YouSaid · the spoken record

Matthew Pines

lines on the record: 80
first: 2023-03-22
most recent: 2023-03-22
sittings or episodes: 1
sources: podcast

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“Yeah, it's quite a little bit thick, and then BPI, Bitcoin Policy Institute, that's where I'm Nash Security Fellow. And yeah, I think they're going to be doing a DC policy summit in April. So look up the Bitcoin policy summit. It's invitation only. But if you're in DC and you have interest in Bitcoin, Nash Security and larger policy questions, reach out to me, David Zell and Grant McCarthy are the ones putting it on. We'll link to get folks invitation for that. And also support BPI's work. They take donations and yeah, I think they have, I think, higher ROI on every Satoshi they receive in terms of their broader educational efforts inside DC. So yeah, keep myself busy.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yes, so certainly I'm on Twitter. I sort of just think in public at Matthew underscore Pines. Just hit me up. I just tweet about random things and geopolitics, cyber, macro, whatever things that seem to catch my eye. If you happen to be a C suite executive and are confronting some strategic coupling between your geopolitical and your cybersecurity risks, that is my day job. We spend a lot of time advising multinationals on those exact questions. We're on the Director for Security Intelligence at the Krebs Stainless Group. So look us up there. If you want to engage me as a professional capacity. And then I actually published a novel Expectation Value. So it's basically a science thriller about quantum computing and AI.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“It gets the people going, man. It gets people going. I think that's a long conversation. Yeah, it should be interesting to yours, I think, on that issue.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“You're a Starlink. Great, right? For you, maybe you don't have a whole lot of territorial attachments, but most people have like civic and social and political and familial attachments to where they live. And that means you've got to engage politically with where you exist. And that means voice. Where I would say, like people, I think we're index on the exit properties of Bitcoin. And I think that makes them discount the importance of voice. So”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“You kind of have to just like talk to the right people and make the argument. I don't know. It's probably a larger question for how Bitcoiners should just be a little bit more attuned to, again, it's kind of the irony of like this originally libertarian project trying to create like common goods, especially in their own civic jurisdictions, right? It's a global project, but it has very much like a local territory, depending on where you live and what jurisdiction you're subject to, right? Some of that potentially Bitcoin on a global basis. It's about protecting your access to the Bitcoin network wherever you live, right? Which I think you have two options in general. Any political theorists like voice and exit. You can always leave, but that has a hike, that has lots of costs to leave a certain political jurisdiction. I think Bitcoin has been too quick to think, I just take my seed phrase and I bounce. And it's like, okay, maybe you're like a single dude who's got no material possessions and no family and social attachments. You can just post stuff in some Costa Rican jungle and like live off your coin.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Good question. This is the thing that I'm not deep in fundraising for BPI. I just help do with national security stuff. But I do know that it's heavily cyclical in terms of bulls and bear markets. And Bitcoiners, you'd be surprised. I want to just easily, you know, give up their coin. So this is, I think, a tough environment for nonprofits in general to try to fundraise, especially where Bitcoin is a decentralized open source project, right? There's no corporate interest on the line. There's no shareholders or public or private financial interests that can easily see like, I need to protect my moat. I need to get this regulatory provision in because my business model requires it. Like the function of lobbying is structured around having those sorts of outside incentive structures drive particular lobbying and advocacy efforts in general bitcoin doesn't have it. There's no CEO. There's no like central planner who's like, this is our strategy for Bitcoin regulatory priority.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“A crazy person. It's like the same thing on Twitter, right? Like, do you respond to trolls? Like, no, just no. You're not contributing to a positive discourse. So people are going to just tune you out.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I think the key is it's also important to be respectful in this, right? What will be not productive is if it's like a harassment campaign. You're an idiot, you don't get it. Bitcoin's going to succeed. It's like, sorry, that's not going to win you any friends. So being polite, be respectful, be curious, offer to help. These things are pretty common sense, right? In a civil society, but sometimes you have to say that.