Jimmy Song and Robert Breedlove join me to talk about a new book they co-authored (with other authors) on Bitcoin and how it fixes fiat money. This new book is inspired by The Ethics of Money Production and Honest Money, which blends an austrian analysis of fiat money and fractional reserve banking, with a christian perspective. 

Links:

• Book: Thank God For Bitcoin
• Jimmy Song: @jimmysong 
• Robert Breedlove: @breedlove22

Sponsors:

• Swan Bitcoin
• Knox Custody
• Hodl Hodl
• Unchained Capital (code LIVERA)
• CypherSafe (code LIVERA)

Stephan Livera links:

• Show notes and website
• Follow me on twitter @stephanlivera
• Subscribe to the podcast
• Patreon @stephanlivera

Podcast Transcript:

Stephan Livera:

Jimmy and Robert, welcome back to the show.

Jimmy Song:

Thanks for having us.

Stephan Livera:

So guys I’ve seen I’ve had a chance to read your new book and I really enjoyed it. So perhaps you guys just want to start off with a little bit on how you got the idea to write this book.

Jimmy Song:

Actually, it started as something like a little bit of a Bible study slash book club, and it started between me and George Mekhail. And basically we got together, we started studying some Bible passages, trying to relate it back to Bitcoin. And eventually we got to the point where we had gone through a bunch of Bible passages and we felt like there was something useful there, but we needed we wanted it to be a little more systematic and opened it up to some more people. So at that point we invited a bunch more people and we started studying more books. The two books in particular that we looked at were Jörg Guido Hülsmann the Ethics of Money Production and Gary North’s Honest Money. And when we went through both of those books, you know, Robert was in that group obviously. And all the co-authors were, and at the end we were kind of dissatisfied with both books because they were just so depressing in how they ended, which was essentially, we need to get enough of a political movement in order to go back to the gold standard, which everyone knows is not going to happen. So we decided to write our own book that focuses more on Bitcoin while still sort of like educating in terms of the moral aspect of money, which both books we thought did pretty well.

Stephan Livera:

Robert, how about from your perspective?

Robert Breedlove:

Yeah, I was fortunate to get connected to the Bible and Bitcoin study group. I think Stephen Cole introduced me actually. So thanks Steven. And we went through, I’d already read both books, but it was really, it was a lot of fun to go through it with a group and just hear everyone’s perspective. And I think we just developed kind of an energy or something. We looked forward to it every week. And then, you know, the Jimmy’s point after getting through both books are excellent books, by the way, they just have terrible conclusions. They’re just like, here’s everything that’s wrong with money, pragmatically and morally, but the solution is let’s figure out how to make gold work, even though gold’s failed repeatedly. So we’re very dissatisfied with the conclusion. And I think Jimmy just threw out the idea, like, you know, we could try to write our own book if you guys want to give it a shot.

Robert Breedlove:

And we just dove in Jimmy brought some experience from Little Bitcoin book, how they had collaborated on that. So he brought some structure and framework as to how we actually start the process. And it’s been an awesome experience. A bit of controlled chaos, you know, we have eight total co-authors. So the editing and writing, there’s just a lot of chefs in the kitchen, I guess you would say. But I think the end product speaks for itself. You know, I would like to think the book is very accessible. We tried to write it with kind of a CS Lewis type voice, so it’s very simplistic, but potent in its message. And and we cover kind of soup to nuts creation, corruption and redemption of money. And I hope that our conclusion is much better than the other two books.

Stephan Livera:

Of course. And so can you tell us a little bit about who the target audience is for this book? Who’s the typical person who would be a good person to recommend this book?

Jimmy Song:

Yeah, so we actually went through this as part of the book writing exercise, like go through who our target audiences and all of us wrote a detailed profile of who we were targeting for. I can’t speak to Robert’s target, but mine was sort of like a suburban mom that goes to church that maybe leads a Bible study that doesn’t know very much about Bitcoin that’s who I was writing for the entire time. And I know several women that are like that. So it was to get into sort of that mindset, but generally it’s for Christians, it’s for people who’ve really only heard bad things about Bitcoin.

Jimmy Song:

So from a moral perspective, they have sort of a negative view towards it.Thinking that it’s only good for drugs or money laundering or something like that. And instead sort of present a new aspect of it all of the things about sound money and all of the different incentives that go into it, at least that was mine. I’m sure Robert has a different like, or not a different perspective, but one that similar, but yeah, it’d be interesting to hear from him too.

Robert Breedlove:

Yeah. That was a great exercise actually to get us into the mind of our target audience, such that we wrote the book in a way that really catered to them. And that was again, Jimmy suggested that, which I thought was excellent. My individual was a recent college graduate. He had been raised Christian, but his intellectual wandering sort of took him off the path, I guess you could say. And so he was sort of partly curious about spirituality, religion, Christianity, and also partly curious about Bitcoin. He heard about it, but didn’t know a lot about it. And I think the book sort of caters to both, right, you could be a, someone just generally curious about Bitcoin and money, and you would learn a lot from this book. I think it’s, again, very accessible very easy to digest.

