[00:00:00] Speaker A: There isn't a single goddamn thing that bitcoin can do for retail that Apple Pay doesn't already do. 10x better. A Bitcoin critic on Twitter 2019.
I can't use Apple Pay, PayPal, Visa or Master or anything like them. I'm from Iran. I can use Bitcoin. What do you have to say?
Zaya Sadir, Iranian human rights activist, subsequently jailed for freedom advocacy. Recently released. The critic issued a public apology.
The best in Bitcoin made Audible.
[00:00:34] Speaker B: I am Guy Swan and this is Bitcoin Audible.
What is up, guys? Welcome back to Bitcoin Audible. I am Guy Swan, the guy who.
[00:01:00] Speaker A: Has read more about bitcoin than anybody else you know.
And we are back around. The Stone Ridge Investment letter for 2025.
[00:01:11] Speaker B: Has just
[email protected] I always get tagged in this one like a hundred times and sent private messages. Dude, you see that? Stone Rich. You gotta read the Stone Rich, man. And I got to say, I always get excited about it. Ross Stevens always has a way with words. And I find the company fascinating, particularly because it comes from an area of business like a.
It's a kind of business that I would have no other connection to in the sense that I have no, like reinsurance. You know, I didn't even. I honestly couldn't even have told you what that meant before I started reading the Stone Ridge Investment Letter. And it is also something that I don't really have any professional interest in, but I am always fascinated by how he runs his business, how they think about the company, how they have built. You know, I always think, I really think of a business as kind of like a ship.
[00:02:08] Speaker A: It is a mission to accomplish something with a culture, with a way of.
[00:02:14] Speaker B: Setting up and treating other people.
[00:02:17] Speaker A: And good ideas, great ideas can literally.
[00:02:20] Speaker B: Fail because of a bad business and a bad culture. And not even that great ideas can succeed or find their way to success because they have a brilliant culture and they.
[00:02:32] Speaker A: They know what the mission is.
[00:02:34] Speaker B: Sorry, I bet that's getting picked up. That's. I'm getting a phone call. But I always just get into the stoneridge Investment Letter and it fascinates me how much I enjoy it.
[00:02:44] Speaker A: And he's.
[00:02:44] Speaker B: I've always felt Ross was a really good storyteller as well.
[00:02:48] Speaker A: And this one does not disappoint.
[00:02:50] Speaker B: And the section about bitcoin in the middle is also really awesome too, which is funny because I just realized I almost.
[00:02:56] Speaker A: I don't even think I brought it.
[00:02:57] Speaker B: Up in the commentary after. It was really just about his framing and philosophy and everything else in the, in the letter. But regardless, I'm going to have a. At least I'm trying to get somebody on the show to have an episode about Venezuela and everything that's going on over there because that is brought up during.
In that section of the. Of the piece. Real quick, I just want to shout out our sponsors. We've got Leaden IO for bitcoin backed loans. They've been an indispensable resource for me and they are an incredibly useful tool in the Bitcoiner toolkit.
[00:03:32] Speaker A: I've got a link in the show.
[00:03:33] Speaker B: Notes for you with a discount.
[00:03:35] Speaker A: And speaking of discounts, I got 10%.
[00:03:37] Speaker B: Off get chroma for light health. Not only red light therapy and blue and green light blocking glasses, but also daylight lights that do not have the horrible spike of most artificial lights that.
[00:03:52] Speaker A: Can cause so many problems. If you haven't gone down this rabbit.
[00:03:55] Speaker B: Hole, I highly encourage you to do so. Um, it's very fascinating and I obviously have a 10% discount with code Bitcoin audible, um, shout out to synonym and pubkey Pubkey app.
[00:04:07] Speaker A: The link will be down in the.
[00:04:08] Speaker B: Show notes obviously but this is a kind of a showcase of what you.
[00:04:14] Speaker A: Can do with a protocol that they.
[00:04:15] Speaker B: Have built to re decentralize the web. This is for builders and vibe coders are builders now. So all you need is an AI account and or a really good GPU that can run a local model and.
[00:04:28] Speaker A: You are a builder and it couldn't.
[00:04:29] Speaker B: Be easier than having someone who has.
[00:04:31] Speaker A: Built a protocol for you to do all of the hard stuff and building.
[00:04:35] Speaker B: Something on top of it.
[00:04:36] Speaker A: It is a must explore if you.
[00:04:37] Speaker B: Are trying to build unstoppable software and.
[00:04:41] Speaker A: Fix the problems of the web.
[00:04:43] Speaker B: And lastly the insane like the incredible work that the HRF has done. And honestly I couldn't give a shout out that was better than what Ross.
[00:04:52] Speaker A: Stevens did in this letter.
[00:04:54] Speaker B: So pay attention when that point comes up and don't forget to check out the Oslo Freedom Forum tickets are on sale as well as the financial Freedom report that they put out every week. Links and details are right in the show notes and actually just checking them out and using my links is actually a really great way to help the show.
[00:05:13] Speaker A: So thank you for those who do with that. We shall delay no longer. It is time to get into today's read and it's titled the Stoneridge 2025 Investor Letter written by Ross Stevens.
Every driver has a limit. Mine is a little bit further than others.
Ayrton Senna Greatest Formula One driver of all time.
I'm not funny. What I am is brave.
Lucille Ball, Greatest female comedian scratch comedian of all time.
I'd rather be optimistic and wrong than pessimistic and right.
Elon Musk I can out learn you, I can outread you, I can out think you, and I can out philosophize you.
Robert De Niro as Max Cady from Cape Fear I'm not superstitious, but I am a littlestitious.
Michael Scott the Office on how Bayesians form priors A wall is a very big weapon.
Banksy December 2025 Dear fellow investors, the greatest treasure hunters know that the treasure they seek is not lost.
It is waiting.
Starting in 1969 and for 5,954 straight days, Treasure hunter Mel Fisher sought what was waiting for him the wreckage of the Nuestra Senora de Atocha, a Spanish galleon that sunk in 1622.
How do you recruit, retain and motivate a crew when you are not sure when you will find the treasure, if you will find the treasure, or what the treasure will be worth?
Fisher developed a powerful operating philosophy, captured in its entirety with three amazing Today's the Day.
Every morning for 16 years, Mel Fisher banged pots and pans in the pre sunrise to rouse his crew, shouting and smiling.
Today's the day, men. Today's the day.
Eventually, it was true. On July 20, 1985, Mel and his crew discovered the most valuable shipwreck in history.
70 miles off the coast of Key west, the Atocha yielded gold and silver, today worth more than $10 billion.
Fisher's Today's the day philosophy reframed what would have otherwise been a mentally torturous journey.
Will we ever find the treasure? Is it even here?
Into daily play, characterized by disciplined guessing, dispassionate refinement, and the singular goal of ending the day less wrong.
Fisher had never studied or even heard of Bayesian statistics. Yet as we will see, his operating philosophy and its daily ritual of iteration was textbook Bayesian.
Fisher also settled for me a foundationally important debate I had struggled with about the philosophy of probability theory, which in turn provided me with an operating manual for leadership.
Arriving at the University of Chicago's PhD program in 1991, I, like Fisher, had never studied or even heard of Bayesian statistics. Yet exposure the first day of my first class turned into a wandering, wondering, and still unabated obsession. I left the program five years later with a PhD in Bayesian Statistics and.
[00:09:06] Speaker B: Finance, and my career has essentially been.
[00:09:08] Speaker A: A three decade extension of what I learned at Chicago. I now do Bayesian treasure hunting for a living.
Today's the day.
Fancy math aside, the foundational idea of Bayesian statistics is simply learning from experience.
Things get started with a prior distribution, which is what you think you know about what you want to know. For example, where is the treasure? That prior is mixed with observable data experience to form a posterior distribution, a structured mashup of your prior and the data you collected. The posterior represents your new view of what you want to know. For example, I now know the treasure is not over there.
The power of Bayesian statistics is in the trade off inherent in the framework. How much do you listen to your pre wisdom intuition before it is enhanced by the data you collect? Knowing your pre data knowledge is limited at best.
How much do you listen to your new data, especially if it contradicts your pre data intuition? Knowing your limited sample may not lead you closer to the treasure and might even throw you off the trail.
When done with mastery, Bayesian statistics is a beautiful, egoless daily practice of being less wrong.
In hindsight, every incoming University of Chicago PhD student in 1991, our collaborative little group of intellectually hungry sponges was susceptible to becoming a Bayesian. Arnold Zellner, a giant in the history of Bayesian econometrics, towered gently over the business school statistics department, having just been named president of the American Statistical association and to me a hilarious, wonderful, deeply caring professor, and through my own research was and still is focused on empirical asset pricing. My six man dissertation committee ended up including four Bayesian statisticians, even a legend in the field.
I recall as if it were yesterday, my dissertation co chairman Rob McCulloch teaching me that the Bayesian required question how do we set our priors? Illuminated a philosophical debate still raging about probability theory. Because that simple question is akin to asking what can we know prior to knowing? I thought about that deeply for years studying Fisher and treasure hunting. I now know what the answer is. Often a lot.
