Robert Breedlove: Philosophy of Bitcoin from First Principles

Lex Fridman (01:24.560)

will be muddled by excitement

Robert Breedlove (01:26.360)

if I invest before I understand.

Lex Fridman (01:29.000)

I feel the same way about Tesla, for example.

Robert Breedlove (01:31.320)

I still don't own any Tesla stock

Lex Fridman (01:33.800)

and I am still indeed fascinated by Tesla Autopilot

Robert Breedlove (01:37.340)

as an artificial intelligence system.

Lex Fridman (01:39.500)

I work hard to be cognizant of the biases

Robert Breedlove (01:42.600)

that arise in my mind and always try to choose the path

Lex Fridman (01:47.280)

that maximizes or maintains a freedom of thought

Robert Breedlove (01:52.040)

as much as possible.

Lex Fridman (01:53.720)

Also, let me say that I try to be very careful

Robert Breedlove (01:56.200)

in selecting guests based not only on the contents

Lex Fridman (01:59.440)

of their ideas, but the richness, complexity, music,

Robert Breedlove (02:03.000)

style of their mind and character.

Lex Fridman (02:05.140)

Yes, I will talk with people with whom you

Lex Fridman (02:08.020)

and I may disagree, people who some may call bad

Lex Fridman (02:12.080)

or even evil human beings.

Robert Breedlove (02:14.840)

I want to understand them because I believe that,

Lex Fridman (02:18.100)

as Solzhenitsyn said, the battle line between good and evil

Robert Breedlove (02:22.520)

runs through the heart of every man.

Lex Fridman (02:25.140)

I think if you always run from evil,

Robert Breedlove (02:27.040)

you become blind to the truth of human nature.

Lex Fridman (02:30.440)

This is the Lex Friedman Podcast

Lex Fridman (02:32.800)

and here is my conversation with Robert Breedlove.

Lex Fridman (02:37.280)

Rousseau opens his 1762 book, The Social Contract,

Robert Breedlove (02:41.480)

with the following statement.

Lex Fridman (02:43.380)

"'Man is born free and everywhere he is in chains.'"

Lex Fridman (02:47.460)

So you talk about freedom and sovereignty quite a bit.

Lex Fridman (02:50.800)

What do these ideas mean to you, the idea of sovereignty?

Robert Breedlove (02:54.640)

Freedom and sovereignty, I think they're very

Lex Fridman (02:57.840)

closely related.

Robert Breedlove (03:00.000)

Let's start just focusing on sovereignty,

Lex Fridman (03:01.740)

which is a word I don't think we talk about enough.

Lex Fridman (03:04.840)

And the general definition of that I would give

Lex Fridman (03:07.120)

is the authority to act as you see fit.

Lex Fridman (03:12.760)

And it's a word that's etymologically associated

Lex Fridman (03:15.840)

with words like monarchy, money, reign.

Lex Fridman (03:19.280)

So historically, it's referred to whatever the locus

Lex Fridman (03:23.520)

of supreme power is in the sphere of human action.

Lex Fridman (03:26.240)

So whether, if you go like back into ancient Egypt,

Lex Fridman (03:30.120)

the Pharaoh had absolute sovereignty

Lex Fridman (03:32.400)

and everyone else was pretty much operating

Lex Fridman (03:34.800)

according to his interests.

Robert Breedlove (03:36.800)

You fast forward to today, modern Western democracy,

Lex Fridman (03:40.200)

we have more decentralized sovereignty

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and that we all get to go vote and elect officials

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that make decisions on our behalf.

Lex Fridman (03:47.700)

So the theme of sovereignty across history

Lex Fridman (03:51.000)

is that it's been gradually decentralizing

Robert Breedlove (03:52.760)

across our different models of socioeconomics.

Lex Fridman (03:56.800)

And it's largely, you could say it's rooted heavily

Robert Breedlove (04:01.100)

in the money, I would argue,

Lex Fridman (04:03.080)

which is something we'll get a lot into here,

Robert Breedlove (04:04.700)

where if you have money, you have the authority

Lex Fridman (04:08.320)

to act as you see fit in the world.

Lex Fridman (04:11.420)

And even in our current political sphere,

Lex Fridman (04:14.160)

if you have enough money, you can actually reshape the rules.

Robert Breedlove (04:17.000)

You can reshape laws, you can lobby Congress.

Lex Fridman (04:21.400)

If you're in a certain situation, like many billionaires,

Robert Breedlove (04:24.640)

you can negotiate your own tax treaty

Lex Fridman (04:26.640)

such that you can get favorable tax treatment

Robert Breedlove (04:28.520)

with certain jurisdictions in the world.

Lex Fridman (04:30.440)

So this concept of sovereignty, which today we call,

Robert Breedlove (04:35.360)

it's common to call states or nation states

Lex Fridman (04:39.440)

or government sovereign,

Robert Breedlove (04:41.080)

meaning that they have power over people.

Lex Fridman (04:44.600)

But as I argue in a lot of my writing,

Robert Breedlove (04:46.040)

I actually think that sovereignty

Lex Fridman (04:48.000)

and here's within the individual

Lex Fridman (04:49.960)

and that we each have our own interiorized space of choice,

Lex Fridman (04:54.720)

which is something like Victor Frankl

Robert Breedlove (04:56.120)

called the final human freedom.

Lex Fridman (04:58.080)

And that we, no matter what our circumstances are,

Robert Breedlove (05:00.440)

no matter what exogenous situation we face,

Lex Fridman (05:03.340)

we always have this endogenous power

Robert Breedlove (05:05.360)

to choose how we respond to it.

Lex Fridman (05:07.640)

That's one of my favorite books is,

Robert Breedlove (05:09.280)

A Man's Search for Meaning.

Lex Fridman (05:11.120)

Maybe we can break that apart a little bit.

Lex Fridman (05:13.360)

So you've kind of spoken about sovereignty

Lex Fridman (05:16.880)

as a closely linked to power,

Lex Fridman (05:20.000)

but is there something about your own mind

Lex Fridman (05:22.240)

being able to achieve sovereignty

Robert Breedlove (05:25.400)

no matter what the monetary system is,

Lex Fridman (05:27.260)

no matter what, who has the control over centralized power,

Robert Breedlove (05:30.240)

the money or whatever the mechanisms of sovereignty

Lex Fridman (05:34.040)

and the societal level?

Robert Breedlove (05:35.280)

You as an individual, isn't ultimately all boiled down

Lex Fridman (05:39.200)

to what you can do with your mind, how you see the world?

Lex Fridman (05:42.560)

How you interpret it.

Lex Fridman (05:43.600)

Yeah, I agree.

Lex Fridman (05:45.040)

And as we get a little bit deeper into this,

Lex Fridman (05:47.520)

I think we'll come to see money

Robert Breedlove (05:48.680)

as an extension of your mind.

Lex Fridman (05:50.600)

So there's a feedback between money and mind.

Robert Breedlove (05:52.560)

For instance, you think in dollars today,

Lex Fridman (05:54.840)

almost guarantee it, most of us do here in the US.

Lex Fridman (05:58.960)

And it's a tool, right?

Lex Fridman (06:00.200)

It's a tool we're using to decomplexify the world around us,

Robert Breedlove (06:03.320)

to deal with it, to understand the sacrifices and successes

Lex Fridman (06:08.700)

across an entire history of economic transactions.

Robert Breedlove (06:10.840)

We can boil that all down to the price.

Lex Fridman (06:12.400)

So it's data compression.

Lex Fridman (06:14.360)

And if you can change,

Lex Fridman (06:17.600)

if there's a central body or central governance mechanism

Robert Breedlove (06:20.800)

that can manipulate that money,

Lex Fridman (06:21.880)

it can have an impact on your mind.

Robert Breedlove (06:25.480)

For instance, today, so I agree with you on the first hand,

Lex Fridman (06:28.200)

say that I do believe in free will.

Robert Breedlove (06:32.140)

I do believe in individual autonomy,

Lex Fridman (06:34.860)

but I also think that there are certain devices and powers

Robert Breedlove (06:39.160)

in the world around us

Lex Fridman (06:40.000)

that can actually influence how we think.

Lex Fridman (06:42.120)

And it's fascinating to think about the fact

Lex Fridman (06:44.280)

that money might be actually deeply integrated

Robert Breedlove (06:46.960)

into the way we think and into our mind.

Lex Fridman (06:51.320)

You think about what are the core aspects of the human mind?

Lex Fridman (06:54.120)

What influences cognition,

Lex Fridman (06:56.000)

the way you reason about the world?

Robert Breedlove (06:58.320)

You have the Chomsky languages at the core of everything,

Lex Fridman (07:02.080)

but you're kind of placing money as pretty close

Robert Breedlove (07:06.880)

to the core of what it means

Lex Fridman (07:08.660)

to be an intelligent reasoning human.

Robert Breedlove (07:11.960)

I think money is a direct derivation

Lex Fridman (07:14.440)

of action and speech, actually.

Robert Breedlove (07:16.120)

It's another expression of the logos.

Lex Fridman (07:19.160)

If we even think of what it means to think

Robert Breedlove (07:23.000)

is that we are generating two different courses of action,

Lex Fridman (07:26.880)

potential courses of action,

Lex Fridman (07:28.600)

and we're populating them with avatars, right?

Lex Fridman (07:31.120)

Maybe ourselves or others.

Lex Fridman (07:32.680)

And then we're comparing how we may act in each situation

Lex Fridman (07:36.000)

and what we think the result would be.

Lex Fridman (07:37.400)

So actually it's comparison.

Lex Fridman (07:40.240)

Basically it's comparison and contrasting

Robert Breedlove (07:41.880)

of possible courses of action.

Lex Fridman (07:44.260)

And that's the same thing with words themselves.

Robert Breedlove (07:48.820)

Most words, the vast majority of words

Lex Fridman (07:53.180)

only have meaning in relationship to other words, right?

Robert Breedlove (07:55.760)

It's all contextual definitions of a word or more words.

Lex Fridman (07:59.520)

Now people have argued with me about this

Lex Fridman (08:01.100)

because there is a first word, right?

Lex Fridman (08:02.780)

Where you pick up rock and say rock.

Lex Fridman (08:04.920)

But most other words in higher abstraction

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tend to be relative.

Lex Fridman (08:10.400)

And what's funny about action and speech,

Lex Fridman (08:15.440)

and this gets, I got into a bit of this in our paper here,

Robert Breedlove (08:18.380)

is that it's linked to evolutionary biology

Lex Fridman (08:21.740)

and that once human beings adopted upright stance,

Robert Breedlove (08:26.400)

we freed our hands.

Lex Fridman (08:27.940)

We no longer needed our hands for locomotion.

Lex Fridman (08:30.300)

So we started to evolve more dexterity

Lex Fridman (08:34.280)

and notably we have opposable thumbs.

Lex Fridman (08:35.920)

So this gives us an ability to manipulate

Lex Fridman (08:38.520)

and particularize the environment

Robert Breedlove (08:39.960)

in a way that most other animals cannot.

Lex Fridman (08:42.360)

And what's interesting about this is that

Robert Breedlove (08:44.120)

as we gain this ability to manipulate natural resources

Lex Fridman (08:49.020)

and count, point, pointing was a big deal

Lex Fridman (08:52.040)

and that we could indicate prey

Lex Fridman (08:54.640)

or items that are far off distance

Lex Fridman (08:56.600)

and we could organize ourselves.

Lex Fridman (09:00.560)

At the same time we co evolved this fine musculature

Robert Breedlove (09:04.240)

in the face and tongue.

Lex Fridman (09:05.960)

So it's as if speech developed,

Robert Breedlove (09:07.920)

co evolved really with our dexterity.

Lex Fridman (09:10.840)

And as a natural extension of that came us making tools.

Robert Breedlove (09:17.120)

Right, we started to create things

Lex Fridman (09:18.400)

to better satisfy our wants over time.

Lex Fridman (09:21.280)

And the most tradable tool in any society

Lex Fridman (09:24.940)

or the most tradable thing is money.

Lex Fridman (09:26.680)

So I really, I argue that action and speech

Lex Fridman (09:31.240)

are quintessential modes of self sovereign expression.

Lex Fridman (09:35.280)

And the money is just sort of a tech layer

Lex Fridman (09:37.300)

we've put right on top of that.

Lex Fridman (09:38.920)

And that it's a natural derivation of action and speech.

Lex Fridman (09:42.300)

Okay, that's fascinating to think about sovereignty

Robert Breedlove (09:44.980)

from the evolutionary perspective.

Lex Fridman (09:47.240)

And then ultimately money is the technology layer

Robert Breedlove (09:50.240)

that enables sovereignty.

Lex Fridman (09:52.000)

So, you know, it's really fascinating to think about

Robert Breedlove (09:57.360)

our modern human society as deeply rooted

Lex Fridman (10:01.120)

in these like evolutionary roots

Robert Breedlove (10:03.280)

from the very origins of life on earth.

Lex Fridman (10:05.380)

So what, you know, some of the ideas you just mentioned,

Lex Fridman (10:09.780)

what do you see are some interesting characteristics

Lex Fridman (10:13.080)

of just life on earth that propagated to us humans?

Robert Breedlove (10:18.320)

Like what ideas propagated through,

Lex Fridman (10:20.920)

have roots in the evolution?

Robert Breedlove (10:23.540)

Yeah, I think one of the deepest impulsions in life

Lex Fridman (10:28.040)

is the territorial imperative.

Lex Fridman (10:29.880)

So all life is seeking to expand its dominion

Lex Fridman (10:35.260)

over space and time.

Lex Fridman (10:37.200)

And we think about, you know, again, physically with space,

Lex Fridman (10:40.940)

it's advantageous to an animal or an organism

Robert Breedlove (10:43.720)

to have more territory under its control

Lex Fridman (10:45.940)

to raise offspring.

Lex Fridman (10:47.920)

So it's all about reproductive fitness

Lex Fridman (10:49.660)

at the end of the day.

Lex Fridman (10:50.880)

And then we'd also think of reproduction itself

Lex Fridman (10:53.840)

as the genetic impulse to have more,

Robert Breedlove (10:57.000)

to replicate oneself across time.

Lex Fridman (10:58.880)

So it's territoriality across time in a way.

Lex Fridman (11:02.000)

And this is very common in most animals.

Lex Fridman (11:04.040)

Not all animals are territorial, but many are.

Lex Fridman (11:07.560)

And you see very interesting behaviors

Lex Fridman (11:10.000)

resulting from territoriality.

Robert Breedlove (11:11.560)

This is like animal combat.

Lex Fridman (11:13.800)

You know, the reason birds sing is territoriality,

Robert Breedlove (11:17.960)

a number of other things.

Lex Fridman (11:19.640)

And it's my hypothesis and others have shared

Robert Breedlove (11:23.600)

this hypothesis as well, that mankind is clearly,

Lex Fridman (11:28.080)

I think, would argue a territorial species

Lex Fridman (11:30.280)

and that he expresses this territoriality in property rights.

Lex Fridman (11:35.000)

So property, when we hear that word,

Robert Breedlove (11:38.200)

we typically think of an asset.

Lex Fridman (11:39.480)

We think of, oh, this house or this stock or whatever.

Lex Fridman (11:42.220)

But property is actually the socially acknowledged

Lex Fridman (11:45.080)

relationship between a human and an asset,

Robert Breedlove (11:48.140)

such that you have exclusive rights and responsibilities

Lex Fridman (11:51.100)

to a particular asset.

Robert Breedlove (11:53.860)

It is not the asset itself.

Lex Fridman (11:55.480)

So property, it's information, it's a relationship.

Robert Breedlove (11:59.480)

By the way, my mind was just blown.

Lex Fridman (12:01.120)

Property is information, it's not the actual asset.

Robert Breedlove (12:04.200)

That's really important.

Lex Fridman (12:05.580)

Very important.

Robert Breedlove (12:06.560)

That's really interesting.

Lex Fridman (12:07.520)

Yeah, and then it comes down to how do we organize ourselves

Robert Breedlove (12:12.520)

such that property, that the contributions people are making

Lex Fridman (12:19.400)

are commensurate with the consideration they're receiving.

Lex Fridman (12:22.160)

So if you're adding value to a piece of property,

Lex Fridman (12:24.720)

you're developing a piece of land for use,

Robert Breedlove (12:27.920)

in theory, to be fair, you should have the rights

Lex Fridman (12:31.880)

to that fruit if you go out and plant a garden

Robert Breedlove (12:34.100)

or whatever it may be.

Lex Fridman (12:37.480)

And this is rooted in natural law,

Robert Breedlove (12:41.640)

where we have rights to life, liberty, and property.

Lex Fridman (12:44.440)

Those are kind of just the base,

Robert Breedlove (12:46.000)

the fundamental layer of morality and capitalism, frankly.

Lex Fridman (12:49.920)

And you could think of, to get really primordial with it,

Robert Breedlove (12:54.320)

the first capitalist in the world,

Lex Fridman (12:57.960)

just to kind of get some definitions out here,

Robert Breedlove (12:59.700)

I'll say capitalism versus communism or socialism

Lex Fridman (13:03.960)

as the spectrum I'll speak on.

Robert Breedlove (13:06.040)

The first capitalist in the world would be the guy,

Lex Fridman (13:09.400)

the caveman, that maybe dug a little hole for himself

Robert Breedlove (13:12.380)

to shield himself from the elements.

Lex Fridman (13:14.920)

Maybe there was a rainstorm or a snowstorm

Lex Fridman (13:17.240)

and he dug a little enclave and he protected himself.

Lex Fridman (13:20.600)

I thought you were gonna go, because you said primordial,

Robert Breedlove (13:22.920)

I thought you were gonna go back to like

Lex Fridman (13:24.560)

earlier biological systems.

Robert Breedlove (13:27.160)

I guess primordial for human, perhaps.

Lex Fridman (13:29.240)

For humans, yeah.

Robert Breedlove (13:30.600)

Okay.

Lex Fridman (13:31.440)

And then the first communist or socialist

Robert Breedlove (13:34.100)

would be someone that decided the fruits of his labor

Lex Fridman (13:37.360)

belonged to him.

Lex Fridman (13:38.800)

So he would have violently encroached on that individual

Lex Fridman (13:41.280)

and taken his plot for himself, for his own use.

Lex Fridman (13:45.180)

And that's the spectrum across which capitalism,

Lex Fridman (13:50.180)

in the pure sense, and communism in the pure sense operate

Robert Breedlove (13:53.560)

in that capitalism, each individual has the exclusive rights

Lex Fridman (13:57.640)

to the fruits of their labor.

Lex Fridman (13:59.180)

So anything they spend their time, effort, energy

Lex Fridman (14:02.160)

creating in the world, they own the rights to that

Lex Fridman (14:04.960)

and they can trade those rights with others,

Lex Fridman (14:07.080)

other self owned people that have done similar things.

Robert Breedlove (14:10.360)

Communism or socialism would imply that other people,

Lex Fridman (14:13.740)

typically the state, have the rights,

Robert Breedlove (14:16.040)

at least some rights to the value you've created.

Lex Fridman (14:19.580)

So there's this interesting moment when that first caveman,

Robert Breedlove (14:22.520)

that first capitalist drew a line, a circle in this cave

Lex Fridman (14:27.400)

and said, you know, this is mine.

Robert Breedlove (14:29.920)

You could say it was free to be claimed

Lex Fridman (14:32.240)

at the time he claimed it.

Lex Fridman (14:34.600)

But it's an interesting moment when asset becomes an asset.

Lex Fridman (14:41.640)

When space time, as you were referring to it,

Robert Breedlove (14:43.600)

becomes something that's now can be possessed

Lex Fridman (14:46.860)

by a human being.

Lex Fridman (14:47.960)

Is there something special about this moment?

Lex Fridman (14:51.100)

Because it feels like, first of all,

Robert Breedlove (14:53.820)

in terms of space and time, it feels like there's a lot

Lex Fridman (14:57.660)

of available space time yet to be claimed.

Lex Fridman (15:02.700)

So if we just look at like the universe, right?

Lex Fridman (15:05.380)

We're talking about, there's a funny thing

Robert Breedlove (15:06.960)

with Elon Musk and Mars, I think they sneaked in there

Lex Fridman (15:11.220)

for SpaceX, that nobody on earth has any authority

Robert Breedlove (15:15.540)

on Mars or any, this is a very interesting question.

Lex Fridman (15:18.980)

It seems almost like humorous at this time,

Lex Fridman (15:20.980)

but perhaps not, perhaps there'll be sections of space,

Lex Fridman (15:25.200)

not just on planets that are gonna be even fought over.

Lex Fridman (15:29.020)

So is there something special about this moment?

Lex Fridman (15:31.020)

Because in discussing sort of violence

Lex Fridman (15:35.140)

and respect for property, it feels like this is

Lex Fridman (15:37.440)

a special moment because ultimately conflict arises

Robert Breedlove (15:42.440)

when you make claims on a particular territory.

Lex Fridman (15:46.640)

It's not always in conflict where people say,

Robert Breedlove (15:50.200)

when you look at Hitler or something, for example,

Lex Fridman (15:52.800)

his claim would be in many of the lands that he attacked

Lex Fridman (15:57.040)

and invaded that this is ultimately,

Lex Fridman (15:59.720)

this has always belonged to Germany.

Lex Fridman (16:02.680)

So is there something you could say as to like

Lex Fridman (16:06.200)

what it means to own an asset or a property?

Robert Breedlove (16:09.440)

Yeah, so in the ancient days of hunters and gatherers,

Lex Fridman (16:14.000)

we could say that property was mostly a loyal title,

Lex Fridman (16:19.240)

which meant it's just whatever you can defend, right?

Lex Fridman (16:22.360)

So if you've got knives and daggers and satchels

Lex Fridman (16:25.600)

and maybe some pelts you've hunted,

Lex Fridman (16:28.760)

whatever you can hold and defend is yours.

Lex Fridman (16:32.160)

And there's not like, there's a government to appeal to,

Lex Fridman (16:35.320)

you're just sort of a free agent operating in the wild,

Robert Breedlove (16:39.120)

defending the assets you can protect on you more or less.

Lex Fridman (16:44.440)

And what really changed the nature of property

Robert Breedlove (16:48.360)

is when we get into the agricultural age.

Lex Fridman (16:50.780)

So there's a big flip where we went from just foraging

Lex Fridman (16:55.240)

and hunting all the time, constantly moving,

Lex Fridman (16:57.320)

trying to stay alive to deciding we're gonna settle here.

Robert Breedlove (17:00.440)

We figured out how to cultivate crops.

Lex Fridman (17:03.200)

We can create, we can increase the population

Robert Breedlove (17:06.080)

because we can harvest more energy from the sun

Lex Fridman (17:08.480)

and we can establish a longer term civilization.

Lex Fridman (17:11.280)

What happens in that transition

Lex Fridman (17:13.600)

is that we begin creating economic surplus.

Lex Fridman (17:16.480)

So for the first time in history,

Lex Fridman (17:17.680)

we have stock houses of grain to defend

Robert Breedlove (17:22.040)

or maybe meat or cattle or whatever it is we're creating,

Lex Fridman (17:25.260)

we now have savings.

Lex Fridman (17:27.960)

And it's at that time when government emerges as well,

Lex Fridman (17:33.420)

because once you have savings

Robert Breedlove (17:35.120)

or you have an economic surplus,

Lex Fridman (17:36.320)

you have something that other people want to steal, right?

Robert Breedlove (17:39.000)

This one thing we'll touch on a lot today

Lex Fridman (17:41.760)

is people always want something for nothing.

Robert Breedlove (17:45.880)

People are always seeking the path

Lex Fridman (17:47.440)

to get something for nothing.

Lex Fridman (17:48.360)

And I think that drives a lot of our decision making.

Lex Fridman (17:51.600)

And it actually encourages us to be innovative

Lex Fridman (17:53.680)

in a lot of ways, right?

Lex Fridman (17:54.520)

We're trying to, you could say it's our laziness

Robert Breedlove (17:58.060)

that's helping us be inventive in a way.

Lex Fridman (17:59.760)

We're trying to accomplish greater results

Robert Breedlove (18:01.420)

with less efforts over time,

Lex Fridman (18:02.940)

but we can cross that line in seeking something for nothing

Robert Breedlove (18:07.440)

where we start to violate the life, liberty,

Lex Fridman (18:09.240)

and property of others.

Lex Fridman (18:10.320)

And that's where we shift from kind of capitalistic society

Lex Fridman (18:13.160)

to something more communistic.

Lex Fridman (18:15.560)

And so that's what government is.

Lex Fridman (18:18.840)

It's a protection producing enterprise

Robert Breedlove (18:21.680)

for the economic surplus generated by a trading society.

Lex Fridman (18:25.860)

So when people begin to trade,

Robert Breedlove (18:28.460)

they create what's called the division of labor,

Lex Fridman (18:30.920)

which is a very common economic term,

Robert Breedlove (18:33.020)

basically means you're better at making hats,

Lex Fridman (18:35.440)

I'm better at making boots.

Robert Breedlove (18:37.440)

If you specialize in hats, I specialize in boots,

Lex Fridman (18:39.840)

and we trade, we've created a positive sum game

Robert Breedlove (18:42.600)

where you and I both benefit.

Lex Fridman (18:43.840)

So we become collectively more than the sum of our parts

Robert Breedlove (18:47.000)

through trade.

Lex Fridman (18:48.320)

And that's why human beings do trade

Robert Breedlove (18:51.360)

because we become more energy efficient as a result.

Lex Fridman (18:54.040)

We create more outputs per unit of input.

Lex Fridman (18:56.560)

And you can think of government in that respect,

Lex Fridman (18:59.280)

if we're looking at it maybe in a tech sense

Robert Breedlove (19:01.240)

that the economy is the trade network that generates wealth,

Lex Fridman (19:05.220)

generates innovation, generates all,

Robert Breedlove (19:07.160)

this whole lap of luxury we live in today

Lex Fridman (19:09.120)

that we've inherited from our forebears is from the market.

Robert Breedlove (19:12.680)

It's not from a government.

Lex Fridman (19:14.120)

The government is the network security, if you will.

Lex Fridman (19:17.500)

So we're paying expenses to a vendor to protect peace,

Lex Fridman (19:21.880)

to preserve life, liberty, and property in that network

Lex Fridman (19:24.480)

so that we can have, you know,

Lex Fridman (19:25.760)

when there's inevitably disputes over private property,

Robert Breedlove (19:28.100)

we can have nonviolent dispute resolution

Lex Fridman (19:30.720)

in the rule of law.

Lex Fridman (19:33.280)

And we can have a reasonable expectation

Lex Fridman (19:36.040)

of being able to conduct commerce without violence.

Robert Breedlove (19:39.440)

The problem has been that the protector tends to,

Lex Fridman (19:43.680)

you know, they're in a monopolistic position, we would say.

Robert Breedlove (19:46.080)

They tend to start abusing that position

Lex Fridman (19:49.260)

to obtain property for themselves.

Robert Breedlove (19:53.040)

Again, trying to get that something for nothing.

Lex Fridman (19:55.840)

When you control, you know, you are the security guard

Lex Fridman (1:00:01.220)

So something like the artist,

Lex Fridman (1:00:03.180)

the artist uses lies to point to the truth,

Robert Breedlove (1:00:06.820)

something like that, that kind of thing.

Lex Fridman (1:00:10.140)

That's really good.

Lex Fridman (1:00:10.980)

But the American pragmatist said that,

Lex Fridman (1:00:13.700)

because at the end of the day, this is all about,

Robert Breedlove (1:00:16.300)

when we say truth, we need something

Lex Fridman (1:00:18.580)

that is close to social consensus

Lex Fridman (1:00:23.420)

and is not shakable by political action.

Lex Fridman (1:00:25.980)

So that's what physics and mathematics are.

Robert Breedlove (1:00:28.380)

It's an unshakable point of reference,

Lex Fridman (1:00:33.940)

I guess you might say.

Lex Fridman (1:00:35.140)

So the American pragmatist defined truth

Lex Fridman (1:00:39.420)

as the end of inquiry.

Lex Fridman (1:00:42.460)

And in markets, we could say that the market itself

Lex Fridman (1:00:48.420)

is a forum that generates truth.

Robert Breedlove (1:00:50.620)

We call this pragmatic truth

Lex Fridman (1:00:51.940)

to separate pure objective truth

Robert Breedlove (1:00:53.940)

that we can't even talk about without polluting it

Lex Fridman (1:00:56.580)

versus pragmatic truth,

Robert Breedlove (1:00:57.700)

which is something that's useful.

Lex Fridman (1:00:59.340)

So the example here would be,

Robert Breedlove (1:01:01.940)

if I give you a map and you're trying to go

Lex Fridman (1:01:05.580)

from your house to the local brisket restaurant,

Lex Fridman (1:01:09.060)

and the map gets you from your house

Lex Fridman (1:01:10.780)

to the brisket restaurant,

Robert Breedlove (1:01:12.420)

is that because the map is true

Lex Fridman (1:01:13.940)

or is that because the map is useful?

Robert Breedlove (1:01:16.740)

They're very hard to disentangle

Lex Fridman (1:01:18.620)

when you're just looking at it pragmatically.

Lex Fridman (1:01:21.420)

And in markets, markets, I argue,

Lex Fridman (1:01:23.900)

generate three forms of pragmatic truth.

Robert Breedlove (1:01:26.460)

One is the price.

Lex Fridman (1:01:28.420)

So this is the collective subjective demand

Lex Fridman (1:01:33.420)

and purchasing power of humanity

Lex Fridman (1:01:35.860)

running up against the objective supply of capital

Lex Fridman (1:01:39.860)

and resources in the marketplace.

Lex Fridman (1:01:41.820)

So there's demand overlaid on supply.

Robert Breedlove (1:01:44.380)

The result of that is the price.

Lex Fridman (1:01:46.060)

So that is the most truthful exchange ratio,

Robert Breedlove (1:01:51.260)

which is the closest approximation to the value

Lex Fridman (1:01:54.180)

of any good in the marketplace.

Lex Fridman (1:01:56.100)

So it gives us a data point on which we can operate.

Lex Fridman (1:01:58.660)

It's compressing all known market realities

Robert Breedlove (1:02:01.420)

down into a single actionable number.

Lex Fridman (1:02:03.860)

You know, based on the price of bread or copper,

Robert Breedlove (1:02:05.980)

whether you wanna buy more of it,

Lex Fridman (1:02:07.580)

you wanna abstain from buying it,

Robert Breedlove (1:02:09.060)

or maybe you wanna try and find substitutes.

Lex Fridman (1:02:11.420)

And you can think of that price signal,

Robert Breedlove (1:02:13.940)

it's like an economic nerve signal.

Lex Fridman (1:02:15.580)

It's coordinating human action across time.

Lex Fridman (1:02:17.620)

So if we're one socioeconomic superorganism or collective,

Lex Fridman (1:02:22.900)

that the price signal is the nerve.

Lex Fridman (1:02:24.620)

And that's the first form of pragmatic truth

Lex Fridman (1:02:27.060)

that markets generate.

Robert Breedlove (1:02:28.460)

The second form would be tools and innovations themselves.

Lex Fridman (1:02:32.300)

So entrepreneurs are experimenting across time.

Robert Breedlove (1:02:35.700)

They're trying to satisfy the wants of consumers.

Lex Fridman (1:02:37.700)

Consumers are sovereign in the marketplace.

Lex Fridman (1:02:40.540)

Whatever the consumer wants, the consumer gets, right?

Lex Fridman (1:02:43.940)

I'm trying to satisfy that.

Robert Breedlove (1:02:44.980)

I'm trying to do it at a profit.

Lex Fridman (1:02:46.460)

So I'm trying to take viewing the existing price signals

Robert Breedlove (1:02:49.740)

of goods in the marketplace.

Lex Fridman (1:02:50.700)

I'm trying to assemble those in a way

Robert Breedlove (1:02:53.260)

at a cost lower than the final solution

Lex Fridman (1:02:55.780)

I'm delivering to my customer.

Robert Breedlove (1:02:57.380)

I'm selling it at a price higher

Lex Fridman (1:02:58.700)

than the productive factors I combined to create it.

Lex Fridman (1:03:02.820)

And in that iterative process,

Lex Fridman (1:03:05.100)

we're constantly discovering new and better ways

Robert Breedlove (1:03:08.980)

of solving problems or satisfying the wants.

Lex Fridman (1:03:11.420)

So we could say, to go out and dig a hole, right?

Robert Breedlove (1:03:14.900)

Someone wants a hole dug,

Lex Fridman (1:03:16.540)

that a shovel is gonna let you do it much faster per hour

Robert Breedlove (1:03:20.260)

than you would with your bare hands.

Lex Fridman (1:03:22.460)

So what is the pragmatic truth of digging holes?

Lex Fridman (1:03:26.300)

It's a shovel, right?

Lex Fridman (1:03:27.380)

It's the best way we know how to solve

Robert Breedlove (1:03:30.020)

any particular problem based on

Lex Fridman (1:03:33.020)

the existing treasury of knowledge.

Lex Fridman (1:03:35.340)

So every tool, again, we're back to ideas being fundamental.

Lex Fridman (1:03:39.140)

The shovel itself is just a knowledge structure.

Robert Breedlove (1:03:42.980)

We've figured out a way to create this particular implement

Lex Fridman (1:03:45.620)

and then we've indexed the raw materials

Robert Breedlove (1:03:47.780)

we found in nature to this knowledge structure

Lex Fridman (1:03:49.980)

to create a shovel,

Robert Breedlove (1:03:51.220)

which allows us to better satisfy human wants

Lex Fridman (1:03:55.940)

faster, cheaper, better, effectively.

Robert Breedlove (1:03:57.260)

I'm trying to generalize,

Lex Fridman (1:03:59.460)

you're blowing my mind a little bit here.

Robert Breedlove (1:04:01.220)

I'm trying to generalize the idea of tool

Lex Fridman (1:04:03.660)

to how to think about it.

Robert Breedlove (1:04:04.780)

Cause I keep just, when you say tool,

Lex Fridman (1:04:07.780)

I keep imagining different tools,

Robert Breedlove (1:04:09.580)

like specific instantiations of a tool.

Lex Fridman (1:04:12.220)

I'm trying to see, so the price is a pragmatic truth

Robert Breedlove (1:04:16.100)

that's communicating value in this network.

Lex Fridman (1:04:21.780)

Subjective demands against objective supply.

Robert Breedlove (1:04:26.660)

Subjective.

Lex Fridman (1:04:27.500)

So it's an economic democracy.

Robert Breedlove (1:04:29.260)

Got it.

Lex Fridman (1:04:30.100)

So that's the demand supply.

Lex Fridman (1:04:32.260)

And then the tools are the ways of extracting

Lex Fridman (1:04:36.380)

or solving problems is the more general kind of thing.

Robert Breedlove (1:04:39.500)

Or satisfying wants.

Lex Fridman (1:04:40.860)

Satisfying wants.

Lex Fridman (1:04:42.740)

So wants are somehow, that's part of the supply

Lex Fridman (1:04:46.980)

and the demand.

Lex Fridman (1:04:48.060)

And wants are back to value, right?

Lex Fridman (1:04:49.900)

Cause everything someone wants,

Robert Breedlove (1:04:51.140)

they're expressing their value.

Lex Fridman (1:04:53.180)

Okay.

Robert Breedlove (1:04:54.020)

Yeah.

Lex Fridman (1:04:54.860)

So the shovel is a pragmatic truth.

Robert Breedlove (1:04:57.460)

The shovel is truth.

Lex Fridman (1:04:58.860)

It feels like a good book title.

Robert Breedlove (1:05:00.540)

Okay, sorry.

Lex Fridman (1:05:01.380)

So what other pragma, what is it?

Lex Fridman (1:05:03.220)

And then the third one I would argue is virtue actually.

Lex Fridman (1:05:08.540)

Oh wow.

Lex Fridman (1:05:09.740)

And another way to maybe think about this

Lex Fridman (1:05:13.340)

is competitive competency,

Lex Fridman (1:05:14.740)

but it's also cooperative competency.

Lex Fridman (1:05:17.140)

So we're learning over time what characteristics,

Lex Fridman (1:05:20.740)

what patterns of action, what mindsets,

Lex Fridman (1:05:24.780)

what mental tools, what heuristics are most useful

Robert Breedlove (1:05:27.980)

to satisfying customer wants.

Lex Fridman (1:05:30.660)

So I think that becomes over time,

Lex Fridman (1:05:32.780)

becomes sharpened into virtue, right?

Lex Fridman (1:05:34.380)

Like we know it's best to be honest

Lex Fridman (1:05:36.500)

because if you lie, it's very energy inefficient, right?

Lex Fridman (1:05:39.340)

You're creating this little fork of reality.

Lex Fridman (1:05:41.700)

And then if someone else asks you about that lie again,

Lex Fridman (1:05:43.460)

you have to put another layer of lies on top of it.

Robert Breedlove (1:05:46.140)

Where if you just tell the truth,

Lex Fridman (1:05:47.220)

you're just recollecting what happened.

Lex Fridman (1:05:49.300)

And so that sort of keeps,

Lex Fridman (1:05:52.820)

again, when we're talking about delaying volatility, right?

Robert Breedlove (1:05:55.620)

If you lie, you're delaying short term volatility,

Lex Fridman (1:05:59.220)

but you're increasing longterm volatility.

Lex Fridman (1:06:00.860)

What about murder?

Lex Fridman (1:06:01.700)

I haven't been able to figure out why murder is bad

Robert Breedlove (1:06:04.140)

because I just keep wanting to murder people.

Lex Fridman (1:06:07.140)

And I've murdered many.

Robert Breedlove (1:06:08.300)

She's the one for that.

Lex Fridman (1:06:09.660)

Well, that's why I'm trying to get an interview

Robert Breedlove (1:06:11.820)

with Vladimir Putin.

Lex Fridman (1:06:13.380)

So that's fascinating, virtue in this market

Robert Breedlove (1:06:16.980)

with the supplies and demands, and there's the tools,

Lex Fridman (1:06:19.740)

which is also a pragmatic truth, and there's virtue.

Robert Breedlove (1:06:23.300)

It's a pragmatic truth.

Lex Fridman (1:06:24.980)

Yeah, and if we interfere with that free market process,

Robert Breedlove (1:06:28.220)

again, if we overstep, which this maybe ties into murder,

Lex Fridman (1:06:31.340)

if you start to be coercive against life,

Robert Breedlove (1:06:34.580)

liberty or property,

Lex Fridman (1:06:35.980)

so if you're forcibly taking someone's life,

Robert Breedlove (1:06:38.900)

you're breaking down the trust in that market

Lex Fridman (1:06:41.380)

that generates these pragmatic truths.

Lex Fridman (1:06:44.100)

If you forcibly infringe on someone's liberty, right?

Lex Fridman (1:06:48.700)

For any reason other than them originally breaking

Robert Breedlove (1:06:53.220)

or infringing upon life, liberty or property,

Lex Fridman (1:06:55.060)

then that's not gonna work either.

Lex Fridman (1:06:56.860)

And then if you violate private property rights,

Lex Fridman (1:06:59.340)

if you steal property from others,

Robert Breedlove (1:07:01.140)

you're breaking down the trust

Lex Fridman (1:07:04.340)

that the intersubjective fabric of money and markets

Lex Fridman (1:07:08.780)

and the rule of law, all of these useful fictions

Lex Fridman (1:07:11.140)

are meant to preserve,

Robert Breedlove (1:07:12.140)

you're corrupting it and breaking it down.

Lex Fridman (1:07:14.780)

What's kind of interesting to think about the market

Robert Breedlove (1:07:16.500)

as helping evolve the virtues.

Lex Fridman (1:07:20.580)

It's sharpened into virtues.

Lex Fridman (1:07:22.980)

And then these virtues can then go

Lex Fridman (1:07:24.700)

into motivational posters,

Robert Breedlove (1:07:27.380)

or like in books that we all agree on,

Lex Fridman (1:07:30.340)

and then eventually take for granted

Robert Breedlove (1:07:32.740)

as if they were somehow fundamental to human nature,

Lex Fridman (1:07:35.340)

but they're not perhaps fundamental,

Robert Breedlove (1:07:37.700)

they're just pragmatic truths.

Lex Fridman (1:07:40.460)

Yeah, another way to consider competition itself

Robert Breedlove (1:07:45.580)

is that it is a discovery process.

Lex Fridman (1:07:48.380)

So, you know, entrepreneurs are competing with one another

Lex Fridman (1:07:52.620)

and they're trying to best satisfy consumer wants

Lex Fridman (1:07:56.460)

at the lowest possible price.

Lex Fridman (1:07:57.700)

So they're placing bets of time, energy and capital

Lex Fridman (1:08:00.460)

on themselves, on their idea, their business plan.

Lex Fridman (1:08:03.740)

And then the market decides, right?

Lex Fridman (1:08:06.420)

The consensus of market actors decide which one was better.

Robert Breedlove (1:08:10.260)

One lives, one dies.

Lex Fridman (1:08:12.860)

So competition itself is helping us get closer to truth,

Robert Breedlove (1:08:16.900)

to pragmatic truth.

Lex Fridman (1:08:18.060)

So we're discovering what is the right price for this asset.

Lex Fridman (1:08:21.380)

And that price, by the way, it's derived,

Lex Fridman (1:08:24.180)

again, in the sense of data compression.

Robert Breedlove (1:08:26.500)

Everyone in the world can see that price.

Lex Fridman (1:08:28.940)

Everyone in the world can then put their skin in the game

Robert Breedlove (1:08:31.580)

by choosing to buy or sell or short or go long

Lex Fridman (1:08:34.300)

or do any number of financial actions on that price.

Lex Fridman (1:08:38.220)

And that information is then propagated back out

Lex Fridman (1:08:40.420)

to everyone else.

Lex Fridman (1:08:41.260)

So it's this feedback loop between market actor and price

Lex Fridman (1:08:44.980)

that makes it so useful.

Lex Fridman (1:08:48.100)

And that's what carries us,

Lex Fridman (1:08:52.500)

so it's these collisions of interest that carry us,

Robert Breedlove (1:08:56.060)

it removes the unuseful aspects of ourselves

Lex Fridman (1:09:00.900)

or of our tools or of a price

Lex Fridman (1:09:02.940)

and reveals pragmatic truth to us.

Lex Fridman (1:09:05.420)

Can you play my therapist for a second?

Lex Fridman (1:09:08.220)

And if we talk about creative destruction,

Lex Fridman (1:09:11.300)

I think, not Bukowski,

Robert Breedlove (1:09:15.260)

Hunter S. Thompson has a quote,

Lex Fridman (1:09:17.460)

something like, for all instances of beauty,

Robert Breedlove (1:09:20.940)

many souls must be trampled.

Lex Fridman (1:09:22.820)

Wow.

Lex Fridman (1:09:25.060)

But there does seem to be an aspect of competition

Lex Fridman (1:09:32.580)

that destroys, you were talking about entrepreneurs

Robert Breedlove (1:09:36.500)

sort of on the outside of the circle of order,

Lex Fridman (1:09:40.780)

striving to make sense, to compress volatility

Robert Breedlove (1:09:45.140)

of the chaos of the universe.

Lex Fridman (1:09:47.860)

Is there some way to protect a little bit

Robert Breedlove (1:09:53.420)

against the pain of that destruction

Lex Fridman (1:09:55.380)

or that creative destruction,

Robert Breedlove (1:09:57.100)

that entrepreneur screaming on fire

Lex Fridman (1:10:00.340)

as he enlightens the rest of us,

Robert Breedlove (1:10:03.660)

is there some role for us humans together

Lex Fridman (1:10:06.740)

in the togetherness of it?

Robert Breedlove (1:10:10.220)

Also government, but any kind of collectives

Lex Fridman (1:10:15.060)

in helping that entrepreneur who's on fire

Robert Breedlove (1:10:18.300)

maybe after a few minutes to spray him with some water

Lex Fridman (1:10:22.860)

and put him out of his misery?

Robert Breedlove (1:10:26.460)

I would say that pain is the inarguable basis of being.

Lex Fridman (1:10:34.380)

Pain is, no matter how you try to explain it away

Robert Breedlove (1:10:39.820)

or describe it,

Lex Fridman (1:10:41.340)

or it's not something you can rationalize away.

Robert Breedlove (1:10:46.980)

No one, I think ever,

Lex Fridman (1:10:50.900)

someone may want to cut themselves to have an endorphin high

Lex Fridman (1:10:53.180)

but no one wants to suffer, we'd say, right?

Lex Fridman (1:10:55.060)

So pain in that sense,

Robert Breedlove (1:10:56.980)

it is what we're constantly trying to deal with

Lex Fridman (1:11:00.500)

and to move away from or create buffers between us

Lex Fridman (1:11:04.780)

and potential pain or potential uncertainty.

Lex Fridman (1:11:07.620)

And that pain is information.

Robert Breedlove (1:11:10.900)

When we experience something

Lex Fridman (1:11:12.500)

that is misfit to the outcome we desired,

Robert Breedlove (1:11:16.100)

that pain is what puts us,

Lex Fridman (1:11:17.820)

it encourages us to change our trajectory

Robert Breedlove (1:11:20.820)

to get back on course towards our valued aim.

Lex Fridman (1:11:24.060)

So as far as, you need entrepreneurs that are exploring,

Lex Fridman (1:11:31.020)

and you're trying to do something new,

Lex Fridman (1:11:32.340)

if you're a pioneer of any kind,

Robert Breedlove (1:11:33.860)

you are courageously facing pain.

Lex Fridman (1:11:36.140)

You're willfully confronting it.

Lex Fridman (1:11:38.060)

So I don't think it's avoidable in that sense.

Lex Fridman (1:11:40.900)

It's not like we can have pain free economic growth

Robert Breedlove (1:11:44.540)

like the central bank would maybe have us lend to believe

Lex Fridman (1:11:48.020)

that we can just run these experiments

Lex Fridman (1:11:50.220)

and when they fail,

Lex Fridman (1:11:51.060)

we'll just paper over all the losses and continue.

Robert Breedlove (1:11:52.900)

Or you're just delaying and exacerbating

Lex Fridman (1:11:56.140)

the inevitable volatility back to reality.

Lex Fridman (1:11:59.660)

But what I would say is that capitalism,

Lex Fridman (1:12:02.660)

because we're building,

Robert Breedlove (1:12:03.820)

we're increasing the capital stock of the world,

Lex Fridman (1:12:05.620)

which again, capital is the mitigation of risk.