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“much bigger population the threshold was probably an order of magnitude higher for the typical senator's office and then for the white house it's like an order of magnitude higher there so it's like that's probably my heuristic”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Probably different in each office depending on how responsive their particular congressman feels. Well, it doesn't take much. I'd say like even like a handful of personal letters or personal phone calls could get elevated. Someone certainly asking a question at a town hall meeting and like someone who's credible and was like, I want a response, right? That will get a response. Congressman will remember that. He's like, oh, that person was asking about that thing. And I didn't know quite what to say. Like, I don't want that to happen again. So it doesn't take much. It doesn't like you need thousands of people. Yeah, it doesn't, especially in the House of Representatives. In the Senate, it's a little bit more of a machine.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Not advocating really from much. He's just like, we can be resourced to help you as you're confronting this really complicated thing, which is digital assets more generally, and in particular Bitcoin and its role and how it works and how it could help in these different dimensions. And here's some rigorous research and here's how to sort out sort of signal to noise. And that's been really well received, at least that I've heard from him is these are junior staffers, they're 20-somethings that are tasked with a broad portfolio, and they're just going to Google their first response to a question. That's an easy thing to like improve. Like that's low-hanging fruit so that the first thing isn't just a debris digonist thing. It is like, they're going to find that no matter what, right? Because it's been search engine optimized everywhere. But like get them something else.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Like, what are new things being asked about? So, if he goes to a town hall meeting, he doesn't get surprised on the spot, doesn't have anything to go to. The worst thing that can happen, not just in Congress, but like any environment, is like your principal, whoever that is, your boss, the C-suite executive, the cabinet official, the president, the congressman, the senator is like the worst thing that can happen to them is they get asked a question in public and they have no idea what to say. And so they always want to feel like they have some position, whether it's tentative or someone. That does matter. And I know folks that I work with at the Bitcoin Policy Institute, which is sort of this organization that we fill you with on the side just to like help out with Bitcoin policy in the national security space kind of analysis and outreach. Grant McCarthy in particular, who's the co-founder with David Zell of BPI, he's had dozens of meetings on the hill with staffers from both sides of the aisle. And I talked with him about what that experience is like. And he's going in there and he's a really good talker and a really good listener. And he's not trying to.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Say, like dozens of these form letters, and then you had you could go to and be like, this is the conversation's position. We appreciate your interest. He's got an upcoming vote. So you'd have to like tailor it a little bit. But that was a key function of the office was respond to constituents. And we tracked what topics are being asked.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so one of the main jobs as intern, aside from giving tours and learning slash making up facts about why a certain stain on the marble might have been from a duel that happened 100 years ago and actors probably to someone's coffee they dropped, right? You got to spice up the tour when you're doing it for the 10th time was responding to constituent emails. And every email had to get responded to. Every phone call had to take notes on what the phone call was about, write up a summary of what the phone call was, and then respond to it's like every single representatives, it was like every single contact had to be responded to. Now most of the time you have like standard issues, right? Can someone complain about gases or gas prices or taxes or the war in Iraq or whatever? And so you had like a standard form letter.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think central bankers are defending themselves more from just Bitcoin in this current world. I think they have got a lot of challenges, and I think this is manifested in some anxiety that comes out with remarks like that.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“The problem we're running into now is like, do politics, technology change, national political pathologies that are coming up and potentially undermining that claim to legitimacy that they've relied on is fundamentally threatening their existence. And I think Bitcoin is just like the most obvious, most overt challenge to them, right? It's like literally addressing them head on is like we're here because we don't like you and we're going to do our own thing. And if we succeed as sort of a demonstration of your lack of credibility so that obviously like that is like a political challenge, right? More than even a monetary challenge. And this scheme of like, we're in a narrative world, right? Where it's all about memes, right? It's like memes and vibes run everything. They're trying to win the memetic war, right? Is framing the issue in a way that's favorable to them. That's the thing where we are now.