Ethnic Niches and Economic Dynamics

Join Malcolm and Simone as they dive into the fascinating concept of 'Non-Linear Ethnic Niches' and their dominance in various industries, from grocery stores in Detroit to Dunkin Donuts in Chicago and Vietnamese nail salons. They discuss examples from Arc Ethereum's research, the historical and economic implications, and even ponder whether such niches can be engineered ethically for future techno-feudal societies. Alongside, they explore the significance of such niches, historical parallels, and how they could play a role in a post-globalized world driven by AI and demographic shifts.

[00:00:00]

Simone Collins: Hello, Malcolm. I'm so excited to be talking with you today, especially because I just learned about this thing. It's really weird. From Arc Ethereum. He, he writes, did you know that Chian own 90% of the grocery stores in Detroit? 40% of the truck drivers in California are Sikh, and about a third. US Sikhs are truck drivers and that 95% of Dunkin Donut stores in Chicago in the Midwest are owned by Indians, mostly Gujarati Patels. What?

வணக்கம் உங்கள் அலுவலகத்தின் நேரத்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின் முதல்தின்

முதல்தின் முதல்தின் முதல்தின் முதல்தின் ம

Simone Collins: And then in New England and New York, 60% of Dunkin Donuts are operated by Portuguese immigrants.

90% of the liquor stores in Baltimore are owned by Koreans. And all of these are apparently what ARC Ethereum calls and other people, other people's [00:01:00] had called non-linear ethnic niches. And it like, these are these weird industries. That are dominated by ethnic groups, but not like, because obviously those ethnic groups should dominate them.

No,

Malcolm Collins: I think it is obvious. I think that they were just bred, I think Indians are bred to run convenience stores. This is, it's an entire country breeding experiment to create the perfect convenience store owner. I'm gonna put like an APU thing here.

Simone Collins: Well, no liquor stores and Koreans. There are more like Cambodian donut shops.

Why Cambodians and Donuts? No. There is no, and like by the way, in, in all the research on non-linear ethnic niches, they remove all the ones that should be considered obvious, like Chinese people and like Chinese restaurants. 'cause obviously like Dove, of course they would maybe dominate that. Although I feel like.

Actually they don't. So you might, right, like, aren't Chinese restaurants mostly like Korean run or something? They're mostly

Malcolm Collins: run by Koreans. Yeah. Or Mexicans. I feel like I've seen more Mexicans running No, no, no. It's mostly Koreans because white [00:02:00] people can't tell the difference. And so they're like, oh yeah, this makes sense.

It just seems authentic.

Simone Collins: Yeah. But no, they, they've actually parsed this out and here's the thing. Okay. Ethereum who introduced me to this concept, and we've done some podcasts and other essays he's written, he, he's, he's fun in that he is spicy takes, we don't necessarily agree with all of them, but they're quite interesting.

He thinks they're terrible and I think they're freaking awesome. Okay. Okay. Go explain, explain the regression of everything that we've ever done is society, and I'm like, this is. Exactly what we need right now. You,

Malcolm Collins: you wanna create some sort of like, ethnic carve out for my, our family and people. I

Simone Collins: want to make a non-linear ethnic niche.

I want to engineer one. And so what I wanna do with this episode is I wanna walk you through mm-hmm. Some of the examples here that Ark Ethereum describes. 'cause it's one, this is just super interesting. I, I, I like, I guess we've, we've kind of seen it, but I never really thought about it. Because, you know, I don't see race, Malcolm.

Malcolm Collins: I don't, I don't know. I

Simone Collins: didn't know Of course not. Of course not. Yeah. I

Malcolm Collins: only, I only see race. That is the [00:03:00] only thing I use to judge people is just race.

Simone Collins: Just like Jack, Jack Donkey just sees numbers on top of people's head.

If everyone could see the world the way I see it, it would be a better place to live. I bet that's true, Tracy, but , I guess I just see the world the way I see it.

Is he letting me keep this? I think so. I wish I was there so I could play with it. Hi Miss Levin.

Simone Collins: You just see like I. They're, they're race. Have you played ethno, guesser? This is a little off topic, but

Malcolm Collins: No.