Robert Breedlove:

And in the process, you would also see how it ties back to some Christian and spiritual principles, or you could be a devout Christian, I think, and really not know much about Bitcoin and probably anchor your understanding of Bitcoin and your deeper understanding of Christianity. So I think it came off well, you know, it’s not, so we’re so mired in the jargon of either Bitcoiner or Christianity that it is not accessible by kind of a general audience. And I think I would like to just see this getting into you know, study groups, you know, we’re talking about possibly doing a Bible study workbook to go along with us for maybe Bible study groups or possibly, and just general, like, as we started general kind of a book club? I think this book could be a great first read for people that don’t understand Bitcoin.

Stephan Livera:

I think so as well from my reading of the book as well, because it has a lot of really nice, simple explanations of many of the things that all three of us have been talking about for years, really but put into really a nice way that a new person to Bitcoin can try to understand these things. And obviously it makes the most sense to recommend this book to a Christian. But I think non-Christians can also appreciate the value of this book as well. And I think you touch on some really interesting themes in the book as well, that for example, money can be used to exploit people and yet, that’s the problem with the way money evolved as we use it today. And obviously now with Bitcoin, it’s going to change some of that. And so you talk about some of the consequences one interesting theme I’d love to touch on that you mentioned in the book is this idea that without sowing, there can be no reaping, what are you getting at with that idea?

Jimmy Song:

Yeah. So for me, that whole concept is talking about how the natural process is that you put in some amount of work and you get something out, right? Like of course the work could be kind of feudal and not produce anything, but the sort of the market process where if you’re sowing in the right place and cultivating it correctly, then there’s like sort of a just reward for it. But with the Fiat money system with you the dollar and many others, what you end up getting is something that’s the opposite where you have this ability to essentially inaudible, not really , so anything but still reap a lot of the benefits. And that for us has a real spiritual aspect to it. I mean, we point that out in chapter one that we have this ability to create because we’re made in God’s image.

Jimmy Song:

And as a result of that we can kind of create order out of chaos and we can make something that wasn’t there before. And that’s part of what’s satisfying about being human, right? Like this ability to create order out of chaos to produce something. Whereas, so much of the modern world is just sort of rent seeking and not really creating anything, not really sowing, but just sort of reaping benefits from everybody else. And that to me was like a pivotal part of you know, the function of money is that it has this incentive, the Fiat monetary system has this incentive where the people that are sowing are not reaping all of the rewards that they’re due instead, it’s all of these bureaucrats and government officials and many other people that sort of skim off the top, just a little bit from everybody, but cumulatively, they end up much richer than they really, in proportion to what actually valued that they added. So it ends up skewing the system quite a bit. And that’s what we were trying to, at least on my end. That’s how I was thinking of it.

Stephan Livera:

And for you Robert?

Robert Breedlove:

Actually, I like the sowing and reaping analogy a lot because I think that is the kernel of economics, right? What makes humans unique is that we can delay gratification and save for the future, right? Just the classic example Saifedean in his book of catching less fish today to build a fishing pole, to catch more and better fish tomorrow, this is a unique ability that humans have that allow us to cooperate and trade with one another at scale, such that we can become more than the sum of our parts. And that’s, you know, if by sowing basically planning for the future operating on a longer time horizon or with a lower time preference, this allows us to become collectively more productive, right. Which is the whole game of macroeconomics. And another way to think about that is the more productive we become.

Robert Breedlove:

We’re actually becoming more transcendent of time, right? We can accomplish greater results with the same or less efforts over time. And the net output of that, of this honest sowing and reaping process, when everyone’s engaging in this together, as we generate truthful prices in the marketplace the prices in theory would be declining over time because we’re becoming more productive, useful innovations are being generated by the market. And I would argue it also instills virtue, right? Because we learn to behave honestly and forthrightly with one another such that we can best satisfy the wants of each other, right. That’s what the market rewards. And I’ve always thought that was a very, like, even in a secular sense by when you become more productive. And you’re more transcendent of time. This to me points towards work as a noble pursuit, because we’re actually more closely approaching the timelessness of God, right? Whatever God means to you, God is eternal, right? So transcendent of time and through work that is the only avenue through which mankind or human beings can more closely approach this eternity of God.

Stephan Livera:

Excellent. And in the book, you also really spell out almost like a, kind of an easier version of the Ethics of Money Production, where you kind of telling a little bit of that story of what happened with things like fractional reserve banking and the suspension of convertability. So can you tell us a little bit about how you went about explaining that process in the book?

Jimmy Song:

The suspending convertability and like just all of the sort of history of money is something that’s actually really interesting. Right. And like relating it back to biblical references to money was actually really fun. And as a Christian, I have never really made those connections until I studied it a lot more using books like Ethics of Money Production and honest money. Like for example fact that most of the old Testament, there weren’t any coins. So they always had to measure the weight of whatever, gold piece or silver piece that you brought. And that was a critical part of every transaction was the actual weighing. And then the negotiation, how much am I going to get for this and so on. And of course that opened a lot of room for cheating each other and so on.