What's an expert anyway? Just some guy from out of town.
Mark Twain Consider that Fisher knew to search off the coast of Florida and not say, Australia.
How? During his pre search research at the Archivo General de Indias in Seville, Fisher discovered a fated 1622 salvage account describing the treasure fleet's loss and references to survivors setting up camp in Cayos del Marquez or Key Largo today.
So Fisher's prior variance was very large to start search the Florida Keys, but not practically infinite search all 140 million square miles of water on the surface of the planet, knowing roughly where the atocha sank and roughly the seasonal path of the current, that is, Knowing prior to knowing scratch. Before collecting any data from the sea, Fisher literally and massively shrunk the problem.
Bayesian shrinkage, a foundational element of Bayesian statistics, involves pulling in especially noisy estimatessay all oceans on Earth closer to a central value, say, water off the coast of Florida. My dissertation, which applied new computational techniques in Bayesian shrinkage to old problems in finance, helped me see Fisher as a Bayesian.
Every day, Fisher, like any good Bayesian, updated his prior guess of where the atocha was with data about where it definitely was not.
Every day, Fischer became a little less wrong in finding the Atocha in 16 years and not 60 or never, Fisher adhered to Bayesian adjacent principles that Alec Litowitz, founder of Magnetar Capital and my former boss and mentor, writes about in his forthcoming and fascinating field guide for success.
The Adaptability Rewiring your mind for success in the next human era Confirmation bias is the worst enemy of iteration in a Bayesian system. It's fatal if you only accept the data that supports your hypothesis. You're not updating, you're entrenching. The people who learn fastest are the ones who are most willing to be wrong. With the humility to trade conviction for information one update at a time, Fisher let the data speak and learned fast. In 1973, he found silver bars and coins matching the atocha's manifest less wrong. Two years later, he discovered bronze cannons with atocha markings even less wrong.
Ten years after that, the motherlode absolutely right.
As students of the great Chicago Bayesians, we at Stone Ridge seek continual improvement in the speed of unbiased iterations.
We are trained to privately ask ourselves, was I less wrong? Today, our progress depends on our eruptions of good questions and truly listening to the answers. We would rather look dumb by asking than not ask and be dumb. People forget if you looked dumb. They do not if you are.
As students of the great Bayesian Fisher, we at Stone Ridge know that success is not always linked to intelligence, boldness, or experience, but does consistently follow those most adaptive.
In Litowitz speak, it is not just IQ or EQ that matters, but AQ adaptability quotient, a way of thinking that prioritizes learning over being right and structure over rigidity. When the terrain shifts, do you update or insist?
Updating our prior Chicago with our data, Fisher allows us to graduate with an extraordinarily valuable posterior because it contains X marks the spot. Wisdom markets overpay for stories of the future and underpay for hidden treasures of the past.
That single Chicago Fisherian insight caused US to make $3 billion in uncorrelated trading profits this year and $10 billion the last three.
To see how, let's go Bayesian Treasure hunting and discover what awaits us buried in old reassurance balance sheets in ancient Arkansas rock.
Optimistic and wrong? Scratch that, right?
In 2023, amidst intense diligence for what ultimately became a $3 billion purchase in Arkansas Fayetteville Shale, we noticed that of the 860,000 acres included in the deal, 800,000 were covered with PDPs and 60,000 all adjacent were covered with grass. That's a lot of undeveloped land.
Why are there no drilling rigs here?
We decided to park our one major unanswered diligence question for the sake of efficiency.
Once convinced our PDP only purchase could deliver our target returns two years later, after taking over operations of the 5,596 wells we purchased and our internally reframed responsibility of powering the homes of 4 million American families, the question why are there no rigs here?
This time we could not shake it. We learned that no one had drilled anything new for almost a decade.
Odd for a basin that size. A little stitious? We wondered, does treasure await?
We suspected the previous owner's denominator problem could explain their lack of drilling. They were an enormous company.
Any marginal improvements in Fayetteville, despite being potentially large in dollar terms, would likely not move the needle in roe. Their North Star, in contrast, Stoneridge operates every day with a no basis point left behind mindset. One basis point is our North Star, and to us, large dollars will always be large dollars.
We also learned that two important aspects of drilling changed in the past technology and cost completion. The act of getting a drilled well to the point that gas steadily comes out of the ground for commercial purposes now benefits from better drills, smarter rigs, more powerful fleets, and advanced digital control systems. And following a version of Moore's Law, the new and better technology continually costs a lot less.
We decided to run a tightly controlled test program on our undeveloped land, drilling new wells, seeking fast, unbiased iterations, and updating and hopefully tightening the variants of our Bayesian prior every day.
Was there untapped gas under our 60,000 acres of grass? If so, where? If so, how much?
Our approach was surgical two pads, five wells, disciplined design, unbiased data analysis, and adherence to the following mathematical identity.
Drilling for natural gas is equivalent to searching for buried treasure in ancient rock.
Though we did not shout today's the day. Every morning during our Fayetteville testing, we did feel fisher like energy as our ignorance shrank. Less wrong. Even less wrong. Absolutely right.
Eureka. We found fisher like treasure composed of oil and gas, not gold and silver. Our no less precious motherlode means that the $10 billion lifetime revenue we originally expected in Fayetteville now looks more like 15 billion.
Discovering half an atocha caused us to immediately shrink our priors in all seven US Basins. We operate a technical Bayesian statistical concept called burrowing strength.
Our philosophy of probability theory, concretely applied to our Fayetteville test results, allowed us, with powerful practical efficiency, to know without knowing in the not yet tested basins.
Less wrong.
We are now in the process of learning as much as is known about drilling before tapping our AQ to push the limit a little further than others and get closer to what is knowable. Every day counts because there's gold, scratch oil and gas in them thar hills. It is waiting.
It may seem difficult at first, but all things are difficult at first.
Miyamoto Musashi the Book of Five Rings in launching our energy franchise almost five years ago, we assumed our breakthroughs in.
[00:20:55] Speaker B: Proprietary financing and hedging technology and the.
[00:20:57] Speaker A: Resulting material edge in our cost of funds were sufficient conditions for best in class investment performance.
We quickly and painfully learned, however, that financial sophistication cannot substitute for industrial control in energy markets. Physics, not finance, sets the tuition entrepreneurs must pay a bit. Chastened, we updated our prior and then fortuitously met Flywheel Energy, by far the best operators in the industry, due in part to their entire executive team's roots in elite military operations, Flywheel is now part of Stoneridge.
Under Flywheel's peerless leadership and an unbeatable team of 794 superstars, including 569 in the field. We now operate our wells ourselves, with every colleague crisply aligned on and unambiguously individually responsible for their specific part, maximizing a singular metric, total dollars of operating profit. Physics and finance are now in sync. Industry leading results have followed. Since inception, Stone Ridge Energy, or SRE, has purchased almost $11 billion of energy assets, all via proprietary securitizations. No bankers, no information leakage, no fee leakage. Over that period, spot natural gas has traveled in a staggeringly wide and volatile range from $1.50 mmbtu to almost $9 mmbtu. Yet across 13 equity tranches, the integrated precision of Flywheel Physics and Stone Ridge Finance has produced greater than 20% per year with low volatility and no correlation to anything.
Never was a finer canvas presented to work on than our countrymen. All of them engaged in the pursuits of honest industry, independent in their circumstances, enlightened as to their rights and firm in their habits of order.
Thomas Jefferson in a letter to James Madison, 1796 the US shale revolution required three actors working in concert. First, unlimited underground supply of hydrocarbons. Second, technological breakthroughs to access it. Third, profit seeking capital leveraging nature. For the first part, SRE brings fresh thinking to the rest.
Play the tape forward five years and I do not see SRE as a larger version of what we are today.
I see a different kind of company. SRE has a chance to matter in the same practical civic way that a major rail line or a modern port matters. I would like us to at our pace of disciplined acquisitions, careful development and unrelenting process improvement, SRE will be a top three US producer of hydrocarbons. Managing that level of capital and molecule movement at our extraordinary level of operational excellence would meaningfully impact U.S. families and U.S. factories and the competitiveness of this country. I would like us to more than 99% of the capital we manage at Stone Ridge, including SRE, comes from American investors. At our scale, that cannot happen by accident at Stone Ridge, American capital produces American treasure out philosophizing on average and over time. Treasure hunting in the sea is not a good business.
Availability bias blinds us to the fact that for every Mel Fisher dozens of others strike out. In fact, any too narrowly defined business is not a good business over a long enough time horizon. Meta and Abstract no Bayesian and practical when the terrain shifts and you insist your business surface area too is limited even for efficient Bayesian updating to help in Litowitz speak, your confirmation bias is fatal. It is just a matter of time.
Consider legacy reinsurance in contrast to prospective quota shares aligned partnership trades in which Stoneridge shares risk pro rata with leading reinsurers tapping into their masterful Bayesian updating cycle management skills across dozens of lines of business.
