8 December 2020

On today’s show we have tech titan and best selling author, Jeff Booth. Jeff is a thought leader in the technology space and offers some unique perspectives on what everything might look like in a Bitcoin world.



  • Work being done on the lightning network for payments.
  • What a deflationary world would look like.
  • What would the price of real estate look like.
  • How might the stock market get repriced.
  • Other technology impacts Bitcoin might have on policy.


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  • Jeff Booth’s book, The Price of Tomorrow.
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Disclaimer: The transcript that follows has been generated using artificial intelligence. We strive to be as accurate as possible, but minor errors and slightly off timestamps may be present due to platform differences.

Preston Pysh (00:00:02):
Hey, everyone. Welcome to our Wednesday release of The Investor’s Podcast, where we’re talking about Bitcoin. On today’s show, we have a tech titan who built a half a billion dollar business from the ground up, and he’s also a bestselling author, Jeff Booth.

Preston Pysh (00:00:15):
For anyone not familiar with Jeff, I would highly recommend you go back and listen to our episode, TIP 294, where we go through a lot of important ideas around Jeff’s book, The Price of Tomorrow, which is all about deflation and inflation and what’s causing these crazy policies we’re seeing all around the world today.

Preston Pysh (00:00:33):
On this episode, we’re talking more specifically about his opinions on Bitcoin. Additionally, we talk about what the world would look like if a fixed peg money like Bitcoin would supplant itself into the global economy. This was a really fun and interesting discussion, so sit back and enjoy the show.

Intro (00:00:49):
You are listening to Bitcoin Fundamentals by The Investor’s Podcast Network. Now, for your host, Preston Pysh.

Preston Pysh (00:01:09):
All right. So Jeff, I want to just start off. I sent you a text this morning and you immediately acted on what I sent you. I’m curious your thoughts. So, it was a Jack Mauler interview and I wasn’t real familiar with Jack. I’ve seen him on Twitter. I’ve seen a lot of people talk about how smart he is and how he’s a huge contributor to the space. But to be honest with you, I just didn’t really even know what he was working on. And I’m curious to hear your thoughts on Jack and what you listened to this morning.

Jeff Booth (00:01:38):
Yeah. I thought it was the whole Lightning Network and how fast that’s developing and is using Bitcoin as the second tier of payments and everything else. And I think before we can go into that, I’m surprised at how much innovation is actually moving into the space. You know because I have a piece coming out pretty soon that you read as well. You can project all of the innovation going forward, but even with realizing how much innovation is moving to Bitcoin, some of those things, how fast it’s moving, shocks you.

Preston Pysh (00:02:10):
I was listening to it and I was just like, “This is totally nuts what he’s doing.” And when we’re doing all these interviews right now, we’re all really hyper-focused on store value, protecting the meltdown of Fiat currency, but we’re not really talking about actually utilizing Bitcoin in a transactional way by going and paying for stuff at Target or wherever.

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Preston Pysh (00:02:34):
And after I listened to this conversation with Jack and what he’s building, he’s way beyond the store value piece and now he’s into the transactional piece and doing it with no friction at all and it’s instantaneous. I mean, I was just blown away at what I was listening to. It’s just insane.

Jeff Booth (00:02:49):
Yeah. And I think there’s a bunch of debates in the Bitcoin community, is it a store of value for the rest of the world? Will it move into the greater economy? And Jack’s working on moving it into the greater economy. And Bitcoin right now is more of a store of value.

Jeff Booth (00:03:04):
So, depending on governments’ reactions and what happens in a bigger picture, you can see all of the next steps that are going to happen in Bitcoin. If you look at the entire existing system and what the existing system has to do to protect itself or adopt Bitcoin, you can see all of the next moves.

Preston Pysh (00:03:24):
This is wild. It’s like watching a sculptor. When they start off with a big giant hunk of rock, they’re not there sculpting out the nuances of the nose, they’re knocking off all the big pieces and then they’re gradually getting it down to what you see as this finished piece of art and work. And when you look at what’s happening, I think that a lot of the arguments that we hear as to whether it’s a store of value, whether it’s a payment, I think the community is naturally knocking off the big chunks first. It’s just naturally happening. It’s not like it needs to be decided. We’re collectively, as a society, as a human race, just knocking off the large chunks that are the most important to solve the problem.

Jeff Booth (00:04:11):
Let’s look at this from, and explore this paper that I have coming out pretty soon. Let’s talk about it from what a business looks like. So, in starting a business, and I’ve seen tons of startups and successful and across the board. And I think to the general audience, most people think a startup that is successful tackles a giant problem that’s really wide and goes after everything that a monopoly goes after.

Jeff Booth (00:04:32):
And I can tell you, it doesn’t look that way at all. It looks exactly the opposite. It looks like the startup might have intention of going after everything, but they typically start something so narrow that everybody dismisses that. So, it looks at it kind of when you’re raising capital, at 10X advantage, 10 times advantage, in a narrow space that people would dismiss. When I look at Bitcoin as a store of value against gold, that’s what I see. It’s a 10X advantage against gold as a store of value that was dismissed not by the Bitcoin community.

Jeff Booth (00:05:08):
And if Bitcoin said early on or tried to compete at everywhere, it would have got shut down. People would have tried to shut it down earlier. And now that it’s moving so fast in that range and the network effect on it, now it can broaden. Now, what you’re talking about, what Jack’s talking about is the next broadening.

Jeff Booth (00:05:28):
You have to win the first hill first. And I use this example, Tesla started at the Roadster, with broad ambitions, but if they tried to do all cars, they would have been killed. Monopolies would have killed them. They have no amount of capital that they would have needed. Amazon started with books. Google started a free search before you could monetize search. All of the successful companies that go up and win against monopolies start in a narrow spot.

Jeff Booth (00:05:54):
It doesn’t mean that they’re going to win, but it gives them an outsize advantage. If they have a 10X advantage in a narrow market, then a lot of people talk about it. A lot of people adopt. And that what’s happened to Bitcoin, it’s a store of value first. And as it’s moving as a better store of value… By the way, I don’t think anything can stop it now from being the best store of value. And then it’s logical next step to do all the rest, right?

Jeff Booth (00:06:20):
But we don’t need to get over our skis on all the rest. And it’s just a function of a whole bunch of people, a whole bunch of entrepreneurial talent doing what Jack Mauler’s doing, what Square is doing, everything else. Realizing, “Wow, once this starts hitting, everything else is easier to build to those routes.”

Preston Pysh (00:06:39):
And I just wonder how many other people out there are like Jack that are building something that isn’t even on my radar or anybody else’s radar. It’s mind blowing. The part for me at the end of the discussion I was listening to when he was talking about MasterCard and Visa and how they’re getting their 2.9% or what businesses basically have to cough up for their costs for clearance is really what it is. It’s a cost to ensure clearance plus whatever profit is being made.

Preston Pysh (00:07:07):
And I mean, when you look at what he’s doing on Lightening, and it basically makes that go to zero, it was just this mind-blowing moment for me. You get immediate clearance, you take the cost to settle down to nothing. I mean, it’s just mind blowing.

Jeff Booth (00:07:23):
That’s why Square grew so fast. Because Square, instead of focusing on the big businesses that Visa was after, Square worked on lowering the cost so much. That’s how innovation works. It typically starts at the bottom where the technology lowers the cost so much that nobody else cares about that market because they can’t make margin on it.