Jimmy Song:

And like later as the history continued, like we tried to explain why it got to the point that it has and why the incentives are so skewed. I kind of wish we had stumbled upon this this way of framing it while we were writing the book. But I came upon one that I thought was really fantastic, which is that money that adds more moral hazards is a worst money than one that doesn’t with something like Boolean it has moral implications, right? Because there are moral hazards for the person for the merchant, because they’re both doing the wing of the Boolean and also, giving you the good. So there’s a moral hazard there because they can take some of your stuff for, without providing commensurate value on their end. And the thing is with each quote unquote, innovation that moral hazard got bigger and bigger and confined to fewer and fewer people. And that’s essentially, I wish we had used those words, but that’s essentially what we’re describing in the history chapter about why governments went around this and suspending comfortability was another step towards more creating a bigger moral hazard for themselves essentially, so that they can steal from everybody else.

Stephan Livera:

Yeah. And I found it really an interesting explanation as well, of how you spell out how the banks are essentially getting something for nothing. Robert, do you want to touch on your thoughts there?

Robert Breedlove:

Yeah. From a very first principle standpoint, again, if a tool is just something that is intended to increase our productivity, we can look at money as a tool for calculating negotiating and executing trades more quickly. And another way to say that is that money just lets us lower transaction costs, right? So we can trade with more liquidity and with less friction essentially. And gold was the best money for doing that over time, right? It was the commodity will say that the monetary metal most resistant to supply manipulation over time. So that’s the most resistant supply inflation over time giving it the greatest store value function. But it was limited in terms of transacting over space because Gold is heavy and difficult to move. So it was basically, it seems to me like it was a further attempt to increase the usefulness of gold as money.

Robert Breedlove:

That’s why we abstracted it into coinage and later paper notes and later electronic entries that we’re actually trying to further decrease the transaction costs associated with Gold to make it more useful out of the money for calculating negotiating executing trades. But of course, this introduced that attack vector, which is that the intermediary or the custodian or the issuer of those bank notes or coins that we had to trust all of a sudden gained absolute power effectively. And they gained the power to do things like suspending convertability, right? If they were issuing gold backed paper, they could just sever the redeemability of that paper when times were bad or they couldn’t afford it. So this just corrupts the entire system, because what it does is it introduces this gap between trade and settlement. So we have people trading dollars in the market, but often right, say high frequency trades, but low frequency settlement. So they’re not actually redeeming it for gold as often. And between those two events between trade and settlement, all the games and manipulations and corruption of traditional finance occur. So I would just put suspension of convertible in that bucket. And that’s where there’s another way to think of Bitcoin is very important is that it’s collapsed trade and settlement into a single event. Right. We can settle with finality nearly, instantly pretty much anywhere in the world, which points towards Bitcoin’s incorruptible character, if you will, as money.

Stephan Livera:

Yeah. And also in the book, you have a nice explanation of Cantillon effects. And I think it’s really a tough point to get for the typical person. Who’s not kind of deeply into this world. Like we are. So can you, how do you go about teaching Kantian effects in the book?

Jimmy Song:

Robert you want to take this one?

Robert Breedlove:

Yeah, sure. I think we touch on it relatively early on. I want to say that we describe it as a distributive effect of money, but essentially when you have a monopolist that’s gained control over the money supply, again it’s introduced this political attack vector right. Where they can do things like suspend convertability, or they can also arbitrarily increase it’s supply. And when they do that, they diluting the value of other holders and politically selecting winners and losers, if you will, right. The winners being the first recipients of the newly printed money, the losers being the last recipients who are taxed via inflation. And I think we talk a little bit about Richard Cantillon. If I recall, maybe we just referenced him in a footnote, I’m not 100% sure on that. But I think we, we definitely make it a point for the reader that this is something they really need to look into and understand, because that is the mechanism right. Through which we’re all being, I would say invisibly or less visibly robbed, right. Just through, through price increases, these artificial price increases over time. So yeah, that’s what I would say about that.

Stephan Livera:

Yeah. And also I find it interesting as well, that if we think from a cost of capital perspective, the cheap capital costs are not available to us pleb masses right. They are only available to the politically connected Cantillon insiders.

Jimmy Song:

Right. And like the way Saifedean would put this is that there’s no opportunity cost of capital for sufficiently rich people. If you have a high enough credit score or have enough credit with the market or something like that you don’t have to compete for capital, they just print it whenever you need it. Which is essentially like a way for you to get even more money. And not really, the people lending to you, aren’t risking very much because they’ll get bailed out or you know, I mean, this is why you’re able to get loans at like half a percent or 1% or something like that as a large company that cost of capital continues going down in any sort of Fiat money system because, you don’t have to compete for it at all.