Legacy trades transfer retrospective risk from reinsurance policies written years or decades ago.
The performance of legacy only reinsurers is like that of lenders to two narrowly defined monoline credit originators think only subprime auto or only UK small business victims of confirmation biases. Siren song monolines always yes, always, always originate unprofitable loans at the wrong time in the cycle.
Beware lending to monolines when tight spreads persist, they insist health warning Beware investing in legacy only reinsurers. Confirmation bias dooms the business model and along the way guillotine level adverse selection hangs over every trade When a one off risk transfer price is highly attractive for clear and imperative strategic reasons. Hyper selective non legacy only investors can profitably escape with their heads. But at Stoneridge we know half priced sushi does not mean it's a bargain.
A decade ago there were about a dozen dedicated legacy firms in funds. Today one large player remains though recently its credibility detonated after initiating litigation against a client. The other remaining legacy only firms are subscale or regionally focused. Enter Long Tail Re Humble beginnings A clear vision Stonebridge began Long tail Re in 2020 focused on two simple ideas. One partner not compete with the world's best underwriters to generate a portfolio of hyper diversified casualty liabilities that deliver low cost float and two Invest that float in proprietary and valuable Stoneridge generated fixed income assets with superior risk adjusted expected return always open to Bayesian updating of.
[00:27:27] Speaker B: Its prior distribution scratch core business model.
[00:27:30] Speaker A: Of prospective quota shares. Long Tail Re's positioning has always been be available for new data and a reshaped posterior legacy transactions from motivated parties we know well and who call us but do not be in the legacy business.
Out of almost 100 legacy trade requests since inception, Longtail has written three 3.
A landmark transaction Long Tail executed one of those three in November, a record 1.4 billion retrospective reinsurance transaction with Everest Group, an S&P 500 company with whom Stoneridge has an excellent 13 year uninterrupted trading relationship. Everest had compelling corporate reasons to de risk and the transaction with us, albeit enormous in the legacy space was only one part of an even larger, clear and imperative strategic repositioning of their entire firm and of non negotiable importance to us. We know for many years. Like and trust Everest's new CEO.
The trade has an outstanding expected return profile and diversifies Long Tail's core prospective portfolio because it covers past underwriting years back to 2003. It was also the largest legacy trade of Long Tail CEO Mike Sapner's career and mine.
On their most recent earnings call, Everest CEO said I was really really glad that we were able to do this.
[00:29:03] Speaker B: Transaction with Longtail Re and Mike Sapnar.
[00:29:06] Speaker A: Those are super credible underwriters. They did an excellent job evaluating the portfolio. It got to economics that will be very very good for Long Tail Re. We agree.
As only Bayesian treasure hunting reinsurance geeks can we internally renamed the core trade of the legacy reinsurance industry a loss portfolio transfer or LPT to WPT waiting portfolio Treasure recall, I said. Geeks. And who wants losses?
Long Tail ends 2025 with more than $6 billion in assets, about 1/3 from WPT, up from 0 WPT 18 months ago.
Most important, Long Tail has delivered 20% annualized ROE since inception in 2020, 16% per year, higher than the average of the top three global reinsurers, our aspirational peer group. In the decades ahead, Long Tail may do its next legacy trade in two years or five. Or never. In recent pre search research, we discovered a fated 1622 salvage account in Seville, aka PwC's annual global insurance runoff survey, suggesting about $1 trillion of WPT may be out there somewhere, buried in old reinsurance balance sheets. Our Bayesian training tells us about 97 out of 100 legacy treasure hunts would be for fool's gold, but also that about $30 billion of real treasure awaits.
I'm betting on Long Tail's Bayesian treasure hunters to find it.
What you are is brave.
Just last year The Atlantic wrote 15 years into its existence, Bitcoin has yet to demonstrate any serious use case.
87% of humans today, though definitely no one who edits articles at the Atlantic, were born into a monetary system without a reserve currency and also without democracy, rule of law or property rights. Simply put, the way the Atlantic editors use money is not the way most people on earth use money whose savings technology is either collapsing paper notes, cattle or sheet metal. Seething with financial privilege, the Atlantic editors might debate the relative merits of saving an Nvidia versus Amazon. How about instead cattle versus sheet metal? If Bitcoin has no use case, perhaps the Atlantic editors should convert their entire life savings into Malawian Kwacha and see how it goes.
In 2023, Malawi, generally considered a democratic country, chose a 44% overnight currency devaluation and it's gone. If you don't hold Bitcoin, please step out of the line.
This line is for people who have money, not fiat scratch credit.
No one got to vote on the inhuman cruelty of almost having overnight the cumulative value of their entire life's work.
Instead, the criminal counterfeiters scratch central bank forced the Atlantic editors scratch 22 million humans to invest their life savings in unbacked pieces of paper with zero marginal production cost, turning them Ex post into 44% slaves.
Nothing produced limitlessly and for free can ever eventually have value.
Fiat is always and everywhere a Ponzi phenomenon with seignorage, the state's irresistibly silent Madoff like pitch bitcoin It's Kryptonite. Will never take the meeting.
Still no use case. Let's try another one.
[00:33:02] Speaker B: There isn't a single goddamn thing that.
[00:33:04] Speaker A: Bitcoin can do for retail that Apple Pay doesn't already do 10 times better.
The Atlantic editors scratch a Bitcoin critic on Twitter.
I can't use Apple Pay, PayPal, Visa Master or anything like them. I'm from Iran. I can use bitcoin. What do you have to say?
Zaya Sadir, Iranian human rights activist, subsequently jailed for freedom advocacy. Recently released the critic issued a public apology.
Still no use Case. Before we try a final one, a stoic parable about all can provide some context.
When we were very young, the world was an awe inspiring place. Watch a three year old watch her dad fill up a castle shaped bucket with wet sand at the beach. She is fascinated that her father would do such a thing. But when he inverts the bucket and carefully lifts it up, revealing a perfect sandcastle, the three year old is awestruck that such magic is possible and that her father has power to perform that magic. If we meet that 3 year old 10 years later, maybe she has 25%.
[00:34:10] Speaker B: Of the capacity for all she had.
[00:34:12] Speaker A: That day at the beach. And 10 years after that, her capacity for all might be down to 1% of its sandcastle level.
In one of the most moving days of my life on December 10th in Oslo, I got to attend the very intimate award ceremony for the Nobel Peace Prize. My battery capacity for all recharged to 100%.
Maria Corina Machado won for her decades long commitment to freedom, democracy and human dignity in Venezuela. In 2023, with more than 1/3 of her country's 30 million citizens having fled to survive the largest refugee population in the world, Machado decided to run for president against the brutal dictator Maduro. Her campaign the personification of ultimate bravery.
Traveling by road and dirt path across the country, with gasoline shortages, daily blackouts and collapsing communications, Machado risked her life just to campaign.
On July 28, 2024. Her supporters risked theirs just to vote. In a nationwide eruption of truth, Machado won in a landslide. The repressive Maduro regime ignored the results, clung to power illegally and forced Machado into hiding.
They tried to bury us. They didn't know we were seeds.
Venezuelan Proverb in late 2024, from a secret location, Machado was interviewed by the Human Rights Foundation's chief strategy officer, Ale Alex Gladstein, saying the world knows of.
[00:35:56] Speaker B: Chavez and Maduro's human rights abuses but.
[00:35:58] Speaker A: Less about their Violations of financial rights, turning a functional economy into a catastrophic financial crisis. In 2018, inflation reached 1.7 million percent. This financial repression, rooted in state sponsored looting, theft and money printing, happened despite our vast natural resources. Beyond wrecking the currency, the regime weaponized financial systems against its people, freezing accounts, seizing assets and cutting services. Venezuelans found a lifeline in Bitcoin during hyperinflation, using it to protect their wealth and to finance their escape. Today, Bitcoin bypasses government imposed exchange rates and thus helps many of our people. It has evolved from a humanitarian tool to a vital means of resistance. We are grateful for the lifeline Bitcoin provides and look forward to embracing it in a new democratic Venezuela. We envision Bitcoin becoming part of our national reserves, helping rebuild what the dictatorship stole. Before our gold reserves were plundered, Venezuela had wealthy financial reserves worldwide. We will restore those reserves and include Bitcoin as a key component. Unlike bank wires, which the regime blocks, Bitcoin donations cannot be seized. Let's use this technology to bring about the change Venezuela desperately needs. We are determined to assert our sovereignty and transform Venezuela into an open, prosperous and secure society. Something that is only possible in a free nation.
We await the Atlantic's public apology.
Upon news of her Nobel win, Machado began plotting her escape from hiding. She wanted to be in Oslo as a symbol for her people and the world. When it was time, Machado, in a wigged disguise and under the COVID of dark, left her jungle hiding spot, evaded multiple regime checkpoints, took a tiny fishing boat through treacherous waters and finally miraculously boarded a supporter's private plane to make it to Oslo. It would be impossible to overstate the danger Machado faced to escape. Almost immediately upon landing at 3:00am local time, after hugging her family or anyone for the first time since she had gone into hiding 16 months earlier, and in the same clothes, she began her now immensely historic day. Machado sat for an interview with BBC News.