Jeff Booth (00:07:41):
And so, a lot of entrepreneurs focus on essentially democratizing something through that piece, lowering the cost so much that they can open up a new market. And then by opening up that new market then they attack the bigger market from the bottom up.

Preston Pysh (00:07:59):
So Jeff, I want to talk about some fun stuff that you normally don’t get asked, but I’m going to throw this out here because I think it’s going to be fun to talk about. The price. So, right now we’re at $20,000 and the previous all time high was $20,000. I’m looking at it from a psychological standpoint and I’m looking at it from the cast of Wall Street actors that have now thrown their hat in the ring and said, “Yeah, I own this. The Stan Druckenmiller.”

Preston Pysh (00:08:28):
You’re seeing big firms, a hundred billion plus assets under management firms now saying, “Oh yeah, we think you should own some of this as well, anywhere between 1% to 10%.” We’re at $20,000. And I’m pretty sure you buy into the direction this is going in the coming year, call it a hundred thousand or whatever that number might be. What happens as we go beyond this, if it goes to $30,000? From a psychological standpoint, we’re seeing it on CNBC. Every single segment on CNBC is bringing up Bitcoin.

Jeff Booth (00:09:03):
Yeah. It’s amazing to watch, isn’t it? And that we’re still so early. Most people, if you talk to 10 people, they don’t really understand it. Right? So, I’ll give you a couple of for instances then we can talk about price, if you want to. So two of my friends run hedge funds. I won’t say the names, but are founders of hedge funds. And I’ve been talking to them about this for a long time, as you probably know, a long time. Before I wrote the book.

Jeff Booth (00:09:28):
And recently, both to said to me, “How do you buy this? What do you do?” Right? And these are giant hedge funds that are just now starting to take this on personally and thinking about it in their hedge funds. I’m part of an organization called YPO, Young Presidents Organization, and it’s not because I’m young anymore, but I’ve been in the organization for 20 years.

Jeff Booth (00:09:51):
Now, the organization, 25,000 members around the globe that run about $10 trillion, their businesses run about $10 trillion of the global economy. The CEOs. I’m speaking to multiple chapters almost every week. I’m speaking to the Tire Canada chapter next week on this topic because people care immensely. But it’s just starting. It is so early.

Preston Pysh (00:10:17):
Do you buy into the idea that a lot of the times Wall Street isn’t creative or doesn’t take a contrary position, especially when you have the types of people’s names that we are throwing around? And so, it almost becomes this, “You mean you don’t have Bitcoin inside your portfolio, at least 1%?” Kind of thing. It’s almost like it just jumped at 180 from being you’re this weirdo that has this to, “You mean you don’t have it?” Do you think that that’s happened at this point?

Jeff Booth (00:10:48):
Not yet. So, it’s still the leading adopters and it’s still… No, it’s going to come fast because as it runs up in price, as more and more people could accumulate it, you know what happens.

Preston Pysh (00:11:01):
What price do you think something like that would happen?

Jeff Booth (00:11:03):
Where are we talking? Do I believe it can be 21 or could I believe it’s over a $100,000 dollars in 2021? Yes, I believe that. Do I believe that that brings on many more people and it could go to the stratosphere? Yes, I believe that. Do I believe after that, does it correct? Yes, I believe that. And then ironically, if I think about this on the way through, there’s a chance that it just keeps going. I think a very low chance. I think it corrects along the way, kind of into the next selling. I follow this.

Jeff Booth (00:11:35):
What’s more interesting is what people will say when it corrects. Because people will say, and they’ll bias it because at the same time, you’re going to see governments starting to clam down KYC or something else. And they’re going to bias the reason for the correction to that and miss the entire next run up.

Preston Pysh (00:11:54):
That’s your base case.

Jeff Booth (00:11:56):
Yeah, that’s the base case. So, if you’re asking for me, I don’t think I will ever sell. I might take a loan against it sometime, but I don’t think I will ever sell it. I’m continuing buying right now and I’m not selling.

Preston Pysh (00:12:09):
Talk us through that because what you just said can be very taboo for some of the really hardcore max less out there that you would take a loan against it. So, there’s different companies out there that offer this type of service, talk us through how it’s even done. Because there’s people that are hearing this and be like, “Well, how would you even do that?”

Jeff Booth (00:12:27):
Yeah. So, I’m actually not saying right now. They own [inaudible 00:12:30] and there’s so much innovation coming to the space. It’s probably not even worth getting into. But imagine, take any other asset. I own a whole bunch of real estate free and clear. If I wanted a loan against that to be able to make investments, I can do that all day long. And so, that will exist on Bitcoin too.

Jeff Booth (00:12:49):
That’ll exist on Bitcoin if door one happens and it’s a reserve currency and each currency is pegged to it. If Bitcoin actually turns into what Jack Mueller is working on and everything else as well, it becomes the foundation and payment layer, then it’ll look different or it could look different.

Preston Pysh (00:13:08):
How do you address the concern that people have? Because this is so different than what we’re used to when it comes to Fiat money, as far as, if you don’t have the private keys and somebody mismanages that, is this a red herring now, has technology got to a point where it’s much safer than it was five years ago to trust other entities? Or do you think we’re still in the Wild Wild West and people need to really guard against trusting others to manage their keys?

Jeff Booth (00:13:36):
I personally would manage my keys. Anybody I talk to, that’s what I say to do. Over time, there might be better options, Grayscale. There are other options that are better than they were five years ago. And so, you can assume that there’s going to be better options moving forward. That seems like too much a risk for my risk reward tolerance. I wouldn’t want to put that. One of the things I love about this, Bitcoin, is they are your keys. I love the decentralized nature of this.

Preston Pysh (00:14:07):
So, let’s pull on that thread a little bit because Brian Armstrong, the CEO of Coinbase, he came out with a tweetstorm saying that there’s talk that there might be some type of Google Documents about self-custody. And I’m just curious to hear some of your thoughts on that and where you think some of that might be going.

Jeff Booth (00:14:28):
I suspect that there’s no way people are going to shut down self-custody of this. If they did, it would be like closing on ramps to Bitcoin and they’ll just move, right? So, in game theory, there’s just not going to be enough countries that are going to because, you know this, right? Number one, if they did that, I don’t know how they would do that. How do you make that happen? Number two, if they did that, you’d get on a plane. I know I would.

Preston Pysh (00:14:55):
Yeah. I think the law is only as good as the enforcement behind it. Right?

Jeff Booth (00:15:00):

Preston Pysh (00:15:01):
So, one of the things that a lot of people wanted to know, because I sent out a tweet that you and I were chatting. I think there was almost 200 questions that popped out. But one of the common themes that I saw was people were like, “Explain what this new world is going to look like.” If anything, if I could explain it in physics terms, I think what they’re asking is, so we’re about to be sucked into a black hole. What’s it look like on the other side of the black hole or the light side of the black hole? What is this world look like? Assuming Bitcoin does reach the state of adoption that we’re using it, not only as a store of value, but even as a payment layer, what does that look like from a social, political, workers, unemployment, business owners, residential, real estate, like all that kind of stuff?

Jeff Booth (00:15:50):
Oh, just that question. That’s all? What does the whole world look like under an entirely different paradigm? By the way, that is the most important question, because if you can actually paint a picture, today the existing Fiat monetary system, structurally there’s no way to save it against technological growth, right?

