat now
and I think that that's like
representative in a lot of the
socioeconomic data you see incomes rise
and then obesity rates climb diabetes
climbs and then super high net worth
people higher income people suddenly
they get really healthy and they go to
the gym and they they can afford to do
all these things so the self-limiting
thing is kind of funny and in the diet
space that actually makes sense but when
I think about wealthy countries giving
themselves a ceiling that they sort of
Smash against and then another country
will come behind to your point about the
people that um right now they don't have
and they are they don't want their kids
living on a you know the dirt floor of a
Hut and so they're going to adopt this
stuff whether it's uh whether GMO foods
have a potential downside or not they're
they're going to take it because it
helps them capture wealth um but what I
worry about over here on the wealthy
side you know and I don't mean that you
have to have a ton of money I just mean
you're living in a a wealthy
industrialized Nation like America where
now all of a sudden everybody has the
luxury of being afraid of wanting safety
over Innovation and so they regulate
this to death and this ends up not
moving forward one of the things that
got me thinking about this is what
you're doing at ohal um I know how
bizarre people get about GMO foods and
so using that as a litmus test um how do
you think that's going to be embraced in
the weird countries Western educated
whatever I forget what the other ones
are um but do you think that that's
going to get slowed down through
regulation or are people going to adopt
that yeah I I mean do you want me to
explain it so I'll just talk about GMOs
for a second you know the way Plant
breeding which is the process by which
we make better plants that grow bigger
in our Farms the bigger the plants grow
the more food they make the lower the
cost of food the more the farmer makes
right you want to get more stuff grown
per acre it's better for the Farmer they
put Less in they get more out they make
more money it's better for consumers the
price of food goes down that's the
progress of human human civilization
going back to 23,000 years and plant
breeding historically we just kind of
picked the biggest plant and then we
took the seeds and put those back in the
ground and then we picked the biggest
plant next year and we took those seeds
and put it back in the ground we kind of
just had these observations and then we
got really good at observing physical
characteristics of the plant I want it
to have deeper Roots so it's more
drought resistant I want it to grow
faster early in the year so that it
avoids the the frost the risk of frost I
wanted to grow bigger seeds so I can get
more food out of it and so that's called
the phenotype or the physical
characteristics of the plant and plant
breeders started to breed for specific
phenotypes picking the plants that had
those sort of characteristics and then
making new seed out of that in the 90s
we got DNA sequencers so then we
realized we could actually look at the
genes that are making those physical
things happen we saw the gene that makes
the seed bigger the gene that makes the
root deeper the the gene that makes the
plant grow faster all of those genes we
could see through DNA sequencing so now
we're getting like an insight into
what's causing those characteristics so
then plant breeders started to breed
plants based on the genes that they were
seeing rather than plant the seed
waiting for it to grow and then
measuring it you could just look at the
sequence of the DNA from that seed and
then just figure out which seeds you
want to plant and which plants you want
to cross together and so this was called
molecular breeding which means using DNA
and an understanding of the DNA the
genes of the plant and then this idea of
GMOs came around and the idea of a GMO
or transgenic crop is that you take the
DNA or Gene from another species and you
stick it in that plant and now that
plant Will Make A protein that does
something new that it doesn't natively
do so one of the original ideas was to
put a protein from a bacteria called
bailus th genous in corn and by doing
that that protein that that corn would
now make causes rootworm to die when
they eat the corn root worm is this worm
that kills all the corn plants it eats
them up and so corn field get decimated
if you don't get rid of the root worms
and prior to this farmers were going out
and they were spraying Fields with
insecticide seven times a year with
toxic synthetic chemicals to kill the
the worms and by getting the corn to
make this protein this one protein binds
to the stomach lining of a worm doesn't
affect humans or any other species we
can measure that we can see that so just
affects the worm the worm won't eat the
corn anymore and the yields will go up
and you don't have to spray the
insecticide anymore so that was like an
that's called BT corn it's still every
corn planted in the world today is BT
corn that's you know got this trait in
it and that's a GMO trait meaning it's
got the gene came from another species
and it was stuck in there there was
another one where they put a gene in
rice to make golden rice so the rice
would make vitamin A so it could help
cure river blindness for people in South
Asia that aren't getting enough vitamin
A so now when they eat the rice they're
actually getting vitamin A while they
eat it and that Gene isn't native to
Rice you have to put that Gene in there
