#149 BOYSCAST INTERVIEWS: Balaji Srinivasan: The Man Who's Always Right.
Balaji Srinivasan explains how network states work in practice: people issue personal tokens tied to their .eth names as reputation collateral, with on-chain identity and social consequences preventing defection. His book The Network State is a living website being updated to version 2 next year.
Questions this video answers
@BalaGS
The boys cast Collapse the homies.
The boys cast. Welcome, everyone, to the Boys Cast Interviews. The boys cast Interviews.
Interviews.
That's the thing they don't know about what we're capable of intellectually.
This one was quite the rabbit out of the hat.
Yeah, this is. So there's this guy, Balaji. He's been right about everything. He's one of the. Probably the best Twitter accounts. Me and Danny just spent, like, you know, a couple hours with him after the podcast, hanging in. It was like we were both.
Smart guy I've ever met. Smartest guy I've ever met by far.
Like, I have.
My head hurts a little bit right now.
We both laugh being like, that guy's smarter than us.
I knew he was smarter than that with how much. How wide the margin.
Well, it's interesting because, like I said, I. I've forever ago saw him, like, on different podcasts popping up, and I was very like, who the hell is this guy? So anyways, actually we talk about it at the beginning, then how, like, we ended up having him on the podcast. But I thought this was, like, super cool.
Awesome, awesome, everyone.
The boys cast interview series. You know, the Tuesdays be coming at you.
Yeah. You know what to do. All right.
This is Balaji to me. This was like. The whole thing was super, like, very.
Internet, where you're like, are you in New York? And I'm like, yeah, well, I happen to actually be in New York. Right.
No, because me and Danny have talked about you multiple times, even on the podcast. And I've. You were like one of those people that every time I kind of saw you pop up somewhere. I remember the first time was Tim Ferriss. I was like, who is this? Like, I just. We both thought you were the man. And then. So Chris Williamson had him on, and he tagged me in something, and then I was like, yo, heard your podcast with biology. I thought it was sick. And then he messaged me immediately, and I was like, if you're ever in New York. And he's like, I'm here right now. And it was like. It was like five seconds of being like, oh, this podcast was good to be in. Like, now you're in a studio, which is that not peak Internet?
Well, that is actually. That's a lot of what I talk about in the book, because there's like, these. The natural state. Exactly. Our community is really online, and then, you know, it's there. But so do you. You want to. Shy intro. How are you?
I'll say, why?
The.
The quick thing of why I felt like people like you or the, like, opinions I think are so sick is because everyone is always talking about, like, what should happen. Yeah, yeah, yeah. And then I feel like you're kind of talking about, like, what's likely to happen and then what to do about it.
Right.
Which is why I feel like me and him both immigrated here too.
Right.
From Canada.
Oh, really? Okay. Yes.
Yeah.
And I.
You talked about that too, where there's like, a different mentality where all of this in Canada, and we're like, yeah, yeah, that's why you leave. You have to leave.
Right.
And everyone's still there being like, how to fix this? It's like. So I feel like that kind of was the type of stuff you were talking about.
Absolutely right. Like, because the thing is, it is way easier to be against something than to be for something. And most of the time, like, most people's affection for a politician is based nowadays, especially in what they're against more than what they're for. Yeah. And so everybody can be very precise, but what they're against, when you get them to actually say what they're for, suddenly a coalition breaks into, like, 50 different factions.
Yeah. Because people are like, I'm not for that. And you're like, okay, well, not that then.
Yeah, exactly. That's right. And it's kind of like, you know, think about all the places you are not versus the place you are. It's kind of like that, but an ideological space rather than physical space, you know. So, you know, part of what I was trying to do with. With, you know, V1 of the network state. And so just, you know, for the audience, if they don't know.
Good little primer.
Yeah, yeah. So go to thenetworkshade.com It's a new book that. That I just wrote.
Can I describe it and you tell me?
Sure, sure.
This is what I thought. Like, essentially you're saying if the way that you describe it is you're not, like, crazy bullish on America as being, like, the sole center of everything moving forward. And then with you kind of see, the world is, like, centralized versus decentralized. And what it looks like moving forward is people sort of form communities online, and essentially they could even, like, buy land and have presidents and stuff like that. And that's kind of what you think the future might look like, or if it does look like something like that, you outlined how it will happen.
Yeah. So one thing I want to. Yes, definitely. Definitely in the ballpark and close, but I wanted to kind of offer a Few asterisks, whatever. Right, yeah. So I would say I'm definitely pro American values in the sense that there's certain universal values of which the United States of America was the best representative of those. You know, fair play, equality under law, rule of law, you know, you know, abiding by contracts, treating people with all that type of stuff, you know, which has. Unfortunately, you're like, is that going away? It is unfortunately going away to some extent. You're getting more tribal, you're getting people mad at each other.
We just moved here.
Yeah, that's right. I know.
We moved here from Canada, where you lived.
From Canada. Right.
One degree worse.
So in sort of the same way that that torch was passed from arguably from Greece to Rome and then after a long delay from like Rome to the UK and UK to the US Right. Like. And each person being an imperfect messenger, you know, there's. I think the next torch pass is from the Americas to the Internet. The Internet is not the same as America. People think of it as the same, but it's really not the same. And in fact, in many ways it's more. It is to the Internet is to the Americas what the Americas were to the old world of Europe. It is, for example, it's a more global kind of thing. There's more people there from all over the world. You have. You go from common law of the UK to the Constitution of the US to the smart contract of the blockchain. You just get more precise about what you're doing. Right. So it's both more capitalist and more inclusive, you know, so new frontier kind of. It's a new frontier, Right. So it kind of. If you think it's like V3, right. And one way, I think wave.
What's V3?
It's the third version. Version. Version three. Okay, yeah, version three.
But I thought it was like, you know.
No, yeah, yeah, that's right. So it's. It's not a podcast abbreviation. That's right. So, I mean, one way of thinking about that, I mentioned this, and it's something that most people don't have. What we call price priced in. Right. What is not priced in, for example, is the fact that the majority of English speakers online in the next 10 years or so are going to be Indian. Why? Because about a billion something Indians have just gotten online and many Indians speak English and many more are quickly learning English due to being online and Indians crush it. Well, there's some Indians who are quite good, you know, I mean, not all. Some are quite good and. But the thing is that that Internet, unlike the Chinese Internet, is not air gapped from the American Internet. The Chinese Internet is its own world, right? Like because of the great fire, they've got, they've got a Galapagos Islands ecosystem where they've got different versions of everything and things are, you know, you've got, you know, fish with feathers. Everything is like all their own apps.
That are essentially like the apps we use, but just specifically like.
Yes, though, though it is WeChat and stuff like WeChat but. But you know, what is, what's useful? There's a book called AI Superpowers by Kai Fu Lee. Okay. It came out right before the pandemic. It's now about a few years old, but it'll give you a snapshot of this sort of Galapagos Islands ecosystem where for example, one of the biggest companies in China is like the Chinese version of Groupon. It's called Meituan, but it did a lot more. Imagine if Groupon executed extremely well, right? Nothing against Groupon, but you know, the American version did only like so. So the Chinese version had like amazing will to power CEOs and, you know, or CEO and did. Did extremely well.
That wasn't just. They like a deal better.
It wasn't just deal better. They do a lot of other stuff, right?
Were they before Groupon or.
I think, I think they were. They were at first a Groupon clone, but now they fall on the most insane hype.
At the time, everybody's like, what is this thing? And now it's like, Yeah, I get $5 off of.
Of sandwich, some Broadway show I didn't even really want to go to.
But the thing is, couldn't even cash it in anymore. Well, it's interesting though, Andrew Mason's original. I mean, look, it's hard to build a business and so on, and the fact that he got it to public is, is. Is good. But yes, there was a huge amount of hype about it 10 years ago, but the entire concept of crowdfunding, having a, a crowdfunded deal tip over if you have enough collective action online. You know, he had actually, Andrew Mason had started the thing as the point, which was like this attempt to try to get people to cooperate online to do something together, we found was that it was easiest to cooperate to get them to buy something. At that time that was like 10, 12 years ago. Perhaps you might be able to get them to cooperate to do something of more significance now today, 1012 years later, when there's a lot more tools that are being developed, you know, so. But to your point, right, so yes, I'm not that bullish on the particular state as a guarantor of those values, but I am bullish on those values. So how do we actually work around that? How do we actually, you know, preserve some sort of global rule of law? You know, one way I put it, I had this article that came out in, in Foreign Policy a few months ago and it's like, you know, the US is less and less a guarantor of the rules based order. China doesn't even pretend to be. You know, it is essentially just it's self interested for the Han. You know, you can do a deal.
Yeah, they're almost like kind of similar, but one's like, yeah, that's the deal. And the other is like, no, we're not like that.
Yeah, yeah, yeah, exactly. Right. So I talked about how, you know, there's this weird convergence of the two things. You know, in, in China they call it human flesh search, and here we call it cancellation. Okay.
They call that. That's what they call it there.
Yeah, it's, it. I mean, trans search. Just think about what that sounds like.
They call it human flesh search culture.
Well, no, no.
Look at these comedians talking about human culture.
Yeah. So human flesh search, big. Basically, you know, it's a very evocative term. It's like, you know, there's this guy online, he said something wrong and so.
Then these, when he went to Amsterdam, he said he was doing a bit of a human flesh.
Well, okay, sure. So, so this is a different version. So this is like, this is, this is the unfun version, I guess. So basically they find somebody saying something bad online and then all of these Chinese netizens, their equivalent of 4chan, just goes and trawls through to find who this person is, where they are. It's like pawing through all of the flesh of all the humans to find that one person who said some thought crime. And then the whole Internet piles on them.
Right, that's what happened to Uncle Roger.
Yeah, I guess so.
Yeah, yeah, lots of people. Yeah. This comedian who was on our show, but the same thing happened, said something about off color, about Taiwan, like a joke or something.
Oh, yeah, yeah.
And like he had a whole PR fiasco and.
Right, exactly. So, so there's analogs of all this stuff on the Chinese Internet, but it's often like the inverse. For example, you're not, you're not criticized for being, you know, to nationalist, but not for not being nationalist enough. Okay, yeah. Of course, they have in their own way gone to this ultra. Right, ethnic nationalist level since Xi Jinping took office. Just to, you know, quantify this, because it's less visible to us, you know, being outside. On the order of 90% of like governors and so on in China were like replaced like the plipro, the Standing Committee. There's various facts and figures I'll probably like tweet afterwards to get the exact numbers. But something, if I recall correctly, like 57 out of 63 of a particular group were replaced by Xi Jinping. Going into like 2017. Cleaned house. Cleaned house. Right.
It's like sports.
Well, yeah. So about like 90% of people were just like replaced like this. And then you started really seeing the change in attitude where the sort of more quiet internationalist capitalist attitude of the, you know, Deng Jang Hu era. Those are like the three leaders of China prior to, prior to Xi Jinping. That kind of sort of quieter multilateralist. Like we're just making stuff and selling it to the world. Hide your, you know, hide your strength and bide your time. That gone now. So so called Wolf Warrior diplomacy where they're just very aggressive wolf warriors. Like the Chinese Rambo. Okay. It's become very popular over there.
And that's the China has like, they're like big movie that.
That's like Rambo, Wolf Warrior 2.
If you've never seen it, he's like fighting for China.
Yeah. So go watch it because it is something where it is like Rambo except it's the Americans that are the bad guy.
Oh, you know what? I saw a preview of it because it's such. It's like the biggest movie.
Right.
And the whole thing is, yeah, America's the bad guy.
Yeah.
They're fighting against America.
I love that guy as a dad. That's like Frank Stallone. Like it's like exactly the same.
Yeah. So like Wolf Warrior 2 or more recently the Battle of Lake Changing. Right.
That's the one I saw.
Yeah. Okay. Right. So both of those were like, I think number one in the Chinese box office. I think Battle of Lake Changing is now number one globally. Even as Hollywood is sort of tanking. China sort of taken over many aspects of 20th century America. It's got the gigantic, probably the single largest market, all those kinds of things. And it basically shows again, this. All of the Hollywood, you know, techniques. But you know, the ominous music plays on top of, you know, the American military.
Yeah.
Okay. It is disorienting.
I mean, that's how like a lot of people Here would probably like to make American movies too.
Yeah, but that's true. Except the difference is I feel that when they're made in the U.S. there's also an American good guy. Yeah, yeah, right. There's, there's the activist or what have you who stands up to the evil military.
Right, exactly what it is.
Stands up to those people storming the capital.
Correct.
So the problem puts the rainbow flags on them as a ceremony, what have you.
Okay, right, exactly. So. But the problem and solution are both coming from within the house. So therefore it's like it, it's one thing, but when you see it just totally overseas, it's quite a different, that is a different hierarchy, a different tribe versus this tribe.
Old school America.
Well, yeah. Okay, right. So. So now the thing is, it's worth, it's worth watching this because it's just, it's just getting a sense a temperature check on where other cultures are at. Right. Yeah. And you know, this is something which is I, I find it interesting because I mean, for example, can you. Most people don't know how China got rich. Do you know how China got rich or rich?
Manufacturing iPhones.
Well, so that's part of it. Right. But like, I mean they were communist.
Yeah.
How did they, what happened?
They like opened up the markets, but.
Yeah, but what, what exactly?
Like, no, I don't know, I just thought they kind of, I think it.
Was like a lot of like bootleg DVDs to start.
Sure. So what happened was Deng Xiaoping, who was a communist revolutionary also, but he was purged multiple times, times managed to win power in what was effectively a Coup in the mid-1970s. He took over and without changing the brand of communism, started doing things that were these so called special economic zones, starting with one across the causeway from, from Hong Kong called Shenzhen that worked and he didn't. He called it communism even though it was capitalism. Okay. And that grew like a weed. And so then he started cloning it across the east coast of, of China and, and you know, more special economic zones cropped up and eventually, you know, he was able to essentially turn around the country and he took over. He took power at like I think age 78. And most people thought he's going to die like soon. But he managed to run it until like his 90s and then he transitioned power in the early 90s over to Jiang Zemin and. And then that kind of, that like began. So he was like a startup founder at age 78.
Right.
Okay. Which is, I mean just think about the stress of Running China. Okay. Now, there's lots of criticism one can make of Deng. I think Ezra Vogel's biography is probably, you know, one of the best on this. But it is. There's also, if you want to just. Quick article. NPR has this article, and it's called the Secret Document that Transformed China. One thing that people don't get is, you know, when you talk about what communism was, capitalism was punishable by death. Okay, Just to give you a sense, before dang, you know, became the.
Then he made it like, we're basically gonna do it, but we're gonna call it the old thing.
Exactly. He had the saying, very famous saying, black cat, white cat matter if it catches mice. But before Deng, you know, there was a. There's a province called Xiaogang, and there are a bunch of farmers there. And, you know, the. Communism was interpreted in not just in China, but other places to mean that there wasn't even any personal property or anything. The teeth in your head, they belong to the collective. Okay. So all these farmers, they were like, on. Basically just starving, but if they kept any grain for themselves, then, you know, the. The. The guy, the commissar who's overlooking the district would notice. Right? So these guys did. Is. They did something worst. Yeah, right? So. So these guys is these farms come.
In and you're, like, looking extra chubby and you're like, nothing.
Yeah, exactly. That's right. So, because. So essentially what these guys did, these farmers, they signed a secret contract, which was itself. Contracts were illegal. Okay. They signed a secret contract that basically said, okay, look, we're all gonna take some of the. The grain that we make this time. And if we are killed for this, then the ones who are not killed will take care of our children. Okay? That's the kind of. That was the level basic profit sharing. And a contract was so taboo in China that they, like, signed this secret document and hid it in their roof. Okay. And so what happened once. Once they had the screen and all these guys, once they could keep some of what they earned, wow. They had a gigantic bumper harvest. So, of course, the authorities were like, you seem to have a lot of grain nowadays. And so they were going to get killed. But Deng said raised up his hand and was like, okay, no, we're doing the new communism this time, right? It's. It's capitalism now we call communism, right?
Yeah, yeah, yeah.
But that's like, the reason that story is kind of important to know is just, like, how insane this stuff got, right? And importantly, you know, the. The Red Terror, the excesses of communism in the Soviet Union happened in the 1910s, you know, 1930s. Right. But there was like a lag and it became like insane in China within living memory. You know, in the 1960s, 1970s, you had the Great Leap Forward. You had the, well, 1950s, 19 Great Leap Forward, 1960s and 70s, the Cultural Revolution. So within living memory, this thing that, that sort of burned its way out through the population of the Soviet Union, which had settled into sort of this Brezhnev, like it wasn't as murderous, was just like carving a swath through China in the 60s and 70s. It's still very live. You know, probably, you know, people listening to this podcast were alive when people were being killed for capitalism in China. Okay. Now from that to Chinese tech billionaires in one generation is so insane.
Yeah, that's wild.
That, you know, you have to. You have to sort of understand what kind of turnaround happened in their society, you know, just to understand, like, how much of a head of steam they have. They feel highly motivated and what have you.
They like, they're. Yeah. And they're like.
They're trying to catch up.
Well, they're trying to catch up. They also, I mean, or take over or take for. For example. Yeah. So there's. There's aspects of US History that other people would consider very obscure that are now about 16, 19 or something like that. Okay. Other cultures pick through, you know, there's. There's about 100 billion people who've ever lived. Okay. So you can pick through a hundred billion lifetimes to find those things that kind of support your case. And so what is China? What's big in China? The Opium Wars. You know, the Opium wars are. Yeah, yeah. So essentially, like, you know, whether it's a British or actually the. The Americans were allied with them at one point. This called eight nations along clients to essentially fight to deal drugs in China for profit and like addict the. The population to it. So.
And that. Yeah, it's pretty easy to paint that as like the bad guys were coming in to try to get everyone addicted to drugs.
Exactly, that's right. And so. So essentially this stuff which is not stressed in the west, is big over there. Really big. Right.
It's like some tiny thing that you kind of hear about here.
It's a footnote in a history book here. But it's like a huge front page daily even still, because. Yes, because they have like, we remember.
Shirts, like kind of thing.
It's politically useful. Right, of course. And so I talk about a lot of this in the book, which is essentially, you know, you will, essentially each regime will have propaganda that is useful to it, that is not useful to the other side. Right. And so it's not so much usually. Sometimes what they say is false, sometimes what they say is true. It's just not useful to the side. So it doesn't even acknowledge it. Right. And so what, while bigger than the Opium wars, they don't really talk too much about Mao and the Great Leap Forward and all that stuff. They'll say Mao was seven parts good and three parts bad. Why? Well, at least he unified the country and he kicked out the Japanese. Okay. That's the. Well, you know. And he's good for that. Right. You know, he didn't have to do it quite that way. You know, he was. There were many other problems with that. But that's very sugar coated. Very sugar coated. Extremely sugar.