Jeff Booth (00:16:09):
So, if you just looked at innovation itself and if you said, society keeps learning and makes better and better products more and more, unless you’re creating entirely new industries that are bigger than the ones that you’re destroying. And then everything you’re talking about in an entrepreneurial process has to be deflationary. Now you add technology to that and it becomes exponentially deflationary.

Jeff Booth (00:16:33):
So, you know that that’s the thesis of my book and it’s coming up against monetary policy. The monetary policy said, “Hey, I just cannot believe people actually can defend it.” Because all it is is I’m going to cheat. I’m going to just keep on printing money. And so, just pause there and think about that. I know for Bitcoiners, they know this, right? But most of the world doesn’t know this.

Jeff Booth (00:16:55):
And so, they actually accept that how much cheating or printing of money is happening to keep them happy. And inflation is just a tax on the people that are most unable to pay it.

Preston Pysh (00:17:08):

Jeff Booth (00:17:09):
So, inflation is wage deflation. So, if I actually wanted to play a game and drive inflation really high, and wages don’t keep up with that inflation, then I can actually extend the game of technology because wages become less of the entire picture for longer and drive inequality. And then people come back to me and say, same government and say, “Okay, fix the problem you created by taking more of the money through socialism or something else and redistributing it.” That’s where we’re going.

Jeff Booth (00:17:38):
I haven’t seen, I wrote the book, now over when I wrote it, it was now over two years ago, it was released in January and it predicted all of these events. But I haven’t seen yet, not one, hard take down of I’m wrong. That’s kind of surprising that it’s a best seller in multiple countries.

Jeff Booth (00:17:57):
I’ve had pot shots, just same as you get in Bitcoin and everything else, but I haven’t had one take down. Because fundamentally, from first principles, these systems cannot work together. So, you’re either voting and cheering for manipulation and thinking government can fix it all through more manipulation or you need to find another way.

Jeff Booth (00:18:19):
And so, the beautiful thing about Bitcoin is, is it, is that other way? I try not to get too deep in the argument even in Bitcoin because there are attempts that KYC, [inaudible 00:18:32] going through right now and everything else. Here’s the biggest point if you’re in the highest level.

Jeff Booth (00:18:37):
If Bitcoin emerges as a store of value that is what we’re talking about, and when I say if, when, it will, there’s no doubt in my mind, everything else fixes anyways. It’s a forcing function. Governments get smaller because they can’t get bigger. Everything that is enabled by technology instead of broad-based abundance is forced through that happening. And if governments tried to stop it, it will move into the second layer.

Preston Pysh (00:19:06):
It’s more of a function of how long is it going to take them to figure out to transition into this new set of rules and new environment so that it brings the least amount of pain to the populace that they’re all presenting? That’s the real question, right?

Jeff Booth (00:19:21):
That’s it. When you’re talking, some people get so anxious about those people, and there are bad actors in any system. There are probably bad actors in Bitcoin. But it’s the system itself that’s trying to protect itself. There’s actually also a lot of really good people. There’s a lot of good people in government that actually probably own Bitcoin themselves and are going to start pushing that forward because they realize it’s actually the only way.

Jeff Booth (00:19:46):
Because there are two ends of the spectrum. We vote for more government control and totalitarianism on one side or the free market driven by Bitcoin on the other side. And those are the two ends of the spectrum. And so, no matter what happens on Bitcoin as a store value as it moves, it’s going to force the free market. So now let’s talk about some of the downstream consequences and everything else.

Jeff Booth (00:20:08):
We don’t see, we get caught up in a loop because we’re measuring all of our outcomes by the existing Fiat monetary policy and so is everybody else. And it’s really hard to say what would it look like in a new world. And because you have to hold two contradicting thoughts in your head and investigate from both concurrently and then see it. But it’s really hard for people to do.

Jeff Booth (00:20:33):
So, that’s why people get tricked into my house always goes up without realizing that it took $185 trillion of stimulus to make that happen or without asking the next question. It’s going to take 185 trillion to make it happen again. So, if you believe that that stimulus is coming, then housing will still go up. If you believe that stimulus is going to come without taxes going way up or the next step of what happens, then housing might be a good place. If you don’t, there are better investments, Bitcoin, I believe is a better investment.

Jeff Booth (00:21:07):
So, now look at what would happen. Some of the, I call them false presence. Today, education is free. I put a tweet out on this. And when you and I went to school, it wasn’t free, but today it’s free. And I mean that we can learn anything from anyone, anywhere through an internet connection.

Jeff Booth (00:21:27):
And I mean, top researchers, top everything else. So if you are the curious, driven individual, I can see by your bookshelf behind you’re that person. So am I, right? So, why do we spend all this time in school, 12 years in school and then four years, and then four years paying all that money and time. And we complain of what the cost of schooling is? Why do we do that when it’s free? We do that from a past reality where I grew up and our parents grew up because that was the way to get the better job. That’s changing really fast.

Jeff Booth (00:22:00):
I can tell you I’ve hired thousands of people. And I can tell you who I would hire every time. So, I’m not saying somebody that’s not accountable, I’m not saying they’re not driven, but a driven, curious person who’s constantly learning, that’s the person I want on my team. And so, it’s free today. So, just where do you want to spend your time? And you’re going to see a whole bunch of things we thought cost all this money, but don’t anymore.

Jeff Booth (00:22:25):
And we built mausoleums to be able to charge people more money for all of that to be able to keep the system going to keep inflation going at all costs because if it started to crumble and we put tons of debt in it to keep it going, because if it started to crumble, the Wizard of Oz, you’d pull the curtain back and you’d see what was there all along. And so, that’s where the society is certainly now.

Jeff Booth (00:22:49):
So, there’s a whole bunch of those things that we don’t even look at. Here’s another one, I think it’s important for the Bitcoin community. It’s even important for all of the communities. Governments right now are going, and I don’t actually care what side of the argument you’re on in global warming. I don’t care about that.

Jeff Booth (00:23:07):
And so, I personally believe it is a problem. But even if you believe that it is not a problem and everything else and it’s overdone, I’m willing to give you something on both sides of that that will peak people to open their eyes. So, no matter what side of that issue you’re on, you’re on the global warming is a problem we have to solve it. Global warming is an order of magnitude bigger problem because of money printing.

Jeff Booth (00:23:29):
If inflation is required and you lower the cost of money to make sure you get inflation, then you have to constantly get more and more things and more and more things and more and more oil, more and more, correct? Not real cost of oil. They’re not in real terms, right? And now you need more shipments. You may need more of this. You need more labor, you need more everything else, all to keep it going.

Jeff Booth (00:23:52):
And then you have a whole bunch of money that’s being printed to drive that process. And it is deflating on the other side. It is taking technology and progress and everything else. So, think that through. So, energy is one of these deflationary forces and solar and everything else in time, it’s cheap and more innovation goes there. And everybody in the energy thinks, “Wow, I’m solving the problem. I’m making the world better.” What does government have to do to keep the inflationary system going?

Preston Pysh (00:24:20):
They got to print more.

Jeff Booth (00:24:22):
Exactly. And they have to print double as much to be able to stop what you’re doing. So, it’s a system that’s creating the order of magnitude problem to the environment. Not any of the BS contributes to everything else. But all of those costs would fall. We would not believe how far prices would fall without manipulation. It’s so hard to even understand.