Lex Fridman (1:12:08.060)

So we're reducing the overall risk of existence

Lex Fridman (1:12:10.420)

by accumulating more capital in the world.

Lex Fridman (1:12:12.580)

And that's what protects that entrepreneur

Lex Fridman (1:12:14.900)

that's deciding, hey, I saved up a million bucks.

Robert Breedlove (1:12:17.580)

I'm gonna go try this business idea.

Lex Fridman (1:12:20.100)

I'm gonna put all my money on the line.

Lex Fridman (1:12:22.300)

And if he goes up in flames,

Lex Fridman (1:12:24.420)

then his cost of living when he comes back to reality

Lex Fridman (1:12:27.180)

and he's starting over from zero,

Lex Fridman (1:12:28.380)

his cost of living is substantially lower

Robert Breedlove (1:12:31.060)

starting over from zero than it was in the past.

Lex Fridman (1:12:33.700)

So then he would be out in the wilderness on his own.

Lex Fridman (1:12:37.020)

So it's the accumulation of capital stock

Lex Fridman (1:12:40.020)

is the buffer against uncertainty for everyone.

Lex Fridman (1:12:43.300)

And it gives you actually more potential

Lex Fridman (1:12:47.060)

to go out and experiment,

Robert Breedlove (1:12:48.420)

to go out and confront the chaos of nature

Lex Fridman (1:12:51.180)

because you are better healed effectively.

Lex Fridman (1:12:54.980)

So I think we're speaking

Lex Fridman (1:12:58.980)

in sort of idealistic terms about the power of capitals

Lex Fridman (1:13:03.020)

and when it works well.

Lex Fridman (1:13:04.740)

Is there any aspects that you think

Robert Breedlove (1:13:07.020)

that don't work well in a free market

Lex Fridman (1:13:10.500)

in all the basic pragmatic truths

Lex Fridman (1:13:12.460)

that we were talking about?

Lex Fridman (1:13:13.580)

Is there ways it can go wrong?

Lex Fridman (1:13:16.900)

So I would first argue that we have never seen

Lex Fridman (1:13:22.940)

an actual purely free market.

Robert Breedlove (1:13:25.500)

Closest example would be kind of geopolitically

Lex Fridman (1:13:34.580)

we have a free market

Lex Fridman (1:13:35.740)

and that governments are not necessarily governed

Lex Fridman (1:13:41.580)

but they are premised on governing large groups

Robert Breedlove (1:13:46.780)

of individuals.

Lex Fridman (1:13:47.620)

So that's not, doesn't exactly.

Lex Fridman (1:13:49.940)

You mean between governments?

Lex Fridman (1:13:52.100)

Yes.

Robert Breedlove (1:13:53.140)

See, but isn't there still,

Lex Fridman (1:13:54.620)

so a free market, maybe you can correct me,

Robert Breedlove (1:13:57.780)

is the free market still grounded in the ideas

Lex Fridman (1:14:00.460)

of property rights and all those kinds of things, right?

Lex Fridman (1:14:03.980)

So governments tend to also sometimes

Lex Fridman (1:14:06.300)

be violent towards each other.

Robert Breedlove (1:14:07.820)

That's right.

Lex Fridman (1:14:08.660)

So they don't respect all the basic aspects of capitalism.

Robert Breedlove (1:14:11.820)

That's right.

Lex Fridman (1:14:12.660)

So maybe another way to look at this is that

Robert Breedlove (1:14:15.020)

gold is the original governor of government actually.

Lex Fridman (1:14:20.860)

And this is the reason governments have abused

Lex Fridman (1:14:24.140)

and gone off of the gold standard.

Lex Fridman (1:14:26.980)

So historically, if you are a bank or a nation state

Lex Fridman (1:14:33.180)

and you produce more currency

Lex Fridman (1:14:37.820)

than your gold reserves can justify,

Robert Breedlove (1:14:41.020)

then gold will flow out of your bank

Lex Fridman (1:14:43.860)

or out of your country.

Lex Fridman (1:14:45.020)

So there's this natural check via the money

Lex Fridman (1:14:50.020)

that via capitalistic money, which is gold, right?

Robert Breedlove (1:14:53.300)

Gold was selected by the free market.

Lex Fridman (1:14:55.060)

It's not decreed by government.

Robert Breedlove (1:14:57.460)

It provided this natural check on government action.

Lex Fridman (1:15:01.460)

So my, I guess to get back to the original question is

Robert Breedlove (1:15:07.020)

we've never seen a pure free market

Lex Fridman (1:15:10.580)

because money has always been monopolized

Lex Fridman (1:15:15.100)

and coerced, frankly.

Lex Fridman (1:15:16.980)

So to try and answer what goes wrong with a free market

Robert Breedlove (1:15:20.780)

is really difficult because we've never actually seen it.

Lex Fridman (1:15:23.580)

And I would define free market is one

Robert Breedlove (1:15:27.620)

in which government only protects life, liberty and property.

Lex Fridman (1:15:31.580)

And so that has a very minimal role in society.

Robert Breedlove (1:15:35.060)

Again, just as network security

Lex Fridman (1:15:37.340)

for the economic trade network.

Lex Fridman (1:15:39.740)

And anything that, any government function that goes beyond

Lex Fridman (1:15:44.660)

those three core functions, which by the way,

Robert Breedlove (1:15:47.140)

are pretty much the core tenants of morality as well.

Lex Fridman (1:15:49.540)

So government's just really intended to preserve,

Robert Breedlove (1:15:52.340)

you know, natural law, if you will.

Lex Fridman (1:15:55.060)

Anything that goes beyond that is,

Robert Breedlove (1:15:58.060)

moves us closer to an unfree market.

Lex Fridman (1:16:00.580)

So every regulation, every act of coercion

Robert Breedlove (1:16:05.100)

is actually a gradation closer to a purely unfree market,

Lex Fridman (1:16:10.540)

which would be a monopoly.

Lex Fridman (1:16:12.260)

So in terms of what I guess theoretically we could say

Lex Fridman (1:16:15.980)

goes wrong in the free market is that it's volatile.

Robert Breedlove (1:16:20.220)

It's trading off, it's accepting short term volatility

Lex Fridman (1:16:26.500)

in exchange for less long run volatility.

Lex Fridman (1:16:29.820)

And this tends to be the way of nature, by the way.

Lex Fridman (1:16:32.300)

So if we look at something like there's a region

Robert Breedlove (1:16:37.300)

in North America called Baja, California,

Lex Fridman (1:16:40.300)

and it runs into the United States

Lex Fridman (1:16:43.660)

and it runs down into Mexico as well.

Lex Fridman (1:16:45.420)

So the same topology, but two different jurisdictions.

Robert Breedlove (1:16:50.340)

In the US, we very heavily manage forest fires.

Lex Fridman (1:16:55.580)

We're trying to manage nature effectively.

Robert Breedlove (1:16:57.900)

Whereas in Mexico is much more unregulated.

Lex Fridman (1:16:59.980)

It just, when wildfires spring up, they let them burn off.

Robert Breedlove (1:17:04.260)

North America, when wildfires spring up,

Lex Fridman (1:17:06.220)

we're actually extinguishing them.

Lex Fridman (1:17:08.140)

So we're constantly trying to dampen

Lex Fridman (1:17:09.660)

the short run volatility of these small brush fires.

Robert Breedlove (1:17:12.260)

Whereas in Mexico, we just let them burn.

Lex Fridman (1:17:13.660)

We let nature do its thing.

Robert Breedlove (1:17:15.500)

The consequence of this is that the wildfires

Lex Fridman (1:17:18.860)

still occur eventually, but they're much larger

Lex Fridman (1:17:21.260)

and much more devastating in North America

Lex Fridman (1:17:23.140)

where human intervention has occurred

Robert Breedlove (1:17:25.180)

because it's dampening nature's natural corrective mechanism

Lex Fridman (1:17:31.820)

of clearing this underbrush with these more frequent

Lex Fridman (1:17:34.620)

and smaller fires at the cost of much larger fires.

Lex Fridman (1:17:38.020)

So again, we're delaying short term volatility

Lex Fridman (1:17:39.860)

and exacerbating long run volatility.

Lex Fridman (1:17:42.580)

And in Mexico, it's the opposite, right?

Robert Breedlove (1:17:44.340)

Just these wildfires burn much smaller

Lex Fridman (1:17:46.500)

and more continuously over time.

Robert Breedlove (1:17:49.340)

The further effect of that in North America

Lex Fridman (1:17:51.020)

is that the fires can get so big and so hot

Robert Breedlove (1:17:53.180)

that it burns away the top soil.

Lex Fridman (1:17:55.100)

So it actually destroys the fertility of the soil itself.

Lex Fridman (1:17:58.460)

So the point of this is that human intervention, right?

Lex Fridman (1:18:02.940)

Even the intention behind North American authorities

Robert Breedlove (1:18:06.540)

managing that forest fire is to create less destruction.

Lex Fridman (1:18:10.260)

That is the intention,

Lex Fridman (1:18:11.940)

but the intention is divergent from the outcome.

Lex Fridman (1:18:15.300)

So in Taliban speak, he would say that human intervention

Robert Breedlove (1:18:18.900)

moves us from mediocre stan into extremist stan.

Lex Fridman (1:18:23.980)

So mediocre stan would be something much more like nature

Robert Breedlove (1:18:27.340)

where for instance, you can't double your body weight

Lex Fridman (1:18:30.140)

in a day, probably can't even do it in a year, right?

Lex Fridman (1:18:33.700)

But in extremist stan,

Lex Fridman (1:18:34.740)

which is something much more information based,

Robert Breedlove (1:18:37.140)

you can double or send your net worth to zero

Lex Fridman (1:18:41.900)

in a single trade in a single moment, right?

Lex Fridman (1:18:44.740)

So when we try and intervene

Lex Fridman (1:18:46.700)

with natural biological systems

Robert Breedlove (1:18:48.620)

that have these feedback loops,

Lex Fridman (1:18:51.740)

we actually start to push the system more

Robert Breedlove (1:18:53.820)

to behave more like an extremist stan system

Lex Fridman (1:18:57.340)

that has less short run volatility,

Lex Fridman (1:18:59.900)

but more extreme long run volatility.

Lex Fridman (1:19:03.260)

So, but the question is,

Robert Breedlove (1:19:04.820)

where you look at capitalism or communism, for example,

Lex Fridman (1:19:09.340)

and by the way, yes,

Robert Breedlove (1:19:10.580)

I will talk to somebody who's a Marxist or a communist,

Lex Fridman (1:19:13.180)

like Richard Wolff is a pretty eloquent defender

Robert Breedlove (1:19:15.700)

of these ideas because it's always good

Lex Fridman (1:19:18.300)

to really understand ideas

Robert Breedlove (1:19:19.980)

as opposed to just reject them offhand.

Lex Fridman (1:19:24.100)

When you look at the system of capitalism

Robert Breedlove (1:19:26.300)

or the system of communism,

Lex Fridman (1:19:29.420)

there's ideals and a lot of people argue

Robert Breedlove (1:19:32.140)

in this perfect form would actually be good for the world.

Lex Fridman (1:19:35.780)

The question is how resilient are they

Lex Fridman (1:19:38.620)

to the corruption of human nature?

Lex Fridman (1:19:42.220)

And I mean, you're saying that there's not a,

Robert Breedlove (1:19:45.220)

there's never been a free market.

Lex Fridman (1:19:47.380)

It's a very true statement.

Robert Breedlove (1:19:48.820)

The question is how resilient is capitalism

Lex Fridman (1:19:52.940)

or whatever implementations of capitalism

Robert Breedlove (1:19:54.700)

we had up to this point to human nature

Lex Fridman (1:19:57.340)

where one person will become successful

Robert Breedlove (1:19:59.340)

through legitimate means

Lex Fridman (1:20:03.060)

and starts to try to manipulate the system

Robert Breedlove (1:20:05.940)

that takes it away from a free market

Lex Fridman (1:20:07.580)

or takes it away from the things

Robert Breedlove (1:20:10.940)

that gave them the riches in the first place.

Lex Fridman (1:20:13.900)

And then try to, through corruption, get more,

Robert Breedlove (1:20:17.220)

get this, the thing you said, the lazy human ways.

Lex Fridman (1:20:20.780)

Now try to figure out how to get something for nothing.

Robert Breedlove (1:20:22.980)

That's right.

Lex Fridman (1:20:24.220)

So how resilient do you think is capitalism to that?

Robert Breedlove (1:20:26.820)

Well, the best implementation we've had of it

Lex Fridman (1:20:31.460)

really has been the United States, I think,

Robert Breedlove (1:20:35.700)

up until this point.

Lex Fridman (1:20:36.620)

But it's still the central banking itself.

Robert Breedlove (1:20:42.420)

This was in the 1848 Manifesto to the Communist Party.

Lex Fridman (1:20:45.820)

Measure number five reads an exclusive state monopoly

Lex Fridman (1:20:49.740)

and centralized control over cash and credit.

Lex Fridman (1:20:51.860)

So the central bank is a Marxist or communist institution.

Robert Breedlove (1:20:56.620)

It is antithetical to the free market principles

Lex Fridman (1:20:58.740)

on which the United States was founded.

Lex Fridman (1:21:00.460)

And indeed, the United States resisted

Lex Fridman (1:21:02.060)

the implementation of a central bank.

Robert Breedlove (1:21:04.460)

I think it was Andrew Jackson.

Lex Fridman (1:21:06.500)

I know there was the first national bank,

Robert Breedlove (1:21:08.420)

the second national bank were both disbanded.

Lex Fridman (1:21:10.820)

And then Andrew Jackson, which is my favorite Tennessean,

Robert Breedlove (1:21:14.060)

he has some famous quotes about routing out the bankers

Lex Fridman (1:21:18.180)

like a den of vipers.

Robert Breedlove (1:21:19.700)

I think he punched one of the central bankers in the face.

Lex Fridman (1:21:23.060)

Back when our leaders were a bit more badass,

Robert Breedlove (1:21:26.980)

I guess you might say.

Lex Fridman (1:21:28.820)

And finally in 1913, the Federal Reserve was implemented.

Lex Fridman (1:21:35.380)

And it's been kind of all downhill from there.

Lex Fridman (1:21:39.460)

So what is, can you, oh, sorry, go ahead.

Robert Breedlove (1:21:41.940)

I was just gonna say that communism and capitalism,

Lex Fridman (1:21:45.620)

it's also a matter of scale.

Robert Breedlove (1:21:48.660)

The ideal behind communism is from each

Lex Fridman (1:21:51.500)

according to their ability to each according to their need.

Lex Fridman (1:21:54.100)

Sounds beautiful, right?

Lex Fridman (1:21:55.420)

Sounds like a great, peaceful, harmonious way

Robert Breedlove (1:21:58.380)

to organize ourselves.

Lex Fridman (1:22:00.020)

The problem is, and by the way, I am a communist

Lex Fridman (1:22:03.700)

in my family, in my home, right?

Lex Fridman (1:22:05.500)

At that very smallest of scales.

Robert Breedlove (1:22:07.140)

Yes, in your very small circles of trust,

Lex Fridman (1:22:10.220)

you're much more likely to behave selflessly

Robert Breedlove (1:22:13.940)

towards one another.

Lex Fridman (1:22:14.780)

By the way, I look forward to the Bitcoin community

Robert Breedlove (1:22:17.260)

clipping out that part, saying that Robert Breedlove

Lex Fridman (1:22:20.900)

was a communist and the ideals of communism are beautiful.

Robert Breedlove (1:22:23.980)

Yeah, context matters, people.

Lex Fridman (1:22:25.580)

Sorry, go ahead.

Lex Fridman (1:22:29.420)

But to your point, it does not scale, right?

Lex Fridman (1:22:33.100)

As we move into this larger system

Robert Breedlove (1:22:37.900)

of socioeconomic cooperation, which is necessary

Lex Fridman (1:22:41.580)

to deepen the division of labor, to generate more wealth.

Robert Breedlove (1:22:44.940)

We need to interact with one another on much larger scales

Lex Fridman (1:22:48.540)

than this communistic utopian ideal.

Robert Breedlove (1:22:52.220)

We get into the realm of capitalism

Lex Fridman (1:22:54.340)

where we need really sound rules, hard rules,

Robert Breedlove (1:22:58.020)

consensus, verifiability, and frankly, prices.

Lex Fridman (1:23:03.620)

Because the other thing in Soviet Russia

Robert Breedlove (1:23:06.340)

is they tried to replace the profit motive

Lex Fridman (1:23:08.780)

or the price signal with this devotion to,

Robert Breedlove (1:23:13.140)

this nationalistic faith and devotion.

Lex Fridman (1:23:15.420)

Where it's like, you don't need self interest anymore.

Robert Breedlove (1:23:18.340)

You don't need prices or profits.

Lex Fridman (1:23:20.300)

You can just protect Mother Russia, right?

Lex Fridman (1:23:23.220)

And serve Mother Russia and that would create wealth.

Lex Fridman (1:23:26.420)

And what happened, right?

Robert Breedlove (1:23:28.060)

They destroyed price signals.

Lex Fridman (1:23:29.780)

There were shortages, there were famines,

Robert Breedlove (1:23:32.180)

there's all levels of corruption.

Lex Fridman (1:23:35.980)

Because to your point, it's once you,

Robert Breedlove (1:23:39.860)

people have to run the system no matter what.

Lex Fridman (1:23:42.500)

So when people are always pursuing something for nothing

Lex Fridman (1:23:45.420)

and you put someone in a seat

Lex Fridman (1:23:46.700)

of much closer to absolute power

Robert Breedlove (1:23:49.260)

where they're making all the pricing decisions,

Lex Fridman (1:23:51.420)

they own all of the productive factors in the economy,

Robert Breedlove (1:23:54.820)

they're not beholden to any market force.

Lex Fridman (1:23:57.780)

There's no market check on their action

Robert Breedlove (1:24:01.700)

that that institution tends to become more corrupt.

Lex Fridman (1:24:04.820)

And further, it's an inferior resource strategy.

Robert Breedlove (1:24:10.700)

I alluded to this earlier where the other way

Lex Fridman (1:24:12.860)

to think about free market versus central planning is

Robert Breedlove (1:24:17.340)

it's decentralized or distributed computing

Lex Fridman (1:24:20.460)

versus centralized computing.

Lex Fridman (1:24:22.820)

So each one of us, I think that the number

Lex Fridman (1:24:26.180)

is 120 bits per second of active awareness.

Lex Fridman (1:24:29.460)

And so we can take in, clearly we process a lot more

Lex Fridman (1:24:32.060)

than that, but our active awareness,

Robert Breedlove (1:24:33.180)

I think is 120 bits per second.

Lex Fridman (1:24:37.540)

In a centralized planning body like in Soviet Russia,

Robert Breedlove (1:24:40.700)

they had the pricing czar.

Lex Fridman (1:24:41.900)

Maybe they had 10, 20,000 people deciding the prices

Robert Breedlove (1:24:44.740)

for the entire country.

Lex Fridman (1:24:46.100)

You're only getting that much data throughput, right?

Robert Breedlove (1:24:48.980)

20,000 people times 120 bits per second.

Lex Fridman (1:24:52.340)

Whereas in a free market, if everyone is free to interact

Robert Breedlove (1:24:56.140)

with deep capital markets based on an accurate price,

Lex Fridman (1:24:59.060)

you're getting the data throughput of 120 bits per second

Lex Fridman (1:25:02.060)

times the entire economy, right?

Lex Fridman (1:25:04.460)

So you're getting, it's a more efficient means

Robert Breedlove (1:25:08.820)

for disseminating knowledge effectively.

Lex Fridman (1:25:11.780)

And then again, knowledge is just,

Robert Breedlove (1:25:14.020)

the more knowledge a socioeconomic structure can contain,

Lex Fridman (1:25:17.300)

the more wealthy it is, right?

Robert Breedlove (1:25:19.180)

Prices, tools, all these things are just knowledge.

Lex Fridman (1:25:21.780)

So in that respect, that's why something like capitalism,

Robert Breedlove (1:25:27.100)

even in its marginalized form, state capitalism,

Lex Fridman (1:25:30.740)

out competes communism.

Robert Breedlove (1:25:33.100)

It's distributed computing versus centralized computing.

Lex Fridman (1:25:36.420)

You know, we kind of brought up religion

Lex Fridman (1:25:40.620)

and Joseph Campbell and myth and the propagation of ideas.

Lex Fridman (1:25:46.100)

And kind of before I forget,

Robert Breedlove (1:25:48.020)

I wanted to ask your thoughts about this.

Lex Fridman (1:25:50.580)

You know, Jordan Peterson, I haven't really understood

Robert Breedlove (1:25:55.060)

exactly like be able to pin him down exactly

Lex Fridman (1:25:58.580)

what he sees as the role of religion in human society.

Lex Fridman (1:26:03.580)

But it feels like he's describing it as having value for us.

Lex Fridman (1:26:12.140)

The ideas of myth are valuable.

Robert Breedlove (1:26:15.300)

They're valuable mechanisms toward,

Lex Fridman (1:26:18.460)

I think you mentioned kind of directing us

Robert Breedlove (1:26:21.340)

in this world as a human society.

Lex Fridman (1:26:25.020)

Do you think about myth?

Lex Fridman (1:26:26.060)

Do you think about religion?

Lex Fridman (1:26:27.460)

What's the use of it in this construct of markets

Robert Breedlove (1:26:31.820)

in this framework of where ideas are ultimately

Lex Fridman (1:26:37.940)

the fundamental thing that makes societies work?

Robert Breedlove (1:26:44.540)

Yeah, I think Jordan Peterson, who I'm a huge fan of,

Lex Fridman (1:26:49.780)

he's been very influential in my thinking

Lex Fridman (1:26:52.740)

and influential on my own religious views as well.

Lex Fridman (1:26:56.180)

I think his position would be, and he's said this before,

Robert Breedlove (1:27:00.180)

that he acts as if God exists.

Lex Fridman (1:27:05.220)

And I've had some arguments about this before,

Lex Fridman (1:27:08.460)

but to me that points towards the preeminence of action

Lex Fridman (1:27:12.660)

and how important action is

Robert Breedlove (1:27:14.180)

versus your cognitive beliefs necessarily.

Lex Fridman (1:27:19.100)

And I think there is a lot of utility in that,

Robert Breedlove (1:27:20.820)

that if you follow the moral code of something,

Lex Fridman (1:27:24.380)

like the Bible, you do reap benefits from that.

Robert Breedlove (1:27:28.420)

Society reaps benefits from that.

Lex Fridman (1:27:32.700)

And sometimes I bring up this point and people are like,

Lex Fridman (1:27:35.460)

oh my God, are you kidding me?

Lex Fridman (1:27:36.300)

Have you read the Old Testament?

Robert Breedlove (1:27:37.620)

They're clobbering people with rocks

Lex Fridman (1:27:39.540)

when they do the wrong thing.

Robert Breedlove (1:27:41.500)

The Bible doesn't claim to be this,

Lex Fridman (1:27:44.580)

like do everything that was done in the Bible.

Robert Breedlove (1:27:46.500)

It's more like charting this moral progression

Lex Fridman (1:27:48.940)

where we came from this very barbaric society

Robert Breedlove (1:27:51.620)

into something more like the New Testament

Lex Fridman (1:27:54.220)

where we're honoring individual sovereignty

Robert Breedlove (1:27:56.820)

above the state and things like that.

Lex Fridman (1:27:58.220)

So I think that mythology itself

Robert Breedlove (1:28:02.980)

is another form of data compression.

Lex Fridman (1:28:05.580)

If you look at these stories,

Robert Breedlove (1:28:08.100)

Cain and Abel is a good example,

Lex Fridman (1:28:10.020)

or Peterson makes the point that it's a tiny story.

Robert Breedlove (1:28:13.020)

It's a paragraph ish long,

Lex Fridman (1:28:16.020)

but it contains so many layers of meaning

Robert Breedlove (1:28:18.620)

in regards to violence, to evil, betrayal, work,

Lex Fridman (1:28:24.620)

the divergence between intention and result,

Robert Breedlove (1:28:27.220)

because I think Cain is actually making,

Lex Fridman (1:28:31.180)

he's making the effort to sacrifice for God,

Lex Fridman (1:28:34.420)

but the sacrifices he's making are not,

Lex Fridman (1:28:36.700)

God doesn't find them useful.

Lex Fridman (1:28:39.180)

And so he sort of rejects them.

Lex Fridman (1:28:45.220)

Again, if we're organizing these stories

Lex Fridman (1:28:48.260)

we're organized by these useful fictions, right?

Lex Fridman (1:28:50.500)

These, these Herarian imagined orders.

Robert Breedlove (1:28:53.420)

I think mythology is kind of the original version of that,

Lex Fridman (1:28:56.820)

where we were learning to organize ourselves around stories

Robert Breedlove (1:29:03.340)

to best coordinate our action across space and time.

Lex Fridman (1:29:09.140)

And so I think it's very foundational.

Lex Fridman (1:29:14.220)

And back to what we were saying in the beginning

Lex Fridman (1:29:16.180)

that if value truly is fundamental,

Robert Breedlove (1:29:18.420)

I think it's interesting that all these stories

Lex Fridman (1:29:20.900)

point towards often common moral values.

Robert Breedlove (1:29:24.620)

They're not perfectly aligned,

Lex Fridman (1:29:27.700)

but it does speak to just the evolutionary importance

Robert Breedlove (1:29:32.220)

of morality and the subjectivity of morality,

Lex Fridman (1:29:34.620)

where morality sort of evolves over time based on,

Robert Breedlove (1:29:39.100)

frankly, the capital stock we've accumulated.

Lex Fridman (1:29:40.900)

The more capital stock we've accumulated,

Robert Breedlove (1:29:42.580)

the easier life is, the less barbaric we have to be.

Lex Fridman (1:29:45.700)

Whereas if we're living in conditions of true scarcity,

Robert Breedlove (1:29:51.140)

then we tend to be a bit more barbaric towards one another.

Lex Fridman (1:29:55.300)

And that too, to dovetail this

Robert Breedlove (1:29:57.180)

into something largely unrelated,

Lex Fridman (1:29:59.380)

but I think is really important is inflation.

Robert Breedlove (1:30:03.100)

Inflation by artificially increasing the prices

Lex Fridman (1:30:07.380)

of goods and services in the world, right?

Robert Breedlove (1:30:09.620)

We're injecting more dollars,

Lex Fridman (1:30:12.060)

chasing the same level of goods and services.

Robert Breedlove (1:30:15.020)

We are artificially increasing scarcity,

Lex Fridman (1:30:19.460)

perceived scarcity, right?

Lex Fridman (1:30:21.700)

And when you increase perceived scarcity,

Lex Fridman (1:30:24.780)

you are amplifying divisiveness.

Robert Breedlove (1:30:30.060)

The natural state of man is when everything is scarce

Lex Fridman (1:30:33.300)

and you really have to fight hard

Robert Breedlove (1:30:34.700)

just to eat or drink water that day.

Lex Fridman (1:30:37.580)

So it's decivilizing in a way

Robert Breedlove (1:30:40.540)

by artificially amplifying

Lex Fridman (1:30:42.540)

the perceived scarcity in the world.

Lex Fridman (1:30:44.780)

Can you elaborate how does inflation increase

Lex Fridman (1:30:47.340)

the perceived scarcity in the world?

Lex Fridman (1:30:49.220)

So we could think the price itself is an indication,

Lex Fridman (1:30:52.980)

it's a data packet, if you will.

Lex Fridman (1:30:54.620)

The price is a data packet on supply and demand, right?

Lex Fridman (1:30:57.820)

It's telling you how much supply there is

Robert Breedlove (1:31:00.460)

of something in the world relative to the demand.

Lex Fridman (1:31:03.540)

So when you print money

Lex Fridman (1:31:06.460)

and artificially increase that price,

Lex Fridman (1:31:08.620)

it's diverging away from supply and demand.

Robert Breedlove (1:31:10.820)

It's becoming just more of a product of policy

Lex Fridman (1:31:13.820)

than it is of free market fundamentals.

Robert Breedlove (1:31:17.900)

The more expensive something is,

Lex Fridman (1:31:19.980)

that is a signal to the marketplace and to market actors

Lex Fridman (1:31:22.860)

that it is scarce, right?

Lex Fridman (1:31:24.700)

That's why a Leonardo painting

Robert Breedlove (1:31:28.340)

might sell for $16 million, there's only one,

Lex Fridman (1:31:30.780)

there's a lot of demand for it.

Robert Breedlove (1:31:32.940)

Maybe my numbers are off, but you get the point.

Lex Fridman (1:31:36.020)

It's the reason mask spiked in price

Lex Fridman (1:31:38.420)

after the COVID announcement, right?

Lex Fridman (1:31:39.940)

There was not enough supply,

Robert Breedlove (1:31:41.900)

toilet paper, et cetera, et cetera.

Lex Fridman (1:31:43.660)

So inflation, and by inflation,

Robert Breedlove (1:31:47.700)

I specifically mean arbitrary fiat currency

Lex Fridman (1:31:50.900)

supply inflation by legal monopoly,

Robert Breedlove (1:31:53.900)

not inflation is a commonly misunderstood word.

Lex Fridman (1:31:57.340)

That is amplifying the perception of scarcity

Robert Breedlove (1:32:01.380)

among market actors in the world.

Lex Fridman (1:32:03.580)

And I would argue that it actually amplifies divisiveness.

Robert Breedlove (1:32:07.860)

I think this is the key maybe to looking at

Lex Fridman (1:32:12.060)

the connection between the monopolization of money

Lex Fridman (1:32:15.140)

and things like cancel culture,

Lex Fridman (1:32:17.180)

because it's increasing our natural predilection

Robert Breedlove (1:32:22.820)

to be combative with one another,

Lex Fridman (1:32:24.340)

because we think there's more scarcity in the world

Robert Breedlove (1:32:26.740)

than there actually is,

Lex Fridman (1:32:27.980)

versus in a world where you're not increasing

Robert Breedlove (1:32:29.900)

the money supply, prices are declining every year.

Lex Fridman (1:32:33.220)

As prices decline, this is a signal to market actors

Lex Fridman (1:32:36.460)

and the market that scarcity is declining.

Lex Fridman (1:32:39.020)

There's less need to fight over things.

Lex Fridman (1:32:41.940)

And all of this ties back into the old Bastiat saying

Lex Fridman (1:32:46.180)

that if goods don't cross borders, soldiers will.

Lex Fridman (1:32:50.300)

So if we're not trading with one another,

Lex Fridman (1:32:52.020)

if we're not acting interdependently,

Lex Fridman (1:32:53.940)

and we're not becoming more intelligent as a market,

Lex Fridman (1:33:00.140)

and that increased intelligence or increased knowledge

Robert Breedlove (1:33:03.820)

is reflected in decreased prices,

Lex Fridman (1:33:06.620)

because prices are just the exchange ratios of things.

Lex Fridman (1:33:11.020)

So the smarter we can solve problems,

Lex Fridman (1:33:12.980)

the better we can solve problems, the less prices would be.

Lex Fridman (1:33:15.900)

So it induces more cooperation.

Lex Fridman (1:33:18.820)

I love how you tie inflation and cancel culture together

Robert Breedlove (1:33:21.660)

as essentially artificial creation of increase of conflict.

Lex Fridman (1:33:28.380)

Artificially increasing scarcity

Lex Fridman (1:33:30.420)

and thereby artificially increasing conflict.

Lex Fridman (1:33:33.300)

That's really fascinating.

Robert Breedlove (1:33:35.820)

You're short circuiting my brain

Lex Fridman (1:33:38.460)

many times throughout this conversation.

Robert Breedlove (1:33:40.500)

Okay, this robot is struggling to keep up.

Lex Fridman (1:33:45.340)

Okay, maybe to step back at the useful fictions

Robert Breedlove (1:33:50.860)

or pragmatic truths.

Lex Fridman (1:33:53.860)

Let me ask the question that you've answered

Robert Breedlove (1:33:56.180)

in many ways already, but let's explicitly look at.

Lex Fridman (1:34:00.260)

What is money?

Robert Breedlove (1:34:01.900)

Oh, as you know, that's my favorite question.

Lex Fridman (1:34:04.060)

Yes.

Robert Breedlove (1:34:07.500)

Is the name of the show I just launched,

Lex Fridman (1:34:09.940)

the What is Money show?

Robert Breedlove (1:34:13.420)

Clearly, we could say that the Bitcoin rabbit hole

Lex Fridman (1:34:16.980)

is what's led me to explore a lot of these ideas in depth.

Lex Fridman (1:34:22.180)

And I think as we've demonstrated today,

Lex Fridman (1:34:23.860)

it goes well beyond just the economic sphere

Robert Breedlove (1:34:26.660)

when you start to think about things like exchange

Lex Fridman (1:34:28.780)

and morality and time preference and civilization.

Lex Fridman (1:34:33.140)

So I love the question, what is money?

Lex Fridman (1:34:35.980)

I think it is the key to incepting a deeper understanding

Robert Breedlove (1:34:40.340)

of the world into people that if you actually

Lex Fridman (1:34:42.260)

just start to ask the seemingly simple question,

Robert Breedlove (1:34:47.220)

it surfaces more and more layers of truth.

Lex Fridman (1:34:51.420)

And I recently, I just wrote a piece,

Robert Breedlove (1:34:55.820)

I think I have 30 something answers to this question.

Lex Fridman (1:34:59.780)

So there's.

Lex Fridman (1:35:00.620)

So sometimes it's actually a more systematic way

Lex Fridman (1:35:03.340)

of asking the question of what is the meaning of life?

Robert Breedlove (1:35:06.540)

There's some questions that are almost unanswerable,

Lex Fridman (1:35:11.180)

but in their asking allow you to deeply get closer to truth,

Robert Breedlove (1:35:17.540)

deeply understand the nature of our human existence.

Lex Fridman (1:35:21.420)

And the meaning of life is almost like

Robert Breedlove (1:35:23.020)

this initial philosophers striving towards that.

Lex Fridman (1:35:28.020)

If money is indeed as fundamental as you've described,

Robert Breedlove (1:35:34.540)

especially in the context of value being fundamental,

Lex Fridman (1:35:38.140)

then that is a really, that's a more,

Robert Breedlove (1:35:40.380)

let's take a 21st century way of asking the same question

Lex Fridman (1:35:43.140)

about what is the meaning of life.

Robert Breedlove (1:35:45.060)

You mentioned that it's a meta property

Lex Fridman (1:35:47.740)

out of the list of many ways to answer that question.

Lex Fridman (1:35:51.080)

How would you help people to think about that?

Lex Fridman (1:35:53.260)

Yeah, the first most serious answer

Robert Breedlove (1:35:58.620)

comes from the school of Austrian economics

Lex Fridman (1:36:01.440)

and it defines money as a universal medium of exchange.

Lex Fridman (1:36:06.500)

So this would be any good that is used,

Lex Fridman (1:36:12.540)

held and used purely for purposes of facilitating exchange.

Lex Fridman (1:36:17.540)

So in the configuration of demand for any particular asset,

Lex Fridman (1:36:23.860)

it's bifurcated between its utility,

Robert Breedlove (1:36:26.780)

which is something a service

Lex Fridman (1:36:28.220)

that it can render to you in real time,

Robert Breedlove (1:36:31.020)

whether it's, if it's water, you're thirsty,

Lex Fridman (1:36:35.060)

that's the utility of water is that it can quench your thirst

Robert Breedlove (1:36:39.080)

whereas the marketability would be the expectation

Lex Fridman (1:36:41.900)

of future exchange that other people would want this asset

Robert Breedlove (1:36:44.980)

in the future to trade it for whatever they may have.

Lex Fridman (1:36:49.180)

Money is just going to be the good in any trading economy

Robert Breedlove (1:36:53.660)

that has the highest proportion of marketability

Lex Fridman (1:36:56.020)

relative to utility.

Lex Fridman (1:36:57.900)

So today that would be gold.

Lex Fridman (1:37:00.580)

Gold has utility, it's used in electronics,

Robert Breedlove (1:37:03.460)

it's used in dental dentistry and whatnot,

Lex Fridman (1:37:06.540)

but it's largely used as a store of value across time

Lex Fridman (1:37:09.920)

and that's what it's been used for for 5,000 years.

Lex Fridman (1:37:12.200)

So if we say gold has a $10 trillion market cap,

Robert Breedlove (1:37:16.700)

maybe 2 trillion of that is its utility value

Lex Fridman (1:37:19.380)

or it's actually demand for use in computers and dentistry

Lex Fridman (1:37:22.620)

and an 8 trillion of that is demand

Lex Fridman (1:37:24.500)

for its use as a store of value.

Robert Breedlove (1:37:28.500)

Money, the marketability aspects of money

Lex Fridman (1:37:32.540)

boils down to five services that money can render.

Robert Breedlove (1:37:36.780)

Money needs to be divisible, it needs to be durable,

Lex Fridman (1:37:40.340)

it needs to be recognizable, it needs to be portable

Lex Fridman (1:37:42.820)

and it needs to be scarce.

Lex Fridman (1:37:45.640)

So I'll gloss over a lot of history with this

Lex Fridman (1:37:47.240)

and just say that historically,

Lex Fridman (1:37:50.040)

money's always been a technology,

Robert Breedlove (1:37:51.920)

still is a technology or a tool.

Lex Fridman (1:37:53.700)

I use these terms interchangeably

Lex Fridman (1:37:55.180)

and you think of a technology

Lex Fridman (1:37:56.780)

as just a more sophisticated tool effectively.

Robert Breedlove (1:38:02.620)

To best satisfy those properties,

Lex Fridman (1:38:03.980)

monetary metals were determined

Robert Breedlove (1:38:05.620)

to be the most satisfactory tool,

Lex Fridman (1:38:08.340)

the most divisible, most durable, most recognizable,

Robert Breedlove (1:38:10.060)

most portable tool in the marketplace.

Lex Fridman (1:38:13.180)

Of the monetary metals, gold was the most scarce

Robert Breedlove (1:38:17.060)

as quantified by either its stock to flow ratio

Lex Fridman (1:38:20.620)

or its inflation resistance.

Lex Fridman (1:38:22.280)

So simple way to say this is that people always prefer

Lex Fridman (1:38:25.580)

the money most resistant to inflation.

Robert Breedlove (1:38:27.980)

That's a nice definition of scarcity in the context.

Lex Fridman (1:38:30.780)

The money is, if you were to measure it,

Robert Breedlove (1:38:34.020)

the resistance to inflation.

Lex Fridman (1:38:36.180)

So how hard is it to artificially increase

Lex Fridman (1:38:38.340)

the supply of the thing?

Lex Fridman (1:38:39.980)

That is the hardness of money.

Lex Fridman (1:38:41.860)

And that's why gold is hard money.

Lex Fridman (1:38:43.420)

Because the alchemy is hard.

Robert Breedlove (1:38:44.900)

That's right.

Lex Fridman (1:38:46.140)

Because no one cracked the alchemy.

Lex Fridman (1:38:47.300)

So gold became money.

Lex Fridman (1:38:49.820)

So that's such a nice clean explanation of what is money

Robert Breedlove (1:38:56.180)

with the five elements and gold ultimately won out

Lex Fridman (1:38:59.340)

because of the last piece of scarcity.

Robert Breedlove (1:39:01.740)

That's right.

Lex Fridman (1:39:02.580)

And to get to maybe dig a little deeper there.

Lex Fridman (1:39:04.660)

So scarcity, we commonly think of scarcity

Lex Fridman (1:39:08.460)

as strictly a supply property,

Robert Breedlove (1:39:12.460)

where if there's not much of something, then it's scarce.

Lex Fridman (1:39:15.260)

But it's not actually true.

Robert Breedlove (1:39:16.580)

Scarcity occurs when demand exceeds supply.

Lex Fridman (1:39:20.780)

So when there's more demand than the supply can justify,

Robert Breedlove (1:39:24.380)

the thing becomes an economic good

Lex Fridman (1:39:26.300)

and it establishes itself a market price.

Lex Fridman (1:39:30.060)

So there's more demand for the thing

Lex Fridman (1:39:31.560)

than the supply can satisfy.

Robert Breedlove (1:39:33.780)

The unique thing about money as a concept at least

Lex Fridman (1:39:37.060)

is that demand always exceeds supply.

Lex Fridman (1:39:40.780)

There's never enough money to satisfy everyone, right?

Lex Fridman (1:39:43.500)

Because another definition for money,

Robert Breedlove (1:39:46.380)

it's the most marketable good.

Lex Fridman (1:39:48.580)

So it can be traded for any other good service,

Robert Breedlove (1:39:53.080)

piece of knowledge in the marketplace.

Lex Fridman (1:39:55.140)

So humans being what we are, we're never satisfied, right?

Robert Breedlove (1:39:58.220)

We always want more of something, whatever it may be.

Lex Fridman (1:40:01.220)

So money as the ultimate token of obtaining that something

Robert Breedlove (1:40:04.980)

is always scarce as a concept.

Lex Fridman (1:40:09.020)

But the problem with money is that if you can,

Robert Breedlove (1:40:12.580)

as you alluded to, easily increase its supply,

Lex Fridman (1:40:15.500)

then all of a sudden you can compromise

Robert Breedlove (1:40:17.060)

the scarcity of it over time

Lex Fridman (1:40:19.980)

and you can rob people through inflation.

Lex Fridman (1:40:23.220)

So that's why the market settled on gold as money.

Lex Fridman (1:40:26.580)

And robbing is reallocating the value that I,

Lex Fridman (1:40:31.500)

so essentially the one property, like why scarcity

Lex Fridman (1:40:36.580)

is important is it adds a lot more friction

Robert Breedlove (1:40:40.880)

to the reallocation, like through essentially violence

Lex Fridman (1:40:47.460)

or implied violence.

Robert Breedlove (1:40:48.900)

Well, it prevents it through cost of extraction too.

Lex Fridman (1:40:51.380)

So if you want to go out and dilute gold holders today,

Robert Breedlove (1:40:54.460)

you have to go out into the world and mine gold.

Lex Fridman (1:40:57.420)

It's a very expensive process.

Robert Breedlove (1:40:59.720)

That process tends to find equilibrium

Lex Fridman (1:41:02.700)

where production cost equals the market value of gold.

Lex Fridman (1:41:05.180)

So if market value is $2,000 an ounce today of gold,

Lex Fridman (1:41:08.500)

its production cost is going to be around there.

Robert Breedlove (1:41:10.960)

That's the natural market equilibrium.

Lex Fridman (1:41:12.420)

So that way gold miners cannot just dilute people over time.

Robert Breedlove (1:41:16.820)

Whereas if you look at something like fiat currency,

Lex Fridman (1:41:19.700)

which we're jumping ahead a little bit,

Lex Fridman (1:41:21.180)

but its production cost is zero.

Lex Fridman (1:41:23.860)

So there's a reason the market value of fiat currency

Robert Breedlove (1:41:26.540)

historically has always converged to zero

Lex Fridman (1:41:29.500)

because its production cost is near zero.

Lex Fridman (1:41:31.500)

So the extension to that question might be

Lex Fridman (1:41:34.060)

how did we get from gold to paper currency?

Lex Fridman (1:41:37.700)

And again, this is rooted in the properties of money.

Lex Fridman (1:41:41.620)

As good as monetary metals were

Lex Fridman (1:41:43.140)

and as good as gold is as money at holding value across time,

Lex Fridman (1:41:47.660)

it's rather limited in terms of portability.

Robert Breedlove (1:41:50.740)

It is not as useful for moving value across space.

Lex Fridman (1:41:54.100)

This is another definition of money, by the way,

Robert Breedlove (1:41:55.820)

a social device for moving value across space and time.

Lex Fridman (1:42:00.340)

So to rectify this technological shortcoming of gold,

Robert Breedlove (1:42:04.820)

we introduced, first of all,

Lex Fridman (1:42:08.180)

the custody of gold was gradually centralized

Robert Breedlove (1:42:10.900)

into fewer and fewer warehousing operations.

Lex Fridman (1:42:15.580)

This is because there are economies of scale

Robert Breedlove (1:42:17.780)

associated with using gold as money.

Lex Fridman (1:42:20.980)

And that if you centralize the custody,

Robert Breedlove (1:42:23.120)

the warehouse owner can then issue a paper receipt

Lex Fridman (1:42:26.460)

called a warehouse receipt for that gold.

Lex Fridman (1:42:28.540)

And then market participants can trade that paper

Lex Fridman (1:42:31.100)

as if it's good as gold.

Lex Fridman (1:42:32.500)

And everyone has an option at any time

Lex Fridman (1:42:34.160)

to go and redeem real gold from the warehouse.

Lex Fridman (1:42:36.860)

So that system works until the problem with it

Lex Fridman (1:42:40.740)

is that it introduces the need to trust the custodian.

Lex Fridman (1:42:44.120)

So it's introducing counterparty risk

Lex Fridman (1:42:45.820)

in the form of the custodian.

Lex Fridman (1:42:47.660)

And now should that warehouse choose

Lex Fridman (1:42:50.240)

to increase the supply of paper notes to gold

Robert Breedlove (1:42:54.140)

beyond its supply.

Lex Fridman (1:42:55.420)

So if it's got three tons of gold

Lex Fridman (1:42:57.580)

and it issues six tons worth of paper receipts,

Lex Fridman (1:43:00.900)

all of a sudden it's participating in a fraud.

Robert Breedlove (1:43:03.440)

It's basically lying.

Lex Fridman (1:43:04.520)

It's representing that it has more gold

Robert Breedlove (1:43:06.140)

than it actually does.

Lex Fridman (1:43:08.900)

And that is the pathway that we got into banking

Lex Fridman (1:43:12.780)

and central banking,

Lex Fridman (1:43:14.000)

is we needed a convenience mechanism

Robert Breedlove (1:43:16.540)

to rectify the portability shortcomings of gold.

Lex Fridman (1:43:19.460)

We needed to be able to move value across space, right?

Robert Breedlove (1:43:22.180)

Gold was doing a great job at moving value over time,

Lex Fridman (1:43:24.660)

but not space.

Robert Breedlove (1:43:26.020)

Paper currency gave us the ability

Lex Fridman (1:43:27.380)

to move value across space,

Lex Fridman (1:43:29.140)

but it introduced this attack vector

Lex Fridman (1:43:31.560)

for warehouse operators, which became banks,

Robert Breedlove (1:43:34.200)

which became central banks,

Lex Fridman (1:43:36.040)

to modify the supply to suit their own political agendas.