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“In these small cloistered clubs and say, this is our plan for the world. We're going to do this, right? It wasn't like this nefarious cabal of like, this is our scheme. It's like, this isn't the world allowed them to do because we were in this sort of more stable arrangement and they could effectively do that.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“In their heart of hearts, they're actually more worried not about Bitcoin. They're worried about state capture over them taking away their independence. BIS has diplomatic immunity, right? It's like that could be taken away pretty quickly. They get nice, they have a nice life. A lot of perks. A lot of perks. And they had a lot of power and they were sitting, if you think about it from the perspective of institutional power and how that conveys personal status. Human beings are status animals. We won't always want to be at the top of the different status hierarchy. And the sort of Halcyon days of the American Unipolar Order, globalization, finance capital ran the world central bankers were like the top of the pyramid. They were able to make the argument successfully that they were independent from politics so they could sort of step aside the sort of scrum of national politics and they could sort of take a larger view, a more technocratic view of the global order and try to like smooth out the business cycle, coordinate policy across all the major leading economies meet together.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I mean, it's a clear demonstration. They actually listen to what they say, right? They actually have a view, the liabilities that they issue as their property, that they control access to, right? So they have the responsibility and the authority, nominally granted to them by the Constitutional Processes of the States who have given that charter, some of which may be more legitimate than others, right? And there's certain challenges in our current institutional framework that even central bankers are pointing to. So like Paul Tucker, who was the number two Bank of England super well respected monetary official. He's also, I think, now at Harvard. He's written a book called Global Discord. It's a great read, kind of very technical and academic, but he's really drawn a bright light at this issue of the potential legitimacy problems that central banks have, especially in the modern era and how this is now becoming overlaid with the geopolitical frictions to really put central banks in a difficult spot. And I think Bitcoin is like a convenient stalking horse for them to kind of like poke at when they're really anxious.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Except they have been given a state monopoly to issue that product. And so they view any competitors to that product as a threat. And what else everyone else does in a competitive environment is you talk down your competitors and you try to make it seem like it isn't even a competition. And these competitors are bad and they'll give you cancer and they weren't.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“So, if you listen to what central bankers say, I have nothing against them personally, right? I'm sure a lot of them are just technocrats, right? Maybe some of them are power seeking malign people. But I at least try to treat them as their institution first and then the person is usually just like an artifact of the institutional prerogatives that they grew up in and they don't hold that job unless they support institutions' prerogatives. And if they don't, they leave and someone else comes in who does. So he's like a character to easy to sort of personify as like big bad man. I try to step behind like what is institutional incentives of the BIS, which represents the central bank of central banks. And they view, like they view the sort of fiat liabilities that circulate as money in the economy, really the banking system. They view this their product. Like they actually view it almost as like a company views a product that they make.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“By the Treasury Department, going back to essentially the World War II and the immediate post-war era where the Fed was just an arm of the Treasury and monetary policy was a political decision. And I think that's not necessarily the best course of action, but that's really what you're seeing behind the CDC argument is this political argument over how do we resolve this imbalances. And does this mean we need to go to more control? That means we need to undermine the Fed's independence, or do we mean do we like try to take advantage of these new technologies in a way that maybe gets us out of the jam?”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“And so it's about corralling global capital into a nice killing pen, give them the Treasury Securities, and then do the Lynn Alden financial repression, inflation, come back to kill 30 to 60% of their purchasing power over a decade. That's like the best case scenario for the government right now. Yeah, so I think CBDC, even I think the Powell, I mean, I've heard is like he's not a fan of CBDC's Kashgari. He's not a fan. Most of the Fed doesn't really want a CBDC people pushing it a more in the White House, especially in the Treasury Department and some people on the Hill, that see the same problem and their solution is just going to be double down on control, right? Eventually, like there's some people who actually just want to cut the Fed out, right? Like it's like the horseshoe theory, right? Bitcoiners and the Treasury MMTs are both