Jimmy Song:

If there were 30 companies and there was only a fixed amount of capital, then like the interest rate would vary not based on the central bank says, it would be based on, whoever is lending versus whoever is borrowing. Like they would set the market price and it would probably go up and down depending on the conditions that of the economy at the time and so on. But Cantillon effects like one of the things that it does is it just continues lowering interest rates. It’s essentially until you kind of explode into some sort of hyperinflation and that’s one of the dangers that we point out in the book is that it’s almost always sort of gradual for a long time. And then all of a sudden everything collapses. And that’s not a reality that a lot of people are really prepared for.

Robert Breedlove:

Yeah. I would add to that money systems themselves are inherently predatory, right? Because those that already have the capital to lend are doing it at interest to those that need to borrow. And when you can constantly bail out, right, the top that’s doing the lending is basically setting the rules in their own favor. So they’re profiting from this lending activities, but then if there are ever losses due to a fluctuation, say in the business cycle, they’re getting bailed out by those the same taxpayers are those lower down the economic hierarchy. So this, it has the effect of widening the wealth gap and we argued pretty strongly in the book. It also centralizes control over capital over time, which we’re seeing in the modern economy. And it’s kind of like proof of stake in a way, right?

Robert Breedlove:

Just the bigger bag accretes more of the value, right. And it’s an inherently an unstable structure. So it also, it’s just distorting the incentives towards get too big to fail or die trying, which, you know, I think we see that rampantly in the financial system today. And I would argue, that’s why usury is looked down upon in the Bible, right? It’s not on a hard money standard when you choose to loan to someone, there should be almost this inbuilt interest rate, right? The money hard money should be kind of appreciating roughly in tandem with general economic productivity. But when you start putting usury on top of that and even worse centrally managing and controlling the money supply and interest rate, it just widens the wealth gap even faster and leads to social collapse.

Stephan Livera:

And I think one thing outsiders or people outside of the Bitcoin world, sometimes they criticize Bitcoin advocates like us and they say, Oh, you guys are so focused on central bank money printing, but actually a lot of the money is made by the private commercial banks. And I think even in this book, you actually do articulate that also. So could you just spell out a little bit of a view there on how it is that actually some of the money creation happens in the private bank?

Jimmy Song:

Yeah. So the way it works is that every loan pretty much in the economy with a few exceptions comes from money that doesn’t exist. So every time if you’re getting a loan for a mortgage, and this is an example from the book, if you had to do that in the real market, there’s not going to be anyone that’s going to lend you $400,000 at a 3% interest rate over a term of 30 years. They’re not going to want to have a term that long. They’re also not going to want to lend you out at an interest rate that low. And they’re also going to do a lot you know, they’re not gonna want to take back sort of credit risk especially over that long of a period of time, yet that happens almost every day. And that’s because all of that money is newly printed and of course Fannie and Freddie like insure those mortgages against collapse and things like that.

Jimmy Song:

So what you end up getting are all of these loans that are like, sort of coming in like out of nowhere and this happens at every level from your credit card or mortgage to a bank floating bonds, or, getting a commercial bank loan or the federal reserve creating buying treasuries up from the government at every level. So one of the things we point out in the book is that we’re all kind of complicit in this it’s not just a central bank that is printing oodles of money, and we have no culpability in it. Every time we borrow money you know, like we benefit because we’re getting access to money right away, the bank benefits because they’re earning interest, but there’s a whole host of on unseen effects second order effects, if you will where, you know, everyone is being diluted just by a little bit.

Jimmy Song:

And it’s kind of a moral hazard because the bank is motivated to do it, you’re motivated to do it. So everyone sort of gets up to their eyeballs in debt, but you’re diluting the all of civilization in order to do it. You’re essentially debasing human savings which is a way of debasing human time, which we argue is a way of sort of enslaving all of us in a sort of modern take on usury. But that’s what’s happening is that because of this, debt based system, you know we end up having to we’re all sort of like culpable in all of this new money printing. We’re just sort of like stealing from each other back and forth though. Clearly the richer you are, the more you’re able to steal and the poorer you are, the less you’re able to steal.

Stephan Livera:

Yeah. And also another really interesting theme from the book is around the impact of Fiat money on the church itself. So perhaps Robert, do you want to fill out a little bit of what are you talking about there?

Robert Breedlove:

Yeah, I’ll try to speak to the last question. First. The other thing about the argument that we’re too focused on central banks versus regional or state banks, it fails to understand that all of the rules governing non-central banks are still centrally planned, right? We’re talking about reserve ratios, lending requirements, the federal funds rate at which they borrow the original monetary base on which they fractionated on top of capital controls, et cetera, et cetera. So it all, everything stems from the bureaucratic decision-making at the central bank level, even though some of the money creation is done at second, third and fourth order to your banks. So I don’t think that’s an argument that necessarily holds like the rules of the game are still centrally and arbitrarily established and twisted to the benefit of central bank shareholders at the expense of all other market actors and it’s getting worse, right?