to get the rice to make vitamin
A but again people got worried about
about messing with nature messing with
genes but humans have been breeding
plants we've been relating to Nature
taking winners out and throwing away
losers since 23,000 years ago so
breeding has been a big part of what
we've done as a species and this idea
that humans are just going to sit around
and wait for stuff to fall off a tree or
wait for animals to die and then we'll
eat their carcass that is the true
natural state of things any aspect of
farming is humans intervening and
Engineering our planet and getting
involved in making the things we want to
make so GMOs got this bad rap they went
really South people hate them they're
highly regulated all over the world and
the consumer mindset is these are bad
they're doing things that we don't
understand they're doing things that are
bad for the planet there's all these
other rationalizations for why they're
bad and they we can break each of them
down but we don't need to like go
through all we can talk about all the
claims that have been made but I've
tried to explain generally what they are
and we can measure what they do we can
measure the protein that they're making
we can measure whether it's good or not
for the plant and for people and for the
planet and species and so on Gene
editing came around and what Gene
editing is is it's not about taking DNA
from a foreign species and sticking it
in a plant you basically apply a protein
to the cell of a plant and when you
apply that protein it causes a change in
one or two or a couple of letters in a
gene in that plant so you're not
introducing foreign DNA there's no
foreign DNA inserted you're not creating
you know non-native genes what you're
doing is you're basically telling the
plant I want to create this Gene
PL you want aange so that
rathered CES hundreds to toen in that
Gene you can specifically Target that
change and make it happen instantly and
it created this unlock it creates this
unlock for cancer Therapeutics creates
this unlock for treating human disease
and it creates this unlock for making
those physical traits happen in plants
that we would otherwise have to spend
thousands of years breeding the plants
to get to happen and we can have it
happen instantly these are traits that
already exist in the plant these are
genes that already exist in the plant
and you're basically turning them on or
off or making a slight change to them
that would otherwise happen naturally so
Gene editing is being treated in a very
different way than GMOs the regulatory
environment on it is very different in
the US you can file a form say there's a
gene edited plant the government says
we've signed off on it there's no new
DNA introduced you can go to market with
it it takes a couple of weeks whereas
GMOs it's like many many years all these
agencies have to get involved there's a
lot of approvals so um Gene editing has
allowed all of these new uh programs to
launch that are allowing plant breeders
to create better healthier bigger plants
that have better consumer traits more
nutrition using the DNA that's already
in the plants you're not changing
anything you're not bringing an outside
DNA you're basically just turning traits
on or off that are already in that plant
you just don't have to try and do it
randomly through breeding so that's the
magic of uh that that basic technology
and so it's being looked looked at
differently but there's still always the
risk of consumers coming along and
consumer groups saying we're messing
with nature again and again you got to
go back 23,000 years to see like humans
have been breeding plants messing with
nature for 23,000 years when we first
started breeding corn it was a little
grass it was this big and it had some
seeds at the top of the grass and now
corn is 12 feet high and the corn C is
this big and so breeding over 9,000
years created modern corn and the
original natural corn was just a grass
that was that big and that's the fourth
largest source of calories on Earth
today is that corn plant so this has
become and it's the way we feed animal
for animal agriculture which you know we
talk about another time um but that
whole system I think is where you know
people don't really have the full
context of this and when you hear a
sound bite that's pretty negative on you
know you want to believe it you're like
it feels good to be against the
technology it feels good to be against
Monsanto be against the man be against
the big system and that goes back to my
point earlier about it's easy to fall
into the Dark Ages trap where we say
let's sty this this this technology
because you know there's a lot of
reasons why people are able to kind of
cast it in a negative light without
actually having that context of the
benefits um and it's really sad like
golden rice never took off it was like
an incredible product make vitamin A for
a billion people in their rice Source
but people were nervous about we don't
understand because people don't
understand genetics they don't
understand DNA sequencing they don't
understand how the system work they
don't understand how it does this it's
scary you know um and similarly AI which
is basically just a statistical process
on a matrix of numbers is similarly
scary like um when you break these
Technologies down I think it's important
to do this sort of work where we talk it
a long way about do you have any
dystopian fears about
AI uh yeah I was in Vegas and I was a
little hung over and I was kind of like
sitting there in a cafe a couple months