Robert Breedlove (1:43:39.980)

Added the snooze button.

Lex Fridman (1:43:42.380)

That allows you to do a little fraud.

Robert Breedlove (1:43:45.900)

To get something for nothing.

Lex Fridman (1:43:47.300)

Something, just a little bit at first.

Robert Breedlove (1:43:49.140)

Just this one morning, just a little bit.

Lex Fridman (1:43:53.500)

I mean, I don't know if you can speak

Robert Breedlove (1:43:55.020)

to the birth of fiat currency.

Lex Fridman (1:44:00.140)

Is there some interesting characteristics

Lex Fridman (1:44:04.180)

to those early steps that created it?

Lex Fridman (1:44:07.580)

Like, could it have been averted?

Lex Fridman (1:44:09.940)

Or is this the natural progression of governments?

Lex Fridman (1:44:14.940)

You know, what's funny is that central banking

Lex Fridman (1:44:18.240)

was initially designed to be the custodian of gold, right?

Lex Fridman (1:44:22.560)

And so they were going to custody the gold,

Robert Breedlove (1:44:25.640)

issue paper on top of it,

Lex Fridman (1:44:28.800)

and then they would maintain,

Robert Breedlove (1:44:30.560)

you could trust the public stamp effectively.

Lex Fridman (1:44:32.560)

You could trust that the central bank

Robert Breedlove (1:44:33.840)

had as much gold on reserve as they said they had,

Lex Fridman (1:44:36.480)

and they were supposed to be the trustworthy institution.

Lex Fridman (1:44:38.360)

So we went from placing our trust

Lex Fridman (1:44:41.160)

in a free market game theoretic process,

Robert Breedlove (1:44:43.800)

or trusting gold,

Lex Fridman (1:44:45.960)

and we began trusting this institution instead.

Robert Breedlove (1:44:50.880)

This, that institution would not have arisen

Lex Fridman (1:44:54.440)

if the portability of gold was really high.

Robert Breedlove (1:44:58.160)

If we could have somehow sent gold

Lex Fridman (1:45:00.380)

across a telecommunications channel,

Robert Breedlove (1:45:02.320)

there would have been no need for a central bank.

Lex Fridman (1:45:05.080)

Everyone could have custodyed their gold

Robert Breedlove (1:45:07.560)

in any information bearing medium, frankly,

Lex Fridman (1:45:10.760)

and they could beam it around the world at any time.

Lex Fridman (1:45:13.760)

So this whole institution itself

Lex Fridman (1:45:16.920)

is rooted in a technological shortcoming of gold.

Lex Fridman (1:45:21.080)

So I think it's, another way to think about that

Lex Fridman (1:45:24.160)

is maybe had there been all the gold in the world today

Robert Breedlove (1:45:28.600)

fills two Olympic sized swimming pools,

Lex Fridman (1:45:31.000)

all the gold mined throughout all of human history.

Lex Fridman (1:45:32.960)

So there's not a lot, right?

Lex Fridman (1:45:36.000)

What if there had been just like way more?

Robert Breedlove (1:45:38.760)

There'd just been, I don't know,

Lex Fridman (1:45:39.600)

20,000 Olympic swimming pools worth.

Lex Fridman (1:45:41.840)

Portability wouldn't have been as much of an issue, right?

Lex Fridman (1:45:45.280)

We could have, and this is to say,

Robert Breedlove (1:45:46.960)

assuming gold was still the most scarce metal

Lex Fridman (1:45:48.920)

and all these things,

Robert Breedlove (1:45:52.100)

portability would have been less of an issue.

Lex Fridman (1:45:53.440)

We would have had less dependence

Robert Breedlove (1:45:55.960)

or need for a central bank.

Lex Fridman (1:45:57.960)

So I think it's kind of idiosyncratic

Robert Breedlove (1:46:00.200)

in that we just happened to end up here on this planet

Lex Fridman (1:46:03.720)

with a certain amount of gold.

Robert Breedlove (1:46:05.120)

It best satisfied the properties of money.

Lex Fridman (1:46:07.400)

And a certain amount of humans,

Robert Breedlove (1:46:08.920)

a geographic dispersed such that portability

Lex Fridman (1:46:12.120)

had certain properties that you want to achieve

Robert Breedlove (1:46:14.280)

for humans in the geographical space

Lex Fridman (1:46:16.080)

to be able to be a exchange value.

Lex Fridman (1:46:18.720)

It became more of an issue as we globalized, right?

Lex Fridman (1:46:20.920)

As we became more of a global society,

Robert Breedlove (1:46:22.560)

we needed money that could move across space really fast.

Lex Fridman (1:46:26.440)

So we could trade in international capital markets.

Lex Fridman (1:46:29.620)

So that drove the central bank

Lex Fridman (1:46:33.520)

to become the dominant institution of the world.

Lex Fridman (1:46:35.680)

And if you follow the flows of gold throughout history,

Lex Fridman (1:46:39.080)

you know, I've been watching this documentary

Robert Breedlove (1:46:41.200)

on World War I and World War II on Netflix.

Lex Fridman (1:46:43.640)

I think it's called World War II in Color.

Robert Breedlove (1:46:45.840)

Oh yeah, that's really good.

Lex Fridman (1:46:47.680)

So good.

Robert Breedlove (1:46:50.640)

When I say gold has been the governor of governments

Lex Fridman (1:46:53.480)

or gold is geopolitical money,

Robert Breedlove (1:46:55.080)

like it is the base layer operating system,

Lex Fridman (1:46:59.140)

has been the base layer operating system for analog society.

Lex Fridman (1:47:02.120)

So it's always been about who controls the gold,

Lex Fridman (1:47:05.680)

is who makes the rules.

Lex Fridman (1:47:07.760)

And that's, in that context,

Lex Fridman (1:47:11.200)

is why Bitcoin is so interesting

Robert Breedlove (1:47:12.720)

because it is the disruptor to

Lex Fridman (1:47:16.280)

this base level operating system

Robert Breedlove (1:47:18.840)

that's functioned for all of human history.

Lex Fridman (1:47:22.040)

I think this is a good place to ask,

Robert Breedlove (1:47:24.440)

we asked the what is money question.

Lex Fridman (1:47:27.880)

What is Bitcoin?

Lex Fridman (1:47:29.100)

That's a question as complicated as what is money?

Lex Fridman (1:47:35.120)

I think if you get a general understanding of money

Robert Breedlove (1:47:39.160)

from a number of angles,

Lex Fridman (1:47:42.800)

that we could say Bitcoin is the most superior

Robert Breedlove (1:47:47.880)

monetary technology that has ever existed.

Lex Fridman (1:47:51.560)

So one of the most superior implementation

Robert Breedlove (1:47:54.760)

of the ideas of money that you talked about,

Lex Fridman (1:47:56.720)

you talked about money as speech,

Robert Breedlove (1:47:58.320)

you talked about money as an idea,

Lex Fridman (1:48:01.000)

we talked about money as sovereignty.

Robert Breedlove (1:48:04.040)

Yeah.

Lex Fridman (1:48:04.880)

So we're attaching the concept of money, to your point,

Robert Breedlove (1:48:08.160)

to whatever tool best satisfies those properties of money

Lex Fridman (1:48:13.760)

or best renders those services we need for money.

Lex Fridman (1:48:16.840)

And as you said, you're using the word tool

Lex Fridman (1:48:19.320)

and technology interchangeably here.

Robert Breedlove (1:48:20.720)

Yes, yes.

Lex Fridman (1:48:22.300)

And another thing to think about here is that

Robert Breedlove (1:48:24.820)

we think often in terms of goods or services,

Lex Fridman (1:48:28.480)

but actually everything is a service.

Lex Fridman (1:48:31.880)

So it's not the physical properties of this pen

Lex Fridman (1:48:35.520)

that I find valuable,

Robert Breedlove (1:48:36.800)

it's the services that it renders to me,

Lex Fridman (1:48:38.800)

that I want to write a letter,

Robert Breedlove (1:48:40.460)

this serves me by allowing me to lay ink on paper

Lex Fridman (1:48:45.800)

and communicate information.

Lex Fridman (1:48:47.880)

So value, humans attach value as we alluded to earlier,

Lex Fridman (1:48:52.880)

two services, not goods.

Lex Fridman (1:48:55.520)

So the properties or the services that money renders

Lex Fridman (1:48:58.080)

that human beings value are those five properties,

Robert Breedlove (1:49:00.760)

divisibility, durability,

Lex Fridman (1:49:01.920)

recognizability, portability, scarcity.

Robert Breedlove (1:49:05.200)

Metals best satisfied those services historically,

Lex Fridman (1:49:09.280)

but Bitcoin as the most superior monetary technology

Robert Breedlove (1:49:12.280)

in human history, essentially perfects them.

Lex Fridman (1:49:16.640)

It's as close to perfection as we've ever been.

Lex Fridman (1:49:18.400)

So in terms of divisibility,

Lex Fridman (1:49:21.040)

each Bitcoin can be broken down into 100 million subunits

Robert Breedlove (1:49:25.120)

called a satoshi.

Lex Fridman (1:49:29.240)

If that divisibility were ever a problem,

Robert Breedlove (1:49:31.480)

which actually there was a question that came up recently,

Lex Fridman (1:49:35.120)

if you divide the world population

Robert Breedlove (1:49:37.440)

by the total supply of Bitcoin,

Lex Fridman (1:49:38.760)

you end up at like 0.3 Bitcoin per person,

Robert Breedlove (1:49:42.000)

call it 300,000 satoshis per person.

Lex Fridman (1:49:46.060)

What if that was not enough to facilitate economic activity?

Lex Fridman (1:49:50.560)

And the answer to that is Bitcoin can soft fork

Lex Fridman (1:49:53.200)

into further divisibility.

Lex Fridman (1:49:54.560)

So if Bitcoin ate all the money in the world

Lex Fridman (1:49:58.120)

and the average Bitcoin or wealth

Robert Breedlove (1:50:00.480)

will say 300,000 satoshis each,

Lex Fridman (1:50:02.080)

but that wasn't divisible enough maybe to buy coffee

Lex Fridman (1:50:06.160)

and do all these day to day transactions,

Lex Fridman (1:50:07.560)

what would happen?

Robert Breedlove (1:50:08.400)

Well, we would increase its divisibility.

Lex Fridman (1:50:09.800)

So Bitcoin's perfected divisibility,

Robert Breedlove (1:50:12.480)

the divisibility of money,

Lex Fridman (1:50:13.820)

lets us transact across scales, right?

Robert Breedlove (1:50:16.440)

We can buy coffee or we can buy a house.

Lex Fridman (1:50:21.240)

Durability is an interesting one.

Lex Fridman (1:50:23.160)

So clearly something like gold is very durable.

Lex Fridman (1:50:25.400)

It's resistant to degradation over time.

Robert Breedlove (1:50:28.280)

Bitcoin is just pure information,

Lex Fridman (1:50:30.280)

but it's stored in a distributed format.

Lex Fridman (1:50:33.540)

So information stored in a distributed fashion

Lex Fridman (1:50:37.000)

tends to be virtually infinitely durable.

Robert Breedlove (1:50:40.840)

The example I'd like to give here

Lex Fridman (1:50:41.800)

is something like the Bible.

Robert Breedlove (1:50:43.600)

The Bible is just distributed information.

Lex Fridman (1:50:46.100)

It's stored everywhere and nowhere, so to speak.

Lex Fridman (1:50:49.240)

And for that reason, it has outlasted empires.

Lex Fridman (1:50:53.160)

And Bitcoin's similar, right?

Robert Breedlove (1:50:54.360)

You can't make changes to it unilaterally.

Lex Fridman (1:50:57.080)

But to make explicit the ways in which it is not durable

Robert Breedlove (1:51:01.960)

is the fact that it relies on computing infrastructure.

Lex Fridman (1:51:05.440)

Like it needs computers.

Lex Fridman (1:51:08.360)

So if you were to destroy all the computers in the world,

Lex Fridman (1:51:11.160)

it needs mechanisms that store and transfer information.

Lex Fridman (1:51:17.620)

And so you could attack it.

Lex Fridman (1:51:20.100)

I mean, you could attack gold in the same kind of way,

Robert Breedlove (1:51:22.100)

I suppose, through the physics,

Lex Fridman (1:51:23.800)

but it's probably easier to destroy

Robert Breedlove (1:51:26.260)

all the computers in the world

Lex Fridman (1:51:27.380)

than it is to destroy all the gold in the world.

Robert Breedlove (1:51:30.300)

Maybe not, I don't know.

Lex Fridman (1:51:32.340)

Anyway.

Robert Breedlove (1:51:33.660)

Yeah, you're right.

Lex Fridman (1:51:35.660)

Maybe, I'm not sure which one would be harder to destroy.

Robert Breedlove (1:51:38.480)

The other thing is there's a dynamic incentive.

Lex Fridman (1:51:41.900)

So every time you destroy Bitcoin miners,

Robert Breedlove (1:51:44.820)

you're creating incentives for anyone else

Lex Fridman (1:51:46.580)

with access to electricity to mine

Robert Breedlove (1:51:48.900)

because you're making the algorithm easier.

Lex Fridman (1:51:50.700)

Yeah, so the destruction is difficult

Robert Breedlove (1:51:54.100)

because of the decentralized nature of the whole thing.

Lex Fridman (1:51:56.580)

And the difficulty adjustment.

Robert Breedlove (1:51:57.900)

Yeah, so you're gonna have to use nuclear weapons

Lex Fridman (1:52:00.480)

and cover the whole globe, but anyway.

Robert Breedlove (1:52:02.620)

Yeah, and by then,

Lex Fridman (1:52:03.860)

we've got much bigger problems than money, right?

Robert Breedlove (1:52:06.020)

That's right, so okay, so that's durability.

Lex Fridman (1:52:09.660)

So portability, Bitcoin's pure information,

Robert Breedlove (1:52:12.300)

it can move at the speed of light,

Lex Fridman (1:52:13.620)

can't get much faster than that.

Robert Breedlove (1:52:15.900)

Recognizability refers to the ability

Lex Fridman (1:52:19.540)

to verify the veracity of the money or its authenticity.

Lex Fridman (1:52:23.360)

So you can actually, when we used to transact gold,

Lex Fridman (1:52:27.320)

there were time honored techniques for verifying

Robert Breedlove (1:52:30.000)

that it was gold and not gold plated lead, for instance.

Lex Fridman (1:52:32.980)

This is where we get the term sound money.

Robert Breedlove (1:52:34.860)

A gold coin made a very particular sound

Lex Fridman (1:52:36.760)

when dropped from a certain height.

Robert Breedlove (1:52:38.620)

You've seen people biting coins.

Lex Fridman (1:52:40.220)

These are all techniques for testing the authenticity of gold.

Lex Fridman (1:52:44.100)

And with Bitcoin, we have something unique

Lex Fridman (1:52:46.440)

in that if you're running a full node,

Lex Fridman (1:52:48.300)

you can verify that the Bitcoin is Bitcoin, right?

Lex Fridman (1:52:51.180)

It cannot be tampered with, it cannot be faked.

Lex Fridman (1:52:54.880)

And in addition to that, as a node operator,

Lex Fridman (1:52:57.260)

you can audit the total supply of Bitcoin at any time,

Robert Breedlove (1:53:00.000)

which is unlike any money in history.

Lex Fridman (1:53:01.560)

So you know with full certainty,

Robert Breedlove (1:53:04.180)

if you're holding 1000 Bitcoin,

Lex Fridman (1:53:06.820)

you have 1000 out of a possible 21 million forever.

Robert Breedlove (1:53:10.420)

You have a guaranteed fraction of the total supply.

Lex Fridman (1:53:13.040)

Yeah, so a full node contains information

Robert Breedlove (1:53:14.740)

about every transaction that's ever been had

Lex Fridman (1:53:16.580)

so you can figure out, yeah, I mean,

Robert Breedlove (1:53:19.180)

all the truth of this money is all right there.

Lex Fridman (1:53:23.840)

Yeah, it's like a fractal constituent

Lex Fridman (1:53:25.800)

of the whole network, right?

Lex Fridman (1:53:27.100)

The whole Bitcoin blockchain is comprised in a node too.

Robert Breedlove (1:53:30.820)

Not the proof of work piece,

Lex Fridman (1:53:32.180)

but the entire transaction history.

Lex Fridman (1:53:34.380)

And so that's unique as well.

Lex Fridman (1:53:37.060)

And that's what makes Bitcoin the ultimate store of value

Robert Breedlove (1:53:39.940)

is that you know with certainty what the total supply is

Lex Fridman (1:53:43.780)

and will ever be.

Lex Fridman (1:53:45.100)

And you know that your share of that supply is fixed.

Lex Fridman (1:53:49.440)

It cannot change.

Robert Breedlove (1:53:50.460)

It can only improve actually.

Lex Fridman (1:53:51.860)

If someone loses, you know,

Robert Breedlove (1:53:53.700)

if the Satoshi stash is truly gone forever,

Lex Fridman (1:53:56.020)

the million Bitcoin never moves,

Robert Breedlove (1:53:58.000)

then we're talking about 1000 Bitcoin

Lex Fridman (1:53:59.960)

out of 20 million instead and so on and so forth.

Robert Breedlove (1:54:03.140)

As more people lose access to their Bitcoin,

Lex Fridman (1:54:05.760)

they're basically making a contribution to everyone else.

Robert Breedlove (1:54:08.060)

It's anti dilutive.

Lex Fridman (1:54:10.460)

And there's certain properties of Bitcoin

Robert Breedlove (1:54:13.200)

that are sort of a little bit more into the details

Lex Fridman (1:54:15.500)

that ensure that the full nodes,

Robert Breedlove (1:54:19.080)

like the size of all the transactions that ever happened,

Lex Fridman (1:54:22.860)

at least currently can be stored

Robert Breedlove (1:54:24.340)

in a single computer, for example.

Lex Fridman (1:54:25.740)

So it doesn't blow up too quickly.

Robert Breedlove (1:54:28.040)

That's right.

Lex Fridman (1:54:28.880)

But you know, there's arguments that that's not necessarily,

Robert Breedlove (1:54:32.100)

you can make arguments for that to be a very nice property,

Lex Fridman (1:54:35.660)

but you can also say that there's like drawbacks to it.

Robert Breedlove (1:54:38.260)

That's hence the block size debates

Lex Fridman (1:54:41.540)

and all those kinds of things.

Lex Fridman (1:54:42.500)

Yeah, that was the Bitcoin Cash Civil War, right?

Lex Fridman (1:54:45.300)

Was that particular piece.

Robert Breedlove (1:54:47.580)

Yeah.

Lex Fridman (1:54:48.420)

And, you know, ostensibly they were saying,

Robert Breedlove (1:54:50.780)

oh, we need more transaction throughput

Lex Fridman (1:54:52.840)

to buy more coffee and do more transactions.

Lex Fridman (1:54:55.380)

But what they were actually doing

Lex Fridman (1:54:57.520)

was increasing the size computing power necessary

Robert Breedlove (1:55:01.900)

to run a full node,

Lex Fridman (1:55:03.060)

which would have theoretically compromised decentralization.

Lex Fridman (1:55:06.800)

So yeah, but it would in theory,

Lex Fridman (1:55:09.540)

and this is, you know, in theory,

Robert Breedlove (1:55:11.660)

it would allow you to have much more transactions.

Lex Fridman (1:55:15.100)

That's right.

Lex Fridman (1:55:16.020)

But the drawback, it would,

Lex Fridman (1:55:18.540)

because of no longer can be stored in a single computer,

Robert Breedlove (1:55:21.740)

personal computer, then it naturally leads

Lex Fridman (1:55:24.740)

to the centralization.

Robert Breedlove (1:55:25.940)

Yes.

Lex Fridman (1:55:26.780)

Which you see with gold.

Robert Breedlove (1:55:28.060)

Which would have compromised its survivability.

Lex Fridman (1:55:30.660)

Right.

Lex Fridman (1:55:31.780)

So, I said, what else is there?

Lex Fridman (1:55:34.300)

The last one, which leads straight into this one,

Robert Breedlove (1:55:36.300)

actually is the most important one of money,

Lex Fridman (1:55:38.460)

which is scarcity.

Lex Fridman (1:55:40.020)

And that you need to know the supply is fixed

Lex Fridman (1:55:45.220)

and safeguarded from counterfeiting and inflation,

Robert Breedlove (1:55:49.460)

which counterfeiting and inflation are the same thing,

Lex Fridman (1:55:52.620)

by the way.

Robert Breedlove (1:55:53.740)

Counterfeiting is criminalized inflation.

Lex Fridman (1:55:57.460)

Inflation is legalized counterfeiting.

Lex Fridman (1:56:00.140)

So central banks today,

Lex Fridman (1:56:01.780)

when they say they're printing money, they're not.

Robert Breedlove (1:56:03.220)

They're counterfeiting currency.

Lex Fridman (1:56:05.480)

That's a very important part.

Lex Fridman (1:56:07.140)

And Bitcoin, as I've argued in some of my writing,

Lex Fridman (1:56:11.380)

is more than just an invention.

Robert Breedlove (1:56:13.540)

It's actually the discovery of absolute scarcity.

Lex Fridman (1:56:16.840)

And that we have unveiled a property of money

Robert Breedlove (1:56:20.040)

that we will only discover once, and it's got really

Lex Fridman (1:56:25.460)

major ramifications for the world at large.

Lex Fridman (1:56:28.720)

So with gold, for instance, as we've covered,

Lex Fridman (1:56:33.660)

it became money because it was the most relatively scarce

Lex Fridman (1:56:36.980)

monetary metal, right?

Lex Fridman (1:56:37.980)

Its supply was hardest to increase over time.

Robert Breedlove (1:56:41.100)

However, if we could somehow flip a switch today

Lex Fridman (1:56:44.180)

and make everyone in the world go out and start mining gold,

Robert Breedlove (1:56:46.920)

we could increase the supply much more quickly.

Lex Fridman (1:56:49.100)

We could, you know, it's historic inflation rates

Robert Breedlove (1:56:50.980)

about 2%, we could double that pretty quickly.

Lex Fridman (1:56:54.960)

Bitcoin, with Bitcoin, it is not possible.

Lex Fridman (1:56:58.580)

So no matter how much effort and energy and capital

Lex Fridman (1:57:02.500)

and operational expenditure we pour into the mining network,

Robert Breedlove (1:57:05.540)

we cannot deviate from its fixed

Lex Fridman (1:57:08.300)

and diminishing supply curve from between now

Lex Fridman (1:57:11.000)

and the last Bitcoin being mined in 2140

Lex Fridman (1:57:13.620)

because of the difficulty adjustment.

Robert Breedlove (1:57:15.020)

It's constantly, it's adapting to human action actually.

Lex Fridman (1:57:18.420)

So the harder we pursue it, the more that it recedes,

Lex Fridman (1:57:21.940)

and then the less we pursue it,

Lex Fridman (1:57:23.340)

the more available it makes itself.

Lex Fridman (1:57:26.020)

And this is, it's a real major breakthrough

Lex Fridman (1:57:30.300)

because it's the closest thing to perfect information

Robert Breedlove (1:57:34.640)

we've ever had in an economy.

Lex Fridman (1:57:37.340)

And perfect information is this, it's a theoretical,

Lex Fridman (1:57:41.340)

but unattainable state of the market where all market actors

Lex Fridman (1:57:46.340)

have all the relevant information about everything

Lex Fridman (1:57:50.220)

so that they can compete as efficiently as possible.

Lex Fridman (1:57:53.100)

And in a state of pure information, we have,

Robert Breedlove (1:57:56.060)

I'm sorry, perfect information, we have perfect competition.

Lex Fridman (1:57:59.020)

And in perfect competition, we maximize wealth generation.

Lex Fridman (1:58:03.140)

So we're competing as freely as possible

Lex Fridman (1:58:06.420)

from coercive and violent impediments.

Lex Fridman (1:58:10.140)

And so I think Bitcoin in that sense

Lex Fridman (1:58:13.220)

is going to pull the world closer to a state

Robert Breedlove (1:58:17.900)

of perfect competition than we've ever been before,

Lex Fridman (1:58:21.720)

which would increase wealth generation

Robert Breedlove (1:58:24.560)

to an extent we've never seen before.

Lex Fridman (1:58:27.540)

Many of the things you said about Bitcoin

Robert Breedlove (1:58:30.460)

also hold for other cryptocurrency technologies

Lex Fridman (1:58:32.860)

that followed after.

Lex Fridman (1:58:36.120)

Can you say something to why you think Bitcoin

Lex Fridman (1:58:40.680)

is the superior technology

Robert Breedlove (1:58:43.900)

from a pragmatic truth perspective than say Ethereum,

Lex Fridman (1:58:49.200)

but also other crypto, like Bitcoin Cash,

Robert Breedlove (1:58:52.660)

like other hard forks of Bitcoin,

Lex Fridman (1:58:55.380)

and maybe things that might yet to be invented,

Lex Fridman (1:58:59.780)

tools yet to be invented?

Lex Fridman (1:59:01.420)

Yeah, so this is a good point of argument

Robert Breedlove (1:59:05.100)

because a lot of people have countered me and said,

Lex Fridman (1:59:08.380)

Bitcoin cannot be absolute scarcity

Robert Breedlove (1:59:11.260)

because you can fork it and create something

Lex Fridman (1:59:13.220)

with the same properties as Bitcoin

Lex Fridman (1:59:15.500)

or potentially even better properties, right?

Lex Fridman (1:59:17.700)

You create something with a deflationary monetary policy.

Robert Breedlove (1:59:21.620)

That's what Bitcoin Cash was actually.

Lex Fridman (1:59:23.620)

It forked Bitcoin with all of the same properties

Robert Breedlove (1:59:26.220)

except for the block size that we alluded to earlier.

Lex Fridman (1:59:29.260)

The problem is that money is valued.

Robert Breedlove (1:59:33.020)

Again, it's the good with a configuration of demand

Lex Fridman (1:59:36.580)

that is predominantly marketability.

Lex Fridman (1:59:40.400)

So it is valued based on its liquidity.

Lex Fridman (1:59:43.560)

That is how many other trading partners are there

Robert Breedlove (1:59:46.620)

in that monetary network.

Lex Fridman (1:59:48.780)

So it is a network valued because of its liquidity

Lex Fridman (1:59:53.420)

and network effects.

Lex Fridman (1:59:54.820)

So any new entrant into the market for money

Robert Breedlove (1:59:59.180)

is incentivized to always choose the money

Lex Fridman (20:00.320)

for the economy.

Robert Breedlove (20:02.200)

The first thing they tend to monopolize is money

Lex Fridman (20:04.680)

because if you can control the money,

Robert Breedlove (20:05.840)

you're effectively controlling people, their energy,

Lex Fridman (20:08.060)

their perceptions.

Lex Fridman (20:10.560)

And that becomes a, you know,

Lex Fridman (20:12.360)

particularly through inflation,

Robert Breedlove (20:14.560)

becomes an avenue to get something for nothing

Lex Fridman (20:17.520)

and that you can just print more money

Robert Breedlove (20:20.000)

that everyone else is forced to sacrifice their time

Lex Fridman (20:22.840)

and energy to obtain.

Lex Fridman (20:24.100)

What are your thoughts about anarchism?

Lex Fridman (20:27.580)

So I talk quite a bit, he'll be here in a few days,

Robert Breedlove (20:30.940)

actually, Michael Malice, about ideas of anarchy.

Lex Fridman (20:35.420)

And his idea or the idea of anarchists

Robert Breedlove (20:38.100)

is that any amount of government will eventually become

Lex Fridman (20:42.100)

the very kind of thing that you're referring to.

Lex Fridman (20:45.660)

So there's almost no way to have a government

Lex Fridman (20:48.460)

that doesn't then try to monopolize power,

Robert Breedlove (20:52.180)

money, and all those kinds of things.

Lex Fridman (20:54.360)

Do you think it's possible to have a government

Robert Breedlove (20:56.900)

sort of on that spectrum of like anarchy,

Lex Fridman (20:59.760)

maybe libertarianism,

Robert Breedlove (21:02.020)

I'm not sure how exactly the spectrum goes,

Lex Fridman (21:04.620)

but where you have a small government

Robert Breedlove (21:07.160)

that protects the liberty and property rights

Lex Fridman (21:09.060)

and those kinds of things and doesn't expand

Robert Breedlove (21:11.940)

to then also control the monetary system

Lex Fridman (21:15.420)

and all those other things?

Lex Fridman (21:17.620)

Is it possible?

Lex Fridman (21:18.500)

Agreed completely, it was not possible until Satoshi Nakamoto.

Lex Fridman (21:24.120)

So for the first time in history,

Lex Fridman (21:25.620)

we have a money that cannot be monopolized,

Robert Breedlove (21:29.180)

cannot be corrupted, cannot be changed,

Lex Fridman (21:32.920)

cannot be weaponized, frankly.

Robert Breedlove (21:34.460)

Our current monetary system is weaponized

Lex Fridman (21:36.680)

by those who can print money against those who cannot.

Lex Fridman (21:41.660)

And I think when you have,

Lex Fridman (21:45.060)

at the heart of every modern economy,

Robert Breedlove (21:46.880)

which even we could say the US,

Lex Fridman (21:48.620)

we pride ourselves as free market capitalists.

Robert Breedlove (21:51.460)

You know, we out competed communism in the 20th century.

Lex Fridman (21:54.320)

We think that this is the superior model.

Robert Breedlove (21:58.080)

Most business people will tell you

Lex Fridman (22:00.540)

that the free market is the best allocator of resources,

Robert Breedlove (22:03.780)

all of these things.

Lex Fridman (22:05.300)

But what we have at the heart of every modern economy,

Robert Breedlove (22:07.500)

including the US, is an anti capitalistic institution,

Lex Fridman (22:10.740)

which is the central bank.

Robert Breedlove (22:13.560)

The temptation to monopolize money

Lex Fridman (22:15.460)

throughout all of history has been too strong

Robert Breedlove (22:17.100)

for anyone to resist.

Lex Fridman (22:18.680)

So any, even benevolent, quote unquote,

Robert Breedlove (22:21.540)

dictators that have taken over,

Lex Fridman (22:23.400)

many dictators have inherited, say,

Robert Breedlove (22:25.300)

an inflationary regime where society is coming apart

Lex Fridman (22:28.260)

because someone was clipping the coins

Robert Breedlove (22:29.580)

or someone was printing too much money,

Lex Fridman (22:31.260)

and they'll commit to going back to a hard money standard.

Lex Fridman (22:34.140)

So they'll keep society on a gold standard, for instance,

Lex Fridman (22:37.840)

such that they cannot violate the money

Robert Breedlove (22:40.860)

to benefit themselves.

Lex Fridman (22:42.140)

But inevitably, over time, because it is

Lex Fridman (22:45.820)

a political institution, there's an incentive there, right?

Lex Fridman (22:50.660)

For, again, to get something for nothing,

Robert Breedlove (22:53.140)

to spend more than you're making through tax revenues.

Lex Fridman (22:57.260)

And with that incentive, people typically,

Robert Breedlove (22:59.700)

ultimately end up pursuing that inflationary path.

Lex Fridman (23:03.400)

So we can get deeper into that about,

Robert Breedlove (23:06.680)

inflation is a term that we've been conditioned

Lex Fridman (23:09.400)

to think today is just something normal.

Robert Breedlove (23:10.940)

The prices just go up, and then it's pertinent

Lex Fridman (23:14.780)

to a healthy economy, but it's actually,

Robert Breedlove (23:18.820)

if you look at it from real first principles,

Lex Fridman (23:20.300)

it is just theft integrated into the money.

Robert Breedlove (23:22.540)

It's a technology backdoor,

Lex Fridman (23:23.980)

is another way to think about it.

Robert Breedlove (23:25.420)

You wouldn't buy a cell phone knowing

Lex Fridman (23:27.500)

that someone could siphon your data off your private calls

Lex Fridman (23:30.420)

and sell it into the market.

Lex Fridman (23:31.980)

Now, I know we do that with a lot of social media stuff

Robert Breedlove (23:33.700)

today, and that's something else we can get into,

Lex Fridman (23:35.180)

but you wouldn't do it willingly, right?

Robert Breedlove (23:37.580)

You prefer that your cell phone and your data

Lex Fridman (23:40.280)

was monetized by you, or if you're gonna sell it,

Robert Breedlove (23:43.140)

you would be able to selectively sell it.

Lex Fridman (23:45.420)

Inflation is that it's similar, it's a tech backdoor.

Lex Fridman (23:49.100)

So it's a money that only a few people

Lex Fridman (23:53.500)

can siphon value off of surreptitiously, typically slowly,

Lex Fridman (23:58.340)

but eventually, as we've seen throughout history,

Lex Fridman (24:00.080)

that slowly builds up into a rapidly

Lex Fridman (24:02.580)

and then causes the monetary system to collapse.

Lex Fridman (24:05.820)

Do you think there's a benefit to inflation, possibly?

Lex Fridman (24:08.400)

So when you have perfect information,

Lex Fridman (24:12.420)

perhaps you don't need inflation,

Robert Breedlove (24:14.260)

perhaps it is purely theft, but I think of inflation

Lex Fridman (24:17.220)

as like the snooze button on the alarm.

Lex Fridman (24:21.860)

So if you have a hard standard,

Lex Fridman (24:23.460)

you better wake up when the alarm rings,

Lex Fridman (24:25.820)

but all of us kind of like probably shouldn't,

Lex Fridman (24:29.340)

but use the snooze button.

Robert Breedlove (24:30.700)

It's like, okay, well, five more minutes

Lex Fridman (24:32.220)

or 10 more minutes, and then you're saying

Robert Breedlove (24:34.860)

there's naturally a slippery slope

Lex Fridman (24:36.980)

where it becomes a drug that you fall in love with

Lex Fridman (24:40.140)

and you abuse, but nevertheless,

Lex Fridman (24:43.980)

the usefulness of the snooze button

Robert Breedlove (24:46.260)

is that you don't know how you'll be actually feeling

Lex Fridman (24:48.860)

when the alarm rings.

Robert Breedlove (24:50.300)

You might be able to ready to pop up.

Lex Fridman (24:52.220)

It might be like you really need those few more minutes

Robert Breedlove (24:55.420)

to psychologically get yourself out of bed.

Lex Fridman (24:57.540)

This metaphor is just not working at all,

Lex Fridman (24:59.820)

but do you think there's a use to inflation sometimes

Lex Fridman (25:04.820)

from like an economics perspective?

Robert Breedlove (25:06.900)

I think the drug metaphor is a little more apt

Lex Fridman (25:09.620)

in that inflation does provide

Robert Breedlove (25:12.260)

an immediately stimulative effect when used early on.

Lex Fridman (25:19.620)

But what it's doing is it's, again,

Robert Breedlove (25:22.980)

we talk about the balance between incentives

Lex Fridman (25:26.140)

and disincentives, right?

Robert Breedlove (25:27.340)

That being necessary for a system to function properly.

Lex Fridman (25:31.580)

With inflation, you're essentially giving the people

Robert Breedlove (25:35.620)

that can print money a way to dampen

Lex Fridman (25:38.420)

the disincentives they face.

Lex Fridman (25:40.780)

So it destroys feedback loops, I guess you might say.

Lex Fridman (25:46.580)

And another way to look at this is when you,

Lex Fridman (25:49.340)

so using inflation, using quantitative easing,

Lex Fridman (25:52.260)

you can decrease short term volatility in the marketplace.

Lex Fridman (25:56.880)

So the market is basically this idea,

Lex Fridman (26:01.140)

this form of free exchange that's trying to zero in

Robert Breedlove (26:03.300)

on the best ideas.

Lex Fridman (26:04.500)

And the ideas are those that are most fit to reality,

Robert Breedlove (26:07.020)

to satisfying the most wants.

Lex Fridman (26:08.780)

It's gonna overshoot, it's gonna undershoot,

Robert Breedlove (26:10.380)

you have these little business cycles.

Lex Fridman (26:12.020)

But when it's undershooting

Lex Fridman (26:13.500)

and you're experiencing a business recession,

Lex Fridman (26:18.020)

in a capitalist environment,

Robert Breedlove (26:19.140)

the market needs to clear that malinvestment,

Lex Fridman (26:21.940)

that misallocation of capital.

Robert Breedlove (26:23.260)

That means someone made a bet on a certain idea

Lex Fridman (26:25.420)

that it would satisfy wants in a particular way,

Lex Fridman (26:27.820)

and that bet did not pan out.

Lex Fridman (26:29.460)

If you then paper over the losses

Robert Breedlove (26:31.460)

that business is creating,

Lex Fridman (26:33.020)

you're now delaying and exacerbating the volatility

Robert Breedlove (26:36.820)

that that idea created.

Lex Fridman (26:39.140)

So this is kind of a Tel Aviv concept

Robert Breedlove (26:41.400)

where you can dampen short run volatility,

Lex Fridman (26:46.060)

but volatility is truth.

Lex Fridman (26:48.340)

Volatility is us matching our ideas to reality, right?

Lex Fridman (26:53.420)

We're constantly, again, overshooting and undershooting.

Lex Fridman (26:55.200)

So you delay volatility,

Lex Fridman (26:57.640)

you're just amplifying it and exacerbating it

Robert Breedlove (26:59.820)

in the long run.

Lex Fridman (27:01.180)

And that's what central bank is doing.

Robert Breedlove (27:02.740)

The central bank mandate is low unemployment

Lex Fridman (27:06.860)

and low and expected inflation, basically.

Lex Fridman (27:13.300)

And so they're trying to achieve economic growth

Lex Fridman (27:16.820)

in a stable way, quote unquote, stable way.

Robert Breedlove (27:19.500)

This is their ostensible purpose.

Lex Fridman (27:22.380)

And that's just not possible.

Robert Breedlove (27:23.940)

Growth is an inherently instable process.

Lex Fridman (27:27.780)

Can you elaborate a little bit

Lex Fridman (27:29.420)

about the nature of volatility?

Lex Fridman (27:33.380)

Why is it communicating truth?

Robert Breedlove (27:37.140)

That's something that a lot of people are afraid of

Lex Fridman (27:39.060)

is the volatility.

Robert Breedlove (27:40.340)

Almost like it's a sign of chaos,

Lex Fridman (27:44.260)

and so they want to escape chaos.

Lex Fridman (27:48.220)

But you're saying that that's actually,

Lex Fridman (27:51.740)

whether it's chaos or not, I don't know,

Lex Fridman (27:53.640)

but it's getting us closer to the fundamental reality

Lex Fridman (27:57.600)

that we should not be trying to escape.

Robert Breedlove (28:00.100)

Yeah, so if we consider that the universe

Lex Fridman (28:04.980)

is pervaded by entropy, right?

Robert Breedlove (28:06.980)

This is the second law of thermodynamics

Lex Fridman (28:08.780)

is that every closed system

Robert Breedlove (28:10.080)

tends towards greater disorder over time.

Lex Fridman (28:13.500)

And that life itself, again,

Robert Breedlove (28:15.420)

I would argue expressed through the logos,

Lex Fridman (28:19.080)

we, life, is the antientropic principle.

Robert Breedlove (28:22.180)

It's the only thing that's converting entropy into order,

Lex Fridman (28:24.740)

chaos into order.

Lex Fridman (28:26.500)

And that's what entrepreneurs are doing, right?

Lex Fridman (28:29.980)

We're living at the edges of the known,

Lex Fridman (28:32.700)

and we're testing ourself against the entropy of nature,

Lex Fridman (28:37.240)

trying to figure out new and better ways

Robert Breedlove (28:38.900)

of saying, doing, or making things.

Lex Fridman (28:41.020)

And then if we do crack a code or figure something out,

Robert Breedlove (28:44.260)

we then have a big incentive.

Lex Fridman (28:45.700)

The incentive is to get rich, right?

Robert Breedlove (28:47.180)

Because then you have a new idea

Lex Fridman (28:48.380)

that you could then sell back into the marketplace.

Lex Fridman (28:50.940)

So it's this sequence of courageously confronting

Lex Fridman (28:57.360)

the entropy of nature and converting it

Robert Breedlove (28:59.500)

into good and useful order,

Lex Fridman (29:00.820)

which by the way is like the ancient idea of God in Genesis,

Robert Breedlove (29:04.100)

which I think is interesting,

Lex Fridman (29:06.900)

that actually enables us to construct civilization

Robert Breedlove (29:10.120)

in these layers of anti entropy or order, you might say.

Lex Fridman (29:14.900)

So today we live in a bubble of anti entropy or order,

Robert Breedlove (29:19.900)

like the coastlines are guarded by the nation

Lex Fridman (29:22.300)

and the city has a certain police force

Robert Breedlove (29:25.340)

that keeps it in order.

Lex Fridman (29:27.940)

Even the way we talk,

Robert Breedlove (29:30.260)

like clearly the words matter,

Lex Fridman (29:31.780)

but also the nonverbal cues,

Robert Breedlove (29:33.060)

all these things are like order that has been established

Lex Fridman (29:35.340)

over many, many, many thousands of years of human evolution.

Lex Fridman (29:40.660)

And I think that's, when I say volatility is truth,

Lex Fridman (29:46.180)

what I'm saying is that the experience of uncertainty

Lex Fridman (29:49.340)

is something that's ineradicable from life, right?

Lex Fridman (29:53.580)

And certainty, like it's kind of a paradox

Lex Fridman (29:57.060)

because we're fighting against it, right?

Lex Fridman (29:58.980)

We're trying to innovate our way away from uncertainty

Robert Breedlove (2:00:02.780)

with the deepest liquidity and the most network effects.

Lex Fridman (2:00:06.460)

This is why money has tended to be a winner take all market

Lex Fridman (2:00:10.540)

because it's essentially a single purpose tool, right?

Lex Fridman (2:00:13.480)

It is a tool for,

Lex Fridman (2:00:16.600)

if we consider that tools are time saving devices, right?

Lex Fridman (2:00:19.700)

The shovel that you dig more holes per man hour

Robert Breedlove (2:00:21.680)

than you can with your bare hands.

Lex Fridman (2:00:23.180)

Money is a tool, there's yet another definition of money

Robert Breedlove (2:00:26.280)

that lets us calculate, negotiate

Lex Fridman (2:00:28.580)

and execute trades more quickly.

Lex Fridman (2:00:31.540)

So that function tends to coalesce

Lex Fridman (2:00:36.180)

towards one solution.

Lex Fridman (2:00:38.500)

And so the short answer would be that

Lex Fridman (2:00:40.860)

for the same reasons, quantifiable reasons, right?

Robert Breedlove (2:00:44.620)

Like inflation resistance and liquidity and network effects

Lex Fridman (2:00:48.500)

that we have one analog gold,

Robert Breedlove (2:00:50.660)

we're only likely to have one digital gold.

Lex Fridman (2:00:53.540)

And I think the Bitcoin Cash Fork

Robert Breedlove (2:00:55.500)

proves that out empirically.

Lex Fridman (2:00:57.220)

It's a good case study because.

Lex Fridman (2:00:59.540)

Well, it's one case study, right?

Lex Fridman (2:01:00.860)

But okay, so that's really well put.

Lex Fridman (2:01:02.980)

So like gold was sticky.

Lex Fridman (2:01:04.580)

Once it was accepted, the network effects,

Robert Breedlove (2:01:08.460)

the winner take all took over.

Lex Fridman (2:01:11.020)

And here's a fundamentally different kind of like

Robert Breedlove (2:01:15.380)

analog versus digital is a leap in technologies.

Lex Fridman (2:01:18.700)

That's right.

Lex Fridman (2:01:19.900)

And you're suggesting that there may not be,

Lex Fridman (2:01:25.340)

there's unlikely to be other leaps of that kind

Robert Breedlove (2:01:29.100)

into a whole nother kind of space of technologies.

Lex Fridman (2:01:32.260)

I would argue that Bitcoin,

Robert Breedlove (2:01:34.700)

it's kind of like the ideological synthesis of gold,

Lex Fridman (2:01:38.040)

taking the monetary properties of gold

Lex Fridman (2:01:39.380)

and combining them with the internet itself.

Lex Fridman (2:01:41.860)

And in doing so,

Lex Fridman (2:01:43.220)

it has essentially perfected the properties of money, right?

Lex Fridman (2:01:47.140)

You can't get more divisible, durable, recognizable,

Robert Breedlove (2:01:49.700)

portable, or scarce than Bitcoin.

Lex Fridman (2:01:51.780)

So Satoshi has kind of,

Robert Breedlove (2:01:54.260)

he left no design space for a superior technology

Lex Fridman (2:01:58.360)

to intercede and out compete Bitcoin at this point.

Robert Breedlove (2:02:01.320)

Now that it's established liquidity

Lex Fridman (2:02:02.720)

in the network effects. Far superior technology, right?

Robert Breedlove (2:02:04.740)

Yeah, but it's a combination of the tech itself

Lex Fridman (2:02:07.340)

and the social layer that is coalesced to it.

Robert Breedlove (2:02:10.220)

You can't separate those two out.

Lex Fridman (2:02:11.740)

Like they're all connected and then the political as well.

Robert Breedlove (2:02:15.020)

I mean, but the portability, for example,

Lex Fridman (2:02:17.460)

that's another way to phrase that is the,

Lex Fridman (2:02:20.060)

what is it, the scaling.

Lex Fridman (2:02:22.000)

So the number of transactions,

Robert Breedlove (2:02:24.400)

that's a limitation for Bitcoin

Lex Fridman (2:02:27.080)

that many argue is a feature, many argue is a bug.

Robert Breedlove (2:02:30.880)

You have a bunch of cryptocurrency technologies

Lex Fridman (2:02:33.500)

that are able to achieve much higher,

Robert Breedlove (2:02:37.020)

much faster frequency of transactions,

Lex Fridman (2:02:40.420)

much more transactions, you know, all that kind of stuff.

Lex Fridman (2:02:44.700)

What are your thoughts on that?

Lex Fridman (2:02:47.380)

You know, the low level of transactions

Robert Breedlove (2:02:49.660)

that's possible with Bitcoin.

Lex Fridman (2:02:51.760)

Do you think that's a feature?

Lex Fridman (2:02:52.880)

Do you think that's a bug?

Lex Fridman (2:02:54.500)

Necessary for security actually.