like, you know, end the Fed, right? But they want to end the Fed or replace it with essentially direct”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“You don't want to have single points of feeling. And I think in general, right? Like we've had decentralized money, we just haven't really recognized it, except when it breaks. And then the urge is to centralize it and regulate it and corral it. And that has mattered because the back and collateral for that decentralized, the money network has been the U.S. Treasury security. And that we've allowed to minor dysfunction to happen. The problem is because of the global monetary system is structured, economic system structured that we have to run more and more deficits. structurally that means we have to just like print more treasury securities. And so this like this is creating like a tension that is now coming to a head, which is like they can't let this decentralized dollar system continue to operate the way it has because then it won't effectively absorb all of the treasury issuance that the sovereign needs to get.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“And the Fed has recognized this. They put out the white paper like cybersecurity risk is what I do in my day job is looking at different threat models for different corporate networks and other systems. And yeah, the CBDC for the Fed would be like top list for China because that's just creating the most juicy target. And yeah, that would be a big one.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Take where's another mechanism to potentially dollarize the world in a more efficient way in a way that actually helps dollarize individuals who have a need for dollars to feel like they're immediate daily needs as opposed to dollar repo to support the maybe shady dollar funding and like speculative gambling. Should be like acceptable. And I think a private space will issue is much better positioned to meet that need than not to mention.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“floating around. And so it's like, okay, if we allow, and that's been a push and a pull because they let that go too much and then they get ahead over their skis and then things really blow up and they become the cause of the freeze in the global dollar system. That's why you have swap lines. That's why we have these global repo facilities to essentially make money good all of those implicitly money like dollar promises, right? Like there's a bunch of dollar promises out in the global dollar system that maybe don't exactly have a one-to-one fed liability to back it up. And so, you know, but if everyone gets offside and there's a major run in the offshore dollar system, the function of the Fed is to be the global lender of last resort liquidity provider for the shadow banking system. And that's what they've done, but it creates a little hazard in that global system that they're still struggling with, right? So I think stellar-based stablecoins are a version of that same sort of given.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Which is how do you allow elasticity in the dollar markets to function in liquidity needs of the private sector and all of its manifestations that a central planner can't possibly see and recognize with the central algorithm attuning and apportioning credit, right, to whoever needs it for whatever business or consumption purpose at any given time to sort of, you know, that's just like from a computational perspective, not something essential issue we can do. So there's just like sort of this free market for money in the global system and it's regulated by access to collateral and then the inner dealer market of, well, do I accept your collateral in order to trust your sort of dollar token? And that's exactly what we see in like Tether, right? It's like, do you trust the collateral? Maybe you do. Maybe you don't. But there's a market for that, right? And so people will accept that token, that dollarized token to the extent that it meets the purposes, right? And there might be a risk premium attached to it. And that's just the nature of the market we see right now. There's dollar substitutes like that.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Being issued, essentially invented by other financial institutions, also non-bank financial institutions, that do not have direct access to the Fed liquidity window. And that's sort of been the sort of acceptable, and it's created like a bunch of moral hazard potentially because that's the situation right now, which is, and I'm coming back to stablecoins, because I think this is just a new version of an old problem.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“I would agree. I think, you know, in general, I'm in the sort of the George Sheldon camp, at least this part of the monetary kind of philosophical space, where, yeah, I think letting competition for these dollar substitutes in the crypto space work is just an extension of what we've currently allowed in the euro dollar system with dollar substitutes that are generated by shadow banks. And there's been always this sort of the history of basically the post-war era has been the history of the Fed trying to either contain or allow the expansion of the sort of euro dollar market, right? And really that means is the issuance of dollar substitutes that aren't direct liabilities of the Fed through this sort of hierarchical monetary system and where you have commercial bank from the United States that has direct access to Fed money in order to make money good all of its deposits. And that's the premise of the onshore dollar system. Then there's the offshore dollar system, which are dollar subsidies.