Episode Transcript
[00:00:00] If you control the money, you control the purchasing power, which in turn allows you to control most other things.
[00:00:08] This is neither hard to see nor hard to understand.
[00:00:12] If you can dictate who gets the money, you can dictate who is well off and who is not. If you can decide who is allowed to create new money, you can decide who has to work for money and who gets it unjustly with the stroke of a pen or the push of a button.
[00:00:28] If you can control the flow of money, you can decide who can pay, who can get paid, who can withdraw, who has access to their bank accounts, and who has access to financial infrastructure in general.
[00:00:42] In short, you can decide who will be deplatformed from society.
[00:00:47] In the most extreme cases, this is a matter of life and death. Who gets to eat, who gets and who must starve. Who gets to prosper and who must perish.
[00:01:00] Society is a game and the money is its independent reward system.
[00:01:06] So what happens when it's broken?
[00:01:09] What happens when society becomes an unfair game?
[00:01:15] It's time for a Guy's take Episode.
[00:01:18] The best in Bitcoin made Audible 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 has read more about bitcoin than. Than anybody else. You know, we are doing a guy's take today. This will kind of partially be to follow up inalienable property rights with Gigi, mostly just because there are a couple things that he brought up that actually want to talk about in this episode. But really more than anything, I wanted to do a guy's take because something he. A framing that he had in the piece is just something that I like to talk about. I've been writing about a lot recently and I felt like it would be a good idea to do a guy's take just to kind of get it all out of my head.
[00:02:28] And this is the idea that society is a game and money is its point system.
[00:02:36] And honestly, I increasingly think it kind of sounds like this is an analogy trying to explain the relationship, but it's not really. I actually think it's accurate because just in general, a trade like a barter with someone is sort of a game.
[00:03:02] It's a mutual agreement to kind of go do this back and forth dance, to try to weigh the. The middle ground between how I value something and this attempt to find this balance to what you value on the other side, to try to find this perfect yet totally unrelated match in what a thing is worth to make an exchange.
[00:03:31] And specifically this is voluntary or that's not what's happening.
[00:03:37] You know, a theft is not society is explicitly not society. It is explicitly not civil society specifically refers to a cooperative entity, to a group that is working towards the goal of preserving and prospering. So theft isn't society and theft isn't market activity in the exact same way that rape isn't like a relationship. So. So I actually think it's accurate to say that society is kind of like an emergent game that came about because we found out that if we played the game and engaged in this social comparison, weighing and swapping activity, that scarce resources become vastly less scarce if we're playing the game together.
[00:04:30] But the incentives and the rules of the game dictate everything about how the game is played.
[00:04:37] And there's only a particular set of rules and conditions of how things are being traded that will actually scale to both make resources not scarce and actually enable accurate balancing and weighing of all of the separate players intents and values.
[00:04:58] You know, I attribute the majority of, or at least an overwhelmingly disproportionate amount of my kind of like high school education to Science Olympiad. Science Olympiad is basically a nerd competition, right? It's this big event where you pull together teams of people from your school and there's like 2020 events or 25, I don't know, 2030 events, like different individual tasks or things that you engage in. Like there's some that are building related, there's some that are study related, there are some that are kind of like theory related. Like there'd be one that there's an event that just literally is just basically a test on plants and trees and everything, everything that you could think of in this area. It's like, okay, what, what's your breadth of knowledge on this and how much can you learn for this event? And they give like certain categories. And then one of the ones that my brother and I always did and really, really loved were the building events. We almost forever since, since we were in like fifth or sixth grade or whatever, we did bottle rockets.
[00:06:13] So we'd literally take a 2 liter bottle or whatever and you, you build a rocket and you give it a parachute and you, you figure out the different mechanism by which the parachute releases and you know, how you tuck it away so there's no drag on the way up. And your goal is to get as much flight time as possible with the same amount of, amount of pressure as everybody else. And then we'd have bridges and boom levers. And plane and, you know, mission impossible. And what's funny was the degree I didn't realize at the time, but the degree to which it was, it like literally required you to learn good engineering and good, like an intuition about the physics of an environment or something that you're building.
[00:06:57] It wasn't until my brother went to engineering school at State because one of his introductory classes, they had to build a bridge which was the lightest bridge possible, that held the most weight. And this was extremely similar to basically what we had been doing since middle school.
[00:07:17] But he said that everyone in his class, he could not believe this was a college. And some of these people did not have an intuitive understanding of just how to make a strong bridge that would be light. But my brother and I built one one year that was 23 grams.
[00:07:35] 23 grams or 25 grams? I don't know. In the 20, somewhere between 20 and 30 grams, literally. Imagine that like 20 paper clips in your hand, like, like it was light. You, you would feel like if you threw it up, it wouldn't really fall. It would, there would be more drag and it would actually fall slowly. Like, maybe not, but it just felt that light. And hanging from the center of this bridge over, I think it was 15 inches, maybe a foot, maybe the span was a foot. But from the middle of this bridge, it held 55 pounds of sand, which I think was like 2/3, 3/4 full sand in a five gallon bucket. So imagine you go over and you see a five gallon, one of those five gallon paint buckets that's almost full of sand, how much that would weigh. But the people in my brother's engineering class literally could not do this. They built some of the biggest, bulkiest things that you could imagine. And they were doing it in a lot of like pop sticks and straw or something. It's almost like a kid's level sort of thing. It seemed a little odd. That really wasn't the weird thing. The weird thing was just that nobody could do it. And my brother just kind of hands that he built one that was a little bit bulky or whatever because he wasn't, he basically wasn't trying so hard. He wasn't competing to make it as light as he possibly could.