I immediately noticed she sounded different.
Already the world's most inspirational living human rights activist. Some transcendent combination of her time in hiding, winning the Nobel and successful escape gave Machado's tone, timbre and bearing a Mandela like ascendance and regality. She spoke with extraordinary moral authority and absolute certainty about future events. Words coming through her with divine clarity. Machado, now destined to become among the greatest female scratch scratch leaders of all time.
Venezuela has turned into a nation in which the state applies terrorism. The regime has control of all institutions and has applied state terrorism towards innocent people and committed crimes against Humanity and everybody that dares to speak out to defend any of your basic rights takes a huge risk and probably ends in prison just for posting news about the Nobel Prize. You will get in prison and if they go looking for you and they don't find you in your house, they will take your family, even children, in prison. So they had to say that I am a terrorist, that I have to be in jail for the rest of my life, and they're looking for me. So certainly leaving Venezuela today in these circumstances is very, very dangerous. So I just want to say today that I'm here because many men and women risked their lives in order for me to arrive in Oslo. And I came here on behalf of them and the millions of anonymous Venezuelan heroes to receive the prize and to take it back to them, because it's theirs. I'm going back to Venezuela. The Venezuelan government would have disappeared me if they found me when I was in Venezuela. And I know exactly the risks I'm taking. And what I've said to the Venezuelan people from the beginning is I'm going to be in the place where I am more useful for our cause. And until very short time ago, the place where I thought I had to be was Venezuela. The place where I believe I have to be today on behalf of our cause is oslo.
In his 1978 essay, the Power of the Powerless, human rights activist Vaclav Havel, leader of The Velvet Revolution, first president of the post communist Czech Republic and HRF's first chairman, makes the searing point that though authoritarians can mobilize their heavy artillery of terror, torture, imprisonment and persecution, they are not equipped to fight the asymmetric battle between lies and truth.
Powered by Bitcoin, Machado channels her people's truth. Venezuela will soon be free. A human rights miracle worth celebrating to tears.
Venezuelan regime change can also be an asymmetric truth domino, the animating spark for revolutionary excitement, heroism and power among the powerless that then topples the other nearby dictators in Cuba and Nicaragua, that cumulative outcome would be of immense significance to America, and that possibility has been hugely motivational to me. For American global primacy to continue, which it must, this must be the Western Hemisphere's century.
No authoritarians allowed in the neighborhood. The majority of my personal philanthropy is anonymous, and it will stay that way. However, in the hope of inspiring followership at this moment of maximum human rights Gamma, I will share that I have long supported Alex Gladstein's work arming the only people dictators fear. Human rights activists with large quantities of satoshi's unstoppable truth telling weapon. Bitcoin is money dictators can't stop. I know firsthand its importance to hrf.
Asleep during Machado's BBC News interview, I left Oslo a few hours later, hustling back to New York to host the Stone Ridge Holiday party that evening. After landing, I saw and then listened to a voice note attached to an encrypted message. Mouth agape. I recognized the voice immediately with an ascendance and regality that moved me to tears by the end. Here is the message in full.
Dear Ross, this is Maria Corina. I want to thank you personally for your support of the Human Rights foundation and all the programs that have made possible this unique moment in Oslo this week. Because of your support I was able to move, to arrive where I needed to be and to continue to fight without interruption. You know, in moments like these, logistics are the whole difference between presence and absence. I arrived late and didn't have a chance to thank you in person as I wanted, or to tell you about the plans we have in the time to come. But I know that we will have a chance to do that very soon. I want you to know that your personal commitment to our struggle for freedom translates directly into action.
It gives our people and people like us the ability to stand where it matters and when it matters. So I am very, very grateful for your clarity of purpose, for your belief in freedom, and certainly for your willingness to stand for this freedom in both practice and principle. I will not cease in this struggle for freedom and I certainly look forward to welcoming you and hosting you and your family in our beautiful country and a free Venezuela. Thank you for making so much happen.
I look forward to seeing you and please take very good care.
Bitcoin has a use case human rights treasure a little further than others.
In 1984, Apple, then still Apple Computer, premiered a sci fi short film, a commercial at the super bowl in which a rebellious heroine smashes a screen symbolizing Apple breaking free from the conformity of IBM's Big Brother, widely considered the greatest commercial of all time for almost four decades, it established Apple's identity, paved the way for the Mac, and led to record sales in 2020. Also at the Super Bowl, Apple was dethroned. New York Life premiered an even better commercial, paving the way for the next chapter of its identity, also leading to record sales over the course of 60 emotional seconds. New York life began by briefly exploring three Greek words for Philia, storge, eros, to then focus on the fourth agape or love as an action this ad contained powerful scenes of care, including a 10 year old boy lifting his little brother over a country fence en route to an adventure. And a 50 year old son lowering his frail 95 year old father into a tub to help him bathe. The commercial anchored the firm's 175th anniversary branding of building better futures through love and financial security.
Here is the copy.
[00:45:00] Speaker C: The ancient Greeks had four words for love. The first is philia.
Philia is affection that grows from friendship.
Next, there's Storge, the kind you have for a grandparent or a brother.
[00:45:16] Speaker A: Let's go.
[00:45:19] Speaker C: Third, there's Eros, the uncontrollable urge to say I love you.
The fourth kind of love is different.
It's the most admirable. It's called agape love. As an action, guys, it's good. It takes courage, sacrifice, strength.
For 175 years we've been helping people act on their love so they can look back or look ahead and say we got it right.
We did good.
[00:46:00] Speaker A: Stoneridge takes immense pride in working for the policyholders of New York Life and also massmutual iconic American firms and our largest partners.
180 years old and 174 years old, respectively.
Mutuals are special.
They feel different inside. There is no conflict of interest between the shareholders and the policyholders. Because there are no shareholders, the policyholders own the firm. A wonderfully clarifying and palpable distinction.
Employees stay for decades and the top executives view themselves appropriately and inspirationally to me as leaders and stewards. My Stone Ridge colleagues and I run to work every day for New York Life and Massmutual. And we aspire for our little firm to be like those big guys when we grow up.
Since any company's longevity on a long enough timescale is entirely dependent on its ability to reinvent itself, the most under appreciated characteristic of these mutuals is their astonishing consistency of innovation. The typical firm in The S&P 500 is 58 years old, not 180.
No business can do tomorrow what it did yesterday and last very long, let alone do it in the next century what it did in the last.
Consider that these mutuals paid claims during the Civil War when, remember their core product is life insurance. Their policyholders were shooting each other. They paid claims after the 1906 San Francisco earthquake, decades before Hanover Requality earthquake seismologists could help them properly underwrite that risk. And they paid claims through the two global pandemics. Twice surviving life insurers, one true tail risk.
Extraordinary financial strength. Ironclad Reliable claims, payment and a monumentally underrated culture of innovation equals New York life and massmutual.
Watching these reinventing mutuals up close has also taught me that firms seeking longevity, including Stone Ridge, must just as importantly decide what must not change.
What is our air gapped mission? What are the rituals we dare not cease? What routines, the one that make us us, shall we pass to new colleagues? In essence, what are we stewards of?
In order to be irreplaceable, one must always be different.
Coco Chanel Revolutionary fashion designer At Stoneridge, we innovate to prepare for an uncertain future in pursuit of our mission. Financial security for all.
Our rituals are few, important and sacrosanct. Our routines drive our productivity. We work five days a week in office and have a no device policy in meetings. Routines that maximize exposure to the uncorrelated weirdness of our spectacular colleagues. Fiddling with a device in a meeting means you do not belong in that meeting. Meetings should be rare, riveting and short. Zero is the wrong number of meetings for a firm, but it is close. A meetingless firm with 100 employees has 4,950 potential one to one colleague collisions all day long. Remove 10% of the team for an unnecessary meeting and lose 945 potential collisions. That meeting math is especially punishing at Stone Ridge. Our people are our moat dug deeper per collision.
A lot of people never use their initiative because no one told them to.
Banksy.
Initiating collisions with insanely smart colleagues at Stoneridge can seem intimidating at first. But you must take the initiative to ever create a map in which X marks the spot. My advice to my colleagues is the same advice I give to my 18 and 23 year old boys.
Ask her out whether she is a hard class, a job, a city, a beautiful woman or a brilliant Stoneridge colleague. Just go up and talk and remember. Stone Ridge colleagues are insanely kind too.
At Stone Ridge, we care deeply about how we present ourselves to outsiders because we matter and so do they.
When introducing ourselves in meetings, we mention our role and how long we have been at the firm.
Hi, I'm Ross Stevens, the CEO and I've been at Stoneridge since 2012.
After meetings, we walk our guests to the elevator. Along the way, sincerely thanking them for the visit.
[00:50:43] Speaker B: Sometimes we even take the elevator down.
[00:50:45] Speaker A: With them so we can thank them some more. Finally, business cards are back. Business cards remind us we live in a tactile world and our most tactile experiences are with other humans. Business cards also symbolize something of value.