He killed a few people.
Yeah, but what's.
Everyone's going to kill a few people.
What's interesting about it. Exactly, exactly. Right. So what's interesting about it is there's actually three very different groups that are all invested in that idea that China is, quote, communist. The first is the Chinese Communist Party itself. Right. Which wants to maintain that Deng's Coup in the 1970s was like, like continuous. Right. That it was still the same. Same thing. Right. The second are many Republicans who want to say, oh, the Chinese Communist Party, you know. Right. And the third are many tankies who project onto China.
Look how good it's gone.
Yeah, exactly. Right. So whereas really what they are is ultranationalist. You know, they, they do use communisty stuff. They are doing like the so called Common Prosperity Doctrine where they're going after lots of rich guys and.
But yeah, that's like the Alibaba guy and stuff.
Yes.
Wasn't it that he sort of, he had all these opinions and then like he disappeared for two months, came back and he was like, got a little.
Too big for his britches. That's right. One way. Exactly. So one way of thinking about it is communism is whatever the Chinese Communist Party says it is. Okay. And what that means is basically, you know, they're at the center of a network and you know, you could be, you know, it could be Xinjiang, it could be Taiwan, it could be Hong Kong, it could be Falun Gong, you know, it's like a religious movement. It could be the tech, you know, libertarian ish capitalists of Jack Ma. It could be, you know, Bo Xi Lee who's like, who's an ultra Maoist and so on and so forth. There's various kinds of deviations from their center of opinion. Some are to the left, some are to the right, some are to the libertarian right. Doesn't matter. Anything that deviates too far is not communist. Communism is whatever the Chinese Communist Party says is.
So what's the center of opinion like.
North America democracy, where the American Democrat Party says it is.
I think I heard you say so.
Yes.
Because you know, it's so funny because that was like one of the questions that kept like I kept asking people and no one had a good answer because I was like, I always hear people say they're against democracy and I'm like, I really, I'm like, I don't get what that means. Because everything they say, it's like stuff they do too. It's like so like they're just like, I guess he was like Trump, the election thing, but it's like they did this. I don't get it.
Okay, okay, so let's, let's take it, let's use. Let's start with different words and then come back to this one. Right? Something like Christianity or communism or capitalism or democracy is such a capacious word that it can contain both X and its opposite. For example, right. Christianity originally, you know, the original Christianity around the time of the Romans was a slave revolt that tore down the empire. Later that same word, Christianity was used to basically justify the so called Holy Roman Empire, which styled itself a successor to the Roman Empire. And it was like a Christian fusion. Right. The concept of a Christian king was sort of oxymoronic, at least for the early Christians. Right. Like this was like a, this was like a slave revolt basically. Right. And you know, when you think about communism, communism also has meant both killing all the capitalists and capitalists joining the Communist party more recently.
Right.
And when you think about capitalism itself, think about What? You know, 1800s agrarian capitalism versus 1900s industrial capitalism versus, you know, 2000s technological capitalism. I mean it's not quite the opposite, but it's very different. Right. You know, the kinds of things, you know how you're counting or like the.
Tech version now versus the tech version.
Exactly, that's what I mean. So I mean, the technological capitalism of today in the 2000s. Right? Yeah, yeah. Right. So in the same way like democracy means many different things. For example, one thing that you can do if you go to Google, Google Ngrams or Google Books actually, and there's a thing where you can type in and look at old words. I think it's N grams Or Google Books. Right. I think it's Google Engrams. You can type in republic, comma, democracy, and what you'll see is republic. People used to refer to the US As a republic, and that's like declined.
It's more of like a Twitter thing that people say to argue now.
Well, so what you're gonna. What you're gonna get is you're gonna get probably, in my view, you're gonna. The Republicans starting to say our republic. And I will, I will.
Actually, now that you say that, I do notice there's more people on the right who refer to it as a republic.
Exactly.
Almost as like a correction. Because they're always like, this is a democracy. And they're like, it's not.
Well, or.
Or show what side they're on. I think, like, verbally, you know, it's like the patriot thing, you know.
Yeah.
Only right wing people call themselves patriots on Twitter.
Yeah, exactly.
People on the left do never refer themselves as patriots, even though they might be patriots.
Sometimes, like politicians will say, like, if you were an actual patriot, patriot, you would do this.
Yes, yes. And so. And that's like this sort of double reversal where you try to use the other guy's language on them. But. And by the way, on this, like, you know, I think of Democrat, Republican is becoming like Sunni versus Shiite. So I don't want any part of it. I just want to be. Well, it's actually. So let me actually put some meat on those bones. Right. Something like 96% of Democrats are not married to Republicans. Republicans. Okay. And if you look there, if you Google, for example, Vox actually has a link. Google Vox, Democrat, Republican network diagram polarization, I think 2011. Okay. And what you'll see might put this in the, you know, show notes or there afterwards, is a relatively unified, you know, roughly bipartisan Congress in the 1940s that pulls apart gradually into two groups that only vote with each other. Straight party line votes over and over again. The only, you know, bipartisan votes are for, like, bailouts or bombings or things like that. Okay, sure. You know, when they do something both stupid and evil, it's bipartisan term. Right. And so the leadership is pulling into really two different groups. And there's a CGR 2017 article. It's like Breitbart change right wing media ecosystem that shows a similar diagram not at the level of Congress, but level the population again at the network level. You can see red and blue, blue becoming literally separate networks. Right. Now, what that, what that means is it's not one Nation under God, indivisible. It's two nations, the Democrat and Republican nations.
I will say that, like, I do see in real life a lot of people where like the dudes sort of like a little more right wing and the girls sort of more. A little liberal. And it kind of seems to work.
Yeah, but, but if you, at least if, if you look at the numbers on this, they actually vote for when they marry.
About the cities.
Yeah, exactly. It's becoming tribal. Right. It's literally becoming something where ideology becomes biology in one generation. Meaning basically, it's like Protestant, Catholic. It's like Sunni, Shiite. This is not something, if you look.
At all the graphs, just like any other one.
Yeah, exactly. It's. It's becoming two ethnic groups. Like Republicans marry Republicans and Democrats marry.
Democrats and they live in different places.
That's the sort that's happening. Right.
That's when they're talking. People are talking about the divorce. Like people.
National divorce. National divorce, Exactly. So divorce has already happened in the cloud. We're seeing it start to materialize on the land, basically.
Like Twitter and Truth Social.
Yeah, right, exactly. So, exactly. In the cloud, you already have these social networks. You start to have apps that are. Right. Coded apps and podcasts and stuff that are left coded because you have foundational premises that divide these worldviews, you know, and. And then you're starting to get them physically sorting.
Yeah, because every argument just gets back to the original argument that you disagree on.
Exactly. That's right. And so, you know, the thing about this is, what's interesting is the reason. One way you can show that's really just tribes is during COVID Democrats, Republicans switched sides several times. You know, at first it was extremely, you know. Right. Coded to think, oh, the coronavirus could be an issue because, you know.
But that was a huge switch, actually.
Yeah, it's a huge switch. Right. Like, you can't, you know, you can't explain this by some referenced kind of immutable right and left. At first it was something where the China virus was a huge deal and it was racist to talk about the China virus, then switched sides. And then, you know, Trump was saying, you know, we need to slow down the testing, this is not a big deal, etc. And you know, the, the left is saying, oh my God, you know, we need to test more, etc. Total switch from.
Is just to oppose him.
Do you think? Just to oppose.
Is it just a.
Well, to oppose each other. Both to oppose.
And you kind of predicted, like, I.
Don'T even Want to get. Yes, yes, yes.
He's right about everything.
Well, I, I, I, I, I'm not always sure. I mean, you know, some of my investments work, some of them don't. That's how I kind of record them. But I do think I got this one correct. Mostly the. Then what happened is Trump came out in favor of vaccines. And then, you know, Kamala Harris and others said that they would potentially not take a Trump vaccine because it had been rushed through.
So many people said that.
So he said that during a debate.
Yeah, during debate.
Yeah.
And then it flipped again where now the right. Is, you know, like anti vax and you know, some of them are skeptical of the germ theory of disease and the left wanted masks for four year olds forever or whatever. Right.
Yeah.
And so, I mean, it is not necessarily that, like, oh, both sides have a piece of the truth. It could be that both sides are actually like, gone in some ways, you know, and you just kind of be like, okay, just let them slug it out, you know, like as.
So is that what you see? Like, as an individual, you're just like, like, why? Unless it, like what? Like, why get involved in this? Yeah, right. That's just gonna go on forever.
Once. See, the thing is, like, when we.
Read it really believe in one of the things.
Maybe that's right. So when, when you read about other societies in like, space and time, do you want to get in the middle of the Protestants and Catholics when they're arguing over the, whether the wafer is the body of Christ or not? Right.
Yeah.
Like, I don't want to get in the middle of that. Right. Like, slug it out, you know, good luck. Right. You know, may the best man win, you know, and just, just basically be away from that. Same with like, you know, Sunisha, do you want to be in the middle of the Iran, Iraq girlfriend arguing for a piece of cake or something? Yeah, exactly like that.
No.
Yeah. But do you think that there's people who will essentially say, like, oh, it's a, it must be nice to not have to, to be able to sit on the sidelines because for them to go, this is like real world.
Well, yeah. Yeah. So here's the thing. First is the folks who say that are usually. Those are folks who are usually also complaining about white privilege. They tend to be the most privileged whites. Yes. You know, so to speak. Right. So, you know, it's like Barnard. Bam. You could just be like, okay, which private school? Sidley. Okay, which one did you go?
You know, but also like anytime, like anyone I feel like when you're trying to do anything, like moving forward, at least in your own life, anyone that starts being like, oh, I like, yeah, I would do that, but I have like, some moral. You're just like, those are the people that tune out.
There's an immediate counter argument to that, by the way. And you know, you know the game of slaps in New York, like, you know, you go like this, like this, you know, on top of each other, right? So what they're trying to do is you're putting forth an argument and they're asserting a dominance move. They're trying to say you're a bad person. Right. They're not arguing true, false. They're saying you're bad. Oh, it must be nice to be so privileged that you don't have to be concerned about this. And then, so, you know, you can try arguing true, false, but you have to actually go back with, they're a bad person. Well, actually, the rest of the world doesn't want to get involved in another white and white war. So white and white violence. Why don't you guys get. Get. And all these other poor people around the world can. Can go and build up their own economies. Right? And you know, so the thing is that somebody like that essentially, they're like, they don't even realize how aggressive they're being necessarily verbally. Or what they're trying to do is insult you and gain status. And you just can't let that. You just have to do.
I always feel like, too. I think that's exactly right. And then also, you're like sort of like a casualty to their agenda. Like, you're not even on the same wavelength. It's just like you're. You're trying to do something and it's just like a little bit in the way for them. So.
Yeah.
You know what I mean? It's like, so you should not, like, don't even. Like, these people are relevant.
They're. They're actually very. A good way to think about it. We know the term greedy, right. These people are very status greedy. Okay. They want to always have the highest status in any interaction. They're not willing to just engage with you as a peer and so on. They want to assert a dominance move of you're a sinner somehow.
Oh.
And they've got a practice repertoire, really, of sort of verbal tools, scalpels and hammers and so on. Right. That actually were kind of developed in academia to win various kinds of faculty lounge battles. Nerd battles. Yeah, yeah, yeah, exactly. So all of these battles in like humanities, you know, departments and so on. Those weapons spilled out onto Twitter, they.
Work a little less.
Especially like, it's like the debating stuff. Like the amount of people who you go on Twitter and just the average person on Twitter just knows every, you know, like debating Latin, debating term. And you're like, why do you all know this?
Right, exactly. Because it's memetic. Right? You know, in fact, actually I had this. I'm just going to read this, read this tweet to you just because it kind of illustrates something thing. Hold on, my dude bad take this ain't it, chief. Read the room and do better. I know you hope she sees this, bro, but as a haver of good opinions, you're posting cringe. So stop licking dim boots, log off, touch grass and delete your account. Okay?
It's like all of them in just one.
It's all of them. Just one. Right? And. And so the thing about this is I posted this.
That's how I tweet.
I. Yeah, yeah. So. So the thing is, once you kind of post them all together, right? And you know, people at first didn't get that it was parodic because it was just. It was really like 11 cliches or everything. Like a parody. Oh, okay. Yeah. So it was like 11 cliches, like back to back, right? Yeah. And what I call this, I call this down talk. You know, it's like this condescending tone. Yikes.
You missed.
Yikes.
Yikes. Big yikes. You know? You know, that's a quiet part out loud. Uh, stay in your lane. Not a good look. Take the L ratio.
It's a. It's a person that was like a doll that you pull the thing and it only has like 11, like phrases that can come out.
Yeah, that's right. So, so basically we're. It's like GPT3. Do you know what that is? It's like a AI thing.
Yeah, the AI. The similar. Like, like a chatbot. Yeah, chatbot.
Right.
That's right. So if you take not a good look, take the L in ratio, you can combine that into. Not a good look, man. Take the L already you're getting ratioed. It's like an algebra of put downs. Yeah. Okay.
Is that going to be a shirt available in your merch store?
Something. Well, I. The thing is what I. What I do is I. You know, when you distill all of that, right? I mean, you can put it all together and you can see because they're all like spread out.
What Happens.
Yeah, yeah. You realize that that's almost like people learning words that they're repeating some. Somebody came up with that and it was like a little verbal knife for close quarters combat that fits in the 140 or 280 character environment of Twitter. And so because that little verbal knife kind of works there, it's like copied and cloned, this digital knife that you can just stab, like in a video game. It's like a karate.
It's like a karate move.
It's like a karate move. It's exactly right. So it's like a verbal. Like this. Right. But then you can often go meta and you can actually block grab, you know, like, you know, Neo in the Matrix, or you can turn that, that knife into just digital bits by just quoting like 50 of them. And then that person, it's clear that they're like cliche, like a, like a.
Movie where like the villain, they just had to show a mirror to them.
Yeah, yeah, yeah, exactly right.
They go to dust.
So in the same way, those are like the dumb versions, right? The smarter versions are check your privilege, toxic masculinity, all that type of stuff. Those smarter stakes. Yeah, they're higher stakes because they have a bunch of theory behind them and all of that theory delegitimizes the target. On the other side, it's like, is academia. There's all these papers and stuff behind it because, you know, using a phrase like that is bringing in reinforcements. Right? Yeah, they're, they're citing effectively scripture to say why you are a sinner and why they should have higher status in you. Right, Go ahead.
Okay. No, I was just gonna say. So all that's like. Yeah, that, that's like such accurate description of like kind of how the Internet culture works or whatever. And then so you're kind of saying if you're like a person, all this is happening and obviously, yeah, you want to have like some tools to like defend yourself and like argue against and whatever, especially in your personal life, probably. But like, then you see, that is like a thing that's not going away. And it's kind of just generally like eating at the foundation of America. And then what actually happens is this kind of like after America thing.
Yeah, so let's talk about that. So basically people have, I mean, part of that, that whole thing that we're describing, it predated social media, by the way. People blame it all on social media and so on, but that dynamic predated social media. There was cable news, news, there's other stuff in many Ways you can trace it all the way back to there's a gigantic centralization arc up to 1950. And now we're in the middle of a huge decentralization arc that's happening even faster than the centralization. So you go, you know, railroads and mass media and mass production and the age of the factory where, like, everything is choke pointed through General Motors and General Mills and General Electric, right? That's. That's like the mid 20th century. One telephone company AT&T and two superpowers, US&US and R&3 television stations. Everything's choke pointed in 1950 something. And then it starts all breaking apart as you go from the transistor, cable news, the personal computer, the Internet, the smartphone, cryptocurrency, it just starts disintegrating and decentralizing, you know. And what's happened, though, is all of these institutions that were built for this giant centralizing era are not built for this era. So they're just flailing, you know, they're massively overblown, built for what it is that we're in, you know, and at least a lot of the western institutions. So the question is then, what does the other side look like, right? And I think many ways you can't. You can't turn back the hands of the clock in a normal sense, but you can turn them all the way around. You know, you can just turn it all ding, you know, and then you start. Start something new. And so the book, the Networks, what it's about is fundamentally finding your community online. Okay, I'll give the short version, then I'll give the long version. Finding your community online, a highly aligned online community, organizing them to first do online things and then do a very important offline thing, which is crowdfunding territory to live together with, right? That territory doesn't all have to be in one place. Importantly, it could be even two people in a group house. Okay. Or it's a small group house, you know what I mean? Like two people in a. In an apartment or 10 people in a group house, or 30 people getting like a cul de sac of houses next to each other. Those pockets around the world, you start coalescing from a bunch of atomized nodes in the cloud to start being little pockets around on the earth. Go ahead.
No, the one thing that actually I felt like I didn't get is because. So if you, like, think of how that sort of starts to play out and you have these communities and you're like, what if you bought land? What if you had a thing and that I could see how that could be it. But then I guess the other part is like, wouldn't like the countries just say, well, you, you're not a, like part of that country, part of this country. You never pay tax. Like when people try seasteading or things like that.
People can't just move to any country they want if that like location happens to be. Also, what are the percentage odds that those just. Or how many of them at least just turn into like cults where there's the one guy at the top having sex with everybody else.
And I.
If there's like. I guess it depends.
Yeah, I guess if there's. How many of them.
Yeah, I'm sure that if there was.
A country like a little island with like 50 people and maybe would be like that too. Right?
You're good. You're going to see what does the government do?
Like, wouldn't they just say, like, yeah, this whole thing's not happening?
Yeah, so.
Right.
So several visas canceled, got to go home.
Totally, totally. So several. So first of all, you know, the cult kind of thing is usually some. A group that's like isolated from the world. They usually. A cult does not want to talk to the rest of the world, so and so forth. Right. This is more like, you know, actually the early Americas were settled by, by lots of groups that wanted to be an example to the world. Right. That's a huge difference. You know, to be an example to the world. For example, like the Oneida commune that was started in like northern New York or there, you know, you know, if you think about Pennsylvania, William Penn's community, you know, the, the Puritans, there were a bunch of, you know, groups that went and settled the Midwest and they were all essentially either religious or purpose driven communities. Okay. And they just recruited people there and they wanted to build what they saw of as the better life and serving as an example to others. Okay.
Okay.
So that is actually how America was built in the 1800s. It's a good book by Charles Nordhoff called Communistic Societies of the United States back in the 1800s. At that time, communistic did not mean communism like the word commune. It made a commune or something. Yeah, it was voluntary and opt in. That's a key thing. Right. As opposed to just take all the money.
You.
It was, it was collective, but it was a voluntary collective, very important.
So I guess maybe to start you would have to just still pay the tax in this. But you're part of this other thing too, right?