Jeff Booth (00:24:43):
And so, it’s a transition to that new world because they’re totally different systems. This is really hard to fathom. And so, that’s why people, the NMT, everything else when you’re talking about that, really what you’re talking about is a whole bunch of people can’t pay for their food, can’t pay for their housing, and they’re going to go on the street.

Jeff Booth (00:25:00):
And in the U.S right now it’s like, if there’s not fiscal stimulus, you’re going to see it’s crazy what’s going on. So you have a whole bunch of people demanding from government to fix the problem the government created with more of the printing that caused it in the first place. But when you look at those people, they have no idea this [inaudible 00:25:18]… And they’re struggling and everything else. And all of those prices shouldn’t be anywhere near where they are. Now I’ll take the opposite example. If you’re the existing system, what do you do?

Preston Pysh (00:25:28):
They have to supply the liquidity to the new transition system, right? They’ve got to keep doing what they’re doing.

Jeff Booth (00:25:36):
Yeah. And you know it’s creating all this downstream consequences. So, if you can print money and lend it out, if you can just make up money and lend it out at rates, isn’t that usury?

Preston Pysh (00:25:47):
Oh, yeah.

Jeff Booth (00:25:47):
Because it’s an infinite interest rate. So, if a government can create money for free and then lend it out, isn’t it just creating money out of nothing to any interest rate on it at all, is usury? Because people are looking individually at a country like the U.S and monetary policy of the U.S. Okay, well, so what if it was a different country?

Jeff Booth (00:26:06):
Let’s say it’s China and I want to expand The Belt and Road. Oh, great. I’m going to make up a whole bunch of money and I’m going to lend it to a whole bunch of people, charge them interest, and I’m going to own those countries through my economic engine of manipulating money.

Jeff Booth (00:26:22):
So, if people could rise up a level and see this is going on all over the world and it’s creating these powerhouses that have a concentration of power and risk to the world, it would see that the U.S’s best bet might be to adopt Bitcoin.

Preston Pysh (00:26:40):
It’s just a matter of how long they figure that out.

Jeff Booth (00:26:43):
If you think about you want to solve the China problem, you want to move quickly there. The U.S as a society was founded on individual rights and freedoms. The more people in that society think like that than most places in the world. If you were to think of a government that would think, “Okay, we’re going to lead in the new currency regime around the free market.” It might be the U.S.

Preston Pysh (00:27:09):
I get asked this question a lot, which is, so what does this look like if we all go to this Bitcoin standard, right? I always like to go back to my roots of value investing and valuing a business when I’m thinking about things. And one of the things that I’ve noticed really quickly just with my own company and then looking at other companies like Michael sailor’s company, if you’re making free cash flows, you can stack Bitcoins onto your balance sheet. If you aren’t making free cash flows, which is for a lot of companies out there, you’re not going to be able to buy these things.

Preston Pysh (00:27:43):
And so, when we just look at Michael’s performance of his company, just in the last quarter, and I think that this run we’re in is just getting started. So, I think that maybe this is a conservative performance of somebody who has turned Bitcoin into their unit of account for measuring retained earnings. That’s what Michael did with his $425 million. He’s doubled it in a quarter effectively, right?

Preston Pysh (00:28:08):
I mean, he’s basically taken his 25 years or however many years it took him to retain that $425 million. Let’s just say it’s 25 years. It took him 25 years to retain that much retained earnings. And in one quarter he doubled it. I find that fascinating. But the concern, I think, is how many companies would you guess are not profitable or not having free cash flows in order to retain earnings and do this? I would guess it’s half of the businesses.

Jeff Booth (00:28:37):
Yeah. I was going to say probably at least that, but I’m going to back up. Number one. What makes you such a great advocate in the Bitcoin community besides your even temporary everything else is you were a value investor who’ve done deep enough to realize, wow, whole bunch of what I’ve been taught is wrong, at least in this new paradigm.

Preston Pysh (00:28:58):

Jeff Booth (00:28:59):
It’s not wrong. It’s just the paradigm of printing money has changed the paradigm for everybody else and that people aren’t seeing it. So, from our first conversation when you talked about my book, wow, okay. Here’s somebody who’s a perfect fan, understands everything and then crosses the chasm and understands intellectually curious enough to look deeper on what’s happening. Michael Saylor. Same thing. I love what he said. I was prepared to get killed, it go down, people take it out on me. I was prepared. I bought packed shirt. I told people what I was going to do. I overpaid for a stock too as if I wanted to trade out, but I was going to do it.

Jeff Booth (00:29:35):
And I love people who had that accountability to look deep, to understand it at that level and then make a decision. And it might seem like a bold decision, but it’s actually the best decision you could ever make. And so, that you’ve done that, he’s done that and everything else. So yeah, way more companies are going to do this and the ones that can will, so will people, eventually so will governments.

Preston Pysh (00:29:59):
Jeff, the reason I was bringing it up is because I’m looking at it from an employment standpoint. So, if you and I both agree that the number of companies that are able to do this is half of the companies that exist today. And then whatever employees that are associated with the other half that aren’t able to do it, does this imply that we’re going to just have massive unemployment when we transition into a Bitcoin standard if everything that we’re saying is valid and true and plays out in the direction that you and I both see it playing out, which is one potential, right? I’m sure other people are hearing this and thinking that this is crazy talk. But the way you and I are seeing it, we’re pretty much implying that to be true.

Jeff Booth (00:30:42):
Well, I’ll go one step further because you went through the book. So, when I say inflation and what the governments are doing is they’re trying to protect jobs. Look at the Fed mandate, but they’re doing it and they’re making the jobs go away faster. If you do this as a government, if you think you create jobs as a government and you create jobs by manipulating money supply, then a whole bunch of companies will take you up on it. And those companies that take you up on it will be left needing assistance forever. Zombies of wards of the state.

Jeff Booth (00:31:14):
They’ll have jobs, everything else, but if you cut off the money printing, they’re dead. And on the other side, the companies that don’t pay that will remove labor as fast as they can, because otherwise they’ll need it forever.

Jeff Booth (00:31:28):
So, if you let the free market work, that abundance, yes, labor isn’t needed at the same rate, but prices would fall to match that paper not needed at the same rate. And they would fall as fast. People would be blown away how fast prices would fall because entrepreneurs attack the industries to be able to make them more efficient. You would drive things free. You drive them lower and lower costs and your time would expand.

Preston Pysh (00:31:56):
So, there’s a lot of business owners that are going to lose their businesses through this.

Jeff Booth (00:32:01):
So, that is going to happen anyway, changing the money supply doesn’t change that, it changes who controls who.

Preston Pysh (00:32:08):
A lot of Bitcoiners are giving high fives right now hearing you say that.

Jeff Booth (00:32:14):
The businesses shouldn’t be there. If you require a never-ending government stimulus or just support to stay in business, it’s not a free market.

Preston Pysh (00:32:22):

Jeff Booth (00:32:23):
I’ll give you a personal story. In 1981, my parents lost everything. We had tons of wealth, real estate, everything else. And my parents were both in real estate. The interest rates went through the roof to 20 odd percent in Canada and everything was gone. And my parents had to restart. And I know that as an 11 year old kid, what that did to our family, to what it felt like as a family.