You.
Our simple meeting routines Honor ourselves and our firm and show proper respect to our visitors.
Your work is going to fill a large part of your life. And the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do.
Steve Jobs over the last 36 months, three Stoneridge colleagues voluntarily left to work at another firm.
Each was junior in their career and had a 10 month average tenure with us. Clearly, Stoneridge was not for them.
We in turn reflected on what happened in each instance and refined our recruiting process, uninterested in transients and any element of our life's work.
Though Stoneridge achieved, with plenty of room to spare, my singular KPI, less than 1% per year, voluntary turnover. Those three departures were exactly three too many to me.
I intend to raise my game in 2026, so please tune in same bat time, same bat channel to see if I had a better year.
I need someone to protect me from all the measures they take in order to protect me. Banksy despite the three levers, Stoneridge got something very important, very right. At firm inception, no hr.
No HR is the gift that keeps on giving. Because the very best people are repelled by those addicted to comfort.
When new folks arrive at Stone Ridge.
[00:52:31] Speaker B: And realize we have no hr, a.
[00:52:33] Speaker A: Lens cap lifts off their consciousness. Surrounded by elite intellectual athletes, they immediately begin their training to be one, feeling compelled to do remarkable things, utterly untethered to what they previously thought possible. We teach them business physics, but also to feel bound by nothing. I would not dare limit their leaps even one inch with even one minute of an infantilizing HR training session.
He is no longer a dreamer. He is a creator.
Sculptor August Roden describing his masterpiece the Thinker.
One of my favorite untethered Stone Ridge policies is unlimited maternity leave, which has been true since the Firm began. I think of Agape. It takes care and action to properly delegate your duties to your remaining colleagues. While you enjoy that magical time with your family in action and a bit of love, your colleagues lock arms and step up for you so the firm does not miss a beat in your absence. The duration of which I refuse to meet her. It also takes action and a bit of love to take no action.
The awesome women of Stone Ridge know their job will be waiting for them.
[00:53:44] Speaker B: When they get back.
[00:53:45] Speaker A: I sometimes wonder if that ever helps them decide to create more treasure.
It is fun to have fun, but you have to know how philosopher the Cat on his approach to work in his masterpiece the Cat in the Hat at Stoneridge we relentlessly focus on growing after tax cash flow to drive durable equity value in our operating businesses. Our progress has never resembled a straight line up and to the right and I hope it never does.
However, thinking deeply about what we know before we know, open mindedness to and hunger for new data and extremely rapid posterior updating and ultimately the courage to create with conviction when we believe it is time have been the hallmarks of our operating model since firm inception.
The first rule of product design at stoneridge is we build products we want for ourselves.
Stoneridge is always the seed investor and whenever possible, but not yet always the largest. Consider our no device policy in this context. Would you ever pull out your phone and start scrolling in the middle of a meeting with your largest investor? At Stoneridge, we do not pull our phones out on each other.
With Stoneridge increasingly Stoneridge's largest investor, the scale of our profits as principals, not agents creates a level of alignment with our outside investors we are unaware exists elsewhere.
Those investors occasionally remark that this is a wonderfully clarifying and palpable distinction and that Stoneridge feels different inside.
Earlier this year Stoneridge Holdings Group, parent company of the Stoneridge Asset Management, Nydig and Long Tail re completed a significant primary equity financing led by an iconic American financial services firm. Also a mutual though this one a relatively spry 165-year-old we are thrilled to partner with in the decades ahead.
Despite regularly rising profitability, regularly raising primary equity for Our parent and affiliates $4.6 billion and counting and only primary ever has been our quiet way of strengthening our most important partnerships. Playing muscular defense when the sky falls in our markets and playing profitable post event offense in the aftermath.
Founding 2012 SRHG investors have received 32 times their original investment in distributions and now own Equity valued up 178 times net of those distributions. An annualized total return of 50%.
Fisher took 5,954 days to find the Atocha. We have been at it for 4930.
Every morning I bang our little ship's pots and pans with a smile because I know stoneridge will find the treasure.
Today's the day our partnership as we enter 2026, our tanks are filled with energy, gratitude and inspiration. We innovate to prepare for an uncertain future in pursuit of our mission. Financial security for all. Stoneridge is most proud of the partnership we have with you, our investors. We are on the path. Together you contribute the capital to propel and sustain groundbreaking product development.
We contribute our collective career's worth of experience in sourcing, structuring, execution, and risk management together. It works. In that spirit, I offer my deepest gratitude to you for sharing your wealth with us this year. We look forward to serving you again in 2026.
Warmly, Ross L. Stevens, founder and CEO.
[00:57:45] Speaker B: You know, my favorite thing about the Stone Ridge Investment Letter is that he always starts it off with a good story.
[00:57:51] Speaker A: And that's just, that's just great writing.
You know, it says something that I.
[00:57:58] Speaker B: Kind of get excited about the stoneridge.
[00:58:01] Speaker A: Investment Letter every year to read it on the show.
[00:58:06] Speaker B: I mean, think about that. That sounds kind of ridiculous.
[00:58:10] Speaker A: Honestly, I want to know what his.
[00:58:11] Speaker B: Book recommendations are, because I think it was the previous Stoneridge Investment Letter. He talked about the.
The team, and I can't remember the name of the captain now that that navigated the Arctic. And honestly, I feel like I'm missing.
[00:58:28] Speaker A: Some really great stuff from my reading.
[00:58:31] Speaker B: Lists or from my, my audiobook library that I, that I don't have a.
[00:58:36] Speaker A: Book on that story.
[00:58:37] Speaker B: I don't have a book about Mel.
[00:58:38] Speaker A: Fisher, because these would just be fascinating to dig into.
[00:58:42] Speaker B: And I just actually got like, I don't know, 15 or so audible credits for Christmas. I always ask like that. That's like my thing for Christmas is always get guy audible credits if you don't know what to get me. And then I also Audible had like a ridiculous sale. You know, my average price for credits is something like 12 to $13 per. And then Audible had a sale on a ton of different books that I had basically in my wish list. Like, my wish list, my, my actual audible library is something like three or 400 audiobooks. And then my wish list is probably.
[00:59:20] Speaker A: About the same size.
[00:59:22] Speaker B: And I had a ton based on.
In fact, there was a clip by.
[00:59:30] Speaker A: PD pbd, the PBD podcast.
[00:59:33] Speaker B: I can't remember exactly what the letters are, but he was talking about in two years. So this is, this is the way to find success in, in the next two years.
Read and, or listen to the top, like 20 books in finance, the top 20 books in marketing, the top 20 books in negotiation, and top 20 books in psychology. And I think there was another category. I can't remember exactly what it was, but I, I took him up on that and I was like, well, I'll start with like the top 10. And so I, I went through and.
[01:00:07] Speaker A: Added a bunch of them.
[01:00:08] Speaker B: There were some of them, actually that I had read like Rich Dad, Poor dad and Cash Flow Quadrant Quadrant by Kiyosaki. Then how to Win Friends and Influence People and I'm actually surprised that Hogshead, that's the author's name, which I recognize as a very funny name. And she actually points it out.
[01:00:29] Speaker A: Natalie Hogshead something.
[01:00:34] Speaker B: I can't remember her first name right now, but she has a book called Fascinate and then the sequel is like defining you or.
[01:00:48] Speaker A: Damn it, I can't.
[01:00:48] Speaker B: I can't remember the name of the books.
[01:00:49] Speaker A: But Sally.
[01:00:50] Speaker B: Sally Hogshead is the author. Look them up though. I'll try to find the. The actual names and links for the show. Notes. But they're two fantastic books on just the idea of.
It's really about marketing, but it's. It's. It's more about the idea of branding, of creating a story and a narrative around stuff. And I would also add to that is reading books about story. My favorite are the ones but the.
[01:01:20] Speaker A: Series by Lisa Krohn, that's C R O H N Start with Wired for story.
[01:01:26] Speaker B: And then there's Story Genius because she is literally a. A writer's.
What do you call. What do you. What do you call the job where you.
You literally kind of like the job of an editor in a sense, but it's like a writing coach, so to speak.
And she basically dispels tons of the myths about story and what the actual story is like. Get to the heart of it.
[01:01:52] Speaker A: Because most people confuse the plot with the story.
[01:01:54] Speaker B: And the plot is not the story. The plot is what reveals. Is kind of the mechanism used to reveal what the story is. And so many writers are just worried.
[01:02:03] Speaker A: About world building and a cool plot and all this stuff.
[01:02:06] Speaker B: And they forget that the only reason we read a story is is because of what we're. Is because of how the main character.
[01:02:15] Speaker A: Is experiencing it and what it forces them to realize.
[01:02:20] Speaker B: What the plot essentially, or what the actions and the interactions with the other characters and the progression of the plot force them to realize over the course of the book, it's about the internal story. And that's a very difficult notion to actually break down.
