Episode
#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
4:21:08
Published: Wed May 11 2022
Description
Saifedean Ammous is an Austrian economist and author of The Bitcoin Standard and The Fiat Standard. Please support this podcast by checking out our sponsors: - GiveWell: https://www.givewell.org/ and use code LEX - Scale: https://scale.com/lex - Uncruise: https://uncruise.com/pages/lex - BiOptimizers: http://www.magbreakthrough.com/lex to get 10% off - Athletic Greens: https://athleticgreens.com/lex and use code LEX to get 1 month of fish oil EPISODE LINKS: Saifedean's Twitter: https://twitter.com/saifedean Saifedean's Website: https://saifedean.com The Bitcoin Standard podcast: https://saifedean.com/podcast Books & resources mentioned: The Fiat Standard (book): https://amzn.to/3FmNfsy The Bitcoin Standard (book): https://amzn.to/3LRrcwA The Blocksize War (book): https://amzn.to/3LORQ9o The Theory of Money and Credit (book): https://amzn.to/3ykreZT Human Action (book): https://amzn.to/3w9LzP4 PODCAST INFO: Podcast website: https://lexfridman.com/podcast Apple Podcasts: https://apple.co/2lwqZIr Spotify: https://spoti.fi/2nEwCF8 RSS: https://lexfridman.com/feed/podcast/ YouTube Full Episodes: https://youtube.com/lexfridman YouTube Clips: https://youtube.com/lexclips SUPPORT & CONNECT: - Check out the sponsors above, it's the best way to support this podcast - Support on Patreon: https://www.patreon.com/lexfridman - Twitter: https://twitter.com/lexfridman - Instagram: https://www.instagram.com/lexfridman - LinkedIn: https://www.linkedin.com/in/lexfridman - Facebook: https://www.facebook.com/lexfridman - Medium: https://medium.com/@lexfridman OUTLINE: Here's the timestamps for the episode. On some podcast players you should be able to click the timestamp to jump to that time. (00:00) - Introduction (07:53) - Money (20:58) - Gold standard (34:09) - Collective hallucination (39:59) - Austrian vs Keynesian economics (1:12:20) - Free market (1:28:49) - Monarchy (1:34:23) - Fiat money (2:21:13) - SWIFT system (2:34:03) - Bitcoin (2:40:20) - Satoshi Nakamoto (2:48:04) - Criticisms of Bitcoin (3:03:16) - Football/soccer (3:06:58) - Criticisms of Bitcoin continued (3:17:17) - Bitcoin Maximalism (3:29:40) - Proof of stake (3:46:46) - Central bank digital currency (3:57:59) - Michael Malice (4:00:12) - Advice for young people (4:06:21) - Palestine (4:18:00) - Mortality
Chapters
The podcast talks about Safetine's opinions on human nature and society civilization and guest Paul Krugman, a neo-Lackensian economist.
00:00 - 03:11 (03:11)
Summary
The podcast talks about Safetine's opinions on human nature and society civilization and guest Paul Krugman, a neo-Lackensian economist. The host mentions some sponsors but purely for the intent of exploring Safetine's ideas.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
This podcast discusses how data plays a crucial role in machine learning and the nature of money as a good that is not bought for immediate consumption.
03:11 - 09:54 (06:42)
Summary
This podcast discusses how data plays a crucial role in machine learning and the nature of money as a good that is not bought for immediate consumption.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
Money is a mechanism for global exchange that enables individuals to specialize, exchange with ease and plan for the future by stocking away value, which was not possible in small societies due to limitations in trading.
09:54 - 21:15 (11:21)
Summary
Money is a mechanism for global exchange that enables individuals to specialize, exchange with ease and plan for the future by stocking away value, which was not possible in small societies due to limitations in trading. History reflects consistent developments in the kinds and ability of money to sustain its value for future use through advancements in difficulty in production.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The gold standard was adopted as a means of creating a uniform currency using a universally recognized commodity, gold.