[00:08:56] But I think he was the only one in the entire class that held the weight. And he held it very easily. And it wasn't as, it literally wasn't £55. Like, it wasn't even, it wasn't even that as much weight as our like freshman year bridge competition in Science Olympiad was so that's just a fun little side tangent on when you're hiring an engineer, you might not have somebody, you might have somebody who can do math, but you might not have somebody who has an intuition about how to build anything. And a half decent example of that is the engineer that I had to argue with and didn't win because he just gets to sign and say what the city tells me I have to do.
[00:09:35] Who made me put two soldier beams at corners in my concrete foundation, even though there were literal perpendicular walls that were already supporting. It's because after a certain amount the regulations have changed in my area. So that after a certain amount of dirt outside, the concrete block has to be filled and the foundation doesn't have filled block, which I would actually have liked it to be filled block. It's certainly a hell of a lot more secure. This guy was literally going by the book and doing his basic math clearly without accounting for why a boxed in structure is more secure than just a flat wall. And I'm talking to him because this is gonna cost me fifteen hundred dollars a beam. And not only did I not want to waste $3,000 on two pointless beams that weren't doing their job, it actually made because of the spacing. He said this is the code says you have to space it at this, you know, 6ft or 5ft or whatever for each one. But because of that, he was actually leaving the biggest spaces near areas that would actually need it. And if we just, if we just centered it like rather than putting one in the corner, that does nothing. Because a perpendicular 10 foot concrete wall up against a concrete wall holds a hell of a lot more weight. I don't have to do any math. I don't have to know the math to this. 10ft worth of concret concrete wall up against another concrete wall holds a hell of a lot more weight back than a 6 inch, 6 inch deep steel beam in 12 inches of concrete. I don't have to do any math to know that's going to work better. So you put the steel beams centered across the flat wall so that you're getting the most out of the. Because the middle of a 10 foot wall is the least secure. So you want to make. If you're putting three on that wall, you don't put them one in the corner, one six feet over, another six feet over and then a big gap to the next corner. You center them and you put them on either and then you put the other two on the, on either side. Not only is it gonna work, Better, but it's gonna save me $3,000. But no, that's not how the code works. Anyhoo, at least I'm not bitter about that one. Double check your engineer probably won't make any difference, but you can maybe just hire a different engineer. At least then if they're stupid, you can just change it later. But in the National Science Olympiad competition, there was a really cool thing that they did, which was.
[00:12:09] Seemed random to me at the time, but now I just look back on it and I think about it as this crazy thing that it's a learning experience. I think it's a great example here in relationship to the whole society as a game concept. But at the national competition, they would literally get all of the teams together, all the separate teams together in a giant auditorium, and you'd all kind of like sit down in your own areas.
[00:12:36] And you brought all of these things from your state or your life. I mean, not. Not like it had to be like state related. But that was often the case because you're, you know, at a place where there's a whole bunch of people who don't live in your state. Like, one thing that was really common would be unused license plates. Like, everybody, like there was a license plate for every state represented every single year, at least often a bunch of them actually. But the goal is to just swap stuff for something else that you wanted and to bring stuff that you thought would get you good things in a swap. And it actually, like I think about it now, is actually a really clever way to get you to go engage and talk and meet people from all of these other teams before you go and, you know, compete with them. And it, what it was a game.
[00:13:25] It was a game. Not only was it a game with almost no rules at the beginning, but with this huge emergent set of rules just in the norm of interacting with other people.
[00:13:41] But it literally felt like a game, and it played like a game. And the point was to figure out who has the thing that you want or that someone else needs, such that every person who has X amount of value can actually exit the game with twice as much value, even though nothing in the room actually changed.
[00:14:04] There was one amount of things brought into the room, but twice the amount of its value left. Because everybody got more value in exchange for something that they couldn't get.
[00:14:17] Something that was in high supply or easy to get for every individual who brought it. And in low supply and difficult to get or have nostalgic or, you know, novelty value for everyone. Everyone who leaves with It. And I literally did not think much about it at the time. It was just kind of like a thing that happened at national competition. We were. We were a small school, but we kicked ass at this. But now I look back on it and all I can think is, what a crazy little microcosm. I've thought of it so many times in various analogies or books and stuff that I read with Hayek because it was such an interesting. Like, I have neat little experiences of trading and talking to people and finding out what a thing was that I'd never even seen before. Like, it was.
[00:15:06] It was a game. It was. It was interesting. It was fun, like a game. It was engaging. There was a. There was a form of, like, competition and cooperation in it. And the goal was for everyone to be better off when they left than when they got there. And the game literally could work such that every single person, everyone literally got more points that they all at the same time. The point of the game was to figure out how for as many people, possibly everyone, to have more, to have a gain, while the responsibility of doing so was left up to all of the individuals in the who chose to play. Which is perfect, because how much. How better can you align incentives? Like, if I'm deciding for you, it's probably not going to work out nearly as well as when you're deciding for yourself.
[00:15:54] Obligatory reference to the give a shit matrix here. Watch it on YouTube if you don't know what I'm talking about. But the interesting thing about the game, that is society, that is the market, is that it's.
[00:16:08] It's like a cooperative game where we are all trying to find the optimal distribution of the resources we have access to versus the resources that we need.
[00:16:22] Except we're trying to solve the problem with only a single perspective's worth of knowledge and information.
[00:16:30] Like, we can only know from our perspective, from our values, and from our knowledge and situation and environment what is needed or what is going on. So the question is, how do you coordinate between everyone else's perspectives, values and knowledge?