But out of all the books that I've read, there's so many books about like story and narrative and stuff that I believe really hit miss the mark. And. And this is from somebody. Like things like Save the Cat. Like, there's a really fun idea of the structure.
And I actually think there's.
[01:02:55] Speaker A: There's points to pull from something like Save the Cat. But if you read Save the Cat.
[01:03:00] Speaker B: I would also then recommend the book Kill the Dog because Save the Cat is a very methodical. Like, it's a systemic approach or systematic approach to telling a story. And that is not clearly a good story does not just follow the Save the Cat method.
[01:03:17] Speaker A: And the best way to think about.
[01:03:19] Speaker B: The Save the Cat or the Hero With a Thousand Faces sort of story structure, that's a plot structure. And there is a great use or.
[01:03:28] Speaker A: Value in actually understanding that because it's a great way to pace.
[01:03:34] Speaker B: That's probably what I would put those in the category of it's not.
[01:03:37] Speaker A: It's not about how to write a story, it's about how to pace a story.
[01:03:41] Speaker B: Because there's this constant of two steps forward, one step back, of ramping up, giving a break, ramping up, giving. Giving the audience a break that you don't want to overwhelm them. And that's far more about kind of the rhythm of story, the rhythm of a plot, and controlling or making use of the emotional power of your story. But if you don't have a character story, if you don't have a arc of what this.
[01:04:08] Speaker A: What this character is having to learn is having the internal change that they.
[01:04:15] Speaker B: Are experiencing, all the great systems and fantastic plots are all just gonna. Nobody's gonna read it. It's just gonna die. And the important thing to understand is that this is not just important for telling story. This is not. You don't have to be a filmmaker.
[01:04:33] Speaker A: To have the importance of this. Quite the contrary. This is important for anyone who wants to get.
[01:04:37] Speaker B: Wants to get attention for any reason or explain something or portray an idea.
[01:04:45] Speaker A: Especially if you have a brand, if.
[01:04:46] Speaker B: You have a business. Like, these things are critical because it's.
[01:04:50] Speaker A: Not even, you know, Ross Stevens, I.
[01:04:52] Speaker B: Think, does a very good job of. Of articulating or explaining this piece of.
[01:04:58] Speaker A: It without actually explaining this piece of it. Your culture in a company is defined by your narrative.
And I love that he mentioned that.
[01:05:07] Speaker B: He never has an HR department and.
[01:05:09] Speaker A: Never intends to have one.
[01:05:10] Speaker B: And that, like, I immediately, like, I don't even know, you know, I've not. I've certainly not have an HR department in my business. My business is tiny. I just kind of work directly with a few different people. But I genuinely hope to have a.
[01:05:23] Speaker A: Very large business one day.
[01:05:24] Speaker B: And it's not just about podcasting and that sort of stuff. The direction I intend to take a lot of this is a production company and a development company with paradrive and stuff. So. And maybe going in two different directions like that is just a bad idea, and I'm spreading myself thin.
[01:05:42] Speaker A: But those are the two core endeavors.
[01:05:45] Speaker B: That fascinate Me and I found the most value in and the things that.
[01:05:49] Speaker A: I want to build.
[01:05:50] Speaker B: And there's an element of, you know again Ross Stevens there's so many lessons in a lot of these things that.
[01:05:57] Speaker A: I've heard and or learned from so.
[01:05:59] Speaker B: Many different areas and that I have taken to heart. And it's just awesome to hear somebody who has such a level of success mirror ideas that I feel like are important but sometimes, sometimes I can't pinpoint exactly why or I was only like.
[01:06:16] Speaker A: Slightly exposed to them and they, and.
[01:06:18] Speaker B: I sort of held on to them without having a concrete example of why.
[01:06:22] Speaker A: But they just felt right to me.
[01:06:24] Speaker B: And another one of those is building products for you, right Is is build.
[01:06:28] Speaker A: Stuff for yourself because.
[01:06:30] Speaker B: And I also chatted with Praveen actually the chat episode which I think should come out today's. Today's Tuesday so it should come out tomorrow. But he said the exact same thing he did. They built Cove Wallet and he says, you know, if I spend all this money or this time and resources into building a thing, I'm gonna build something for myself. Because basically the worst thing that will happen is is that I'll have something that I want if this doesn't take off. And that's exactly how I think about it.
[01:06:59] Speaker A: And I love that Stoneridge has this.
[01:07:01] Speaker B: Philosophy and Ross Stevens have this philosophy that they're going to build products that they think that, that secure their financial situation. Like they are going to be the.
[01:07:11] Speaker A: Biggest investor in the products that they then sell to their customers. And think about the alignment that that produces. You're talking about removing the principal agent problem altogether because you're not an agent. You are building your own principle and then letting other people participate in it with you. And I'll compare that to banks that are trying to offload bullshit to their customers that dumped tons of mortgage backed securities on their customers trying to keep themselves alive and selling stuff that they knew were going to blow up people's.
[01:07:44] Speaker B: Retirements were going to destroy people's financial situations.
[01:07:47] Speaker A: And they were forcing, they were literally defrauding the American people through the ratings agencies by forcing the rating agencies to keep the ratings of these. Of this absolute garbage. Triple A when they knew all of it was going to default, when they realized that all of it was going to be garbage when it had started defaulting they still did not change the rating and they didn't allow it until.
[01:08:14] Speaker B: A there was either just, it was.
[01:08:16] Speaker A: Just impossible to ignore or some. Most of the big banks had exited enough of their position that they could Let the people understand that they had just bought worthless garbage.
[01:08:29] Speaker B: It's just awesome to see somebody not.
[01:08:32] Speaker A: Not just trying to prevent that, trying to not end up in that situation, but to structure the company around making.
[01:08:43] Speaker B: That disconnect an impossibility.
But all of that was kind of a rant off of the PBD thing about, like, in two years, if you're not successful, having read the top 20 of each of those categories. I'll try to find that clip too. In fact, I probably saved it. I probably saved it on my computer enter.
If I could just share a paradrive link.
[01:09:09] Speaker A: I'm getting there.
[01:09:09] Speaker B: I'm getting there, guys. I swear, I swear it's gonna be here, but I'm gonna try to meet that challenge. So Audible had a huge sale or whatever, and like tons of those books were essentially sub$10. Some of them were even on sale for like two or three bucks. And so I went and I spent like $240 or something stupid on Audible just buying up like a crap ton of those books off of my wish list. But again, I really want to know where those ones that I'm missing are, because I don't have one about Mel. You know, I want that book about Mel Fisher, wherever it is that, like, I don't. I bump into those stories on Stone Ridge investment letters, not. Not out in the wild. You know, actually I did have a fantastic book on which I don't even remember how I got connected to this one on finding longitude.
[01:10:03] Speaker A: On the.
[01:10:04] Speaker B: The discovery and the challenges and the.
The political corruption. Like you wouldn't believe. How cool the idea, like, latitude is super easy to find because it's just. It's just positioned where you are. It's not got anything to do, like where you are in time, like what time of the day it is or, you know, what the stars are doing.
Don't really affect your latitude. It's a. It's a much. It's a static thing. Whereas longitude is.
Is essentially constantly in flux because it's. It's on the axis is not the term. It's on the. It's on the plane of the Earth that's spinning. So you're trying to figure out how.
[01:10:44] Speaker A: To position the Earth, how to denote.
[01:10:48] Speaker B: Your position on the plane of the Earth, this constantly spinning. Whereas the latitude, when the Earth spins.
[01:10:55] Speaker A: The latitude doesn't move.
[01:10:56] Speaker B: The latitude's still in the exact same spot. So detailing out longitude, like determining precisely what longitude you were at, actually has this crazy story of like a guy, like spending dedicating his life to creating a device that does the job. And then everybody who was certain that they were going to find a solution by looking at and measuring from the star cars, basically trashing that device and manipulating data and information about how, how successful it was and trying to run like a fake thing to make it.
[01:11:30] Speaker A: Appear as if it didn't work.
[01:11:32] Speaker B: Like it's such a. It's such an amazing. It just that realizing how much corruption.
[01:11:37] Speaker A: And how much the establishment will fight.
[01:11:40] Speaker B: And deny and like attack people who.
[01:11:43] Speaker A: Come up with a better solution or.
[01:11:45] Speaker B: Come up with a solution that is.
[01:11:46] Speaker A: Not their mechanism or their means of, of doing it is just such a.
[01:11:52] Speaker B: Crucial historical lesson, in my opinion.
[01:11:55] Speaker A: And for something as seemingly mundane as longitude, which obviously during the day it.
[01:12:03] Speaker B: Was far more important, but today it's just kind of taken for granted. Like, of course you just tell the longitude. You just, you know, ask the satellite, right?
[01:12:09] Speaker A: But imagine trying to figure this out on a wooden boat in the middle of the ocean that is being propelled by the wind and the currents.
[01:12:21] Speaker B: I just paused it and went to find it. And it's a. It's a book by Dava Deva, so. Oh crap. I didn't mean to start it. Deva Sobel and.