Lex Fridman (2:02:56.860)

And even these other crypto assets that settle more quickly,

Lex Fridman (2:03:00.280)

they settle with less assurance of finality.

Lex Fridman (2:03:03.660)

So Nick Carter has a great piece on this actually called,

Lex Fridman (2:03:07.080)

the settlement assurance is stupid.

Robert Breedlove (2:03:09.260)

It's really good where the gist of it is

Lex Fridman (2:03:11.540)

that there is more work being done in each block of Bitcoin

Robert Breedlove (2:03:16.780)

that it can't, it is less vulnerable to reversion.

Lex Fridman (2:03:20.700)

So it's giving you higher degrees of assurance

Robert Breedlove (2:03:23.900)

that your settlement or your trade has occurred

Lex Fridman (2:03:26.040)

with finality, whereas other blockchains

Robert Breedlove (2:03:28.540)

are much more vulnerable.

Lex Fridman (2:03:31.300)

And again, with Bitcoin, the evolutionary path of money

Robert Breedlove (2:03:35.780)

with gold is that it was first used as a collectible.

Lex Fridman (2:03:40.600)

It then became used as a store value.

Robert Breedlove (2:03:43.140)

After it had stored enough value,

Lex Fridman (2:03:44.740)

it began to be used as a medium of exchange.

Lex Fridman (2:03:48.740)

And then finally, when it was used widely enough

Lex Fridman (2:03:50.260)

as a medium of exchange, it becomes a unit of account.

Robert Breedlove (2:03:52.580)

We actually start to think in the money.

Lex Fridman (2:03:54.940)

Bitcoin's following a similar path.

Lex Fridman (2:03:56.880)

So started out as kind of a collectible.

Lex Fridman (2:04:00.420)

Today, I would argue it's a store value,

Robert Breedlove (2:04:02.260)

one of the most effective store value we've ever seen.

Lex Fridman (2:04:05.620)

So that evolutionary path that Bitcoin's following

Robert Breedlove (2:04:08.580)

is similar to gold.

Lex Fridman (2:04:10.260)

First a collectible, today a store value.

Robert Breedlove (2:04:12.260)

To be an effective store value,

Lex Fridman (2:04:13.940)

it has to optimize for supply cap.

Robert Breedlove (2:04:18.540)

That has to be the first,

Lex Fridman (2:04:19.900)

and this is all Bitcoin really needs to do

Robert Breedlove (2:04:22.300)

to be successful by the way.

Lex Fridman (2:04:23.780)

Exactly what it's been doing for 12 years,

Robert Breedlove (2:04:25.860)

virtually flawlessly,

Lex Fridman (2:04:27.420)

which is keep creating a block every 10 minutes

Lex Fridman (2:04:30.340)

and keep enforcing a supply cap of 21 million.

Lex Fridman (2:04:34.020)

As long as those two things hold,

Robert Breedlove (2:04:36.880)

it is sound money, the ultimate sound money,

Lex Fridman (2:04:40.620)

the most inflation resistant money there's ever been.

Robert Breedlove (2:04:44.620)

It's actually completely immune.

Lex Fridman (2:04:47.800)

It's taken unexpected inflation to 0%.

Robert Breedlove (2:04:50.340)

We know with perfect certainty

Lex Fridman (2:04:51.620)

what Bitcoin supply will ever be.

Robert Breedlove (2:04:53.420)

For it to be used more broadly as a medium of exchange,

Lex Fridman (2:04:59.540)

it can't make trade offs at the base layer

Robert Breedlove (2:05:02.260)

to increase its portability for instance.

Lex Fridman (2:05:05.340)

Even though portability is maybe kind of a misnomer

Robert Breedlove (2:05:07.980)

because Bitcoin has extremely high portability,

Lex Fridman (2:05:10.620)

just doesn't have extremely high transaction throughput.

Lex Fridman (2:05:13.500)

So we could say you can move it pretty quickly

Lex Fridman (2:05:16.680)

anywhere in the world

Robert Breedlove (2:05:17.520)

as long as you're willing to bid up for the block space,

Lex Fridman (2:05:20.980)

but you can't satisfy all the world's economic volume.

Robert Breedlove (2:05:24.980)

You can't do 300 million transactions per second

Lex Fridman (2:05:27.100)

like you can on a centralized database like Visa.

Lex Fridman (2:05:30.700)

But Bitcoin needs to be this,

Lex Fridman (2:05:34.740)

it has to be a store value first

Robert Breedlove (2:05:36.380)

before it can be a medium of exchange.

Lex Fridman (2:05:38.740)

So it has to protect the supply cap first

Robert Breedlove (2:05:42.620)

before making any trade offs for that.

Lex Fridman (2:05:44.340)

And I would argue that that's why Bitcoin is so rigid,

Robert Breedlove (2:05:48.340)

is that it's optimized for survivability

Lex Fridman (2:05:50.140)

and optimized for that supply cap.

Lex Fridman (2:05:51.720)

And it's pushing experimentation and other features

Lex Fridman (2:05:56.100)

that would increase its transaction throughput

Robert Breedlove (2:05:57.760)

to higher layers.

Lex Fridman (2:05:59.420)

So I think Lightning Network

Robert Breedlove (2:06:01.420)

is something that's very interesting.

Lex Fridman (2:06:03.460)

It's still early,

Lex Fridman (2:06:05.700)

but there's a lot of throughput already being used

Lex Fridman (2:06:08.660)

on the Lightning Network.

Lex Fridman (2:06:10.540)

And it makes some slight trade offs

Lex Fridman (2:06:14.260)

in terms of the trust minimization of Bitcoin.

Robert Breedlove (2:06:16.060)

You end up trusting these smart contracts

Lex Fridman (2:06:18.180)

instead of move the Bitcoin,

Lex Fridman (2:06:19.500)

but you pick up nearly unlimited transaction throughput.

Lex Fridman (2:06:22.940)

So that's how, and that's how biology evolves.

Robert Breedlove (2:06:25.620)

That's how the internet evolved.

Lex Fridman (2:06:26.780)

It evolves in layers.

Lex Fridman (2:06:27.860)

So I think Bitcoin,

Lex Fridman (2:06:29.960)

you can sort of conceive of it

Robert Breedlove (2:06:31.020)

as the latest layer to the internet.

Lex Fridman (2:06:33.820)

And it's one that preserves this store value property

Robert Breedlove (2:06:36.860)

better than any asset we've ever had.

Lex Fridman (2:06:38.920)

Let me ask sort of a critical question of,

Robert Breedlove (2:06:41.820)

if you're wrong about your statements about Bitcoin,

Lex Fridman (2:06:46.060)

and you find out years from now that you were wrong,

Lex Fridman (2:06:51.860)

what would that look like?

Lex Fridman (2:06:54.020)

What would be the things

Lex Fridman (2:06:55.300)

that make you realize you were wrong?

Lex Fridman (2:06:57.520)

Likely ideas or crazy out there ideas?

Lex Fridman (2:07:01.320)

Do you think about this kind of stuff?

Lex Fridman (2:07:03.180)

All the time.

Robert Breedlove (2:07:04.020)

Because you speak very confidently about Bitcoin.

Lex Fridman (2:07:08.480)

And one of the things, let me put it this way.

Robert Breedlove (2:07:11.580)

I think certainty,

Lex Fridman (2:07:13.440)

I feel like that's like a stoic statement.

Robert Breedlove (2:07:16.640)

Certainty leads to ruin, something like that.

Lex Fridman (2:07:19.800)

Like certainty, I think is an antithesis to progress often.

Lex Fridman (2:07:26.640)

And especially in your writing,

Lex Fridman (2:07:28.260)

but this is true for the Bitcoin community.

Robert Breedlove (2:07:29.920)

There's a certainty about the Bitcoin.

Lex Fridman (2:07:34.960)

And that makes me very skeptical,

Robert Breedlove (2:07:36.860)

no matter how good the ideas are.

Lex Fridman (2:07:38.880)

Whenever things are good, this might be the Russian in me.

Lex Fridman (2:07:42.220)

I think like, what are the ways this is gonna go wrong?

Lex Fridman (2:07:46.160)

So what do you think are the ways this might go wrong

Lex Fridman (2:07:48.800)

or you're wrong in your conception of what Bitcoin is?

Lex Fridman (2:07:53.040)

Yeah, so science evolves via negativa,

Robert Breedlove (2:07:59.800)

meaning that we're not proving hypotheses

Lex Fridman (2:08:04.200)

and that's what becomes the body of science.

Robert Breedlove (2:08:06.940)

Science is whatever is left over as we disprove hypotheses.

Lex Fridman (2:08:12.540)

Whatever we can empirically, through experimentation,

Robert Breedlove (2:08:17.340)

disprove, gets discarded.

Lex Fridman (2:08:19.680)

And whatever remains, whatever theory remains,

Robert Breedlove (2:08:23.180)

it hasn't been disproven, is science, effectively.

Lex Fridman (2:08:28.500)

This process is similar to market actors zeroing in

Lex Fridman (2:08:33.600)

on a store value, right?

Lex Fridman (2:08:35.620)

They're experimenting with different forms

Robert Breedlove (2:08:37.760)

of storing wealth across time.

Lex Fridman (2:08:41.180)

Some do better than others

Lex Fridman (2:08:42.540)

and eventually everyone ends up on the one that is best.

Lex Fridman (2:08:45.540)

That's what gold was.

Robert Breedlove (2:08:47.940)

In terms of understanding Bitcoin,

Lex Fridman (2:08:51.280)

I look at it as a similar approach.

Lex Fridman (2:08:53.460)

And that is the main question I'm asking myself

Lex Fridman (2:08:55.660)

is how do you stop this thing?

Lex Fridman (2:08:57.580)

How do you turn it off?

Lex Fridman (2:08:59.220)

How do you end it?

Robert Breedlove (2:09:00.060)

If you're a nation state, particularly,

Lex Fridman (2:09:02.220)

who has the most to lose in this transition,

Lex Fridman (2:09:05.220)

what is the attack vector by which they neutralize Bitcoin?

Lex Fridman (2:09:08.500)

I mean, that is the $250 trillion question.

Lex Fridman (2:09:12.140)

And I've spent five years thinking about this thing

Lex Fridman (2:09:16.580)

very deeply.

Robert Breedlove (2:09:17.420)

I've read everything on monetary history.

Lex Fridman (2:09:19.400)

I can get my hands on.

Robert Breedlove (2:09:23.660)

The general thought of how it is stopped,

Lex Fridman (2:09:27.860)

and this is the snag point that a lot of people get to

Robert Breedlove (2:09:31.300)

in their explorations down the rabbit hole,

Lex Fridman (2:09:32.820)

is they just say the government will never allow it.

Lex Fridman (2:09:35.180)

And that becomes kind of their bottom.

Lex Fridman (2:09:36.580)

It's like, all right, Bitcoin's interesting,

Robert Breedlove (2:09:37.800)

it's superior money, blah, blah, blah,

Lex Fridman (2:09:39.140)

but the government will never allow it.

Lex Fridman (2:09:40.780)

And they say.

Lex Fridman (2:09:41.620)

Was Ray Dalio, did he say that?

Robert Breedlove (2:09:43.340)

Dalio was currently stuck there, yeah.

Lex Fridman (2:09:45.800)

So Ray Dalio said that Bitcoin seems to be too promising.

Robert Breedlove (2:09:52.580)

If it is in fact as promising as it looks,

Lex Fridman (2:09:56.740)

governments are going to,

Robert Breedlove (2:09:59.260)

I don't forget what the exact quote is,

Lex Fridman (2:10:00.860)

but not allowed.

Robert Breedlove (2:10:02.280)

Ban it.

Lex Fridman (2:10:03.660)

Governments will ban it.

Lex Fridman (2:10:05.300)

So how do you get Ray Dalio unstuck from your perspective?

Lex Fridman (2:10:09.940)

Well.

Lex Fridman (2:10:10.780)

And how do you get unstuck from that idea

Lex Fridman (2:10:12.740)

that governments, will governments,

Lex Fridman (2:10:14.860)

how do you prevent governments from stopping a thing

Lex Fridman (2:10:18.440)

that threatens centralized power?

Robert Breedlove (2:10:22.580)

Well, Bitcoin is an idea.

Lex Fridman (2:10:26.060)

So governments that are really good

Lex Fridman (2:10:30.300)

at fighting centralized threats to their power, right?

Lex Fridman (2:10:35.060)

Whether that's a currency counterfeiter

Robert Breedlove (2:10:36.700)

or competing nation state or business they don't like,

Lex Fridman (2:10:40.400)

or an individual they don't like,

Robert Breedlove (2:10:42.500)

you know, they can kill them, they can throw them in jail.

Lex Fridman (2:10:44.940)

They can use any number of course

Robert Breedlove (2:10:46.700)

of a violent tactics to suppress it.

Lex Fridman (2:10:49.300)

But how do you point a gun at an idea?

Lex Fridman (2:10:52.600)

How do you coerce an idea?

Lex Fridman (2:10:56.580)

And that's, you know, there's some anecdotal history here

Robert Breedlove (2:11:03.400)

where there's the PGP case, which in the United States,

Lex Fridman (2:11:09.400)

the court was trying to classify it as munitions.

Robert Breedlove (2:11:12.320)

When we were shipping this

Lex Fridman (2:11:13.920)

pretty good privacy software overseas,

Robert Breedlove (2:11:17.920)

government wanted to classify it as munitions

Lex Fridman (2:11:19.440)

and restrict that exportation.

Robert Breedlove (2:11:22.380)

But, and this was a circuit court case precedent.

Lex Fridman (2:11:25.320)

When the PGP attorneys actually printed out the source code

Robert Breedlove (2:11:30.000)

on paper and presented it as evidence in the court,

Lex Fridman (2:11:33.560)

all of a sudden it became protected under freedom of speech

Lex Fridman (2:11:36.400)

and that it's just code is speech, code is language.

Lex Fridman (2:11:40.360)

And therefore, at least in the United States,

Robert Breedlove (2:11:43.080)

it's protected under the first amendment.

Lex Fridman (2:11:47.920)

I think a government ban would be largely unenforceable,

Robert Breedlove (2:11:52.760)

frankly, on Bitcoin.

Lex Fridman (2:11:54.560)

Being that it's pure information,

Robert Breedlove (2:11:56.920)

if you suppress market actors

Lex Fridman (2:12:00.440)

from using it in one jurisdiction,

Robert Breedlove (2:12:02.160)

you're just creating incentives for them to go elsewhere.

Lex Fridman (2:12:05.860)

And you're actually increasing the incentive

Robert Breedlove (2:12:07.440)

for other jurisdictions to be favorable towards it

Lex Fridman (2:12:11.320)

because then they can create,

Robert Breedlove (2:12:12.880)

they get to benefit from the tax revenue

Lex Fridman (2:12:14.480)

and the businesses and the innovation

Robert Breedlove (2:12:16.400)

that's occurring in and around Bitcoin as a result.

Lex Fridman (2:12:19.360)

So you don't think if a particular central bank,

Robert Breedlove (2:12:21.920)

like in Europe or United States,

Lex Fridman (2:12:25.040)

bans it, not maybe using those terms,

Lex Fridman (2:12:28.440)

but in some kind of way,

Lex Fridman (2:12:30.440)

you think that provides a really strong incentive

Robert Breedlove (2:12:32.760)

for the other big players to enable it.

Lex Fridman (2:12:36.320)

That's right.

Lex Fridman (2:12:38.560)

And that they're more likely, by the way,

Lex Fridman (2:12:40.640)

and governments know this, by the way, too.

Robert Breedlove (2:12:42.560)

The other thing that causes a government

Lex Fridman (2:12:46.160)

to shoot itself in the foot is that if they ban something,

Robert Breedlove (2:12:48.320)

they draw a lot of attention to it.

Lex Fridman (2:12:50.520)

People are smart.

Lex Fridman (2:12:51.520)

I mean, people ask why, why would a government ban it?

Lex Fridman (2:12:53.920)

Why can't I use this?

Lex Fridman (2:12:55.220)

So that's kind of typically be the last arrow

Lex Fridman (2:12:57.640)

in their quiver.

Robert Breedlove (2:12:59.760)

They may try to ban it if Bitcoin

Lex Fridman (2:13:02.280)

really starts to monetize very quickly.

Lex Fridman (2:13:04.080)

And the power structures that they impose today

Lex Fridman (2:13:06.640)

start to dissolve faster than others might think they will,

Robert Breedlove (2:13:12.240)

then they might try and ban it.

Lex Fridman (2:13:13.440)

But I think that ban will be largely unenforceable.

Robert Breedlove (2:13:17.760)

They're more likely to tax it,

Lex Fridman (2:13:19.480)

which they already do tax it.

Robert Breedlove (2:13:21.480)

They're likely to increase taxation of it.

Lex Fridman (2:13:25.480)

They're likely to try and make it more white market

Robert Breedlove (2:13:28.520)

by actually tracing Bitcoin, seeing who has it,

Lex Fridman (2:13:32.400)

attaching identities to Bitcoin ownership,

Lex Fridman (2:13:36.060)

and making sure that they're getting their pound of flesh

Lex Fridman (2:13:38.280)

on all the transactions it results in.

Lex Fridman (2:13:41.600)

But I don't think, the other thing about this is,

Lex Fridman (2:13:45.760)

so we saw the internet outcompete intranets,

Robert Breedlove (2:13:53.000)

in that we'd say that open source networks

Lex Fridman (2:13:55.200)

tend to outcompete closed source networks.

Lex Fridman (2:13:57.100)

And there's a really good reason for this.

Lex Fridman (2:13:59.320)

And it's because in a closed source network,

Robert Breedlove (2:14:03.520)

there are costs associated with defending the network itself.

Lex Fridman (2:14:08.180)

So you have to, the network owners,

Robert Breedlove (2:14:12.180)

the owners of the closed source network

Lex Fridman (2:14:13.460)

have to expend resources protecting it from competitors.

Lex Fridman (2:14:17.560)

And they have to expend resources imposing its rules

Lex Fridman (2:14:21.000)

because they're not voluntarily adopted rules.

Lex Fridman (2:14:23.220)

So you actually have to impose these rule sets.

Lex Fridman (2:14:25.380)

Whereas an open source network,

Robert Breedlove (2:14:26.880)

which is something much more akin to capitalism

Lex Fridman (2:14:29.160)

in its pure sense, these are voluntarily adopted rules.

Lex Fridman (2:14:33.000)

So all market participants have agreed

Lex Fridman (2:14:34.880)

and consented to this rule set.

Lex Fridman (2:14:36.720)

So there's no enforcement costs

Lex Fridman (2:14:38.400)

and there's no turf protection

Robert Breedlove (2:14:39.620)

because anyone can freely enter or exit the open network.

Lex Fridman (2:14:43.000)

For that energetic reason,

Robert Breedlove (2:14:45.020)

I think open networks outcompete close networks typically.

Lex Fridman (2:14:50.520)

And in the digital age, that's why I think open,

Robert Breedlove (2:14:53.560)

that's why internet outcompetes intranet

Lex Fridman (2:14:55.200)

and that's why open source networks

Robert Breedlove (2:14:57.240)

are gonna eat closed source networks.

Lex Fridman (2:14:58.840)

So what Bitcoin would be in that lens

Robert Breedlove (2:15:01.180)

is the ultimate open source monetary network

Lex Fridman (2:15:04.220)

devouring closed source central bank monetary networks.

Lex Fridman (2:15:08.460)

And I just don't see how there's no possibility

Lex Fridman (2:15:14.280)

of unilaterally stopping Bitcoin or destroying it.

Lex Fridman (2:15:17.560)

So then they're more likely to regulate or tax it.

Lex Fridman (2:15:23.360)

And again, the other fallacy here

Robert Breedlove (2:15:25.160)

is that a lot of people tend to think of governments

Lex Fridman (2:15:26.780)

as these singular indivisible entities,

Robert Breedlove (2:15:30.760)

like they just move under one plan.

Lex Fridman (2:15:32.920)

But in reality, it's a lot of people, right?

Robert Breedlove (2:15:34.960)

A lot of people with loosely coupled interests

Lex Fridman (2:15:36.880)

and agendas and whatnot, regulators and others

Robert Breedlove (2:15:43.080)

whether wearing their citizen hat,

Lex Fridman (2:15:45.640)

they're gonna see this thing monetizing,

Robert Breedlove (2:15:47.320)

they're gonna be on the front lines

Lex Fridman (2:15:48.640)

of trying to regulate it, trying to control it.

Lex Fridman (2:15:52.120)

And I think what's likely to happen

Lex Fridman (2:15:53.480)

is they're gonna start to adopt it,

Robert Breedlove (2:15:55.600)

to buy some of it even as an individual

Lex Fridman (2:15:59.480)

or possibly even ultimately at a central bank

Robert Breedlove (2:16:02.040)

or sovereign wealth fund level,

Lex Fridman (2:16:03.760)

as an insurance policy against its success.

Lex Fridman (2:16:07.200)

And once you start to acquire something

Lex Fridman (2:16:09.640)

and then you have a vested economic interest

Robert Breedlove (2:16:12.760)

in its monetization,

Lex Fridman (2:16:14.360)

I think it kind of dissolves any of the power structures

Robert Breedlove (2:16:17.560)

that are arrayed against it from the inside.

Lex Fridman (2:16:20.520)

So I've written a lot about this

Robert Breedlove (2:16:22.720)

in a new series called Sovereignism,

Lex Fridman (2:16:24.480)

which is based loosely on a book

Robert Breedlove (2:16:26.640)

called The Sovereign Individual.

Lex Fridman (2:16:28.760)

And that's the general thesis

Robert Breedlove (2:16:30.240)

is that microprocessing technology would devour

Lex Fridman (2:16:34.080)

our organizational models,

Robert Breedlove (2:16:35.780)

the most important of which is the nation state.

Lex Fridman (2:16:38.300)

So I think we're going into this world

Robert Breedlove (2:16:39.960)

where coercion and violence is just much less rewarding.

Lex Fridman (2:16:47.600)

The economics of violence are declining

Lex Fridman (2:16:50.380)

because of the low cost of protecting property, right?

Lex Fridman (2:16:54.460)

You can now protect your monetary property in Bitcoin

Robert Breedlove (2:16:59.460)

at orders of magnitude less cost

Lex Fridman (2:17:01.800)

than is necessary to run a banking network.

Lex Fridman (2:17:04.020)

So it changes the way we organize ourselves.

Lex Fridman (2:17:09.520)

And again, zooming back to gold

Robert Breedlove (2:17:12.240)

as kind of the original governor to governments,

Lex Fridman (2:17:14.740)

where if they manipulated the money,

Robert Breedlove (2:17:16.200)

gold would leave their country.

Lex Fridman (2:17:18.040)

That's why governments have taken relatively concerted action

Robert Breedlove (2:17:23.180)

to go off of the gold standard.

Lex Fridman (2:17:25.320)

There's a great book on this called The Gold Wars

Robert Breedlove (2:17:27.720)

that outlines how governments have been waging

Lex Fridman (2:17:32.120)

a cold war against gold for the past 50 years.

Robert Breedlove (2:17:35.840)

Bitcoin sort of renews hope

Lex Fridman (2:17:39.240)

for that free market governor of governments.

Lex Fridman (2:17:41.600)

And that is this digital gold

Lex Fridman (2:17:42.860)

that governments cannot stop or coopt.

Lex Fridman (2:17:45.520)

So I think it's something,

Lex Fridman (2:17:47.680)

that's why I think it's such a big deal

Robert Breedlove (2:17:49.480)

is that it is changing,

Lex Fridman (2:17:54.480)

it's a new useful fiction, you might say.

Robert Breedlove (2:17:56.800)

A useful fiction that's superordinate

Lex Fridman (2:17:58.600)

to the mythology of the nation state and government

Robert Breedlove (2:18:02.240)

as the dominant institution in the world.

Lex Fridman (2:18:04.240)

Well, I hope you're right

Robert Breedlove (2:18:05.400)

that all forms of centralized power

Lex Fridman (2:18:10.400)

start breaking apart naturally.

Lex Fridman (2:18:12.660)

So governments, the more and more power

Lex Fridman (2:18:14.960)

is given to the individual, whatever the technology is.

Lex Fridman (2:18:18.400)

And Bitcoin seems to be a promising technology

Lex Fridman (2:18:20.720)

that empowers that, enables that.

Robert Breedlove (2:18:22.880)

That seems to be the trend.

Lex Fridman (2:18:24.720)

And that's a promising trend

Robert Breedlove (2:18:26.320)

at least from a perspective of somebody

Lex Fridman (2:18:29.120)

who values this particular biological meat bag

Robert Breedlove (2:18:33.400)

that's full of consciousness.

Lex Fridman (2:18:34.800)

I think Bitcoin is exposing the greatest scam

Robert Breedlove (2:18:37.680)

in human history, which is political authority.

Lex Fridman (2:18:40.720)

Like who gives anyone the right to be politically,

Lex Fridman (2:18:43.860)

have political authority over anyone else?

Lex Fridman (2:18:46.100)

People should be free to adopt the rules

Lex Fridman (2:18:49.040)

and systems and tools that best suit their needs.

Lex Fridman (2:18:52.040)

And that arc of history we covered earlier

Robert Breedlove (2:18:56.180)

where as socioeconomic systems have become more favorable

Lex Fridman (2:19:01.920)

towards individual sovereignty,

Robert Breedlove (2:19:03.440)

the more wealthy we have become,

Lex Fridman (2:19:06.120)

the more we have given the individual,

Robert Breedlove (2:19:07.880)

we've maximized individual choice,

Lex Fridman (2:19:10.520)

the more wealth that society has created

Lex Fridman (2:19:12.440)

and the more it has out competed

Lex Fridman (2:19:14.460)

the systems that have come before it.

Robert Breedlove (2:19:15.840)

The latest would be capitalism triumphing over socialism.

Lex Fridman (2:19:21.040)

Before maybe we eat, you are in Texas,

Robert Breedlove (2:19:23.920)

you brought over some brisket.

Lex Fridman (2:19:25.720)

Before we may be indulge in that,

Robert Breedlove (2:19:28.000)

let me bring up one quick topic

Lex Fridman (2:19:30.000)

and then we'll take a break.

Lex Fridman (2:19:31.680)

And the topic of what some may term

Lex Fridman (2:19:35.720)

the toxicity of the Bitcoin community.

Robert Breedlove (2:19:40.480)

You've written that Bitcoin toxicity is tough love.

Lex Fridman (2:19:44.400)

Do you wanna break that apart a little bit

Robert Breedlove (2:19:46.660)

sort of the idea, the philosophy of the toxicity

Lex Fridman (2:19:51.660)

that seems to be present in part in the Bitcoin community?

Robert Breedlove (2:19:58.620)

Yeah, we were talking about this a little bit

Lex Fridman (2:20:01.380)

before we recorded and I've been through the gauntlet

Robert Breedlove (2:20:04.780)

with Bitcoin toxicity as well.

Lex Fridman (2:20:07.580)

I came into this space professionally in 2017.

Robert Breedlove (2:20:12.940)

I was originally running a multi strategy

Lex Fridman (2:20:15.000)

crypto asset hedge fund.

Lex Fridman (2:20:17.160)

And my initial investment thesis on the world

Lex Fridman (2:20:21.620)

was that Bitcoin was a big deal,

Lex Fridman (2:20:23.260)

but there were all these other exciting coins

Lex Fridman (2:20:25.220)

and projects and ways the technology was going to be used.

Lex Fridman (2:20:28.880)

And that view of reality met this immune,

Lex Fridman (2:20:35.420)

I guess you could say as an ideological immune system,

Robert Breedlove (2:20:37.980)

this Bitcoin toxicity and that it's kind of a filter

Lex Fridman (2:20:40.940)

that's trying to catch bad or useless

Robert Breedlove (2:20:45.460)

or even scamming ideas that this space is very well known for.

Lex Fridman (2:20:52.860)

As we've touched on today, Bitcoin, in my opinion,

Robert Breedlove (2:20:55.180)

is this world shattering innovation,

Lex Fridman (2:20:57.940)

but it's in a sea of the most scammy stuff ever, right?

Robert Breedlove (2:21:01.500)

People, anybody can go and create a coin.

Lex Fridman (2:21:05.460)

So you can go and launch one immediately online

Lex Fridman (2:21:09.480)

and you can throw up a website, an advisor page,

Lex Fridman (2:21:14.020)

post a white paper talking about

Lex Fridman (2:21:15.060)

how great your technology is gonna be

Lex Fridman (2:21:16.500)

and how it's gonna change the world.

Lex Fridman (2:21:17.640)

And then you can raise $30 million in Bitcoin

Lex Fridman (2:21:20.240)

or Ethereum in 30 seconds kind of thing.

Lex Fridman (2:21:22.660)

So it's drawn in a lot of this scam artistry, you might say.

Lex Fridman (2:21:27.500)

And I think people living through that,

Robert Breedlove (2:21:31.180)

because there is this natural predilection for people

Lex Fridman (2:21:33.500)

when they first come into Bitcoin, you're excited about it,

Robert Breedlove (2:21:35.920)

then you get lost in the shit coin universe.

Lex Fridman (2:21:39.460)

And then just looking at the market success

Robert Breedlove (2:21:43.340)

of Bitcoin versus, and when I use the word shit coin,

Lex Fridman (2:21:46.060)

I'm just.

Robert Breedlove (2:21:47.040)

You say with all the love in the world.

Lex Fridman (2:21:49.020)

All the love in the world.

Robert Breedlove (2:21:50.660)

I guess you could call me a toxic maximalist in some ways,

Lex Fridman (2:21:53.180)

although I consider myself a freedom maximalist,

Robert Breedlove (2:21:55.420)

not a Bitcoin maximalist.

Lex Fridman (2:21:56.260)

Yeah, I saw that line, that's a good line.

Robert Breedlove (2:21:59.740)

Bitcoin, tracking the market success of Bitcoin

Lex Fridman (2:22:03.100)

versus alternative crypto assets,

Robert Breedlove (2:22:06.300)

the signal is very clear

Lex Fridman (2:22:07.400)

that Bitcoin has out competed all of them.

Lex Fridman (2:22:09.480)

So I think that Bitcoin cultural toxicity has evolved

Lex Fridman (2:22:13.140)

as an immune response to those bad ideas,

Robert Breedlove (2:22:15.620)

which is actually, if you think about it,

Lex Fridman (2:22:17.780)

kind of is a tough love, right?

Robert Breedlove (2:22:19.100)

You don't want new entrance to the space

Lex Fridman (2:22:21.660)

to get lost in shit coin jungle and learn the hard way,

Robert Breedlove (2:22:26.140)

the way many Bitcoin maximalists have

Lex Fridman (2:22:28.060)

that the real innovation is Bitcoin.

Lex Fridman (2:22:31.320)

But like an immune system, I think it can also go too far.

Lex Fridman (2:22:36.500)

And so I think it's useful when it is defending the space

Robert Breedlove (2:22:40.840)

from false narratives, we might say,

Lex Fridman (2:22:43.460)

but it becomes detrimental when it's attacking people

Robert Breedlove (2:22:48.180)

that are inquiring about Bitcoin

Lex Fridman (2:22:50.080)

or people that are approaching Bitcoin

Robert Breedlove (2:22:52.240)

with a good spirit and good intention

Lex Fridman (2:22:54.860)

and a desire to learn.

Robert Breedlove (2:22:57.420)

Because then at that point,

Lex Fridman (2:22:58.340)

it's actually impeding the free flow of ideas,

Robert Breedlove (2:23:01.720)

which the example in your clip

Lex Fridman (2:23:04.580)

that was totally taken out of context.

Lex Fridman (2:23:06.500)

And then you're literally just saying,

Lex Fridman (2:23:07.940)

I'm here to learn and contribute.

Robert Breedlove (2:23:09.240)

I think I've got some stuff to do.

Lex Fridman (2:23:10.780)

And then people attack that.

Robert Breedlove (2:23:11.860)

Like that doesn't make any fucking sense.

Lex Fridman (2:23:13.900)

It's like you're attacking someone who's approaching it

Robert Breedlove (2:23:16.140)

in a good spirit and asking questions.

Lex Fridman (2:23:18.380)

Yeah, and I think sometimes talking about it,

Robert Breedlove (2:23:22.660)

the toxicity in the Bitcoin community as an immune response

Lex Fridman (2:23:26.440)

has a negative effect of giving it a pass

Robert Breedlove (2:23:30.740)

because like it almost says,

Lex Fridman (2:23:32.620)

look, it equates it with the human immune system,

Robert Breedlove (2:23:35.940)

which seems to do a really good job.

Lex Fridman (2:23:38.620)

And so you could say that the toxicity has a lot of features

Robert Breedlove (2:23:42.500)

in the sea of fraudulent projects

Lex Fridman (2:23:47.780)

that steal money from people.

Robert Breedlove (2:23:52.180)

It's really useful to make sure

Lex Fridman (2:23:53.860)

that you give people the harsh truth

Robert Breedlove (2:23:56.420)

about who is and isn't a scammer.

Lex Fridman (2:24:00.020)

You have to take it apart,

Robert Breedlove (2:24:02.260)

take it away from that metaphor of the immune system

Lex Fridman (2:24:04.460)

and look at basic human nature.

Lex Fridman (2:24:06.620)

And human nature can go to some dark places,

Lex Fridman (2:24:09.180)

which is it's sad to say that some people,

Robert Breedlove (2:24:15.220)

maybe many of us can enjoy for its own sake, the toxicity,

Lex Fridman (2:24:21.060)

the mockery, the derision,

Lex Fridman (2:24:23.300)

and you stop being part of the immune system

Lex Fridman (2:24:27.940)

that makes a successful idea propagate

Lex Fridman (2:24:31.000)

and start being a sort of a destructive virus yourself.

Lex Fridman (2:24:35.120)

And that's something I think about

Robert Breedlove (2:24:37.740)

because I am new to this particular immune system,

Lex Fridman (2:24:43.140)

but I've explored other immune systems.

Lex Fridman (2:24:45.980)

And I think you understand this world much better than me,

Lex Fridman (2:24:54.820)

but I tend to prefer sort of love

Robert Breedlove (2:24:57.780)

as a mechanism for spreading ideas,

Lex Fridman (2:25:00.340)

to err on the side of love and kindness

Lex Fridman (2:25:06.220)

and almost like an open mindedness

Lex Fridman (2:25:09.300)

in a way where you're constantly lowering yourself

Robert Breedlove (2:25:13.180)

in the face of other ideas, constantly questioning yourself.

Lex Fridman (2:25:17.820)

But I think I understand that that might be more applicable

Robert Breedlove (2:25:24.180)

in certain contexts,

Lex Fridman (2:25:25.180)

like maybe in the space of science or something like that.

Lex Fridman (2:25:28.080)

But in the space of Bitcoin, as it currently stands,

Lex Fridman (2:25:31.260)

there's so many people that are trying to scam others

Robert Breedlove (2:25:33.980)

out of their money

Lex Fridman (2:25:35.580)

that the kind of harshness required is different.

Robert Breedlove (2:25:39.100)

Nevertheless, I do want to put it on people like yourself

Lex Fridman (2:25:45.060)

and others who I know you wouldn't consider yourself this,

Lex Fridman (2:25:48.180)

but you're one of the faces or leaders in this space

Lex Fridman (2:25:51.460)

to call people out a little bit,

Robert Breedlove (2:25:53.660)

to inspire them to be more loving, I suppose.

Lex Fridman (2:25:57.220)

But it's difficult,

Robert Breedlove (2:25:58.140)

because you want to walk that line carefully.

Lex Fridman (2:26:00.260)

You don't want to be too loving and open minded,

Robert Breedlove (2:26:03.260)

otherwise your brain falls out.

Lex Fridman (2:26:04.540)

I get it, it's a difficult balance to walk.

Robert Breedlove (2:26:06.980)

It is subtle and it's nuanced and it is difficult to walk.

Lex Fridman (2:26:11.140)

And I think that, that's why I try to say tough love,

Robert Breedlove (2:26:14.220)

because when we're young, we may have certain ideas

Lex Fridman (2:26:19.220)

about the way we want our life to go,

Lex Fridman (2:26:21.620)

but then maybe our parents

Lex Fridman (2:26:22.980)

are not letting us do certain things.

Lex Fridman (2:26:25.300)

And we think they're, I know when I was a kid,

Lex Fridman (2:26:27.260)

I wanted to get my, when I was in fifth grade,

Robert Breedlove (2:26:28.620)

I wanted to get my ear pierced.

Lex Fridman (2:26:30.220)

My mom wouldn't let me do it.

Lex Fridman (2:26:31.580)

And I was, oh, come on, mom, I thought it was so cool.

Lex Fridman (2:26:34.460)

And then two years later, I'm like, thank you, mom,

Robert Breedlove (2:26:36.700)

for letting me get my ear pierced.

Lex Fridman (2:26:39.460)

I think it comes from a place of good intention

Robert Breedlove (2:26:41.700)

that they are actually,

Lex Fridman (2:26:44.700)

they have asked themselves that question, right?

Robert Breedlove (2:26:46.780)

That they've been inquiring

Lex Fridman (2:26:48.660)

in why not this crypto asset or this crypto asset?

Lex Fridman (2:26:51.940)

And they've done the exploration,

Lex Fridman (2:26:53.380)

they keep coming back to Bitcoin

Lex Fridman (2:26:54.940)

and they've seen people being taken advantage of.

Lex Fridman (2:26:59.580)

But to your point, it's like it can,

Robert Breedlove (2:27:03.880)

this tough love can become detrimental,

Lex Fridman (2:27:06.780)

just like the immune system can become detrimental, right?

Robert Breedlove (2:27:08.980)

It can overreact and it can actually harm the human body.

Lex Fridman (2:27:12.420)

So I would say that it's such a tricky and nuanced topic

Lex Fridman (2:27:16.220)

that even biology hasn't figured it out, right?

Lex Fridman (2:27:18.180)

A lot of people have autoimmune diseases.

Lex Fridman (2:27:21.980)

And then there's the other thing

Lex Fridman (2:27:22.820)

that we have this natural, I agree with you about love.

Robert Breedlove (2:27:25.780)

I think love is like the deepest value.

Lex Fridman (2:27:28.660)

That's a whole nother philosophical thing,

Lex Fridman (2:27:30.540)

but we're biologically programmed to pay more attention

Lex Fridman (2:27:36.260)

to things that are adversarial or harmful, right?

Robert Breedlove (2:27:38.860)

That's part of us protecting the meat suit, so to speak.

Lex Fridman (2:27:42.340)

So there is some maybe better delivery method

Robert Breedlove (2:27:48.020)

by being a little bit toxic to really get the point across,

Lex Fridman (2:27:50.980)

like, hey, don't get lost over here.

Robert Breedlove (2:27:53.580)

These things can hurt you.

Lex Fridman (2:27:55.580)

Really try to focus on Bitcoin.

Lex Fridman (2:27:57.140)

But the toxicity of that message,

Lex Fridman (2:27:59.620)

I guess it increases its ability

Robert Breedlove (2:28:01.100)

to penetrate the individual, but it can also go too far.

Lex Fridman (2:28:04.140)

So it is very...

Robert Breedlove (2:28:05.220)

It's interesting, but I almost to push back a little bit,

Lex Fridman (2:28:08.780)

toxicity is a funny word.

Robert Breedlove (2:28:11.100)

I think maybe another way to say it is,

Lex Fridman (2:28:15.540)

I brought up like Christopher Hitchens

Lex Fridman (2:28:17.660)

and somebody who like, okay,

Lex Fridman (2:28:20.980)

you might say he's toxic or something like that,

Robert Breedlove (2:28:23.660)

because he's basically a intellectual powerhouse

Lex Fridman (2:28:27.100)

who's also a troll.

Lex Fridman (2:28:28.740)

So he's constantly, it's like guerrilla warfare

Lex Fridman (2:28:31.140)

in the space of ideas.

Robert Breedlove (2:28:33.340)

He's very harsh in his disagreements and criticisms,

Lex Fridman (2:28:37.020)

but he's done with incredible grace and skill and poetry.

Robert Breedlove (2:28:42.260)

So...

Lex Fridman (2:28:43.180)

We could use more of that.

Robert Breedlove (2:28:44.380)

We could use more of that.

Lex Fridman (2:28:45.780)

So toxicity just like...

Robert Breedlove (2:28:52.540)

These are just words.

Lex Fridman (2:28:53.540)

They can mean a lot of different things,

Lex Fridman (2:28:55.180)

but disagreement doesn't have to be done with love,

Lex Fridman (2:28:59.940)

but it should be done with skill if it's to be effective.

Lex Fridman (2:29:04.340)

So there's a lot of ways to be effective in guerrilla warfare,

Lex Fridman (2:29:08.300)

but you wanna learn how to shoot

Robert Breedlove (2:29:10.180)

or whatever the weapon you're using and to do it well.

Lex Fridman (2:29:12.820)

Some people do it better than others.

Lex Fridman (2:29:14.540)

And it's worthwhile to learn to do it well.

Lex Fridman (2:29:17.780)

Again, I prefer love, but even love,

Robert Breedlove (2:29:21.180)

just because you think you're communicating a good idea,

Lex Fridman (2:29:25.420)

which you very well may be,

Robert Breedlove (2:29:26.740)

doesn't mean it also doesn't require skill

Lex Fridman (2:29:28.820)

to do the communication well,

Robert Breedlove (2:29:30.260)

whether it's disagreement and harsh

Lex Fridman (2:29:33.220)

or more agreement and loving and so on.

Robert Breedlove (2:29:36.860)

Yeah, I think very fundamentally that all of our decisions,

Lex Fridman (2:29:41.860)

we alluded to earlier that every decision

Robert Breedlove (2:29:44.500)

is an expression of value, every action we take,

Lex Fridman (2:29:47.100)

they ultimately come from fear or love.

Robert Breedlove (2:29:49.380)

Fear would be something much more in the biological domain

Lex Fridman (2:29:53.660)

where it's like, we're trying to protect ego,

Robert Breedlove (2:29:56.820)

we're trying to behave selfishly.

Lex Fridman (2:29:58.420)

This is the domain of sin.

Robert Breedlove (2:30:01.260)

I don't know all the sins, gluttony, greed, sloth, wrath,

Lex Fridman (2:30:03.700)

lust, pride, envy, these are all selfish behaviors.

Robert Breedlove (2:30:07.660)

Whereas something like love,

Lex Fridman (2:30:09.420)

it's morally superior in that it's more selfless.

Robert Breedlove (2:30:14.420)

I don't know that we can properly

Lex Fridman (2:30:15.740)

define love with words at all,

Lex Fridman (2:30:17.020)

but I would say maybe like selfless action

Lex Fridman (2:30:19.660)

could be kind of a generalization of it.

Lex Fridman (2:30:22.620)

And that way, it is really hard to your point.

Lex Fridman (2:30:25.620)

It's hard to love in a world that has a lot of conflict

Robert Breedlove (2:30:32.460)

that might make you fearful

Lex Fridman (2:30:34.500)

if you're really focused on your meat suit.

Lex Fridman (2:30:36.060)

But if you're focused on the bigger picture

Lex Fridman (2:30:37.780)

and you're focused on others and legacy and life,

Robert Breedlove (2:30:40.900)

that there is a way to do it.

Lex Fridman (2:30:43.020)

And that's why I actually think Christ,

Lex Fridman (2:30:44.820)

that is the highest moral aim, right?

Lex Fridman (2:30:46.580)

He met all of the vitriol in life,

Robert Breedlove (2:30:50.020)

betrayal, hate, violence,

Lex Fridman (2:30:52.540)

he met it all with love and he met it with compassion.

Lex Fridman (2:30:55.700)

And that's why, regardless of if you believe

Lex Fridman (2:30:58.220)

that he actually lived or any of this,

Robert Breedlove (2:31:00.820)

he is symbolic of the highest moral consciousness possible.

Lex Fridman (2:31:05.820)

And Carl Jung would say that that was a suitable

Robert Breedlove (2:31:09.540)

alternative to psychoanalysis,

Lex Fridman (2:31:12.340)

was actually setting your moral aim higher

Lex Fridman (2:31:14.740)

and striving towards it diligently.

Lex Fridman (2:31:16.940)

So, I mean, I agree completely.

Robert Breedlove (2:31:20.180)

We need more of that in the Bitcoin space.

Lex Fridman (2:31:22.740)

We need more of that in the world, frankly.

Robert Breedlove (2:31:24.140)

In the world, yeah.

Lex Fridman (2:31:24.980)

And these things, they're all intertwined.

Robert Breedlove (2:31:28.100)

We touched on the beginning, all of us get to decide,

Lex Fridman (2:31:32.140)

but the world does influence what we do.

Robert Breedlove (2:31:34.740)

It does influence kind of if we adopt fear or love,

Lex Fridman (2:31:39.860)

but it takes, I don't know, it takes good systems

Lex Fridman (2:31:42.100)

and it takes, I guess, good leaders to set an example.

Lex Fridman (2:31:45.420)

Yeah, I do believe that there's like individual people

Robert Breedlove (2:31:48.860)

can have a ripple effect.

Lex Fridman (2:31:50.620)

So that's what I try to do, sort of embody the,

Robert Breedlove (2:31:53.500)

I'm just one ant.

Lex Fridman (2:31:55.060)

But one of the things I have faith in is,

Robert Breedlove (2:31:59.580)

I'm trying to do that more.

Lex Fridman (2:32:02.380)

I know this is a podcast,

Lex Fridman (2:32:04.620)

but I'm trying to do less talking and more doing.

Lex Fridman (2:32:10.820)

I've been disappointed in myself, if I'm being honest,

Lex Fridman (2:32:13.260)

how much talking I've been doing,

Lex Fridman (2:32:15.980)

as opposed to, like in my own private life,

Robert Breedlove (2:32:20.140)

I live the thing I talk about,

Lex Fridman (2:32:22.100)

but I also haven't created much.

Lex Fridman (2:32:26.100)

And I believe in the power of individuals that create stuff,

Lex Fridman (2:32:30.660)

like create an idea through those individuals

Robert Breedlove (2:32:33.460)

that try to create something new, the world progresses.

Lex Fridman (2:32:35.700)

And hopefully there's more and more,

Robert Breedlove (2:32:37.100)

more and more of those people.

Lex Fridman (2:32:39.260)

So you mentioned kind of people who,

Lex Fridman (2:32:42.540)

what the Bitcoin community might call scammers.