Exactly. So, so essentially the thing is there's, there's a whole spectrum of levels of sovereignty.
Maybe your tax on the one could be tax deductible.
Yeah. So let's, well, right, so now let's, let's talk about this for a second. So basically with. Suppose with respect to cryptocurrency, first, let's do that first and then let's come to this.
Okay.
With cryptocurrency there are crypto and fiat exchanges, right. You can have bitcoin, you can sell it for US Dollars and vice versa, Ethereum for, you know, yen. All these different cryptocurrencies and fiat currencies around the world and the existence of cryptocurrency does not mean or has not meant that fiat law completely goes away. Right. Nor the fiat currency completely goes away. There is an interface between them which is complicated and it varies in different countries. There's regulations like kyc, all the stuff. There's countries that have tried to ban it. There's countries that have now started to embrace it. There's states like Wyoming which are allowed you to now incorporate on chain using Ethereum. There's states like El Salvador that have adopted Bitcoin. So there's a spectrum of responses by legacy states as well as ways that you can take this new system and start docking it to the old system. And over time the old system, if it can't ban the new system, which it can't for various reasons that I'll get into, or at least it's hard for it to, because this is decentralized and there's people from around the world who believe in it and it's built to be hard to ban. If the old system can't ban the new system, there's parts of it, or at least if all of it can't ban it, China might be able to ban, other countries can't, then it starts sort of seeing some of the merit bending to flexing with, integrating with or being transformed by the new system. Okay. That we're in the middle of now. We're about 10 years into that, right? About 20, 30 years into the Internet. All the politicians are on the Internet now. Now have we noticed every, every government website is on the Internet? The news, social. Yeah, well, or whatever. Right, exactly. The ones we follow are fine, fine, fine. Right, yeah. So, or, or Twitter or whatever. Right, yeah. And so the, the new system, the Internet, which was poo pooed and dismissed and you know, Twitter is this totally ludicrous thing of tweeting your breakfast. And now every single politician in the Entire world knows the importance of Twitter, right? That was 15 years. Okay, 15 years for.
Yeah, I guess that's true.
True.
It's not that long.
Right, so it's the same thing again.
Well, right, so now if you talk about not cryptocurrencies and fiat currencies, but crypto countries and fiat countries, what does that exchange? What does that surface look like? Right, and the surface looks complicated. Why? Because your crypto country, if it has 100,000 people, I've got. I've got a visual on my website. If you go to the network state in one image, 100,000 people, they could have piling up all. All over the world. Right. You have this group over here. It's like a town of a thousand. Here's a group house of 50. You have little clusters and, you know, all around the world, some of them are in South America, some of them are in the Pacific Islands, et cetera, et cetera. Okay, and so let's say you're in 100 legacy countries.
How do you get recognized as a country?
I'm coming to that. Yes. Okay, so you have 100,000 people. They're spread over, let's say, 100 legacy countries. Right. So first of all, you don't just have four directions to expand. You have 4, 400, because you can go north, east, south, and west on all 100 of these clusters. Okay. Just like Google's offices. Google has offices all around the world. You walk in, it's a piece of Google. You swipe a card, you can see it. Right.
It's like an embassy.
Yeah, it's like an embassy. Starbucks. All around the world, you're in the same place in different places.
Right, Right.
We take that for granted. Right.
So there is probably countries where there's like a thing dividing the.
I mean, Alaska, Alaska, Hawaii. Right? Yeah. Hawaii is 2,000 miles away from the United Continental U.S. but we think of it as the same place because the people there think of themselves as part of the US and the people in the US Think of Hawaii as part of it. Yeah. So really it's that software installed in people's heads that merges them as well as people outside say, okay, that's US Territory versus not. Right. So it's really just writing the right bits to people's heads that turn something. These borders real.
And you are more connected with the people in your online networks in a lot of ways than you are your neighbor.
Those neighbors, exactly. Right. Okay, so now. So now, you know, Indonesia, for example, if you ever seen a map of Indonesia, lots of islands separated by ocean. Okay, but they're, they're the same country. Okay, what if you have lots of islands separated by Internet?
Yeah.
Now they can be the same country. At least think of themselves as such. Of course, for the first one or five or ten or whatever years, they'll be made fun of. Everybody will laugh at them. Right, but who.
And is there like, is it the UN or something that says like, okay, fine, you're a country.
I don't think.
How do you apply to be a country? Because once you apply to be a country, I guess leave this, like, I moved to America. Like, I could be like, yo, I'm not a resident of America, I'm a resident.
Isn't that the whole sovereign citizens thing?
Well, sovereign citizens is. Yeah, okay, go ahead.
They all, they just, they always get tased.
Yeah, exactly. That's right.
That's every video. A sovereign citizen is just them getting tased.
That's right. Because a citizen can't be sovereign. Right. You need a collective to be sovereign. Right. You and what army equals you in what country. Yeah, right. That's a fundamental. So, you know, the thing is, I think, you know, to caricature, the progressive doesn't get the concept of starting new countries, but the libertarian doesn't get why you need diplomatic recognition. You kind of need both. You need both the individual and the collective and you need to fuse them in an interesting way. Right. This is, you know, crypto's also done this. Crypto has made progressives more libertarian and libertarians more progressive. Why progressives more libertarian? Well, you can start new currencies. It actually, this is a big thing. It's like an undeniable movement. Conversely, it makes libertarians more progressive because if you start any kind of crypto thing, you'll immediately realize, well, I need some kind of identity verification. I need some anti fraud. I need to rebuild something that looks much like a state, even if it's a V2 and it's an improvement on it. I need to rebuild certain of the aspects of the old world. Right. So you know, in the, in the best case, both parties kind of learn something from that. The old guy, you know, the old world learns the new world is possible. The new world realizes why the old world had certain things their way. Right. Sometimes you can only learn it by trying it yourself. Okay. I still think progress happens. I don't think you come all the way full circle. I think it's more like a helix where you, you go up a level. It's cyclical on the X and Y plane, but you know, the Z axis, you're going up. Okay, but coming back to the sovereignty thing first, let me give some precedence. Okay. Tuvalu TV domain did a deal with Godaddy. If you've ever registered something tv that Tuvalu is getting some money. Okay.
The country. The country, Yeah, I never even heard that country. But I remember the TV thing. That was a country.
Yes. Colombia probably heard of Columbia Co domain. They get some money for that. Okay. That's a deal that a country did with the company. Okay. Where it's like it's digital property. It's.co is generating revenue for it. It's TLD, it's got the rights to that. Nevada did a deal with Elon Musk for the Giga factory. Okay. El Salvador has listed Bitcoin as a or recognized Bitcoin as sovereign currency. Wyoming has recognized Ethereum based companies, so called daos or not companies.
I have one of the city dao plots of land.
Awesome. All right, so like deeds or whatever. That's right. So just like, just like countries have put their, some of their processes online now they're starting to put some, you know, sovereigns are starting to put some of their processes on chain. Right. Both currencies and in corporations. So those are examples. I just gave several examples of quote, diplomatic recognition between a state or a country and a company or a currency. Right. So it is not unprecedented this has happened. These kinds of deals have happened. There's more I can rattle off, you know, Boeing in South Carolina for example, or Amazon HQ2. Right. Not that these are without controversy, but.
Disney World's almost like it's Disney World.
Was like this and they had conflict with DeSantis and you know, so and so forth on this. Right. So the thing is that once you realize, okay, these kinds of deals are possible between cloud and land entities. Right. Between companies and currencies and communities over here and cities and states and countries over here. Right. Given that those deals are possible, that's like the crypto fiat exchange. That concept goes from just cryptocurrency and fiat currency to general interface between cloud entities and land entities. Right. Okay. And that actually now, now how does that brass tax happen here? Okay, so you have this community, as I mentioned, you've got a hundred thousand people worldwide. They're spread out over a hundred legacy countries, fiat countries. Okay. And what happens is you've got effectively dual citizens everywhere. Right. They're a citizen of.
Only a resident.
Oh yeah, I guess resident of. Right. They're a citizen in. Well they're citizen of, let's say, Fiji or El Salvador or the US or what have you. But they're a netizen of this netizen, right. Of this proto network state. Right? And so the thing is, I'm a.
Netizen of like the porn of like.
Well, yeah, some you'd be proud of, maybe some nuts.
It'd be like one of those ones where you go, yeah, don't put a stamp in that passport.
Yeah, yeah, maybe, whatever.
But I'm actually a netizen of. For Janistan, something like that.
Okay, so. So you're a citizen of X and you're a netizen of Y. Just like you've got fiat currency and cryptocurrency. You have a fiat passport and a crypto passport. Now, at first, these are like parallel systems, right? The crypto passport is not recognized offline. It's just some losers LARPing, you know, whatever, Right? If you can build the number of simultaneous LARPers into something that's not just one person or ten or 100 or a thousand, but ten or 100,000 and doing so over a long period of time. Well, here's where things are interesting. Do you know how many countries in the UN are less than 100,000 people in size?
Oh, no.
But I would guess 17.
It's about 12. Oh, pretty good, pretty good. It's pretty good, right? How many are between a hundred thousand and a million?
50?
It's about 26. Right. So and then if you say between a million and 10 million, it's like another 60. Okay, so most countries are small countries.
Yeah.
Okay. There's only 14 countries in the UN that are over 100 million people. Okay, most people live in big countries, but most countries are actually small countries.
Yeah, yeah, yeah.
So now phrase this way. It doesn't seem that hard to build something in the cloud that has the number of people, the amount of land.
The tax base of one of these small places, one of these small. When you're having, like, big crypto billionaires.
Come in or what have you. Right, exactly. You have talent, though, not just wealth. That's very important.
That was. I think that was this. Sorry. That was the smartest thing that he. That, like, I resonated so much with Chris. You're like the same thing that happened in Canada. It's like everyone just has to leave. Like, you know, so much of, like, the town does go outside the industry right now. And that describes, like, in Canada, they leave the country in entertainment, they leave the industry in, like, Silicon Valley. They're leaving the like mainstream tech industry. Like everything you think of, all of the best people you can think of that are doing the best things are like leaving the like main system.
Well, yeah, oftentimes it's. But I was so like Canada. I remember. I don't know what exactly when, but there was, they were floating around the notion that they were gonna like take Turks and Caicos and it was going to become a part of Canada.
Oh, really?
I remember that it was like probably 15 years ago. I don't think it was far enough. But I think every. Yeah, I get rid of.
Correct.
But everybody like, they were like, we'll have a warm place that we can go.
Wow.
And they'll, it'll. It'll just be like Hawaii. Yeah, like exactly what they do with Hawaii, except Canadian Hawaii. Except not by force.
Force.
Right, right. But so could that theoretically what you're saying with this nation state, where this, this cloud based nation state or network say sorry, would just go and say, hey, we have the resources. Now if there's a country that would like to volunteer for this.
Yes.
But here's become this country with the physical. We use your physical.
Oh, especially if it's like the. Imagine it was like Elon Musk, Peter Thiel and you and like guys like that. And then you go and you're like, yo, Bermuda. We have. Or like whatever, like you know, we have a deal that you can't refuse. We're going to.
So. So I would, I would, I think something like that could work. But there's an important, very important asterisk or, or edit on that, which is one of the reasons that Bitcoin and Ethereum have the success they do is they have dual citizens in every country. Okay. You have American bitcoiners and you have Chinese bitcoiners and you have, you know, French and you have, you know, Brazilian Ethereum and so on and so forth. Right? So these are people who are native to that country, who understand that culture, who speak that language, who are friends there and can argue on behalf of Bitcoin Ethereum as Brazilians or as Americans or what have you in the, in the native idiom of their local culture. The fundamental concept is they're dual citizens. Okay? This is also the same thing about any network state. Those hundred thousand people have subgroups all around the world, right? And so the ideal would be that, let's say you have a thousand Fijians, okay. People, people who are in small countries are particularly good to join network states. Why? Because if you have A thousand Fijians making the case for why Fiji should recognize this network state. That is.
I see what you're saying, because you have, like, let's say you have, like a hundred thousand people there, and like 60,000 of them are like, yo, we want to have this.
Yeah, exactly. Crucially, if the more of them that are members of the country that you're seeking diplomatic recognition from, the better it will be, because it's not just some rich guys from out of town coming in and plunking down. Right.
You know, it's not like bitcoin imperialism.
Yeah, exactly. That's right. So. So the thing is, bitcoin is everywhere and nowhere. And so, as such, there's people from all walks of life in all different countries who have. Have identified with it. Right. So. So this is key for diplomatic recognition is you need effectively dual citizens, like a citizen slash netizen who is making the case for why this benefits. Now, the thing about diplomatic recognition, by the way, is we don't usually think about it just like, I mean, 10 years ago, how much thought did you give to currencies? Not much. It wasn't like a dynamic thing. Right. Now, everybody, at least everybody in crypto knows that a currency has, you know, three properties. It is medium exchange, the, you know, store value unit of account. Okay. And in the same way, if the question of the 2000s was what is currency? The question of 2010, the 2000s, is either what is a country? Or even better, what is a nation? Like, what is that unit? Because that thing in the cloud, even before it has any land, is a nation. It's a group of people that think of themselves as a people. That's what really, this morning.
Ideologically.
Yeah, ideologically, culturally, exactly. You know, like the entire concept of.
Nation, by the way, I mean, on you, on the Internet, you talk about all the time like a community.
A community. That's right.
Most people probably that's more important to them than whatever else.
Yes. The thing is that a community is like. It is. If you take a community and you put it on steroids, you get a nation. Okay. Yeah. And. And the reason is a community could be like, I don't know, Game of Thrones fan club or something like that. It's a loose affiliation. Okay. We all kind of like the show. Something like. Like that. Right. Whereas a nation is basically. For example, you've heard the term nation state. Yeah, okay.
Song by Propagandi.
Well, yeah. Okay. Okay. Yeah. So, right. So, all right, so the term nation state, actually, nation and state Are different. Did you guys know what the difference is?
No.
Okay, so the. The nation, it's like the same root word as natality. It's. It's the people. It is like, for example, the Japanese nation. They have shared language and culture, ethnicity. They're like a group. Right.
And the state's the government.
The state's the government. So they're as different as labor and management.
Okay.
Okay. So you can have the state over the Japanese people. Be like, America in 1946 was like, occupying, you know, Japan after World War II. So there's an American state above the Japanese nation. Okay.
This is an old nation state. When they're both the same.
Yeah. So the old concept of the nation state was different ethnic groups should be able to have their own government. Oh, that is what it used to mean. Right. And that's what gave rise to what we now call France and we now call Germany, we now call Italy.
France was in there, like, gay people should have their own government.
Well, so. So France, actually, you know, the thing is that basically the. What we now think of as France, most people in what we now think of as France did not speak French before the French Revolution. Really? Yeah, they spoke other languages, like, other, like, dialects, things that are kind of adjacent to French. And what happened was the unified government of France installed new software effectively into everybody's brains and just uniformized it.
Here's the curriculum for all schools. And just.
Exactly. So just leveled it out. And there's both good and bad at that. Obviously these old cultures were kind of, like erased. The good was you now had a large unit of people who all spoke the same language, all had the same values, because all being educated since early. Okay. They all, you know, transact in the same currency. And so then France could go and crush all these folks. So that actually led to German unification, led to Italian unification. And so this was like the kind of, you know, get big sort of imperative of the 1700s.
You have that as like a company culture in Silicon Valley probably too.
Right, right. Because if you do. If. If these small little groups didn't group up into a nation state, they would. They'd get crushed. Or they'd be forcibly.
Or fighting.
Yeah. Or. Or fighting. Right. They be. But so. So this. This stopped, in a sense, civil war, because now you had these giant states, but it meant more intra inter interstate war because these guys could fight each other. And they're bigger, and they're bigger, you know, and one way of seeing that there's this. There's a UN country called San Marino. It's this tiny thing of 30,000 people that's in what we think of as Italy. And you're like, what is this thing? Why does it exist on the map? And the answer is it sheltered Garibaldi during Italian unification. And so they, Garibaldi, like, said, okay, I don't have to fold you into all of Italy. You can just kind of be your own thing. So they maintain their sovereignty to the present day. They're like one of the three enclaves in the world. The other is like Vatican City and Lesotho.
How many people live there?
30,000 people.
Oh, crazy.
See how small that is? Yeah, right. So that's tiny. That's like, you know, there's a town on Long island that's probably bigger than that, right? Yeah. And so we get. That's a UN country. So my point is that these UN countries are often, many of them are quite small, much smaller than you might think. They have their status for historical reasons. And so a sufficiently motivated cloud community will. It'll get told no the first time, the second time, probably the fifth time.
The tenth time told no. When you say, like, they're going to what, make some sort of formal pitch.
To the States, United un well, not to the. Not to the UN as a whole. So assume the UN as a whole is very slow moving, but any individual country has a list of those other entities that it diplomatically recognizes. Now, the reason we don't think about this too much is just as I said with currencies, we thought of currencies basically being fixed, and now they become incredibly dynamic. You know, these constants have become variables over the last 10 years. It's not just currency, it's fiat or cryptocurrency. Okay. Things can conceivably go from nothing to becoming a global currency. That happening in our lifetime, as hard as it is. So in the same way, diplomatic recognition we usually think of as a zero or one thing. Either something is recognized by all the 190something countries, UN countries of the world, or none of them we think of as 01. But there are countries in the middle, like Israel, like Taiwan. Right. Which have some diplomatic recognition from some places, but not others.
Ah, that's pretty good point. Yeah. Because you're just like. Taiwan doesn't see themselves as like, not recognized. Like.
Yeah, yes, but. But China leans on countries.
Oh, you're not a country and be like, we are, though.
That's right. So China leans on places to not recognize them. Right. And so what you might do is basically you would you'd actually. There's actually this book called Invisible Countries, another one called Imagined Communities, both worth reading. Right. Invisible Countries talks about all these, like, quasi countries that are kind of hanging out. They're less recognized in Israel and Taiwan, but they're more recognized than something out of nowhere. So like Abkhasia, Catalonia, the Basques, Kurdistan, all these different groups. Yeah.
Catalonia is a big one. Right. They're like constantly trying to.