[00:16:47] But the thing is, is that the incentives laid out by the structure of the game environment is what determines whether or not it is cooperative or competitive. And I mean that at a collective level, because it is always competitive. At an individual level. You're always trying to get basically the most value that you want while competing with another person trying to get the value that you're looking for. Two buyers go to buy the same PlayStation, whatever, the same house. So you're both bidding because you value the House, because this is the one that you really want, and it's also the one that that other person really wants. Or it's a great opportunity and there's a short time span, et cetera, et cetera, you're both bidding to try to compete, to see who.
[00:17:41] Who it's most valuable to. And the only way to do that is if they actually have skin in the game, they have to put the money down. You can't just say, oh, it's more valuable to me, but you're not willing to actually put up the value to prove that. That's like saying, I'm going to bet you a million dollars, but I've got $2 in my pocket and I'm clearly not going to pay you a million dollars if I lose the bet, or my opinion ends up being total nonsense. But the incentives and the structure of the game determine whether the overall movement of resources are actually net positive for the players or not. And the problem with the game that we played in that auditorium is that it was a barter game.
[00:18:23] When you introduce money, which is actually really interesting because a sort of pseudo money did actually develop at these places in this small environment on many occasions. I know people who traded for license plates so that they could trade license plates for something else. I actually did this myself because for some reason there were just enough people who wanted to collect, you know, a license plate of every state that they just became really easy to swap. So just the act of playing this game, a point system emerges because it's so much easier to actually make the weight, to actually compare the weights of your valuable thing against my valuable thing. If there is one single most valuable thing that we are all swapping between, that we are all trying to trade with. And I think people don't see it like that. Most people don't recognize that that's actually what's going on.
[00:19:25] They think of money as something that they want because they want other things.
[00:19:29] But they don't recognize that the point of money or that the way money emerges in society is as the most desirable good in the society, it becomes the most desirable good. And when you think about it in that framing, that's why I think about Bitcoin is Bitcoin won't be money, or it won't fulfill the role of a medium of exchange and a unit of account until it fulfills kind of the purpose of money to be the most desirable good in all of society.
[00:20:01] Everyone everywhere is going to want to hold it, because that's literally the thing that money Is everybody wants it because everybody wants it. It's the ultimate network feedback mechanism of value. And the thing is, is if it is perfectly scarce, the more scarce and provably scarce it is, the more that feedback loop actually works for its own benefit, because more people want. Wanting it makes it more valuable, and the individual units go up in value. Bitcoin could not be a more perfect example of exactly how this plays out. It's going up forever, Laura. Literally. But we're so used to trash money. We grew up in such a horrible. We were literally born into such a horrific monetary environment that we think of money as something that degrades over time. It's still the most necessary good, but it holds none of the mysticism and kind of mythology around it that gold held because of its success as the hardest money in the world and the most ubiquitously verifiable and, you know, globally, like universally available money in, I don't know, for thousands, thousands of years. But one of the most critical elements, one of the most critical characteristics of that thing that becomes money, in fact, the prerequisite that only makes the other elements of money worthwhile. The fact that it's uniform, the fact that, you know, it's fungible, portable, all of those things, is the fact that it is scarce and that even when 10 times, 100 times, a thousand times more, people value it a thousand fold of its previous evaluation, as measured in other goods that it's still too difficult to make more of, it's still scarce enough that it can continue to increase in value. And still nobody can actually cut off that feedback loop because they find a way to create more of it for less than its current valuation.
[00:22:11] The reason gold has a. Has a price cap is because you can irradiate lead and make more gold.
[00:22:19] But it probably costs like, $100,000 an ounce worth of energy to pull that off. I don't know. It probably costs more than that. But the thing is, is gold has a price cap because if it ever reached, if it ever became so desirable that everyone wanted to hold it, that it became worth $200,000, $300,000 an ounce in today's money, obviously, because if we're measuring it in dollars, dollars eventually will. It will be worth $300 an ounce, because dollars will be worth that little. But if that ever happened in today's dollar's value, somebody build big machines that turn lead into gold, and the price would come right down to whatever the price of energy is to turn that lead into gold, and that would be the end of gold being able to scale as money, it would no longer serve the purpose for a society that had become that technologically advanced and that large and that valuable. And something else would have to take its place.
[00:23:15] Charles Munger said, show me the incentive and I will show you the outcome.
[00:23:21] The money is the point system of the game and how you are awarded and how the points are created in the game create the incentive structure for its play.
[00:23:34] And in that one mechanism, in that one tool, you can turn a cooperative game into a destructive one very easily. In fact, all you have to do is have control over the money. To shift society from a game of mutual preservation to one of dog eat dog conflict.
[00:23:58] The very design of the system that we are a part of necessarily produces an unfair game.
[00:24:08] I think people don't know how easy it is to actually get a bitcoin backed loan now and not have to sell your bitcoin. I personally think the best way to actually utilize this is if you're doing an investment where you know you can beat the interest rate, but obviously you're not going to beat or you're extremely unlikely to beat the return that bitcoin is going to give over the next couple of years.
[00:24:33] Leden IO L E D N I O makes this crazy simple. I never recommend, I would have never have used them until they survived a full cycle and bear market. But then they also cut all of their other offerings. They used to do Ethereum as well. They did, they tried to do a yield product. They decided that all of that was just noise and they cut it all away and now they just do full custody, proof of reserves, bitcoin backed loans. Simple, straightforward and easy. And also checking the proof of reserves is actually really easy. And I'm still shocked that this is not an industry standard. But this is just a great tool to have a great option to have on the table if you need access to fiat and you don't want to get rid of your bitcoin. Obviously bitcoin is volatile and you don't want to over leverage. You want to do a safe and manageable amount. But if you haven't looked into it, you should check it out. They are literally an open book. You can find all the details at the link right down in the description.