21:15 - 26:13 (04:58)
Summary
The gold standard was adopted as a means of creating a uniform currency using a universally recognized commodity, gold. While silver and gold were used as money in the 19th century, gold became the primary standard due to its divisibility.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
Using copper as money wouldn't work because copper production and consumption is a continuous process and it is not scarce.
26:14 - 33:38 (07:24)
Summary
Using copper as money wouldn't work because copper production and consumption is a continuous process and it is not scarce. On the other hand, gold, although not a perfect standard, is more concentrated and valuable, giving those in charge of it enormous power.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The value of a currency lies on its supply and demand, and the most successful currencies are those with the least expensive inflationary central banks.
33:38 - 46:28 (12:49)
Summary
The value of a currency lies on its supply and demand, and the most successful currencies are those with the least expensive inflationary central banks. However, in the current economic reality, fiat money prevails as predominantly credit.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
In this podcast episode, the flaws of the current monetary system are discussed, including how the government can print money whenever it wants and how this causes inflation and recession, leading to artificial scarcity.
46:28 - 56:24 (09:55)
Summary
In this podcast episode, the flaws of the current monetary system are discussed, including how the government can print money whenever it wants and how this causes inflation and recession, leading to artificial scarcity. The speaker argues that at some point, this monopoly will break, causing a devaluation of traditional currency and increased interest in alternative currencies such as Bitcoin.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
This podcast discusses the problems caused by going off the gold standard and how justifications were made to cover up those issues.
56:24 - 1:01:46 (05:21)
Summary
This podcast discusses the problems caused by going off the gold standard and how justifications were made to cover up those issues. The value of goods produced is compared to market value and explained how it relates to the gold standard.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
A person with a scientific or engineering background may find red flags in economic models.
1:01:46 - 1:06:50 (05:04)
Summary
A person with a scientific or engineering background may find red flags in economic models. One example of high inflation and high unemployment can refute the idea of a model, such as the Keynesian model.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The use of aggregates in economics to establish scientific relationships between different economic factors is the main reason why economics is considered pseudoscientific, according to the Austrian school of economics.
1:06:50 - 1:13:15 (06:24)
Summary
The use of aggregates in economics to establish scientific relationships between different economic factors is the main reason why economics is considered pseudoscientific, according to the Austrian school of economics. They argue that the market economy can only be understood by examining individual human action, rather than relying on aggregates like production and unemployment rates.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The argument that certain industries require government monopolies due to natural monopolies or economies of scale is flawed because it takes away the free market process and prevents the exploration of alternative solutions.
1:13:15 - 1:21:56 (08:40)
Summary
The argument that certain industries require government monopolies due to natural monopolies or economies of scale is flawed because it takes away the free market process and prevents the exploration of alternative solutions.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
This podcast episode explores the libertarian perspective that views government and military as a form of gun to the head, where the use of force is employed to take money and purchase more weapons to hold over people's heads.
1:21:56 - 1:29:10 (07:14)
Summary
This podcast episode explores the libertarian perspective that views government and military as a form of gun to the head, where the use of force is employed to take money and purchase more weapons to hold over people's heads. The episode also discusses the idea of manipulation and propaganda used by those in authority, even with good intentions at times.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The key to being a good king is to leave people alone and only use your power to punish those who aggress against others, not to enrich yourself or your friends.
1:29:10 - 1:39:33 (10:22)
Summary
The key to being a good king is to leave people alone and only use your power to punish those who aggress against others, not to enrich yourself or your friends. While the ideal society would be anarchist, a monarchy may be the best way to provide people with the most freedom in a world where many people do not understand libertarian ideas and have a high time preference.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
Inflation is caused by an increase in the supply of money while the supply of goods and services remains the same.
1:39:33 - 1:47:30 (07:57)
Summary
Inflation is caused by an increase in the supply of money while the supply of goods and services remains the same. Attempts to fix the problem of inflation with price controls usually make things worse.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
This episode discusses the origins of fiat money and how it came to replace gold-backed currency during the First World War.