Jeff Booth (00:32:52):
And what drove that on the other side was the same thing; manipulation of money’s interest rate and now let’s get ahead of it. And a lot of people don’t see what’s happening, right? So they take out more and more loans. They take out more and more debt because it’s going to go up forever. And then when things reset.

Jeff Booth (00:33:09):
So, even though I said those businesses shouldn’t be there, I understand the pain that’s coming to society. And I feel terrible about the pain. But the pain isn’t caused by a whole bunch of people buying Bitcoin. The pain is caused by a manipulation of money.

Preston Pysh (00:33:24):
30 years of decisions that proceeded all of this. No, I think anybody who’s listening to this knows that you’re not saying it is good they need to fail, I think everyone can definitely sense that the sentiment is this is going to be a very painful experience for so many people and the one thing that’s going to allow all of us to get through this. Whether you got Bitcoin or not doesn’t matter, it’s we’ve got to take care of one another as humans and have humility for each other and be kind to each other. That’s the only way we’re going to get through this.

Jeff Booth (00:33:56):
Exactly. There’s a whole bunch of people in Bitcoin that are going to be celebrating the price rising and everything else and they should. And the thing I love most about Bitcoin though is I say when it works, it forces accountability in a free market. So, there should be a whole bunch of people that instead of wanting MMT, they should want this to work because that would be the best way to drive abundance into society.

Preston Pysh (00:34:21):
So, for the typical person, let’s just say they have a $300,000 house, and we’re in this new world with this new environment. They bought it at 300,000. They have a huge loan on it. Let’s just say they have 10% or 20% down on the house. So they’ve got a lot of interest to still pay on the house. It’s a fixed rate mortgage at a very low interest rate. Let’s just call it three, three and a half percent or whatever denominated in Fiat currency, very key and important point.

Preston Pysh (00:34:56):
You should see the look on both of our faces right now. Talk us through the price of the house. Okay? They bought it for $300. What happens to the price of the house? What happens to those payments that they have to make on this house? And then talk to us about the demographics of the people that are able to make payments because they have a job versus not even having a job to continue to make payments. What do those people have to do? Do they have to sell or whatever? Just walk us through some of that.

Jeff Booth (00:35:23):
We’re comparing two systems again. So, what is likely going to happen? And there’s going to be a ton of easing. I cannot see any world where there’s not more and more easing. And so the loan with more easing in real dollars will go down because it’ll inflate away. But that’s going to create more pain, a lot more pain. And one day the music’s going to stop. You’re going to have this crazy, it’s going to eventually move into hyper inflation at some point. So, that’s what I would say my base case is that’s what’s going to happen.

Preston Pysh (00:35:56):
And so, if you’re paying back your loan with money that’s hyper-inflating or de-valuing at such a pace that it’s somewhat unfathomable and you had a lot of debt on this house like this person I just described, you’re winning in a major way.

Jeff Booth (00:36:10):
You’re winning in a way. In fact, that’s what’s created most of the paper wealth and all of people that think that they’re winning, but that’s what’s happened. All of this has been happening for the last 30 years. And if you’re into these asset classes here, it’s a one-way ticket to win. And if you’re not in those asset classes, you’re getting killed. Your wages are going down in real terms and you’re not able to catch up. So that’s what’s happening.

Preston Pysh (00:36:35):
And effectively, this is loan forgiveness.

Jeff Booth (00:36:39):
It’s loan forgiveness. So, it concentrates that wealth further. And remember, any side of this win, there’s a loser. On the other side, the loser is the person working for wages. And even if you say to that person working for wages, “Here, we’re going to give you MMT.” They’re still a loser, but they’re still losing out on that equation because their assets are inflating faster in that path.

Jeff Booth (00:37:03):
A whole bunch of people might believe, “Wow, this is going to be really great for me.” But it’s not. Now, the other argument, if you just let it deflate right now. So if you didn’t print any more money today and deflation took hold, that loan that you’re talking about would go up and up and up and up, you would never be able to pay it back.

Jeff Booth (00:37:24):
The house would fall in price and the loan would go forever higher as everything deflate at real terms. So, that’s why these systems are completely different and the path to the new system. It’s going to be messy.

Preston Pysh (00:37:38):
Then what you’re describing is if the loan is denominated in this deflationary currency, but the situation we have today is everyone’s got their loan denominated in the old currency that’s going to continue to be debased relative to the new currency.

Jeff Booth (00:37:55):
Yeah, no, I guess what I’m getting at is let’s just say there is no Bitcoin and deflation took hold. It’d be disastrous. Why fundamentally that can’t happen is there is no money in the system. It’s all based on credit. So, people would see there’s no money in the system and it would collapse and it would collapse all the banks and the entire system would reset a different way. So I don’t expect that to happen.

Jeff Booth (00:38:16):
So, that transition to Bitcoin. You could have a whole bunch of people could use this to acquire Bitcoin. And over time, you could transition to a system that is a forcing function. But at some point, if there’s going to be tons more printing, and as a by-product of printing, I would imagine there’s going to be a whole bunch of people taking on more loans to be able to do this. And there’s a whole bunch of people thinking, “Wow, this is great because if there’s a whole bunch of inflation, I can pay back that loan with cheaper dollars tomorrow.”

Jeff Booth (00:38:48):
So, the whole problem is getting worse by an order of magnitude at each step, right? We’re kicking the can down the road and we’re making it really, really bad. So, that reset you see sometimes on the winter is coming, winter is coming.

Preston Pysh (00:39:03):
How does a deflationary world look, or help, or not help an entrepreneur?

Jeff Booth (00:39:08):
I don’t think it makes a difference. What I would say is entrepreneur goes and sets, I have this point of view on a market that looks inefficient and I’m going to make it better. And remember, an entrepreneur only wins when they provide value to you. I think that’s where people miss that part of the free market. All of the money is destroyed. The entrepreneur’s time is destroyed. Everything else, unless they provide value for society.

Jeff Booth (00:39:38):
So, it’s not those bad entrepreneurs trying to hurt people. They only win when you’re providing value better than the status quo today. So, that doesn’t change at all. Human innovation and drive and everything else, it doesn’t change at all. In fact, that’s the point.

Jeff Booth (00:39:55):
Imagine now as a value investor and you have a bunch of Bitcoin and you have cashflow from your businesses and everything else. And an entrepreneur comes to you and says, “I have this idea. I’m going to go up against this.” Would you not give it a look? If you like the idea, would you invest that money?

Preston Pysh (00:40:12):
Absolutely. Yeah.

Jeff Booth (00:40:13):
It doesn’t have to be credit money. It could be from your balance sheet. I do it all the time. I make these investments all the time. I help entrepreneurs get to the next step. I know the path well, right? So, it doesn’t change that one iota.

Preston Pysh (00:40:26):
So, earlier you were talking about this 10X advantage, and that’s something that you really look for when you’re investing in a startup or identifying a startup that has potential to succeed in a very difficult and competitive marketplace. I don’t think you and I have ever talked about this before. But when I look at Ethereum,, it fails this test for me, right?

Preston Pysh (00:40:51):
And let me state my opinion and I want you to shoot holes through it. I want to hear your thoughts. So, when I look at Ethereum, versus Bitcoin, Bitcoin’s case for why it’s a 10X value-add to society is it’s putting a peg to a global economy that has no peg anywhere in sight for any country anywhere.