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Taiwan more, right? And then who's got the, and then it's a game of who's got the industrial capacity to gear up for an guess what? China has all the shipbuilding capacity. China has all the factories. China has all the surplus labor. We've lost those high-skilled trades, lost the industrial capacity, the manufacturing capacity, the shipbuilding capacity. That creates a strategic danger zone. And so this is where the connection between the dollar system that functioned really well for the United States and its sort of its security position in the world has now kind of come back to bite us. And we're trying to struggle with like, well, how do we reconcile this? And it's a political economy problem. Back to my point before. It's like DOD and the IC recognize this is like a big problem. But Wall Street, Silicon Valley, private equity, like the status quo is working, right? And so it's not like one person makes the decision here. It's like a lot of competing dynamics and those people have a lot of money that buys a lot of influence.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Our assets to help, you know, that's like the consultants, right? To help okay, we're going to create a nice debt security for this Middle Eastern Sheikh to buy into as part of this complicated investment trust. And this is why all the London city lawyers, this is how they make all their money. That is a world built around this dollar surplus recycling flows. And it really enriched certain elements of society and it really undermined other elements, right? You can imagine like the pathological political consequences of expanding your fire sector and then undermining manufacturing and industrial heartland right and that creates the political reaction that we saw in the last few years in the West, but it's now also creating a geopolitical and a military dynamic where the military is now realizing we don't have a defense industrial base to actually make all the missiles and artillery shells and ships that let alone just keep supporting this traditional war in Ukraine is straining our capacity. We would run out of missiles in like two weeks in a”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Reinforce this sort of military complex that allows us to then keep structural demand for our assets high, that has worked in an era where the military deterrent credibility was really high. And therefore, we could just have this trade from our assets for consumer goods, basically we will sell off to OPEC Plus in China our most desirable assets, which we have a lot of. We've got a lot of great farmland, a lot of desirable real estate, a lot of great tech companies. All of that is really desirable scarce assets that folks in Russia and OPEC and China kind of want to buy. And so that was the trade is we'll buy your energy, we'll buy your commodities, we'll buy your cheap consumer goods and maybe even more expensive consumer goods as we move to the value chain. And in exchange, you get to acquire our assets. And that's why you have the fire sector grow so much, right? Because the function of the fire sector, finance insurance real estate, is to recycle those capital flows from the net surplus nations into”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so this is where these are all pointing in the direction of structural stress on the treasury market. And yeah, my broader thesis, and this is maybe the connection to Bitcoin, is that we've premised a lot of the geoeconomic sort of power of the United States on the fact that we can leverage our senioridge that we get.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yeah. And that would mean, yeah, I mean, that would be yield growth control instantly, right? There's no way that you get to that scenario when the Fed isn't owning $20 trillion in a few months, right? It just, yeah. So,”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“And like you might assume there's no such thing as a black salon, and I think we know that's not the case, right? Or even a gray swan. Like a Taiwan scenario is not even a black swan. That's like something like we could reasonably put a”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“We have to meet these climate objectives that we set for ourselves across the world for net zero, and that means doing a lot of heavy capital investment in rewiring the grid and new energy infrastructure. We have to pay out these obligations to our elderly in terms of social security and Medicare, these entitlements that are also like pegged to the cost of living and that we have to sell down that we're actually net liquidating the treasury portfolio to pay out these entitlement obligations. So before they were like a net bid for those because they're sort of matching assets and liabilities and now they're paying out. So all these things are like on the margin don't break the campbell's back, but like you're moving into an era where collectively they're putting more stress on the treasury market. And then you're just waiting for some black swan to come in and like really mess up the application.