Lex Fridman (2:32:48.220)

I have a lot of passions in my life

Robert Breedlove (2:32:50.460)

that I focus a lot of my attention to.

Lex Fridman (2:32:54.340)

Bitcoin doesn't happen to be yet one of them.

Robert Breedlove (2:32:59.340)

Bitcoin and cryptocurrency, you know.

Lex Fridman (2:33:01.460)

I'm always looking for things to really fall in love with.

Lex Fridman (2:33:08.460)

So how is a person like me supposed to figure out,

Lex Fridman (2:33:13.780)

I also happen to have a platform a little bit,

Lex Fridman (2:33:16.300)

and how am I supposed to figure out who is interesting,

Lex Fridman (2:33:21.460)

what is an interesting set of ideas and what are not?

Robert Breedlove (2:33:25.060)

Because people are financially tied into

Lex Fridman (2:33:27.220)

a lot of the cryptocurrencies that we're talking about,

Robert Breedlove (2:33:29.900)

certainly with Bitcoin, you know, their livelihood,

Lex Fridman (2:33:33.740)

their wellbeing is tied up to it.

Lex Fridman (2:33:35.340)

So it becomes much more emotional, much more personal.

Lex Fridman (2:33:37.940)

It's no longer purely an exploration of ideas.

Robert Breedlove (2:33:41.500)

It's really almost like a threat on your property.

Lex Fridman (2:33:44.060)

Like it's a personal threat

Lex Fridman (2:33:45.900)

and it makes it very difficult to explore those ideas.

Lex Fridman (2:33:47.940)

So I understand that, but it makes it very difficult

Robert Breedlove (2:33:50.420)

for somebody like me to just walk in and be curious.

Lex Fridman (2:33:55.420)

So how do I proceed in this difficult world

Robert Breedlove (2:33:59.540)

in exploring this landscape

Lex Fridman (2:34:02.100)

and not give a platform to ideas that may harm others?

Robert Breedlove (2:34:10.700)

I guess first I'd like to commend your forthrightness

Lex Fridman (2:34:14.700)

about this, because I don't think many people

Robert Breedlove (2:34:17.180)

try to walk that line necessarily.

Lex Fridman (2:34:18.980)

People, again, kind of the territorial imperative,

Robert Breedlove (2:34:22.540)

they'll put whoever on, they'll help expand their reach.

Lex Fridman (2:34:25.780)

Oh yeah, that's true.

Robert Breedlove (2:34:27.540)

Or say whatever needs to be said to expand their reach.

Lex Fridman (2:34:29.540)

So I think you're coming from a good place.

Robert Breedlove (2:34:31.340)

I'll say that.

Lex Fridman (2:34:33.780)

There's a great piece written

Robert Breedlove (2:34:36.020)

on the topic of scammers and scamming.

Lex Fridman (2:34:38.540)

I think it was by Goldstein.

Robert Breedlove (2:34:40.140)

He wrote a piece called, Everyone's a Scammer.

Lex Fridman (2:34:42.460)

And it's sort of back to this general human proclivity

Robert Breedlove (2:34:46.140)

to try and get something for nothing always,

Lex Fridman (2:34:48.540)

which again, it can be positive,

Robert Breedlove (2:34:50.900)

it can be innovative, or it can be a negative.

Lex Fridman (2:34:52.980)

You can be trying to steal from people.

Robert Breedlove (2:34:57.900)

That might be, I think that's a useful piece

Lex Fridman (2:34:59.940)

just to kind of see the crypto world through that lens.

Lex Fridman (2:35:03.300)

And that's how Bitcoiners are thinking all the time.

Lex Fridman (2:35:06.140)

They are by nature adversarial thinkers.

Lex Fridman (2:35:08.980)

So they're trying to minimize the need for trust

Lex Fridman (2:35:11.860)

in any situation and maximize verification.

Robert Breedlove (2:35:14.700)

As far as sifting through the ideas,

Lex Fridman (2:35:18.860)

I guess this is back where the cultural immune system

Robert Breedlove (2:35:23.860)

has some utility.

Lex Fridman (2:35:25.900)

Because there were times when I thought

Robert Breedlove (2:35:28.100)

this particular crypto asset,

Lex Fridman (2:35:30.700)

Augur was one I was really into,

Robert Breedlove (2:35:32.700)

that it could facilitate prediction markets

Lex Fridman (2:35:34.900)

and prediction markets could make markets more efficient,

Robert Breedlove (2:35:38.020)

et cetera, et cetera.

Lex Fridman (2:35:39.140)

But when that investment does get to the point

Robert Breedlove (2:35:43.460)

when that investment thesis basically met

Lex Fridman (2:35:45.940)

the cultural filter or immune system,

Robert Breedlove (2:35:49.540)

it forced me to reevaluate my position,

Lex Fridman (2:35:51.740)

forced me to really look into it more deeply.

Lex Fridman (2:35:54.220)

And through that exploration,

Lex Fridman (2:35:55.900)

I realized that it would need to be built on Bitcoin

Robert Breedlove (2:35:58.460)

to work basically.

Lex Fridman (2:35:59.940)

So it really comes down to like you doing your homework,

Lex Fridman (2:36:03.540)

but we can't all deeply evaluate every idea out there.

Lex Fridman (2:36:08.100)

One of the things I struggle with was Alex Jones,

Robert Breedlove (2:36:11.460)

for example, had dinner with him.

Lex Fridman (2:36:16.420)

I could tell that will be a very fun conversation,

Lex Fridman (2:36:19.060)

but like then I also understand that there's

Lex Fridman (2:36:24.140)

like consequences to that conversation

Robert Breedlove (2:36:27.820)

that should be explored with care.

Lex Fridman (2:36:30.700)

And so you need to take on the responsibility

Robert Breedlove (2:36:34.060)

of being a chef with the puffer fish

Lex Fridman (2:36:35.780)

and all those kinds of things.

Robert Breedlove (2:36:37.540)

That said, just like you said,

Lex Fridman (2:36:39.540)

it's very difficult to know this ahead of time

Lex Fridman (2:36:43.300)

and I will probably make mistakes.

Lex Fridman (2:36:46.620)

And that's a shitty thing to have to live with

Robert Breedlove (2:36:49.860)

that I'm going to make mistakes

Lex Fridman (2:36:51.260)

and some of them very large.

Robert Breedlove (2:36:52.900)

Like, yeah, I mean, I can imagine a bunch of different ways,

Lex Fridman (2:36:57.540)

but all we can do in this world

Robert Breedlove (2:36:59.060)

is once we make the mistakes,

Lex Fridman (2:37:00.860)

we acknowledge those mistakes and learn.

Lex Fridman (2:37:04.980)

And also, I have to put this on the rest of us

Lex Fridman (2:37:09.740)

that you don't take one thing that a person did

Lex Fridman (2:37:15.260)

and then burn them at the stake for it.

Lex Fridman (2:37:17.860)

That you realize that we all make mistakes,

Robert Breedlove (2:37:20.620)

that a particular mistake does not make the person.

Lex Fridman (2:37:23.220)

And this applies to taking stuff out of context

Robert Breedlove (2:37:27.660)

over hundreds of hours of talking,

Lex Fridman (2:37:30.660)

but it applies to actual, in context, big mistake.

Lex Fridman (2:37:37.380)

So what if I murdered somebody at some point?

Lex Fridman (2:37:39.260)

Just give me a break.

Robert Breedlove (2:37:40.100)

No, there are some things that are too far, of course,

Lex Fridman (2:37:42.340)

but in general, we need to give each other a chance.

Robert Breedlove (2:37:47.140)

Yeah, but I'm still,

Lex Fridman (2:37:50.460)

I walk with a heavy heart

Robert Breedlove (2:37:51.980)

knowing that I'll probably make a mistake,

Lex Fridman (2:37:54.180)

especially one that I didn't mean to.

Robert Breedlove (2:37:56.540)

That's the one that worries me most.

Lex Fridman (2:37:58.340)

This is human nature, like hamartia, to miss the mark.

Robert Breedlove (2:38:03.940)

That's the root word of sin.

Lex Fridman (2:38:05.500)

We are sinful by nature.

Robert Breedlove (2:38:07.300)

We can't help it.

Lex Fridman (2:38:08.300)

There's no way, again, pain is information, right?

Robert Breedlove (2:38:11.020)

There's no way to learn other than trying, failing,

Lex Fridman (2:38:15.460)

learning, and then you put yourself in better formation,

Robert Breedlove (2:38:19.620)

right, in formation to better deal with it next time.

Lex Fridman (2:38:22.900)

So I hope, I don't get the sense

Robert Breedlove (2:38:26.340)

that you're actually afraid of making a misstep.

Lex Fridman (2:38:30.580)

I think you're just maybe disappointed's a better word.

Robert Breedlove (2:38:35.740)

You know you're gonna make the mistakes.

Lex Fridman (2:38:36.900)

Yeah, that's exactly, that's a much, much better word.

Lex Fridman (2:38:39.380)

But we have to embrace that.

Lex Fridman (2:38:41.100)

That's the only way anything,

Robert Breedlove (2:38:42.260)

that's the only way we can advance,

Lex Fridman (2:38:43.880)

is that we're dealing with an incomprehensible reality.

Robert Breedlove (2:38:46.660)

All we can do is throw spaghetti at the wall

Lex Fridman (2:38:48.460)

and see what sticks.

Lex Fridman (2:38:50.180)

And in that process, we're all inherently gonna hurt

Lex Fridman (2:38:53.020)

ourselves and hurt others,

Lex Fridman (2:38:54.100)

and that's where love and forgiveness come into play, right?

Lex Fridman (2:38:57.740)

And yeah, I think the other thing is that this culture

Robert Breedlove (2:39:02.540)

of reducing people down to a label, right,

Lex Fridman (2:39:05.380)

whether it's racism or whether you're calling them a scammer

Robert Breedlove (2:39:07.780)

or any number of terms,

Lex Fridman (2:39:11.060)

you're discounting their sovereignty to zero, right?

Robert Breedlove (2:39:14.780)

You're taking a super complex human that is vast,

Lex Fridman (2:39:18.980)

contains multitudes, is changing over time,

Lex Fridman (2:39:21.880)

and you're trying to put them in a bucket of a word.

Lex Fridman (2:39:25.620)

And that is just, I think, a cognitive fallacy.

Robert Breedlove (2:39:28.700)

Like, it's not only gonna hurt the person

Lex Fridman (2:39:30.540)

that you're winnowing down to a word,

Robert Breedlove (2:39:32.980)

it's also gonna hurt you.

Lex Fridman (2:39:34.420)

And it's gonna, in your attempt to decomplexify reality

Robert Breedlove (2:39:38.860)

by assigning this person to a term,

Lex Fridman (2:39:40.260)

you're actually gonna create bad outcomes for yourself.

Robert Breedlove (2:39:42.880)

Because you're not gonna understand that person.

Lex Fridman (2:39:45.200)

I do also think there's a failure

Robert Breedlove (2:39:46.900)

of our social media technology that incentivizes

Lex Fridman (2:39:50.640)

that kind of reduction to a label.

Robert Breedlove (2:39:53.140)

It's just the viral nature of that reduction.

Lex Fridman (2:39:56.820)

So not only do we humans naturally do that,

Robert Breedlove (2:40:01.140)

our social media platforms make that easier, more fun,

Lex Fridman (2:40:07.260)

more effective to do that at scale, the mass hysteria.

Lex Fridman (2:40:11.340)

So I think there's actually technological ways

Lex Fridman (2:40:15.580)

of adding friction to that.

Robert Breedlove (2:40:18.180)

Yeah, I wonder, I mean, I agree with you that it's,

Lex Fridman (2:40:21.220)

social media is an amplifier to our natural,

Robert Breedlove (2:40:24.920)

this natural way of dealing with one another.

Lex Fridman (2:40:27.180)

But I wonder, and my thinking has evolved a lot on this,

Robert Breedlove (2:40:30.500)

that there's something below

Lex Fridman (2:40:32.380)

the way we're treating each other too, right?

Robert Breedlove (2:40:35.100)

We could say civilization sort of advances

Lex Fridman (2:40:37.800)

in the tools we make and the way we treat each other.

Robert Breedlove (2:40:40.100)

We tend to have better tools, better quality of life,

Lex Fridman (2:40:42.780)

and better morality, better quality of living,

Lex Fridman (2:40:46.260)

and ways of dealing with one another.

Lex Fridman (2:40:49.180)

And I think that when you corrupt the money,

Robert Breedlove (2:40:53.540)

that it really does push us the negative direction,

Lex Fridman (2:40:56.580)

pushes us away from, again, encouraging,

Robert Breedlove (2:41:02.300)

or magnifying scarcity artificially

Lex Fridman (2:41:05.580)

causes us to be more divisive.

Robert Breedlove (2:41:07.480)

When things are more divisive,

Lex Fridman (2:41:08.660)

we tend to be less civilized, less nuanced,

Robert Breedlove (2:41:11.620)

more black or white, or this or that,

Lex Fridman (2:41:14.480)

or you're this, or you're label A or label B.

Lex Fridman (2:41:17.980)

So I really think, and this is a harder one to unravel,

Lex Fridman (2:41:20.620)

but I think if we can fix the money, right,

Robert Breedlove (2:41:24.020)

which again is the base layer operating system

Lex Fridman (2:41:26.900)

for human moral action in the world,

Robert Breedlove (2:41:30.220)

that it has downstream effects.

Lex Fridman (2:41:32.580)

So we'd actually maybe start to treat each other

Robert Breedlove (2:41:34.440)

a little better on social media,

Lex Fridman (2:41:36.320)

despite the fact that it enables this faster communication.

Robert Breedlove (2:41:41.180)

That's interesting, so perhaps fixing social media

Lex Fridman (2:41:44.540)

as I've been thinking about is treating the symptom,

Robert Breedlove (2:41:48.500)

not the cause.

Lex Fridman (2:41:49.620)

Yeah, that is the Bitcoin rabbit hole in a nutshell,

Robert Breedlove (2:41:52.840)

is that they say fix the money, fix the world.

Lex Fridman (2:41:54.980)

You keep tracing these different social malaises

Robert Breedlove (2:41:58.780)

or technological difficulties, lack of innovation.

Lex Fridman (2:42:03.820)

Weinstein's entire Portal podcast,

Robert Breedlove (2:42:06.140)

something went wrong in the early 70s.

Lex Fridman (2:42:08.540)

We went off the gold standard in 1971,

Lex Fridman (2:42:11.220)

and there's a great website, wtfhappat1971.com,

Lex Fridman (2:42:15.980)

goes through this whole gamut of socioeconomic data

Robert Breedlove (2:42:18.400)

that's completely gone askew since the early 70s.

Lex Fridman (2:42:22.860)

Yeah, you had this whole video,

Lex Fridman (2:42:24.540)

what do you think about Eric Weinstein and Bitcoin

Lex Fridman (2:42:29.460)

and the gold standard?

Robert Breedlove (2:42:31.620)

Does he, I actually haven't heard him talk about his thesis

Lex Fridman (2:42:35.600)

about the 70s in connection to the,

Robert Breedlove (2:42:39.620)

going off of the gold standard.

Lex Fridman (2:42:42.060)

Yeah, what are your thoughts there?

Lex Fridman (2:42:43.540)

What are your thoughts about his general relationship

Lex Fridman (2:42:46.060)

with the Bitcoin idea and the community?

Robert Breedlove (2:42:49.740)

Yeah, the first exposure I had to Eric was his,

Lex Fridman (2:42:52.940)

I think it was his first episode with Peter Thiel,

Lex Fridman (2:42:55.420)

and they're going through that thesis

Lex Fridman (2:42:57.100)

that there's been this general institutional rot

Lex Fridman (2:43:00.980)

and suppression of innovation since the early 70s,

Lex Fridman (2:43:03.900)

and he's trying to identify what it is.

Robert Breedlove (2:43:05.980)

I don't think they ever pended on the money

Lex Fridman (2:43:09.300)

on going off the gold standard,

Lex Fridman (2:43:11.260)

but in recent interactions with Eric,

Lex Fridman (2:43:14.580)

I've interacted with him on Clubhouse.

Robert Breedlove (2:43:17.500)

We recently released an episode of the show

Lex Fridman (2:43:19.920)

I did with Chris Espley,

Lex Fridman (2:43:22.060)

and it was titled Dear Eric Weinstein.

Lex Fridman (2:43:24.260)

So we're going through his worldview

Robert Breedlove (2:43:26.760)

that he's expressed in the portal

Lex Fridman (2:43:27.980)

and tying it back to the money in different ways.

Lex Fridman (2:43:31.780)

And he's been, he's engaged.

Lex Fridman (2:43:33.300)

Eric retweeted the show.

Robert Breedlove (2:43:35.180)

We've exchanged some messages.

Lex Fridman (2:43:36.720)

He's been very open minded.

Robert Breedlove (2:43:38.340)

He's asked some really good questions.

Lex Fridman (2:43:40.420)

So I get the sense that he's approaching

Robert Breedlove (2:43:42.060)

this very wholeheartedly.

Lex Fridman (2:43:45.940)

He does bring with him his existing worldview

Lex Fridman (2:43:48.900)

and his existing theory.

Lex Fridman (2:43:50.260)

The one that really blew up was gauge theory.

Robert Breedlove (2:43:52.140)

They got really popular.

Lex Fridman (2:43:53.300)

I don't know a lot about gauge theory.

Robert Breedlove (2:43:54.820)

I actually messaged Eric and said,

Lex Fridman (2:43:56.680)

I want to learn more genuinely,

Robert Breedlove (2:43:58.100)

because he seems to be serious

Lex Fridman (2:44:01.280)

that that needs to be considered in the sphere of money.

Lex Fridman (2:44:03.980)

And so I want to learn more about it.

Lex Fridman (2:44:06.780)

But I think overall it's great.

Robert Breedlove (2:44:08.220)

It's great to see an intellectual heavyweight

Lex Fridman (2:44:10.860)

of his caliber gravitating towards Bitcoin.

Robert Breedlove (2:44:14.700)

Yeah, he has some gauge theoretic conceptions

Lex Fridman (2:44:18.980)

about the world broadly, but also about economics,

Robert Breedlove (2:44:23.900)

which ultimately boils down to just a set of mathematics,

Lex Fridman (2:44:27.140)

which allows you to more effectively reason about the world.

Lex Fridman (2:44:30.740)

And he has a certain set of views there.

Lex Fridman (2:44:33.700)

So it's fascinating to see him grapple with it.

Robert Breedlove (2:44:37.140)

I think he's also kind of actually kind of like all of us,

Lex Fridman (2:44:42.360)

grappling with the idea of what is Bitcoin in this world.

Robert Breedlove (2:44:45.800)

It's a very young technology,

Lex Fridman (2:44:47.700)

and it's unclear exactly how the ideas of the past

Robert Breedlove (2:44:52.860)

fit with it and integrate, how the two integrate together.

Lex Fridman (2:44:57.480)

And so it's interesting to explore,

Robert Breedlove (2:44:59.900)

not just Bitcoin in the particular.

Lex Fridman (2:45:01.460)

So for me, like what I've always saw Bitcoin as

Robert Breedlove (2:45:06.820)

from the beginning, from a narrow worldview

Lex Fridman (2:45:11.060)

is computer science, which is where I come from.

Lex Fridman (2:45:14.500)

And so I wasn't almost aware

Lex Fridman (2:45:16.740)

in the social, political, financial aspects of Bitcoin.

Lex Fridman (2:45:21.660)

But now I see that there's not just power,

Lex Fridman (2:45:26.440)

but there's fascinating ideas to explore on that side

Robert Breedlove (2:45:29.900)

of things, not just the computer science,

Lex Fridman (2:45:31.500)

not just the technical details,

Lex Fridman (2:45:33.820)

but the political, the socioeconomic, the philosophical.

Lex Fridman (2:45:39.580)

That's where I find all the fascination in the world,

Robert Breedlove (2:45:43.000)

frankly.

Lex Fridman (2:45:45.180)

One other thing about Weinstein and intellectuals

Robert Breedlove (2:45:49.500)

more generally that are skeptical of Bitcoin,

Lex Fridman (2:45:52.340)

I would challenge them to read the book,

Robert Breedlove (2:45:54.340)

Human Action, written by Mises.

Lex Fridman (2:45:57.500)

I think in 1949, he published the English version.

Robert Breedlove (2:46:01.380)

It's essentially the Bible of Austrian economics.

Lex Fridman (2:46:04.820)

And I think Austrian economics is a noticeable gap

Robert Breedlove (2:46:09.620)

in most modern intellectuals worldviews,

Lex Fridman (2:46:13.760)

that it's not taught in school.

Robert Breedlove (2:46:15.240)

I mean, I have a master's degree in accounting and finance,

Lex Fridman (2:46:17.540)

studied a lot of economics in school.

Robert Breedlove (2:46:19.260)

There's not one peep of Austrian econ.

Lex Fridman (2:46:21.340)

The least we'd love talking about all the degrees he has.

Robert Breedlove (2:46:26.500)

I was a CPA.

Lex Fridman (2:46:27.860)

But that curriculum that we get in college

Robert Breedlove (2:46:35.540)

is noticeably deficient in Austrian economics.

Lex Fridman (2:46:38.660)

And I think there's a reason why, right?

Robert Breedlove (2:46:40.100)

It's heavily government influenced.

Lex Fridman (2:46:45.220)

Again, master's degree in accounting,

Robert Breedlove (2:46:46.640)

they never taught me about what money is

Lex Fridman (2:46:48.680)

or where money comes from.

Robert Breedlove (2:46:49.980)

All you learn is that the central bank issues money

Lex Fridman (2:46:53.820)

and the central bank takes money away.

Lex Fridman (2:46:55.980)

So it's conceived of in the textbooks

Lex Fridman (2:46:58.780)

quite literally as God, right?

Robert Breedlove (2:47:00.580)

An entity that suffers no opportunity costs,

Lex Fridman (2:47:03.720)

that basically is the foundation

Robert Breedlove (2:47:06.780)

of the entire Keynesian worldview

Lex Fridman (2:47:09.100)

that you're taught in economics.

Lex Fridman (2:47:10.900)

And Austrian economics is the opposite

Lex Fridman (2:47:14.740)

end of the spectrum of that, right?

Robert Breedlove (2:47:16.060)

It's actually the culmination,

Lex Fridman (2:47:18.420)

which economics is the youngest science in the world,

Robert Breedlove (2:47:20.740)

by the way.

Lex Fridman (2:47:21.580)

So it is kind of the front,

Robert Breedlove (2:47:24.960)

it's the frontiers of science in many ways,

Lex Fridman (2:47:27.000)

like to actually, when I say praxeology,

Robert Breedlove (2:47:29.500)

many people have never even heard of that.

Lex Fridman (2:47:31.300)

But it's something, it's an a priori study

Robert Breedlove (2:47:35.860)

equivalent to something like mathematics,

Lex Fridman (2:47:37.360)

that you're building things from first principles

Robert Breedlove (2:47:39.560)

to reason about economic reality.

Lex Fridman (2:47:42.400)

And I think that book, it's a very difficult book

Robert Breedlove (2:47:46.380)

written by Mises, 1200 pages, translated from German.

Lex Fridman (2:47:49.780)

The way he wields English is fascinating

Lex Fridman (2:47:52.180)

and terrifying all at the same time.

Lex Fridman (2:47:54.900)

It'd probably take you six months to read it

Robert Breedlove (2:47:56.540)

if you read it daily, seriously.

Lex Fridman (2:47:58.100)

Like it's a beast of a book.

Lex Fridman (2:48:00.460)

But that will plug the gap, I think in most,

Lex Fridman (2:48:04.380)

any intellectual that's skeptical about Bitcoin,

Robert Breedlove (2:48:06.140)

I think that will plug the gap that's necessary

Lex Fridman (2:48:08.000)

for you to see it in a new light.

Robert Breedlove (2:48:10.340)

Well, I'll take that as a challenge.

Lex Fridman (2:48:12.620)

Now that we took a little bit of a break,

Robert Breedlove (2:48:14.460)

ate some good Texas brisket, thank you for that,

Lex Fridman (2:48:16.480)

by the way, for passing over.

Robert Breedlove (2:48:17.700)

Quite welcome.

Lex Fridman (2:48:18.900)

Let me ask the ridiculous question.

Robert Breedlove (2:48:21.560)

At the core of the idea of Bitcoin,

Lex Fridman (2:48:24.180)

is this guy or this entity named Satoshi Nakamoto?

Lex Fridman (2:48:28.360)

So the ridiculous question is, who is Satoshi Nakamoto?

Lex Fridman (2:48:32.220)

And first of all, is it you?

Robert Breedlove (2:48:35.120)

It's not me.

Lex Fridman (2:48:37.420)

I wish.

Lex Fridman (2:48:38.260)

And is this an interesting question?

Lex Fridman (2:48:41.780)

Or is it just something about our human nature

Lex Fridman (2:48:43.460)

that wants to, that always tends towards mystery?

Lex Fridman (2:48:47.140)

Well, as we've touched on a bit today,

Robert Breedlove (2:48:51.620)

you know, mythology, in my opinion,

Lex Fridman (2:48:53.820)

is something that is intrinsic to how we see the world

Robert Breedlove (2:48:57.380)

in a lot of ways.

Lex Fridman (2:48:58.220)

Like it's how, it's kind of the structure

Robert Breedlove (2:49:02.240)

by which we build these useful fictions.

Lex Fridman (2:49:05.460)

And so in that way, you could just say that

Robert Breedlove (2:49:08.260)

Satoshi is the godhead of Bitcoin, effectively.

Lex Fridman (2:49:11.840)

And I think a compelling argument could be made

Robert Breedlove (2:49:15.560)

that his disappearance is what really solidifies

Lex Fridman (2:49:18.020)

Bitcoin's decentralization.

Robert Breedlove (2:49:20.140)

Because if there were one individual to personally vilify

Lex Fridman (2:49:25.460)

or denigrate or attack, you know, to disparage

Robert Breedlove (2:49:30.380)

or question the motives of, you know,

Lex Fridman (2:49:33.560)

if he's out on the Hollywood Hills partying,

Robert Breedlove (2:49:37.780)

everyone knows he's got a million Bitcoin, you know,

Lex Fridman (2:49:40.500)

it would just kind of tarnish the entire project

Robert Breedlove (2:49:43.500)

in a lot of ways.

Lex Fridman (2:49:44.340)

But the fact that on that theme, something for nothing,

Robert Breedlove (2:49:48.100)

this guy actually gave humanity something for nothing.

Lex Fridman (2:49:51.140)

And it appears that he didn't profit in any way.

Robert Breedlove (2:49:56.780)

He, she, or they.

Lex Fridman (2:49:59.420)

I actually heard recently that he identified as a he

Robert Breedlove (2:50:01.820)

in some of his communications.

Lex Fridman (2:50:03.100)

So it sounds like it is a he.

Lex Fridman (2:50:04.700)

So like his communication is being like studied,

Lex Fridman (2:50:11.060)

like almost like exactly as if he is a religious.

Robert Breedlove (2:50:14.460)

That's right.

Lex Fridman (2:50:15.580)

Like a prophet.

Robert Breedlove (2:50:18.420)

It's fascinating to imagine that he's still alive

Lex Fridman (2:50:24.420)

and living in this world.

Lex Fridman (2:50:27.260)

And it's even more fascinating to imagine

Lex Fridman (2:50:29.140)

that he's perhaps participating in the Bitcoin community

Robert Breedlove (2:50:32.220)

because I mean, that takes a special human being

Lex Fridman (2:50:36.780)

to out of principle do that, to do, to remain anonymous.

Robert Breedlove (2:50:41.420)

That's very much the George Washington.

Lex Fridman (2:50:43.460)

Yeah, I always wonder like how many people are like that?

Robert Breedlove (2:50:46.480)

There's a cliche that like absolute power corrupts,

Lex Fridman (2:50:48.900)

absolutely, like power corrupts.

Lex Fridman (2:50:51.380)

But it seems like the progress of humanity depends

Lex Fridman (2:50:55.000)

on the people whom power doesn't corrupt.

Lex Fridman (2:50:57.900)

And it's enough to have just a small selection of those.

Lex Fridman (2:51:04.340)

And even if most of us are too weak, we give into power.

Robert Breedlove (2:51:09.500)

If given the chance, all it takes is a few.

Lex Fridman (2:51:14.020)

That's, I've never thought of it like that,

Lex Fridman (2:51:15.540)

but Marcus Aurelius immediately came to mind.

Lex Fridman (2:51:18.300)

You know, the guy that he had the keys to the kingdom

Lex Fridman (2:51:21.780)

and he apparently adhered to the stoic virtues

Lex Fridman (2:51:26.300)

until the end, but yeah, I agree with Satoshi.

Robert Breedlove (2:51:30.140)

The other thing that's interesting is he would be by far

Lex Fridman (2:51:35.500)

the most wealthy person in the world on a liquid asset basis

Robert Breedlove (2:51:39.980)

because he has a million Bitcoin,

Lex Fridman (2:51:42.220)

which is 60 billion liquid net worth at current prices.

Lex Fridman (2:51:47.860)

So if he is still alive and just operating in the world,

Lex Fridman (2:51:51.620)

he is daily and moment to moment resisting massive

Robert Breedlove (2:51:56.180)

incentives to go and just be the richest guy in the world.

Lex Fridman (2:52:01.180)

He's the ultimate hodler.

Robert Breedlove (2:52:02.740)

Yeah.

Lex Fridman (2:52:03.580)

Yeah.

Robert Breedlove (2:52:05.020)

I mean, so it's, I mean, it's turning down

Lex Fridman (2:52:07.740)

not just financial success, but also fame.

Robert Breedlove (2:52:12.300)

I mean, fame is another drug.

Lex Fridman (2:52:14.140)

It's kind of power, but it's in itself is also a drug,

Robert Breedlove (2:52:17.340)

especially in this modern society, in this attention.

Lex Fridman (2:52:20.540)

And he would have both.

Robert Breedlove (2:52:21.660)

He would have both.

Lex Fridman (2:52:22.900)

It's fun to imagine who it could be.

Robert Breedlove (2:52:25.780)

It's fascinating if it's somebody like you

Lex Fridman (2:52:27.900)

or somebody like Elon or somebody like that.

Robert Breedlove (2:52:30.580)

That's fascinating to think about.

Lex Fridman (2:52:31.900)

I think Elon would be hilarious if he came out

Lex Fridman (2:52:34.620)

and he was Satoshi and be like,

Lex Fridman (2:52:36.860)

hey guys, I know I'm already the richest guy in the world,

Lex Fridman (2:52:38.900)

but I gotta go ahead and double my lead here.

Lex Fridman (2:52:42.460)

What do you make of Elon Musk investing with Tesla,

Robert Breedlove (2:52:46.420)

investing in Bitcoin and maybe broaden it out

Lex Fridman (2:52:50.380)

in some of these other, you know,

Robert Breedlove (2:52:54.660)

big billionaires, but also people tied to major companies

Lex Fridman (2:52:57.980)

investing in Bitcoin?

Robert Breedlove (2:52:59.900)

Yeah, I think Michael Saylor really led the charge on that.

Lex Fridman (2:53:04.900)

He's the CEO of MicroStrategy

Robert Breedlove (2:53:06.460)

that I think they've acquired upwards

Lex Fridman (2:53:09.220)

of $2 billion in Bitcoin now.

Robert Breedlove (2:53:11.020)

Started acquiring August, maybe of 2020.

Lex Fridman (2:53:15.940)

And he's, you know, personally bought a lot of it.

Robert Breedlove (2:53:19.020)

He bought a lot as a treasury reserve asset

Lex Fridman (2:53:22.500)

for his company, MicroStrategy.

Robert Breedlove (2:53:24.140)

Then they leveraged up on a convertible note

Lex Fridman (2:53:27.460)

and bought more.

Lex Fridman (2:53:28.300)

So he's really gone, really leading the charge

Lex Fridman (2:53:32.340)

in this Bitcoin institutional adoption.

Robert Breedlove (2:53:35.940)

Your conversation with him is a really interesting one.

Lex Fridman (2:53:38.100)

Your series of, I mean, series of episodes I suppose,

Lex Fridman (2:53:41.780)

but it's only a couple of conversations, I guess.

Lex Fridman (2:53:44.220)

Yeah, we recorded twice, five and a half hours each.

Lex Fridman (2:53:48.180)

So it's about 11 hours of content.

Lex Fridman (2:53:50.140)

Yeah, thank you.

Robert Breedlove (2:53:50.980)

A lot of people have said that it's the best

Lex Fridman (2:53:55.140)

first principle thing they've ever seen on Bitcoin,

Robert Breedlove (2:53:57.300)

which I take no credit for that at all.

Lex Fridman (2:53:59.300)

I mean, I just sat down with a guy and unleashed him.

Robert Breedlove (2:54:02.540)

He's just a beast.

Lex Fridman (2:54:04.020)

Yeah, but it's fascinating that his longterm vision with it.

Robert Breedlove (2:54:11.300)

I mean, I'm not sure I'm all philosophically bought in,

Lex Fridman (2:54:15.500)

but if he's right, if this set of ideas are as powerful

Robert Breedlove (2:54:20.500)

as he describes, as you described,

Lex Fridman (2:54:24.140)

that this would change the world,

Robert Breedlove (2:54:26.700)

which as you say, it's funny that a company

Lex Fridman (2:54:28.700)

like MicroStrategy might be the company

Robert Breedlove (2:54:34.540)

that has the biggest macro effect

Lex Fridman (2:54:38.060)

on our economy and our world.

Robert Breedlove (2:54:40.180)

Yeah, the conversation reshaped my worldview a lot too,

Lex Fridman (2:54:44.420)

because he framed money as energy,

Robert Breedlove (2:54:48.100)

which I had often thought of money as time.

Lex Fridman (2:54:50.940)

And it explored those connections a lot in my writing,

Lex Fridman (2:54:53.460)

but looking at it as energy, and then his supposition

Lex Fridman (2:54:57.300)

that the purpose of life is to basically channel energy

Robert Breedlove (2:55:01.980)

across space and time.

Lex Fridman (2:55:03.140)

So we're just trying to figure out how to channel

Robert Breedlove (2:55:05.100)

more energy across space and time

Lex Fridman (2:55:07.100)

toward the satisfaction of aims.

Lex Fridman (2:55:09.940)

And his definition, or his answer to that question,

Lex Fridman (2:55:12.660)

what is money, is that money is the highest form of energy

Robert Breedlove (2:55:15.300)

a human being can channel.

Lex Fridman (2:55:17.140)

So it's a claim to all other forms of energy

Robert Breedlove (2:55:19.420)

we can manifest in the world.

Lex Fridman (2:55:20.780)

And that just completely reshaped how I see it,

Robert Breedlove (2:55:24.900)

brought in this whole other side

Lex Fridman (2:55:26.300)

to my intellectual explorations of money.

Lex Fridman (2:55:30.820)

Can you elaborate on that a little bit?

Lex Fridman (2:55:32.180)

So I understand money is time,

Robert Breedlove (2:55:34.300)

which in itself is a really powerful idea.

Lex Fridman (2:55:37.100)

But money is energy, and channeling energy,

Lex Fridman (2:55:39.740)

can you break that apart?

Lex Fridman (2:55:40.700)

Yeah, so I guess I definitely have to check out

Robert Breedlove (2:55:44.980)

the whole series to really get his perspective,

Lex Fridman (2:55:46.980)

but I'll do my best to condense it.

Robert Breedlove (2:55:51.300)

Life itself, all forms of life are,

Lex Fridman (2:55:54.980)

they're dependent on energy, right?

Robert Breedlove (2:55:56.500)

Energy fuels everything, fuels life in action and motion

Lex Fridman (2:56:00.500)

and all of that.

Lex Fridman (2:56:02.340)

And we could say that maybe like a plant

Lex Fridman (2:56:06.180)

is harnessing solar energy

Lex Fridman (2:56:08.980)

and then reallocating that into growth.

Lex Fridman (2:56:11.820)

So its aim is to grow towards the sun, right?

Lex Fridman (2:56:15.220)

So it's allocating energy towards its goal

Lex Fridman (2:56:17.620)

of harnessing more solar energy kind of thing.

Robert Breedlove (2:56:20.740)

So, and humans too have evolved

Lex Fridman (2:56:27.220)

to figure out how to harness energy in different ways

Robert Breedlove (2:56:30.580)

to satisfy higher and more complicated aims.

Lex Fridman (2:56:35.180)

So the original energy network

Lex Fridman (2:56:38.700)

that he referenced was fire, right?

Lex Fridman (2:56:41.220)

We actually learned to wield fire as a tool in and of itself.

Lex Fridman (2:56:45.740)

So not only are we learning to channel energy,

Lex Fridman (2:56:48.140)

but we're actually learning how to isolate energy

Robert Breedlove (2:56:51.380)

as a tool in and of itself.

Lex Fridman (2:56:53.820)

And so we went into that,

Lex Fridman (2:56:55.020)

how harnessing fire had changed human beings.

Lex Fridman (2:56:59.700)

And actually, this is one of the earliest examples too

Robert Breedlove (2:57:04.140)

of a coevolution between tool and our biology,

Lex Fridman (2:57:07.660)

because when we developed fire, we developed cooking.

Lex Fridman (2:57:11.580)

And cooking is, you can kind of think of it

Lex Fridman (2:57:13.180)

as pre digestion in a way.

Robert Breedlove (2:57:14.540)

We're liberating these macronutrients

Lex Fridman (2:57:16.300)

or making things that otherwise

Robert Breedlove (2:57:18.420)

would not be digestible, edible.

Lex Fridman (2:57:22.020)

And it increases the efficiency

Robert Breedlove (2:57:23.340)

by which we extract nutrients from food.

Lex Fridman (2:57:26.220)

That's what cooking does.

Lex Fridman (2:57:27.540)

So when we figured out cooking,

Lex Fridman (2:57:29.900)

we liberated all these digestive resources

Robert Breedlove (2:57:33.660)

that were reallocated towards higher cognitive development.

Lex Fridman (2:57:36.660)

So there's this evolutionary path

Robert Breedlove (2:57:39.620)

between figuring out fire and us becoming smarter,

Lex Fridman (2:57:42.820)

which is interesting.

Robert Breedlove (2:57:45.900)

Some other early examples he gave,

Lex Fridman (2:57:47.740)

he went into were missiles and hydraulics.

Lex Fridman (2:57:51.700)

So missiles being, we learned to hunt at a distance.

Lex Fridman (2:57:56.660)

We can't bring down a wooly mammoth,

Robert Breedlove (2:57:58.900)

maybe with spears and up close and personal force,

Lex Fridman (2:58:03.900)

but we could with spears and javelins and slings and whatnot.

Lex Fridman (2:58:07.500)

And then he went into how we've used water

Lex Fridman (2:58:11.500)

to channel hydraulic energy.

Lex Fridman (2:58:12.900)

So we can basically overcome gravity.

Lex Fridman (2:58:14.540)

We can move, there's theories that the pyramids

Robert Breedlove (2:58:19.940)

were constructed using, the blocks were moved

Lex Fridman (2:58:22.300)

using hydraulic energy or using water.

Robert Breedlove (2:58:25.220)

Clearly we use like cargo ships and whatnot

Lex Fridman (2:58:27.660)

to move things much more efficiently across water

Robert Breedlove (2:58:29.900)

than we could the land.

Lex Fridman (2:58:32.140)

So his whole view is how we keep figuring out better ways

Lex Fridman (2:58:37.300)

and more efficient ways to harness energy and channel it.

Lex Fridman (2:58:40.300)

And in that perspective, money has always represented

Robert Breedlove (2:58:46.580)

a claim on all other forms of energy.

Lex Fridman (2:58:48.740)

So whatever energy couldn't be channeled

Robert Breedlove (2:58:51.660)

towards something useful in the economy historically

Lex Fridman (2:58:54.580)

would go into gold mining.

Lex Fridman (2:58:55.980)

So gold became this residual, this economic,

Lex Fridman (2:58:59.340)

this token of the excess energy created

Robert Breedlove (2:59:03.860)

by the market economy.

Lex Fridman (2:59:05.300)

And then you could take that token of energy

Lex Fridman (2:59:07.220)

and use it to redeem for any other form of energy

Lex Fridman (2:59:10.420)

or any of the products of energy itself.

Lex Fridman (2:59:13.340)

So it's, I guess it's my best approximation of it.

Lex Fridman (2:59:17.820)

And it just really shattered my worldview again,

Robert Breedlove (2:59:22.060)

because I'd always thought about it as time.

Lex Fridman (2:59:23.540)

Like we spend time sacrificing to obtain money

Robert Breedlove (2:59:26.380)

that we then redeem for commencement sacrifices

Lex Fridman (2:59:28.420)

from others, but I'd never considered it purely as energy.

Lex Fridman (2:59:32.420)

And then it also ties back into gold,

Lex Fridman (2:59:35.260)

where there was an energy expenditure necessary

Robert Breedlove (2:59:38.940)

to obtain gold.

Lex Fridman (2:59:40.260)

So there's a proof of work associated with obtaining gold

Lex Fridman (2:59:43.700)

that protected its market value, right?

Lex Fridman (2:59:46.100)

So you had to expend, again,

Robert Breedlove (2:59:47.780)

if market value of gold's 2000 an ounce,

Lex Fridman (2:59:50.220)

you had to expend 1900 an ounce mining.

Lex Fridman (2:59:53.180)

So it kept producers honest in a way.

Lex Fridman (2:59:56.580)

So do you think something like proof of stake

Robert Breedlove (2:59:58.980)

that's more about reputation

Lex Fridman (30:01.460)

to create more capital,

Robert Breedlove (30:03.640)

which capital is very simply a way of mitigating uncertainty.

Lex Fridman (30:09.540)

So this is why you might have like a stash of food

Robert Breedlove (30:12.340)

in case the power goes out or a generator,

Lex Fridman (30:14.620)

like it helps you overcome uncertainty over time.

Lex Fridman (30:17.780)

But uncertainty is also where all the sweetness of life is.

Lex Fridman (30:21.420)

So there's gotta be this balance

Robert Breedlove (30:22.660)

with one foot in, one foot out.

Lex Fridman (30:25.300)

So human society is this kind of bubble of order

Robert Breedlove (30:27.500)

that we've constructed and slowly expanding,

Lex Fridman (30:30.460)

but at the edges, you're always going to have that chaos,

Robert Breedlove (30:33.180)

that volatility, and that the entrepreneurs

Lex Fridman (30:36.180)

are kind of like jumping into that chaos

Lex Fridman (30:39.460)

and some of them die and some of them succeed.

Lex Fridman (30:42.000)

And so like, if you wanna grow this bubble of order,

Robert Breedlove (30:46.380)

you have to be embracing the volatility at the edges.

Lex Fridman (30:51.380)

Yes.

Lex Fridman (30:53.400)

And reverence for entrepreneurship

Lex Fridman (30:55.100)

because these are the people putting their neck out,

Lex Fridman (30:58.940)

so to speak, risking themselves.

Lex Fridman (31:01.260)

And they're gonna contribute to society, by the way,

Robert Breedlove (31:03.220)

whether they go up in flames or not.

Lex Fridman (31:05.100)

If they go up in flames,

Robert Breedlove (31:06.340)

society has witnessed their experience

Lex Fridman (31:08.560)

as something not to do or something that doesn't work

Robert Breedlove (31:10.660)

in a particular time and place.

Lex Fridman (31:12.380)

So that you could say them going up in flames

Robert Breedlove (31:14.780)

is a way of enlightening the rest of us.

Lex Fridman (31:16.780)

Or if they figure something out,

Robert Breedlove (31:18.980)

Steve Jobs creates the iPhone, changes the world forever.

Lex Fridman (31:22.780)

So enlightening the rest of us, okay.

Lex Fridman (31:25.780)

And Taleb would say.

Lex Fridman (31:26.900)

The fire of their failure, okay.

Robert Breedlove (31:28.580)

Yeah, exactly.

Lex Fridman (31:30.020)

Taleb would say individual fragility

Robert Breedlove (31:35.020)

is inseparable from ensemble anti fragility.

Lex Fridman (31:38.580)

So this means that, again,

Robert Breedlove (31:40.620)

every time that entrepreneur goes up in flames

Lex Fridman (31:42.760)

or say a restaurant goes out of business,

Robert Breedlove (31:46.020)

when a restaurant goes out of business,

Lex Fridman (31:47.380)

that particular cuisine strategy they were implementing

Robert Breedlove (31:50.220)

in that particular time and place,

Lex Fridman (31:51.580)

that's a signal to all the other restaurants in the area

Robert Breedlove (31:53.500)

that that doesn't work.

Lex Fridman (31:54.900)

So restaurant food improves from bankruptcy to bankruptcy.

Lex Fridman (31:59.660)

So it's this death of the individual components

Lex Fridman (32:02.420)

that contributes to the growth of the ensemble.

Robert Breedlove (32:05.460)

As a small aside, maybe you can guide me through it.

Lex Fridman (32:07.860)

I don't know if you're paying attention,

Lex Fridman (32:09.300)

but there was some chaos around Taleb

Lex Fridman (32:13.780)

and the Bitcoin community.

Robert Breedlove (32:15.580)

I wasn't quite paying attention,

Lex Fridman (32:17.960)

but from my outsider's perspective,

Robert Breedlove (32:20.220)

I thought it seemed Taleb was a supporter of Bitcoin.

Lex Fridman (32:24.500)

And then a lot of people were very upset about something.

Robert Breedlove (32:26.900)

I'm sorry if I don't know the details,

Lex Fridman (32:28.260)

but can you pull out some profound philosophical ideas

Lex Fridman (32:33.020)

from the disagreement of the chaos?

Lex Fridman (32:34.860)

I admittedly don't know too much about it either.

Robert Breedlove (32:37.940)

I'm a big fan of his writing.

Lex Fridman (32:41.300)

He's always been a little different in person.

Robert Breedlove (32:45.780)

Like I actually, he signed one of my books.

Lex Fridman (32:47.500)

I met him in person.

Robert Breedlove (32:48.340)

He's just, he's got a very abrasive personality.

Lex Fridman (32:50.660)

He's kind of known for it.

Robert Breedlove (32:51.580)

It's not, I don't think I'm passing any judgment here.

Lex Fridman (32:54.140)

He sort of embraces it.