[00:25:35] So I want you to imagine a game and there's something interesting about this game is that everyone has to play it.
[00:25:43] No one is outside of the game. Even the supposed game designers and the referees and the owners like all of this stuff. Everybody still basically you can't escape Being out on the field and playing the game, no matter what role you're playing in trying to keep the game running, you are still in the act of playing the game while running the game.
[00:26:09] Now, the point of a game is to show the creativity, the teamwork, the beauty, really, of a kind of cooperation in a control in a restricted environment is how can you accomplish something amazing? And that's what we want out of it, is we want to see other people accomplish something incredible. And the reason we understand a feat to be incredible, the reason we understand how the struggle, the sort of proof of work that is involved in scoring points, is because we understand the restrictions of the game. The environment is a set of limits that, within those limits, create a kind of a remarkable type of gameplay in order to achieve a score. So think of like a touchdown. The point is to.
[00:27:05] Is for your team to be organized enough to be, you know, intuitively on the same page. To know. To have been trained over and over to feel the movements and decisions of the people around you and to plan out exact plays that trick the opponents, that overwhelm them in order to get a ball across a field when there is another team identical to you trying to prevent you from doing that. And the brilliance of the game is figuring out what they can come up with, what skill and what elegance they can develop in producing that result in fighting against another team that has done everything and worked as hard or nearly as hard to stop them from accomplishing it. It's really important that only if the two teams have the exact same restrictions and are playing the exact same game, is there anything meaningful about the outcome of play or that the acquisition of points actually means you were the better team?
[00:28:19] There was an experiment done.
[00:28:22] It was with a game of Monopoly, and they had two people play against each other. And one of the people would start normally with the $200 or whatever. I don't remember exactly how you start the game. I hadn't played it in a million years. But they would have another player come in, and they would even tell them that they started with a ridiculous advantage. They'd give them like $2,000 or something, and they'd already own a piece of property, or they'd get a discount on, like, their first few pieces of property or something like that. But it was a blatant, lopsided advantage. And every single time, obviously, the person who had the very, very unfair advantage destroyed the other person. But then they had, like, an exit interview and. And they literally asked them, why do you. What do you ascribe to your winning of the game. And they would like go through all of the decisions that they made and how they made a better investment decision here. And they had this property which was, you know, the reason that this happened. And you know, they were getting a bigger income and they just, they spread it out. It was all about the strategy and the decisions that they made. And practically none of them actually talked about the fact that they started off like 20 moves ahead of the other player. And I saw a Twitter thread about this. There was social comments or something, maybe it was under YouTube video or something, I can't remember. But I remember the reactions. I remember thinking about the comments because the conversation was largely around, oh, people are super crappy and they're, they're shitty and they don't realize that. They don't care that the rich people are crappy and horrible scum of the earth. I remember thinking like, there's no, they didn't, like the players weren't rich. It's not like they, you know, they went to affluent neighborhoods and gave only those people advantages.
[00:30:15] Now these were normal people like all of the other players.
[00:30:19] I think the people in the comments were kind of missing the point.
[00:30:23] They were choosing to see this as some horrible negative thing or negative characteristic about these people rather than what I think the actual truth of the matter was is that none of them wanted to see themselves as an unfair player.
[00:30:41] They didn't want to see that they had cheated. They wanted to actually play the game. They wanted to be good. So they were trying to convince themselves that they were good at the game and they chose not to look at the unfair advantages they got. They were trying to allow themselves room to see themselves as a normal player like everyone else, rather than being malicious, evil, crappy people.
[00:31:12] The point is that they were put in a situation where they had an unfair advantage and they wanted to see themselves as normal good people.
[00:31:23] So rather than facing the uncomfortable truth, they simply focused. It was too easy to focus on everything else. And there were hundreds of moves during this game and hundreds of decisions and calculations and all of things that all of these things that they made. And so they use this as a distraction so they don't have to think about the fact that they had an unfair advantage and that really none of it was earned because they did do a lot of work. They did play the whole game. It's not as if there's no complexity or no work at all in just having some built in advantage. So of course they're going to focus on what they actually did to succeed at the game rather than what they didn't do to succeed at the game?
[00:32:11] And all I'm getting at with this, what I want to the point that I'm trying to drive home is that the incentives and the structure of the game are everything.
[00:32:21] It doesn't matter whether the players are sociopathic lunatics or if they are literal angels who only want to do good. I mean, think about it. How good of a person are you?
[00:32:34] You think of yourself as a good person. You want to play fairly. You don't want to get an unfair advantage. But if you found a million dollars hidden in the walls of your house from the previous owner, are you gonna like set it on fire because you don't want an unfair advantage?
[00:32:51] Or is it simply going to be that it's fair that you lucked into a million extra dollars that other people don't get? Or is it easier to excuse that, you know, you want to do better for your family and you want to do good in the world. You're a good person, therefore you're going to be able to do good things with this million dollars. So why wouldn't you have it? You're going to just give it up to somebody else, or, or you're going to lose the money, or you're going to give it up to the government or something. They're going to do something terrible with it. So it's better that you have it. And I'm not, I'm certainly not arguing that you should burn the money that that situation. You should absolutely take the money. But finding money in the walls of your house is not a systemic monetary problem. It's not something that destroys the very fundamental incentives of society.
[00:33:35] But when you have something that is systemic, there's not even a way to counter it.