Robert Breedlove:

Because like today we have the fed, which use its mandate used to require it to go through some these channels such as like loaning to buying treasury debt, to inject money into the economy. And then the treasury would sort of distribute the cash. But today the fed has SPV’s buying corporate bonds directly, for instance, right? So they’re now directly, you know, non elected bureaucrats are directly selecting winners and losers in the quote unquote free market, which is less and less of a free market with every action like this. And to Jimmy’s earlier point. And we pick this up in Gary North’s book, Honest Money that we can’t just point at central banks and say, Oh, these guys are evil. It’s actually this, this entire, it’s a systemic issue where we’ve built a system that preys on our own proclivity. Everyone wants something for nothing, right?

Robert Breedlove:

So people think they’re benefiting from inflation when they see their house prices going up, equity portfolios going up, et cetera, et cetera. But this is in truth the dollar depreciating against these portfolios. And then central banks and their shareholders get this perpetual mechanism of wealth compensation, right. They just, any time they want to juice their own revenue they can basically just press print. So it’s we’ve moved away from sowing and reaping completely. Right. We’re trying to just reap and never sow, so there’s this we would say a sinful nature of man trying to just reap not sow. That’s got us into this mess and I think, you know, Bitcoin and with its rootedness and proof of work, sort of takes us the complete opposite direction and back toward something that’s more biblically sound.

Robert Breedlove:

And I would say on how money has affected the church this was actually not one of the chapters I specialize in, but I would say in general, all man-made institutions to this point have been subject to corruption, right? They may start with good intentions. Like some could argue that even the central bank was started with good intentions. I don’t agree with that argument, but some could say, Oh wait, we need stable prices and low unemployment such that we can have whatever, stability in our growing economy. But over time, the agendas of those that get into the seat of power, gradually reshaped its rules and the flows of capital through the institution in a way that benefits their own personal agendas at the expense of other stakeholders. And I think the church has no different, it’s just been twisted over time by man. And to me again, this points towards the importance of Bitcoin as possibly the first social institution we’ve ever had that refuses to suffer corruption, right? There’s nothing anyone can do to change 21 million as long as everyone’s following their own. Self-Interests. So, as we argue in the book that Bitcoin in a way is a system of converting individual, the pursuit of individual self-interest into the generation of the collective self-interest.

Stephan Livera:

Yeah. Excellent. Jimmy, anything to add there?

Jimmy Song:

Yeah. I mean, as far as how all this loose money policy affects the church, we go into a lot of how it’s affected individuals and the same thing is true for the church. There’s a tendency to be a lot more materialistic, a lot more consumption-based are bringing consumption forward is is essentially what that does is instead of saving up for something you end up spending it all and then being enslaved for the next X years in order to pay that off. I think it’s fairly clear from my reading of the Bible, at least that you know, like sort of working to save and then you know, getting something is a lot healthier spiritually than getting it all at once and then paying it off over a long period of time.

Jimmy Song:

I mean, you can ask any parent what they want to do with their kids and almost all of them will tell you, like it’s healthier for them. It’s better for them. If they have to work for what they want to get, instead of getting it all at once and then sort of feeling embittered that they have to, you know work off something that they already consumed. So churches, I think essentially have gone down the same rabbit hole. One of the things that we point out is that so many of them are in a lot of debt largely due to these large buildings that they make. I know like many such churches where that spend, you know, many millions of dollars building a wonderful campus, but then they have to pay it off, pay it off over the next 30 years.

Jimmy Song:

And often times like you know, these congregations will shrink and then you get into sort of like a deflation or like a sort of like a church deflation or deflationary cycle where you get less congregants and, you know, the facilities like you know, start rotting or something like that. And then you get even less congregants and there are so many churches that go through something similar where they enter into a death spiral and then they end up dying. It’s sort of that you know, it’s not very different than what happens with companies or anything else that take on too much debt or you know, try to do things too much. You know, we see this in the VC world all the time where, you know, a VC will just sort of like make these startups like grow as quickly as possible.

Jimmy Song:

And a lot of them just like burn out, right? Like they can, they grow too quickly or they don’t have enough revenue to sustain their level of growth and things like that. And they die off. And that happens like so often not just in companies, but also in churches. And it ends up affecting like the way churches run including taking on even more debt or like using their facilities to rent it out for preschools or for whatever. I mean, I’m not saying that these are bad things necessarily, but oftentimes like they become sort of like a servant to the bank that they owe money to. And that like paying back this debt becomes more important than what their mission or what their stated mission is, which is to serve God. And it’s kind of like, okay, that’s what happens when you bring consumption forward is that you have another master that kind of rules over you. And that’s the unfortunate reality of many churches today. Yeah. It’s interesting how it changes us in ways and can make us slaves to our lenders in some loose sense.

Stephan Livera:

Robert, anything to add there?