ago like a year ago and I saw the uh
like some kid had a drone and I was
looking at all the people around me and
I was kind of in this like weird State
and I was like man like what if that
drone just like AI like just shot
everyone like it was this random thought
I had and it was like why did I think
that that's crazy a couple weeks ago
China put out this video of this
military dog have you seen this thing
the Swarms isn't that crazy uhhuh yeah
so I look at that military dog and I'm
like dude they put a machine gun on the
back of the military dog and it's got
the AI Vision it can run autonomously it
can run disconnected from the network so
it can run on its own compute at the
edge it's got its own computer on it and
you could see China making 10 million
100 million of these and then they just
go out in the field and their job is
just wipe out people dude that is
dystopia is a literal Black Mirror
episode so there is dystopia and fear
yes yeah it so okay so I very much want
to see people adopt these Technologies I
am I am for sure a techno Optimist and
find myself extremely compelled I won't
be an early adopter of things like
augmenting my own body but when I really
think about where this all goes I'm far
more compelled by the technology than I
am fearful of the downside side however
humans um if we got as scared as we got
over covid which had a I mean less than
2% I don't think anybody argues that uh
death rate like I just don't see people
um continuing to do good calculus in
terms of okay what the long-term
advantage of this of this so but you did
say something that gives me hope which
is that there are people that are
struggling that they'll adopt it out of
necessity like they they couldn't Ino
conscience not bring it to their country
because their country is struggling so
it becomes a does this become an
interesting tale of leap frogging where
countries are adopting some of the stuff
um even though other people might be
afraid of it and I'll I'll put one on
the table I'll be very interested to see
how the community reacts to this but
cellular meat which I think is really
interesting but I think it's going to
get massive push back so I think
cellular meat will probably get more
pushback than GMOs ever did uh can you
tell people what cellular meat is and do
you think I'm out of my mind with that
you're 100% right it's been banned in
Florida already and there's seven other
states that the state legislatures are
um looking at bills to ban it and there
is now talk in the US Senate of putting
together a bill to ban it so um to make
a pound to make a a calorie of beef
takes 30 calories of energy from the
rest of the food system to feed the cow
to make the corn the water all the stuff
that goes into growing the cow
processing the cow transporting it Etc
there's an incredible amount of energy
to make one pound of
beef and that's the way the the system
works today so the question is
scientifically that people have been
asking is can we take the cell from the
cow that makes the the cow's muscle the
muscle tissue and then can we get it to
just grow the muscle in a vat in a in a
in a giant what they call bioreactor
like you make beer like a like a brewery
like a fermentation
interesting so you pour sugar you pour
energy in and you get those cells you
make some of those ches to the cell to
get it to suck up the sugar water and
double and double and double and grow
muscles that's that's a simple way of
describing it you also have to put
proteins into the vat to trigger those
cells to grow to make them think that
they're supposed to be growing you're um
trying to make sure that there's no
disease in there that there's no
bacteria that enters there's all these
steps in try to make this work so
theoretically we have all the tools we
need
to grow the muscle from the cow without
the cow and use less energy use less
carbon lower footprint and theoretically
as it scales up lower cost so instead of
paying six bucks for a pound of ground
beef you pay three bucks for a pound of
ground beef if these systems work right
because all you're doing is putting a
cell in there and then feeding it sugar
and some sort of nitrogen Source um
because nitrogen is needed to make
protein so that's the concept and people
have been talking about this for 20
years and they've been working on it and
there's now dozens of startups working
on this and some of them are making fish
chicken eggs milk cheese
cows goats there's one that's doing F gr
there's one that's doing Japanese eel I
mean there's all these companies that
are focused on these different animal
products and they're all taking
different cell lines and iterating on
the manufacturing process to try and
make the same thing you would otherwise
get from the animal except made in a
bioreactor in in a tank and it's the
same
cells it's the same protein it's the
same everything else that you would
otherwise be consuming so the FDA
started approving these they started
reviewing them and they're like okay we
got it we've analyzed it we've studied
it there's millions of dollars that have
gone into regulatory review on these
things they started approving a couple
of them each one of them has to go
through regulatory approval in the
US and as they started getting approved
cattle ranchers started saying this is
messed up and you're going to destroy
our industry you know cattle ranching
just so you know there's about 100
billion Acres on Earth 70 billion acres
are water 30 billion acres are land of