Robert Breedlove (32:55.540)

Yeah.

Lex Fridman (32:56.380)

But he had written the forward

Robert Breedlove (32:58.980)

to a really important book in Bitcoin

Lex Fridman (33:00.680)

called the Bitcoin Standard for safety in a moose.

Lex Fridman (33:03.800)

And then I think they had a little Twitter beef

Lex Fridman (33:06.900)

because safety is very much against COVID mask

Lex Fridman (33:10.880)

and state intervention,

Lex Fridman (33:12.700)

whereas Taleb's on the other side of the fence.

Lex Fridman (33:15.340)

And so, and then after that beef,

Lex Fridman (33:17.900)

Taleb came out against Bitcoiners saying,

Robert Breedlove (33:19.580)

oh, Bitcoiners are crazy and wrong.

Lex Fridman (33:21.840)

I think the great mask debate of the 2020

Robert Breedlove (33:24.700)

will probably be the thing

Lex Fridman (33:25.820)

that ultimately leads to World War III.

Robert Breedlove (33:28.380)

I've been very surprised how tense, how much like division

Lex Fridman (33:33.380)

this one little arguably silly thing has led to.

Robert Breedlove (33:39.140)

I think a lot of people sort of project their,

Lex Fridman (33:41.580)

like, it's almost like not wearing a mask

Robert Breedlove (33:44.020)

is a statement of sovereignty, of freedom,

Lex Fridman (33:46.500)

of like saying fuck you to the man,

Robert Breedlove (33:48.860)

the government, the centralized power,

Lex Fridman (33:50.900)

or the dishonesty or the, in the scientific community,

Robert Breedlove (33:55.180)

all those kinds of things.

Lex Fridman (33:56.260)

And then wearing a mask is a sort of kind of signaling

Robert Breedlove (33:59.520)

of various kind of social aspects.

Lex Fridman (34:03.600)

I don't know.

Robert Breedlove (34:04.440)

I'm not paying attention to it.

Lex Fridman (34:05.500)

I actually tuned out.

Robert Breedlove (34:06.820)

I was part of a group of scientists

Lex Fridman (34:08.480)

that were looking into like, do masks work?

Robert Breedlove (34:10.580)

This very interesting question.

Lex Fridman (34:11.980)

To me, it was an interesting question.

Robert Breedlove (34:13.880)

I sort of roll in to ask that very interesting question

Lex Fridman (34:17.580)

because I think it is an interesting scientific question.

Lex Fridman (34:20.500)

But then I quickly realized that just as I was doing this,

Lex Fridman (34:23.820)

like scientific exploration of this very interesting question

Robert Breedlove (34:27.560)

about Viron particles, like what kind of things,

Lex Fridman (34:30.300)

like from a scientific perspective,

Lex Fridman (34:32.300)

how do we prevent the spread of a pandemic?

Lex Fridman (34:34.400)

Forget COVID, any pandemic, super deadly or not deadly.

Robert Breedlove (34:38.020)

Like there's tools, there's testing, there's masks,

Lex Fridman (34:40.660)

there's all these tools, how well do they work?

Lex Fridman (34:43.220)

And then I realized, you know, in April or so,

Lex Fridman (34:46.740)

it became a tool of politics, a tool of philosophy.

Lex Fridman (34:49.980)

And that's when I sort of pulled out.

Lex Fridman (34:51.900)

So it's fascinating.

Robert Breedlove (34:52.740)

I think it's a canvas on which people project

Lex Fridman (34:56.740)

their emotions and I guess Tillam got caught up

Robert Breedlove (34:59.900)

in that kind of, so there's nothing fundamental,

Lex Fridman (35:02.480)

I suppose, to their disagreement.

Robert Breedlove (35:04.540)

Not that I'm aware of, but he is, you know,

Lex Fridman (35:07.880)

he's written some about in his books,

Robert Breedlove (35:11.340)

the problem with centralization.

Lex Fridman (35:13.220)

I mean, a lot of his writing addresses that

Lex Fridman (35:15.860)

and he actually points to, I think Switzerland

Lex Fridman (35:18.620)

is the best government in the world

Robert Breedlove (35:20.300)

because it's decentralized.

Lex Fridman (35:21.700)

So there's that, I don't think he has any,

Robert Breedlove (35:26.900)

I'm not to speak for him, but I don't think he's voiced

Lex Fridman (35:30.700)

any specific critiques on Bitcoin per se.

Robert Breedlove (35:34.640)

Could be wrong about that.

Lex Fridman (35:35.740)

It's just maybe his flavorful language

Lex Fridman (35:37.820)

and the way he likes to communicate.

Lex Fridman (35:39.580)

And the other theory is that maybe he's playing 4D chess

Lex Fridman (35:42.300)

and having a Twitter boating accident, you know.

Lex Fridman (35:44.580)

So I don't believe in Bitcoin, I've sold all my Bitcoin.

Robert Breedlove (35:48.140)

Oh, I see.

Lex Fridman (35:48.980)

Yeah.

Robert Breedlove (35:49.820)

Sorry, the boating accident in Bitcoin is this,

Lex Fridman (35:55.020)

I guess it's proverbial by this point,

Robert Breedlove (35:56.740)

where it's the way you lose your Bitcoin.

Lex Fridman (35:59.360)

So if someone comes after you and says,

Robert Breedlove (36:00.880)

hey, you know, whether it's a government

Lex Fridman (36:02.880)

or an individual's coming after you saying,

Robert Breedlove (36:04.200)

give me all your Bitcoin or pay these taxes in Bitcoin,

Lex Fridman (36:06.780)

you go, oh, I had a boating accident and lost them all.

Robert Breedlove (36:09.060)

Lost them all.

Lex Fridman (36:09.900)

So, yeah.

Lex Fridman (36:13.380)

But back to the fundamental nature of space time.

Lex Fridman (36:16.500)

Let me ask you, because we're kind of left at,

Robert Breedlove (36:20.180)

I'd like to go back to this idea of,

Lex Fridman (36:24.160)

that you said that everything we think, say,

Robert Breedlove (36:26.520)

or do occurs within the bounds of space time.

Lex Fridman (36:31.180)

So first of all, maybe you can comment on

Lex Fridman (36:33.580)

what do you mean in this context about space time,

Lex Fridman (36:37.140)

but also about the nature of truth.

Lex Fridman (36:40.660)

Like how much of all of this is knowable?

Lex Fridman (36:43.480)

How much of this is accessible to us humans?

Lex Fridman (36:46.400)

How much uncertainty, like what we're talking about,

Lex Fridman (36:49.180)

is there in the world?

Robert Breedlove (36:50.720)

Are you, do you fall in a place

Lex Fridman (36:52.300)

where we can reason deeply about this world

Lex Fridman (36:56.060)

and it's knowable, or is it mostly chaos

Lex Fridman (36:58.540)

and we're just holding on for dear life?

Robert Breedlove (37:01.380)

Yeah, I think I said that all action occurs

Lex Fridman (37:04.220)

within the bounds of space time.

Robert Breedlove (37:05.560)

The other thing, everything we say, do, or make,

Lex Fridman (37:08.200)

the other thing is that everything we say, do, or make

Robert Breedlove (37:10.380)

starts out as an idea.

Lex Fridman (37:12.460)

So there's this concept of universal Darwinism,

Robert Breedlove (37:15.520)

which basically applies Darwinian principles,

Lex Fridman (37:20.060)

but outside of the biological sphere.

Lex Fridman (37:21.980)

So we could say that this kind of gets into

Lex Fridman (37:23.820)

Richard Dawkins memetics, that even ideas are competing,

Robert Breedlove (37:27.220)

reproducing, recombining.

Lex Fridman (37:29.180)

That idea is so powerful, by the way.

Robert Breedlove (37:30.860)

I don't think it's been understood fully.

Lex Fridman (37:33.900)

I think in the digital, in the 21st century,

Robert Breedlove (37:38.940)

in the digital world, from my perspective

Lex Fridman (37:40.580)

in artificial intelligence,

Robert Breedlove (37:42.540)

there's yet to be some profound things

Lex Fridman (37:44.500)

to be discovered about this whole construct.

Robert Breedlove (37:47.220)

Agreed completely.

Lex Fridman (37:48.860)

It's been called an acid, actually,

Robert Breedlove (37:51.540)

in that it strips away all of the noninformational

Lex Fridman (37:55.580)

components of something, just strips it down

Robert Breedlove (37:57.140)

to its bare bones.

Lex Fridman (37:59.140)

I have a quote in here somewhere about that, but.

Lex Fridman (38:02.140)

I'm sorry, which is called an acid?

Lex Fridman (38:03.500)

The ideas?

Robert Breedlove (38:04.340)

The universal Darwinism.

Lex Fridman (38:05.860)

Darwinism applied broadly, outside of the.

Robert Breedlove (38:08.100)

Applied broadly, and I'll condition all of this

Lex Fridman (38:12.740)

by saying that a lot, most of my thinking

Robert Breedlove (38:14.540)

is shaped by a book I read recently

Lex Fridman (38:16.300)

called The Case Against Reality,

Robert Breedlove (38:19.340)

which introduced me to this concept,

Lex Fridman (38:20.660)

but it tied into Darwinism that I've used

Robert Breedlove (38:23.380)

more broadly in the past, looking at things

Lex Fridman (38:24.760)

like money and economics.

Lex Fridman (38:26.340)

So the book, The Case Against Reality,

Lex Fridman (38:28.640)

by Donald Hoffman, he has a quote in the book

Robert Breedlove (38:32.860)

that describes universal Darwinism.

Lex Fridman (38:35.740)

It says, quote, universal Darwinism can,

Robert Breedlove (38:37.640)

without risk of refuting itself,

Lex Fridman (38:39.340)

address our key question.

Lex Fridman (38:41.500)

Does natural selection favor true perceptions?

Lex Fridman (38:44.820)

If the answer happens to be no,

Robert Breedlove (38:46.780)

then it hasn't shot itself in the foot.

Lex Fridman (38:49.160)

The uncanny power of universal Darwinism

Robert Breedlove (38:51.300)

has been likened by the philosopher Dan Dennett

Lex Fridman (38:54.120)

to a universal acid.

Lex Fridman (38:56.740)

And Dan Dennett says, quote, there is no denying

Lex Fridman (38:58.940)

at this point that Darwin's idea is a universal solvent,

Robert Breedlove (39:02.380)

capable of cutting right to the heart

Lex Fridman (39:04.020)

of everything in sight.

Lex Fridman (39:05.720)

The question is, what does it leave behind?

Lex Fridman (39:08.500)

I have tried to show that once it passes through everything,

Robert Breedlove (39:10.860)

we are left with stronger, sounder versions

Lex Fridman (39:13.100)

of our most important ideas.

Robert Breedlove (39:15.740)

Some of the traditional details perish,

Lex Fridman (39:17.880)

and some of these are losses to be regretted,

Lex Fridman (39:20.380)

but good riddance to the rest of them.

Lex Fridman (39:22.220)

What remains is more than enough to build on, unquote.

Lex Fridman (39:26.340)

So the way I would interpret that is that life itself,

Lex Fridman (39:31.660)

I've come to view life as information propagating

Robert Breedlove (39:34.620)

through flesh, and that we are,

Lex Fridman (39:38.620)

I guess DNA is a quadratic code.

Robert Breedlove (39:42.820)

I think it's four letters, maybe,

Lex Fridman (39:44.220)

versus a binary, zeros and ones.

Lex Fridman (39:46.540)

And we are ideas, we are strategies competing

Lex Fridman (39:49.620)

with each other, and nature is that which selects.

Robert Breedlove (39:54.300)

It's what selects the winning ideas,

Lex Fridman (39:56.500)

the ones that are most fit

Robert Breedlove (39:59.100)

to environmental conditions, frankly.

Lex Fridman (3:00:01.940)

than actual exertion, like energy can work?

Robert Breedlove (3:00:10.180)

No, I think proof of stake is inherently centralizing.

Lex Fridman (3:00:15.460)

It's like the old Matthew principle,

Robert Breedlove (3:00:18.380)

from those who have to those who have,

Lex Fridman (3:00:20.900)

more will be given from those who have not,

Robert Breedlove (3:00:22.900)

everything will be taken.

Lex Fridman (3:00:24.100)

That's what proof of stake is.

Robert Breedlove (3:00:26.420)

You need proof of work to embody skin in the game

Lex Fridman (3:00:29.860)

in the marketplace, such that contributions

Robert Breedlove (3:00:33.580)

are commensurate with consideration received.

Lex Fridman (3:00:36.420)

That's how systems work.

Robert Breedlove (3:00:39.420)

What's the idea why proof of work might

Lex Fridman (3:00:44.900)

incentivize decentralization?

Lex Fridman (3:00:49.620)

Do you worry that as Bitcoin becomes more powerful,

Lex Fridman (3:00:53.220)

it may become, again, more centralized?

Robert Breedlove (3:00:56.820)

Well, the decentralization of Bitcoin

Lex Fridman (3:01:00.980)

is largely driven by the nodes, actually,

Robert Breedlove (3:01:03.780)

which aren't actually mining.

Lex Fridman (3:01:05.300)

They're just choosing which rule set to implement.

Lex Fridman (3:01:10.660)

And then the mining network's

Lex Fridman (3:01:12.140)

actually enforcing that rule set.

Lex Fridman (3:01:14.580)

So I think the mining network

Lex Fridman (3:01:19.580)

is inherently decentralized in that,

Robert Breedlove (3:01:22.140)

really anyone with access to cheap energy

Lex Fridman (3:01:24.540)

can become a miner.

Robert Breedlove (3:01:25.580)

You can freely enter or exit the market

Lex Fridman (3:01:27.860)

or the network at any time.

Lex Fridman (3:01:30.860)

But maintaining the block size at a manageable level

Lex Fridman (3:01:34.780)

is what's key to maintaining node decentralization.

Robert Breedlove (3:01:38.020)

This is an interesting question.

Lex Fridman (3:01:40.540)

Who do you think has more power, the miners or the nodes?

Robert Breedlove (3:01:44.340)

Because the nodes carry the idea of the protocol,

Lex Fridman (3:01:49.340)

like the specifics.

Lex Fridman (3:01:52.340)

So in some sense, they have more power,

Lex Fridman (3:01:55.140)

if Bitcoin is an idea.

Robert Breedlove (3:01:58.340)

They're kind of mutually indispensable though,

Lex Fridman (3:02:00.500)

because you can't have,

Robert Breedlove (3:02:03.580)

there's no security without the miners.

Lex Fridman (3:02:05.740)

So without the miners, Bitcoin is just an idea.

Lex Fridman (3:02:08.260)

And the idea of Bitcoin has maybe existed

Lex Fridman (3:02:11.980)

even before Bitcoin, right?

Robert Breedlove (3:02:13.060)

Just sound money.

Lex Fridman (3:02:13.900)

We just say sound money as an idea.

Lex Fridman (3:02:15.660)

But there was no way to root that into thermodynamic reality

Lex Fridman (3:02:19.620)

without Satoshi figuring out, not just proof of work,

Robert Breedlove (3:02:24.060)

it's the entire composite of the difficulty adjustment,

Lex Fridman (3:02:27.340)

proof of work, one way hashing, et cetera.

Lex Fridman (3:02:31.700)

So I don't know, that's hard to say,

Lex Fridman (3:02:34.020)

hard to disentangle the two.

Robert Breedlove (3:02:36.340)

You've talked about money as morality too.

Lex Fridman (3:02:40.460)

How do you think about moral and immoral action

Lex Fridman (3:02:43.540)

in the context of money?

Lex Fridman (3:02:47.340)

There's this great quote by Rothbard,

Robert Breedlove (3:02:51.020)

who's a famous Austrian economist.

Lex Fridman (3:02:53.740)

And he says, quote, to be moral, an act must be free,

Robert Breedlove (3:02:58.900)

unquote.

Lex Fridman (3:03:00.860)

And I think morality, it changes over time

Lex Fridman (3:03:07.900)

and it is, it has its roots

Lex Fridman (3:03:12.220)

in biology.

Robert Breedlove (3:03:15.700)

Jordan Peterson makes the point that even animals

Lex Fridman (3:03:17.540)

have their own sort of pseudo morality.

Robert Breedlove (3:03:21.100)

Where like with wolf packs, for instance,

Lex Fridman (3:03:24.420)

if there's a dispute between the alpha males,

Robert Breedlove (3:03:26.900)

or I guess between an alpha male and a incumbent,

Lex Fridman (3:03:30.780)

the two males will have a fight basically.

Lex Fridman (3:03:35.460)

And then when one, it's decided that one has won,

Lex Fridman (3:03:39.420)

the loser will basically roll over and give up his neck

Robert Breedlove (3:03:42.020)

to the alpha male.

Lex Fridman (3:03:44.940)

And they do this instead of fighting to the death

Robert Breedlove (3:03:47.780)

because in a wolf pack, they need every wolf

Lex Fridman (3:03:50.980)

so they can go out and bring down,

Robert Breedlove (3:03:52.780)

you never know when you're gonna need the 20th wolf

Lex Fridman (3:03:54.900)

to bring down the big buffalo the next day or whatever.

Lex Fridman (3:03:56.980)

So they've developed this less than fight to the death

Lex Fridman (3:04:01.260)

social morality to optimize their effectiveness

Robert Breedlove (3:04:04.540)

as a wolf pack.

Lex Fridman (3:04:07.860)

And similarly for humans, like our morality

Robert Breedlove (3:04:10.740)

sort of emerges through competition and play even.

Lex Fridman (3:04:16.140)

There are these implicit rules that come into place

Robert Breedlove (3:04:19.860)

based on how we're organizing ourselves over time.

Lex Fridman (3:04:23.980)

And with, so with money it's interesting

Robert Breedlove (3:04:29.380)

because most tools we would consider to be amoral,

Lex Fridman (3:04:34.380)

as in a hammer can be used to build a house

Robert Breedlove (3:04:38.060)

which could be seen to be good,

Lex Fridman (3:04:39.340)

like a good constructive purpose,

Robert Breedlove (3:04:40.780)

or it could be used to bash them on skull,

Lex Fridman (3:04:43.060)

which could be something evil.

Lex Fridman (3:04:45.940)

And that the tool itself is amoral,

Lex Fridman (3:04:49.380)

doesn't have any independent morality of its own.

Robert Breedlove (3:04:51.500)

All of the morality is associated

Lex Fridman (3:04:54.020)

with the wielder of the tool.

Lex Fridman (3:04:55.380)

So what's the quote like, any tool can be a weapon

Lex Fridman (3:04:58.620)

if you hold it right sort of thing.

Lex Fridman (3:05:01.460)

But money's maybe a little bit different in that

Lex Fridman (3:05:05.660)

when you monopolize money,

Robert Breedlove (3:05:11.860)

it's only useful as a tool for one thing.

Lex Fridman (3:05:15.260)

And that's for allocating wealth away from some

Lex Fridman (3:05:17.820)

and to others.

Lex Fridman (3:05:19.420)

So it is the only utility of monopolized money is theft.

Robert Breedlove (3:05:24.500)

There's no other, there's a lot of propaganda out there

Lex Fridman (3:05:28.220)

that will say, oh, we need to print money

Robert Breedlove (3:05:29.660)

to get out of this disaster or to give to the poor,

Lex Fridman (3:05:34.340)

whatever moralistically camouflaged political aim

Robert Breedlove (3:05:40.260)

is being discussed, the base layer of monopolized money

Lex Fridman (3:05:44.260)

is that it's only useful for taking from some

Lex Fridman (3:05:46.300)

and giving to others.

Lex Fridman (3:05:47.780)

So another way to think about this is that money

Robert Breedlove (3:05:51.500)

is a paper claim on the savings of society.

Lex Fridman (3:05:55.100)

So it is just a ticket for redeeming savings,

Robert Breedlove (3:05:58.100)

which could be time, could be capital,

Lex Fridman (3:06:00.820)

it could be knowledge from any market actor in the world.

Lex Fridman (3:06:04.580)

So it's kind of a list of who owns what,

Lex Fridman (3:06:06.780)

if you will, it's a proxy list.

Robert Breedlove (3:06:08.100)

If there's one group that can amend that list

Lex Fridman (3:06:11.180)

and others cannot, then they're basically able

Lex Fridman (3:06:14.700)

and incented to modify that list to their own benefit.

Lex Fridman (3:06:20.380)

And that's effectively what a central bank is doing.

Lex Fridman (3:06:23.060)

So a central bank is determining how much money to create.

Lex Fridman (3:06:27.100)

They're also determining who gets to receive

Robert Breedlove (3:06:28.740)

that money first and the first recipients of that money

Lex Fridman (3:06:33.140)

are gonna be the beneficiaries in an inflationary regime.

Lex Fridman (3:06:37.300)

So those that receive the money last

Lex Fridman (3:06:39.060)

are the ones being robbed.

Robert Breedlove (3:06:40.620)

Those that receive the money first are the ones

Lex Fridman (3:06:42.580)

that are receiving the stolen proceeds, let's say.

Lex Fridman (3:06:48.460)

And this has a really corrosive effect on social morality

Lex Fridman (3:06:53.460)

because if we consider that people's time horizon,

Robert Breedlove (3:06:59.620)

which the Austrians call the time preference,

Lex Fridman (3:07:02.940)

the more short term thinking you are,

Robert Breedlove (3:07:05.940)

the more likely you are to engage in selfish behavior.

Lex Fridman (3:07:10.940)

If you know that it's all over tomorrow

Lex Fridman (3:07:15.580)

and you've been working your whole life

Lex Fridman (3:07:16.900)

to develop this business or create this reputation

Robert Breedlove (3:07:20.380)

or whatever your thing is,

Lex Fridman (3:07:21.220)

but you just are given the foreknowledge that tomorrow

Robert Breedlove (3:07:23.660)

it's all gonna end, you're much more likely to go out

Lex Fridman (3:07:26.620)

and just maybe get drunk and party that night

Robert Breedlove (3:07:28.740)

because there's no more repercussions.

Lex Fridman (3:07:32.220)

Whereas if you know that you're gonna live

Robert Breedlove (3:07:35.700)

for a very long time, you're much more likely

Lex Fridman (3:07:38.860)

to plan for the future.

Lex Fridman (3:07:45.140)

So we just say that your time horizon

Lex Fridman (3:07:46.460)

is closely related to your morality.

Robert Breedlove (3:07:48.900)

The longer term thinking you are, the more moral

Lex Fridman (3:07:51.500)

you would tend to behave, the more you would care

Robert Breedlove (3:07:53.140)

about long term relationship building

Lex Fridman (3:07:55.020)

versus going out and getting wasted.

Lex Fridman (3:07:57.580)

And money too impinges very closely on our time preference.

Lex Fridman (3:08:03.580)

And again, time preference is the Austrian term.

Lex Fridman (3:08:05.300)

So low time preference means you're long term oriented,

Lex Fridman (3:08:09.020)

high time preference means you're short term oriented,

Robert Breedlove (3:08:11.260)

which can be a little trippy for some people

Lex Fridman (3:08:13.300)

because it sounds backwards.

Lex Fridman (3:08:14.460)

But if your money constantly loses value,

Lex Fridman (3:08:21.220)

you are incentivized to become more short term oriented.

Robert Breedlove (3:08:25.460)

You are handicapped in your ability to plan for the future

Lex Fridman (3:08:29.820)

because your money, which is intended to be,

Robert Breedlove (3:08:33.980)

here's another definition of money,

Lex Fridman (3:08:35.380)

as an insurance policy against uncertainty.

Lex Fridman (3:08:38.260)

So no matter what problems you encounter in the world,

Lex Fridman (3:08:40.580)

this money will best help you deal with those problems.

Robert Breedlove (3:08:44.060)

When that insurance policy against uncertainty

Lex Fridman (3:08:46.660)

is injected with uncertainty, it's polluted

Robert Breedlove (3:08:49.660)

with the uncertainty of inflation,

Lex Fridman (3:08:51.500)

your time horizon shrinks,

Robert Breedlove (3:08:53.060)

your ability to plan long term shrinks.

Lex Fridman (3:08:55.300)

And this impinges on social morality.

Lex Fridman (3:08:58.100)

So there's a great book on this called Honest Money

Lex Fridman (3:09:01.380)

by Gary North.

Lex Fridman (3:09:02.820)

And in that book, he gives the parable of the wine maker.

Lex Fridman (3:09:06.340)

And the wine maker, if we just imagine

Robert Breedlove (3:09:10.780)

the hypothetical wine maker,

Lex Fridman (3:09:12.420)

operating a business in a centrally banked economy.

Lex Fridman (3:09:15.500)

And let's say his central bank just doubled

Lex Fridman (3:09:17.540)

the money supply to quote unquote save the economy.

Robert Breedlove (3:09:21.620)

Say an increase in money supply from one to $2 trillion.

Lex Fridman (3:09:24.780)

This wine maker that's accustomed to selling wine

Robert Breedlove (3:09:26.940)

at $20 a bottle is now faced with basically three choices.

Lex Fridman (3:09:34.300)

And an important point here too,

Robert Breedlove (3:09:36.020)

before we get into his three choices,

Lex Fridman (3:09:37.420)

are what prices are themselves.

Robert Breedlove (3:09:39.340)

Prices are the most visible aspect of any service.

Lex Fridman (3:09:43.980)

So when you increase prices,

Robert Breedlove (3:09:46.940)

you're incentivizing your customers to look elsewhere.

Lex Fridman (3:09:49.740)

They're gonna look at your competition.

Robert Breedlove (3:09:51.380)

When you decrease prices,

Lex Fridman (3:09:53.100)

you're incentivizing market actors

Lex Fridman (3:09:55.380)

to look closer at your product, right?

Lex Fridman (3:09:57.180)

You're delivering a solution at a lower price.

Lex Fridman (3:10:00.100)

So this wine maker that's accustomed to selling his wine

Lex Fridman (3:10:02.420)

at a $20 price point, all of a sudden,

Robert Breedlove (3:10:05.260)

because of a central bank has tripled the money supply,

Lex Fridman (3:10:07.900)

he has three choices.

Robert Breedlove (3:10:10.260)

He can either keep selling his bottle at $20

Lex Fridman (3:10:14.500)

and all of his inputs will increase due to inflation by 50%.

Lex Fridman (3:10:19.020)

So he will lose 50% of his profit margin as a result.

Lex Fridman (3:10:24.220)

So he can choose to eat that loss.

Robert Breedlove (3:10:26.100)

He can choose to double the selling price

Lex Fridman (3:10:28.420)

of his bottle of wine from $20 to $40,

Robert Breedlove (3:10:31.380)

because all of the price of his inputs doubled.

Lex Fridman (3:10:33.820)

So then he would maintain his profit margin.

Robert Breedlove (3:10:36.060)

Or the third one is that he could choose

Lex Fridman (3:10:40.100)

to water down his wine or use inferior ingredients.

Lex Fridman (3:10:44.740)

So he could use cheaper inputs

Lex Fridman (3:10:46.740)

and maintain the output at the same price.

Lex Fridman (3:10:51.100)

So he could basically start selling his customers

Lex Fridman (3:10:53.900)

an inferior product for the same price

Robert Breedlove (3:10:55.460)

to preserve his profit margin.

Lex Fridman (3:10:57.980)

Now, again, case number one, it's not very palatable.

Robert Breedlove (3:11:01.420)

He doesn't wanna eat the economic loss.

Lex Fridman (3:11:03.220)

Case number two, he doesn't wanna eat the profit margin.

Robert Breedlove (3:11:06.020)

Case number two, it's not very good either,

Lex Fridman (3:11:08.340)

because he's then incentivizing all of his customers

Robert Breedlove (3:11:10.660)

to go shop other winemakers if he doubles his price.

Lex Fridman (3:11:14.220)

So human nature being what it is,

Robert Breedlove (3:11:16.580)

trying to get something for nothing,

Lex Fridman (3:11:18.580)

inflation actually seeps into other industries

Robert Breedlove (3:11:21.340)

by encouraging producers into option three,

Lex Fridman (3:11:24.740)

which is to deceive your customer in the short run.

Lex Fridman (3:11:27.940)

And again, this would be done initially at the margins.

Lex Fridman (3:11:31.020)

Maybe it's just a few drops of water.

Robert Breedlove (3:11:32.460)

Maybe it's just some cheaper grapes.

Lex Fridman (3:11:35.260)

But over time, this inflation is actually inducing producers

Robert Breedlove (3:11:42.500)

to weigh their financial wellbeing

Lex Fridman (3:11:45.300)

against their moral integrity.

Lex Fridman (3:11:47.300)

So it's forcing them into this dilemma

Lex Fridman (3:11:49.700)

that would not exist in a free market economy.

Lex Fridman (3:11:53.220)

And as they charge more money for wine that is inferior,

Lex Fridman (3:11:58.940)

the buyers of that wine,

Robert Breedlove (3:12:00.940)

also living in a central banked economy

Lex Fridman (3:12:02.620)

are also getting scammed by not only the inflation,

Lex Fridman (3:12:05.180)

but also the wine.

Lex Fridman (3:12:06.420)

So it becomes this kind of corrosive contagious moral effect

Robert Breedlove (3:12:12.260)

that propagates throughout an economy.

Lex Fridman (3:12:14.860)

And that's why I've argued in a lot of my writing

Robert Breedlove (3:12:18.500)

that inflation is this infectious moral cancer on the world.

Lex Fridman (3:12:24.100)

I think it is tied back to a lot of the social strangeness

Robert Breedlove (3:12:30.860)

we've seen in modern times,

Lex Fridman (3:12:32.460)

where there seems to be a lot of fake people

Lex Fridman (3:12:35.900)

and a lot of fake businesses and a lot of scams,

Lex Fridman (3:12:38.020)

all of these things.

Robert Breedlove (3:12:38.860)

I think it really is rooted in the money.

Lex Fridman (3:12:40.940)

And Bitcoin, as the first money in history

Robert Breedlove (3:12:45.100)

that has a 0% terminal inflation rate,

Lex Fridman (3:12:47.340)

or said differently, zero unexpected inflation.

Robert Breedlove (3:12:50.480)

There's no theft integrated into Bitcoin.

Lex Fridman (3:12:54.340)

You can only earn it through work

Robert Breedlove (3:12:56.020)

or sacrificing resources to obtain it.

Lex Fridman (3:12:58.280)

It is the antidote to this moral cancer

Robert Breedlove (3:13:03.760)

that inflation riddles our society with.

Lex Fridman (3:13:07.040)

Again, you're blowing my mind a little bit

Robert Breedlove (3:13:08.820)

to think about the ripple effects of inflation,

Lex Fridman (3:13:11.840)

the way it seeps through our interactions.

Lex Fridman (3:13:15.120)

So at the very, the early ripples

Lex Fridman (3:13:18.560)

is the effect it has on the products,

Robert Breedlove (3:13:20.400)

on the dilution of the wine.

Lex Fridman (3:13:23.080)

But also it might have ripple effects on the character,

Robert Breedlove (3:13:27.160)

on the behavior of people.

Lex Fridman (3:13:30.200)

That's interesting, artificial creation of scarcity,

Robert Breedlove (3:13:33.320)

creating, having effects on society at the social,

Lex Fridman (3:13:38.640)

like the social fabric.

Lex Fridman (3:13:40.200)

And I guess you're arguing the morality.

Lex Fridman (3:13:43.980)

It's perverting free market dynamics,

Robert Breedlove (3:13:45.960)

which again, we said free markets generate pragmatic truth.

Lex Fridman (3:13:49.000)

So inflation distorts price signals,

Robert Breedlove (3:13:52.000)

which means it confuses capital allocation.

Lex Fridman (3:13:54.960)

So we're trying to solve problems,

Lex Fridman (3:13:56.280)

but all of a sudden we can't tell

Lex Fridman (3:13:58.080)

if this price increase is a matter

Robert Breedlove (3:13:59.560)

of true supply and demand change

Lex Fridman (3:14:01.640)

or a matter of policy change.

Lex Fridman (3:14:03.520)

So it clouds our economic perceptions.

Lex Fridman (3:14:07.200)

It suppresses innovation

Robert Breedlove (3:14:09.360)

because now you've exacerbated

Lex Fridman (3:14:11.120)

the boom and bust business cycle.

Robert Breedlove (3:14:12.520)

People are gonna overborrow and go into projects

Lex Fridman (3:14:14.960)

that they can't profitably sustain.

Lex Fridman (3:14:16.840)

So then there'll be a huge collapse.

Lex Fridman (3:14:18.360)

So that actually breaks the market's function

Robert Breedlove (3:14:22.280)

of generating innovation.

Lex Fridman (3:14:24.080)

And then, yeah, I would argue too

Robert Breedlove (3:14:25.220)

that it pollutes our pursuit of virtue, let's say.

Lex Fridman (3:14:29.560)

Maybe it's pushing back, but I don't think so.

Robert Breedlove (3:14:33.320)

It's not as clear to me,

Lex Fridman (3:14:34.880)

perhaps because I haven't thought about it deeply,

Robert Breedlove (3:14:36.860)

that money is core to life and human interaction

Lex Fridman (3:14:43.320)

because there might be other forces,

Robert Breedlove (3:14:45.600)

other fraudulent forces, other things in human nature

Lex Fridman (3:14:48.900)

that are creating these effects as well.

Lex Fridman (3:14:51.200)

So it's clear, I think you're articulating really well

Lex Fridman (3:14:53.320)

that there's these negative effects from inflation.

Robert Breedlove (3:14:56.200)

I wonder if there's other undiscovered,

Lex Fridman (3:14:59.040)

not undiscovered, but ones we're not making explicit now,

Robert Breedlove (3:15:02.320)

forces that are creating all the things we're seeing now

Lex Fridman (3:15:08.600)

with, like you said, cancer culture and all those things,

Lex Fridman (3:15:11.500)

but also the negative effects on the quality of products,

Lex Fridman (3:15:16.920)

on the excellence of the creativity and the innovation,

Robert Breedlove (3:15:20.360)

all those kinds of things.

Lex Fridman (3:15:21.200)

I wonder if there's other factors.

Robert Breedlove (3:15:23.160)

It's kind of, listen, it's compelling to think money's

Lex Fridman (3:15:26.760)

at the core of it all.

Robert Breedlove (3:15:28.360)

Like if you fix, I forgot what the phrase was.

Lex Fridman (3:15:30.760)

Fix the money, fix the world.

Robert Breedlove (3:15:31.760)

Yeah, fix the money, fix the world.

Lex Fridman (3:15:35.640)

Again, things that sound good, I'm skeptical of by nature.

Lex Fridman (3:15:40.520)

So I wonder if there's other things that are beyond money

Lex Fridman (3:15:44.480)

that are somehow deeply integrated into our human nature.

Robert Breedlove (3:15:47.320)

Another one related to money is social cohesion itself.

Lex Fridman (3:15:51.640)

So very simple anecdote for this was the more you increase

Robert Breedlove (3:15:57.140)

the inflation rate, social cohesion is inversely

Lex Fridman (3:16:01.120)

proportionate to that.

Lex Fridman (3:16:02.140)

So the extreme example would be hyperinflation, right?

Lex Fridman (3:16:04.620)

Where the money is produced in such excess

Robert Breedlove (3:16:07.300)

that it loses all meaning and relevance.

Lex Fridman (3:16:09.800)

So today in Venezuela, there is cash clogging the gutters,

Robert Breedlove (3:16:14.400)

clogging the streets, clogging the sewer system,

Lex Fridman (3:16:17.700)

because the cash has lost all relevance.

Lex Fridman (3:16:21.160)

And so anecdotally, we would suspect that,

Lex Fridman (3:16:23.640)

okay, if there's a inverse relationship

Robert Breedlove (3:16:27.080)

between inflation and social cohesion,

Lex Fridman (3:16:29.960)

if we could then take inflation to zero,

Robert Breedlove (3:16:32.700)

couldn't we theoretically increase

Lex Fridman (3:16:34.520)

social cohesion to its maximum?

Lex Fridman (3:16:38.640)

So another way to say that is inflation

Lex Fridman (3:16:40.600)

is a decivilizing force, whereas natural price deflation,

Robert Breedlove (3:16:45.760)

which would occur in a hard money economy,

Lex Fridman (3:16:48.600)

where there's either a fixed supply of Bitcoin

Robert Breedlove (3:16:51.040)

or a relatively scarce supply of gold, for instance,

Lex Fridman (3:16:56.200)

that lays claim to an increasing capital stock

Robert Breedlove (3:17:00.280)

of goods and services, prices would naturally decline

Lex Fridman (3:17:03.500)

every year as we became smarter.

Lex Fridman (3:17:06.120)

So the market price becomes a reflection

Lex Fridman (3:17:07.840)

of our collective knowledge.

Lex Fridman (3:17:09.840)

So by letting prices decline naturally over time,

Lex Fridman (3:17:12.680)

we can actually induce civilization.

Lex Fridman (3:17:16.120)

But by trying to force prices higher all the time

Lex Fridman (3:17:18.640)

via the central bank, we're creating the opposite effect.

Lex Fridman (3:17:21.880)

So we talked a little bit about the Soviet Union,

Lex Fridman (3:17:24.160)

and I happened to have lived through the collapse

Robert Breedlove (3:17:26.380)

of the Soviet Union.

Lex Fridman (3:17:28.780)

And so what are the factors, the causes in your mind

Lex Fridman (3:17:34.660)

to why the Soviet Union collapsed?

Lex Fridman (3:17:38.280)

So, you know, definitely a multivariate situation.

Robert Breedlove (3:17:42.920)

I think there's a lot of factors.

Lex Fridman (3:17:45.160)

One that jumped out to me recently,

Robert Breedlove (3:17:48.860)

again, from that documentary that I didn't note before

Lex Fridman (3:17:51.420)

was that at one point, Stalin eliminated,

Robert Breedlove (3:17:54.060)

I think 75% of his intelligence force,

Lex Fridman (3:17:59.420)

which I think when you're competing

Robert Breedlove (3:18:01.300)

with another nation state, you know,

Lex Fridman (3:18:04.100)

and intelligence and covert operations

Robert Breedlove (3:18:06.820)

are very integral to your survival,

Lex Fridman (3:18:08.820)

I think that was definitely a shot in the foot.

Lex Fridman (3:18:13.560)

But at a higher level, I would say that capitalism

Lex Fridman (3:18:19.780)

and communism were each resource strategies

Robert Breedlove (3:18:23.620)

of the 20th century nation state.

Lex Fridman (3:18:27.740)

And they seem, you know, we commonly consider them

Robert Breedlove (3:18:30.080)

to be diametrically opposed,

Lex Fridman (3:18:31.460)

but there's actually a lot of commonality between the two.

Robert Breedlove (3:18:34.780)

The difference would be that in Soviet Russia,

Lex Fridman (3:18:39.300)

as we alluded to earlier,

Robert Breedlove (3:18:40.460)

they tried to completely replace price signals

Lex Fridman (3:18:44.720)

with this nationalistic faith and devotion.

Lex Fridman (3:18:46.860)

So they removed the economic nerve signal,

Lex Fridman (3:18:50.660)

which coordinated the allocation of capital over time.

Lex Fridman (3:18:53.700)

So this inhibited their ability to generate wealth.

Lex Fridman (3:18:57.020)

Whereas in the United States,

Robert Breedlove (3:18:58.240)

we left most markets open to free enterprise.

Lex Fridman (3:19:02.340)

So we honored the integrity of price signals

Lex Fridman (3:19:06.100)

and we allowed people to trade and accumulate wealth.

Lex Fridman (3:19:11.680)

So in every market, except the market for money,

Robert Breedlove (3:19:14.600)

both markets maintained a central bank as we've gotten to.

Lex Fridman (3:19:18.280)

So I think in a really big picture standpoint,

Robert Breedlove (3:19:23.060)

that's why capitalism outcompetes communism

Lex Fridman (3:19:27.540)

is because it is able to generate more wealth

Robert Breedlove (3:19:31.220)

than communism was,

Lex Fridman (3:19:32.940)

and therefore was able to put financial pressure

Robert Breedlove (3:19:35.620)

on the USSR until it reached the point of bankruptcy,

Lex Fridman (3:19:39.340)

essentially.

Robert Breedlove (3:19:41.180)

A similar model, I would argue,

Lex Fridman (3:19:44.120)

is that for the same reasons we saw

Robert Breedlove (3:19:48.580)

capitalism outcompete communism,

Lex Fridman (3:19:50.100)

which I think the data that I recall

Robert Breedlove (3:19:53.880)

was that the USSR's economy was valued

Lex Fridman (3:19:56.580)

at close to one third of its inputs.

Lex Fridman (3:19:59.660)

So if you just didn't do anything inside the USSR

Lex Fridman (3:20:02.820)

and just sold all the raw materials that were going into it,

Robert Breedlove (3:20:05.380)

it would have been worth three times as much

Lex Fridman (3:20:07.940)

as sending the materials in,

Robert Breedlove (3:20:09.820)

running it through the efforts

Lex Fridman (3:20:10.900)

and then shipping things back out.

Robert Breedlove (3:20:12.620)

It was value destructive versus value creative.

Lex Fridman (3:20:16.260)

And I would argue this is because,

Robert Breedlove (3:20:18.580)

again, the centralized computing model

Lex Fridman (3:20:21.420)

versus decentralized computing model,

Robert Breedlove (3:20:23.340)

it just became more and more corrupt over time.

Lex Fridman (3:20:27.780)

It got to the point where I think most of the occupations

Lex Fridman (3:20:30.900)

in USSR towards the end were as informants, right?

Lex Fridman (3:20:34.220)

They were working for the state.

Robert Breedlove (3:20:37.140)

Jordan Peterson makes this point too,

Lex Fridman (3:20:38.500)

that at some point it was actually illegal

Robert Breedlove (3:20:40.540)

to be sad in Soviet Russia.

Lex Fridman (3:20:43.100)

Because if you were sad,

Robert Breedlove (3:20:44.980)

you were contradicting the utopian view of the state.

Lex Fridman (3:20:48.900)

So if you were sad,

Robert Breedlove (3:20:49.740)

you're implying the state's not doing something wrong.

Lex Fridman (3:20:51.940)

But by the way, this does remind me,

Lex Fridman (3:20:55.020)

do you know what Jordan Peterson thinks about Bitcoin

Lex Fridman (3:20:57.180)

and about the future impact of Bitcoin on the society?

Robert Breedlove (3:21:02.180)

No, I don't actually.

Lex Fridman (3:21:06.980)

We're hopefully gonna be talking to him soon about that.

Robert Breedlove (3:21:10.620)

We did a book club on his book, Maps of Meaning,

Lex Fridman (3:21:14.140)

and he engaged with us about it.

Lex Fridman (3:21:16.100)

So we're hoping to deliver the orange bill to Mr. Peterson.

Lex Fridman (3:21:19.060)

The orange bill.

Robert Breedlove (3:21:20.660)

I think his audience is one of the most important audiences

Lex Fridman (3:21:24.020)

in the world to understand Bitcoin,

Robert Breedlove (3:21:25.340)

these people that are conscientious and responsible.

Lex Fridman (3:21:29.380)

I think they'll quickly understand Bitcoin's

Robert Breedlove (3:21:34.660)

value proposition and help elucidate it to the world.

Lex Fridman (3:21:38.460)

I'm trying to remember what he said about it.

Robert Breedlove (3:21:41.180)

Basically, I think his support of Bitcoin

Lex Fridman (3:21:44.180)

is grounded in the kind of people

Robert Breedlove (3:21:47.060)

who are opposing Bitcoin.

Lex Fridman (3:21:49.860)

So without understanding Bitcoin,

Robert Breedlove (3:21:52.700)

he starts to like Bitcoin

Lex Fridman (3:21:54.420)

because of the people who are opposing it.

Robert Breedlove (3:21:56.620)

He's, you know, you start to, I mean,

Lex Fridman (3:21:59.580)

that's partially why I am interested in Bitcoin.

Robert Breedlove (3:22:03.660)

It's like all the people in power

Lex Fridman (3:22:08.540)

and all the kind of shady, fraudulent,

Robert Breedlove (3:22:12.340)

non genuine people who are dismissing Bitcoin

Lex Fridman (3:22:17.540)

are making me think, hmm.

Robert Breedlove (3:22:19.420)

One of Jordan's definitions of God is,

Lex Fridman (3:22:23.500)

he says, God is found in the truthful speech

Robert Breedlove (3:22:26.740)

that rectifies pathological hierarchies.

Lex Fridman (3:22:30.300)

And I think that is a beautiful definition

Robert Breedlove (3:22:34.660)

of what Bitcoin is doing in the world.

Lex Fridman (3:22:36.660)

And that we have this pathological hierarchy

Robert Breedlove (3:22:39.060)

called central banking,

Lex Fridman (3:22:40.820)

by which the rich get richer and the poor get poorer,

Robert Breedlove (3:22:45.020)

that is used as a mechanism for perpetual theft

Lex Fridman (3:22:48.260)

and funding warfare at a global scale.

Robert Breedlove (3:22:51.300)

Like Ron Paul said, it's no coincidence

Lex Fridman (3:22:53.540)

that the 20th century of total war

Robert Breedlove (3:22:56.020)

was also the century of central banking.

Lex Fridman (3:22:59.540)

When you have an institution of currency counterfeiting,

Robert Breedlove (3:23:04.540)

which the central bank is,

Lex Fridman (3:23:06.660)

you are no longer bounded by your own balance sheet

Robert Breedlove (3:23:09.340)

when you go to war.

Lex Fridman (3:23:10.300)

You don't have to just go to war on your own resources.

Robert Breedlove (3:23:12.340)

You can now pillage the commonwealth

Lex Fridman (3:23:15.180)

and pull for the savings of society as a whole

Robert Breedlove (3:23:18.940)

before you go bankrupt.

Lex Fridman (3:23:21.380)

And indeed, this is what Hitler did, right?

Robert Breedlove (3:23:23.900)

Hitler hyperinflated in the Weimar Republic

Lex Fridman (3:23:28.260)

to fund his war efforts.

Lex Fridman (3:23:31.780)

And frankly, every dictator, every world war,

Lex Fridman (3:23:35.620)

every internment camp in history was made possible

Robert Breedlove (3:23:39.700)

by the weaponization of money in fiat currency.

Lex Fridman (3:23:43.460)

So I hope, I know Jordan Peterson

Robert Breedlove (3:23:46.900)

is a huge proponent of free speech.