Robert Breedlove:

Yeah. I think that’s an excellent point. And there’s a quote by Carl Schmitt that says sovereign is he who decides the exception. And it’s as if when we become borrowers, instead of savers, we’re actually sacrificing our ability to decide exception for ourselves to the lender, right? When things get bad, they have a claim on our assets or on our savings. Whereas if we have savings and things get bad, we have a buffer against that uncertainty, right? We have money that can allow us to weather a few months of no income, or allow us to go into the marketplace and be opportunistic, buy assets at a discount, et cetera, et cetera. So this whole system of central banking that suppresses interest rates, you know, the interest rate is the price of time, right? It’s I give you money today. You give me money plus interest tomorrow, but that interest rate is the cost of time itself.

Robert Breedlove:

And when we try and artificially suppress it, we’re incentivizing people to reap and then, sow, right. Which is the fundamental problem. We’re inverting, reaping and sowing. We’re inverting a delayed gratification into instantaneous gratification. And that just doesn’t work that like fundamentally doesn’t work because who, if everyone’s doing that, who’s gonna create the assets and services that are providing this immediate gratification? If no one’s working to provide it, everyone’s reaping immediately and not sowing. Then it just makes sense that the economic system itself suffers and shrinks. And that way we can, I like to call debt. It’s basically a tool of intergenerational dispossession. So not only are we stealing from the poor in the present, we’re also stealing from the future, right? We are consuming things today that we have not created savings for. That will the economic reality demands a sacrifice be made at some point.

Robert Breedlove:

So it just doesn’t work practically. It doesn’t work morally. And it’s fragilizing to the entire system because when these economic shocks do hit it forces the collateral. That’s been borrowed against to be liquidated. Whereas again, if you have savings, you have a buffer against these economic uncertainties. And it’s, you know, I think this is in our opening passage from Russell that Fiat is basically a house built on sand where Bitcoin is more like a house built on stone, which is a reference to a biblical parable. And I think if we’re going to progress as a civilization, we have to build the thing on stone. And today we’re just built on sand everywhere.

Jimmy Song:

Yeah. That fragility is the main thing. I think that’s so dangerous is that when you get into bed, you’re essentially sort of like taking on leverage. And th this is in all aspects of the entire economy is that when everyone that’s getting into debt and I think we can all agree that most things are up to their eyeballs in debt. We can see that at the consumer level, at the company level, at the government level, everyone is in tons and tons of debt, but that like bringing consumption forward essentially fragilize is you, and this is no different for the church. And that’s the unfortunate effect for, you know, I mean, for something that’s lasted like 2000 years, right? Like there’s so many churches you know, cathedrals that were built like over a thousand years ago, better start was still standing.

Jimmy Song:

A lot of the current churches, you know, they don’t even last, like 30 years, they break down because you know, they took on too much that they leverage themselves. And then when a systemic shock gets they go out and die. So, you know, in that way it’s very sort of against what I think churches should be or what God commands, which is, you know, to wait for heaven, right. Like to save up and try to think more eternally like building on the solid rock instead of building on shifting sand like Robert was mentioning

Stephan Livera:

From a religious and Christian perspective. Some people might be thinking more, Oh, but hang on all this talk about money and materialism. How does Bitcoin help us take a new perspective and have a different attitude on money?

Jimmy Song:

Well, I don’t know if it will be the same for everybody, but what I’ve noticed with Bitcoiners is that they have a much more expansive view of money or sort of like, you know, putting money in its right place. There there’s a tendency to like, make it too high or too low. And by too high, it’s sort of like worshiping it. And it’s like the only thing you care about and everyone is homo economicus is or like treated as sort of like beneath you, right? Like this is the person that says, Oh, money’s not important at all to me. And like I despise money or whatever, neither of those is really healthy, right? Like it’s one is sort of like worshiping it and it becomes like this all consuming greed and that’s not good. And nor is like, sort of treating it as beneath you. I think the right level of you know, caring about it is what the Bible teaches anyway. And I think that’s what we’re all supposed to do.

Stephan Livera:

Robert, what’s your view on how we should think of money and conceive of money?

Robert Breedlove:

Yeah. I like the earlier reference to cathedral building because that exemplifies the type of constructions we create on a low time preference on a hard money standard. But we had these things to, in some cases, 200 or 300 years to construct. So you had individual bricklayers going to work every day, knowing they would never see this thing complete, but just fully engaged in this activity that would benefit the world beyond their own life. Right? So they had this, through either hard money or through their religious discipline, they had this extremely low time preference to the point where they’re taking essentially selfless action over time. And often, by the way, at very high tax burdens, right? Those same workers were often paying pretty significant taxes to construct these religious model. And that’s just, I think that points towards how hard money changes our relationship with money.

Robert Breedlove:

Even just looking at Bitcoin, right? Those that are deeply immersed in Bitcoin, I would say in terms of both their intellectual understanding and their financial positioning, they don’t like Bitcoiners don’t like to spend, right. It’s really hard to part with your sats just by virtue of them, appreciating it, say on average, I don’t know the number 20% annualized return. It makes it really dissuading to you to want to spend a money that’s appreciating so rapidly year over year. And it is very encouraging of saving, right? You want to save this money. You want to sell your chairs as Pierre might say to get more. So you become much more savings focused just by the very simple incentives and coded into the money itself. And then again, savings is the pool from which investments come, right?