What, what is ethno? Guesser. Oh

Simone Collins: god. We shouldn't go into it too much. No, tell me. It's a game. No, you like it's this new game where you see men and women, I think composite faces, and you're supposed to like, choose. Zi would

Malcolm Collins: be really good at this. He can like, no,

Simone Collins: he's like, he, yeah, no, he, he obviously is gonna be like the world class ethno guesser winner.[00:04:00]

But like now everyone can try to become like Zi Kahan get better at judging people's ethnicities upon sight. Yeah. He's, he is, he is insanely good at, I don't know how he does it. But anyway, now you can become good at that too, through the game. Ethno, guesser. But anyway yeah, I don't see the world like that.

I just see, I just see like. The number of actions that I might need to complete to end an interaction with someone and get away. I think that's probably how I see the world anyway, though. I wanna walk you through some of his examples. Then. I wanna walk, walk you through the, the unifying elements, like how these form I.

Because what these, we, these niches are, are essentially like industries that come to be owned by a group of people that thereby create high barriers to entry and have a distinct advantage in an industry. And while ARC Ethereum thinks these are awful in a post demographic collapse post AI world where we end up with techno feudalism, this could be the thing that saves your people.

You know what I mean? Like you want to own an industry. [00:05:00] Yeah. And he's just assuming that we're going to like, continue with globalism, that we're gonna continue with open markets and I don't think we can. Depend on that. So I'm like, alright. I mean, he's like, oh, it's like this horrible cast system. And I'm like, I mean, yeah, but if the shoe fits, wear it right.

Like this is what we're headed towards. Well, you, you have four ethno cast systems. No, I'm not for it, but like, if that's what we're headed to, wouldn't you rather make sure you're in a good group?

Malcolm Collins: Surely he has some hypothesis here.

Simone Collins: Okay. Yeah. So let's, let's let's just to, to quote him and why he thinks they're bad.

He says. Non-linear ethnic niches are harbinger of the reversal of centuries of social progress toward interpersonal cooperation and economic progress toward larger, more homogenous and better integrated markets. I don't know if I'd like homogenous markets but anyway, they are super interesting. So he quoted, and he didn't come up with this concept in a 1999 and New York Times article.

They are defined as a certain ethnic group becomes entrenched in a clearly identifiable [00:06:00] economic sector. Working at jobs for which it is no evident cultural, geographical, or even racial affinity again, like Cambodians and donut shops. He starts with this example that actually Albanians own cocaine smuggling in the uk.

Like it's an issue. Like why did they, you know, how did that happen? Okay. Yeah. I, he, he gave all the examples that I cited above, and then he goes into a couple of case studies which is interesting. He talks about Cambodian donut shops. Which is interesting. He talks about Patel motels and he also go

Malcolm Collins: into it.

What, what about them?

Simone Collins: Yeah. Okay. I, I can if you want to. It's, it's, it's, it's actually so interesting. He says Cambodians run about 80% of the donut shops in Southern California. Cambodians, just to give you perspective, are 0.17% of the population in California. Wow. 80% of donut shops. Right. Okay. Yes.

This is, don't, like, so he sees that and he's like, oh, end of society, and I'm like. Okay, how do I get that percentage? What next? What next? Keep going. The Cambodian donut Empire got its [00:07:00] start with refugee Ted Goy, who first learned the trade thanks to an affirmative action program to increase minority hiring at wind shell's, donuts.

The Cambodians were able to totally dominate this traditional American culinary sector through a mix of extended family credit and the use of dong tines, an informal lending club. So basically he explains it like, because they gave each other cheap credit and were sort of like in with each other.

They were able to take over this industry. Now, Patel Motels, Gujaratis mostly with a surname, Patel run an estimated 42% of hotels and motels in the United States. I just like that is so mind blowing. This is a huge industry.

Malcolm Collins: 42%

Simone Collins: are run 40 by tis.

Malcolm Collins: What are Borates? This is some like Indian, I think

Simone Collins: tis are a, a subset of the Indian population.

Let's look it up.

Gujarat is a state of India, so it's like St. Californians, I guess, you know.

Malcolm Collins: Okay, great.

Simone Collins: Yeah. Just again, for like perspective, Gujaratis are about 0.3% of the US population are write 40% of the hotels. Yeah. [00:08:00] 42% of hotels, 0.3% of the US population. And he writes, and this number was much lower back in 1999 when this phenomenon was first noticed, this rises to 80 to 90%.