[00:33:40] When we're talking about the way money is corrupt, there's nothing you can do but pointlessly hurt yourself and make bad decisions in order to attempt to balance out some sort of unfair advantage. Like imagine if you just arbitrarily decided that you were going to pay for, you were going to pay 12% on your mortgage, even though you were offered 5% simply because you didn't want to get an unfair advantage on the devaluation of your debt with the printing of the money.
[00:34:14] How does that make any sense? And what could you possibly cheating yourself out of a more affordable life? What could that possibly do to help solve the systemic monetary problem that is poisoning our entire economic system?
[00:34:31] Yes, it's an unfair advantage because you have access to credit which will be devalued at the expense of all net producers in society. Society, but you not engaging in that has absolutely no effect whatsoever on the fundamental incentives of the game that are in fact causing other. They are incentivizing and directly rewarding people for making that same decision.
[00:34:57] Which means that even if the entire economic system was nothing but literal angels of perfect justice, it would still be a game, a race to dump the bag onto somebody else and get as much debt that will be devalued by the destruction of the money as possible. And there's nothing you can do about it except replace the money.
[00:35:23] You have to fix the money.
[00:35:26] So I want to take a step back.
[00:35:28] I want you to imagine a game.
[00:35:31] Let's use a sport like football, American football, for our comparison.
[00:35:35] Now, have you ever wondered what the point of a game is?
[00:35:40] You know, why do we have so much attachment and fascination just unbelievably engrossed with a game?
[00:35:50] So games are.
[00:35:51] They're a microcosm of the real world.
[00:35:55] It establishes a set of rules and restrictions, an environment that players have to work within in order to see them struggle to innovate, to adapt, to overcome in order to reach a clearly defined goal.
[00:36:11] Life is full of ambiguity. Life is full of messiness and cloudiness. And we have all of these goals, but they're not exact. There's not like a clear finish line. Everything just kind of merges into each other. But the exact same thing is the point of life. Like this is the mission of life that we are constantly going on is bumping into the universe, into the environment that's constantly trying to kill us a thousand different ways.
[00:36:40] The lack of food, the lack of scarce resources that we need to better our lives or to support and secure our family's future. And we have these constant mini goals, we have these short term goals, these long term goals, these midterm goals, all of these things that we structure our decisions around and all of these restrictions, restrictions in which we're trying to reach these kind of markers or conclusions or this feeling or sense of certainty. The reason we love games so much is because it takes away the ambiguity, but it keeps that deep desire to complete a mission and the restrictions and the conflict that make being working on a team and innovating and adapting in order to reach that goal. It's like a.
[00:37:30] It is literally a microcosm of life. It's kind of like how a story or a film is this super focused sequence of events about a character, about a change in a character. And the process, the.
[00:37:48] The plot of the life, the plot of the story that they go through, to see through that change, to reframe something about how they see the world. They have some deep inner desire that they want to accomplish. And these are all the things that have gotten in their way in order to. To solve that, to reach that goal. And the story doesn't. There's billions of little things in that story that aren't actually there, right? They don't. They don't show them driving to work. They don't show them parking and, you know, having to pull up their socks. They don't show. They skip right from the last scene where they were talking to somebody about what the one thing is that progresses the story forward, and then, boom, they're in a totally different place with a totally different person or an entire other thing is happening that is specifically relevant to the character struggle and the plot. Everything in between, everything that is unnecessary and unrelated is stripped away. This is kind of like what a game does for the mission. It says, here's a goal. Take all of the ambiguity out and set clear restrictions, because that's rewarding. The payoff is clearly defined. The obstacles are clearly defined, the environment is clearly defined. That creates both a sense of certainty because you know within, you know, what span of possible outcomes in which the things could actually play out. But then it also creates an enormous amount of suspense because there are explicit limits to the field and to what actions you can take. And there's an explicit timer that's counting down, and there's an explicit goal right there. And you're like, we know we can get across it if we just do this, but you don't know what you're. What your enemy is going to do to stop you. And in that sweet spot is where the perfect amount of creativity and just raw human energy comes alive. You know, one of my favorite writing professors, one of my favorite professors that I ever had, which is funny because I didn't actually take English, but I've always loved writing.
[00:39:52] I went to film school because I love stories. But one of the things that she said that I thought was so cool and was such a great framing, was that most people think that kind of the secret to creativity is just having unlimited options. Don't restrict yourself at all. Just put a piece of paper in front of you and now you can write anything you want.
[00:40:17] Don't worry about what it just anything. You have the whole universe of options, when in reality that's actually more often than not the source of writer's block because you're overwhelmed by the fact that why would you pick this one thing when literally infant infinity is your list of options. And that part of the secret of encouraging like creative juices and, and getting you in the flow of actually writing is to actually build in restrictions, build in a prompt that locks you in to some environment and so that you have to write your way out of it. The way to tap into human creative energies is to literally put barriers in your way, clear barriers, so that you can knock them down.
[00:41:05] That's the beauty of the game.
[00:41:07] Now imagine if the game was designed poorly, what would be the outcome if you broke the incentive structure?
[00:41:16] So what if the referees and the owners of the arena could actually just hand out as many points in the game as they wanted? And for a while, this is seen as, you know, unfair, you know, out of character. And it's clearly at odds with the actual game being played.
[00:41:35] But it happens just a little bit at a time until it just becomes normalized. And remember, the referees and the arena owners and the executives, they're all part of the game too. They actually get out on the field and they play the game. We're talking about the game of society. In analogy, no one is actually separate from the game, even the managers. So what happens?
[00:42:00] Well, the referees are going to figure out how to give themselves points. The executives and the owners are going to figure out how to give themselves points and their. Their spouse's points.