Yes, just Deva Sobel. And it's literally called Longitude, so there was no fancy name. It's. It's just Longitude. But I recommend it. It was really fascinating. But I really like books like that, that stories about, about especially when it comes to something like Mel Fisher. Such a great example of, of just optimism, you know. I really like the book the Rational Optimist and something in one of the books that I read. I actually don't think it's the Rational Optimist, but I've read quite a few books about the psychology of that and perspective and how to think about things more about mental framing. And there's actually a logic to essentially endless optimism. And again, I don't even know what book I got this from or where the foundation of this was laid.
[01:13:26] Speaker A: But the more I thought about it.
[01:13:27] Speaker B: The more it was just so blatantly obvious that you can't.
[01:13:32] Speaker A: Pessimism is self defeating.
Like, necessarily so there is no.
[01:13:38] Speaker B: Like, imagine you've got some sort of an opportunity. In fact, basically everybody every day has some sort of an opportunity to do something great or to get access to something great. But nothing of any consequence is ever done for free. Like is ever done at incredibly low.
[01:13:55] Speaker A: Cost or cheaply or easily or with.
[01:13:58] Speaker B: No work at all.
[01:13:59] Speaker A: Like, there's no shortcut. The Second, something can be cheaply or easily done.
[01:14:04] Speaker B: It becomes ubiquitous and of no value or consequence. Like air in a place where air is hard to come by, is immensely valuable because it's hard to come by.
[01:14:16] Speaker A: But the second air is just available.
[01:14:18] Speaker B: That you can just walk around outside and breathe. The, the ability to go get air to just like put, to get a bucket and then put a cap on.
[01:14:27] Speaker A: It and be like, look, I got you.
[01:14:28] Speaker B: Air is of no, is of no.
[01:14:30] Speaker A: Use to anyone because it is easy. The things that are valuable, the opportunities that are legitimate are hard and are risky because hard, difficulty and risk are the things that define a thing that's valuable. And those things that will be most valuable are those that are most out of the norm. There are the ones that are not the established behavior. There are the business plans that aren't.
[01:14:54] Speaker B: Just copy pasta from the previous reinsurance companies.
[01:14:58] Speaker A: Like there's no manual on running a business or building a thing, on being an entrepreneur. Being an entrepreneur is the act of discovering which way of doing business or which way of creating things in the world is aligned with the way the world is. And the world is always changing. The environment is always changing, the people are always changing, the technology is always changing. There cannot be a manual for it. Not really. Because the act of production and the act of creating value is both a subjective and a relative thing. So if everybody can create masterful works of art, then explicitly not doing it the same way that everybody else is doing it is the way to find the value that everybody else is not tapping into. Opportunity is explicitly exclusive, but we have access to it all the time.
[01:15:50] Speaker B: So why don't, why don't people just grasp it?
[01:15:55] Speaker A: Why don't people always take it well? A, because it's hard. B, because if you believe you will not succeed, there's absolutely no logical reason to ever start.
When was the last time you did something insanely hard, insanely difficult, that cost tons of your time, your resources, your energy, the life that you have here on earth?
Knowing that was all going to fail miserably, knowing that there was absolutely no way that you could achieve anything of consequence by the end of it? No one would do that, ever.
Unless you're literally insane.
[01:16:33] Speaker B: And really, I could dig into a.
[01:16:35] Speaker A: Hundred other kind of like logical inconsistencies in it, but that's really all you need to recognize that it is fundamentally necessary to, to have optimism about your chance of success to ever actually succeed. And this isn't some woo woo out there thing. This is basic logic, belief about your success must necessarily come before any chance of success is real. You cannot wait to be optimistic about your chances until after you've already succeeded at something that was insanely difficult and took an enormous amount of your time and energy.
And being optimistic certainly doesn't mean that you're going to succeed at exactly the thing you think you're going to succeed at, or in exactly the way you expect to do so. In fact, that's never been the case for me at all. And I love the idea that Ross lays out in this of the the.
[01:17:30] Speaker B: Bayesian statistics, the Bayesian strategy of failing your way to success and recognizing what.
[01:17:40] Speaker A: What it was about the path that you have already taken that informs how you should change your path or your thinking moving forward. And that adaptability is the very core.
[01:17:52] Speaker B: Of whether or not you actually succeed.
[01:17:55] Speaker A: Can you adapt? Can you deal with the uncomfort, the.
[01:18:00] Speaker B: Discomfort, excuse me, of making hard choices, of making structural changes when something isn't working?
[01:18:08] Speaker A: I feel like the last two years.
[01:18:09] Speaker B: Of this show and my business and.
[01:18:11] Speaker A: Pear Drive and everything has been nothing.
[01:18:14] Speaker B: But painful hard choices like having to let go of people that I've worked with because I just didn't think they fit anymore. Or having to drop podcasts like AI.
[01:18:24] Speaker A: Unchained and shitcoin Insider and the Pear.
[01:18:26] Speaker B: Report, which I really loved, but not only just weren't giving me the return, but had just killed the notion of the type of work I was doing. The fact that this was all reliant on me. I was giving myself a huge job by just spreading myself so thin on. I'm gonna have some big, you know.
[01:18:46] Speaker A: Content production around every single topic or tool or anything that I spend a.
[01:18:52] Speaker B: Lot of time on.
[01:18:53] Speaker A: But it just didn't make sense, it.
[01:18:55] Speaker B: Didn'T line up and it wasn't the right direction.
[01:18:59] Speaker A: It wasn't even the right market really either.
[01:19:02] Speaker B: I was really just giving myself ten times as much work to hit a.
[01:19:06] Speaker A: Niche within a niche. You know, like most of the people.
[01:19:09] Speaker B: Listening to those other shows were just bitcoiners who listen to Bitcoin Audible or new Bitcoin Audible, and then also just.
[01:19:16] Speaker A: Wanted to dig into or hear about some subset or niche within the context.
[01:19:23] Speaker B: Of Bitcoin, like AI and the peer to peer stuff. Even though I was spending a ton of time on it. I was necessarily.
[01:19:29] Speaker A: I wasn't.
[01:19:30] Speaker B: I wasn't expanding my audience or increasing the quality and the accessibility of the content and the stories or the things I was trying to explain and tell.
[01:19:40] Speaker A: Quite the contrary.
[01:19:41] Speaker B: I was doing the exact opposite. I was niching down.
[01:19:44] Speaker A: I was dividing up my audience and.
[01:19:46] Speaker B: Specifically doing it in a medium that was already fighting for lots of people's attention. Like, everybody has a podcast.
[01:19:53] Speaker A: We don't need more podcasts.
[01:19:54] Speaker B: I mean, I won't tell you to not start a podcast if that's like, really what you want to do, because I also think the. That industry is growing, but you're also fighting for an enormous amount of attention. But I will say that a podcast, I think is valuable in its own right. Like, I love just being forced, sort of that forced isn't really the word, but having the opportunity to. To really delve into these things and kind of having to do so in order to make content around the show for it. So I. I can't really come up here and just like, have no idea what I'm talking about. I mean, some people do that. And I feel like an idiot if I'm just blabbing off. And I realize that, you know, I don't really know if that's the way this works. It just makes me feel like an idiot to try to talk about things. And that was actually at the beginning of the show was a really big part of it is I recognized there were these moments that I was having when I was trying to explain stuff to people where I recognized I didn't actually know. And if questions were asked, I couldn't actually defend my position because I had an actually dug into it. I had confused reading a headline or two paragraphs of a thing and then getting distracted and going to the next thing on social as having formed an opinion based on concrete information. And that just wasn't the case. And oftentimes you don't realize that until.
[01:21:14] Speaker A: You are actually forced to explain it.
[01:21:16] Speaker B: And this show puts me in that position. But then this also becomes a platform and a network for all of the.
[01:21:23] Speaker A: Other stuff that I do.
[01:21:24] Speaker B: It's kind of like I think of this as like my multiplier, so to speak. I cannot imagine there's very few things that I would want to do or would build that content creation and being.
[01:21:38] Speaker A: Good at explaining things and being good.
[01:21:41] Speaker B: At telling stories would not be beneficial to. And I feel like this is kind of my outlet to do that. So for that reason alone, even if it's not a profitable business, I think a.
A podcast or content creation like this is immensely valuable in its own right for.
Or at least in, you know, bitcoin audible, how I think about it, for what I get out of it, both personally, but then also in kind of like My network. And if you try to explain things, if you try to make things more accessible or solve someone else's problem or solve the framing for someone else, that ends up actually being valuable to you as well.
[01:22:23] Speaker A: So all this is really to reinforce.
[01:22:25] Speaker B: The point that Mel Fisher's today's the day optimism wasn't a nice to have in his success.
[01:22:37] Speaker A: 16 years.
16 years.
It was a necessity, without question.
The today's the day optimism was a make or break part of the entire mission, and it always is.
So if you think there's going to.
[01:22:59] Speaker B: Be some time in which you finally.
[01:23:01] Speaker A: Do find a thing in which you're certain you're going to succeed at, or you finally do believe that you're going to succeed because things suddenly go your way and in a cascading like one after the other, everything's starting to work.