Of motels in small town America, the Patel Motel Cartel. Oh sweet, sweet Art Ethereum. I love that. Got its start with an illegal immigrant con. KBA decide in the 1940s, so this goes way back. The initial attraction to Patels was that motel ownership did not require English proficiency as is with the Cambodians Patel motel owners were able to use informal ethnic loan networks and immigrant family labor, brought in via family reunification from India to undercut their American competitors.

Hmm. See this? This is something I can play with. And now Patels, she in labor, we can do that too. Uh uh Yeah. And we're gonna go through it. I have a whole plan. All right, we're, we're good here. Okay, great. F**k, they Patels now totally dominate the hospitality industry in the US outside of being chains Patel Rights.

So now let's go to Vietnamese nail [00:09:00] salons which are, are such a thing. Apparently over half of the nail salons in the United States are Ethereum rights are run by Vietnamese, which rises to more than 80% in California. Whereas Vietnamese people are 0.7% of the US population.

As soon as I walk in, they greet me right away. Hi honey. What you need today?

Oh, um, can I get my nails done? Okay, honey, do you lie pedicure too? Uh,

Simone Collins: again, like this is just so mouthwatering like a, as people who've worked in private equity and vc, this concept of like that kind of level of market domination.

Yeah, mind blowing, mind blowing, like no one would ever even like propose that like, I could take over this much of the market, but you can with the right, with the right tools. Just like the Patels and the Cambodians Athere Emirates, Vietnamese immigrants were able to finance nail salons more easily than American competitors because they had access to below market credit from family and friends.

[00:10:00] Pro-immigration conservatives often celebrate the small business ownership characteristics of non-linear ethnic niches as a route to simulation. But that's backwards. As with the Patels, Vietnamese refugees were attracted to nail salons because they didn't require English proficiency. In fact, this enabled ethnic separation from America.

And I, I see his point here like that kinda sucks. He also points out though later in his essay that this phenomenon actually diffuses a couple generations in. So this mostly is, is kind of stuck to first generation immigrants. And then once these people have kids. The kids don't wanna do it anymore.

And I think that that's, you know, so like his arguments around assimilation, I'm not too concerned about,

Malcolm Collins: well it appears to me to be, because they are running these companies in ways that is strictly worse as a lifestyle than just getting a normal job. Yeah. And this is you know, I, you know, obviously Simone and I work with a lot of immigrant families.

We've worked in other countries a lot. Japan, Korea, Peru and. You know, so I've talked with particularly [00:11:00] Korean immigrants who went into these types of industries, like the restaurant industry. And what they said is they're like, look, it's not like it's a better job to be running a restaurant. It's actually pretty risky.

It's rough. It's pretty long hours Bad lifestyle. Yeah, it's pretty tough. They're like, but because of my language skills. I couldn't get hired at any English speaking restaurant. Just hired. Yeah. Like, who else is gonna hire me? Yeah. I couldn't hire or, or gimme

Simone Collins: autonomy and here's what, yeah. And they're

Malcolm Collins: like, well, and they're like, well, no, no, no.

A lot of them, they came in and they were like doctors and stuff, and they're like, I couldn't get hired because of my language skills as a doctor. So what I had to do was start my own company. Yeah. And I knew a lot of people in this industry, so I started in this industry.

Simone Collins: Well, and so what, what arc Ethereum points out happens here is what the, the characteristics of the niches entered is.

They are low prestige but they offer high social mobility so no one else wants to take them on. And they have typically like sort of a [00:12:00] cap to market size. Like you can't get too big in them. So like big investors aren't throwing in money. Because kind of like you see with like mail salons, motels, donut shops, like yeah, you're, it's, it's really hard to grow super big in that unless you have a big chain and you need tons of financing.

So they go in. But it still enables them, you know, if you work at a restaurant and you're not, it's like renting, you know, you're not putting equity into anything. If you own the restaurant, you'll get that equity over time. So that's those three characteristics. Smallish market, very not, not romantic, not, not ideal, like no one wants to work there.

And still it offers upward mobility. So here's the, the, I I tried to make a list going through various cases and observations that he threw in because he has a lot of citations in this. I do recommend reading his article, his subject article on this subject. But here's why they form one labor arbitrage from first generation immigrants.