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, this is the thing. I mean, the history, and this is all stealing from Lynn Alden is like these periods of high structural debts lead to this sort of no-win situation for different fiscal authorities that have competing obligations. And so we running into a period, and I think Paladus today talked about how globalization going to the reverse is going to be net inflationary, right? Like this kind of duh. But really what is trying to internalize what that means is like a lot of things. They're like that I don't think our assumptions were aligned with, you know, only a few years ago. So things like, okay, we have to find more redundant supply chains. We have to change business models. We have to move out of an area that may have been optimal for production to an area that's like second order production because of geopolitical risk. We have to increase our net spending on defense from like maybe a peace dividend era two to three percent to like a more conflict-prone era of three to four maybe five percent of gdp”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“They're double incentivized. Yeah. Or I think it's more in the second order effects, and I honestly haven't thought this all the way through because it's very complicated. It's more in the international domain where net dollarization of economies that are currently not dollarized. If stablecoins can help affect the dollarization of those economies, then the local institutions and banking systems that get then sort of crypto dollarized, maybe not by their own sort of national level decision making, but sort of through the organic adoption of these dollar-based stablecoins, that they have to hold matching dollar assets. And that contributes to kind of a net liquidity bid to a broader spectrum of dollar debt securities in international funding markets. So there could be like an indirect effect where just in general, there's more dollar demand and therefore there's more demand for dollar substitutes along the money curve. And so like that raises the net demand across the”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“So, which is really in the policy rate area where the Fed kind of controls that rate, anyways. And so they might not have that much of an effect unless they're allowed to buy longer dated pay paper. They can go out and buy 10-year paper and then do more complicated kind of hedging.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, that is an interesting kind of interesting development, right? Which I don't think was in their models a few years ago. Here's a net new bidder for treasuries. And I have a nuanced perspective on this. I think on one dimension, it's good to have a new buyer of treasuries when you might be missing buyers of treasuries from existing sources. The market will find a clearing yield. And if there's a net buyer, maybe the yield is lower than otherwise would be for you. And that makes your servicing costs lower. The question for me is, though, where on the curve does that actually matter, right? And if they actually are functioning more as like money market funds or like highly regulated narrow banks that have to just only hold the most high quality liquid assets, that might be like three months or one year less.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Doesn't matter, like everything else we think is important. They have to come in. And so they're trying to do two things. They're trying to both stabilize the treasury market, which I mean, it's the most important market in the world. And yet it's also like very inefficient from the perspective of overall pricing. Like there's no common feed, right? for the treasury market. There's all these different issues. And so this complicated fractured trading market between dealers and OTCs and it's like a complicated thing. So they're trying to do on that side like stabilize the treasury market's market structure with things like central clearing where and then like more like real-time”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“And just like print money effectively off the back of the Fed's policy. And I think that has created distortions in the overall financial system that got really hypercharged with pandemic because we just had to kind of just throw money off the door and guarantee corporate credit and do all sorts of things that would be sort of unthinkable. And now the Fed's trying to like put the genie back in the box, right? Trying to unwind a lot of the moral hazard that may have been implicitly baked into the market and priced into a lot of these different securities markets. And I think they're trying to, but in a controlled way, kind of do a controlled demolition of those parts of the market that they feel like were overly inflated on the backs of this implicit role has it if it was just going to guarantee all this commercial paper. And when pushed into shove, the Fed will just be there. I think they're trying to chip away at that slowly, but they also have, as we mentioned, like this geopolitical prerogative, which is like, cannot let the treasury market break. Like when the treasury market breaks,”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, this is the multi-trillion dollar question, which is like how does the tightening path, what is the terminal rate, right? And what are the inputs to that Fed reaction function? And then what does that mean for overall sort of asset valuations? Again, I'm not a trader. So, you know, I don't have like a whole lot of skin in that particular game. But I would say mechanically, the objective that seems to be, at least in the back of Powell's mind, is to try to take the air out of some of these like securitization Ponzis and asset-backed security schemes that have sort of popped up in an era of ZERP, where the Fed put provides essentially a guarantee to the mezzanine and all of these complex funding transactions that Wall Street's been able to basically manufacture safety off of the implicit Fed put.