They're right, exactly. And so the Catalonians, like, at least some of the Catalonian nationalists, like the concept of the network state. Why? Because historically you've only really had two options. Either A, they could be sort of dominated by Spain. Right. Or B, there's some like, insurgency, like Irish type thing. And it's, you know, that's super messy in its own way. Right. So how do they preserve their language and culture and so on? Well, one possible alternative is C, a network state where Catalonians start crowdfunding territory around the world and they give up on this land and this state, but maybe they have some land in some state of their own. Okay. Now this is actually the motivation for the network state comes from Theodor Herzl's book. Theodore Herzl wrote a book called Derjunsat, which translates to as the Jewish state. And he actually, that was the book that led to the formation of Israel. He was basically making a very similar case to the Jewish people. And he said, look, you know, we are a nation, we're a group of people, but we don't have a state. Right. We're a stateless nation, and how can we get one? And he was actually like, you know, look, we're. In modern parlance, he'd be like a tech founder. He was talking about how even in 1897, he's talking about the death of distance. He's like, we have steamships. We can move across large distances, so we could pick from the best spot. Should we do it in Argentina or Palestine? And other places that were considered later were like Madagascar or Birabad Zin, you know, so they were. Go ahead.
No, I was just going to say should have picked Argentina.
Well, maybe. Yeah, exactly. So. So there's, you know, got a lot smoother. Might have gone smoother. Right, exactly. So. But. But, you know, it's hard to know what happened. Maybe there have been some local backlash, whatever, you know, but too many Nazis are going to. We gave our. Who knows, who knows. Right. But that. There's definitely a hinge point in history. Right. Point being, you know, this is something where the cloud community went and found land. Right. Now I'm not saying I'm not a utopian, I'm not saying that everything always goes well or what have you. I am saying, you know, one of the things about the network state is I try to take inspiration from the best of different kinds of states. Right. So Israel was started by a book and it had this kind of reverse diaspora that found land and was flexible on where they went to so long as they could get a state somewhere. Okay. India was started non violently. Okay. You know, it got independent. So I'm buying. That's definitely something to emulate. Singapore has like a CEO founder and they built like this amazing economic from nothing. Right. America, of course, too many influences name but of course it's got its constitution and that's, you know, and all this tradition of jurisprudence and so on.
So when you're start.
Yeah.
Whenever you're starting something from scratch, it's so much easier to just like import. Yeah. Because you, you just like get all this like whatever you're doing, you get all these clutter. You know, Even if it's like a company of like an employee that you're like, he's been working here, we can't really fire him, whatever it is. It's so much easier.
Yeah, you can't, you guys can't fire each other.
And what do you do about like a military, like when you need good questions? Because I imagine that's a question that probably.
So this is something people ask. I'll write about this in the V2, but two, two, three things about this. First is Bitcoin, Ethereum have guard hundreds of billions of dollars without a military. Right. They managed to do that via pure encryption. Mainly because a military isn't actually valuable to steal from them. You can point a tank at something, but no amount of violence can solve certain kinds of math problems. That's Assange's line. Right. So to decrypt these networks and take the money from all these people around the world, right. When you take a look at that image of the network state, right. It looks like bitcoin miners or Ethereum, you know, stakers or what have you for a reason. It's decentralized. If you have, take my example of a hundred thousand people in a hundred pockets around the world, how are you going to nuke that? Yeah, yeah, you can, you can't. And this actually goes back to just.
Nuke their like servers. You can't.
They don't have a server. It's on just individual computers.
Yeah, exactly. So, so the thing Is. I mean, why was the Internet built? Going all the way back to the very, very, very, very beginning of the Internet. Why was it built?
Was it a military just.
Yes, there's a nuclear bomb. Just so they can.
It was. It was meant to have a communications network that could resist a nuclear attack.
Gotcha.
Okay, so that was the original motivation.
So it's almost like, like Vietnam or something where it's like it's hard to win those wars because everyone's just everywhere in little tiny pockets. There's no central.
Things like that, like that. And you know, in some sense, you know, sometimes a technology is so important that it shapes the state itself. For example, the Great Wall of China is this gigantic thing, right. That you can see it from space. That is like an actual gigantic physical border. Right. And you know, the, the invention of oceanic navigation allowed states to become like, you know, ocean spanning empires. The British Empire was not possible before you had ships that could, you know, go across oceans. That was a pretty hard thing to build, right? So sometimes technology changes the shape of a state itself. And as the Internet rises and unfortunately you get more and more showdowns between nuclear powers, right? You're having the US versus Russia, the US versus China. You're having the risk of. Not the risk, the presence of hot war between nuclear powers. That was unthinkable when we were growing up. Right? Yeah. The issue is if you just flip a coin, you keep flipping a coin, you know, you keep rolling the dice, eventually something bad will happen. And so. Or could happen, let's put it like that, right? And so on the other side of that, a network state is nuke resistant for several reasons. First is it's just distributed, okay? And most people don't think about it this way. They just think of a nuke as the biggest, baddest gun. And so therefore someone will submit, right? But that'll only work if it's like a concentrated group of people in one known place, right? If it's a group of folks that are distributed all around the world. If you nuke them, you're nuking a bunch of your allies too, right? You're nuking a building in the middle of nowhere. You're killing all these other people around, around who are your allies, number one. So it's not target enough. Number two is a network state doesn't need to actually have every node on the map being revealed. It can be encrypted.
Oh, yeah.
Okay. So the secret state. And in fact, you go from secret society, secret states, because you can't hit what you can't see. And so now it's something where your private key is.
Everyone's like a ninja, basically.
Well, right. So you go from private property. I mean, basically, put it like this. If you go to the top of some, you know, skyscraper in New York. Pentagon, and you look over all of those windows, how many of them have you ever been at?
Yeah, very few.
Very few, right. In a sense, maybe 40, 50.
This guy's bragging.
All right, sure.
The invite, because I've been to none of them.
Sure, sure, sure. So most folks, only a small fraction. Okay. Perhaps present company. So your passport actually to the US Only allows you to really walk the streets of New York. And maybe, you know, you're. You're really only on the ground floor. Most of what you're seeing is inaccessible territory. You need a second private passport, whether it's a hotel room key or an apartment key card to get in or an office card to get into those little spots there. Right. So most of that territory is actually off limits. It's invisible to you. You don't even know what's behind that.
Uhhuh.
Extend that. Right?
I do, but he doesn't.
Yeah, you do. Okay, Right, So. So. So if we take the premise that most of what is in cities nowadays is digitally gated private space. Digitally gated because it's a key card private space because you can't see in it.
It already is.
Yeah, Right. If that's true, if most of what's in cities is digitally gated private space, we can invert that and say digitally gated private space constitutes most of what's in cities.
Dude, it does make so much sense. Because if you're like, yeah, when you walk by and you see, oh, look at that big thing. That's Google. Like, why wouldn't you be like, oh, look at that big thing? Like, you know, stytown is like, legitimately where I was gonna. There's 5, 000 units. You just be like, oh, that's part of, like, you know, whatever, 8chan world or whatever.
Exactly. Right. And. Or. Or you don't even have a logo. You've. You've intentionally made it. Okay.
Like a key thing.
Yeah, you have a key thing, and it's just opaque to the world because why. Why show it off? It's just like a blank facade attracts no attention. Right. And many, I guess, if people move.
Their girls in and they probably won't leave a blank facade for a while.
Well, it really depends.
Try to soup it up a little.
Yeah, it depends. It Depends. And, and the things start out when.
It'S just the boys, they'll probably.
Well, so, so like the entire San Francisco culture of being a slob. Okay. Has a benefit, right? Which is it's like, you know, you can't tell the difference between a really wealthy person and just like an average guy. You know, you're walking down the street and you're just wearing really the same clothes, but it's the opposite. It's inconspicuous consumption as opposed to conspicuous consumption. Why, you're almost like visually encrypting. Okay. In the cloud you might be 50ft tall. Right. But on the land, why attract attention?
Yeah.
Especially in an untrusted zone. You know, if there's folks who might want to mug you or whatever. Right. They don't even know you have anything. So it's like, you know, like you're invisible to predators or things like that. Right. And I actually think that the world that we're in today is actually an atypical world in the sense of how visible it is. Okay. Signal and WhatsApp are just a harbinger of us moving back into encrypted, illegible environments. All the kids nowadays, you know, what do they do? They have a Finsta and a Rinsta. Have you heard that term Finsta?
Yeah, like the fake Instagram.
Fake. Exactly. So in their fake Instagram they use a fake name and they're the real self. On the real Instagram they use their real name and they're their fake self. So the real Instagram, they're in there.
It's like the one where if you know you're getting a job and you're your goes, what's your Instagram?
You go, Here you go, here you go.
Exactly. And it's in Sunday Best, you know, Etc, Etc. Right?
Yeah.
And on, you know, Finsta is, you know, all the stuff that is. But, but crucially, one of the things they do is they use a search resistant identity on Fin. Right? Why? Because.
What does that mean?
Like, like no name, Something that can't be Googled. Yeah. It can't be linked to them via Googling, only their friends know about it. It's a 12 follower account just for their friends.
Yeah, it's like a private account.
No, no name. Like. Okay, that's right. And, or, or if the name. It's like a made up name. It's this Satoshi Nakamoto style name, right? Yeah.
Who he is?
I have a guess. Yeah, but nice. He's probably, he's probably not alive.
But really?
Yeah, in the community, people think he's Hal Finney. Who's Hal Finney? If you don't know who Alfiny is, I don't. Yeah. Okay. So he's amazing cryptographer who unfortunately passed away and so on. The thing is, I can say that and nobody, like nobody will believe me. It's actually great. You know, and one thing that's interesting is satoshi pseudonymity was actually itself a form of decentralization. You know why?
That's the guy who started Ethereum, right?
No, no, that's metallic.
That's metallic.
Yeah, a lot of things.
Yeah, yeah. So. So you guys are having a good laugh. No, no, no.
The YouTube comments are just lighting up right now.
Is this live? It's not live, no.
But we're keeping that in.
Okay. Okay. So.
So this guy doesn't even know all the.
Every bitcoin. No, no, no. Whatever. It's fine. It's just. It's funny. The. So. So you know the whole concept bitcoin, right, is like the mining and the stuff is everywhere. So it's everywhere and nowhere. You can't shut it down very easily. A non or less obvious point is that Satoshi Nakamoto choosing to be pseudonymous rather than using his quote, real name. A better term than real name, by the way, is like state name. Right. Or official name. It's like government name. Government name, exactly right. Because the non obvious part is synonymity is itself form decentralization because your government name is like a global identifier. Okay. Given Ryan Long. Okay. Someone can punch that into a database like Google or anything else and pull up all of these records on you. Now, your name is not unique. There's going to be others who have that name. Right.
There's a bit of an issue with this Jeopardy. Champion.
That Jeopardy Champion screwing up my SEO.
Is that right? Okay, fine. But. But the thing is that never before in human history has it been possible to pull up every snippet of anybody can stalk anybody with. Given their real name. Right?
Yeah.
And so that is something where, you know, another term for a name is a handle, if you ever heard that, Tim. So think of it as like literally a handle on a file. You know, file cabinet. People can just pull out the file. Right, Right.
And.
And so the alternative to that, to having this name that's at the center of a thousand databases, that's the primary key to look up all this information is to start totally afresh. Right. Have a node over here, Satoshi Nakamoto, that has nothing attached to It.
Yeah.
Okay. And now any attachments to it are those that you have consciously sought out. You know, Satoshi Nakamoto set up Bitcoin Talk, and he set up, you know, like his code base and so on and so forth. Now, of course, the. What budded off of that and butted off of that became this gigantic network. And all this energy, this, you know, is swirling around this, but the man walks unscathed.
Yeah. Because there was no. Nothing linked it to him.
Right. Nothing. Like, these are two totally, you know, the, the pseudonym network avatar.
I remember something Vitalik saying when he, they gave him all the. What was the Shiba Inu or something when they tried to promote the thing.
And then.
So he had to. He donated it all, didn't want it. But he's like, I heard him talking about it. He's like, I had to, to go access it. He's like, I had to call my parents up.
Yeah.
And then he's like, they had half of my key and I had to go buy a laptop that had never been online before. And then he's like, I go online for the one second, like, do this stuff. He's like, throw out the laptop. Like, all just to maintain that, like, I guess, air gap.
Right.
Where you're like, there's no connection ever.
Right. Yeah. So that's like, if you want to be. I do think about this sometimes, because if Vitalik takes, takes that kind of precaution, and I also take, you know, significant precautions. We do need to work on crypto usability, you know, like.
Well, I, I, I did. I co hosted the show once in Toronto and one of the Ethereum guys, I think, Anthony d'. Onofrio.
Dario. Yeah. I might be pronouncing. No, I think you're right.
You're right. He was on the show and he was like, he, he was talking and he had like four bodyguards with him.
Yeah.
And he's just like, yeah, this is my life.
Because. Or you could just like basically be in high security locations. Yeah. And just not disclosure.
Like anyone that has a lot of money, I guess, to somebody. Hey, guys.
Or Asia. Asia is reasonably high on the topic.
Of, like, what you just said, which was one thing we were talking about before you came in here. Like, the, when you're talking about, like, some of it does feel a little too, you know, like, out. I don't know if out of reach for normal is just. Here's a, here's an example. Like, I know a lot of people.
People.
There's a lot of money in crypto. And they're like, hey, we want to have like all of these, you know, make movies in that space. And we want like. And I've been approached a lot of times, right, but. And there's all these people that are. Have all these versions of things that exist, like an entertainment. Right. But like none of them actually in reality anyone kind of uses them to any, like, real.
Yeah.
So it's like they're all theoretical. Well, yeah, it like really, all these people, they're like, we have money and we want to do things. And I think from my perspective. Perspective, it's like, it's not that I'm just not like, I'm not after like a cash grab that.
Yeah.
So it's like, right. There's no pro. Like, what will be the first one where you're like, yo, everyone's actually like watching this thing in there, do you think? And then. Yeah, that's like the first part.
Sure. So. Well, first is. I don't know. Do you remember the dot com bubble?
Yes.
Yes. Okay. So in the late 90s, early 2000s, basically. I mean, this huge surge of energy going into Internet companies, many of them crashed and ended up with nothing. The things that really did keep growing, though. The main thing was just Internet connectivity. People were just getting online. Right. That itself was like a thing, you know. And then over time, a few years after the dot com. Really, 2004. Right. Was when Google's IPO was. And then people were like, wait a second, you can make money on the Internet? For four years, no one had believed you could make money on the Internet because ofthe.com crash. And everyone's focused on 9, 11 and Iraq and all this stuff. And Google showed you could make money on the Internet and then. But Google was like the only one that was doing so for a long time.
Is that Even how like MySpace, like, never really figured out how to make money?
Yeah, yeah, yeah, exactly. Well, so. Well, so Facebook and Twitter got started in the mid 2000s and they were looked at as total frou frou stupid things where, you know, they're also never going to make money. People, you use them but for, you know, they're not going to make money. And it's really only 2008, 2009, after the iPhone and the financial crisis and so on that the modern Internet really took off. That is when Google and Facebook really went vertical in terms of ads.
Why do you think it is?
Several reasons. One is that iPhone. Well, the iPhone was huge, right? That was huge.
Was there like something about like all of, like crashing out all the bad stuff to start again or something.
Yeah, it's something where like there's just a lot of stuff that got built over the 2000s, like open source became better. A lot of stuff that's invisible to the public. Right. Like a lot of backend infrastructure where something that might have taken a thousand lines of code to do was one line. Right. A lot of that type of stuff is invisible. It's backend stuff, you know. So open source stacks got good. Social and search had proved themselves out. AWS had finally worked. A lot of companies tried to do what has become Amazon Web Services, like data center in the cloud before Amazon executed on it. Um, you know, Apple obviously did the iPhone and mainstream media, basically everybody who had been running ads in 2008, mainstream media suddenly had a cash crunch and needed to look for more efficient channels. So necessity brought them to the Internet. And even.
Yeah, that's a, like a big part of it now, right?
That's right. So Even, even in 2008, 2009, like, you know, Joel Stein, other folks have written like, in that era lists of like the power centers of the U.S. silicon Valley was not on those lists.
And how many people were on the, like, the list? It was like 10.
It was like, it was like, you know, the Pentagon, Hollywood, New York, Madison. It was like, you know, kind of what the older institutions of the US.
Were, they always miss it.
Well, so here's the thing. This whole Internet tech thing is basically like about 10 years old. It's very very. It's very young. Right, right. And you know, Uber, Airbnb, it's already.
Like moving on to the next thing.
Apparently on the next thing. So Uber, AirBN, Stripe, they're all basically like 0809, you know, 2010 founded. Right. This whole Internet crazy era is very, very recent. People's memories have sort of been rewritten. But if you go back and look, it was not like that before the iPhone. The interest, I mean, it was just thought of as gadget, I guess.
I do like gadget.
Well, it's like the BlackBerry, which even now, like at the time was the most amazing device because that's, you know, the gold standard. And then the iPhone came out and all of a sudden you're like, this thing is a piece of shit.
I stuck it out for a while.
I know Ryan was like, Ryan's like, I remember that.
You're like, I love the keyboard.
That's right.
So now, last minute keyboard warrior.
So let's take that, let's take that and apply it to crypto. Right? So, you know, the Internet represented a fundamental improvement on just how we deal with information. Right. Things we totally take for granted. You can copy paste. Okay, I mean, that's computers, but just you can copy paste. You can send instantly to people you know via an email. You can search index, you can, you know, everything you can think of that you could do with information you could do with a few keystrokes. Just to put that in perspective again, within human, human memory. Xerox was invented like in the 1900s, I mean, but I mean, not 1900, but like, I think it's like 1950s or 60s. I don't remember exactly when the photocopier was like invented within living memory. Okay, yeah, you couldn't just change the font on a document with one tap. You had to go and like reprint out the whole thing. Okay, so you couldn't change fonts, you couldn't copy paste, you couldn't search, you couldn't like, you know, change color tones, like all of these things.
Stuff that's just nothing now.
Stuff that's just nothing now was a massive effort back then, okay? And, and like, we, we don't really think about that too much because we're sort of, you know, something is awesome. And then within a few months it's taken for granted. It's part of your workflow if it works. Right? So, but, but the, the improvements, you're talking about orders and orders of magnitude on like the speed of transmitting information. I mean, like nine orders of magnitude in some, some cases. Just to give you one example, okay, as you go.
Upload speeds.
Go ahead. Upload speeds, Upload speeds. Yeah, sure. So, exactly. Right, so, but give you one example. Let's say if you go from, from sending a physical mail to sending an email to sending a group email to a Facebook thread, okay, Each of those is incremental, but the combination is ridiculous. Okay, so saying a physical mail to saying an email, well, you send an express, you know, FedEx or something, the highest price thing, and it arrives in maybe like 24 hours. Okay, but you send an email, it arrives in seconds or minutes. The thing is, at that time, you had to spend a huge amount of money up front and the other guy had to spend money, money. So it's like, okay, well, yeah, it's faster, but I have to spend $5,000 for a computer system, an Internet system, and this guy does too. Am I really going to send that many emails to this person as a one off? Seems kind of stupid. You know, so corporations did it for intranets first. Then corporations were sending between, you know, or not just corporations. Academia is doing it and then corporations are doing it. And out of that eventually started to come to the home user in the 90s. So there's physical mail to email. Then you go email to group email. Now you can send a reply all thread. Okay. Now you go from reply all to a Facebook thread where people can reply and post messages. Thumbs up, whatever fog.
