Ok longish post, but hang with me.
I was listening to this podcast with
@Jeff Booth @Brandon Gentile
Jeff pointed out that for every unit of productivity gained by the free market, fiat has to offset it by printing. I’d never considered before that there is a ratio between MY productivity gains and the amount the control system has to print. When they do that, they are siphoning my productivity away from me and pouring it out on the top of the pyramid. I’m a little more than halfway up the pyramid so some of it trickles down to me. Very little reaches the base. It’s wildly immoral.
That got me thinking about AI. (At this point I’m only half listening and half puzzling through all this so I’m not sure if these were Jeff’s ideas or mine). AI is producing productivity gains like the world has never seen before. So they have to print to offset that, right? But we’re not seeing major changes in the trend yet. They’re printing at roughly the same level as before and AI has entered it exponential phase.
Something doesn’t fit.
They have to overcome this boost of productivity but they aren’t doing it with printing. Then it hit me. They have another lever! They can keep deflation from taking hold by destroying energy infrastructure and causing a spike in input costs for everything downstream of oil. Literally capital destruction through meaningless war to keep the abundance of the free market from overwhelming their control grid.
It’s not inflation in the strict Austrian sense that “inflation is everywhere and always a monetary phenomenon”, but it directionally has the same result. Prices rise to offset productivity gains flowing through the market and the gains accrue to “the right” people instead of the creators of the productivity.
In that sense, the war in Iran is not just a war on the Iranian people, it is a war on everyone. It’s cliché to say that all wars are bankers wars, but I finally understand viscerally what that means.
Destroying capital is a short term fix. You can only do so much of it before you loose control of the machine. Printing is their special power and eventually they will revert to it. We are under attack but if you hold Bitcoin in self custody, as they spray you with the water cannon, you can capture every bit of that water in a balloon and eventually walk away with all the energy they wasted as they lie gasping for breath.
Thoughts?
Spotify
Jeff Booth: This Is Biggest Investment Opportunity In Centuries
Playable Characters Show with Brandon Gentile · Episode
