Hi, I'm Max Kaiser.
This is the Kaiser Report.
You know, America's becoming one big ghetto with heroin addicts nodding out everywhere,
across every socioeconomic plane of existence, every group.
Stacey.
Max, the thing you're trying to bring up is the fact that if you tune into the news
where you go to look for analysis of what is happening in your economy, what is happening
in your culture, your politics, to understand the world around you, it's all Russia, Russia,
Russia, Russia, Russia, Russia, Russia, Russia, Russia, Russia, Russia, Russia.
In the meantime, I think Russia's like five or six thousand miles, eight thousand miles
from here.
Well, if you count the whole country, it's like thousands and thousands of miles across
Russia.
But right here in this country, I saw this image.
It's a video of these clerks at a gas station shop.
You know, we've just driven across the country and there are many of these gas stations,
little convenience stores on the gas station.
And here are these two women nodding off while the customer is trying to pay for her goods.
And it just made me feel so sad for the fact that this is happening here in this country
and nobody is talking about it or putting into context what is going wrong, what is
wrong.
Yeah.
Well, it's called the ghettofication of America.
And if you listen to Gil Scott Herron, one of the seminal street poets, spoken word geniuses
of our era, you know, you would know that this was coming.
Basically, America doesn't want to deal with the fact that it's been abusive toward its
minority population and put them into economically disadvantageous ghettos, which have led to
drug use, heroin use and all kinds of problems.
And as a result of the necessary infrastructure of prisons to maintain the ghetto of America,
primarily the black population, there's no more money left for the white population.
So the ghettofication of America is spilling over now and obviously you've got these two
white women.
Well, that's what I want to say.
Okay.
But the fact is what I think is actually the problem relates to our first headline here.
And that is the copyright cartels, the sort of oligarchization of America.
The fact that basically we have a Pablo Escobar like situation.
You and I covered it before on the tobacco trail, the carnage trail.
Here this town Durham, North Carolina was built on the tobacco industry, the cartel
that the Duke family ran of the tobacco industry.
Today we have an opioid epidemic because of the cartels from Connecticut, the family in
Connecticut that runs the opioid epidemic.
But now this also, the fact that we have these oligarchies has basically led to a situation
where not only are we pushing drugs on people, but there's no hope of ever rising because
here's a study and this is from the New York Times, this headline, myths of the 1%.
What puts people at the top?
Dispelling misconceptions about what's driving income inequality in the U.S.
So the study looks at all of the myths of what's causing inequality in the U.S.
By the 1% owns 20% of all the wealth in the United States.
Basically they look at all the other OECD nations and by comparing the arguments they
can find out that it's not trade, it's not the rise of information technology, it's not
about unions and it's not about immigration either.
Because if you look at other nations with more immigration or more trade or more IT
than America, they don't have the same situation.
What they found is that it's actually basically the cartels or the government intervention
in certain industries and we'll go into that in specifics, but it's things like the fact
that to cut hair in the United States, you have to spend like $2,000 to get a license
in many states just to have the right to cut hair.
Barriers to entry have been erected all over the economy, all over through various services
and stuff.
Right, the oligarchs, the wealth concentration, the bureaucratic concentration is sapping
the economic vitality from this entrepreneurial nation called America and the machinations
and the costs associated therewith of keeping this huge prison population in place are draining
money away from all aspects of society and you've got the problems that you would normally
associate with the ghetto, like people nodding out in the middle of the day on the middle
of the street, heroin nod, just nodding out.
I lived in Harlem for four years and I'm quite familiar with what happens to a community
when it's run by heroin gangsters and what this does to folks and now we're seeing it
across every socioeconomic strata of America because the same freaking gangsters are running
all of society, the same drug pushers and opiate pushers that we use to condemn in places
like Harlem and other urban areas are now running economic policy in America.
So we've got a nation of freaking nodding heroin addict down there at the convenience
store, you know, all jacked up looking for a hit, you know, and freaking crack whores
are running everything in America.
The crack was jacked up.