Lex Fridman (3:23:49.340)

And I think that's ultimately at its deepest essence,

Lex Fridman (3:23:51.740)

that's what Bitcoin really is, right?

Lex Fridman (3:23:53.180)

It is just the purest form

Robert Breedlove (3:23:55.420)

of monetary speech we've ever had.

Lex Fridman (3:23:58.540)

And by purifying that primary operating system

Robert Breedlove (3:24:02.940)

of human action, I think we can eliminate

Lex Fridman (3:24:06.180)

this pathological hierarchy that is unfortunately

Robert Breedlove (3:24:09.220)

the dominant institution in the world today.

Lex Fridman (3:24:11.780)

Yeah, I'm definitely,

Robert Breedlove (3:24:13.380)

especially with these explorations of Bitcoin,

Lex Fridman (3:24:16.340)

this journey I've been on,

Robert Breedlove (3:24:18.020)

I'll revisit some of the aspects of human history

Lex Fridman (3:24:21.380)

that I've been looking at like Stalin and Hitler

Robert Breedlove (3:24:24.620)

with a, from a perspective of a monetary perspective,

Lex Fridman (3:24:28.820)

like what are the effects of inflation?

Lex Fridman (3:24:33.140)

How was it used as a tool in gaining power

Lex Fridman (3:24:37.980)

and maintaining power and manipulating the populace

Robert Breedlove (3:24:42.980)

in doing, in inflicting suffering

Lex Fridman (3:24:47.820)

and I would say evil onto the world.

Robert Breedlove (3:24:51.380)

It's interesting.

Lex Fridman (3:24:52.260)

I, it's interesting.

Robert Breedlove (3:24:54.740)

I'm gonna have to sort of go back into the hole.

Lex Fridman (3:24:56.860)

So I tend to focus more on the human nature

Lex Fridman (3:25:02.780)

and less about the tools

Lex Fridman (3:25:05.780)

that human nature leverages to affect change.

Lex Fridman (3:25:08.820)

But you're right that in some sense,

Lex Fridman (3:25:11.100)

money is a tool which can be effectively used

Robert Breedlove (3:25:17.500)

to perform moral and immoral actions

Lex Fridman (3:25:21.740)

depending on how it's used.

Lex Fridman (3:25:23.500)

There's a feedback between the two, right?

Lex Fridman (3:25:25.660)

There's, specifically with money itself,

Robert Breedlove (3:25:31.700)

it's the, here's the way I've been posing it lately

Lex Fridman (3:25:36.700)

is that I actually think we typically think of people

Robert Breedlove (3:25:39.700)

as good or bad, or again,

Lex Fridman (3:25:41.540)

trying to label people all the time,

Lex Fridman (3:25:43.300)

but I think people and their characters

Lex Fridman (3:25:45.620)

are emergent properties of the incentive structures

Robert Breedlove (3:25:48.540)

they inhabit.

Lex Fridman (3:25:49.380)

Yeah.

Lex Fridman (3:25:50.220)

So, you know, what does Charlie Munger say?

Lex Fridman (3:25:53.060)

Don't show me the incentives,

Robert Breedlove (3:25:54.300)

I'll show you the outcome kind of thing.

Lex Fridman (3:25:56.900)

This is a flawed incentive structure

Robert Breedlove (3:25:59.180)

we've been operating within.

Lex Fridman (3:26:01.100)

Now I'm not speaking to the intention.

Robert Breedlove (3:26:03.220)

People want to argue with me all the time.

Lex Fridman (3:26:04.620)

Like Jerome Powell's not a bad guy.

Robert Breedlove (3:26:06.980)

He's doing his best at the central bank.

Lex Fridman (3:26:08.620)

He's doing what he thinks is right.

Robert Breedlove (3:26:09.940)

That's fine.

Lex Fridman (3:26:11.780)

Well, that's true or not, it actually doesn't matter.

Robert Breedlove (3:26:13.700)

The intention is divergent from the outcome.

Lex Fridman (3:26:16.420)

The institution that they are running

Robert Breedlove (3:26:18.020)

is premised on deception and theft,

Lex Fridman (3:26:20.340)

and it is handicapping the productive economy.

Lex Fridman (3:26:22.980)

So when we're, even the terms we use, printing money,

Lex Fridman (3:26:26.300)

you're not creating any new value.

Robert Breedlove (3:26:27.980)

You're not infusing the economy with anything,

Lex Fridman (3:26:29.860)

any new productive factors whatsoever.

Robert Breedlove (3:26:31.860)

You're just creating new value.

Lex Fridman (3:26:33.540)

You're not infusing the economy with anything,

Robert Breedlove (3:26:35.260)

any new productive factors whatsoever.

Lex Fridman (3:26:37.220)

You're just harvesting the economic surplus

Robert Breedlove (3:26:39.500)

created by entrepreneurs in the marketplace.

Lex Fridman (3:26:42.300)

It's impossible to add any value to an economy

Robert Breedlove (3:26:45.300)

by increasing the paper claims on its savings.

Lex Fridman (3:26:48.420)

So there's a feedback loop between man and tool,

Robert Breedlove (3:26:54.460)

between creator and created.

Lex Fridman (3:26:56.020)

And I think we have to honor the relationship

Lex Fridman (3:26:59.780)

above either one, right?

Lex Fridman (3:27:01.300)

Trying to put the right people in the system

Robert Breedlove (3:27:03.300)

in the right place.

Lex Fridman (3:27:04.140)

Do you think the interesting question

Robert Breedlove (3:27:05.220)

of whether the people that are in control of central banks

Lex Fridman (3:27:12.060)

or in positions of power there,

Robert Breedlove (3:27:14.700)

if they themselves are malevolent,

Lex Fridman (3:27:17.220)

they themselves are bad actors,

Robert Breedlove (3:27:19.820)

or they're simply like leaves floating along the river,

Lex Fridman (3:27:25.220)

sort of just the cog in the machine,

Robert Breedlove (3:27:29.820)

an ant in an ant colony

Lex Fridman (3:27:31.380)

that operates in a certain kind of way.

Lex Fridman (3:27:33.940)

Like, where do you put the blame?

Lex Fridman (3:27:36.740)

Do you put the blame on the way things are operating

Robert Breedlove (3:27:40.740)

onto the individuals or onto the system itself,

Lex Fridman (3:27:44.460)

the idea behind the system?

Lex Fridman (3:27:46.980)

Where, and is it useful to place the blame somewhere?

Lex Fridman (3:27:50.860)

Because for me, it might be useful to understand that

Robert Breedlove (3:27:53.380)

in order to figure out what the solution is.

Lex Fridman (3:27:57.080)

I tend to not put the blame on the individual.

Robert Breedlove (3:27:59.840)

Like I tend to believe most people are good

Lex Fridman (3:28:02.460)

and want to see themselves as good.

Lex Fridman (3:28:05.340)

And so in that case, it's very difficult

Lex Fridman (3:28:07.760)

to be truly malevolent as you would need to be to control,

Robert Breedlove (3:28:11.100)

to gain centralized power at the large scale.

Lex Fridman (3:28:14.820)

But I know a lot of conspiracy theorists

Lex Fridman (3:28:19.140)

and just a lot of people think that there is evil humans

Lex Fridman (3:28:23.140)

in the world that seek power, maintain that power,

Lex Fridman (3:28:26.700)

and then use that power for bad purposes.

Lex Fridman (3:28:29.940)

I think they're just people.

Lex Fridman (3:28:32.300)

And they're just trying to get something for nothing,

Lex Fridman (3:28:34.380)

like all of us do.

Robert Breedlove (3:28:35.380)

I like this framework of thought.

Lex Fridman (3:28:37.860)

Well, honestly, and that's what the central bank is,

Robert Breedlove (3:28:42.120)

is the ultimate institution to get something for nothing.

Lex Fridman (3:28:44.980)

You get a perpetual income stream,

Robert Breedlove (3:28:49.680)

the ability to acquire more and more territory in the world

Lex Fridman (3:28:53.260)

through monopolizing the supply of money.

Lex Fridman (3:28:56.620)

And you can literally print money.

Lex Fridman (3:28:59.260)

You can buy your way out of anything

Lex Fridman (3:29:01.300)

and buy your way into anything in the world.

Lex Fridman (3:29:03.740)

So it is, I think the most, not say the most,

Lex Fridman (3:29:08.900)

but a group of very intelligent people

Lex Fridman (3:29:10.820)

put this thing together and figured out

Lex Fridman (3:29:12.740)

how to get something for nothing in perpetuity

Lex Fridman (3:29:17.780)

by clouding people's conception of money.

Lex Fridman (3:29:20.540)

And if we look at the central bank is,

Lex Fridman (3:29:24.780)

it's been around for a while,

Lex Fridman (3:29:25.700)

but the latest implementation here in the US is the Fed.

Lex Fridman (3:29:29.420)

It's about a hundred years old.

Robert Breedlove (3:29:30.540)

It's an analog age institution that I think has lost

Lex Fridman (3:29:34.240)

a lot of its relevance in the modern age.

Lex Fridman (3:29:37.900)

And I don't think it will survive

Lex Fridman (3:29:40.160)

the ever galvanizing gaze of the digital age.

Robert Breedlove (3:29:43.020)

There's just too much sunlight, too much transparency today.

Lex Fridman (3:29:47.020)

Ideas move too quickly for something like this

Robert Breedlove (3:29:49.380)

to remain relevant.

Lex Fridman (3:29:51.300)

But they are just people.

Robert Breedlove (3:29:53.980)

They are just seeking something for nothing.

Lex Fridman (3:29:55.740)

But I think when you concentrate that much power

Lex Fridman (3:29:58.220)

and that much control, that much wealth

Lex Fridman (3:30:00.340)

into the hands of few, it does change.

Robert Breedlove (3:30:04.980)

Hayek argued that the nature of power,

Lex Fridman (3:30:09.300)

again, it's something that we all sort of desire.

Lex Fridman (3:30:11.580)

To be completely powerless, you're really unhappy, right?

Lex Fridman (3:30:14.100)

If you're totally powerless, you're a slave.

Robert Breedlove (3:30:16.340)

Someone else tells you what to do.

Lex Fridman (3:30:17.700)

You have no autonomy.

Lex Fridman (3:30:18.980)

It's miserable, right?

Lex Fridman (3:30:20.580)

So there's this, it makes the consolidation

Robert Breedlove (3:30:23.140)

of power alluring and that we want to protect ourselves

Lex Fridman (3:30:25.880)

from that slave state, let's say.

Lex Fridman (3:30:28.360)

But like many things, it can be taken too far.

Lex Fridman (3:30:31.660)

And when you concentrate power into too few hands,

Robert Breedlove (3:30:35.480)

Hayek argues that it actually transforms.

Lex Fridman (3:30:38.460)

It becomes something much more intoxicating

Robert Breedlove (3:30:41.020)

than it would be if it was held in a more distributed way.

Lex Fridman (3:30:44.140)

And I think that gets into a lot of these,

Robert Breedlove (3:30:47.380)

I don't know if they call themselves elites

Lex Fridman (3:30:50.200)

or people call them elites or whatever,

Robert Breedlove (3:30:51.720)

like let's say shareholders of central banks,

Lex Fridman (3:30:54.920)

people participating in the World Economic Forum,

Robert Breedlove (3:30:56.760)

things like this.

Lex Fridman (3:30:59.260)

They come, I guess the incentives, right?

Robert Breedlove (3:31:01.700)

The incentive schema they're in is rewarding them constantly,

Lex Fridman (3:31:05.400)

telling them everything they're doing,

Robert Breedlove (3:31:06.680)

saying and thinking is correct

Lex Fridman (3:31:08.000)

because they just keep getting richer all the time.

Lex Fridman (3:31:10.880)

And it leads you closer to this definition of evil,

Lex Fridman (3:31:15.140)

which in the book, Paradise Lost,

Robert Breedlove (3:31:19.200)

Friedman said, evil is the force

Lex Fridman (3:31:20.940)

which believes its knowledge is complete.

Lex Fridman (3:31:23.740)

So these people become more and more convinced

Lex Fridman (3:31:27.380)

that they have the plan or they have the course of action

Robert Breedlove (3:31:32.180)

that will save the world,

Lex Fridman (3:31:33.280)

that if everyone would just listen to them,

Lex Fridman (3:31:35.640)

that they would lead us to the promised land, right?

Lex Fridman (3:31:38.000)

Whether this is Bill Gates saving us from a climate crisis

Robert Breedlove (3:31:41.160)

or any of these other economic policies

Lex Fridman (3:31:44.560)

that are targeted at a certain outcome,

Lex Fridman (3:31:46.420)

but almost always diverge almost perfectly

Lex Fridman (3:31:49.300)

from that outcome, creating its opposite effect.

Robert Breedlove (3:31:53.560)

I think that's the problem,

Lex Fridman (3:31:55.600)

that we have this mechanism that can concentrate wealth

Lex Fridman (3:31:58.700)

and power into the hands of so few

Lex Fridman (3:32:01.440)

that it leads to the proliferation of evil,

Robert Breedlove (3:32:05.660)

meaning that it convinces people

Lex Fridman (3:32:06.980)

that their knowledge is complete.

Robert Breedlove (3:32:08.280)

Whereas something like a Bitcoin

Lex Fridman (3:32:12.760)

almost forces the opposite outcome.

Robert Breedlove (3:32:17.480)

In a Bitcoin denominated world, a pure free market,

Lex Fridman (3:32:22.220)

the consumer is sovereign.

Lex Fridman (3:32:24.480)

So you cannot earn value in the world

Lex Fridman (3:32:28.000)

unless you are serving your fellow man,

Robert Breedlove (3:32:30.520)

unless they have expressed through their buy and sell

Lex Fridman (3:32:34.060)

decisions in the marketplace, right?

Robert Breedlove (3:32:35.800)

You've created a satisfaction of a particular want

Lex Fridman (3:32:39.560)

that they value so much,

Robert Breedlove (3:32:41.520)

they've acquired so much of your good or service

Lex Fridman (3:32:43.160)

that you've become rich.

Robert Breedlove (3:32:45.180)

You can only maintain that position of wealth

Lex Fridman (3:32:47.200)

so long as you continue to serve your fellow man.

Lex Fridman (3:32:49.960)

So it changes the incentives such that dominance

Lex Fridman (3:32:54.240)

in the world can no longer be paired with coercion.

Robert Breedlove (3:32:59.080)

It has to be paired with competence.

Lex Fridman (3:33:01.660)

And that's how this, when we say Bitcoin fixes this,

Robert Breedlove (3:33:05.460)

that's what we mean.

Lex Fridman (3:33:06.300)

Like it restores that skin in the game,

Robert Breedlove (3:33:09.320)

that balance of incentives and disincentives

Lex Fridman (3:33:11.380)

that help us properly navigate reality.

Lex Fridman (3:33:13.920)

And it prevents the buildup of systemic rot

Lex Fridman (3:33:17.280)

like we see with the central bank.

Lex Fridman (3:33:20.240)

What books?

Lex Fridman (3:33:21.400)

People love this question.

Lex Fridman (3:33:23.120)

And you're exceptionally well read.

Lex Fridman (3:33:25.840)

You've explored all kinds of ideas.

Robert Breedlove (3:33:28.200)

Is there some books, technical, fiction, philosophical,

Lex Fridman (3:33:31.960)

coloring books, children's books had an impact on your life

Lex Fridman (3:33:35.680)

and you would maybe recommend to others

Lex Fridman (3:33:38.760)

that they should read?

Robert Breedlove (3:33:39.860)

I think we mentioned a couple of them here today,

Lex Fridman (3:33:43.160)

but I think a really useful triplet of books

Robert Breedlove (3:33:49.180)

that I've been recommending recently

Lex Fridman (3:33:51.760)

to help diffuse this materialist worldview of reality

Robert Breedlove (3:33:56.080)

where we still think in kind of the Newtonian model

Lex Fridman (3:33:58.920)

that it's atoms and cause and effect.

Robert Breedlove (3:34:03.440)

I'd first recommend Jordan Peterson's book,

Lex Fridman (3:34:05.160)

Maps of Meaning.

Robert Breedlove (3:34:06.160)

It's a deep dive into mythology

Lex Fridman (3:34:11.240)

and how it's developed over the course of history

Lex Fridman (3:34:14.160)

and how it's reflected both in our social structures

Lex Fridman (3:34:17.260)

and our intra psychic nature really,

Lex Fridman (3:34:21.360)

and how they come to reflect one another in a way.

Lex Fridman (3:34:23.320)

Like the way we think again shapes the world

Lex Fridman (3:34:25.800)

and then the way the world is shaped,

Lex Fridman (3:34:26.960)

shapes the way we think.

Robert Breedlove (3:34:29.760)

That's an excellent book.

Lex Fridman (3:34:30.800)

It's very dense and difficult read.

Robert Breedlove (3:34:33.480)

Actually this trilogy is pretty brutal.

Lex Fridman (3:34:35.360)

Probably take you a year to read, hours a day.

Robert Breedlove (3:34:39.440)

The second one I mentioned earlier

Lex Fridman (3:34:40.640)

was Human Action by Mises.

Robert Breedlove (3:34:44.320)

The ultimate tome on Austrian economics

Lex Fridman (3:34:46.560)

will help explicate this realm of relevance.

Robert Breedlove (3:34:50.240)

I think that economics truly is where again,

Lex Fridman (3:34:56.040)

there are things and then these things become means or ends

Robert Breedlove (3:35:00.080)

once we channel our purpose through them.

Lex Fridman (3:35:03.200)

So this realm of non materialist relevance

Robert Breedlove (3:35:07.520)

that I think is really important to grasping economics

Lex Fridman (3:35:10.480)

at a first principles level,

Robert Breedlove (3:35:11.720)

I think that book lays it out tremendously.

Lex Fridman (3:35:15.400)

And then the last one would be,

Robert Breedlove (3:35:16.480)

I think I mentioned this at the beginning,

Lex Fridman (3:35:17.560)

was that book Lila by Robert Persig,

Robert Breedlove (3:35:19.960)

where he's making the case that value is fundamental.

Lex Fridman (3:35:23.800)

And all of these books,

Robert Breedlove (3:35:25.640)

they kind of all point to that actually.

Lex Fridman (3:35:27.560)

They're pointing back to value being the fundamental thing,

Robert Breedlove (3:35:31.080)

values expressed through moral action

Lex Fridman (3:35:35.320)

as being the fundamental substrate of reality.

Lex Fridman (3:35:37.920)

So if you're like me, I grew up quite scientific minded.

Lex Fridman (3:35:42.040)

It'll help diffuse some of that

Lex Fridman (3:35:43.320)

and maybe retrain you to the other side of reality.

Lex Fridman (3:35:47.520)

So you said these books are difficult.

Robert Breedlove (3:35:49.200)

Maybe you can comment on which aspect is difficult.

Lex Fridman (3:35:52.800)

Is it just the technical nature?

Lex Fridman (3:35:54.400)

Is it the length?

Lex Fridman (3:35:55.320)

Is it the depth of the ideas

Lex Fridman (3:35:56.880)

or how long it takes to integrate them?

Lex Fridman (3:35:58.880)

And more sort of importantly,

Robert Breedlove (3:36:01.720)

is there recommendation advice you can give

Lex Fridman (3:36:04.200)

on how to integrate these ideas,

Lex Fridman (3:36:09.480)

how to read, how to learn in the spaces there

Lex Fridman (3:36:13.840)

from your own life?

Lex Fridman (3:36:15.200)

Like how do you enjoy taking in ideas?

Lex Fridman (3:36:17.000)

And this could be for these books,

Lex Fridman (3:36:18.160)

but also in the Bitcoin world

Lex Fridman (3:36:21.120)

and reading a bunch of different ideas written by others,

Robert Breedlove (3:36:24.520)

just integrating stuff, even watching podcasts

Lex Fridman (3:36:28.200)

and all those kinds of things.

Robert Breedlove (3:36:29.680)

Yeah, I'm a reader.

Lex Fridman (3:36:31.440)

I love to read.

Robert Breedlove (3:36:33.720)

One of the most useful things I've ever done

Lex Fridman (3:36:35.960)

was take a speed reading course.

Robert Breedlove (3:36:38.920)

I actually think there's a version of this

Lex Fridman (3:36:40.120)

available on Tim Ferriss's website.

Robert Breedlove (3:36:41.640)

It's like a 30 minute speed reading course.

Lex Fridman (3:36:44.280)

It's all about eye movement.

Robert Breedlove (3:36:45.760)

Instead of moving your eye continuously line over line,

Lex Fridman (3:36:48.600)

it's more about jumping in your brain.

Robert Breedlove (3:36:50.600)

You can train your brain to just absorb words

Lex Fridman (3:36:53.560)

in their totality versus kind of reading word by word.

Lex Fridman (3:36:56.960)

And also not, I haven't fully taken that journey actually,

Lex Fridman (3:37:00.800)

but I remember taking a few steps on that journey,

Robert Breedlove (3:37:05.400)

realizing that I'm speaking inside my head.

Lex Fridman (3:37:08.640)

Yeah.

Robert Breedlove (3:37:09.480)

I'm saying the words inside my head

Lex Fridman (3:37:10.840)

and that's actually getting in the way.

Robert Breedlove (3:37:12.200)

That's right.

Lex Fridman (3:37:13.040)

So there's a lot of little hacks like that.

Robert Breedlove (3:37:15.080)

I maybe lazily, now that you mentioned,

Lex Fridman (3:37:17.880)

I'll have to revisit this.

Lex Fridman (3:37:19.320)

But I have convinced myself that I don't need to read faster

Lex Fridman (3:37:23.720)

because that's not ultimately the bottleneck.

Robert Breedlove (3:37:25.440)

The bottleneck is in me thinking about stuff.

Lex Fridman (3:37:28.360)

In fact, I like reading really slowly

Robert Breedlove (3:37:30.440)

or so I convinced myself.

Lex Fridman (3:37:32.800)

Because ultimately it's not about gaining more information.

Robert Breedlove (3:37:35.520)

It's about time spent thinking deeply.

Lex Fridman (3:37:38.680)

Yes, yes.

Lex Fridman (3:37:40.280)

But maybe that's just me being very lazy

Lex Fridman (3:37:43.280)

because yes, it's true.

Robert Breedlove (3:37:44.200)

It's important to think deeply,

Lex Fridman (3:37:45.480)

but maybe I could speed up the consumption of information.

Robert Breedlove (3:37:49.360)

It's fine.

Lex Fridman (3:37:50.440)

I like to be dynamic actually.

Lex Fridman (3:37:51.880)

So usually speed reading initially

Lex Fridman (3:37:55.320)

and that diffused that internal dialogue for me

Robert Breedlove (3:37:58.400)

because when I was reading one word at a time,

Lex Fridman (3:37:59.720)

I was having that too.

Robert Breedlove (3:38:00.560)

You almost get a feedback in your own head

Lex Fridman (3:38:02.080)

when you're reading the word out loud

Lex Fridman (3:38:03.240)

and it's clouding your thoughts.

Lex Fridman (3:38:04.640)

If you're speed reading, you can't do that.

Robert Breedlove (3:38:06.560)

You're taking in groups of words at a time

Lex Fridman (3:38:08.640)

so you can't internally verbalize it, I guess.

Lex Fridman (3:38:13.080)

And then I also am really big on annotating,

Lex Fridman (3:38:15.560)

underlining, writing in the margins.

Robert Breedlove (3:38:17.720)

I prefer a physical book,

Lex Fridman (3:38:20.000)

but I also read the Kindle a lot

Robert Breedlove (3:38:21.400)

because it's just so convenient.

Lex Fridman (3:38:23.120)

Anywhere you're waiting in line or every night before bed,

Robert Breedlove (3:38:25.440)

I'm reading my Kindle.

Lex Fridman (3:38:27.080)

And I also advocate rereading a lot.

Lex Fridman (3:38:30.120)

So if you found something that struck you at a deep level

Lex Fridman (3:38:34.560)

or you found particularly fascinating,

Robert Breedlove (3:38:36.080)

like you have to listen to that.

Lex Fridman (3:38:37.520)

That's your, I don't know, your mind or your spirit signal

Robert Breedlove (3:38:41.360)

that that is something meaningful to you

Lex Fridman (3:38:43.520)

and you should, to your point, reread it,

Robert Breedlove (3:38:46.320)

sit with it for a long time, write about it.

Lex Fridman (3:38:49.200)

And that becomes the ultimate triumvirate

Robert Breedlove (3:38:52.880)

of synthesizing an idea, actually.

Lex Fridman (3:38:55.000)

If you can read about it and then write about it

Lex Fridman (3:38:59.440)

and then go and talk about it,

Lex Fridman (3:39:01.000)

you get this crystallization of understanding

Robert Breedlove (3:39:03.040)

that's just not possible doing any one of the three

Lex Fridman (3:39:05.520)

or any two of the three.

Lex Fridman (3:39:08.120)

So I definitely highly recommend people to do that.

Lex Fridman (3:39:12.560)

And in terms of how are those books difficult?

Robert Breedlove (3:39:16.280)

I mean, and if you're reading a lot of books,

Lex Fridman (3:39:18.120)

are difficult, I mean, in every way,

Robert Breedlove (3:39:19.680)

they're all long books.

Lex Fridman (3:39:22.520)

In terms of density, I would say Lila is the less,

Robert Breedlove (3:39:26.600)

the least dense, maybe Maps of Meaning.

Lex Fridman (3:39:32.120)

I don't know, but Maps of Meaning

Lex Fridman (3:39:33.280)

and Human Action are both extremely dense.

Lex Fridman (3:39:35.760)

But they're just, I had to read those books very slow.

Robert Breedlove (3:39:40.160)

That you just have to take your time with them.

Lex Fridman (3:39:42.600)

To give you an idea with Jordan Peterson,

Robert Breedlove (3:39:44.040)

he's said this a lot with Maps of Meaning.

Lex Fridman (3:39:46.920)

He spent three hours a day writing for 15 years

Robert Breedlove (3:39:50.240)

to write that book.

Lex Fridman (3:39:51.160)

It's probably, I think it's a 600 page book.

Robert Breedlove (3:39:53.680)

He said he estimates he rewrote every sentence

Lex Fridman (3:39:55.720)

in the book 50 times, five, zero,

Robert Breedlove (3:39:58.920)

to try and get it just perfected.

Lex Fridman (3:40:01.840)

And when you read these sentences,

Robert Breedlove (3:40:05.040)

you can tell that he rewrote it 50 times.

Lex Fridman (3:40:08.640)

I've used actually Anki for spaced repetition.

Robert Breedlove (3:40:13.800)

It's like a piece of, it's an app.

Lex Fridman (3:40:15.560)

I'm not sure if you're familiar with it,

Lex Fridman (3:40:17.000)

but it allows you to load in facts or terms

Lex Fridman (3:40:22.040)

or entire paragraphs.

Lex Fridman (3:40:24.200)

And then it brings them, you review them every day

Lex Fridman (3:40:29.600)

and then it brings them up less and less often over time

Robert Breedlove (3:40:33.560)

as you show yourself being able to remember

Lex Fridman (3:40:36.160)

the thing that you wanted to memorize.

Lex Fridman (3:40:39.440)

And oftentimes when I'm reading,

Lex Fridman (3:40:41.320)

what I want to memorize is the key idea.

Lex Fridman (3:40:43.880)

But also like I use it for, I'm terrible with names.

Lex Fridman (3:40:47.160)

So I'm starting to use it for names too,

Robert Breedlove (3:40:49.240)

names of people, names of like people

Lex Fridman (3:40:52.040)

that I want to remember.

Lex Fridman (3:40:53.560)

And also throughout history and also in my own personal life

Lex Fridman (3:40:56.560)

but also events, you know, dates to me

Robert Breedlove (3:40:59.040)

are usually not important,

Lex Fridman (3:41:00.200)

but sometimes dates are really important.

Lex Fridman (3:41:03.040)

And so it's really useful.

Lex Fridman (3:41:04.440)

I recommend it highly.

Robert Breedlove (3:41:05.280)

Naval, I think mentioned a piece of software

Lex Fridman (3:41:08.680)

called Readwise or something like that,

Robert Breedlove (3:41:11.560)

that I hope I'm saying that correctly.

Lex Fridman (3:41:14.640)

It's something like that.

Lex Fridman (3:41:16.280)

And what it does is it goes to your highlights

Lex Fridman (3:41:18.920)

from your Kindle or the various places

Robert Breedlove (3:41:23.000)

where you highlight stuff that integrates with Goodreads.

Lex Fridman (3:41:27.760)

And it does the same kind of spaced repetition

Lex Fridman (3:41:29.960)

but for things you've highlighted.

Lex Fridman (3:41:31.640)

So it sends an email every day.

Robert Breedlove (3:41:35.960)

It's been really, I recommend it highly

Lex Fridman (3:41:38.360)

because it sends like to me an email form,

Robert Breedlove (3:41:43.440)

a selection of the things I've highlighted

Lex Fridman (3:41:45.360)

and previous things I've read.

Lex Fridman (3:41:47.120)

And it's like this weird like shock to your memory

Lex Fridman (3:41:52.360)

that sprinkles like I have probably way too much Orwell

Robert Breedlove (3:41:56.760)

in there and it just kind of like, it brings you back.

Lex Fridman (3:42:00.240)

And these ideas are, because what you realize,

Robert Breedlove (3:42:03.240)

depending on how you highlight, but at least for me,

Lex Fridman (3:42:07.280)

and I think it's probably true for a lot of people,

Robert Breedlove (3:42:08.880)

the things you've highlighted had at that moment

Lex Fridman (3:42:11.360)

and like an emotional impact on you.

Lex Fridman (3:42:13.840)

And so like these things are just like hitting you hard

Lex Fridman (3:42:16.200)

again, it's like, whoa, it might not be meaningful

Robert Breedlove (3:42:19.520)

to anyone else except you.

Lex Fridman (3:42:20.720)

And it's something I recommend.

Robert Breedlove (3:42:23.240)

You never know with these like hacks or tools and so on,

Lex Fridman (3:42:25.760)

like what's actually BS and what is amazing.

Lex Fridman (3:42:29.440)

And that one is kind of amazing.

Lex Fridman (3:42:31.360)

So at least for me, it works for me and Naval.

Robert Breedlove (3:42:34.600)

I think he's the one.

Lex Fridman (3:42:35.760)

Read wise you said. Read wise.

Robert Breedlove (3:42:37.920)

Or something close to that.

Lex Fridman (3:42:39.920)

It could be read something else,

Robert Breedlove (3:42:41.480)

like read wealth or something.

Lex Fridman (3:42:43.680)

The one other thing I really like,

Lex Fridman (3:42:46.840)

and this is more of a new one,

Lex Fridman (3:42:48.080)

is I used to always listen to music at the gym,

Lex Fridman (3:42:50.920)

but now I've just, because I'm so backlogged on podcasts,

Lex Fridman (3:42:54.280)

right, there's so many, I exclusively listen to podcasts

Robert Breedlove (3:42:59.160)

when I'm walking or when I'm at the gym,

Lex Fridman (3:43:00.440)

anytime I'm doing something that I can't read basically.

Lex Fridman (3:43:03.820)

And I think there's something really special

Lex Fridman (3:43:07.000)

about exercise and ideation.

Robert Breedlove (3:43:09.340)

I mean, I don't know if this happens to everyone,

Lex Fridman (3:43:12.360)

but my creative juices just go ballistic.

Robert Breedlove (3:43:14.480)

When I'm at the gym, like I hit a certain point of,

Lex Fridman (3:43:17.520)

I guess, heart rate and you're sweating enough,

Robert Breedlove (3:43:19.480)

then the ideas just start to flow.

Lex Fridman (3:43:21.760)

So I'm basically at the gym now listening to podcasts,

Robert Breedlove (3:43:25.440)

exercising as fast as I can to try to get to that state of,

Lex Fridman (3:43:30.880)

you know, where you're just straining,

Robert Breedlove (3:43:31.880)

your strenuous exercise, I guess you would say,

Lex Fridman (3:43:34.320)

and then I end up typing notes into my phone

Robert Breedlove (3:43:36.320)

as fast as I can with all these ideas that are flowing.

Lex Fridman (3:43:39.160)

So I've created a lot of good writing out of that.

Robert Breedlove (3:43:42.520)

Yeah, it's kind of work.

Lex Fridman (3:43:43.560)

So I do running quite a bit, so running outside,

Lex Fridman (3:43:47.900)

and I'll listen to, I've been, okay,

Lex Fridman (3:43:51.520)

I told myself this has been going on for about a year,

Robert Breedlove (3:43:55.000)

is I only listen, like the stuff that's either World War II

Lex Fridman (3:44:00.000)

or World War I related.

Lex Fridman (3:44:01.840)

So Hitler, Stalin, like difficult historical stuff.

Lex Fridman (3:44:09.800)

And also listen to brown noise.

Lex Fridman (3:44:13.160)

So those are the two modes.

Lex Fridman (3:44:14.480)

So brown noise helps me, this is like white noise,

Lex Fridman (3:44:18.420)

but like deeper, I guess, it helps me remove the world.

Lex Fridman (3:44:22.560)

And at the gym, there's a lot of distractions.

Robert Breedlove (3:44:24.840)

When you're running, there's a lot of distractions.

Lex Fridman (3:44:26.600)

It helps me remove the world.

Lex Fridman (3:44:27.680)

So one, I'll be listening to difficult historical ideas.

Lex Fridman (3:44:32.400)

And then when my mind is all of a sudden

Robert Breedlove (3:44:34.240)

starting to generate ideas,

Lex Fridman (3:44:36.480)

I'll listen to brown noise and then force myself to think.

Robert Breedlove (3:44:40.080)

It's kind of, it's meditative in a sense,

Lex Fridman (3:44:44.400)

and your mind wants to be lazy.

Robert Breedlove (3:44:46.440)

You want to, it's hard, man, like running and thinking

Lex Fridman (3:44:51.600)

in the sense that some of the ideas

Robert Breedlove (3:44:53.720)

that come into your head are pretty heavy.

Lex Fridman (3:44:56.240)

It's about your own life, your own demons come in there,

Lex Fridman (3:44:59.600)

but also just difficult ideas

Lex Fridman (3:45:01.600)

that require you thinking through

Lex Fridman (3:45:02.920)

and persevering through that,

Lex Fridman (3:45:05.440)

like not letting yourself get lazy

Lex Fridman (3:45:07.120)

and thinking through it has been really for me rewarding

Lex Fridman (3:45:10.480)

in the same way that you're saying it is for you.

Robert Breedlove (3:45:13.920)

It's true that like podcasts and music,

Lex Fridman (3:45:16.840)

like shallow, like funny podcasts or music

Robert Breedlove (3:45:20.920)

have been a kind of filler distraction.

Lex Fridman (3:45:23.360)

But informational podcasts, like podcasts

Robert Breedlove (3:45:27.000)

that have some depths of ideas or audio books

Lex Fridman (3:45:30.920)

have been truly rewarding.

Robert Breedlove (3:45:32.600)

I try to listen now less and less to podcasts

Lex Fridman (3:45:34.960)

that are just fun,

Robert Breedlove (3:45:37.760)

because I feel like I enjoy it too much

Lex Fridman (3:45:39.600)

and I don't allow my mind to get bored

Lex Fridman (3:45:41.840)

and to think through stuff, to explore ideas.

Lex Fridman (3:45:45.000)

It's so easy to fill the space

Robert Breedlove (3:45:49.240)

that usually would be filled with thought

Lex Fridman (3:45:52.680)

and instead fill it with fun podcasts.

Robert Breedlove (3:45:55.680)

Like there's a bunch of comedy podcasts I really enjoy.

Lex Fridman (3:45:58.280)

So there's value to that, of course,

Lex Fridman (3:46:00.240)

but you have to realize it's entertainment.

Lex Fridman (3:46:02.200)

It's not, you don't get much value except entertainment.

Robert Breedlove (3:46:07.280)

Right, right.

Lex Fridman (3:46:08.120)

And there's utility to the boredom too, I think,

Robert Breedlove (3:46:10.800)

where to give your mind the space,

Lex Fridman (3:46:15.360)

I guess your subconscious,

Lex Fridman (3:46:16.440)

maybe the space to chew on some of these problems, right?

Lex Fridman (3:46:19.080)

Where you've imbibed so much knowledge,

Robert Breedlove (3:46:21.960)

you've highlighted and thought about something,

Lex Fridman (3:46:23.400)

but then you need to stop thinking about it for a while

Lex Fridman (3:46:25.720)

and let it marinate in the subconscious.

Lex Fridman (3:46:27.920)

And then these flashes of insight

Robert Breedlove (3:46:30.880)

that people have described,

Lex Fridman (3:46:32.080)

sometimes I get them in the middle of the night,

Robert Breedlove (3:46:33.440)

like I just wake up from a dream and have them

Lex Fridman (3:46:35.040)

and I got to write it down

Robert Breedlove (3:46:35.880)

or sometimes just in nature taking a walk.

Lex Fridman (3:46:38.760)

But I think that's very important too.

Robert Breedlove (3:46:40.440)

We can't just brute force our way into understanding.

Lex Fridman (3:46:44.040)

There's this interplay between

Robert Breedlove (3:46:46.040)

kind of the brute force reading intake

Lex Fridman (3:46:47.680)

and then just relaxing, meditating, sleeping, being bored,

Robert Breedlove (3:46:52.280)

letting your subconscious do the heavy lifting.

Lex Fridman (3:46:56.120)

And there's, you should be aware of the fact

Robert Breedlove (3:46:59.200)

that there's a war for your attention going on.

Lex Fridman (3:47:01.120)

So there's a lot of,

Robert Breedlove (3:47:02.720)

there's been better and better and better mechanisms

Lex Fridman (3:47:05.520)

that are designed to steal your attention.

Lex Fridman (3:47:08.480)

So I kind of see it as a war zone

Lex Fridman (3:47:10.840)

between my right for boredom

Lex Fridman (3:47:15.240)

and the internet wanting your attention.

Lex Fridman (3:47:17.240)

In fact, Clubhouse as an app has been,

Robert Breedlove (3:47:21.960)

I'm probably not gonna use Clubhouse much anymore.

Lex Fridman (3:47:24.560)

There's some aspect of my own inner loneliness

Lex Fridman (3:47:27.760)

and whatever it is that pulled me into Clubhouse

Lex Fridman (3:47:31.120)

a little bit too much to where it robbed me

Robert Breedlove (3:47:33.480)

from that lonely time alone

Lex Fridman (3:47:36.400)

where I sit and listen to Bruce Springsteen

Lex Fridman (3:47:38.080)

and think about life, right?

Lex Fridman (3:47:39.640)

So I wanna.

Robert Breedlove (3:47:40.640)

That's way more important.

Lex Fridman (3:47:41.680)

That's way, well yeah, at least it's all in balance

Robert Breedlove (3:47:44.520)

because there is a Clubhouse like a lot

Lex Fridman (3:47:47.200)

of these social networks when you use right

Robert Breedlove (3:47:48.760)

can be a way to discover new ideas, new people.

Lex Fridman (3:47:52.120)

But the boredom is just being alone

Robert Breedlove (3:47:55.160)

with your thoughts is priceless.

Lex Fridman (3:47:57.320)

Absolutely.

Lex Fridman (3:47:58.160)

And you gotta know yourself, right?

Lex Fridman (3:47:59.520)

Like it took me a long time to realize I need solitude.

Robert Breedlove (3:48:03.200)

Like just how I'm wired, how I'm built.

Lex Fridman (3:48:05.320)

I need like an hour a day solitude.

Lex Fridman (3:48:07.400)

So you gotta listen to that part of yourself.

Lex Fridman (3:48:08.860)

You might be compromising something like that

Robert Breedlove (3:48:11.740)

where you feel like you always need to be

Lex Fridman (3:48:12.960)

with your girlfriend or whatever it may be.

Lex Fridman (3:48:14.560)

But I would suggest listening to that voice.

Lex Fridman (3:48:18.120)

Yeah, I try to, I tried to remember things

Robert Breedlove (3:48:20.840)

that made me feel good over time.

Lex Fridman (3:48:23.020)

Like longterm had positive impact

Lex Fridman (3:48:25.400)

and longterm had negative impact

Lex Fridman (3:48:27.680)

and do more of the former and less of the latter.

Robert Breedlove (3:48:31.120)

We don't often think like that.

Lex Fridman (3:48:33.160)

You know, we talked offline about like carnivore diets

Robert Breedlove (3:48:35.560)

for example, I try to remember

Lex Fridman (3:48:38.880)

that carbs don't make me feel good.

Robert Breedlove (3:48:40.720)

Yeah.

Lex Fridman (3:48:41.960)

In the moment it's hard to remember that.

Robert Breedlove (3:48:43.520)

It's hard, it's hard.

Lex Fridman (3:48:45.000)

But you have to remember that that's the case.

Lex Fridman (3:48:47.920)

And in the same way, exercise,

Lex Fridman (3:48:51.880)

it's hard to remember that exercise makes me feel good.

Lex Fridman (3:48:56.160)

Like especially when it's time to go to the gym, right?

Lex Fridman (3:48:58.000)

Especially when it's time to go to the gym.

Lex Fridman (3:48:59.360)

But you should remember that

Lex Fridman (3:49:00.560)

because the kind of person you are without exercise,

Robert Breedlove (3:49:03.840)

for me, just like you beautifully said

Lex Fridman (3:49:06.360)

that you have to know yourself.

Robert Breedlove (3:49:07.400)

The kind of person I am without exercise

Lex Fridman (3:49:10.560)

is a less good person, a person I'm less proud of.

Robert Breedlove (3:49:15.640)

The food thing is so hard.

Lex Fridman (3:49:16.920)

By the way, I still, you know,

Robert Breedlove (3:49:19.840)

I can't tell you how many times I've learned the lesson,

Lex Fridman (3:49:21.840)

like don't eat that.

Lex Fridman (3:49:23.520)

But then, you know, you go a few weeks

Lex Fridman (3:49:25.160)

of not eating whatever that is,

Lex Fridman (3:49:26.960)

and you're feeling good.

Lex Fridman (3:49:28.280)

And then you're, I don't know,

Robert Breedlove (3:49:29.840)

something creeps up inside you.

Lex Fridman (3:49:30.880)

Like, ah, you could just have one or you could just do this.

Lex Fridman (3:49:33.080)

But for me, it's sugar.

Lex Fridman (3:49:34.160)

Like sugar just makes me feel terrible.

Lex Fridman (3:49:36.880)

But I always, not always, but if it's been a long time,

Lex Fridman (3:49:40.040)

I start to make that exception in my mind.

Robert Breedlove (3:49:41.560)

Like, oh, you can have a little bit.

Lex Fridman (3:49:43.000)

And then I eat it and I feel terrible.

Lex Fridman (3:49:44.120)

So I don't know how many times I've done that dance,

Lex Fridman (3:49:45.880)

but it's not cool.

Robert Breedlove (3:49:47.400)

Well, it depends on how painful it is

Lex Fridman (3:49:48.760)

and then you learn the lesson.

Robert Breedlove (3:49:49.960)

I actually embraced the fact

Lex Fridman (3:49:51.800)

that I'll never learn the lesson with vodka.

Robert Breedlove (3:49:54.560)

Every time I drink, especially with Russians,

Lex Fridman (3:49:57.720)

is like, I quit drinking every time.

Lex Fridman (3:50:00.280)

And then I forget, there's like a slow drop off.

Lex Fridman (3:50:02.880)

It'll be like two weeks and then.

Robert Breedlove (3:50:05.000)

Na zdorovie.

Lex Fridman (3:50:05.840)

Na zdorovie, very good.

Lex Fridman (3:50:08.560)

So it never makes you feel good.

Lex Fridman (3:50:12.040)

It never results in anything good

Robert Breedlove (3:50:15.200)

except the beautiful social chaos,

Lex Fridman (3:50:20.040)

which is ultimately somehow, there's value to chaos too.

Robert Breedlove (3:50:24.680)

There's value to that.

Lex Fridman (3:50:25.720)

Whatever the hell stupid stuff you do when you get trashed.

Robert Breedlove (3:50:29.120)

The over the top emotion of love usually

Lex Fridman (3:50:32.840)

or whatever camaraderie, there's value to that too.

Robert Breedlove (3:50:36.160)

Like as I get older, I realize,

Lex Fridman (3:50:39.600)

because the world,

Robert Breedlove (3:50:43.040)

sometimes especially when you get older

Lex Fridman (3:50:44.400)

and the world wants you to be an adult,

Robert Breedlove (3:50:47.520)

in order to maintain the youthful spirit,

Lex Fridman (3:50:49.440)

you have to use all the tools you can.

Robert Breedlove (3:50:51.720)

Alcohol is one of them.

Lex Fridman (3:50:53.680)

To do all the stupid shit you can,

Robert Breedlove (3:50:55.480)

even if you're like getting older.

Lex Fridman (3:50:57.920)

To lower the inhibitions.

Robert Breedlove (3:51:00.000)

Again, it's that taste of uncertainty

Lex Fridman (3:51:01.920)

that is the sweetness of life, right?

Robert Breedlove (3:51:03.440)

To be able to go out and be a flaneur at a party

Lex Fridman (3:51:06.520)

and not really know what you're gonna do.

Lex Fridman (3:51:08.160)

And we have this draw to the wild side of life.

Lex Fridman (3:51:12.800)

As much as we try and build up order around ourselves,

Robert Breedlove (3:51:15.400)

I think there's always gonna be an appetite for that.

Lex Fridman (3:51:18.560)

I've always, most of my life,

Robert Breedlove (3:51:21.080)

I've always been a social drinker,

Lex Fridman (3:51:23.000)

but I actually gave up alcohol a year ago.

Lex Fridman (3:51:25.280)

And I would add that to the idea,

Lex Fridman (3:51:30.880)

the repertoire for dealing with bigger ideas

Robert Breedlove (3:51:33.160)

because alcohol is fun, it's amazing, good times.

Lex Fridman (3:51:39.240)

It can be analgesic, it can give you all these benefits

Robert Breedlove (3:51:42.320)

if you use the right amounts.

Lex Fridman (3:51:43.880)

But I got to the point personally

Robert Breedlove (3:51:46.520)

where I was trying to wrestle with these ideas

Lex Fridman (3:51:48.400)

that are just so much bigger than me.