Where they sort of access lower cost labor from abroad is big. 'cause they're able to hire, like, you know, we have to hire people [00:13:00] who speak fluent English in addition to Spanish. Right. They just need to hire someone who speaks Vietnamese or Cambodian or whatever. Right? Yeah. Also first gener generation immigrants are willing to do higher hard work.

That's second gens and native borns just. Aren't. So you're also able to hire people who are genuinely hungry. And I think especially so when you look at all these bougie people going into food service and making like, crumble cookie or like all this like I worked in food service at a, a cupcake shop owned by two wealthy Canadian women, and they just hired a bunch of like entitled university students and.

It was, it, you know, the turnover was really high. The students didn't work that hard. They didn't do a very good job. Like, it's, it, I think when you, when you hire native foreign Americans or even. Yeah. Like they, you're just not gonna get that quality of labor and like immigrants are hungry, especially if they don't have other options.

The, then the micro loan, micro loans, like he kept pointing out like all of these, these groups were basically providing below market credit and loans and liquidity that you just [00:14:00] wouldn't get from a bank, even like an SBA loan. And so. There's something about the access to capital here that's really giving these businesses a leg up when other people try to enter Well, what it's

Malcolm Collins: is access to capital within, in industries that these traditional capital sources aren't willing to invest.

Yeah. Yeah. You're like untouchable. Get a bank loan to start like a nail salon. You're gonna struggle to get a bank loan to start, you know, a motel in a small town America. 'cause they're gonna be like, where's the demand? How would I, you know, where are the, the, the assets that are gonna continue to have value?

Simone Collins: And yet the people within the industry are, are really well positioned to determine if someone's worthy of a loan because you get, you know, personal references like their cousin who grew up with them also, like you understand the industry because you're in it, so you know it. And so, I mean, there's really something very smart about understanding an industry and you being the one to provide the financing.

Because we've, we've gone through the process of having banks due due diligence on us to loan money to our businesses, and they like just totally don't understand the business and their key bets on [00:15:00] our loan payback. Are based on the stupidest things, and they think that it's like smart and they're like, oh good.

Like based on our calculations, everything's gonna be okay. And we're like, yeah, yeah, you think that like you really should be looking at this thing over here and you're not. And that's incredibly dumb, but we're not gonna say anything. So I think it's really smart. Then there's of course like even more informal things like equipment loans and access.

Like, you know, if you all own seven elevens and someone's slushy machine breaks, like you could, you know, it, they, they, he quoted someone in his article about how like. You can just get, you know, a, a solution really quickly. If you need a machine fixed, you get the machine fixed, you know, you're not depending.

It very much like the whole issue of the atomization of the family. Where now you have to like pay a babysitter and like find you know, find someone, you pay someone to do everything and they're not necessarily motivated to help you. And they're like, ah, I don't know. Like I don't feel like it's, yeah, I can't come out.

Like you have people who will be there for you because they're your cousin or they're your uncle, or they know that they need your help too. And so it really is a community and that kind of corporate family way that also we [00:16:00] really appreciate, speaking of corporate family, you also get informal employment.

Now sometimes this is like. Very not, okay. Not legal, employment, legal, immigrant. It

Malcolm Collins: sounds like what it is is it's a few people somewhat profiting off of a lot of people working in the types of jobs that wouldn't, you wouldn't legally have in America. Yeah. Or

Simone Collins: like, like literally they're undocumented, illegal immigrants.

Kind of doing indentured servitude slash slave labor for you. Like that's, that, that's the bad end of it. But then the, the better end of it is, is family labor where like, you know, your kids are helping out, et cetera. And like, to a certain extent, this can lead to some like tax avoidance or wage minimizing.

So that's, that's big. It, you know, it enables you to be very lean in terms of your costs while also really supporting an extended family. Plus in terms of of team members, you have much easier vetting of good match employees. Like you have family references, people vouching for others, and we know this.

From a firsthand standpoint because [00:17:00] we've, we've seen the value in hiring siblings and cousins of our existing employees when they get referred, like they just work so much harder and trust, like we go through the normal vetting process. We do open hiring. We, we put ads in papers. We put ads on Indeed and on LinkedIn, and we interview hundreds of people.