Preston Pysh (00:41:11):
So, that’s a huge value-add. When I look at Ethereum,, it doesn’t have a limit on the number of coins that are there, but it does this “smart contract” thing. So the big buzz right now is this de-fi, decentralized finance. I don’t need to have a decentralized platform to own stock securities.

Preston Pysh (00:41:35):
Last time I checked, Robin Hood was doing this completely for free. A person can open an account. And the cost to conduct trades for equity is slim to none right now because it’s so competitive. So, I guess I just don’t understand what value captures being created with this de-centralized platform, which we could go down that path, whether it’s even de-centralized or not.

Jeff Booth (00:42:00):
It is not.

Preston Pysh (00:42:01):
Yeah. So, give us some of your thoughts and do you agree with my line of thinking, do you see it differently? I’m really curious to hear your thoughts on this.

Jeff Booth (00:42:09):
I wrote the article that way, and for those it’s coming out in Bitcoin Times in a couple of weeks, but I wrote the article that way to essentially say that. I didn’t want to point to the Ethereum or any of the other tokens rather, but innovation like this, to be able to capture value has to have a 10X advantage. Because otherwise you just never get seen. You don’t break through the noise of the existing clutter.

Jeff Booth (00:42:33):
Bitcoin was that 10X advantage. And now where Bitcoin is, and it’s building a network effect more and more and more and people onto it, unless you have a 10X advantage to Bitcoin, no chance. And Ethereum doesn’t have a 10X advantage to Bitcoin. So, there will be a whole bunch of other clients, maybe I’m wrong on some of them making… And in short-term, some of them will do well in the short-term there’ll be hype cycles, some of them will do really well.

Jeff Booth (00:42:58):
But over time, I suspect that Bitcoin continues its March and things are pegged to it and everything is built off of those rails. That’s where I would say it’s going. And that article that I’m talking about effectively lays out that case. It would be really hard to create another 10X.

Jeff Booth (00:43:17):
So some people, before I go on from here, even though in the book I talked a lot about network effects and a lot of people have been looking at network effects, why that makes such a difference. And sometimes they’ll use MySpace Facebook as an example of a network effect that was overtaken by another company within network effect.

Jeff Booth (00:43:34):
And what they miss is a key ingredient of that. And that key ingredient is the 10X advantage that Facebook had over MySpace was not this social networking tool. It was built for mobile at the same time Apple came out and people wanted it on their phone and my space didn’t have it. So, it just moved really fast before MySpace could capture ground. That was the innovation.

Jeff Booth (00:43:59):
So, it was a 10X advantage because it’s around you all the time. A lot of people think it was both just on the web. It wasn’t. Look at when Facebook came out and look at when iPhone came out okay, or when mobile came out.

Preston Pysh (00:44:15):
And I want to highlight something that you had said there that I think is important for people to hear. You said in the short term, maybe Ethereum would outperform Bitcoin, which I completely agree with you on. It doesn’t mean that it fundamentally wins in the long run. But if a person who’s listening to this, let’s say they’re trader or they’re somebody who buys something with a time horizon of one month. And they’re just constantly in and out and all that kind of stuff. Could Ethereum outperform Bitcoin? Of course it could.

Preston Pysh (00:44:43):
But I think the conversation you and I are having is one that’s of a very long duration and something that you can pretty much buy and just on your hands. Yeah. And that’s ultimately getting at the root of a fundamental problem that’s trying to be solved. Do you have any other comments on other alt coins that are out there or concerns or things that you find really important that Bitcoin does that may be these other ones don’t do?

Jeff Booth (00:45:08):
So, Bitcoin to me is the only one that I care about.

Preston Pysh (00:45:12):
Because of decentralization?

Jeff Booth (00:45:17):
Because of decentralization. Because of its use case and then where that takes it as a use case. I’m not saying there’s not going to be a whole bunch of innovation in this space. I’m not saying that at all. I look at other big cases, I’ll look, but I have not seen anything that matches Bitcoin.

Jeff Booth (00:45:32):
Remember, if you had something with a 10X advantage to Bitcoin, you would know it. It would take over everything so fast. And the rate of growth would be so fast because that’s the point. They cut through the clutter. They don’t need marketing. Google didn’t need marketing, Amazon in the early days didn’t need a lot of marketing, but your 10X advantages cut through the noise and they don’t require all of the marketing because they’re so valuable to users. They just take off.

Preston Pysh (00:45:59):
I feel like you’re talking about ripple in the Wall Street journal article or ads that they run.

Jeff Booth (00:46:07):
I’m not. I’m not.

Preston Pysh (00:46:08):
Am I putting words in your mouth, Jeff Booth?

Jeff Booth (00:46:10):
It would have. Put it this way. I could be, but I’m not. Here’s the thing. I understand why some of those businesses are doing it. If you were the business and you’re trying to succeed, I get why the business is doing it. All I’m saying is a fundamental breakthrough in technology, what I invest in, what I spend my time on, I look for 10X advantage for a certain reason. And I just explained some of those reasons.

Preston Pysh (00:46:34):
Love it. So, I’ve heard this argument a lot, in fact, funny as it is, and as ironic as you could possibly get Mark Cuban used this argument against me on Twitter one time. Don’t you think it’s an issue that BTC is highly concentrated into the hands of a few. On top of that, if large companies are now putting it on their balance sheets, doesn’t it simply keep the same problems we have today?

Jeff Booth (00:46:58):
I actually cannot believe people who say that. I’ve ever heard of the same thing. Because it’s more broadly distributed than the current economic environment is today already. And as a forcing function, people will sell it. As it hits new highs, people will sell it and more people will come on.

Jeff Booth (00:47:14):
You want the most fair thing for humanity, fix money. This fixes money. And that downstream changes just about everything else. So, I have a hard time when even though if it looks like that today, I can imagine in the early days, people could say, “Yeah, Bitcoin looks concentrated.” It’s less concentrated today than the existing financial system.

Preston Pysh (00:47:36):
The argument that I like to throw out is, so let’s fast-forward. Let’s say that we have this mass adoption and that you do have a lot of Bitcoin in the hands of a few. I know personally I would be out there looking at equities, trying to find something that is giving me a better value for all the free cash flows that the companies are kicking off and then I buy that and now somebody else has my Bitcoin while I have this equity. Right? And that’s how it gets redistributed.

Jeff Booth (00:48:00):

Preston Pysh (00:48:00):
Yeah. I don’t know when Mark said that to me, I was just like, “This is the richest complaint I think I’ve ever heard from you.” But hey, it’s a fun space there on Twitter, I’ll tell you.

Jeff Booth (00:48:15):
I have a really hard time. And that is one of the things that when I think about it, if a whole bunch of your wealth is because of monetary policy that hurts other people and you know that, it’s so incongruent to stand up there and say, “I’m smart.” Because it’s not from smarts. It’s not from anything like that. It’s from manipulating money. And a whole bunch of assets went way higher than they should have. And if you held assets, you won.

Preston Pysh (00:48:45):
The difference for you, Jeff though, is you’re looking at this and you’re saying, “There’s something systematically broken with the world right now and I want to try to understand what it is.” Where I don’t think necessarily some of these other people were saying, “I don’t think there’s anything wrong with this economy that we have.” That’s not the issue, it’s that this person or this policymaker made a bad decision. And that’s what’s the root. I think their diagnosis for root cause is the issue.