that 30 billion Acres 15 billion are
where we grow stuff 3 billion is crops
12 billion is animals so we have like a
lot of Ranch Land a lot of pasture land
on Earth where we have animals grazing
so this is a big industry in the US too
we have a lot of ranches in the US a lot
of people make a lot of money growing
cows in in rangeland in ranchland and so
there's a big industry a big Lobby that
would be threatened by this new
technology so they showed up to Governor
desantis's signing ceremony like the
ranching industry and they were all
happy and he was like we're protecting
the ranchers we're saving the industry
and they styed the adoption of this you
know what people called lab grown meat
but you know it's basically grown in a
fermentor tank meat that you could
otherwise buy elsewhere because the FDA
has approved it it's legal it's been
regulated it's been tested all this
stuff and the santis like basically
stood up and said we're doing regulatory
capture you know forget the tech
companies forget the that it could save
people money because now meat can be
cheaper consumers can have a choice they
don't have to buy this stuff they think
it's junk they think it's disgusting
they think it's evil they don't have to
buy it they could still buy beef so why
sty The Innovation well because the
ranchers are there and they're saying we
got to protect our industry this is
classic regulatory capture classic
cronyism and so it's enabled by a fear
of the technology it's enabled by the
fact that they're editing cells and
putting them in in Vats and lab grown
meat and we don't want that putri stuff
growing in our in our and the santis put
out like a picture of like one of the
tanks that grows the meat and then he's
like look at how they're growing this
it's disgusting and then someone else
put out a picture of the exact same tank
which is making beer that we all drink
or like making cheese or making yogurt
or like all the other stuff that we eat
it's the same tank um anyway so that's
what's going on right now and it is
you're exactly right it is sweeping the
nation there is a fear and a concern
about the technology that allows and
enables the regulatory capture and the
lack of innovation and progress and if
we could make the of food 50% Cheaper by
allowing this technology to proliferate
and it worked and people liked it and
they were willing to buy it then the
market will work and if the product
sucks and it doesn't taste good or it's
more unhealthy for you or all the other
things that are bad consumers will not
buy it and they'll stick with beef but
now they're stopping the market from
even being able to discover itself um
and so regulatory capture is underway in
this system that um feels really
unfortunate to me and everyone in Tech
even I'm a vegetarian so like I'm not
going to buy any stuff anyway so I don't
care um from a consumer perspective you
wouldn't need it even if it was I have
no interest I have no desire because it
doesn't appeal to me I don't know it's
like they is tasty Dave yeah I've never
had it it's crazy it's crazy the first
time I heard you say that I was like I
must have misheard that yeah I was
raised vegetarian so it's weird um like
and so yeah I I don't know but maybe
I'll try it for sure um but it's not
like something I desire right um but I
could see a lot of um people saying I
just like beef why mess with it so it's
okay to let this regulatory cap but as
soon as you let that happen it's like
freedom of speech as soon as you let it
happen you allow it to happen everywhere
that people can do regulatory capture
but you should let the market figure it
out let consumers try it let people see
if it's good let people see if they can
I these guys can't even make this stuff
cheap enough today it's like 100 bucks
versus three bucks they got to get this
thing super cheap before it even works
so we got to like let this thing get
tested anyway so that's a sort of
example of where stuff can get shut off
then California passed an AI bill to
regulate AI there's like 26
billion flops I don't know how they
Define this thing on like the models
need to be approved and reported so if
you write software that's over a certain
size you have to report to the
government
now so we see a lot of this sort of um
to your point kind of popups of like
concern are we really like preventing
the progress in The Innovation that will
help address the economic issue and
benefit people I mean imagine all the
people that can't afford to eat beef
every day I mean remember like in China
there's a billion people living on less
than 6,000 bucks a year and now they're
making 30,000 bucks a year it's
incredible wow in 30 years they've had
that transformation and they used to eat
meat one meal a week on average now they
eat meat five meals a week so there's a
luxury that has you know kind of arisen
but think about all the people that can
access that meat but if you can make
lower cost meat and you don't because
you don't need to grow the animal and
grow all the feed and use all the land
everything the cost can come down
because you're growing it in a you know
in a fermentor tank there might be a
pretty good market for this it could
help a lot of people get access to stuff
that they want and progress so again
it's great for the rich people in
America and the Floridians that want to
support the ranching industry but you
know these businesses aren't these
businesses are mostly going to benefit
other people um like other Technologies
too well we now at least have a way to