And we hire across the board the most qualified people, but the people who have stayed and who have done the best and performed the best fricking family.

Malcolm Collins: Yeah, because there's the dual thing of like, yeah, yeah. We, we leaned into just h hiring through family networks. It's, it's amazing. It's, it's, it's one of the best

Simone Collins: source of referrals because there's, there's two elements of it.

One, you have the pressure of the person who referred them, who's like, don't screw up. This is my reputation and my job. And then the other person who's like. Wow, I can't screw up. You know, like there's, there's, there are reasons. 'cause I think right now, oh, are we

Malcolm Collins: participating in this right now? Do we only hire through, through Latin?

You see, the thing is like, I'm like, oh yeah, like

Simone Collins: this is great. We already, but we don't do the whole, you know, informal labor thing. And then, you know, the, there are, I then barriers to [00:18:00] entry, which are created by all this, right? Like if you are trying to enter the nail salon business in California. You know, it's, I, I think it could be kind of tough when it's kind of dominated by all these other people.

In fact, some nail like cosmetology schools that, that certify people for this, that what you need to do, to do nails, whatever that is. Teach their classes in Vietnamese, like they've just given up on English. I'm like, screw that. That is

Malcolm Collins: hilarious.

Simone Collins: Yeah. So the, and, and it's this. So just in general then, so there are lower transaction costs around the board, you know, getting things fixed, getting equipment getting getting employees, getting financing.

And we've seen this with other friends. Like one of your friends who started kind of restaurant store business. I think leveraged family a ton. For that. Yeah. His family worked at the business. His family manned the stores, his family helped with sourcing equipment, et cetera. Like that's huge. And I think, you know.

Malcolm Collins: But what's funny is it [00:19:00] was one of those cases of his family was all Peruvian and the business that he was specializing in was like Jamaican style food.

Simone Collins: I know. I mean, but not linear. Oh, I don't know. I mean, I, it, it's just so cool. But. Ah, but, Hmm. No, no, no, no. Not cool Malcolm, because a Ethereum says, so when Art Ethereum

Malcolm Collins: says, so what, what, what?

What's the complaint here? Why? Why is it bad? Says

Simone Collins: once a niche is taken over, outsiders can no longer compete within it. Which I'm like, yeah, that sounds great. Like from an investor standpoint, that's what, that's when we have to raise money for something. Investors always ask like. Well, are there barriers to entry?

Like what's, how, how defensible are you? Like this is, this is the dream okay that he says non-linear ethnic niches exist on and are able to sustain themselves in the face of market competition. This might hurt some Americans, but so do a million other problems. Does it really matter? Yes. Western Civilization has been different for so long, more than 700 years that we've forgotten what this looks like.

But non-linear [00:20:00] ethnic niches are a throwback to pre-modern forms of social organization with all that implies. And he, so he's like, this is the worst progression. Okay, I should

Malcolm Collins: disagree with him here. If you look at ancient Rome, it was well known that certain industries were dominated by specific ethnic groups.

If you look even at. For example pre Nazi Germany, we know that certain markets were dominated by Jews, like I mentioned, like pediatricians. They were, and orthodontists they were. Yeah. So the idea of ethno from like specialized careers is actually like continuous strain from modern western countries to, if you go back to the co colonial period, you will see specific.

Ethnic groups dominating particular niches as we've no mentioned before. By the way, much to their chagrin, the Quakers in dominating the slave trade. Quakers were, I love it, the Quakers slave, Quaker anti-slavery, and I'm like, well, I can look at Quaker wills. And 45% of Quakers own [00:21:00] slaves compared to like at the height of the deep south, it was like 22, 20 3%.

To be honest, I'm a little surprised that he doesn't appear to know that there have always been non-linear, ethnically controlled, , industries. If we look at early America, we can, for example, look at, , in colonial America, particularly in Pennsylvania, German immigrants played a significant role in certain industries.

For example, in Germantown, now part of Philadelphia, Germans were heavily involved in paper making with William Rittenhouse building the first. Mill in the British colonies in 1690. They also dominated printing with Christopher Sawyer and his son establishing a major press in 1738, printing America's first European language Bible in 1743.