1:47:30 - 1:52:39 (05:08)
Summary
This episode discusses the origins of fiat money and how it came to replace gold-backed currency during the First World War. We learn about the Bank of England's decision to encourage its customers to turn in their gold for paper money, the cost of mining gold, and how it all led to the use of fiat money as we know it today.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
In this episode, the second part of the Fiat Standard series, the hosts discuss the impact of fiat money on various aspects of life such as food, science, and education.
1:52:39 - 1:59:39 (07:00)
Summary
In this episode, the second part of the Fiat Standard series, the hosts discuss the impact of fiat money on various aspects of life such as food, science, and education. They explore the most significant negative effect of fiat money, including the cost and inefficiency of moving money across borders.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The global fiat supply has been increasing at around 14% per year, making it difficult to accurately measure the value of currency.
1:59:39 - 2:04:20 (04:40)
Summary
The global fiat supply has been increasing at around 14% per year, making it difficult to accurately measure the value of currency. A gold standard would provide a more stable measure of value and encourage focusing on the future rather than prioritizing the present.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
Becoming a successful engineer requires spending a significant amount of time keeping up with economic and geopolitical events that can affect the industries and markets you work in.
2:04:20 - 2:11:42 (07:22)
Summary
Becoming a successful engineer requires spending a significant amount of time keeping up with economic and geopolitical events that can affect the industries and markets you work in.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The fiat system allowed institutions with the privilege to issue loans, backed by the central bank, to create new currency each time a loan was issued, replacing gold mining with credit creation.
2:11:42 - 2:19:07 (07:24)
Summary
The fiat system allowed institutions with the privilege to issue loans, backed by the central bank, to create new currency each time a loan was issued, replacing gold mining with credit creation. The breakdown of the fiat system is discussed in this podcast episode.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The global monetary system operates around the dollar, making it a winner-take-all situation, with all other currencies being considered as "dollar plus country risk."
2:19:07 - 2:24:44 (05:36)
Summary
The global monetary system operates around the dollar, making it a winner-take-all situation, with all other currencies being considered as "dollar plus country risk." The rise of digital currencies may bring about similar circumstances.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The implementation of a global monetary system faces the dilemma of who will have the final say, despite the efforts of governments to create their own monetary systems based on credit or copper grains, ultimately, billions of people would want to trade with one another.
2:24:44 - 2:30:59 (06:14)
Summary
The implementation of a global monetary system faces the dilemma of who will have the final say, despite the efforts of governments to create their own monetary systems based on credit or copper grains, ultimately, billions of people would want to trade with one another.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
In this episode, the speakers discuss why commodity-based systems won't work, as well as the history of hard money, inflation, fiat, and war in the 20th and 21st centuries, concluding that the best money is the one that leaks the least; i.e., gold, which only leaks 1.5% per year.
2:30:59 - 2:36:21 (05:22)
Summary
In this episode, the speakers discuss why commodity-based systems won't work, as well as the history of hard money, inflation, fiat, and war in the 20th and 21st centuries, concluding that the best money is the one that leaks the least; i.e., gold, which only leaks 1.5% per year.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The speaker discusses how Bitcoin fixed the problem of easy money which is seen as a significant invention due to the fact that many problems in the world are caused by inflation and government having access to peoples' wealth.
2:36:21 - 2:45:20 (08:58)
Summary
The speaker discusses how Bitcoin fixed the problem of easy money which is seen as a significant invention due to the fact that many problems in the world are caused by inflation and government having access to peoples' wealth.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The number of nodes in digital currencies is often not publicized as they do not have full nodes in the true sense, and it doesn't even matter how many nodes they have.
2:45:20 - 2:53:52 (08:32)
Summary
The number of nodes in digital currencies is often not publicized as they do not have full nodes in the true sense, and it doesn't even matter how many nodes they have. Miners solve a proof of work problem and present it to the nodes for ratification and approval.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
Energy consumption is essential for improving quality of life, and it is unfair to deny poor countries access to the same energy sources used in rich countries.