Robert Breedlove:

So we get back to building longer term, more sophisticated projects like cathedrals and whatnot, versus the Fiat architecture and whatnot we see today. So I think Bitcoin, it just teaches you. I think Jimmy makes a great point. There’s people that are either just totally obsessed with money or there’s the opposite end of the spectrum, which are these, I guess you can say, like Neo-Bohemians, that just like, I don’t care about money. I don’t need money, but it’s just not, neither one of those is true. Money is just an indispensable tool, right? It’s like a calendar or anything else we need it. It’s useful for coordinating human action. And I think learning and studying what Bitcoin is, and in discovering the true nature of money as a result just helps you place it properly in your own hierarchy of values. Versus putting it way at the top or at the bottom it’s somewhere. It’s very important, very fundamental but somewhere in the middle, I think so. Yeah. Bitcoin is kind of honest money helping us get money back in its right place in our value system.

Stephan Livera:

So upgrading from a bad money, that corrupts aspects of our lives, our characters, the ways we treat the other people, how do you think Bitcoin will change the way we treat other people?

Jimmy Song:

Well first of all, I think you, you tend to value them a lot more you know, like I know that for a lot of people in business, especially like there is a tendency to just sort of like get ahead almost at all costs. And this is sort of like worshiping money, right? Like putting it at such a high place that you’re willing to forgo all sorts of ethics in order to do so. You only need to look at, anything political ends up being dominated by sort of sociopath’s and it incentivizes that sort of behavior of sort of this Nietzschean sort of focus on getting what you want instead of, you know, figuring out what the right thing to do is treating each other a little better and so on.

Jimmy Song:

So and the reason for that is because Fiat money is, you know, like it expands continually. But because there are so many rent seekers, what you get is sort of like a static pie that just you know, like the percentages change and your focus becomes sort of getting your share of the pie, right? Like it’s okay. Where do I make sure that I have a good job that can continually give continuously give me money. I’m not screwed over or something like that. It’s about, you know, getting your share of the pie rather than creating a good or service, which tends to be with a sounder money. So with Bitcoin and you know, the money is scare. So we’re, more free to create they’re less rent seeking opportunities.

Jimmy Song:

So you actually have to go and create something good or a good or service that people want in order to thrive or even survive in the economy. So, in a way, like, by having sound money, you, you you’re forced to serve the consumer. And I am for me that this is part of loving one another, right? It’s not about sort of like pushing other people down, so you can, you can get your slice of the pie and protecting that slice of the pie at all costs. It’s much more about, okay, what do people need, right. This is the essential question that every entrepreneur has to ask is what do people need? And, you know, like that I can fill for them that they would find valuable and, you know, give me some money for that, to me is much more aligned with Christianity.

Jimmy Song:

Then this bureaucratic mess where, you get to be a rubber stamper for some permit or regulation in exchange for some money that, that that’s sort of like a Fiat mentality, think a sound money, Bitcoin mentality is much more one where you’re adding value. And that ultimately causes you to treat other people a lot better as people that, you know, you’re more sensitive to their needs because it’s in your own best interest. It’s ends up helping you find good opportunities in the marketplace.

Stephan Livera:

And so Robert anything to add?

Robert Breedlove:

Yeah, Well, we would call rent seekers, what do you call them gatekeepers? I would call them even just parasites, frankly. They are just tapping into these flows of value between people. And by, I guess, providing the channel, they’re siphoning a rent or a tax, and this may be necessary right. In humanities, early development, because we need certain standards or protocols to facilitate trust over time and space. But over time, the idea at least economically would be to gradually reduce our dependence on gatekeepers and rent seekers or these these parasites, because in the long run they’re taxing to socioeconomic sustainability, right? It’s just you don’t want to, you’re much less inclined to transact in the system where there’s always a 3% tax or an unpredictable tax rate, even so. And it becomes this because they tend to be monopolist.

Robert Breedlove:

There comes to be this natural, this evaluation of human life, right of human time and energy, where they just want to keep the host alive to use the parasite analogy. They just want to be able to suck lifeblood out of the productive economy. And this is just as we’ve touched on really bad morally, it’s just an immoral business practice. And I think, again, where that leads you into these things like low and negative interest rates, which are trying to disvalue time. So again, if we look at life as a product of time and energy they’re discounting it, right. And not just in a marketplace, but also morally. And so I think by Bitcoin reassigning, the proper value to time and energy, we’re properly, it’s introducing, re-introducing the incentives to properly value one another. So we actually gain kind of, as we lower our time prevalence, we gain a deeper respect, I think for human life and time and energy.