These people just want to nod out because like this study, by the way, is by Jonathan
Rothwell and he's a senior economist at Gallup and when you're talking about the 1980s when
Gil Scott Herring was alive and kicking and offering his poetry to the world and explaining
the situation of the ghetto, of America, of American society, of the B movie sort of vacation
of America.
So, okay, okay, you can't because of copyright cartels, you can't even do that.
So the fact is that in 1980, the top 1% owned their share of the national income was 11%
in 2014, it was 20% and it's increased even more.
No other nation in the 35 member organization for economic cooperation and development in
the OECD is as unequal among those with comparable tax data and none have experienced such a
sharp rise in equality.
So what's going on?
The Gallup economist looked and he said that almost all of the growth in top American earners
has come from just three economic sectors, professional services, finance and insurance
and healthcare, groups that tend to benefit from regulatory barriers that shelter them
from competition.
Of course, we've talked about Obamacare, this is like part of the health cartel is right
here behind us, Duke is like part of that whole cartel system of healthcare in America,
but they have benefited from the regulatory barriers.
Dean Baker, he's covered, the economist out of Washington DC, he's covered the fact that
doctors, for example, you can't just, we can't import through immigration doctors because
they need to get all the medical certification here in the United States.
Even if they've been trained in France or Germany or United Kingdom, anywhere in Europe,
or Hong Kong or Singapore, great doctors, great healthcare systems there.
They can't just come here and start offering services to Americans.
They have to get, you know, spend hundreds of thousands of dollars to get the certification
required to practice here.
My sister now got bit by a rat and whitey's on the moon.
You know, the revolution will not be televised, ain't nothing but a B movie.
The fact is you've got regulatory capture, you've got the capture of these industries
of the American economy and they're beating the hell out of people every single day.
This is like the Harvey Weinstein ization of the American economy where everyone is
just getting unmercifully violated 24 seven by these cartel, you know, snot nosed jerk
offs that are just, okay, let's talk more sophisticated language here to offer better
poetry than what you're doing here.
So again, so the groups that have contributed most of the 1% since 1980 are physicians,
executive managers, sales supervisors, and analysts working in the financial sectors
and professionals and legal service industry, executives, managers, lawyers, consultants
and sales reps.
So all the protected industries.
Both of these changes is largely domestic service industries, finance, healthcare, and
the law.
The United States would look like Canada or Germany in terms of the top income shares.
So again, remember, by the way, we're outside, you might hear some airplanes, you might see
there's some Amtrak train going past by there, you might hear noises around us.
Just so you know, there's noises.
But here, so you don't see, you know, checkout counter staff driving across Germany on the
Autobahn.
You don't see people nodding off at the checkout counter there because, of course, they've
got some dignity, they have hope, they have hope that, you know, that the government's
not going to prevent them from accessing the economy around them.
Right.
You mentioned the government there is not going to allow for certain things.
And of course, in America, there's a huge population that equates the government with
something diabolical and evil, even though the government is the United States Constitution
and the Bill of Rights.
So the government is the what?
Yeah.
Well, that's right.
I'm like nodding with you.
You're nodding?
I'm agreeing with you.
You're not oping it out.
But I'm not nodding off.
You're not nodding out.
I'm nodding agreements.
Oh, yes.
And however, here they are saying that the government in the United States is owned by
specific groups of industries that are setting up regulatory barriers to anybody entering
that system.
That's why I think every millennial in the United States runs a coffee shop because there's
no cartel for coffee, apparently.
But the problems, so they go through why these industries are protected and how they're protected.
What they say is that the problems cited by these analysts include subsidies for the financial
sectors risk taking, overprotection of software and pharmaceutical patents, the escalation
of land use controls that drive up rent and desirable metropolitan areas, favoritism toward
market incumbents via state occupational licensing regulations.
For example, associations representing lawyers, doctors, and dentists that block efforts allowing
paraprofessionals to provide routine services at a lower price without their supervision.
So the government is erecting barriers.
I will nod agreement with that.
Well, look, here's the big secret.
In America, there is no government.
There are only corporations.
Yes.
And we're actually going to talk about that soon.
I want to talk about this Amazon headquarters.