Jeff Booth (00:49:11):
You’d have to be pretty blind not to see the root cost right now. Right? The Fed comes out every time and says, “Yeah, we want to print more money and we have to have inflation. And so, we’re just going to make up more money,” right. And all over the world, we’re just going to keep printing it. So, you’d have to be living under a stone not to be able to see root cause.

Preston Pysh (00:49:29):
Touche. I have nothing. You’re exactly right. I don’t know how you could debase the money by 20% back in March and just not think that there’s any type of longterm impacts to that.

Jeff Booth (00:49:39):
In 2009.

Preston Pysh (00:49:39):
I know.

Jeff Booth (00:49:40):
It just keeps on getting worse.

Preston Pysh (00:49:42):
Let’s go to this next question I’m looking at. Debt markets. Many Wall Streeters are buying long-dated bonds because they know the central banks are just going to step in and bid the price. What are your thoughts on that trade? Because I have some really strong opinions about this trade. I want to hear your thoughts on this trade.

Jeff Booth (00:49:57):
I don’t think the Wall Street traders are in there for the long bonds. I think they’ll trade out of them before their term. But in the short term, I think they might do well. It’s exactly the same trade as we’re talking about on the tokens, right?

Preston Pysh (00:50:12):

Jeff Booth (00:50:12):
So, you’re talking time horizon, I’m talking time horizon and in a trading mentality, you might not care. So, at some point, that trade is going to unwind really badly and the counterparty risk and what’s in it will just completely unwind. Remember when the oil went to negative? So at some point, that’s going to happen. At this point, I would say it’s highly likely that rates go negative.

Preston Pysh (00:50:38):
Totally agree.

Jeff Booth (00:50:39):
And so in the short term, there’s a lot of that trade would do well, in the long-term it’s going to fail spectacularly.

Preston Pysh (00:50:46):
Even though I think the probability of making money in the short term on this is, I mean, practically a guarantee, I just can’t bring myself to do the trade because of just some type of, I don’t know, moral high ground. I know that sounds really like fruity for me to say, but I just don’t want to participate in that crap.

Jeff Booth (00:51:08):
Is one of the reasons you’re one of my favorite people in Bitcoin. Because I think you and I share that type of philosophy at a higher level. [inaudible 00:51:17] does, there’s many others that do, but you care about something deeper and what things should look like. We can make a lot of money. I would rather make the money and feel good and go to sleep at night. I don’t need any more money. What do you spend your time on? You shouldn’t spend your time on things that advance causes you care about.

Preston Pysh (00:51:39):
Yeah. I think it’s hard for a lot of Wall Streeters because they’re managing other people’s money. They have to perform, right? They have to put some yield on the sheet at the end of the quarter, end of the year, for the people that are entrusting them to give them returns. So, I can understand. And I don’t want to sound like I’m on a high horse and Wall Streets. No, I understand their incentive structure, I understand they have to retain money for their clients.

Preston Pysh (00:52:03):
But I guess for me I’m just looking at it and just like, “How the heck can somebody buy this garbage when they know it’s a completely rigged game, and you never know when all the cracks in the dam burst.” Like good luck timing that one because it’s not going to happen slowly.

Jeff Booth (00:52:18):
Yeah. And you’re right. But in the short term, it’s probably a good trade.

Preston Pysh (00:52:24):
So, when does that blow up and what blows it up? Because I’m pretty sure I know what’s going to blow it up. It’s what we’re talking about. Right?

Jeff Booth (00:52:33):
It’s interesting. It is what we were talking about. So, what would the normal pattern look like without Bitcoin? There’d be debt reset. Ray talks about it and what that looks like. And he talks about the beautiful de-leveraging. I completely disagree with his beautiful de-leveraging thing because it’s looking at a historical format to how governments get out of this.

Preston Pysh (00:52:54):
And Jeff, I think it’s important to note, it’s a historical format where not every single country in the world is polarized in the same situation like we have today.

Jeff Booth (00:53:04):
Exactly. We’re not all governments are, it’s one government.

Preston Pysh (00:53:05):
That’s right.

Jeff Booth (00:53:05):
So now how do all governments get out of it? It’s virtually impossible to pull that off. Not only that, you have technology moving at a rate that is so unbelievable that people aren’t looking for. So, most of the deflation is in front of us, not behind us. And it means that beautifully leveraging or the amount of printing would have to be a staggering amount more than anybody thinks that it would be to keep up with the rate of deflation.

Jeff Booth (00:53:32):
And that rate of deflation is going to take those jobs and everything else. I could say in a normal world and before Bitcoin and everything else, you could predict this forward and say how long this would take. I think the pace of what is happening in Bitcoin is going to be a forcing function. I don’t want to put a time on this yet, but that is the thing because more people are opting out of the current currency structure. And as that starts to really drive on the network effect, the existing currency structure unwinds faster.

Preston Pysh (00:54:03):
This was probably three or four weeks ago. And this is on CNBC. The head chief investment officer for BlackRock, for fixed income at BlackRock was talking about how he thinks Bitcoin has a potential to start to replace gold. And I was thinking about it and I was like, “Why is their fixed income guy on here right now talking this and not their commodities guy on here talking this?”

Preston Pysh (00:54:29):
I found that fascinating. And when you think about what’s really going to blow up, like sure, it’s going to take some of gold’s market share whatever. In my opinion, that’s small potatoes. And it’s funny you hear the Winklevoss twins keep running around talking about their valuation is based on taking gold’s market. I’m looking at that and just being like, “That’s not even the tip of the iceberg of what we’re talking about.”

Jeff Booth (00:54:52):
Why is that 10X foundation then the first thing? Gold is just the first hill and it’s going to blow through that and then everything else. And by the time it gets to that, lookout.

Preston Pysh (00:55:02):
So, I’ve got an opinion. I want to hear what your opinion is. What’s the magic number where everyone in fixed income starts going, “Oh crap.”

Jeff Booth (00:55:12):
Probably around 150,000. What’s your number?

Preston Pysh (00:55:16):
Well, I was looking at it in market cap terms. I think once it goes over a trillion in market cap. I think we’re in the same ballpark. And I think it’s going to be some round number in USD Fiat terms. I think you’re at a $100 or 150,000 when the price goes through that. Everyone in fixed income is going to be that moment where they’re like, “Oh my God. So this is how this unravels.”

Jeff Booth (00:55:39):
Yeah. And think about how many people start coming on. Like if you’re a pension fund right now, it’s not a size or a scope. This is not something you can buy right now. But you can tell a whole bunch of people are starting to talk about how am I going to own this?

Preston Pysh (00:55:55):
I think that conversation for all these pension funders is really going to start heating up. I mean, when the price goes through 50K, I think you’re going to have any large organization that’s managing pension funds is going to just, their phones are going to be ringing off the hook, I would expect. Maybe I’m biased because I’m dialed into this Bitcoin stuff. But I would suspect after 50K, 75K, I would think anybody and everybody is going to be ringing up whoever manages their pension fund and saying, “Why in the world do I not have access to this?”

Jeff Booth (00:56:29):
Let’s talk about the other side of this. How would you stop it? So, imagine you’re an existing financial system, country, whatever, how would I stop this innovation from gathering this [inaudible 00:56:41]? I’ve given it all sorts of thought. And I don’t think there’s a way.