[01:23:16] Speaker B: Out and finally you, you have optimism.
[01:23:19] Speaker A: About your situation or how you're going to move forward, or the work you're.
[01:23:22] Speaker B: Going to be able to do and the fact that it pays off.
[01:23:25] Speaker A: That's not going to happen.
[01:23:25] Speaker B: It doesn't happen in that order.
[01:23:28] Speaker A: You have to believe it first.
[01:23:30] Speaker B: And it's not because of some woo woo. It's not because you're, I mean, you can believe.
[01:23:34] Speaker A: And there's all sorts of great books talking about how you're pulling energy from the universe and you're aligning things and there is even arguments to be said that you are aligning other people around you. Because everybody wants to be around somebody that's optimistic. Everybody wants to be a part of.
[01:23:50] Speaker B: Something that actually has a chance to succeed.
[01:23:52] Speaker A: They feed off of your energy.
[01:23:54] Speaker B: So whether you want to call that.
[01:23:55] Speaker A: Universal, you use woo woo spiritual energy or just basic psychology, it's simply true. You have to believe right now that.
[01:24:06] Speaker B: Something is going to work.
[01:24:08] Speaker A: You have to believe right now that you can actually succeed at it. And you have to believe it so hard that when things start falling apart and everything looks worse than what it was, that you can take a minute and be humble and ask what's working and ask what is not working and then change your course, adapt based on that information that you have. If I had to guess off the top of my head, you know, the.
[01:24:33] Speaker B: Show isn't like wildly successful, but it is. I'm just looking at the stats and just kind of the notion of how podcasts like I am in the top 1% of shows, which is kind of wild to think about how big that.
[01:24:48] Speaker A: 1% is and the range of what.
[01:24:52] Speaker B: A 1% top podcast is because that.
[01:24:56] Speaker A: Range is huge, trust me. But in the eight years I've done.
[01:24:59] Speaker B: This, I have gone through at least.
[01:25:03] Speaker A: At least four, maybe five periods in which I was completely burnt out.
[01:25:13] Speaker B: I was certain it was going to fail and nothing was going to turn it around.
That progress was so unbelievably slow, that.
[01:25:22] Speaker A: Trying to turn this into a business.
[01:25:25] Speaker B: Felt like a complete waste of time.
[01:25:28] Speaker A: And I had to take a good, hard look at what I was doing at what was, working at what wasn't, and.
And to not confuse how I felt about it with the reality of it and to basically clean it up, to cut all this stuff, go back to what I've.
[01:25:48] Speaker B: What I enjoyed about it, what I was loving about it, and why I.
[01:25:52] Speaker A: Still wanted to do it.
[01:25:53] Speaker B: Because even those times where I felt.
[01:25:57] Speaker A: Burnt out or sick of it or.
[01:25:59] Speaker B: Like nothing was actually succeeding, I found when I really dug into it, it.
[01:26:03] Speaker A: Wasn'T really about the fact that I.
[01:26:07] Speaker B: Hated doing it or that I was sick of it. It was more that there were areas.
[01:26:13] Speaker A: Of it where I felt like I had lost control and it was driving me rather than me driving it.
So I simply had to correct course.
[01:26:21] Speaker B: And go back to the basics, really.
[01:26:25] Speaker A: And I'll tell you, I've done that at least twice with Pear Drive, especially with the amount of capital that I have invested in it and the amount of capital that I invested a couple.
[01:26:34] Speaker B: Of times while getting absolutely no results. I. I'm not even.
[01:26:39] Speaker A: You and my brother will attest to.
[01:26:41] Speaker B: This after I. I've lost quite.
[01:26:45] Speaker A: I've.
[01:26:46] Speaker B: I've lost some bitcoin on Pear Drive because I want so badly to see this work and I want to see.
[01:26:53] Speaker A: It in the real world because I just think it's a. I think it's a good idea.
[01:26:57] Speaker B: I think there is a.
[01:26:58] Speaker A: There's an implementation that just makes this feel seamless.
But I'll tell you, I didn't know.
[01:27:05] Speaker B: Jack about hiring a developer or knowing what was good or not coming into this. And I. I painfully learned those lessons. I mean, and I've only learned a few of them. In fact, I feel like I still have.
I have a whole oceans to cross when it comes to this. I've just kind of lost sight of the shore, really, at this point. But I broke down crying, just certain that this was the stupidest thing that I ever did, that I took a.
[01:27:34] Speaker A: Profitable company and just burned money on.
[01:27:36] Speaker B: A project that wasn't even going anywhere. And I had nothing. I had nothing in my hand after like a year and a half.
And God, I really hope this thing succeeds because not only will it make it feel like it was worth it.
[01:27:48] Speaker A: For all the cost and the resources.
[01:27:50] Speaker B: And the time that it took to get to where it is and to get to a success, but it would just be a really fun success story that I could get into how painful it was and what an absolute mess it was.
[01:28:02] Speaker A: But it might not. And at the end of this, I.
[01:28:04] Speaker B: Might just get something that. An app that I like, you know.
[01:28:08] Speaker A: But at least that's a consolation prize.
[01:28:10] Speaker B: At least I'm building something that I'm going to use.
So anyway, I hope I'm on the right course. And Ross Stevens and the Stoneridge investment letter always like, I'm not, you know, I'm not a reinsurance guy, like, but it fascinates me to hear his perspective and how he thinks about his business and how, how the entire team at Stone Ridge like the idea of thinking that three people voluntarily leaving in 36 months and over three years is something to see as a negative is just, it's just fantastic. It's like, it's like, hell yeah, have standards like that. You know what I mean?
And I hope one day I can have a business that's, you know, in a comparable level of success. And I think I can. I think that's doable. You know, maybe I'm, maybe I'm retarded.
[01:29:01] Speaker A: But today's the day, you know, try.
[01:29:04] Speaker B: To caveat and try to not sound.
[01:29:07] Speaker A: Arrogant, but I think it's gonna work.
[01:29:11] Speaker B: I just, I just do. I think it's a good ass idea.
[01:29:14] Speaker A: And I am also damn certain no.
[01:29:17] Speaker B: Matter how painful it is and how many, how many f ups I have along the way, I am certain I can build it. I know it can be built.
So Ross, if you listen to this.
[01:29:29] Speaker A: I hope to join you one day.
[01:29:31] Speaker B: In a different area and building a different thing.
But you inspire me to keep going and I appreciate that. And I love geeking out on a Stone Ridge investment letter and always appreciate your storytelling and what you guys have done with the business and sharing your frame for how to achieve something of meaning.
So shout out and I will have links and details in the show.
[01:30:04] Speaker A: Notes and guys leaving a review, sharing.
[01:30:08] Speaker B: The show, supporting the sponsors led in for bitcoin backed loans. I have a link with a discount. Like all of those things go a really, really long way. They help prove that you guys are listening, that you care about and get.
[01:30:22] Speaker A: Value out of the content and that.
[01:30:24] Speaker B: You trust that I'm not feeding you bullshit about the products and the services that I like and use. And I'm insanely picky about those things. In fact, I was very upset because a service that I had been using for a long time and had had a lot of faith in, I'm now having to turn down because of a. Because something that happened. And I'm very upset about it. But as I've said to sponsors in the past is that if I don't believe, if I don't agree or think that the service is worth promoting or that I'm a little uncertain about using it, there is zero way I can.
[01:30:59] Speaker A: Give you a good ad.
[01:31:00] Speaker B: There is absolutely no way I can talk about you for whether this is a positive or a negative. I don't even know.
[01:31:07] Speaker A: I like to think of it as.
[01:31:08] Speaker B: A positive, but gee, I am unable to completely incapable of selling something that I don't believe in.
[01:31:17] Speaker A: There are a few things that can.
[01:31:19] Speaker B: Make me sound more fake than that.
[01:31:21] Speaker A: And I hate it.
[01:31:23] Speaker B: It's like. It's like fingers on a chalkboard to me and it comes out in exactly how I talk about it. So take that as you will. And I hope my recommendations are useful. And I am very much enjoy and like our sponsors. And if you guys use the links that I provide, it makes a big deal or it is a big deal and it makes a big difference for the show. And I've actually got a bunch of other links that are really useful. Like even though like, you know, river doesn't sponsor the show. But I do have an affiliate link because they're kind of my main them and fold or my main bitcoin buying services. So if you're going to be using those. Got a link right down in the show notes. And thank you all for everyone who does. Thank you to the audionauts. So much for directly supporting my work.
For posting and zapping on NOSTR and streaming sats on Fountain. You guys kick ass. And a shout out. The last shout out to Ross, Stevens and Stoneridge. And I can't wait for next year's letter and talking about why and exactly how bitcoin is changing the world.
So with that I guess we will close it out.
I am Guy Swan. This is Bitcoin Audible and I will catch you on the next episode. Until then, guys, that's my two sats.
[01:32:56] Speaker A: The fool died. Both think he is wise. But the wise man knows himself to be a fool.
William Shakespeare.