You all do.
Yeah. Okay. Right. So now you take this and I haven't posted on Facebook a long time or Twitter, whatever. Take a Facebook thread. You compare how expensive that would be to do with physical mail. Okay, let's say you've got 300 people on in your Facebook thread, right?
Yeah.
Okay. Imagine taking 300 picture postcards, licking, sending stamps to 300 people. Two of them come back, one set. And each one of them, when they want to make a comment, okay. They come back to you with LOL unfollowed or something like that. Right. They mail it back, and then you have to rebroadcast that out to the other 300 people and get. And. And just keep doing this. All right, like, what is it called?
Polaroid.
I mean, to think about something like even this right now, like, the people are watching this on YouTube and then there's that comment section below.
Yeah.
On top of essentially like a network.
TV station come to your house and yell at you.
That's right. That's right. So. So. And like just within living memory, I mean, you know the Unabomber, right? The Unabomber. Do you know why. You know why he killed all those people?
Yeah, that. It was something with. I watched was the government.
He. He killed all those people to get an op ed in the Washington Post and the New York Times.
I did not think of a different bomber.
Yeah, okay, different. So. So the Unabomber killed for the distribution.
But didn't the Unabomber have the big manifesto that.
Oh, yeah, that's the same guy.
Okay. That manifesto wanted to post this big manifesto. Okay.
Yeah. So in the early 90s, distribution of your concepts, your words, et cetera, was so scarce that he had to kill multiple people. So he thought to get the distribution.
Yeah.
Okay, now you could just have a podcast.
We know a lot of people with a manifesto, probably, that are posting online every day, and they're still thinking, like, do I have to kill a guy?
Well, well, right. So the thing is, of course, too easy. Of course, it's both bad and good. Right. Essentially, there's a Lot of people who won't kill somebody, but they certainly will troll somebody, and that's a lot of people on Twitter. There might be a thousand x as many people who will do something insane and stupid and mean and angry for distribution on Twitter versus those who actually go and kill somebody. So that's obviously the bad part. The good part is that distribution has opened up in a dramatic way and now everybody can have a podcast, a TV show, etc. Etc. Right. What's my point? Putting it together.
Yeah. How does it look like on. In the future on the decentralized world?
So once we have seen just like the degree of the exponential on the Internet and computers within our lifetime, you know, it's like, as I said, this thing is 10 years old. And even during the 2000s, the Internet was basically mostly dismissed. Like people were on the Internet, but it was not the center of all government and so on and so forth. Like, you know, politicians who they. They thought of the Internet as kind of this swampy thing. They're sort of below them and, you know, they were on dark web. No, it wasn't even the dark web.
But that's how they viewed it almost.
No, it was, it wasn't. It wasn't yet coded as malign because even in 2008 and 2012 is like.
Clunky and like, like a hobbyist.
Facebook. Yeah, Facebook helped Obama get elected, if you remember, in 2008, 2012. And Facebook was really good, considered good by The Press in 2008 and 2012, because it did so. Right. So the Internet was either harmless or cute, whatever. It wasn't like the real affairs of state.
It was just the wrong guy elected.
Well, okay, right, so now. But actually, even before then, even in 20, 2013 is when the attitude shifted because by 2013, you can no longer deny that the Internet was. It was crushing. Old media revenues dropped from like 67 billion to like 17 billion in like, you know, five years. There's this graph by Mark Perry, like print media disruption. So Google and Facebook took all this revenue. Google, Facebook, Amazon, Apple just all went vertical. Right? And you know, that caused, yeah, they.
Weren'T happy about it.
Them to be unhappy. And so these guys who, you know, in the mainstream press, I call them now, you know, I don't call them the mainstream media. You know, I call them downstream media. You know why? Because they're downstream of the Internet, the downstream of you guys. Right? And they're literally just reposting tweets and you know, so on.
Not your grandmother's media. It's like literally your grandma.
Yeah, my dad doesn't even get to the paper anymore.
Yeah, exactly. So. So the downstream media, basically at that time, they couldn't.
Downstream media love it.
It's good. Right? So they, they couldn't, they couldn't build search engines or social networks, but they could write stories and shape narratives and you know, the difference in a story.
And a product release, like ones, ones by the person that did it.
Well, this is kind of a one liner. The story has a bad guy. Okay. And so it was a bad guy. It was tech guys. How about that? The guys who just bankrupted and disrupted all these media companies, suddenly they were cast as the villain. And so from 2013 and 2019, 2020, all of these journos were just looking for.
This is funny because it sounds like pedos. Like it just sounds bad.
Yeah, yeah. So since Jordos. Right. Basically were going after all these people in tech, whether they were the. An engineer who just made some off color comment, whatever. Yeah, exactly. And you know, I mentioned this. It's like more accountability for somebody's old tweets than all the wars in the Middle East. Right. You know, so it's just like hunting these guys, right. For clicks. And that carried on for basically about seven years. And what it led to, among other things, was the wokifying of Microsoft, Apple, Google, Amazon. That's actually MAGA versus Maga. That's other Maga and Mark Zapple Google episodes. Right. Is that good? Right. So MAGA versus MAGA is what we're shaping up, right?
Yeah, with like no accountability too. Because it, like it really is. That's the. One of the things is once things get big enough that people can be wrong as many times they want and like, doesn't matter where it's, you know, in any sort of newer thing, it's. You're actually like graded on your accomplishments or whatever. But I guess I, I'm solving for the wrong. They're like solving for one thing without caring about all the other things.
I thought about this a lot actually, and I was like, how is it that these journalists could be so wrong about everything? They're wrong about Bitcoin, the wrong about Iraq. I mean, there's this book, actually everybody who's watched this podcast should read this by Ashley Rensburg. It's called the Gray Lady Winged and just goes through the New York Times history and you're like, wow. They, you know, now they're all staying with Ukraine. You know what they were doing in 1932, 1933. Choke out Ukraine.
Really?
Well, Yeah, I think it'll hold them more. Second Ukrainian famine. Yeah.
Because it's like. Well, tell me if you agree with this, but it's almost like we're saying that the journalists are wrong about everything. But it's almost like the politicians and like those people are kind of wrong about everything. And they're like their press secret.
It's both. And it's both.
Yeah. Maybe they work together.
Yeah. So it's like it is something where at different times in US history, you can argue that one was prime and the other wasn't right. Nowadays, I think, you know, the term the US establishment is better, I think, than the term the US government. Because first, people can't deny that a US establishment exists. You might deny that a deep state exists. You cannot deny an establishment exist. An establishment does exist. Second, the term establishment is inclusive of, but not coterminous with government. Right. The government is part of the establishment, but there are establishment grand days who are not actually government employees.
Grand days. That's great.
Yeah. Right.
And so these are an establishment grande.
Right. So you have, you know, the dean of Harvard is definitely like, you know, part of the establishment, the sales. Arthur Salzburg, the publisher of the New York Times. Absolutely part of the assumption, albeit not the US Government. Right, yeah. So these are one way of thinking about it is the control circuitry for the formal government lies outside of the formal government and is itself resistant to the democracy it claims to support. For example, Sulzberger has like dual class stocks. So he can't be actually, you know, there's no. Hostile takers are very difficult. Right. Or you have a tax exempt foundation like, like Harvard. Right. Or you have something where it's a regulator and they've got career tenure, or you've got a professor and they've got tenure. Right. So these guys can't be, you know, they're not electable to the electorate or the market. They've got these, you know, protected positions in different ways. Whether it's tenure or it's tax exemption or it is dual class or something like that.
They're actually successful if you just understand what they're optimizing for.
They are. Exactly. And they're optimizing for power, not for being correct.
And if you own the New York Times, right, Like you have the power to kind of just dispatch the people who don't agree with you.
Well, so just on this topic, right, like, you know, Mark Zuckerberg, you may agree or disagree. I don't agree with every decision. He's made. But I do admire him because he is the son of a dentist, right. Who. There's a lot of people who went to Harvard. He's way more successful than basically a lot of folks combined. And he built the whole thing, you know, so Zuckerberg built his fortune. Okay. And people all recognize his face. Okay, if I say Arthur, Arthur G. Sulzberger, do you recognize his face? No. How interesting is. Yeah. Or his name. Exactly. So Sulzberger inherited the New York Times company. And it is a company, it is a publicly traded company. It has dual class stock. And when you look at the New York Times, if you go, if you go and Google, for example, how Punch protected the Times, you'll see Joe Nacera in like 2012. Talk about how great it is that the New York Times has dual class stock. If you then Google how you can't fire Mark Zuckerberg's kids. Kids, you'll see a different New York Times writer talk about how horrible it is that Mark Zuckerberg has dual class stock.
Yeah.
So dual class stock is good when they have it and bad when they don't have it. This is when I remember thing I was saying where it's like, basically whatever is good is that. That supports the social network. Whatever is bad is that which is against it. Right. So dual class itself is. It is essentially what it is, is a. It's an old tactic. It's a universalist argument for particular ends. This is the same that the Russians did during, you know, the, the Soviet Union. The universalist argument was communism. The particular end was the expansion of the Russian empire. Yes. And so this, you can generalize it as talk left act. Right. Okay, let's say you're Evil Elon Musk. Okay. Evil Elon Musk. All right. What would he want to do? He would want to. Well, okay, sure, but Evil Musk would want to export strikes to General Motors and Ford. And so. Right. All of them would be riven by internal dissension at each other's throats. You know, they're not shipping anything, you know, like, blah, blah, all this labor unrest. Right. Well, his company practices a Nietzschean variety of aligned capitalism. Okay. And if you look at someone like Salzberger, right, you know, his newspaper talks endlessly about like, white privilege. White privilege. This is like the ultimate privilege. White. You know, he's got this giant mansion which somehow is not in the paper. His face isn't in the paper. Okay. And you know this thing about, oh, people are bad for going to Europe, know, taking their kids out of public school. These guys all go to private school, right? Yeah.
They don't even know what a public school is.
Yeah, exactly. And so the thing is that it is. It's something where you really need to, like, play the man, not the ball, you know?
Yes.
And because what they're saying, they'll talk left, they'll export left, but they will practice the most like, ruthless capitalist kind of thing, like out of a. Out of a caricature that you'd ever find. Right. And, you know, this is something where now people in tech in particular are seeing this because people in tech are basically self made, right. Zuckerberg built his fortune, Sulzberger inherited his. The thing about, like these old media grandees, right, These, they're basically. I call them the meritless nepotists, right? Because they have no merit. They literally inherited their fortunes, their newspapers, etc. It's not that they get great coverage. They get no coverage because they're in.
Charge of the coverage.
They're in charge of coverage.
And I'm sure if some other, like, paper magnet want to start some war, it benefits nobody. So then they both keep each other's names out of them.
But Zuck for all. Yeah, Zuck for all his faults, and all the tech people, for all their faults, have given everybody a voice. Right? That is what the establishment hates so much. Right. It is not that, oh, this is a threat. Democracy. What they hate is what we would call democracy, the voice that people have now. All these people around the world have a voice. They hate that. They're not against filter bubbles. They're against the plural filter bubble. They want only one filter bubble, which is like old media or whatever. Right. The halcyon age of, I guess, 2007. You know, if the MAGA guys want to wind back the clock to 1950, these guys want to wind back the clock to like 2007 or something like that. When they were still dominant and tech was just making gadgets. Right. But there's. There's so many more shoes to drop, you know, have you seen the AI content creation?
The, like the Dolly.
Dolly.
We were just talk. Because I saw your tweets yesterday.
Yes.
And. Well, we were just. Well, because, yeah, I have Dolly and it's really cool. The whole thing is. Is amazing. And I can't imagine, like, how much better it's going to be in a year from now. But we were kind of talking about, like, where. What other stuff is this going to.
Yeah. How does like that look like kind of moving forward?
Do we have any Sort of career as comedians and podcasts. 10 years.
I think they become tools more than competitors.
Yeah, it's like, I mean, think about. You have Photoshop and you have copy paste. And so, I mean, Photoshop actually does some really.
I've had ideas for what would be an AI thing forever. That I didn't have the idea to do it, but I always thought a music video app where. And I'll say this in five seconds, but like, imagine like if you're a kid, you take the music video. It takes forever to people learn how to edit and edit and like all this stuff. But they're all formats. So basically you film yourself singing the song four times, then you film B roll of yourself, like doing a move, and then it just makes you a music video.
Yes. Yeah.
Like, do I like those. Like, that kind of stuff could be like, what if I just did this and then my thing edits it for me? Or you.
I mean, or you could just do like in the style of Spike Jones or something.
Take a look at Runway ML. Okay, so that's doing kind of what you're saying. You type. And it's like, I thought about this concept a long time ago, actually have a spec for it called the Screenplay Compiler, where you write a screenplay, you hit enter, and it's like lights, camera, action and so on. And I had thought of it as instructions for something like Unity, which is like a 3D, you know, engine or whatever, right? The new VR, the new, rather AI stuff is way better than that. Just makes it. It just makes it right because it turns it into like a natural language description of the thing. Okay? And what that does is it does.
Terrible news from Jim from the office.
Well, so here's what it does. It decentralizes Hollywood, right? Like if old media, if it's already been happening. That's right. If the downstream media was sucking wind before for this is just going to finish it, right? But now what's going to happen is a kid from Nigeria, a kid from Brazil, a kid from India, people from anywhere in the world can now tell their own stories in their own language and their own voices without going through like, you know, basically American media corporations, right? So this is this powerful, decentralizing thing where. And that's what they actually hate, you know, and so they'll always talk about how, oh, AI ethics requires us to centralize it and have some, like, token diversity. For example, there's one AI company which is actually a really. Got a lot of smart people there, and I respect what they've done. In other ways, but they make it so when you type something in and it's like a. You're asking for a fireman, they'll just add like black, Hispanic, Asian, as, as words to the end of it that you can't see or edit out. And it just generates like images for you because now you're diverse. It's like forced diversity. Right.
That's so funny that they coded it in.
Yeah, they coded in. But it's like, it's like the most cartoonish, you know, like caricatured version of it. Because let's say you're in Japan, you might want Japanese people. And I knew, right. Or you know, there's different people in different cultures, have a different notion of what's in, of course.
But like imagine you're like, hey, I want like a race car driver and then gives you a girl. You're like, you know what I meant? Well, like, stop it.
Yeah.
Danica Patrick Ryan.
Yeah. So basically, essentially what it is is it's something where true non discrimination requires decentralization. Right. This way, basically everybody can have something that reflects their own culture without it being like centralized, you know. Yeah. And I think that is really the sort of winning argument on this because otherwise what you've got is these people who will argue that for the benefit of the world we need to centralize all the power. Right. To defend equality, which is like almost.
The people with the power.
Well, exactly.
Nobody is without the power.
That's right.
And always it's like, also I should be the one that has it.
Exactly, exactly. AI ethics. That's exactly right. AI ethics as it's currently construed, of course, even the term is basically a stolen base. Who are you against ethics? Are you unethical? Right. So you know, instead I call it, or you call it AI bias, not as the study of how AI is biased, but as a study of how to bias AI. Okay. And so AI bias is basically something which argues. Argues that in order to maintain equality, everything must be centralized at Google or a few of these companies. But of course that degree of centralization of power is itself unequal. Not everybody has that power. Right, yeah.
To influence the AI.
That's right. So power in a. Exactly. Is right. So power inequality is maximal when it's centralized. Right. So the decentralized argument is like there's things like so called stable diffusion, which actually is open source, anybody can run it. Right. That is I think the winning argument on this. And as opposed to. I can find it humorous, I think you're so Right.
Because even if you look at, just from a moral argument, it would be like what you're saying. They're saying it's like, well, we needed to have all these things. But it was like, okay, well, why wouldn't it be that? Like you said, like anyone living in India. And they're like, well, it has to be diverse people in America. You're like, you're already even by that definition, like, broaden it out one more, more like level. And you're wrong now.
That's right. And so here's the thing. Like, I actually do respect people who are like, talk left, act left. I think they're actually consistent. I may not agree with them all the time, just like I don't necessarily agree with people who talk right, act right, but at least I think they're consistent. And so in this context, like v1 would be like an American guy who's like, why can't we have Rocky and Rambo and so on and so forth. V2 has a superposition of two kinds of people. There's a genuine person who's like, why can't we tell more inclusive stories? And then there's, in my view, a non genuine person who's saying, why can't we tell more inclusive stories in order to centralize the power and the money at that company. Okay, now how can we give the genuine person here and the conservative what they want?
And there's a third one of the person that's like doing it but for someone else and they don't realize it.
Sure, sure. Like a pawn or something. Right?
Yeah.
So the thing is, for the talk right, act right and talk left, act left person, I'm sympathetic to both of them.
Them.
And I think the V3 is decentralized.
You can be both.
Exactly. So the conservative can get their Rockies and Rambos and so on and so forth, but we can also tell the stories, allow people around the world to tell the stories. Because I don't think conservative actually doesn't want that to happen. They just also want their own stories. Right, yeah.
And then the other people could get the girl Rambo.
Yeah, exactly. You know. Right. Because, you know, if you were, if you're growing up in the US and you know, you, you didn't see yourself represented. So I actually am sympathetic to that, though I don't think that means you have to like on white guys for that. Right. We can solve this problem by giving everybody their own compiler and letting them tell their own stories. Right?
Yeah, because it doesn't. But then they would Say, well, not.
Everybody can tell their own stories.
And then I'd say, that's patriotism.
They start playing that whole game.
Yeah.
That's why I always, like, say that I'm like, such a fan of the way you talk, because it's like. He's like. They're like, well, not everyone can tell your stories. He's like, well, here's how.
Yeah.
Like, it's not. It's like, yeah, you're right. And that's what I'm like, changing.
They're like, but I like being a vibe victim.
And they're like, yeah, well, you're right, because they are just like, all right. Well, we actually like being able to say this.
Yeah, yeah. So. Right. So. Exactly. So. So. So. I think, you know, insofar as I think a lot of things are like this, by the way, where there's sort of like a V1 that kind of assumes an American default, then there's this kind of intermediate stage of whether you call it woke capitalism that is faux inclusive. Right. And then there's true inclusivity, which is decentralization, which actually gives the genuine people here and the genuine people here secure something while taking power away from the centralists.
Kind of like sports, really.
It's like, who's the best?
You know?
Yeah, go ahead, tell me about that.
Like, no, I was just like. I was saying that, like, that's the most decentralized industry in terms of, like, you know, or at least who's equal.
Well, it's interesting you said, because if.