get out of some of the regulatory
capture we have a way to avoid some of
the censorship and Mal information
misinformation all that stuff let the
market decide as you said with
Independent Media podcasting which you
are a part of with the all-in podcast
and so uh I I do have to know there was
one point so I I'm an avid listener of
the Allin podcast but there was a point
where you and Jason it seemed like had
so much beef do you guys actually
considered ending the podcast are you
talking about this morning oh no did Mo
kick off what is happening David
freeberg it's
what's the beef between the two of you
um like I I I I kind of never was like
trying to be on a podcast so this was
not like something I set out to do my
friends were trying to do a podcast
Jason and chamath and then they invited
me to talk about Co at the beginning and
I said sure I'll talk about it on your
new podcast on YouTube or whatever and
then it became like the four of us with
saxs joining and there have every week
for years I've questioned should I keep
doing this for various reasons because
it's not a motivating it's not
motivational for me to like go put
myself out there and do this sort of
thing um so that wasn't something I
wanted to do and then so then when I run
into conflict or disagreement on how we
should do things or let's just make sure
we're doing the right thing by my
standards or by my point of view which
might be just a different point of view
uh I get frustrated I'm like it's not
worth it for me because I never really
wanted to do it so it's easy for me to
kind of say let's get out of here but
yeah I mean look um Jason's obviously
one of my Bes is one of my good friends
and we butt heads a lot I really care
deeply about some things that he wants
to be involved in and uh that's caused a
lot of conflict on various things like
our Summit and our show and so on um but
we kept at it I I get a lot of benefit
when I hear people on the street say
that I said something that
inspired a change in their
life um and when I hear that it makes me
say okay it's it you know it's worth
doing it like I really believe that to
your point earlier people have this
ability to control their own destiny and
they have to put the effort out and they
can change their lives and there's um
people have to build equity in
themselves was the comment I had made on
this one show which means make sure that
everything you're doing is increasing
your leverage next year you get more for
Less next year which means you can do
more and progress your life versus just
being in a service business or doing a
service where you do the same thing over
and over again but there's no
progression there's no equity there's no
new skills there's no new training
there's no leverage there's no value
that's being created as you do that and
it's a really important point that I
think people need to take into account
in thinking about their careers and
their career decisions and I had made
this comment offand at one of the shows
and there was this guy who I saw who
told me to change his life and he went
out and did a like real estate class and
you know started kind of changing like
what he was doing I said that's the
reason I do the show like so no people
are in the grips of ideas there's no
doubt now you guys have started playing
around in politics do you worry about
that at all yeah I don't like the
politics because you've heard my point
of view today I feel like it's a false
Choice like when I look at the
candidates for president for example
it's a false Choice like I'm not sure I
hear either person saying the thing that
I think I need to hear which is we got
33 trillion of debt and we're running a
$3 trillion annual deficit what are we
going to do that's the number one thing
we have to figure out before we talk
about all the 50 other things that
everyone cares about because otherwise
there is no ability to do all the other
things so for me um and then I think
like so much of the machinations are
just like so boring like it's just
gossipy like oh I don't care about so
and so yeah they all have good Sons they
all have bad Sons they all go into
prison I get it like you know it's like
one
guy the whole it's just it's not as
interesting to me I care much more about
like the bigger picture stuff and so
when we get into the details on who said
what at what trial it's like I I kind of
tune out but you are right I get a lot
of calls and a lot of emails from
Friends being like are you're
associating yourself with Trump
supporters now what is wrong with you um
this kind of blanket
Association um problem where people are
like oh you're friends with that person
they're throwing a fundraiser for Trump
why are you still on that show why are
you platforming
Trump and my friends are my friends like
they can they're interested in politics
they're giving money to this guy they
also gave money to Democrats they also
gave money to other candidates in the
Republican party like I don't I'm not
judging them I don't care what they do
at their time if they want to talk about
it we'll talk about it I won't have much
to say because I don't think there's
much inside I can provide or much
analysis I can do so that's it but I do
get a lot of this like and it actually
makes me say to people like why do you
care who I'm friends with like you know
I haven't expressed have I expressed
something that that you disagree with if
I've expressed something you disagree
with we should talk about what I said
that you disagree with but you shouldn't