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“complicated and much more kind of inextricable with the degree to which sort of Western economies and the Chinese economy are like they're tied at the hip at the same time that like at the political layer there's this like drive to decouple and pull and those are those are opposing forces one force being driven by you know the security stakeholders like the intelligence the military and the political officials and the other is sort of the economic officials the economic interest so wall street silicon valley the equivalent in japan who don't want to go into that decoupling direction and that is what we're seeing right now is this sort of game of sort of political economy test of power right who has more relative power in this era do the geopolitical and military and security prerogatives overweigh the economic and kind of capital interests and yeah we've seen this play out in different historical periods of time where during peacetime the economy and capital usually runs it's when the bombs start forming”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“But that is really revealing sort of historical episode of just where Japan ranks in sort of the geoeconomic pecking order in terms of like, okay, when push comes to shove and we need you to like play on one team, this is what's going to happen. This is where these dynamics come into play. It's not just the monetary stuff in a vacuum, right? Especially when the strategic competition and the geopolitical rivalry is starting to heat up. The last point in Japan is like, we don't have any direct Japanese clients, but we've had some conversations. And it's interesting, like Japan business is heavily invested in China. Japan money center banks have made massive loans to China. So like economically, there's a really tight dependency in coupling between the Japanese economy and the Chinese economy. And this is, I think, a similar dynamic you see play out. It's different, very different from Russia, which is like there wasn't a whole lot of direct economic coupling. There was like energy coupling. And that obviously has been the major issue with that conflict. But it's much more.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“So a few days later, because they were caught kind of black, but they were like, they basically were like kind of told you're going to do this, right? Right. And they were like, oh, we need a few days to actually figure out how we're going to do this because we didn't think this was going to happen because that's my riding situation.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“So, yeah, but this is where Japan matters for a lot, right? One is like all these dimensions, like semiconductor export controls, defense modernization, and strategic kind of conflict scenario planning, overall kind of economic sanction strategies, not only against China, but like they were critical to the sanctions against Russia. So Russia, when we sanctioned their reserves, there was a blocking sanction put against the Russian Central Banks G7 fiat reserves. It wasn't just dollars. It was all the G7, including Japan. Yeah. And Yen is a major reserve currency held by the Russians as part of their overall portfolio. And those deposits were held at the Bank of Japan. The euro deposits were held at Bundesbank, essentially in an account custodian for the European Central Bank. So when we did those blocking sanctions, the Japanese government had to agree. And actually, they didn't sign on to that statement until like a few days later. So the Europeans were like pushing Yellen, we need to do this. And they said, okay, we're going to issue this statement on like a Sunday. But the Japanese didn't sign up.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“Who are then allowing other folks to short sell it? And that creates the feedback Japan has to buy it again. So they're buying it multiple times. And that's not a great place.”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT
“academic and he was so nobody knows what he's going to do because he honestly he was like kind of surprised I think everyone's kind of surprised that this guy was picked the real action is going to be his like number two guy who again I don't remember the name Ueda I think who's been like the technician who's been executing these monetary policy kind of experiments for the past number of years and this is the guy who's like almost like a day trade right like to run the run the bank of Japan's monetary operations you actually have to like do daily like almost open market operations and there's certain parts of the 10 years to your point like they own because every part every different there's like different like issues right and certain issues have more liquidity than others the banking japan is like selectively trying to do these purchase and repo operations to keep things from totally freezing out even though they own sometimes more than 100 of the total issuance in a particular tenor and so they're buying everything up and then they're relending it to the market”
2023-03-22 · We Study Billionaires · BTC122: The US Treasury May Need Private Stable Coins w/ Matthew Pines (Bitcoin Podcast) · IDENTIFIED FROM THE TRANSCRIPT