And this is very important that your cities, I mean, we are entering a needle, neo feudal
corporate state for sure.
And I think what we see with Amazon basically pitching for a second headquarters, pretty
remarkable.
Right.
As part of the deal, they are offered to actually run the government in these towns that they're
pitching for.
There's much more about this coming your way, don't go away right after the break.
I've played for many clubs over the years, so I know the game inside out.
Football isn't only about what happens on the pitch or the final score.
It's about the passion from the fans.
It's the age of the super manager, billionaire owners and spending 220 million on one player.
But it's an experience like nothing else on earth.
And because I want to share what I think and what I know about the beautiful game, I agreed
to one more transfer.
And this is my new team.
Afghanistan is not a good place, it's not a good country and it's not a good country.
Afghanistan needs good coaches.
Islam has been forbidden in the world and is now famous in the world.
They don't accept it, they don't accept it.
And Islam rejects every action.
They always practice because they don't make a deal.
Whether he is a Muslim or not, they don't make a deal.
For example, if a person comes back from a night club,
and remembers Bruce Lee,
Bruce Lee will be taught cinema and sports.
It will be very good for them.
You're smoking a cigar, and I think you're shooting a gun.
Well, I've got my Make Bitcoin Great Again hat on.
I may or may not be holding a gun, you can't tell.
I can't tell, but I've seen some other photos.
You're holding guns.
Now, you talk about Bitcoin in terms of individual sovereignty.
One of the things that I really like about your approach to this,
and can you talk a little bit about what that means?
Sure.
I mean, to me, the reason that we got into this entire mess
and created this Bitcoin software
and everything that has spawned off of it
is simply because we, for generations, if not the entire sum of human history,
have put trust in other people to take care of the accounting ledgers,
to take care of really power in general,
creating these hierarchical power structures.
And it makes sense that that has happened.
It's more efficient.
It allows society to work pretty smoothly,
but you're making a lot of trade-offs.
You're handing over a lot of your own power to somebody else
in order for you to go about your life being an ignorant fool, but happy.
Right, the layers of trust in the system.
When you think about it, everything we do, you're on the road, you're driving,
you're getting your licenses, you're starting a business,
you're at various institutions, and everything is layers of trust.
There's government layers of trust.
And so Bitcoin essentially has reinvented how we manage trust in our society
because it's through this protocol that has developed consensus,
which is not centralized,
and because it's electronic and digital, it's frictionless,
or the cost is almost zero.
I mean, going back to the old days,
I lived in a little town in the south of France called Villefranche-sur-Mer,
which started with pirates saying to the residents,
give us a yearly sum of cash and we'll protect you with our pirate ships, right?
I mean, that's the history of society is that mercenaries protect the town.
And now that's not really needed anymore, right?
Well, at least from the monetary standpoint, yeah.
We said, hey, we could flip this whole model upside down.
And instead of us trusting certain entities,
instead we are going to track everything ourselves.
We are going to validate our rules, and we're not going to trust anybody.
And then we'll just create protocols and use the technology
that has been developed over the past generation or so
in order to be able to automate our communication
and automate our trust with each other.
Let's talk about the intrinsic value of Bitcoin for a second,
because one of the easiest ways you can make the case is to say,
well, look at the protocol behind email, right?
Or the Internet itself.
Anyone could come up with a new email protocol.
But at this point, it's so entrenched and so universal
and so prolific and out there.
The chances of that are very small.
The people who argue, who are in the gold camp,
who say it has no intrinsic value, don't understand that aspect of it.
And they don't accept the fact that, well, yeah,
you could come up with a new email protocol,
but I could also mine gold on an asteroid.
I could also mine gold from the sea.
The probability is minute.
So it's not worth considering.
What do you think of that?
It's funny because I actually worked on email platforms
before I got into Bitcoin.
And yeah, I mean, email protocol, it's very old, it's outdated, it's simple.
There's so many things you could do to make it better.
But the network effect is so huge,
nobody wants to try to overcome that network effect.
It's just not worth it at this point.
We just build more stuff on top of it, keep going.
And that's essentially Bitcoin.