immediately associate my opinions with
the actions that a friend of mine took
pretty messed up and it shows me a lot
about how people think now like I'm only
going to hang out with people that think
like me or talk like me I don't have any
interest in engaging in discourse with
people that think differently than me
and I think that's wrong I think we got
to be like fully engaged and fully
conversational with all aspects of the
discourse
on these matters that are important
agreed and apparently they don't want
you to associate with people that think
differently than you do so even once
removed people have a beef which is uh
pretty crazy do you guys think part of
the magic of the show is that you don't
always agree yeah yeah I've definitely
heard that that like a lot of people say
in comments and stuff we get comments
like it's great to see people have civil
discourse where we don't go to the
attack of the other person sometimes
we might make that mistake because it's
human nature but like if you think about
media the feedback loop is say something
controversial and activating like the
consumer the viewer is activated I said
something like screw you Joe Biden's
dying look at him he's a dead corpse
weekend at Beres I attack the guy that's
activating to someone that agrees with
me so then they tune in more and then
the viewership goes up and so then you
say that again you say more stuff and so
media has this like interesting
evolutionary curve where the feedback
loop that drives the limic system
response in the viewer you know ends up
dominating the media I mean rert Murdoch
learned this early on where he had that
gossip trade rag in London you know and
it was it was normally I think it was
originally like just general news and
then he started doing more of the
celebrity gossip and then he sold more
and he sold more and people like
activated by it they're like oh this is
this is so titillating I'm so into it
and then he sold a ton and then he just
kept doing more of it um and so there is
this aspect I think that we need to kind
of be cognizant of that you allow the
discourse to happen where you don't just
attack the other person or attack the
Target and you dialogue about the facts
this goes back to my point about like
Enlightenment like what does the
empiricism what does the data show us
what's the analysis we can do on that
data as opposed to the ignore the data
talk bad about the person get everyone
excited and now we all agree that
person's bad but we didn't actually talk
about any of the data so like I'm a big
believer like we should be talking about
the facts of the matter and like
debating around that both sides like
both sides should spend an hour on a
debate stage talking about how we going
to resolve this fiscal deficit and debt
problem and if you don't think it's a
problem then tell us why articulate why
how do you think through a problem so
obviously you're starting with facts but
like how do you build up are you
building up towards a moral conclusion
how do you think about that I don't know
how to General I mean I'm I'm a first
principles thinker so I try to be uh and
when you say that do you mean you start
literally at physics so if someone says
like
like we we recently had
this thing at my company we're trying to
build a greenhouse or build a lab
building next to our greenhouse and we
got to get all this stuff done and we
got six weeks to do it and everyone's
like well the GC says it takes three
months four months five months and I'm
like well why you got to always ask why
and then when you get their assumptions
like the assumption is the GC knows like
they're the source of Truth turns out
the general contractor is not the source
of Truth general contractor does things
their way so when you get into it it's
like well they work six hour shifts they
work five days a week I'm like well
let's pay someone to work 20 hours a day
seven days a week okay well now it works
because the source of Truth was not that
general contractor we need a generator
the electrical guy says it costs 180
Grand I'm giving you exact examples of
stuff that's happen my team's going to
kill me for this but I was like why do
we need I just went on the website and I
found a Home Depot generator for 8 Grand
why am I spending hundred some thousand
like because the electrical guy said it
that's how it cost I'm like well you you
guys know what the amperage is you know
like we need a three-phase generator
here's one that will be delivered in 10
days we don't need the electric well why
does he say that well he gives a service
guarantee like well do we need that
let's ask that question well it turns
out we could save hundred some thousand
dollars and if we need the service it'll
cost us a lot less than 100 Grand okay
yeah we should probably switch to that
and so I'm just giving you some examples
of always asking why and getting to the
source of Truth the the lot of people
talk about elon's definition of like
first principles which is physics
because physics are the fundamental
source of Truth like you eventually go
all the way back there but when you ask
people why enough times you end up
getting to the the ground fact the
ground truth that you can then build
from to make the right decision or come
up with the right solution for a problem
so that's often how I like to think
about these things you know people have
a Shand for example like we need to run
plant breeding cycles for one of our
crops and they're like well it'll take 3
years before we'll be commercial and I'm