You go running, like, to some degree, it's like, I. I think it's gonna be hard to find another one that's, like, probably closer in terms of, like.
I think golf is a good one. We're like, you know, whoever in golf, whoever is the best that day, like, was the best.
No, because then known people don't play golf.
You know, I guess it's funny you said so. I. I mean, like, historically, golf was considered a very hoy toy thing because, you know, course and that's expensive and so on.
Yachting and.
Yeah, yeah, yeah, yeah. Yachting, golf.
Very inclusive.
No, running. Running is definitely very inclusive. But the thing that's interesting is use the term sports for that. And that's why I was like, kind of, you know, because I would call that athletics or something. I think the whole era of spectator sports of, like, fat people watching fit people is ending in some ways. Or it's declining watching fit people. Right. It's funny. Yeah. And so instead we want. It's like the participatory stuff, right. Like where people go running together, they go lifting together, and you know, now it's. It's something where, I mean, whether it's like runkeeper or, you know, apps like this, I sort of want to see things where, I don't know, like a fantasy football league, but it's a, A fantasy fitness league where folks are like competing to kind of, I don't know, reduce body fat or things like that, and so they're actually getting some benefit from it rather than just drinking beer and cheering somebody on the couch. I'm not completely against that. I mean, that can be fun or whatever at times. Right. But it's also something where it's not actually benefiting the person who's doing it, whereas this is actually compounding their fitness.
That's true. I guess a lot of people, like, I have a lot of friends that like, that's just their event that they, they get together and do. And if it wasn't that, it would be whatever else it was.
I'm not against that. I'm not, I'm not like, I'm not anti that. I. I am how. I. I do, however, think that going from that sort of era of like circuses to one where it's like individualized fitness and it's actually gaining you some benefit while doing it is. Is better. Right?
I guess.
Always.
Yeah, but.
And if you've got spare time, you'd rather spend an hour on this versus that this compounds for the individual versus this is just entertainment. It's entertainment budget.
I know you're kind of running late for dinner, so.
It's fine. One thing I want to talk about is your woke versus racist video, because I think it's way deeper than you might think.
Okay.
Okay.
Well, yeah, like. Well, tell me what you think.
All right. Great, great.
I'm sure everyone, like watching this knows it.
Sure. So. So you know, this video, if you guys want to watch, I mean, I was extremely. Well done, actually. Both of you are in it. Okay. It's pitch perfect. I laughed, I cried. No, but the reason I thought it was actually perhaps even more deep than you might think is have you seen the Political Compass? Yeah, right. You know, so it's got like authoritarian left, authoritarian right, libertarian left, libertarian right. Okay, now to first order, what you can do is you can say that's like communist, fascist, woke, anarcho, capitalist right in terms of the extremes of each of those four quadrants. Okay. Yes. And one way of thinking about the last 150 years or so is almost like a Z. Okay. Communism happened first in part as a reaction to communism. Fascism arose, at least it styled itself as opposed to communism. And then in part as an opposition to fascism, in large part anti fascism, antifa wokeness, whatever is down over here. And as an opposition to communism, you have ultra capitalism down over here. Here. And also as an opposition to antifa, you've got. So this is the next shoe to drop. Like bitcoin maximalism, ultra anarchic capitalism is kind of like an opposite.
Oh, I see what you're saying. So if you look at. Just by virtue of like a pattern, like just straight up, like pattern recognition, you're like. Even then it even looks like it's going to where I'm saying.
Yeah, so it's something where the, if you take the political compass, the diagonal axis here, the WOKE and the fascists are obsessed, as you point pointed out, with the same things and often come to the many of the same conclusions or. But from the premise, you know, the fascists will say white people are the best and the woke will say white people are the worst, but they, they're just obsessed with race and violence.
Categorization.
Exactly. That's right. And then conversely, the other axis, other diagonal is the economics axis. Right. The political power axis. Right. And you know, the communist and the ultra bitcoin maximalist think, for example. And you know what bitcoin maximalists are, you're going to hear a lot more about.
They're just like, they think that what. That bitcoin is just.
Yeah. If the, if the communist has replaced.
He's exposing me with these questions.
Yeah. So let's say, you know, basically each of these four corners you can kind of see. Right. The. The communist has replaced. Okay, this is, let me put it like this. There's some folks who have replaced God with gov. Okay. The maximalist has replaced gov with btc.
What's gov?
Government. Okay, okay. So some have replaced the, you know, like God with the government.
Oh, okay, yeah, 100.
And others have replaced it with bitcoin Government with Bitcoin. And if you, if you really want to be flip, it's like the, the communists have replaced God with gov. The fascists replaced God with DNA. The wokes replaced God with blm, and the Maximus have replaced. Replace God with btc.
Yeah, gotcha. Like Michael Saylor.
Yeah, that's right. And so the thing is, of course, like blm, the organization is different than black people because basically, you know, lots of black people don't support, you know, like Riots and stuff like that. And just like, you know, like the fascists claim to speak for white people, but obviously lots of white people don't support fascism. Right. So these are things where they are like these extreme corners that are kind of focused on. There's basically two buttons you can push to make humans insane. And those are like the race buttons and the economics buttons. Right. The race buttons is I'm being discriminated. If you just think about it, right in this corner, I'm being discriminated against or I am like the supreme, you know, race or whatever. These things make people insane. If you push these buttons. Right. And doesn't have to be like, you know, white people alone pushing those buttons in many ways. China.
Yeah, a lot of it's just like a single like, you know, palatable answer for. For why you're having problems right now.
Yeah, exactly. And so China's pushing this button of we are the supreme Han race or whatever. You know, pretty hard up over there. Right. Conversely, the communists and the maximals, this is less discussed, but you're going to see this happen more and more. Okay. If you think about what wokes are doing, they're going and accusing everybody of being racist, sexist, homophobe, etc, without any evidence. Because there's no penalty for a false accusation. There's like blam, blam, blam. Just like firing bullets at people. And if it connects, great, they've got a kill. Just they gain status and if not, who cares? There's no penalty for a false accusation. Right. What you're seeing now is you're starting to see the emergence of community that doesn't call people racist, they call people fraud, scammer, Charlotte and shill.
Grifter.
Grifter, exactly. You're starting to see that ramping.
Yeah, you totally are.
Okay. And that.
Good point.
So rather than accusing people and then.
You see the right who's always like the left four years ago calling them being like you're or like you're actually saying sexist or like.
Yes, that's right. That's right.
Like the pedophiles or like they're just trying to. They're always like four years behind like doing their.
Exactly. So. So just like if somebody goes left, you go right. If somebody is pushing on the race button, people push on the economics button or pushing on the economics button, they push on the race button. Okay. So when the communists push the economics button, the Nazis push the race button. When the wokes push the race button, the Maximus are going to be pushing the economics Button. Okay.
Yeah.
And Maximus and Communists you may not know about.
How does Maximilians push the economics button? Is that.
How's it supposed to come.
You're a fraud to try to take your.
Like, the fiat money is worthless.
Well, so, okay, so both the Maximus and communists. What do Maximus and communists both believe? They both believe that most CEOs are frauds. That, you know, that everybody's out to kind of, you know, like, defraud you, that your money is everything that you need to be distrustful, and so on and so forth. Okay? The communist thinks the answer is for the government to take all the money. The Maximus thinks the answer is for the government to control none of the money. Okay. But they overlap on lots of things. For example, because there's only 21 million bitcoin, many maximalists believe deeply that one person's gain is another person's loss. If you're getting bitcoin, like, so you don't see crowdfunding very, very much in the maximalist community.
Right? Because there actually is a zero sum.
There's actually also because. Yeah, they're always like. Because they'll always say, like, hey, you can. In El Salvador, you can buy a cup of coffee with bitcoin. And they're like, why the hell would I want to buy a cup coffee with bitcoin?
Well, it is, it is something where they, they will, you'll frequently see, see maximalist will talk up some product because it uses bitcoin, but not actually buy with it. They want people to sort of be billboards for bitcoin. Okay.
But they want. They're just accumulating.
Only by the way, I say this pretty similar. Okay? So I say this as somebody who's like a huge bitcoin proponent. In the same way I can get along with a liberal. I can't. In fact, in many ways, I am a liberal. I can get along with liberal. I can't get along with the woke. Right. A liberal is somebody who's like, you know, donating their time to, you know, like, people and actually doing good deeds. Awoke is someone who's burning down, you know, black businesses because of what they saw in the news. Right. Like, and a lot of ways you're.
Like a. Yeah, because you're like a builder, not like a terror down.
Yeah, exactly. Like, like, you know, can I get behind equal treatment under law? Absolutely. Can I get behind that, like, perversion of it, which is, which is like in the lower left corner? No, I can't. Right. And so in the same way, like, so I Didn't mention one, which is a zero sum. Another is the premise that all companies, all banks are scams no matter what. The communists and Maximus both believe this for different reasons. The communist believes.
Yeah, that's. Yeah, yeah, yeah, yeah, yeah.
Okay. So, you know, the communist obviously believes it because, you know, these are corrupt capitalists and so on.
They believe the government's bailing them out.
The Maximus believes it because the government is bailing them out and giving them money.
Yeah, they get to.
They call it can't lose. Yeah. All millionaires games rigged. All millionaires are cantillionaires. Have you heard that term?
What's that?
No, a cantillaner is somebody. So the Cantillon Effect is a real thing where when the government prints money, it doesn't land in everybody's pocket equally. Some people are close to the spigot and benefit from it first.
Oh yeah, there's. Oh, I see. You were talking about how it depends on where you are placed in the economy because sometimes by the time you get it, it's been four months and now the price is.
Price all gone up. Exactly. That's right. And in fact, actually this is a big part of the impoverishment of the red states over the 2010s. If you. There's a. This actually came out before the pandemic.
Oh, all the red states. Because it was.
They didn't get the money. They didn't get the printed money. Okay.
Because all the money goes to the like, you know, finance people that they're like operating like that.
And then. So. So here's what happened. Here's. Here's, like this is. See, the thing is we can't. It's not like a blockchain where I can actually track it and do the forensics on. I can't prove this yet, but maybe somebody, you know, can put together the numbers and show. Call this a hypothesis. Right. But basically, if there's an article in actually the Journal, Wall Street Journal, which is like. I think it's like Democrat and Republican live in different worlds. Here's the numbers like 2019. What it showed was that like in the 2000s, there are roughly equal numbers of prosperous and poor, Democrat and Republican districts over the 2010s. By now something like 26 out of 27 of the most prosperous districts are Democrat. There's been this enormous shift, right. Where the districts that are the wealthy districts are Democrat districts and not over here are. Okay, like essentially Republicans suddenly just collapsed and went down scale. Why did that happen? One thesis is that the printed money of DC went to financiers who also invested some in tech. It's only a trickle in tech, by the way, because like venture capital is only a tiny fraction of what's in the old, old money world. But some did go into tech. Okay? And so you had New York and D.C. and tech, Silicon Valley and so on. Those were actually rising in as zip codes over the 2000s. Whereas all these guys in the center, you know, all these red states were getting effectively diluted down without even understanding what was happening. It's as if you had a cap table with a million shares and like 10 million more were printed, but nobody could see it happening really. And then, and it got awarded in such a way that it diluted this guy down who had 50% down to like 5%.
And he didn't even know about it.
Till four months, till his prices were going up. And suddenly the dollar is going less and so on and so forth. And it's not even, it's not visible to him. And it's deniable because it's all happening. It's not on a blockchain. You can't actually see what's going on. Okay, now this was actually up to 2019. Now in the 2000s we've had even more insane amounts of money printing that make that look like, you know, 1:1, 10 of what is happening now. Yeah, okay, there. And so, so I think you're going to see this even exacerbate to a great extent. And so what happens is you have maximalists who will argue. And again, I, as I said, I'm sympathetic to these arguments that all millionaires are cantillionaries. Why? Because they just benefited from this printed money. All banks are bailout, bailed out banks. They're not legitimate. Right. All these fortunes are illegitimate. All these companies are scams, et cetera, et cetera. Right? And the entire economy is zero argument for that.
Them be like, hey, if I was going to, you know, it's like if you enter an industry and then you enter an industry, their industry, where they're like, yeah. The argument be like, yeah, that's part of the game. You lobby the government and get them give free money. It's like you're like, that was part of the game, like going in and now you're saying like, oh, they have an unfair advantage. You go, yeah, that's why we went.
To this like, you know what I mean?
It's too big to fail stuff where.
It'S like, yes, so like I'm I'm.
Not like yeah, it's good over here become a bang.
So. So I'm, I am generally.
I, I understand, I'm not saying I necessarily think.
I'm just saying like I, I understand that argument. I think the problem is basically I would argue that the government has so much power that lobbying it has ROI. You know, that's like actually the problem. It's like 500k of lobbying gets whatever million of ROI. Right. That's actually the bad part I would argue. But so just continue. So the Maximus A zero sum. Okay. B, they think every millionaire, every bank and so on is corrupt because of this. C, they think they will call everybody fraud. Charlton Shill, scammer, grifter. One other thing is maximalists. Even more than they hate like you know, in some ways fiat currency, they hate so called shitcoiners. Right. What's a shitcoin?
The Luna guy.
Well, well, so that's the thing is anything see. Okay, so let's talk. Okay. Right. Perfect.
I thought the max you say anything that's not bitcoin is a.
See you guys gave. It was perfect. What you just did was perfect. You know why?
Because he lost his house in Luna.
Right.
Because the second one.
Well, because what would somebody define a racist as? Some people would say a racist is genocidal Hitler. Etc. Okay. Some would say it's a person who asks you curiously what country you came from. Uhhuh. Yeah.
Where are you really from?
No, but not even that, not even that. Just like making conversation on the bus or whatever. Right, right, right.
Whereas the use. It's the equivalent is someone says a scammer is the guy that like nefariously like you know, takes grandmother's money or.
Somebody who likes Ethereum. Yeah, yeah. Okay. All right. So. So like part of the. This is actually pretty interesting, right? I love it. Yeah, the, the spectrum is intentionally something where it's so wide to encompass the most innocuous of behavior. I mean look, we've seen all these articles like you know, Buzzfeed are specialized, you know, Cheerios is racist or whatever. Like you could probably just do. You should do a show by the way, where you just take 100 headlines, 200 headlines. Oh, you have that video that looks.
Like a pretty viral one.
All right, okay, I'll go watch it. Basically, the most ludicrous things, any one of them that charge. Maybe you can read the argument.
I did a how to blogging too and like take all the things. But I showed all the articles and.
Be like here's how to Argue something is racist.
No, it'd be like you have like a. One wheel, that's like a noun. One wheel, that's like, like the verb. Yeah, yeah, yeah.
Oh, is this the Buzzfeed, like, throw the darts thing? Was that you guys?
No, it was, but it's like a. It's like a game. But basically at the end of it, I used all the real like.
Okay, yeah, yeah. Okay. So. So the thing is that part of the game here, for them, even though it's not like conscious, is the spectrum is so wide that encompasses all normal behavior, and then you can get tagged as racist and then boom, you're in the same bucket as like Hitler or whatever over here. Right, right. So in the same way, when I'm maybe himler. Well, yeah, okay, right. So that's like, that's like the biological, like attack or the race attack. Then on the other side is like the economics or government attack. Right. And so that is something where, okay, there's like an actual fraud or something. And there's like somebody who likes Ethereum or someone who set up a company wants fraud. Right. You know, okay. And might say, why? Why will fraud expand to everybody who starts a company? Well, now here's where you'll have to. Well, so it is effective. But here's where you'll have to. You kind of, you'll have to believe me here, or at least take this as, you know, ad argument. Okay. Every company is an Internet company today. By 2030 or 2040, every company will be a blockchain company. Because payments, incorporation, equity, wire transfers, crowdfunding. Every operation wild though. Okay? Yeah.
Everyone's kids like that. Some big bitcoin.
Well, yeah. Besides, I speak of it like every operation that you can think of in finance, in a sense, international law didn't exist before blockchains. Let me explain why I say that, okay? If you are a company in Brazil and you want to acquire a company in Bangladesh, there aren't too many Brazil, Bangladesh acquisitions. To even know what your compliance obligations are is non trivial. So what happens? Lawyers will basically take a hub country like the U.S. they'll say, okay, Brazil, U.S. that law is established. U.S. bangladesh, that law is probably established. There've been some deals there. Therefore, we will use a US Adapter to go between the countries. Countries.
Okay, Right, I didn't know that.
Or China is the other country that does business in like both those countries. So you'll use a U.S. adapter or like a Chinese adapter, typically. Okay, why? Because now you've reduced this problem of, you know, end to end of every country versus every country to like one to n. Yeah. Okay. So in a real sense, international law, I mean there's certain things that, you know, Brazil and Bangladesh will have some diplomatic relations or whatever, but for some complicated acquisition, who the heck knows, that might be the only one that year. Okay, so the law is verbal. It's hard to understand what your obligations are, especially if it's in like two different languages. Who speaks both, you know, Portuguese and you know, Bangladeshi language. Not too many. Okay, so you know Portuguese and Bengali. There's probably some, but not too many. Okay, but with the blockchain, a Brazilian and a Bangladeshi can just send Ethereum back and forth. They can interact in the same smart contract. It's all code, which is a universal language of all humanity.
So yeah, that's another reason why this is replacing like the American center of.
And the Chinese. And the Chinese, yeah. Right. So this is a decentralized center, a recentralized center. Anybody can now, I mean the size of what this does for economic growth is not yet being understood. A group of people from anywhere can incorporate a vehicle on chain with a very fixed and known rule of law. They can issue shares, all this stuff. You know, the. When I say issue shares, etc. The existing legal system doesn't like this. The USSC Etc. Is fighting, etc. Eventually. Eventually, as the current generation passes and. And whatnot. Just like with the Internet, you know the. The US government fought encryption tooth and nail and now HTTPs is mandatory for all websites. HTTPs, cio.gov. that's a mandatory thing. The thing that was forbidden is now mandatory. Okay. In the same way, eventually the efficiency benefits of just having everything on chain will overwhelm the kind of stick in the mud legacy regulators who want to maintain their power. And so what that means is every company just like it's Internet company. Every company is a crypto company. By 2030 or 2040 it'll be like super obvious then, just like the Internet thing where now people have, you know, the term retcon, like retroactive continuity. People have sort of retconned it to think the Internet thing is much older than it is. But when I say it's 10 years old, you're like, oh yeah, you're kind of right. You know, you're kind of the one.
That we know it is really.
Yeah. The Internet world that we know.
Relevant.
Yeah. It wasn't, it wasn't like during the 2000s, people were like, yeah, dot com. That's the next thing.
Yeah, you Were like, you had icq, but like, whatever, that's it.