And there's a few examples of this protocol
throughout the technology industry, the HTTP protocol.
These are protocols that are prolific, et cetera,
that have a huge value.
And can you build on that a little bit more?
We have these protocols that have, over the years, become very stable.
People have come to learn, I guess, the kind of eccentricities about them.
And it's become a standard.
And so once you have that standard, it's hard to change it,
but you can try to extend it,
add more things on top of it, or even create other layers on top of it.
So I think that that's kind of the perspective
that a lot of people on the Bitcoin side are saying,
is extend and build on top of rather than try to replace,
which is what some people are trying to do,
but there's just a lot more technical and human challenges to overcome
if you want to do that.
It seems that despite the efforts of big bank style like JP Morgan
or countries like China to try to derail the Bitcoin freight train,
they're failing.
Is this the genius of Satoshi?
And where is this going?
Well, you know, it was probably inevitable.
Satoshi just happened to be that lucky person or group of persons
who really found the right combination of technologies and game theory
to put it all together.
I mean, this goes back decades,
so somebody was probably going to figure out eventually.
Right, you have three things that I see.
You have game theory, you have Metcalfe's Law,
which is the networking effect, essentially,
you have increased returns, economics in play, the mushrooming,
the old example of the fax machine.
You know, one fax machine is worthless,
two fax machines are kind of interesting,
but once you get to three fax machines and four,
the value of the network expands exponentially with each new node, right?
So this is Metcalfe's Law.
Then you have to add to that Thayer's Law of good money chasing out bad.
You put those three things together, as it's done in this protocol,
and you end up with a runaway freight train of value, asset trading,
that is undefeated, undefeatable, and we're at the space.
Do you agree with that assessment?
That seems to be the case so far.
There are, you know, plenty of skeptics out there who believe that, you know,
something even better than Bitcoin will come in and replace it,
and, you know, the market will decide, but so far so good.
Futures contracts are being launched, and Wall Street's getting into the game.
A lot of people say, well, you know, in the gold market,
the problem is all these futures contracts, they manipulate the price,
and they're keeping the lid on gold prices.
How do you see that playing out in the Bitcoin space?
There are some people who think that, you know,
it's going to short Bitcoin into the ground,
but I think that a more likely outcome is that, you know,
shorting Bitcoin is a terrible idea.
Anyone who tries to do that is going to get wrecked pretty hard.
Well, let me ask you this.
So in other words, if you look at what's happening with Patrick Byrne over there at Overstock,
he's launching T0, which is zero confirmation date,
which is the trading in Bitcoin is the confirmation.
It totally disintermediates Wall Street.
The total apparatus needed to do naked short selling
and all the things that have crippled the gold market for so long
are going to be blown away as adoption of Bitcoin takes hold.
So initially, you might have some of this problem,
but the protocol is going to kill those guys.
It's going to kill them deader than a bag of doornails.
Well, and this is just a transitional period, right?
I mean, we're still using the dollar as the unit of account,
where what we're trying to get to is the point where we're using Bitcoin as a unit of account.
So I think it's only going to last for so many years
before we get to that hyper Bitcoinization that some people are dreaming of.
Right. Well, so I mean, Patrick Byrne Overstock is...
I don't know.
It just angers me to think that there's still Jamie Dimon still breathing oxygen in this world.
That's serial terrorists like that.
Everybody, let me move on.
So you, Seth, identify as a cypherpunk. What is this all about?
So the cypherpunks, the origin of the movement really goes back to the 80s.
A bunch of nerds who they saw the promise of the Internet and these new communications technologies,
but they also saw the dark side.
They saw what could happen as a surveillance state comes in
and uses these technologies for evil, basically.
So they wanted to build privacy enhancing technologies
into the Internet itself on top of the Internet protocols.
And it just so happened that digital money was one of those very interesting things
that the cypherpunks thought was important for society to have.
And a number of cypherpunks worked on it for decades.
And it wasn't until 2009 that Satoshi came along and actually had an elegant solution.
There were many, many attempts and failed solutions that happened before Bitcoin.
There are estimated 4 million Bitcoins now that are lost.