[00:42:10] And over a long enough timeline, the players are going to realize that playing the game isn't as successful as just playing the referees and the executives on a long enough timeline. If a referee, if an executive, if an owner, if the people up in the box seating can determine who wins the game, they can just issue 40 points to a particular team and it just kind of becomes common for teams to just win because they got issued 20 points, who's going to keep spending all their energy learning how to play better football?
[00:42:48] And this actually brings me to a point to a quote that Gigi had in his piece, the inalienable property rights that we covered in the last episode.
[00:42:58] If you control the money, you control the purchasing power, which in turn allows you to control most other things. This is neither hard to see nor hard to understand.
[00:43:11] If you can dictate who gets the money, you can dictate who is well off and who is not. You can decide who is allowed to create new money. You can decide who has to work for money and who gets it unjustly with the stroke of a pen or the push of a button.
[00:43:28] If you can control the flow of money, you can decide who can pay, who can get paid, who can withdraw, who has access to their bank accounts, and who has access to financial infrastructure in general.
[00:43:43] In short, you can decide who will be deplatformed from society.
[00:43:50] In the most extreme cases, this is a matter of life and death. Who gets to eat and who must starve, who gets to prosper and who must perish.
[00:44:01] The incentive to cheat a game like football is one thing, but the incentive to cheat when you can arbitrarily determine and create as many points as you like for the system that literally defines who lives and dies, whether or not you live a life of luxury or poverty, there is quite possibly no greater power you can have in society than that.
[00:44:28] And also think about, even in football, as the analogy is, how easy it would be to excuse the behavior. Because obviously, you know, maybe the refs are really smart people. Maybe the executives chosen were really successful. Wouldn't they know better which football team to invest in, which players are the best? They're not going to see themselves as evil authoritarian overlords. They're going to see themselves as benevolent leaders who are just trying to make society a better place, make the stadium and the game really a fun and beautiful place to be.
[00:45:05] And it just so happens that they need to use this awesome godlike power in order to make it according to their vision.
[00:45:13] They're doing it for the good of society.
[00:45:16] And how important this job is that of course, in order to be the masters of the game, to determine how the game should be played out and who should get points. This is a really important job. So obviously we have to pay ourselves so that we don't actually have to get out on the field and play.
[00:45:33] We'll just always get the points necessary to win. Because this is just an. This job is just that important.
[00:45:40] They'll simply offer points on better players to play on their behalf.
[00:45:46] So what happens to the weaker, the less skilled, or more importantly, the less politically connected players, the ones who don't have a cousin who knows the ref, the one who doesn't get to hang out with the executives, what happens to them?
[00:46:00] It becomes harder and harder to even get a few points. And even the points that they do get don't really make any difference.
[00:46:09] While the quote, select teams, the ones that already get all the publicity, the ones that everybody already knows, the ones that hang out with the executives, their teams and players get a flood of points that never seem to end.
[00:46:21] Imagine if you were using these Points to trade for valuables like these were literally the points of society.
[00:46:28] And specifically they are doing this with inflated points.
[00:46:33] Literally anything of significant value that the elite players, the teams and executives and refs wanted to own would necessarily be completely out of reach for all of the other players and participants because they would always be able to bid higher.
[00:46:52] And so they would just keep bidding higher until they're the only ones who own it.
[00:46:58] And the only way to actually make sure you're in the club to get enough points to then buy and own one of those things of value, you literally just have to get. You have to curry favor in the group that's able to issue these points from nothing.
[00:47:12] If you did this in the game, there would literally be an entire industry that built up, one that doesn't exist in the game at all, but one that built around the group who could issue points for everyone who wanted the points and didn't want to have to run the ball across the field, which honestly is literally everyone. Because everyone wants an easy way to do things. And they don't think about it as a systemic destruction of society. They don't think about it as a malinvestment of trillions of dollars worth of wealth that's literally cannibalizing our own civilization and eating us from the inside out. And they don't attribute the very struggle that they are trying to get out of as being caused by the thing that they're now doing to get out of it. The desperate begging of more points from the big machine that just cheats the entire game. They don't realize that that's poisoning the very game which keeps them where they are begging for more free points.
[00:48:14] They're just trying to get by. And things are harder and harder and more and more expensive every single year. And it's harder to get more points on this in this stupid game. And even when they get a freaking touchdown, it never seems to make any difference. They only lose.
[00:48:31] So an industry builds up an entire part of civilization around doing the executives favors, bribing them for investments, proposing great theories and plans on how to make the game better so that they'll invest in their great plan to fix the game of football.
[00:48:54] The goals and all of the energy would shift from being devoted to actually playing the game and toward having the better sounding proposal to improve the game so that they can get points from the owners of the game.
[00:49:13] There would be an endless amount of BS talk about the better way to play the game and nobody would actually play. We'd end up a Stadium full of critics who don't know how to hold a football.
[00:49:28] There would be more points handed out arbitrarily than ever before, and less and less actually putting the ball to the grass.
[00:49:37] All theory, no execution.
[00:49:40] And think about what this does. Culturally, many of the weaker players would likely just give up entirely, believing that there's no actual point in exerting oneself for a game that makes no sense.
[00:49:52] They would become nihilists, and instead of trying to become more powerful and gain favor and influence, they'd just become bitter and try to appeal to the pity of the executives. They'd just be angry and they'd just demand it. They would endlessly claim that they didn't have enough tall players, and so it was unfair. They'd say that because they don't have enough money for good jerseys, they're at a disadvantage because confidence is everything. We just need a boost in our confidence.