Yeah. People could basically ignore the Internet in the 2000s. Right. So there might be a long period where you think you can ignore web3. Okay. But then eventually it'll be something where. Wait a second, there's like, it might be the crypto phone.
So from like a normal person standpoint, is it, is there any relevance to being like, oh, let me try to get ahead of this, or is it just like, yeah, it'll come when it comes, and then you almost won't even notice. You'll just be like, oh, my TVs like a this now.
So I'll come back to that point. Okay. It's very, very good point. Let me, let me close out one point, then close out that point. Okay. So the reason I mentioned, every company becomes a crypto company. Every company is on chain because it's just, it is better for international trade, for wire transfers for all that stuff is just faster, it's more programmable. It's just better if you go and send a wire transfer and then send some money and it doesn't work very good.
Yeah, insurance and stuff, right? Like, isn't title insurance a huge thing in a blockchain?
Well, so, so anything that deals with the offline world is still hard. Okay. Just like it took. I mean, Facebook and Twitter had to work before Uber and Airbnb did. Yeah, okay. They had to. It was still hard to make the online stuff work. Servers went down and so on. So all that stuff had to work. And you had to have Rails and Django, all these, you know, like back end tools before you could then start projecting the Internet down onto the land. Right. So if you're talking about the title. Yes. During the mortgage crisis, a huge part of the problem was that they sliced these things up into securities and lost track of everything. And in theory, blockchains could make that way better. In practice, the issue is you need some redeemer that's going to map that title to an offline physical property. So you're going to need crypto friendly jurisdiction. You need some something like a Wyoming, for example. Right. That's a crypto friendly jurisdiction that marries the online, you know, like feasibility with the offline jurisdiction. Okay, but I want to close at one point, then come to your point, then pop off the stack. Okay.
Yeah, no, I'm glad you were able to stay.
All right, so why the crypto? Why are the crypto company? How is that relevant to what I was saying before? Well, if every company is A crypto company. And if every non bitcoin coin is a shitcoin, then every company becomes a scam.
Right?
Yes.
You see I'm saying, right, because they're all just scams with shit. We own shitcoins.
That's right. And so this is actually similar in some ways. Like you know, I have a media.
Oh, I have this media company.
We're not online.
Yeah. We're just like a analog one. And you go, okay, so not a company.
That's right. So, so, so for example, medieval Christianity had a prohibition on usury money lending. Right. Communism had a prohibition on profit. And Bitcoin maximals have a prohibition on issuance.
What's that?
Okay, so more shares. Usury is like interest on, on a loan. Right. Communists are against profit. Just profit itself means you're scamming somebody.
And bitcoin's against any dilution of the issuance.
Exactly. Issuance of new shares of any kind.
You don't even have to be against it because in bitcoin you can't. But they're saying all these other ones, you're just giving people fake money.
Yes. It's all pre mined shit coins. It's scams.
You're like, hey, have this money you're given. He's like, you're giving everyone fake money right now.
That's right. So but let me explain why that's actually incorrect economically. In the same way that, see the Christian who's against usury, there's a good way of saying, hey, don't be in excessive debt. There's a bad way of saying, hey, let's kill all the money lenders. Because if you don't have interest, you literally cannot compare two investments against each other. It like it breaks the system. For a power user of money, the whole concept, net present value, all the stuff that you're financing. Yeah.
Someone else will just come along and do it too.
Yeah, exactly. It's basically like you need to have interest because you, you literally cannot price different investments against each other if there's.
No rate of the biggest. Yeah, that's the biggest factor.
Right. It is true that you don't want to get an excessive debt. That part is true. It is also true that you can be predatory with. It's all that is true. But it is also true that you need interest rates. Right. The same way with profit. Right. The communist takes the intuition that oh, that guy's making too much margin or whatever and turns into all profit is a scam. Okay.
Yeah, yeah. And you're like, well no, because, like, that is actually what that money's worth, because it's like, that's what it would have been gaining him other places.
So a useful way of thinking about it, I finally put some words onto this. There's seller profit. There's also buyer profit. You know what buyer profit is? How much money would it take you to build an iPhone from scratch?
Me, I could probably do it for like 15.
Yeah, exactly. Right. So. But, you know, like, point is, that's like whatever. Millions of dollars. Right. Versus infinity. Infinity, Infinity.
It's like if you have to build your own foundries and stuff, I don't.
Think I'd be sitting there like, I'm just five bucks short.
That's right. So. So that millions of dollars comes down to like 400 bucks. Right. Buyer profit is like your margin in that sense. Right. Another way of thinking about it is, you know, obviously, if you're running like a convenience store and you buy milk for $2 and you can resell it for $5, your buyer profit is like three bucks. Right. But one way of thinking about it is buyer profit is different between your build cost and your buy cost. This is because if you could build for cheaper than you could buy, you just build, right?
Yeah.
But if you can't, this is basically a measure of, like, how much. It's another thing about it. It's also your reserve price. How much would you actually pay for the thing versus how much did you pay for the thing? And so if you pay $20, you got it for 10, you made $10 in a sense of value. Right. Historically, buyer profit has not been visible because seller profit is. Well, they do accounting buyer profit, you don't do it. But whenever you've placed a limit order on a crypto exchange, if you've ever done that, you put a order down for, you know, I'll buy one bitcoin at 400 bucks. Right. You are revealing what the max price you would pay is. Do you see what I'm saying? Yes. Then if the. If the market debt moves to it, ka ching, your order is fulfilled. You have basically shown what your reserve price is. Point is, once you start thinking about, in terms of buyer profit, that both parties to the transaction are coming out ahead. It's not, oh, this guy's getting money and this guy isn't. Right. So that's the counter argument for the. The communist who says that profit is, you know, malevolent. Okay. Then for the maximalist, they say issuance is bad. Okay. Why is issuance bad? And the thing Is each of these sort of quasi religious movements pathologizes a different aspect of capitalism because they take the bad parts which do exist and they argue that the totality is the bad parts, which is not true. Right. So the maximalist, why is it, why are they pathologized? Issuance. They say anybody who's issuing a new coin must be a scammer because look at all these scams. Therefore all issuance is scams. All issuance is pre mined. You know, coins all has real religious.
Vibes to it too, of like we are the religion. All these other ones, they're fake evens.
In fact, both wokeness and maximalism have taken pieces of Christianity in the, you know, you've got this western civilization that submits the ruins of Christianity and wokeness has taken some pieces like the doctrine of original sin. I mean, right? And you know, you're going to a warm hell if you, you know, climate change, if you don't like give up all your stuff and humble yourself and so on. Right. And maximalism has taken other pieces. So they love the passage, for example, about like Jesus throwing the money changers out of the temple. They love that one. Right?
Those are my people.
Okay, fine. So say got thrown out of the temple.
Oh yeah, so.
Oh yeah, yeah.
So they post this, you know, or they'll talk about, you know, the Genesis block obviously, but you know how bitcoin's founding was like the immaculate conception. They'll take that concept of.
Right.
So bits and pieces of like, you know, Christian theology have made their way into these nominally secular ideologies. Right. And. Oh, there's some beeping.
I think it's your phone. Oh, this is just your phone.
Is that my.
Yeah, I don't know. These things interact with phones. Weird. It's super strange. It's either your phone or your burner.
All right, put this here. So with issuance, just talk about that for a second. Come, come to your other point. With issuance, it seems intuitive. Okay, well, aren't these shit coins all scams? Whatever. Right? The thing is, but the one thing they're really big on that they don't like is the concept of pre mined coins. Right? Meaning 40% of coins are set up in this new coin for the founders and 60% go to the community. They hate this. Why? Because Satoshi, you know, mined and anybody. It could have been an open, you know, kind of tournament. Anybody could be part of this. Right? Well, first, just on the point of, you know, bitcoin was totally open. I think it was, however something like 95% of Indians and 99% of Africans were not actually online in the late 2000s, early 2010s. They couldn't feasibly have mined bitcoin early on. So as a fair launch, it was probably as fair as Satoshi could have made it. But it wasn't actually universally fair in some sense. Some people had Internet access, some did not. But the second point on the pre mining, whenever you set up a company, you're pre mining equity, okay? And why do you give out equity as well as cash to your employees? Why don't you just give out dollars and the go ahead?
Because you want them invested?
Well, yes, but deeply. It's because, you know, you might say, well, why don't you just loyal to the U.S. economy, right? You know, you work hard, you'll increase the dollars. This is the argument of the bitcoin maximum. So why don't you just hold bitcoin, work hard, increase the price of bitcoin, Right? The issue is that you're saying the.
Company will go up more, more than the dollar.
Well, yes, but we want them to believe that. But why? Here's why. The reason is your efforts can directly increase the value of equity. Why? Because in theory, the price of, you know, a share is related, or the value of the company is related to the net present value of all future cash flows. If the company is making money in years 3, 5, 6, 7, you know, like, you can discount that to the present day. And that's the value of a share. It's $50 under this model, okay? If you work hard, you can bring in a deal for $5 million that boosts the value of those projected cash flows. Then you take that to a venture capitalist, they'll buy your shares, okay? So therefore your individual efforts connect to increasing the value of your shares, okay? Whereas you cannot really increase the value of the dollar this way. That's like a drop in the ocean, you know, you can't control Powell monetary policy effort at such a large scale of hundreds of millions of people worldwide does not connect with reward. So we come back to the communist thing, right? Remember in communist China when those farmers couldn't get a cut of their own grain because they were expected to do everything for the collective. Here you can go so far to the libertarian right that you are again against the concept of people getting returns on their own effort, right?
Because it's all for the common coin.
Is for the common coin. Exactly right. So. And you see all the pieces there.
Essentially being a maximalist of anything is generally.
That's why maximalist equals fundamentalist equals supremacist. Exactly right. You know, so that's why I think a better term in my view is optimalist. Right. Not just in the sense of optimistic, but optimalist in the sense of also like the mathematical concept of optimizing the objective function. What is the optimal? The optimal is not necessarily the maximal. For example, imagine a group of people who call themselves westests, okay? Because they like the idea of California. They keep going west, then they end up in California. They actually make it there, and now there's a fission within the group. Why? Because some of them want to keep going west into the Pacific Ocean. What are you, an east is cuck? You know?
Right, Very much. Imagine that conversation.
You can imagine, like literally that conversation happens to on Twitter. You should make that into a clip if you want.
Okay.
Like that conversation happens on Twitter a thousand times a day. And what it is, the reason is that ideologies are being used to steer. And if they're being used to steer, there's no stopping criteria. Right. So let me give you kind of three versions, right? The first is ideologies, a steering that just are extremist and too much is never enough. There's literally no stopping point. You can never be maximalist enough. You can never be fundamentalist enough. You can just never be woken up.
Probably even more so. It's like there'll always be someone that could do it more than you.
Yes. And there's an endless red queen competition of this about, like, who is the purest of them all. And you just keep leapfrogging for higher and higher status using these words until you just get to like the lala zone. But nobody can back off from it because they're all just like religious fanaticism just pushing people off the ledge. Right? So that is kind of, you know, no steering. Okay. Then the second version, which is the hypocritical version, is like the New York Times company version. Talk left, act. Right, okay, so they're for the Iraq War before they're against it.
Yeah, exactly.
They are, you know, for the, you know, the Chaz Zone, you know, in Seattle, before they're against it.
Yeah, yeah, yeah.
Okay. And so they steer like this and they kind of make money both ways on this, right? Yeah, but, yeah, but you're to blame, right? Like you're, you know, you're the bad guy, right? No matter what, you're to blame. Right? So.
Well, they sort of almost like agree with you after. And they were like, yeah, but like you shouldn't, like you've at least tried the other one first.
That's, that's right, that's right. So. So for many people the safe strategy is to just stick with the party line and then reverse on it and then reverse. Right. This is the same actually as you know, the Trump supporters who were, oh, you know, they were prepping for the coronavirus and then suddenly the coronavirus wasn't anything and then they were for the vaccine and they were against the vaccine. Right. They also like flipped like four times. You know, this is basically like, it's tribal as opposed to ideological. So this is. But, but they're using ideological words to talk about it. Really what it is, is I do not trust the other tribe. That's fundamentally what it is. It's, it's universalist language for particular ascends. Okay, so this is the like. So the first version is being so ideological that you go off a cliff. The second is just flipping your messaging to steer like this without ever acknowledging it to yourself or to others.
Yeah, because I guess a lot of it is, you see just like, you know, if, if you were running a big company, you're just like, yeah, people are gonna, you gotta say stuff so they get off your back and it's like, it's almost irrelevant, you know.
Yeah, you basically like once you think about a steering, it's like crowd control, like okay, we need to go left for a while. Let's put out some tell with these.
Whatever these peasants will think. And you go, what about. You just said the other thing. You go. They're stupid.
Yeah, concrete example. Concrete, yeah, no, exactly. Because if they have enough, if they, if they have distribution, then you can't contradict. Right. A great example is in 2020, America was supposedly so systemically racist that George Washington, everything had to be torn down, rebuilt, et cetera. Now in 2022, what's the message? America is the global champion of democracy and all of these non white countries need to listen.
I never even thought of that one. That's a pretty good point.
Ridiculous. Right? Like these two things, this is domestic propaganda meant to win a domestic conflict. Right.
We need to spread them thing. Well, maybe I guess their argument is that like we enlightened now but ah.
So the enlightened, the tribe that wins is also the tri. So basically. But obviously of course the Internet has collapses context and this propaganda isn't even that old. Right. So.
No, you know, so basically four years.
Ago, if you're sitting in India, but.
You started doing all this like international democracy, spending way before that. It's like, yeah, we started. Started a little early.
We get a dead start if the president, United States is saying, America is so systemically racist, blah, blah. How could like an Indian or Nigerian or something possibly say, okay, you should be the leader of the free world. You said you're a racist.
We're a white supremacist country. All right, let's. Now let's do some stuff in India. Yeah, I don't know. Aren't we white supremacists? Like, not, you know, it is what it is.
It is what it is. Right? So think about this. Right? So this is, this is what I mean by, like, steering. Right? And it was actually, this is what Orwell also wrote about when he was like, eurasia is now at war with east Asia. You know, basically the, these giant, like, you know, the, the Soviets and the Nazis, they would put out one message one day, and then they put the next message the next day, just as it turned convenient. For example, up until 1939, the Nazis and the communists were, oh, they're, you know, they're at odds with each other, et cetera. Then Molotov, Ribbentrop, the Nazis and Soviets signed a pact, you know, they started world war war ii allied with each other. Who? Nazis and Soviets.
I didn't know that.
Okay. Yeah, they invaded Poland together. Okay. And so 1939, 1941, all these communists around the world got the order to like, u turn. Now they're pro Nazi. Oh, and then 1940, they u turn again. Now they're anti Nazi. Right. And you know, this kind, these kinds.
He's been pro the whole time.
Yeah. Right. So the point is these sort of like head snapping reversals are, you know, basically. Basically something that you're, that you're seeing during these, like, ideological times. Right. And so why did I bring this up? So, so the first version is just the westest failure mode where you just go and fall into the ocean. Okay. The second mode is sort of the hypocritical tribalism where, you know, it's, it's both systemically racist and the global champion of democracy as. As suits the moment or whatever. Right.
Needs to be.
As it needs to be. Right. And we. It's less effective because now those are not separate channels. Right. It's not like you can just message domestically one thing and globally a different thing. Those are all merged into one channel. Okay. So it's context collapse. Right. So there's a problem for the messaging apparatus on this. And the third model is what I call optimalism here. You admit that you have a group, that you have an interest, that you're trying to optimize that interest. You are acting in that, that self and other interests, but you're not like in this insane Conan the Barbarian way. Right. One way of thinking about it, people talk about how communists don't understand self interest. A lot of nationalists don't understand other interest. Okay. Yeah.
What would be an example?
Exactly. So obvious example is, you know, Hitler, who doesn't even thinks the Slavs are intervention. Okay. So the guys next door, you, like, kill, you know, lots of those people. But, but lots of nationalists don't assign any weight to the, the interests of people in other countries. Okay.
They just care about their own country.
That's right. And I, I understand where that's coming from. The problem is that they affect you. The, the way to win is win, win. Like, that's the way.
You don't want to play this. You don't want to make it a zero sum game.
Yeah, exactly.
You want to make it.
If you go out, like, you know, like, during, during the Trump administration. Like.
But I think, I guess some, I think that if I was to, like, understand some of those people's points, they're just like, yeah, like, it's more important to us to have, like, our culture to some degree maintained. Yes. And these, like, economic battles, you're like, they're gonna lose out. They're like, we don't care.
I think that would be the argument. I, I do understand. I do understand where it's coming from. However, I think center right beats like, nationalist. I mean, it's complicated. Okay. But I think that if you can figure out how to get other people around the world. World to also win, you can build a larger coalition. And if you. Because what you can't have is something where you're like America, you know, like, and, and then want people from around the world to support you, but you kind of need that in order to maintain that position in the world. Do you know what I'm saying? Yeah, you kind of need to.
Or you need like a big war where you're the hero.
Yeah, I, I totally understand why somebody who is attacked, you know, for their culture, and so then they rise up like this, and they're like, yeah, you, you know, my, my, my culture's great. You know, I totally get where that's coming from. It is, however, a trap, because rather than, I mean, this is sort of like the US versus China kind of thing. Like, the US has become this thing that doesn't actually the only rule of the rules based order is the US Is number one. China sees this and is like, okay, well we're just also going to act completely in our own interests as we see it. And they're completely unpersuasive on the world stage as a consequence. Right. But the third version is actually say a different tack which is, yeah, you're not having the rules based order, but we want one. We want one to protect both large and small countries, both people in there. And now of course that's much easier said than done. How do you have like a muscular classical liberalism and that's where crypto comes in. Yeah.
And also all the stuff that they hate is like mostly coming from within anyway.
Yeah, yeah, exactly. That's right. And so I think like this is something where, you know, is that the.
Like meme, like crypto solves the.
This.
Like it's.
I mean it's kind of, kind of the meme Bitcoin sells. Right. But, but the thing is that.
But decentralization, like even if you are does like by. It just actually does solve most problems.
That's right. That's right. It does. It does. At least today it solves a lot of problems.
But it's like how do you do it ever is like you're just. It's like easier said than done is also.
Let me give a concrete example just to be so Ben Franklin, he's an American patriot. Okay. It's hard to be more patriotic than Ben Franklin, but he built bridges with the French to beat the UK Okay. So he was an internationalist and a nationalist. He was able to see outside of his own self interest to ally with the French, you know, against the communist.
You can probably think about that in your personal life the same way.
That's right. So like the smart nationalist is not like a chest thump, you know, America F. Yeah. But it's somebody who thinks about diplomacy and alliances and coalitions and so on so that they advance their self interest and other interest, you know. Yeah.