Robert Breedlove:

And this gets into what I consider to be kind of the religious qualities of Bitcoin where we have energy that begets life. And we can say, Bitcoin is kind of this first form of at least striving to be immortalized energy, right. A place we can park our time and energy that could in theory live forever. So in that way, Bitcoin is kind of the struggle for immortal life. It doesn’t mean you live forever, but it means you have a place to put your values and preferences and energy and ideas in a vehicle that will in theory live forever. So we get this ability to protect our wills and values beyond our own individual lives and all of that all the incentives surrounding that and all of the abilities that Bitcoin gives us, I think just really puts a lot of downward pressure on our time preference. And when you become again, lower time preference is kind of a broader time horizon. I think that makes you naturally become more selfless. You just start to see yourself as one small piece in this grander cosmic game. And I think that’s where the love comes from because love is selfless action, more or less, right. You’re taking action on behalf of someone else. And I think just by virtue of Bitcoin, making us more selfless, it’s more conducive to a loving civilization.

Jimmy Song:

I would also add that like essentially what Robert’s talking about there is Fiat sort causes this narcissism, if you will, where you only care about yourself and it almost forces you into that sort of mode because you have no other choice, right? Like, I mean, there are certainly entrepreneurs still but the more you get sort of authoritarian control, especially like in today’s day and age with with all the lockdowns and things like that, and the government telling you what you can or cannot do, and they essentially compensate you for following their rules. Yeah, it makes you very narcissistic. It makes you only focus on yourself and you know, not not care about what other people are going through. And but you know what, once you start becoming more entrepreneurial and stuff, you start caring about other people and even across generations and, your legacy and what’s going to happen. It doesn’t just expand in terms of you know, your perspective like outward in terms of the world, but also across time. So, you know, your, your view just becomes more expansive in many different dimensions and that in turn causes you to think about it more, it makes you sort of a more just person that is able to see things from a greater perspective, instead of a very narrow perspective of just yourself.

Stephan Livera:

I really liked that aspect of the book. And that’s part of where it finishes up with this idea of taking on a grander greater perspective. And it’s not just about ourselves. It’s about our, where we fit in into the broader piece of society. And I found that quite a good part of the book. And so for me, as you guys probably know, and many of my listeners know, I often talk about the Ethics of Money Production is one of my favorite books, but unfortunately I think the book was written just before Bitcoin may be just released, like just after Bitcoin. So it doesn’t include any discussion on Bitcoin. And so this is a great kind of an updated if you will, but a short version the book is only a hundred pages, so quite a nice, easy read as well. So probably a good point to wrap up here. So guys, where can listeners find the book and where who are the right sort of people, they should be gifting it to over this time period.

Jimmy Song:

You can find the book on Amazon, it’s available for the Kindle and on paperback. And we’re working on the audio book right now, and actually George’s busy recording it as we speak, but yeah, it’ll be available on audio book as well. Where we’re thinking about doing some sort of a podcast series that sort of like evergreen that’s related to the book, just sort of like discussions as Robert mentioned, we’re also thinking about having some sort of like Bible study questions as well for church groups that may want to study it. I would say that the people that we are targeting are Christians, but much like your Jörg Guido Hülsmann Ethics of Money Production. You know, it is a lot more sort of like about the economics as much as anything, you know, Ethics of Money Production has a lot of discussion of like church history and things like that.

Jimmy Song:

But it’s still appealing to a lot of people that maybe aren’t familiar with that because they still want to know about the ethics of what’s happening. And try to provide that in our books, so it might be appropriate for them really. It’s a moral argument for Bitcoin. And I would say that you know, if you’re interested in that moral argument, instead of just sort of like the investment case or the self sovereignty case, or the privacy case or something like that, all of those things are important, but for me, the moral case is what sort of gives it that extra oomph or that extra motivation for people to really understand it at a deeper level, because if there’s a moral case to be made it’s no longer just about the money or just about your own benefit, it is something greater. And it’s something that’s more expansive like we were talking about.

Stephan Livera:

Excellent. And Robert, any closing thoughts from your side?

Robert Breedlove:

Yeah, I agree. Everything Jimmy said is spot on. I would add that even if you stripped out all of the Bitcoin from the book, I think we also made a really strong argument against central banking. It is just an unjustifiable immoral system that causes terrible consequences. So even if I think anyone that would pick up the book would at least have some curiosity about Bitcoin, but even if you didn’t believe in Bitcoin at all, I think you could still learn a lot about the existing system from our book. Yeah. The book’s available on Amazon. I’ll be updating it about it on my Twitter page. And I just like to thank our co-authors. So it’s Jimmy and myself. Well, I said George, Gabe, MJ, Lyle, Derek, and Julia, it’s been a lot of work that went into this book, but I think I feel really good about what the end product was. So I hope the audience enjoys it.

Stephan Livera:

Excellent. Well, thank you very much for chatting. It’s always been a pleasure as always. Thanks, Jimmy and Robert.

Jimmy Song:

Thank you.

Robert Breedlove:

Thanks.