[00:50:20] They'd beg and throw tantrums for points, causing any disruption or fuss so that they could worry. They could make the executives and the referees worried that they're going to do something violent or just terrible unless they get a little points to help them out. And so the executives and the owners decide to throw a few points their way just to keep them quiet. And they'd create a bunch of pointless rules that all geared toward placating the crappier or the disadvantaged players. Like, oh, if you're less than this tall, you get two points at the beginning of every game. Nothing that would actually make a difference. But enough that the behavior became the foundation of this entire culture of players.
[00:51:04] Now they're entitled. Now they hate the players on the other side of the field for having more points, because having points seems like a completely arbitrary thing, and it's simply a systemic lack of fairness that they don't get it. Who's even playing football anymore? What does that have to do with anything? The whole game is stupid anyway, and everybody's just cheating. Why shouldn't they get more points? And so a cycle of begging, demanding, fighting, appeasing and reinforcing behavior that grows and grows and grows. After generations of players doing this, nobody even remembers what the hell the point of the game was.
[00:51:41] Now there would, of course still be players who just loved the game for its own sake, but they wouldn't be rewarded nearly what they should be.
[00:51:53] They wouldn't be able to afford anything that was truly limited or desirable. They wouldn't really win many games, but they would push on anyway, knowing that the playing of the game itself was the Thing that actually felt real.
[00:52:09] They would see the entire stadium and all of the crap and this industry of appeasing the refs and the owners and executives, they would see all of it as fake because they would wonder, none of these, they would say, none of these people can even play football.
[00:52:23] What the hell is this?
[00:52:26] Now, they may not understand why the game isn't working, but they know the difference between actually carrying the ball through the defensive line and crossing the end zone. And the politics of pretending that you have the perfect play that will never fail and pitching it to a boardroom of executives who decide whether you get 50 free points or not. They have no interest in pretending they love the act of playing, even if the reward seems inefficient.
[00:52:56] But you know, the worst thing of all is we talked about that.
[00:53:02] The clear distinctions, the restrictions, the clear environment and the clear goal. This is how you unlock human, innovative potential. Potential. This is how you unlock the energy of creativity. The worst thing that this does against everything else is that it makes the game itself uninteresting.
[00:53:22] Actually playing the game becomes a distant second to a die hard focus on the politics of the executives.
[00:53:31] There would be reality shows about them, endless commentary on who insulted who and who's going to get the new seat in the board and which person has more power and who wasn't going to get the points because of the unpopular opinion they dared to speak in front of the refs. The entire system devolves from a game of skill, creativity and honest hard work into one of grift rhetoric, victimization and political favor. And it's all because you destroyed the meaning of the points.
[00:54:02] It still holds the shell of its former purpose, but it's lost all its meaning. In many ways it still kind of looks like football, but it's mostly just a show.
[00:54:12] And the skills of actually playing are worse than ever.
[00:54:16] Everybody and their first cousin has an opinion about the game and how to play it, but almost no one can actually play it anymore. And as soon as it becomes hard, players start making excuses about which way the wind is blowing and how the executive should give points to the offensive team. If the wind blows against them during a play, people start coming up with any and all reasons to issue points. Too many tall players, not enough fat players, team colors are distracting. The field's too wet, it's too cold to play. We should invest in a team that plays a more sophisticated and less brutish version where we just stand on the field and argue about who deserves to be in the end zone and all of this feeds back on itself. The worse it gets, the worse it devolves down this path.
[00:54:57] Important thing to understand is that the rules of the point system are exactly what make or break the game.
[00:55:07] The incentive structure is the game and how the points are obtained are what set its boundaries and determine the behavior, the culture and the skill of the players in the game.
[00:55:22] Society is a game.
[00:55:24] It is an internally competitive.
[00:55:26] You compete with other individuals, but an externally cooperative everybody is actually working towards the goal of a flourishing society, of being able to produce more, better, at lower cost.
[00:55:40] It's a game where we compete to solve the problems of survival and hold back nature's infinite attempts to try to kill us. It's about growing food, it's about fighting disease, building homes, communicating ideas, testing theories, trying out experiments, sharing stories, teaching skills, entertaining each other, finding love, keeping the species alive to play on.
[00:56:07] Society is the game of flourishing and the money is the point system that keeps it aligned with reality so that the positions we play and the skills we learn actually have real consequences. And they are responding to the truth of the world and that they don't have us focused on the wrong thing over and over and over again in this terrible feedback loop until reality comes back to punch us square in the face because we were living a lie. At some point in that football game, if the ability to play good football was determining whether or not people lived or died, it doesn't matter how great the statistics on or all the economic exchange and how great the master plans are, at some point you're gonna their whole stadium is gonna suck at football and people are gonna start dying.
[00:56:56] The record of monetary history on this issue is crystal clear. There's not a single example of a hard money dying because it was too hard. And every money that has ever died was because it was cheated. Like crystal clear. There's not a single example anywhere to the contrary for anyone out there who thinks the Great Depression is somehow some exception to this, I'd argue you've let the refs form your opinion rather than looking at the extremely simple facts of the matter. And oh so coincidentally it just so happened to occur right after we established our central bank. Yeah, sound money did that, I'm sure, but the analogy to the football game is unfortunately a very accurate picture of how our money works and what it has done to our society.
[00:57:45] Banks have the authority to create money backed by nothing, to rehypothecate the money we deposit. And actually they don't really need the money we deposit anymore. They can create their own Money which creates a deposit, which allows them to rehypothecate money that is just rehypothecation. And because there's no distinction between actual credit and the money, the money is credit, this can continue indefinitely.
[00:58:09] Until of course, we run out of resources.
[00:58:12] Our central bank issues trillions of new dollars every single year and pushes it into the financial and political systems.