Preston Pysh (00:56:46):
The entrenchment now that you have, I mean, you got BlackRock, you got Paul Tudor Jones, you got all these big hedge funds. So, I was flying through Canada on my way back from South Korea. This is back in 2017, in the summer of 2017. And I’m walking in the airport and go onto my gate. And lo and behold, who’s sitting there? Newt Gingrich.

Preston Pysh (00:57:10):
And so, no one was there talking to him. And I was like, “You know what, I’m just going to go over and talk to this guy. What in the world could it hurt?” And so, I go over there and he says, “Oh, what do you do?” I say, “Oh, well, I do a little podcast on investing. And I have a real interest in finance.” And this was in the summer of ’17. And the very first thing he said to me, he goes, “What do you think of Bitcoin?”

Preston Pysh (00:57:34):
And I said, I just started laughing. I said, “Well, I think it’s going to be really important. What do you think?” And he says, “I bought some coins for my grandkids.” And I said, “So, do you think that this has the potential to really blow everything up?” He says, “Well, I don’t know, but it’s some interesting stuff happening,” right?

Preston Pysh (00:57:58):
And we literally talked for 25 minutes. After we were done with the conversation, I wrote down on my iPhone some of the things that we discussed. But I remember walking away from that conversation just thinking, “Here’s a guy who’s dialed into the political spectrum, probably more so than anybody. And I am so political agnostic, Republican, Democrat.”

Jeff Booth (00:58:20):
Yeah. Same.

Preston Pysh (00:58:21):
I always say that having a strong opinion on one of those in either camp speaks more about what you don’t know than what you do know. And so, the conversation was just unique for me to be able to have an interaction with a person who is deeply tied into the political structure. And that’s the very first thing he says to me in reference to finance. I found it crazy.

Jeff Booth (00:58:41):
It’s really interesting. Funny enough, on Thursday, I’m speaking to House of Commons in Canada Finance Committee on this topic, their budget. And so, this is everywhere. Everybody’s talking about, you know from your podcast, the amount of people coming to me, not just the public persona piece, but all your friends. All the people who didn’t listen three, five years ago that are now all over. Can you explain this to me? Can you teach this to me?

Preston Pysh (00:59:11):
It’s wild. And to answer your question, the root of your question, I don’t know that I can. When I look at the amount of entrenchment that has happened all over the world, I think the argument is how can we stop this and what happens if we do? Because that’s always the second question. What if we do stop it? Then let’s walk through that scenario.

Preston Pysh (00:59:30):
Well, sir, or ma’am, these other countries won’t do that because they’ve been a victim of dollar dominance for the last 80 years. And you might be tripping in the fastest 100 meter sprint that you’re ever going to race as a nation. Right? So, I would be hard-pressed to believe that conversation isn’t also accompanying the conversation of how do we ban it?

Jeff Booth (00:59:52):
And why would anybody want to then? The reason I use that climate example. So, right now you have a whole bunch of governments pumping tons of money into climate saying to the population, “We have to solve this. It’s mankind’s biggest issue,” so that we can spend more money to drive inflation.

Preston Pysh (01:00:11):
Yeah. But if you’re highly influenced by somebody who has very deep pockets, that’s a fixed income person off of Wall Street and they can come in and they’ve been donating to your campaign for years on end. I mean, I can see that scenario playing out. I can just see it as further manipulation.

Jeff Booth (01:00:28):
So, I guess what I’m getting at is, if you break down every different argument on the existing system, you can see the existing system completely falls apart without manipulation. So, every argument, climate change breaks down, every single argument about all the fear in the existing system that keeps us locked into the existing system, they fall if you keep on driving into them, they all break down against this. You fix money, you fix everything.

Jeff Booth (01:00:56):
So, when I look at all of these things and I go in a disciplined approach to first principle, and I say, “What are we really saying on climate?” Because we’re not saying fix climate, we’re saying inflate so we can print more money so we can make climate worse so we can scare and we have more control.

Jeff Booth (01:01:13):
Now, one side of me might say, “Wow, that manipulation and control who’s at the top of this pyramid?” So if I was a conspiracy theorist, you can really go down the black hole here. I don’t actually believe that’s the case. There might be some people that know what’s going on, but I actually don’t believe that that’s the case. I believe it’s more likely they don’t know how to get out of this. They have no idea how to get out of this.

Jeff Booth (01:01:39):
Climate looks like a place where we can gain jobs. We can keep this merry-go-round going for a long time. We can be politically popular with a whole bunch of people and we can keep this going. Without realizing that they’re causing a whole bunch more problems. So now, if you buy into the second thing that both of us agree on, it’s not a conspiracy theory. They don’t know how to get out of this.

Jeff Booth (01:02:02):
And you give people a way out and you teach people, this is the way out. Bitcoin is a path out of this and it doesn’t need to look like this anymore. It’s a vote for the free market, which solves just about all the other problems. Not all the other problems. The amount of time that I would save it to move into solving other problems would be staggering.

Jeff Booth (01:02:23):
So, if we could teach more people that, what that would look like, including political representation and pave a path for what this looks like, it’s going to happen anyways. But it’ll happen fast.

Preston Pysh (01:02:37):
Last question. This comes from Mia. And if you were starting over today as an entrepreneur, and I think Mia just got out of grad school or something like that, where do you see the greatest opportunities in the coming 5 to 10 years?

Jeff Booth (01:02:54):
There are so many opportunities, just staggering. If you think about problems in the world, think about opportunities to solve problems for people. And there’s a whole raft of areas largely through regulation that have not been attacked by entrepreneurs solving things with technology. And you can see what’s happening in the FinTech space right now is that, and the regulation is breaking down as a result and it will break down everything else.

Jeff Booth (01:03:24):
Health is another area. Agriculture is another area. Giant industries that we take for granted. Education is another area. They always will look like they look like today. And so, technology enabled into some of these areas can create amazing enterprises.

Jeff Booth (01:03:41):
What I would say to tackle that, get involved in some of the startup programs, get involved in the community where the startups are. Learn what the startups are doing. Creative Destruction Lab, which I’m a fellow in Creative Destruction Lab, has a number of different campuses around the world. Some of what’s happening, the entrepreneurs applying to get into that and mentorship through that and some of the companies that are coming out of organizations like that.

Jeff Booth (01:04:13):
If you’re just getting out of school, get involved in a company that you believe has a path in technology that tackles something that you care about. Your learning rate will be so great out of that. Even if the company fails, your learning won’t, you’ll go to the next company. If you understand how technology is changing the world so fast, there’s just immense opportunity.

Preston Pysh (01:04:36):
Jeff, it’s always a pleasure and people need to read your book. Give them a hand off to your book, give them a handoff to your Twitter handle, that kind of stuff.

Jeff Booth (01:04:46):
My book’s called The Price of Tomorrow and Twitter handle is @JeffBooth.

Preston Pysh (01:04:51):
Oh, man. Always a pleasure to have you here. Thanks for joining us.

Jeff Booth (01:04:55):
Thanks, Preston. Always a pleasure.

Outro (01:04:58):
Thank you for listening to TIP. To access our show notes, courses, or forums, go to This show is for entertainment purposes only. Before making any decisions, consult a professional. The show is copyrighted by The Investor’s Podcast Network. Written permissions must be granted before syndication or rebroadcasting.


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