2:53:52 - 3:03:23 (09:30)
Summary
Energy consumption is essential for improving quality of life, and it is unfair to deny poor countries access to the same energy sources used in rich countries. Comparing the energy consumption of Bitcoin to everyday modern appliances like washing machines highlights the discrepancy in perspective.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The speaker fell in love with Diego Maradona's style of play and Argentina's performance in football.
3:03:23 - 3:06:43 (03:20)
Summary
The speaker fell in love with Diego Maradona's style of play and Argentina's performance in football. The fun in football is picking a team or player and appreciating their performance and genius on the field.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
As an investor, considering cryptocurrency over fiat assets requires a tolerance for volatility, but with only $1 trillion in comparison to the $100 trillion market of fiat assets, Bitcoin still offers a significant opportunity.
3:06:43 - 3:17:17 (10:33)
Summary
As an investor, considering cryptocurrency over fiat assets requires a tolerance for volatility, but with only $1 trillion in comparison to the $100 trillion market of fiat assets, Bitcoin still offers a significant opportunity. While governments going back to a gold standard could pose a threat, the volatility of Bitcoin has been decreasing over time, making it a safer long-term investment.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The concept of community in politics can be a tool for manipulation, and some people believe that alt coins are an attempt to preserve the fiat economy.
3:17:17 - 3:24:13 (06:56)
Summary
The concept of community in politics can be a tool for manipulation, and some people believe that alt coins are an attempt to preserve the fiat economy. The cryptocurrency community can be unfriendly to newcomers due to the prevalence of schemes to sell alt coins.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
In the world of social media and crypto, it's important to curate your experience by only following people that you actually like, but people also need to understand that they don't have to follow people they dislike.
3:24:13 - 3:28:44 (04:31)
Summary
In the world of social media and crypto, it's important to curate your experience by only following people that you actually like, but people also need to understand that they don't have to follow people they dislike.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
In this podcast, the speaker talks about how a small group of people in charge can result in corruption and coercion, and the importance of being introspective about biases.
3:28:45 - 3:36:32 (07:47)
Summary
In this podcast, the speaker talks about how a small group of people in charge can result in corruption and coercion, and the importance of being introspective about biases. They also discuss a tweet from a few years ago comparing proof of work to the invention of flight.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The growth of centralized apps is inevitable because businesses require a centralized authority to make decisions, while the demand for decentralized apps will come from people who trust that it will not be messed with.
3:36:32 - 3:45:00 (08:27)
Summary
The growth of centralized apps is inevitable because businesses require a centralized authority to make decisions, while the demand for decentralized apps will come from people who trust that it will not be messed with.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
Exploring a world without banks in which the government has complete control over the creation and distribution of money.
3:45:00 - 3:50:40 (05:39)
Summary
Exploring a world without banks in which the government has complete control over the creation and distribution of money.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
In this podcast episode, a Bitcoin believer shares his advice for young adults looking to have a successful career and a life to be proud of.
3:50:40 - 4:01:08 (10:28)
Summary
In this podcast episode, a Bitcoin believer shares his advice for young adults looking to have a successful career and a life to be proud of. He also discusses the potential political implications of the switch to Bitcoin from fiat money.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
In this episode, the importance of thinking about the long-term implications of your decisions is emphasized, particularly when it comes to creating value online and investing in coding skills.
4:01:08 - 4:06:29 (05:20)
Summary
In this episode, the importance of thinking about the long-term implications of your decisions is emphasized, particularly when it comes to creating value online and investing in coding skills.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The emergence of fiat money has allowed people who have never experienced war, and never will, to make uninformed decisions about sending others to fight and die.
4:06:29 - 4:18:10 (11:41)
Summary
The emergence of fiat money has allowed people who have never experienced war, and never will, to make uninformed decisions about sending others to fight and die. This has allowed colonialist efforts to continue and the escalation of war around the world.
Episode#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics
PodcastLex Fridman Podcast
The speaker values his time highly and will not tolerate anyone wasting it.
4:18:10 - 4:20:37 (02:26)
Summary
The speaker values his time highly and will not tolerate anyone wasting it. He has spent a lot of time introspecting and thinking about time management.