Lex Fridman (3:51:50.280)

And I have this backlog of books

Lex Fridman (3:51:52.400)

that was growing faster than I could read them

Robert Breedlove (3:51:55.160)

that I just reached a point where I decided

Lex Fridman (3:51:58.400)

I wanted to start making sacrifices toward attaining that.

Lex Fridman (3:52:01.520)

And alcohol was just an easy one.

Lex Fridman (3:52:03.680)

It's you spend,

Robert Breedlove (3:52:05.960)

even if you just drink socially on the weekends,

Lex Fridman (3:52:08.160)

you're probably spending five to 10 hours drinking

Lex Fridman (3:52:12.280)

and then maybe another, what?

Lex Fridman (3:52:13.560)

Five to 10 hours recovering perhaps on the day after.

Lex Fridman (3:52:19.120)

So it was a difficult transition initially,

Lex Fridman (3:52:23.000)

but once you get through a couple of months,

Robert Breedlove (3:52:25.880)

I feel amazing without it.

Lex Fridman (3:52:27.200)

I sleep better than ever.

Robert Breedlove (3:52:28.760)

My workouts are better than ever.

Lex Fridman (3:52:30.680)

I'm sharper than ever.

Robert Breedlove (3:52:31.640)

I'm more lucid.

Lex Fridman (3:52:33.040)

So I'm not trying to be a proponent for not drinking,

Lex Fridman (3:52:35.840)

but I just want to say.

Lex Fridman (3:52:36.680)

But you're a proponent for sacrifice.

Robert Breedlove (3:52:38.200)

I am a big proponent for sacrifice, yes.

Lex Fridman (3:52:40.840)

Is there advice you would give to a young person today

Robert Breedlove (3:52:43.680)

curious about Bitcoin,

Lex Fridman (3:52:45.280)

curious about how they succeed in the world

Lex Fridman (3:52:50.560)

or both career wise and just in life in general?

Lex Fridman (3:52:55.440)

I mean, the strongest piece of advice I have for,

Robert Breedlove (3:52:58.360)

this is beyond just Bitcoin.

Lex Fridman (3:53:01.120)

This is you managing your own personal and financial affairs

Robert Breedlove (3:53:05.920)

is that you need to invest in knowledge first.

Lex Fridman (3:53:11.640)

It's not good enough to just follow the crowd

Lex Fridman (3:53:15.720)

and buy a 60, 40 portfolio and put it in a Roth RA

Lex Fridman (3:53:20.040)

and plan on social security.

Robert Breedlove (3:53:22.120)

I mean, the world's changing much faster

Lex Fridman (3:53:25.640)

than any existing institution

Robert Breedlove (3:53:28.920)

is going to be able to keep up with.

Lex Fridman (3:53:31.160)

So that's why I like,

Robert Breedlove (3:53:33.400)

I mean, that's why I named the show,

Lex Fridman (3:53:34.600)

the question, what is money?

Robert Breedlove (3:53:35.600)

Like, I think that to me is the rabbit

Lex Fridman (3:53:38.960)

that took me down the rabbit holes.

Robert Breedlove (3:53:40.240)

Like just asking that question naturally progressed

Lex Fridman (3:53:43.880)

to these other questions.

Lex Fridman (3:53:45.040)

Like what is value?

Lex Fridman (3:53:46.160)

What is government?

Lex Fridman (3:53:47.160)

What is the purpose of society?

Lex Fridman (3:53:50.320)

Speech, all of these things.

Lex Fridman (3:53:52.360)

So I would encourage people to arm yourself

Lex Fridman (3:53:57.480)

with knowledge and study.

Lex Fridman (3:53:58.600)

And like that, a lot of financial people

Lex Fridman (3:54:01.600)

always give you a line of advice

Lex Fridman (3:54:04.200)

and then say, this is not financial advice.

Lex Fridman (3:54:06.000)

I'm like, this is financial advice.

Robert Breedlove (3:54:07.600)

Like study, study, learn.

Lex Fridman (3:54:12.040)

Knowledge is power.

Robert Breedlove (3:54:13.200)

Yeah.

Lex Fridman (3:54:14.040)

This is official financial advice.

Lex Fridman (3:54:16.040)

And you're exercising your divine trait,

Lex Fridman (3:54:19.120)

which is the logos, right?

Robert Breedlove (3:54:22.320)

That we are these animals

Lex Fridman (3:54:24.920)

that can tell and believe stories.

Lex Fridman (3:54:26.440)

So it feels like almost a sacred duty

Lex Fridman (3:54:28.960)

to really sharpen that part of ourselves

Lex Fridman (3:54:31.680)

and use it to create the best world possible.

Lex Fridman (3:54:36.960)

And then the second one was the,

Robert Breedlove (3:54:39.000)

I think health and fitness stuff.

Lex Fridman (3:54:40.560)

I was, maybe everyone does this in their 20s.

Robert Breedlove (3:54:45.960)

They just live a little fast and beat themselves up.

Lex Fridman (3:54:49.440)

Not that I wasn't, like I was living well

Lex Fridman (3:54:54.120)

and successful by a lot of measures,

Lex Fridman (3:54:58.280)

but I wish I had maybe got my act together

Robert Breedlove (3:55:00.360)

a little bit sooner.

Lex Fridman (3:55:04.400)

I just think.

Robert Breedlove (3:55:05.240)

Health wise, morality wise.

Lex Fridman (3:55:07.480)

Yeah, drinking, I think morality and eating.

Robert Breedlove (3:55:11.320)

I just was kind of doing whatever I wanted in some ways.

Lex Fridman (3:55:14.840)

Let's say.

Robert Breedlove (3:55:16.520)

Is there a value to a trajectory

Lex Fridman (3:55:18.000)

that includes a lot of mistakes?

Lex Fridman (3:55:19.880)

So maybe you're supposed to make the mistakes in your 20s.

Lex Fridman (3:55:22.520)

That's a great point.

Robert Breedlove (3:55:23.360)

Maybe the 20s are all about the mistakes.

Lex Fridman (3:55:25.480)

Accumulate the most mistakes possible.

Robert Breedlove (3:55:27.000)

Yeah, I don't.

Lex Fridman (3:55:28.000)

As quickly as possible.

Robert Breedlove (3:55:30.640)

I don't regret any of it,

Lex Fridman (3:55:32.240)

but now that I'm kind of in this place where I feel good

Lex Fridman (3:55:35.600)

and I know the value of a good night's sleep

Lex Fridman (3:55:37.680)

and just, I've more deeply explored my own potential

Robert Breedlove (3:55:42.240)

that I feel maybe a little regretful

Lex Fridman (3:55:44.120)

that I didn't do this earlier is all I'm saying.

Lex Fridman (3:55:46.160)

So maybe just exploring different sides of yourself.

Lex Fridman (3:55:50.560)

See what it's like to go and make a bunch of mistakes

Lex Fridman (3:55:52.640)

and be wild and crazy

Lex Fridman (3:55:53.920)

and then maybe try to walk the straight and narrow

Robert Breedlove (3:55:55.360)

for a few months and just see what it's like.

Lex Fridman (3:55:58.360)

There's probably a guy doing vodka shots right now

Robert Breedlove (3:56:02.120)

listening to this podcast with his buddies

Lex Fridman (3:56:03.960)

and if you are, please take a shot for us

Robert Breedlove (3:56:07.520)

for all the mistakes you should make in your 20s.

Lex Fridman (3:56:11.240)

And what about love?

Robert Breedlove (3:56:18.000)

We talked about money is ultimately a mechanism

Lex Fridman (3:56:21.880)

by which you can pave a moral path through life.

Robert Breedlove (3:56:29.640)

To me, one of the purest expressions

Lex Fridman (3:56:31.720)

that is love broadly defined for a family, for others,

Robert Breedlove (3:56:36.080)

for knowledge, for the world,

Lex Fridman (3:56:38.080)

is basically an optimistic open view to the world

Robert Breedlove (3:56:40.840)

that embraces all that is beautiful about this world.

Lex Fridman (3:56:44.800)

So do you think about love often in a personal sense,

Robert Breedlove (3:56:51.200)

romantic, family, friendship, and in the broad sense

Lex Fridman (3:56:54.920)

about its value in a successful life?

Robert Breedlove (3:56:59.920)

Yeah, of course.

Lex Fridman (3:57:01.440)

I'm blessed to have a two and a half year old daughter

Lex Fridman (3:57:04.600)

and love is a word we throw around.

Lex Fridman (3:57:09.160)

I love these potato chips, I love you, man.

Robert Breedlove (3:57:11.400)

I love you, my daughter.

Lex Fridman (3:57:12.760)

It's got so many different intensities,

Robert Breedlove (3:57:15.560)

I guess you might say.

Lex Fridman (3:57:19.840)

I don't know, my intuition is that

Robert Breedlove (3:57:23.480)

it is something very fundamental to the universe.

Lex Fridman (3:57:27.200)

Again, I know words don't do it justice,

Lex Fridman (3:57:29.120)

but if we just proxy love with selfless action,

Lex Fridman (3:57:34.320)

the whole damn universe is selflessly acting, right?

Robert Breedlove (3:57:38.400)

It's just unfolding and it may sound a bit hippy dippy,

Lex Fridman (3:57:43.760)

but my intuition is just that love

Robert Breedlove (3:57:45.160)

is the core of it somehow.

Lex Fridman (3:57:48.920)

I don't have anything to back that up really, it's just.

Robert Breedlove (3:57:51.920)

In the way you're framing it, it's making me think

Lex Fridman (3:57:55.160)

that love, we talked about sort of meditation,

Robert Breedlove (3:58:00.040)

is as opposed to thinking from an egocentric perspective

Lex Fridman (3:58:05.680)

of you, the individual operating in this world,

Robert Breedlove (3:58:08.280)

is allowing you to be empathetic towards the world

Lex Fridman (3:58:10.960)

and thereby think of the universe,

Robert Breedlove (3:58:13.440)

think of the world acting through you.

Lex Fridman (3:58:15.840)

Almost like accepting this notion that ideas have you,

Robert Breedlove (3:58:20.680)

you don't have ideas,

Lex Fridman (3:58:22.840)

that you're not existing in the universe,

Robert Breedlove (3:58:25.240)

the universe is existing through you.

Lex Fridman (3:58:27.240)

It's sort of like, that's what selfless in that context means

Robert Breedlove (3:58:32.400)

is like embracing that thought.

Lex Fridman (3:58:34.600)

That's a weird thought.

Robert Breedlove (3:58:36.560)

It's a weird thought that we're just here for a little bit

Lex Fridman (3:58:38.640)

of time, these meat vehicles, receptacles,

Lex Fridman (3:58:45.120)

and this much bigger thing is just using us,

Lex Fridman (3:58:51.560)

not in a malevolent way, but just like a river flows,

Robert Breedlove (3:58:55.960)

is using us to create more and more beautiful things.

Lex Fridman (3:58:59.160)

Yes, yes, more and more beautiful things.

Lex Fridman (3:59:01.920)

We are the universe experiencing itself, frankly, right?

Lex Fridman (3:59:06.120)

So.

Robert Breedlove (3:59:06.960)

That's a trippy thought, man.

Lex Fridman (3:59:08.160)

Yeah.

Robert Breedlove (3:59:09.480)

That in some sense the universe created us

Lex Fridman (3:59:12.200)

to experience itself.

Lex Fridman (3:59:13.800)

And we are one of the highest forms of beauty

Lex Fridman (3:59:17.800)

that nature has created, right?

Robert Breedlove (3:59:19.280)

If we just think one of the most complex

Lex Fridman (3:59:23.320)

and adaptive thing, we're a reflection of nature.

Lex Fridman (3:59:26.640)

And another thing that comes to mind here is that

Lex Fridman (3:59:30.440)

Dalio has this quote where he says, truth or more accurately,

Robert Breedlove (3:59:36.360)

an accurate depiction of reality is necessary

Lex Fridman (3:59:39.600)

for any good outcome.

Lex Fridman (3:59:42.400)

So when we think that love or value is primary,

Lex Fridman (3:59:47.400)

I think that too reinforces this thesis

Robert Breedlove (3:59:49.880)

that acting out of love or acting out of proper moral action,

Lex Fridman (3:59:54.840)

you're best reflecting the fundamental nature of reality.

Robert Breedlove (3:59:58.320)

Therefore, you're best creating the best possible outcomes

Lex Fridman (40:02.400)

You know, talking about sovereignty and individualism,

Robert Breedlove (40:06.280)

there might need to be some rethinking here

Lex Fridman (40:10.680)

about what is actually the basic individual entity

Robert Breedlove (40:13.940)

that is to be sovereign.

Lex Fridman (40:15.600)

Like maybe our biological meat vehicles

Robert Breedlove (40:20.760)

were like way overly attached to them.

Lex Fridman (40:25.220)

Like maybe, especially with genetics

Lex Fridman (40:28.040)

and all those kinds of things,

Lex Fridman (40:29.000)

or artificial intelligence, or living more and more

Robert Breedlove (40:31.120)

in virtual worlds will become detached

Lex Fridman (40:34.200)

from that kind of idea.

Lex Fridman (40:35.860)

So for example, if I can clone you,

Lex Fridman (40:38.280)

you know, make one million robbers,

Robert Breedlove (40:42.280)

and, you know, but you'll all have the same idea,

Lex Fridman (40:46.160)

what is your real value as the,

Robert Breedlove (40:48.880)

like I could just shoot you,

Lex Fridman (40:50.000)

and there'll still be 999 of you,

Lex Fridman (40:52.840)

but the idea is the important thing,

Lex Fridman (40:55.200)

the things you believe, so.

Robert Breedlove (40:58.260)

I would argue that I don't know,

Lex Fridman (41:00.200)

even if you clone someone perfectly,

Robert Breedlove (41:02.080)

I don't think you can reproduce the individual themselves,

Lex Fridman (41:05.500)

because we're all a product of nature and nurture, right?

Lex Fridman (41:09.000)

So my particular concourse of experiences,

Lex Fridman (41:12.380)

the path dependence that I represent cannot be replicated,

Robert Breedlove (41:15.800)

nor can anyone's for that matter.

Lex Fridman (41:17.560)

Well, that's a hypothesis, so.

Robert Breedlove (41:20.520)

True.

Lex Fridman (41:21.360)

That's of course a human meat bag would say.

Robert Breedlove (41:27.240)

Good point.

Lex Fridman (41:29.640)

Like desperate trying to preserve himself.

Robert Breedlove (41:31.920)

You know, I think it reduces

Lex Fridman (41:33.960)

to some fundamental questions about what is consciousness,

Lex Fridman (41:36.440)

and whether that can be cloned.

Lex Fridman (41:38.000)

All those kind of, you know,

Robert Breedlove (41:39.200)

it gets to the core of what it is to be human.

Lex Fridman (41:41.880)

What are the things that make you particularly you?

Robert Breedlove (41:45.160)

Yeah, I think it would assume

Lex Fridman (41:46.880)

kind of a materialist viewpoint on reality,

Lex Fridman (41:49.200)

and that if you could reproduce every atom of an individual

Lex Fridman (41:52.160)

that you would have their experience encapsulated in that.

Robert Breedlove (41:55.160)

And, you know, Hoffman's, which his book is very radical,

Lex Fridman (41:58.620)

he argues that space and time is not an objective reality,

Robert Breedlove (42:03.620)

it's a biological interface.

Lex Fridman (42:06.040)

So we are scanning our environment for fitness payoffs,

Lex Fridman (42:11.080)

and this space and time is the rendering

Lex Fridman (42:13.520)

specific to human beings

Robert Breedlove (42:15.040)

that allows us to navigate reality effectively.

Lex Fridman (42:18.960)

So the further argument would be

Robert Breedlove (42:20.840)

that we all have pretty similar interfaces,

Lex Fridman (42:23.240)

but they're all slightly different too,

Robert Breedlove (42:25.000)

because we're all, you know, adapting in different ways,

Lex Fridman (42:27.120)

and that different animals have their own unique interfaces.

Lex Fridman (42:30.280)

So we have a certain amount of photoreceptors in our eye,

Lex Fridman (42:32.780)

whereas I think the number is three, might be five,

Robert Breedlove (42:35.920)

or something like the mantis shrimp has like seven or nine.

Lex Fridman (42:39.320)

So they can see,

Lex Fridman (42:40.960)

and we only see one 10 trillionth of the light spectrum.

Lex Fridman (42:46.960)

So talk about a tiny fraction.

Robert Breedlove (42:48.640)

I mean, one 10 trillionth is a very minuscule number,

Lex Fridman (42:51.640)

and that makes up all of the light

Robert Breedlove (42:53.340)

that we can interpret with our eyes.

Lex Fridman (42:55.320)

But something like a mantis shrimp

Robert Breedlove (42:56.480)

could see, you know, much more of that.

Lex Fridman (42:58.760)

So I think there's this, we're very conditioned

Robert Breedlove (43:04.160)

to have a fully materialist viewpoint on reality today,

Lex Fridman (43:07.280)

where we think, you know,

Robert Breedlove (43:10.280)

the atomic clockwork kind of universe.

Lex Fridman (43:12.940)

But I think there's, I don't think that's true exactly.

Lex Fridman (43:16.460)

And another school that goes into that

Lex Fridman (43:19.740)

is actually Austrian economics,

Robert Breedlove (43:22.000)

where we could say that, you know,

Lex Fridman (43:24.640)

we mentioned earlier that an asset is not property.

Robert Breedlove (43:27.580)

It's actually based on the relationship

Lex Fridman (43:29.120)

between the individual and the property.

Robert Breedlove (43:32.720)

There's this whole realm of relevance associated with,

Lex Fridman (43:39.860)

we're all moving through life

Robert Breedlove (43:41.600)

in the course of a goal directed action.

Lex Fridman (43:43.540)

So when we walk across a room, I go from A to B,

Robert Breedlove (43:47.400)

it's because I valued B more than A.

Lex Fridman (43:50.160)

So value is inseparable from human action.

Robert Breedlove (43:52.920)

We have a rank ordered value system in our mind,

Lex Fridman (43:56.160)

each of us, and we're constantly taking action

Robert Breedlove (43:58.360)

in accordance with those rank values.

Lex Fridman (44:01.500)

Anything that accelerates us on the course

Robert Breedlove (44:04.560)

of our goal directed action towards our goal is useful.

Lex Fridman (44:09.520)

Anything that impedes us, or we could say is valuable,

Robert Breedlove (44:12.720)

anything that impedes us is actually obstructing to value.

Lex Fridman (44:16.200)

And anything that's irrelevant is just valueless.

Lex Fridman (44:19.160)

So this table that we're using right now,

Lex Fridman (44:23.880)

like this is an accessory to UNI

Robert Breedlove (44:26.360)

because it's holding this paper

Lex Fridman (44:27.480)

that's holding the information

Robert Breedlove (44:28.480)

that's guiding our conversation.

Lex Fridman (44:30.320)

But we could pay someone $100 to jump over this table.

Lex Fridman (44:34.320)

And this table could simultaneously be an accessory to UNI

Lex Fridman (44:37.080)

and an obstacle to someone else.

Lex Fridman (44:39.500)

So it's this domain, this silent contention of willpower

Lex Fridman (44:43.880)

and agendas occurring across the face of the earth

Robert Breedlove (44:46.740)

that is what Austrian economics really looks at.

Lex Fridman (44:50.040)

It's the realm of human action, as they call it.

Robert Breedlove (44:54.040)

It's called praxeology.

Lex Fridman (44:55.560)

So it's a non materialist viewpoint on reality

Lex Fridman (44:58.560)

and that things, we think in terms of matter being reality,

Lex Fridman (45:03.200)

but it's often more so in the sphere of human action,

Lex Fridman (45:06.160)

what matters, that is reality.

Lex Fridman (45:08.620)

It's the relevance of a thing

Robert Breedlove (45:10.240)

to the course of one's goal directed action.

Lex Fridman (45:12.400)

And that's ultimately exists in the space of ideas.

Robert Breedlove (45:15.960)

Yes.

Lex Fridman (45:16.940)

Not in the space of physical matter.

Lex Fridman (45:19.040)

And just to jump back to this line here,

Lex Fridman (45:20.400)

I think his fundamental line here is the question is,

Robert Breedlove (45:24.620)

talking about universal Darwinism as an asset,

Lex Fridman (45:26.880)

what does it leave behind?

Robert Breedlove (45:28.360)

I've tried to show that once it passes through everything,

Lex Fridman (45:30.760)

we're left with stronger, sounder versions

Robert Breedlove (45:32.920)

of our most useful ideas.

Lex Fridman (45:35.320)

That's the key point to me.

Lex Fridman (45:36.520)

And that ideas and information, so far as we can tell,

Lex Fridman (45:40.400)

are the most fundamental substrate of reality.

Lex Fridman (45:44.360)

And information itself, back to entropy,

Lex Fridman (45:47.560)

information is the resolution of entropy.

Lex Fridman (45:50.320)

That's what the bit is, right?

Lex Fridman (45:51.560)

It's a one or a zero.

Robert Breedlove (45:52.440)

Whatever reduces your entropy by half is a bit.

Lex Fridman (45:55.040)

And we measure information in bits.

Robert Breedlove (45:57.480)

So.

Lex Fridman (45:58.640)

And you're right.

Robert Breedlove (45:59.760)

People don't have ideas, ideas have people.

Lex Fridman (46:02.840)

Honestly, it's a really profound idea

Robert Breedlove (46:07.080)

or a statement about reality, a reframing of reality.

Lex Fridman (46:13.160)

If we're actually being deeply honest about it,

Robert Breedlove (46:15.320)

it's quite painful.

Lex Fridman (46:17.240)

I do appreciate that you defended

Robert Breedlove (46:19.280)

your biological meatbag earlier,

Lex Fridman (46:21.760)

but it seems like ideas are the things that have power.

Robert Breedlove (46:26.020)

That me, Lex, for example, is worthless.

Lex Fridman (46:31.040)

And relative to the ideas that used my brain

Robert Breedlove (46:35.820)

for a bit of a time.

Lex Fridman (46:37.600)

But so far as we know, only human beings

Robert Breedlove (46:40.800)

can generate and share ideas.

Lex Fridman (46:42.400)

So you can't say Lex is worthless.

Robert Breedlove (46:44.440)

Like you are the node of the idea sphere.

Lex Fridman (46:47.960)

I'm the newest fear.

Robert Breedlove (46:49.080)

So.

Lex Fridman (46:51.120)

What is it?

Robert Breedlove (46:52.040)

From a Bitcoin perspective, I'm like, I'm mining.

Lex Fridman (46:55.160)

I'm solving the cryptographic problem and generate.

Robert Breedlove (47:01.040)

In that sense, I'm a useful node.

Lex Fridman (47:03.200)

Yeah, you're competing to solve the puzzle of entropy,

Lex Fridman (47:06.560)

right?

Lex Fridman (47:07.400)

And when you do solve it, it benefits the entire network.

Lex Fridman (47:09.620)

But I guess from my perspective,

Lex Fridman (47:13.320)

just because just working in AI,

Robert Breedlove (47:15.400)

I'm looking at the longterm vision.

Lex Fridman (47:17.600)

I see us humans and AI systems as really the same

Lex Fridman (47:22.500)

and AI systems ultimately as something

Lex Fridman (47:25.000)

that supersedes humans.

Lex Fridman (47:27.120)

So what is intelligence?

Lex Fridman (47:33.360)

So in the context of our current discussion,

Robert Breedlove (47:36.780)

I think intelligence is very closely linked

Lex Fridman (47:41.080)

to this notion of ideas.

Lex Fridman (47:45.340)

And it's the ability to generate ideas,

Lex Fridman (47:48.560)

to mold ideas, to compress seeming chaos

Robert Breedlove (47:54.600)

into some model, into some theory

Lex Fridman (47:58.680)

that efficiently compresses the chaos

Robert Breedlove (48:01.440)

in a way where you can then integrate it with other ideas

Lex Fridman (48:04.880)

and they can play and all those kinds of things.

Lex Fridman (48:07.080)

So in that sense, it's the turning chaos into order.

Lex Fridman (48:11.840)

It's the molding of ideas such that our human brains

Robert Breedlove (48:15.720)

can work with it.

Lex Fridman (48:17.840)

And just from my perspective,

Robert Breedlove (48:19.600)

I don't see any reason why that can not be algorithmatized,

Lex Fridman (48:22.880)

converted into computational systems.

Robert Breedlove (48:25.580)

I would agree.

Lex Fridman (48:27.220)

Which is scary.

Lex Fridman (48:29.240)

Scary or potentially really promising, right?

Lex Fridman (48:33.400)

It's kind of the case of all novelty.

Robert Breedlove (48:34.820)

It's terrifying as much as it is promising.

Lex Fridman (48:37.160)

That's why you're pursuing it so heavily.

Robert Breedlove (48:39.440)

I would maybe take it a step further

Lex Fridman (48:42.520)

and say that intelligence

Robert Breedlove (48:44.720)

in maybe its most simplistic form is error correction.

Lex Fridman (48:48.260)

So we, humans have wants.

Robert Breedlove (48:53.300)

Again, we're constantly expressing our value through action.

Lex Fridman (48:56.240)

There's no other way to express it by the way.

Robert Breedlove (48:58.000)

It's whatever you choose to do in any moment,

Lex Fridman (49:00.380)

you are expressing the values you hold

Robert Breedlove (49:02.280)

in your mind and your heart.

Lex Fridman (49:03.680)

So as we move from less valued A to more valued B,

Robert Breedlove (49:12.120)

entropy happens, uncertainty happens, we fall off course.

Lex Fridman (49:16.160)

And it is intelligence that enables us

Robert Breedlove (49:19.320)

to render information from that experience

Lex Fridman (49:21.680)

and error correct, right?

Lex Fridman (49:23.720)

So that we can move slightly,

Lex Fridman (49:25.920)

shift our trajectory slightly more towards B

Robert Breedlove (49:29.120)

that we're trying to move towards.

Lex Fridman (49:30.860)

So I think that there's something there

Robert Breedlove (49:35.600)

that I don't know that we can make synthetically.

Lex Fridman (49:41.840)

And that if we define intelligence as error correction,

Lex Fridman (49:45.800)

it's like error correction to what?

Lex Fridman (49:47.120)

It's error correction towards what we find is valuable.

Lex Fridman (49:50.600)

So we're trying to satisfy human wants.

Lex Fridman (49:52.560)

Might not just be our own, could be others as well.

Robert Breedlove (49:54.240)

If I'm an entrepreneur,

Lex Fridman (49:55.080)

I'm trying to solve the wants of others, not just myself.

Lex Fridman (49:57.560)

And I'm trying to error correct myself towards that goal,

Lex Fridman (4:00:01.040)

or the things of the most beauty,

Robert Breedlove (4:00:02.200)

whether that's your artistic expression,

Lex Fridman (4:00:03.920)

your children, your business, whatever it is.

Lex Fridman (4:00:07.960)

And Jordan Peterson goes deep into that

Lex Fridman (4:00:09.640)

where you have to listen to that sense of meaning

Robert Breedlove (4:00:12.640)

in your life.

Lex Fridman (4:00:13.640)

Or you might have some decision on paper

Robert Breedlove (4:00:15.280)

that's so great this way, but your heart says no,

Lex Fridman (4:00:18.280)

your heart says otherwise.

Robert Breedlove (4:00:22.040)

I've tried to listen to my heart throughout

Lex Fridman (4:00:24.160)

and I think that creates the best outcomes.

Lex Fridman (4:00:26.440)

But nevertheless, does it make you sad

Lex Fridman (4:00:30.240)

that you in particular, Robert,

Lex Fridman (4:00:34.400)

are gonna be dead pretty soon?

Lex Fridman (4:00:38.160)

As we talk about scarcity, one of the certain things

Robert Breedlove (4:00:42.280)

that ensure the scarcity of the human experience

Lex Fridman (4:00:45.920)

is the fact that you and your consciousness

Robert Breedlove (4:00:48.440)

are gonna be done, they have a deadline.

Lex Fridman (4:00:51.480)

Only time and Bitcoin are absolutely scarce.

Robert Breedlove (4:00:54.320)

I'm fortunate, I guess I got started

Lex Fridman (4:01:03.200)

on this philosophical journey a bit when I was younger,

Lex Fridman (4:01:05.480)

but I got into Musashi and Sun Tzu quite a bit,

Lex Fridman (4:01:11.280)

who wrote, Musashi wrote the Book of Five Rings,

Robert Breedlove (4:01:16.160)

Sun Tzu wrote The Art of War.

Lex Fridman (4:01:17.400)

And one of the things that, I mean,

Robert Breedlove (4:01:19.880)

these guys were just absolute beasts.

Lex Fridman (4:01:22.880)

They lived and died by the sword

Lex Fridman (4:01:24.440)

and they were just very great equanimity

Lex Fridman (4:01:28.880)

about all things in life.

Lex Fridman (4:01:30.240)

And I also found this kind of in the stoic philosophy

Lex Fridman (4:01:32.880)

where they just are very cool with everything.

Lex Fridman (4:01:37.440)

And one of the lines there is that the way of the warrior

Lex Fridman (4:01:40.560)

is the resolute acceptance of death.

Lex Fridman (4:01:43.560)

And so I've always tried to think about that.

Lex Fridman (4:01:45.120)

Like, of course I experienced fear,

Lex Fridman (4:01:46.920)

I experienced everything that you do on a meat suit, right?

Lex Fridman (4:01:51.800)

Like anxiety and all the things,

Lex Fridman (4:01:53.280)

but I always try to have that higher order view of myself

Lex Fridman (4:01:58.320)

and that it's just a certain experience occurring

Robert Breedlove (4:02:02.640)

at a certain level,

Lex Fridman (4:02:03.680)

but it shouldn't override your kind of highest order self.

Robert Breedlove (4:02:06.960)

That's just resolutely accepted death

Lex Fridman (4:02:09.720)

and that this is your one play in life.

Lex Fridman (4:02:13.520)

So hopefully that propels me towards proper action.

Lex Fridman (4:02:18.520)

I think scarcity cannot help, but lead to something good.

Robert Breedlove (4:02:25.040)

Just like with this conversation,

Lex Fridman (4:02:26.760)

sadly must come to an end.

Robert Breedlove (4:02:29.280)

The scarcity of it is what makes it beautiful.

Lex Fridman (4:02:31.400)

So Robert, this was one of my favorite conversations

Robert Breedlove (4:02:35.920)

philosophically and in every other level,

Lex Fridman (4:02:40.040)

just the ideas and the way you express them around Bitcoin,

Robert Breedlove (4:02:44.360)

around morality, around money.

Lex Fridman (4:02:47.100)

Has been really inspiring and really educational.

Lex Fridman (4:02:51.260)

And I'm glad you're out there fighting the good fight.

Lex Fridman (4:02:54.120)

And I'm glad you're wasting all of this time with me.

Robert Breedlove (4:02:57.020)

It was really fun.

Lex Fridman (4:02:58.340)

And thank you for coming down to Texas

Lex Fridman (4:03:01.680)

and having some good old brisket together.

Lex Fridman (4:03:05.020)

This was really fun, man.

Robert Breedlove (4:03:06.580)

This was awesome.

Lex Fridman (4:03:07.920)

Thanks for having me, man.

Robert Breedlove (4:03:09.980)

Thanks for listening to this conversation

Lex Fridman (4:03:11.660)

with Robert Breedlove.

Lex Fridman (4:03:13.060)

And thank you to Fundrise, Element, Mugpack, and BetterHelp.

Lex Fridman (4:03:18.540)

Check them out in the description to support this podcast.

Lex Fridman (4:03:21.980)

And now let me leave you with some words

Lex Fridman (4:03:24.060)

from Nassim Nicholas Taleb.

Robert Breedlove (4:03:26.420)

"'Antifragility is beyond resilience or robustness.

Lex Fridman (4:03:29.940)

"'The resilient resists shocks and stay the same.

Robert Breedlove (4:03:33.620)

"'The antifragile gets better.'"

Lex Fridman (4:03:36.420)

Thank you for listening and hope to see you next time.

Robert Breedlove (50:01.400)

using intelligence and processing environmental feedback

Lex Fridman (50:04.680)

through intelligence to error correct.

Lex Fridman (50:06.560)

So I don't know how,

Lex Fridman (50:08.040)

if you eliminate the human element completely,

Lex Fridman (50:12.440)

who's doing the wanting, right?

Lex Fridman (50:13.940)

Where does value come from?

Robert Breedlove (50:15.320)

I know the machine learning people who are listening

Lex Fridman (50:18.240)

are saying that's exactly what machine learning is,

Robert Breedlove (50:20.280)

which is error correction

Lex Fridman (50:21.480)

because you have a loss function, objective function

Robert Breedlove (50:24.060)

that measures how wrong your thing is

Lex Fridman (50:28.320)

and you wanna make it less wrong next time.

Robert Breedlove (50:30.240)

That's the whole process of machine learning.

Lex Fridman (50:32.000)

But you're saying what humans are able to do

Robert Breedlove (50:35.560)

is in a world where there's no maybe objective values,

Lex Fridman (50:42.280)

absolute values, you're generating that very loss function,

Robert Breedlove (50:46.480)

that objective function that measures the error

Lex Fridman (50:51.480)

comes from the human mind.

Robert Breedlove (50:55.120)

Some aliens might disagree with you

Lex Fridman (50:57.240)

because they might have a different objective function.

Robert Breedlove (51:00.040)

Obviously, the purpose comes from consciousness, I think.

Lex Fridman (51:02.800)

And without purpose, there's not error correction.

Robert Breedlove (51:05.560)

Yeah, I mean, this is again, a hypothesis.

Lex Fridman (51:08.000)

Like where does purpose come from?

Robert Breedlove (51:09.560)

It seems to come from consciousness, you're right.

Lex Fridman (51:13.160)

That's where suffering comes from

Lex Fridman (51:15.160)

and you want to lessen suffering.

Lex Fridman (51:18.160)

That's where pleasure comes from.

Robert Breedlove (51:20.120)

It seems like it's consciousness.

Lex Fridman (51:21.920)

Maybe there's something to this biological meat bag.

Lex Fridman (51:25.160)

So to take it one layer deeper on this

Lex Fridman (51:27.320)

and the reason I like this book so much,

Robert Breedlove (51:29.120)

again, The Case Against Reality.

Lex Fridman (51:31.660)

So he's making the case that space and time

Robert Breedlove (51:33.600)

are not fundamental.

Lex Fridman (51:35.200)

Yes.

Robert Breedlove (51:36.040)

Which I started my intellectual explorations in physics,

Lex Fridman (51:39.260)

actually astrophysics.

Lex Fridman (51:40.180)

So for the longest time, even the way I describe money

Lex Fridman (51:42.660)

as I talk about space and time, so that blew my mind.

Lex Fridman (51:46.560)

But this dovetailed nicely with another book called Lila.

Lex Fridman (51:51.440)

The author is Robert Persig.

Lex Fridman (51:53.400)

So he wrote Zen and the Art of Motorcycle Maintenance,

Lex Fridman (51:55.560)

which is a very popular book.

Robert Breedlove (51:57.280)

20 years later, he wrote Lila, which no one's heard of,

Lex Fridman (52:00.120)

which is crazy.

Lex Fridman (52:01.400)

And he basically says he was wrong about his first book.

Lex Fridman (52:03.920)

And he lays out this entire other metaphysics of quality,

Robert Breedlove (52:08.400)

he calls it.

Lex Fridman (52:09.240)

So it's the metaphysics, I think it's metaphysics of quality.

Lex Fridman (52:12.480)

But his supposition is that it's not physical reality

Lex Fridman (52:18.080)

that's fundamental.

Robert Breedlove (52:19.040)

It's not informational information that's fundamental,

Lex Fridman (52:22.240)

it's value.

Lex Fridman (52:24.240)

So he actually, and it's a beautiful book,

Lex Fridman (52:26.960)

I highly recommend it.

Robert Breedlove (52:29.200)

He essentially is refuting causality itself.

Lex Fridman (52:33.180)

We think A causes B.

Robert Breedlove (52:34.960)

This book makes the case that B values precondition A,

Lex Fridman (52:42.580)

so that we are actually creating our future

Robert Breedlove (52:45.980)

through our value systems.

Lex Fridman (52:48.420)

And this goes back to something,

Robert Breedlove (52:50.900)

I think Solzhenitsyn said this,

Lex Fridman (52:52.260)

that the line between good and evil

Robert Breedlove (52:54.300)

runs down the heart of every man.

Lex Fridman (52:56.220)

So it's as if our moral decisions

Robert Breedlove (52:58.940)

are actually what's creating the outcomes

Lex Fridman (53:01.500)

in reality over time.

Lex Fridman (53:03.260)

And then that gets into all the wisdom traditions

Lex Fridman (53:05.500)

related to religion,

Robert Breedlove (53:06.620)

where it's always talking about loving thy neighbor

Lex Fridman (53:10.180)

and loving God and all of these other things

Robert Breedlove (53:12.380)

that are good morally to create the best outcomes.

Lex Fridman (53:15.260)

So values are fundamental.

Robert Breedlove (53:17.840)

Value, yes.

Lex Fridman (53:19.260)

Value is fundamental.

Robert Breedlove (53:22.300)

Oh boy, yeah, that's interesting.

Lex Fridman (53:26.940)

It does feel like physics is not capturing something.

Robert Breedlove (53:30.140)

You know, there's some people, panpsychists argue

Lex Fridman (53:35.500)

that consciousness might be one of the fundamental

Robert Breedlove (53:38.300)

properties of nature,

Lex Fridman (53:39.620)

like from which emerges everything we see.

Lex Fridman (53:42.820)

So that could be just other words

Lex Fridman (53:46.420)

for this same notion of value.

Lex Fridman (53:49.420)

And then the basic laws of physics

Lex Fridman (53:51.700)

are not capturing that currently.

Lex Fridman (53:54.020)

So maybe humans, in order to understand

Lex Fridman (53:56.500)

from where humans came from,

Robert Breedlove (53:57.820)

we have to understand these other properties of nature,

Lex Fridman (54:00.580)

which are yet to be discovered at the physics level.

Lex Fridman (54:03.500)

And it's, we contend with that underlying nature,

Lex Fridman (54:08.140)

whatever it is, with the logos, right?

Lex Fridman (54:10.760)

So we're looking at uncategorized nature

Lex Fridman (54:16.220)

and then we're assigning a word to it.

Lex Fridman (54:18.540)

So we're slicing up chaos into little boxes of order.

Lex Fridman (54:23.260)

And then we're establishing this social consensus

Robert Breedlove (54:25.740)

as to those labels, which we'd call words.

Lex Fridman (54:28.860)

And we're using that to communicate.

Lex Fridman (54:30.780)

And when we communicate,

Lex Fridman (54:33.820)

we can start to build these other things.

Robert Breedlove (54:35.260)

This is like the Yuval Harari imagined orders.

Lex Fridman (54:37.980)

So we can create these useful fictions, right?

Robert Breedlove (54:41.060)

Whether it's the nation state or human rights or money.

Lex Fridman (54:44.060)

And that allows us to cooperate flexibly in large numbers

Lex Fridman (54:48.580)

so that we can better contend with reality.

Lex Fridman (54:50.500)

We can produce more complicated things.

Robert Breedlove (54:53.720)

We can enlarge that bubble of civilization against entropy.

Lex Fridman (54:58.380)

And that's what capitalism is all about.

Robert Breedlove (55:01.100)

It's about further specializing knowledge,

Lex Fridman (55:04.520)

further enriching mankind's treasury of knowledge

Lex Fridman (55:08.700)

and doing it.

Lex Fridman (55:09.580)

But to do that, the communication media that we're using,

Robert Breedlove (55:14.240)

the words have to have stable meaning.

Lex Fridman (55:16.780)

The money needs to have value that's dependable, right?

Robert Breedlove (55:21.540)

It needs to be something that's, it's not dictated

Lex Fridman (55:25.600)

by any one group.

Robert Breedlove (55:26.920)

It's reached by consensus of the entire group.

Lex Fridman (55:30.620)

That's how, so you could think it's like optimizing

Robert Breedlove (55:35.580)

for error correction again,

Lex Fridman (55:36.760)

where a free market would be harnessing the intelligence

Robert Breedlove (55:39.980)

of all market actors and a central planning

Lex Fridman (55:43.860)

or essentially planned market would be harnessing

Robert Breedlove (55:46.020)

just the intelligence of a small group of bureaucrats.

Lex Fridman (55:49.860)

And it's not obvious how to achieve this kind

Robert Breedlove (55:51.620)

of consensus mechanism.

Lex Fridman (55:53.460)

I mean, there's obviously, we'll talk about sort of Bitcoin

Robert Breedlove (55:56.780)

as an idea.

Lex Fridman (55:57.880)

Ultimately, the idea of Bitcoin is connecting it to physics.

Lex Fridman (56:02.860)

So like, you can trust that physical matter won't change.

Lex Fridman (56:09.060)

But, you know, there could be other ideas that we get.

Robert Breedlove (56:12.940)

Maybe physics could be changed.

Lex Fridman (56:14.660)

If Eric Weinstein has anything to say about it.

Robert Breedlove (56:17.420)

Like it's, you know, we right now believe

Lex Fridman (56:19.980)

that physics can't be changed.

Robert Breedlove (56:21.580)

The physical matter of the world, but maybe it can

Lex Fridman (56:24.460)

in a way that we're totally not understanding.

Robert Breedlove (56:26.480)

You mentioned sort of reality

Lex Fridman (56:28.460)

from Donald Hoffman's perspective.

Robert Breedlove (56:32.460)

Like if we don't have even close to direct access

Lex Fridman (56:35.440)

to the fabric of reality, maybe we're living in a world

Robert Breedlove (56:39.600)

that's very like many dimensions,

Lex Fridman (56:42.420)

that the notions of space and time is just like a silly,

Robert Breedlove (56:45.180)

useful construct that's not at all connected.

Lex Fridman (56:48.480)

You're starting to look at like Stephen Wolframs.

Robert Breedlove (56:51.020)

I don't know if you're familiar with this view

Lex Fridman (56:53.500)

of the world that it's like hypergraphs underneath it all.

Robert Breedlove (56:57.140)

Like these mathematical structures

Lex Fridman (56:58.660)

from which everything emerges.

Robert Breedlove (57:00.460)

Like they're like many, many, many orders of magnitude,

Lex Fridman (57:07.380)

smaller than what we think of.

Robert Breedlove (57:10.140)

They're even smaller than like strings and string theory.

Lex Fridman (57:13.240)

So like those are the basic mathematical objects

Robert Breedlove (57:15.300)

from which it emerges.

Lex Fridman (57:16.540)

I don't, you know,

Robert Breedlove (57:17.620)

I think that's an interesting philosophical framework.

Lex Fridman (57:20.540)

It's also, people should check out a cool way to play

Robert Breedlove (57:25.340)

with beautiful hypergraph mathematical structures.

Lex Fridman (57:27.700)

So he has, I don't know if you know who Stephen Wolfram is,

Lex Fridman (57:30.040)

but he created Wolfram Alpha and all these tools

Lex Fridman (57:34.240)

that you can actually visualize and play with.

Lex Fridman (57:36.360)

So you can play with physics in a visual way,

Lex Fridman (57:39.280)

which, or at least discrete mathematics,

Robert Breedlove (57:43.540)

which I think is incredible.

Lex Fridman (57:45.060)

He doesn't get enough love.

Robert Breedlove (57:46.820)

One of the reasons he, I think doesn't get enough love

Lex Fridman (57:50.420)

is because of this little quirk of human nature,

Robert Breedlove (57:53.360)

which is the ego.

Lex Fridman (57:55.700)

And he sometimes frustrates a few folks

Robert Breedlove (57:59.860)

because he's very, let's say proud of his work.

Lex Fridman (58:03.980)

I guess.

Lex Fridman (58:04.820)

But it's interesting to think about a world

Lex Fridman (58:10.380)

where we don't have direct access to reality,

Robert Breedlove (58:13.580)

as Hoffman argues.

Lex Fridman (58:14.980)

And maybe, I don't know if you can comment.

Robert Breedlove (58:17.300)

I don't know if you're familiar with Ayn Rand's work

Lex Fridman (58:19.380)

and her whole philosophy of objectivism

Robert Breedlove (58:21.980)

or her whole contention is that, you know,

Lex Fridman (58:25.700)

we do have access.

Robert Breedlove (58:28.360)

I don't want to misstate it,

Lex Fridman (58:29.420)

but at least she would claim

Robert Breedlove (58:33.220)

that it's not useful,

Lex Fridman (58:39.180)

or I think she would probably say it's not correct

Robert Breedlove (58:41.600)

to argue that we don't have access to reality.

Lex Fridman (58:44.220)

We have, hence, objectivism.

Robert Breedlove (58:46.060)

We have direct access to reality.

Lex Fridman (58:49.140)

That's the only thing we can reason about.

Lex Fridman (58:52.380)

And the only way to live life morally

Lex Fridman (58:55.120)

is to reason through everything,

Robert Breedlove (58:57.740)

starting with the axioms of reality,

Lex Fridman (58:59.620)

which we do have direct access to.

Lex Fridman (59:02.060)

Do you have thoughts about her work?

Lex Fridman (59:04.580)

I am slightly ashamed to say I have not read Ayn Rand yet.

Lex Fridman (59:08.900)

So she is high on my list

Lex Fridman (59:10.500)

and she's been recommended a number of times.

Lex Fridman (59:14.700)

So I don't know a lot specifically

Lex Fridman (59:16.260)

about her philosophy or objectivism,

Lex Fridman (59:18.300)

but to me, it resonates closely

Lex Fridman (59:21.620)

with what the American pragmatist commented on truth.

Lex Fridman (59:25.780)

And they distinguished what you could say

Lex Fridman (59:28.140)

is absolute truth, which is at the bottom of reality,

Robert Breedlove (59:31.300)

whether it's Mr. Wolfram's mathematical formulas or value,

Lex Fridman (59:34.340)

whatever it may be, it's something ineffable,

Robert Breedlove (59:37.020)

something beyond the reach of epistemology, perhaps even.

Lex Fridman (59:42.340)

And maybe that's why religion just sort of points to it.

Robert Breedlove (59:45.580)

It's trying to use, I think Joseph Campbell said something

Lex Fridman (59:50.060)

like religion is using stories

Robert Breedlove (59:55.700)

to point towards the same transcendental mystery

Lex Fridman (59:58.460)

we all experience but cannot articulate.