I've lost God knows how many Bitcoin, enough to buy this building probably.
What do you think about this?
So the actual effective number will not be 21 million in total.
It'll be probably closer to 17 million.
What are your thoughts on this?
And we'll never know for sure.
I mean, you can use various methods to try to estimate that.
But that's kind of part of the game, right, is that this is a lesson in responsibility.
I mean, it's a lesson in self-sovereignty, which means responsibility.
So the people who get into Bitcoin without understanding what they're getting into,
they may get hacked, but more likely they're just going to be negligent
and they're going to lose their Bitcoins.
And that will be their learning lesson.
Yeah, I mean, every day people are saying, I had a thumb drive.
I had a hard drive.
I had a paper wallet, you know, with a few Bitcoins on it.
I don't know where it is.
I lost it. I threw it away. I gave it away.
And now this is quite meaningful in terms of dollars and cents.
And that's the learning lesson.
So what are your guide to Bitcoin survival?
Because you're somebody who seems to keep your equanimity intact
throughout all the drama and all the price moves.
How do you do it?
What's your guide to survival, Jameson Lopp?
Lots of backups, lots of testing.
I mean, the main problem right now is that there is such a high learning curve.
And so I just tell people, you know, do not put any money into it
until you feel like you understand it enough to be safe.
And so that for some people, that means just copping out
and sending their coins to Coinbase or Zoppo or some trusted provider.
For a lot of people, that may be a safer option.
But if you really want to go like full self-sovereignty, full responsibility,
you need to put in the effort.
And we're talking not just hours, but probably days, if not weeks,
of effort of teaching yourself
and then actually going through the motions of testing
and doing the appropriate security measures.
And I have plenty of articles and blog posts about the minutia of that.
Yeah, yeah. What's the website with all the links that you have?
Everything can be found on lopp.net.
Lopp.net. And yeah, you know, go there all the time.
And who else is in this space, you know, that I follow?
Trace Mayer is really fantastic.
Andreas Autanopoulos, he put out a lot of videos, which are very good.
And Peter Todd, you know, if you want to get more of a technical thing,
he's got some really great, you know, videos out there.
And so what do you think is going to be the next stage in this ride?
So, you know, more philosophically speaking,
what are we going to see in the next couple of years
as money becomes anabsterized, as money is taken from the central banks?
The central banks get redundant.
So what does that mean?
I mean, we talked about people's individual sovereignty.
We get that a lot. But what does it mean?
What else? Go run with that a little bit.
I mean, that's going to change the game significantly.
So, you know, we're already at a point
where there are so many honeypots out there
because now this digital money is a lot more tempting for hackers
to try to get to because once they get it,
no one can take it away from them.
We're going to, I think, see some, you know,
innovative new types of criminal activity,
and we're going to see some innovative new types of commerce
and regular interaction from an economic standpoint.
So I'm very interested to see what happens
when we can create a completely new type of economy,
especially one that's like based on microtransactions, you know,
trying to get to that.
What I would I would ascribe as a crypto anarchist
or anarcho-capitalist utopian voluntary future on the Internet.
One example of that might be that like the yours platform
where you're paying micro payments to authors
and, you know, instead of having advertisements…
Brian Charles X.
Yep.
I follow him on Twitter as well.
Yeah. So, you know, the idea was…
In other words, Y-O-U-R-S.
Yeah.
So it's micro.
Anyway, I think we're out of time, right?
But, OK, it's an excellent idea.
Microtransactions enabling more peer-to-peer
and the financialization of everything we do in society
without any intermediaries whatsoever.
Making the incentives more clear by actually paying people,
you know, when they give us something of value
now that it'll be so much easier to pay tiny, tiny amounts.
All right, cool.
Jameson Lopp, thanks again for being on the Kaiser Report.
My pleasure.
That's going to do it for this edition of the Kaiser Report
with me, Max Keiser, and Stacey Herbert.
I'd like to thank our guest, Jameson Lopp.
You can find him on Twitter at Lopp, L-O-P-P.
If you want to reach us on Twitter, it's Keiser Report.
Until next time, bye, y'all.