like you're just using the approximation
because that's the way everyone in the
industry does it they take three years
to do it let's figure out what they're
doing and what we could do differently
to get it done as fast as possible okay
we can get it done in 12 months when you
break the problem down to every step in
the process that's needed rather than
use the shorthand approximation that the
way other people do it is the source of
Truth and we say let's figure out what
are the steps we can come up with a new
way of doing things with shortened
timelines 24 hours Cycles etc etc
suddenly we can get it done in a third
of the time so for me first principle
thinking is all about asking why and
getting to the source of Truth what are
the absolute facts the data that you
know is true and then building the
answer or the solution from there I
think that's really smart I tell people
that one you're trying to map base
assumptions so there's some base
assumption that's driving that you need
this uh generator and of course you're
going to want the service contract so
they just pencil it in uh but to your
point when you actually understand how
things work and if you can get to the
essence of the thing that becomes really
important that's right so that's why I
tell people look you're you're not going
to spend your time actually thinking up
from physics but that really is the game
you're playing and so if you ask can
this be done in six weeks if it doesn't
violate the laws of physics it is
possible now you may not have the skills
the talent or the desire to do the
things that you would need to do in
order to get it done but at least you'll
know what the real problem Oh the real
problem is we're up against the
generator we're up against that
contractor is not available for a month
or whatever and so okay now I actually
know the problem set and once I know the
real problem set then I can solve the
problem yeah but so often people just
they're reactive to the thing that
they're given instead of understanding
its nature and then figuring out where
we go all right I want to know the
besties ranked in order of poker ability
what do you got for
me sax doesn't play very much I gotta be
honest he's been like pretty absent from
our poker game game and chat's game has
changed a lot in the last year year and
a half he's been changing up his game
for better or
worse
um I think he's just grinding out more
like he's he's more like careful and
consistent he was very like over the top
aggressive kept pushing the envelope
back in the day like um I told him this
I said his games changed a lot but he's
also been training with a with a he's
been he's been practicing and doing work
on game I know that he shared that so
he's doing he's doing well and jcal is
kind of like a little knit like you know
knit means that he sits around and waits
for the right thing and then he takes it
and he doesn't bet anymore he kind of
just goes home with his money I give him
[ __ ] about that so you can give me
credit for that and I'm I'm probably not
too dissimilar I don't play enough I
think this year I haven't played very
much this
year um so I'm not giving you a great
answer everyone's different sax is just
Mia so I wouldn't even rank him anymore
uh I don't even know the last time he
played he's too busy electing the next
US president
um so yeah I mean I you know if I were
the one of the problems with the game
also is there's a lot of like Randomness
that comes into our game with our other
players so we get the the game changes a
lot depending on who's in the game
sometimes we get these crazy aggressive
players who are friends of ours who just
don't care about how much they're
winning or losing and they'll go as
aggressive over the top as they can
sometimes it's a smaller game more
careful and strategic people are tired
so G the game style matters some of us
perform different better in different
game styles like Chim does well in the
big games I don't play the big game the
big over the top games like shth knows
how to play those games better than I do
and I'm much better in the more like
normalized like strategic like where you
where you can do a better
job game theing like where people are at
like theorizing where people are at so
all right the political answer Mr
fredberg yes right where can people
follow you this has been incredible I
don't post much I I have a Twitter
account a Twitter handle freedberg
that's it yeah and the all-in podcast
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subscribe and click the notifications
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Subscribe button then I'll know you
really you really made it I think we're
we said we're going to do a party I
don't know if we've announced where yet
um but it'll be in Vegas so we're going
to do a party in Vegas when we get to a
million Subs which was a goal for us but
we realized recently we should probably
set that goal and oh 100% you're the
people that follow your show will love
it yeah so we're going to do a big party
it' be fun I like it I look forward to
it all right everybody if you haven't
already be sure to subscribe and until
next time my friends be legendary take
care peace thank you if you like this
conversation check out this episode to
learn more so we've gotten over our skis
on debt uh the FED is going to try to
print their way out of this all that
does is create inflation they try to
break the back of inflation with high
interest rates but so many people got
themselves into debt in