As opposed to someone who's like, you either have to only care about yourself or you have to be like the service of others. And you're like, well, both, you know, exactly.
Kind of.
I mean it's like super. It's like super obvious if I say it this way, but any CEO does that as well. They have to care about some degree their own company's interest. But if you're doing a deal, the whole point is empathy and understanding where the other guy's point of View is. And maybe you can give on X and Y and Z and you come out to a win, win. But win, win is so obvious, yet it is like the V3 in the thing I was talking about, right? How can you get to win, win? It's not always obvious how to do it. The goal is obvious. The way to do it is not. Okay. One other thing I'll just say is I am a fan of. When you have involuntary centralization, then we need decentralization, and I'm a fan of that. But I think that the most. The most important, least popular word in the world now is recentralization. Because just like, you know, when people exit a burning building, okay, that's like decentralization. Get the F out. But then they regroup at a site.
Is that just, like, how every idea is like a packaging or unpackaging?
Yeah, it is, exactly. It's like, so, you know, you have. I mean, it's unbundling and bundling, right? So you have, you know, like, newspapers, and they're broken up into articles and rebundled into Twitter feeds, you know, or you have CDs, and they're broken up into MP3s, Rebellions, Spotify playlist. There's like, dozens of examples. I got a tweet thread on this. And so the goal is not totally. It's neither centralized tyranny nor decentralized anarchy, but opting out of centralized tyranny. There's a period of decentralization, then you re opt in. It's a rebirth of society. Okay? You have voluntary recentralization. You have all of these leaders around the world, these various network states. And, you know, this is the vegan one, and this is the CrossFit one. And this one. Oh, it's like Turkish immersion. You can learn Turkish there or whatever. Oh, and this one, everybody dresses like they're from the 1950s. Whatever. Just like.
Yeah.
You know, different.
Every permutation.
Every permutation where now you can basically pick. And you get your digital passport effectively and just go and live there. Right? That's fine. Fat slob society.
There you go. I was almost gonna leave it.
All right. So you asked one other thing, which is like, you know, how do you, like, you know, get into this future or what have you, if you. If you like it and. Yeah.
Or like, if you have your, like, young or whatever, 25, and you're just like, yo, my. Like, there's. If this new world's, like, happening, what's the ways that it gets involved and what does it look like?
So I would say. So let's say, let's branch on. Can you do math or not? Okay. If you can do math, learn computer science and learn statistics. That's like the.
I feel like I can do math. I'm not going to learn computer science.
Okay, fine, fine. If you.
I'm just not just me, I would.
Sure. So. So if you can do math, then learn CS and learn stats. Why? That's like the CS Computer science. Okay, Learn. Learn computer science.
Not going well so far. I know that.
I. I know so far, not good. Now I got the acronym now.
Okay, Got the acronym. Okay, so learn computer science, learn stats. Because that's like the physics of the digital world, right? Stats, okay. Why like physics? Physics is the physics of the physical world and, you know, like fluid mechanics and all stuff that was also, that was all incredibly useful in the 1800s.
That's stressful to most people, though. You're like, yo, so there's this new world, what I do. They're like, you'll get really good at math and stats and physics. Everyone's like, I'm fucked.
Yeah, yeah, well, that's what I was saying, first branch. First branch. Is that right? So the thing is now increasingly, for example, what percentage of the time do you spend looking at a screen?
Too much.
Too, way too much.
I don't know that. I don't do my. Like, I don't put the timer on it.
It's, you know, six hours.
I mean, I run a fucking digital media.
That's right. That's right. So you. But let's say probably at close to 50% of your waking hours are spent looking at a screen of some kind. If you include your phone, you include your, like, watch. And so, you know, let's say at least several hours a day.
Yeah, I don't, I don't factor in my computer, computer obviously, which is. I was just talking about my phone.
Okay, okay, fine, fine. You add up, you have your screen time. It's several hours a day, right? And so everything that's happening on that screen is governed by computer science, which is the algorithms and then the data that's in databases, you analyze it with stats. Okay? So that allows you, whether you're going into Walmart or Johnson and Johnson, you're, you know, you're working with an apartment complex or a YouTube channel. Every single organization of any kind for the foreseeable future will have need of people who are good at CS and stats. Okay. Everywhere in the world, right? So that's like, if you're good at math, get good at those fundamentals. Okay. Now physics are also, that's also important to know, etc. But CS and stats will be immediately monetizable everywhere. That just pays the bills. Good. Right. Now if you can't do math, find somebody who can't. No, I'm like half joking, but it's.
Basically like find them in your basement.
Lock them in, you know, feed them.
What do I do with my gender or her.
Them. Yes, exactly. Right. So if you can't do math, you can find like a.
So you're saying girls are fucked.
You can find it. You can find a co founder, you can find a friend or something, work with them. Right. Or if you're good visually or verbally, create content. Right. Basically many, many content, like moving in.
The future is like.
Yeah, I think it's pretty big. Yeah, exactly.
Everyone's a content guy.
Well, yeah, yeah. The reason being because every like dentist.
Is like his tick tock channel now. Like it really is.
Yeah, it is. Because getting there, the reason is like founding influencer is going to be on par with founding engineer. Right. Or founding creator. On part of founding.
It's part of the whole package. I mean the Logan Paul's of the world.
Yeah, Logan Paul is because you can if you want to. Just think about it from a, like a, like a pure. I always forget if it's left brain. Right brain. Left brain is systematizing. Right. Correct. And right brain is emotional.
More likely to be right than me probably. I thought left was artistic.
Okay, fine. So let's just say systematizing brain if you want to put that lens on it. The founding creator is the customer acquisition for whatever project you're doing. Okay. Every project has some need for quote, marketing. But the most organic form of marketing is you built a community and the product grows out of that community's needs as opposed to it being, you know, budded from on high.
I need a community for my music video app.
Yeah, exactly. There you go. So, so like you guys have a community and probably if you did enough like focus grouping or whatever in that you would find that there were certain things that everybody said, hey, we would buy together.
Auto blows.
I, I, I, I.
No, you're right.
You have a very sophisticated clientele.
No, I just did. I did.
Yeah. And, and so you could probably angel invest in that you could have an angel investor provide. So if there's somebody, either you have the capital yourself or there's a lot of angel investors out there. As a content producer, you figure out.
Talk to some of your friends about doing like, you know, a movie and things like that. But that's still in the. Still selling content again to the people. Like content as opposed to what you're talking about.
Exactly. So the thing is, I think the con, I mean one way of thinking about it is all content becomes content marketing. Okay. Or community building. And they build a community because the thing is, look, selling a YouTube video or substack, that's actually relatively cheap relative to solving a genuine problem in somebody's life. Like the amount that they would pay for a genuine problem solve versus this. Right. So in order to think about it, you know, the, the Social Network movie. Okay, that was, it was, you know, you've probably seen it like in 2010, right? It did a few hundred million dollars in box office. Pretty solid.
Yeah.
If however, the movie had been free and there being a link at the end to invest in all the founders who came out of that that have made way more money, like by orders of magnitude more money. Okay.
I always have ideas for apps. Maybe I need an app.
So if you guys. Well, if you guys make what I'd call investable content. Right. And that might seem.
No, but I know it's the same as why it's like, you know, if you're like a get rich youtuber, like your ads are worth a ton more because there's a, like, you know exactly what those people are all looking to buy stuff to and they're all trying.
To get, they're all trying to make money.
So there's also, you know, like if, if you're listening to Tim Ferriss, you're the type of guy that you know.
Exactly what possible income or whatever.
Yeah. But also you're typ gonna buy something that'll help get you fit. You're gonna buy something, whatever. Everyone has a version of that. But certain markets, like, you know, if you're a girl that your audience is like, you know, 12 years old, like you might, I don't know, I guess if they're rich. But you know, there's certain demos are worth way more than others.
Exactly. Every community has some like level of stuff they're getting that's not there.
Girls are worth more actually.
Well, yeah, more household spending I think is by women, you know. Right. But so you have. So, so that's, that's the second approach. Right. You're a content producer, some kind. You don't have to be an elite YouTuber or something like, like you guys and you're.
And then you essentially interface with like blue blockchain people, not just blockchain, just.
Tech people in general. Right. You've got, you've got your technical side, you've got your kind of humanity side. You've got two in a box. Your engineering, your creator. And that happens at like the most senior levels of any organization, but also all kinds of junior levels down even to like an individual product or an individual feature. You'll have somebody who's making like the video or the story or whatever for it and the person who's coding it. Right.
I've done a lot of that before.
You're a fair amount of that. Right. So that's, that's like those two and then. And as an investor. Right. Which is kind of a different thing. So these are active. This is where you're putting in labor. Right. If you're on the math side or if you're on the content side. So that's. If you're putting in your labor, if you're putting in.
That's the future math or content kind of.
Yeah. I mean, like, of course there's. There's more to it, but that's roughly how people cut it. Right.
Some guys not gender studies degrees.
See, told you when everyone was yelling at me last episode, because I said that I don't care, that I can't fix anything.
Content is valuable. It's very valuable. Right? So the, you know, code scripts, machines, media scripts, minds, you know, and so you need to kind of be able to program both. And that's why you need both. And. Ooh, that's a good one. Right? And so the, the third is capital. So now, as opposed to labor, where you're putting in your time capital, you're putting your money, Everything is now opening up in terms of investing. That is a big thing about Web3 is you really can. You will be able to invest in basically anything. Okay. What I mean by that is if you have some bet that. I mean, one way of thinking about it, and this is not super obvious, but many things, and I probably need.
To go in a bit.
Many things are a form of arbitrage. Okay? So for even like a, a little deli or, or a convenience store, let's say convenience store. That's a form of arbitrage. Why? Because they're buying water bottles wholesale and they're selling it retail. Okay. They have some thesis on how many people are. Come into their store and what price they'll pay. They'll pay five bucks or whatever and they'll buy them for two bucks. I don't know the Exact price. Let's just say something like that, right? So arbitraging that this thing wholesale is worth more retail. And they're making money on the difference of that. Right? Now you take that convenience store and you turn it, give them a tick tock. Well, wait, wait.
There's so many bodegas in New York, they're all over TikTok.
Okay, so you're almost there. Okay, so, but first. But let's go step two. Step two is you take that convenience store and you virtualize it. Now it's on Uber Eats. It's a digital storefront. Okay. Maybe it doesn't even exist, like in the sense of, like a normal sense. Like you think that there's a physical storefront that matches. Now more and more things are just built for Uber Eats or built for Grab, they're so called, you know, cloud kitchens, back end type things, ghost kitchens and all that stuff. Yeah. And now they can just change the decor with a new graphic designer. That content creator makes different art. And this is the liquid death branded water and this is the other, you know, so now you can try different aesthetics, different copywriting, oh, you know, anything. I mean, water is by the way, like almost a perfect example of just how branding can differentiate. You've got evn, you've got all these different things, right? Okay, so you have these different storefronts. You can actually iterate on your different storefronts. You can also iterate on like your store's positioning. You can't move your physical convenience store that easily. Right? Though store placement is a huge consideration for Starbucks and others. Your digital store, you can, can be, you know, you can place your UberEats ads in all these different locations. You can figure out, oh, people, you know where they really want water at Jones beach, okay? There they really want, I want my convenience store on Jones Beach. I want to advertise to these people here, but not other places. Boom, cold water right now. Okay? So now you virtualize that store and now you've got a more focused arbitrage like proposition, right? More of it is being digitized. You're literally buying X and selling Y with this like virtual storefront there. Now your TikTok guy comes in to drive people to that storefront. Okay. And when you start thinking about it this way, many businesses are in a sense a form of arbitrage. They're buying wholesale, selling retail. Almost every store that you ever retail.
Is business model, period.
Retail business model. That's like an enormous swath of stores.
Are like this, I guess, unless you make it.
Yes. And so an enormous swath of stores are becoming digital storefronts. Right.
And.
And so what happens is all of these things, not today, not next year, not in three years, but probably in 10 or 20 years, all those things become like Web3Bettable. Because you can now have some thesis on, okay, people are going to buy a lot more water today. And so you can, you know, buy into that.
Yeah.
Like in terms of a token.
In terms of a token or in terms of some kind of derivative or.
You should be able to bet.
Well, they have like all the, the betting. We were talking about some betting market for. What were we talking about?
No, we were saying there needs to be a betting market for like, like that's attached to, you know, like Andrew Tate became the biggest person in the world. Then you don't hear about him again. Not that you don't hear about him again, but like, it's just no one.
Is that popular for that quick futures market on, on. On page views.
I guess it would be like impressions of the name. But like, you know, let's say we said like, even like what would be like a. I don't know what, Ukraine or whatever. Like just anything where you go, just.
The number of mentions of the word.
It's like basically the popularity of someone. Like, we like the same way you can bet on the creator. I mean, I just always said like, you know, like when you think of like an artist, I be. I know that guy's gonna be bigger. I said, I. You. I think that about the first time I heard it, I was just like, this guy I'm going to hear more from because you could just tell, like Jordan Peterson. I would heard that. I remember, I always say rapper 69. I very early on I go, that guy's going to be the biggest rapper. I feel like I've been right so many times about things and now you.
Can bet on that.
Well, how.
Yeah, right.
Yeah.
Someone has to just take the other side of it, right?
Well, personal tokens are actually a primary sale, so you wouldn't have to. This is a great question. So primary versus secondary sales. Do you know the distinction?
Well, primary. No.
No. Okay, so a primary sale where you issue it. Your question is a very good one. So I'll give it, you know. Yeah, so. Yeah, exactly. That's right. Primary sale is where you are issuing it or company is issuing it. So venture capitalists, when it's a primary sale of stock, is buying the stock directly from the company and putting in $20 million. Right. That is, you know, primary sales in general are considered good because that money is going in and then that company is spending it on products which will increase the value of the stock for all parties by the mechanisms we discussed earlier where you're increasing the NPV of the stock. Right. The secondary sale is when that venture capitalist then goes and sells the stock to somebody else that is now secondary and money is changing hands between the two, two parties, but it's not going to the company for productive endeavors. Okay, okay. So the similar concept can be extended to the issuance of a so called personal token, which is just like the company sort of securitizes itself and sells some shares to fund current activities in the belief that it's going to become more wealth sharing in the future. But basically, yes, there are personal token. I mean, it's hard to build a startup or whatever. You know, there are various personal token things. One of them will eventually work and you'll be able to tokenize yourself. And so you're a kid in, you know, the middle of, you know, Moldova or Mexico, and now you can issue a token and you can get $30,000 of capital from people around the world speculating that you're going to be maybe the Mexican Jeff Bezos or maybe not that big, but maybe it'll be like fairly successful. And now you can take that money and you can actually go and maybe get podcasting equipment, equipment or whatever it is. Right.
And that's the other John, People like these days, it's like, what do you even do with capital? Like, you know what I mean?
Yeah, well, so you might buy some equipment, you might, they might buy a computer, do some AI stuff, whatever it is. Right?
Yeah.
And then, then they, they now are, they've increased their productive capacity and they sold, you know, some amount of this and now the remaining tokens are worth something more. Right. So that's like a primary sale, as you're saying.
And then people would just then start trading them to speculate on that person.
And you could have various lockups and stuff like that. He might not want anybody to hold their personal token. You might also make it. So the personal token, the best probably model for that is you can redeem it for like one hour of the person's time. Right. So you're selling like 100 hours of your time.
So there is an actual utility.
There's a utility to it. And then you might put limits on that. It's like, okay, that's in like Gary Vee. You can feel like, yeah, you can't make them, like, dance naked or something like that. But you might make them be like.
Like, I won't be your butler for a week.
All right. Different people will have different value propositions, Right.
Some people will be like, my time.
Yes.
So what do you want me to do? Just sit there and silence.
There'll be various restrictions on transfer and usage, but this way people could just sell a few hundred. I mean, it's literally like consulting. It's micro consulting. If consulting is okay. This is just like that, right?
Yeah.
So sort of like speculative consulting. And if you had bought an hour of Bezos time when he was 18 and now you.
Yes.
Now you could cash that in, that would be worth a lot. And Bezos might just buy you out rather than waste his time.
Right. Yeah.
Right. So that's the kind of thing which I think is an interesting. Now there's various issues around this, which is like, what if the guy just runs away with the cash, etc. And one way around that is so called.
Or like, just says, I don't.
Yeah, like, don just doesn't redeem it. Yeah, just like, you can't get a hold of him.
Well, I guess at that point the exchange would have to be culpable.
And then there's like, well, so this is. This is to be worked out. But probably the best bet would be they have a dot ETH name, like, you know, Joe Smith eth. And this personal token is attached to that, and so is other reputation. They're like, posting on social media with this and so. And so forth. So if they dodge, they have to sort of just abandon that entire name. And you're essentially betting that they've built up some reputation under this name so that, you know, now you have some collateral. Effectively, they don't have to give up their quote state name necessarily, but they have collateral in the sense of this entire account and everything that that's linked to it. People will see that this person didn't pay back that account. And.
And that's like the username of usernames, essentially.
Yeah, yeah.
Your dot ETH is. It's like the ENS thing, right?
It's like the ENS thing. That's right. That's something. So, you know, very specific recommendation for people. If you haven't got your ETH name, you should probably.
I bought mine last year. I spent a thousand dollars on it. I still don't know if it's a good, good use of money.
You'll. You'll probably be happy.
I'm gonna write down to get mine. But we should also pay a pin. I'm starting to feel bad here.
Like.
Like, already an hour late here, dude. I. That is very nice of you to stay an extra hour. And it was like, super cool hanging out, but cool. Everyone. Everyone can go to the Network State.
Like the network state.comstate.com free online.
And the cool thing was you have like a one sentence of one paragraph and then a one. Like.
And it's updated constantly.
Yeah, it's updated. That's right. So I'm going to try and do.
It's like a new version of a book.
It's a living book.
It's a living book. That's right. It's actually. You know what's funny is it's actually pretty hard to update on Kindle, so the website is actually the best version of it. Yeah, Kindle, like Kindle itself is actually.
You update. It takes a. Like what?
It's a. You process, it takes a long time, etc. So the V2 of the book will be, you know, hopefully sometime next year. There'll be a lot of stuff coming up, but I'm just intermediately updating it on root. So go check it out. Let me know.
Yeah. And then on Twitter.
On Twitter. I'm at Bala GS on Twitter. And it's also hentwork State on Twitter. Oh, yeah.
So you're the man.
All right.
Thank you.
Thank you. Thanks, guys.
More from Balaji
34 - Network State Conference 2025 - Fireside with Vitalik and Balaji on Zuzalu and d/acc
33 - Network State Conference 2025 - Fireside with Amjad Masad of Replit and Balaji
06 - Network State Conference 2024 - Fireside with Naval Ravikant and Balaji Srinivasan