[00:58:21] And all of our focus has shifted toward this massive machine of counterfeit. All our conversations have shifted to politics. And every election is the most important election of our lifetimes. And it's all devolved into fighting and a opinions on how the game operator should control things and who should arbitrarily get more points instead of actually playing the game. What does it mean to be productive? What does it mean to live a fulfilling life? What does it mean to actually do something meaningful that's beneficial for society? No, everybody just wants to figure out how to get more points. And the way to get more points is to cheat the debt system. That's how you get really truly rich.
[00:58:58] This is exactly what's happened to our society, to actually all of western society really, over the past hundred years. More acutely over the past 50 or so, our money no longer has a strong basis to the scarcity of real goods.
[00:59:17] It has lost its connection to reality. We are fully in the era of devolution, where we believe the points are the purpose of the game.
[00:59:28] And we show literally all of the signs of the rot that comes with this immense error.
[00:59:34] Our money has largely become a point system for political favor and quote unquote creditworthiness that feeds back on itself because only the credit worthy can actually outpace the inflation rate. Because those with the most credit are constantly having their obligations devalued. And so that makes them more credit worthy and they can get even more credit. And think about it. If everybody who actually wants to maintain their wealth has to put it into the richest things, into the biggest things that are actually going to outpace inflation, it literally means that the entire society ends up shifting around. Arbitrage credit arbitrage.
[01:00:09] When the money supply grows by 7 to 10% every single year. Anything under that you should just take, no matter what.
[01:00:20] If it's just going to keep its value, not even gain value, not even be productive for society, just so you can arbitrage the lowering the rotting value of your obligation of the debt that you owe back to society. And this is of course a 3, 4, 5 trillion dollars market, because that's what money, that's the amount of new money that's being printed every year. So it's the biggest industry, it's the biggest one is arbitraging this massive counterfeit machine. It becomes a point system of political favor.
[01:00:53] And the long term consequences are that the game, the literal game of society steers away from its fundamental purpose to produce goods that people want to cooperate for our survival, to continue the species and to create prosperity and growth. It steers away from this. And that misalignment can only go on for so long.
[01:01:21] And I think we're in the process. The finding out stage will take probably 30 to 50 years too.
[01:01:27] And I unfortunately think we're, we're finding the limits right now. We're in the middle of the finding out stage and we effed around for a really long time.
[01:01:37] This is why bitcoin is not a choice between new tech and old tech.
[01:01:43] It's a choice between whether or not you want to realign society with its very purpose or if you want to keep playing a corrupt game.
[01:01:52] You want to continue to see the negative feedback incentives play out and just scrape by with as much as you can from a broken system that's literally leading the society into the side of a mountain.
[01:02:06] I say it's not a choice because the choice is literally fix the money or watch it all collapse and try to start building back from the ashes.
[01:02:17] That's what history basically says is in store for us every time this happens. That's how it plays out. We might actually have an option, but we have to fix the money.
[01:02:28] That's why if you're hanging around bitcoiners for long enough, you'll eventually hear somebody say fix the money, fix the world.
[01:02:36] All right, I think that'll do it. I think I got it all out of my head.
[01:02:43] Don't forget to check out LEDN if you want to do bitcoin backed loans. I'm a big fan. Especially if you don't want to sell bitcoin in a bull market. Prevent capital gains. You're doing an investment and they have survived the worst of the market. They have proof of reserves. They're just a really great option and it's a really great tool. So check them out. They're right down in the show notes. Also, don't forget to check out the Financial Freedom report if you're trying to figure.
[01:03:05] If you want to stay up to date on the real news around the world on freedom and sovereignty and monetary and financial control, check out the Financial Freedom Report. Shout out to pubkey for creating an incredible set of tools for fixing the web and with the EU literally going KYC on everything on the web, this conversation has never been more important.
[01:03:29] Check it out, especially if you're a builder if you haven't checked out these tools. I have my pub key down in the show notes so you can find me up there when you go to see what you can build with this. And lastly, if you're trying to get your light health right, check out get Chroma Being meticulous about our light exposure and going basically all red light, which now I can just basically put on my glasses my nightshades being consistent about that has made a huge difference in my energy levels and my wife absolutely swears by the red light therapy. I got a 10% discount with code bitcoin audible. And also I've got just a other general like some affiliate links, some not of just things that, you know, people regularly ask me about bitcoin. Like if you're looking to buy bitcoin, I've got you can go to river.com, but I have an affiliate down which is actually a great way to help out the show if you want, but it's just the place that I recommend you buy bitcoin. Check them all out. Don't forget to subscribe. I think I've actually I'm going to do an entire series like this for guys takes because I've got like 20 of these like kind of core ideas that I really wanted to flesh out in a whole episode and it will help me kind of get it out of my head so I can prep for writing. And I've got a 2sats video coming soon, so stay tuned for that.
[01:04:41] Follow me on the Twitters and nostr and all that good stuff. And not a lot of people know I have a YouTube channel too. I've been slowly devoting more resources to that, so I'll mention it out there. I've got YouTube and Rumble as well if you're looking for the video. But with that we'll close it out. Thank you guys so much for listening. I am Guy Swan and until next time, everybody take it easy guys.
[01:05:18] There is a point in history of society when it becomes so pathologically soft and tender that among other things, it sides even with those who harm it criminals and does this quite seriously. And honestly, punishing somehow seems unfair to it. And it is certain that imagining punishment and being supposed to punish hurts. It arouses fear in it. Is it not enough to render him undangerous? Why still punish punishing itself is terrible.
[01:05:50] With this question herd morality, the morality of timidity draws its ultimate consequence.
[01:05:58] Friedrich Nietzsche beyond good and evil.