Additionally, German immigrants were known for their craftsmanship in weaving, tanning and wagon building, , reflecting their cultural emphasis on skilled trades. Now if you go for other periods, you can look at ancient Rome. , In ancient Rome, the medical profession was notably dominated by Greek physicians.

, So was the tutoring industry, , starting with. Essis of Sparta [00:22:00] around 218 bc. Greek doctors like Galen ocs and soreness of Ephesus brought advanced medical knowledge to Rome. Their influence was due to the advanced state of Greek medicine, which Romans valued, leading to reliance on Greek expertise for both public and private medical care.

, Greeks also dominated the theater industries.

No, no, no. It says

Simone Collins: arc theory of non-linear ethnic niches are slowly dragging western society back into the default human world of tribes, clans, extended families and middlemen. Minorities we escaped 700 years ago. So he. He basically thinks that they undermine individualism and that nuclear families support individualism, which, I mean, just the fact that he is putting nuclear families on a pedestal, of course is like a, a trigger for us.

Right.

Malcolm Collins: Dumb like nuclear families, as we've mentioned before, they only really started as a thing in like the 1920s and they basically stopped being a thing in the 1970s. So, but get

Simone Collins: this, he actually seems to be, and I'll, I'll quote him on this, like, he seems to be. [00:23:00] Actually pedestal and thinking that the atomization of the family was a good thing.

And like here, like here's what he actually says. He says, by breaking extended kin based structures into nuclear families. So by breaking up the corporate family, this is what he is saying. All right. The Western European marriage pattern facilitated interpersonal cooperation based on the task at hand rather than kinship.

Again, what Atomization, go buy it from a store. Go get it from a babysitter. Go, you know, put your grandma on at home. This is

Malcolm Collins: a really bad take.

Simone Collins: I know, I know. This is so fun though. LA rather than kinship Instead, which both enabled cooperation at much larger scales and greatly improved the efficiency of learning.

See. See, he's like gone. He's like drank the Kool-Aid. He thinks atomization is good. He's

Malcolm Collins: completely urban. Monoculture to,

Simone Collins: and this is the thing he's known. This is our Ian. This is the one who is like, you know how to solve demographic collapses. You disempower women,

Malcolm Collins: right? But now he is like, you know how to solve all these problems.

We need to split up the family unit. As we've pointed [00:24:00] out, I know fertility rates started falling. It was not when the woman left the household. It was the man left the household uhhuh. That was the beginning of the nuclear family. The concept that the man would leave the wife and the kids at home and go out and earn wage labor, yeah, that is when fertility rates started falling.

That is the core toxin that we are dealing with as a society is the atomization that he is talking about. All of the problems we have today are downstream. Of that it is these extended family networks and specialization. Mm-hmm. That made our ancestors great.

Simone Collins: No, but get the, get get this though. This is where it gets even crazier.

'cause this just seems so antithetical to like the space in which arc Ethereum is moving. Yeah. But he literally. With this quote is arguing for the urban monoculture and for homogenization of culture. He writes, genetic and familiarly transmitted cultural adaptations do not diffuse from endogenous, endogenous, sorry, endogenous ethnic groups into the broader [00:25:00] population.

Market dominant and middlemen. Minorities are thus problematic for national development. He's basically saying because they don't integrate, they are not diffusing into the sludge. Of the urban mono. This

Malcolm Collins: is like objectively wrong, and we can see this in history. There is a famous case of one of the Ayatollahs one, one of the Spanish emperors at one point was, was during one of these periods where they kicked out the Jews.

Oh. And one of the, the Ayatollahs said the a, a. A letter. I was gonna say an email, but a letter. There was basically a mocking. Have fun being poor. Thanks for all the Jews. Okay. And that's what happened. Spain did suffer economically after this. The duh. Yeah. You know, you, you don't kick out a group that is uniquely good at something.

These groups provide these goods at lower cost. That is why they have been successful, right?

Simone Collins: Yeah. Like, yeah. Yeah,

Malcolm Collins: I don't, I don't wanna pay some, you know, [00:26:00] dilettantish, neoliberal educated white woman to do my damn nails. Alright. That's what the Vietnamese are for. Oh boy.

Simone Collins: Well, so there are some criticisms that he brings up and I'm like, I hear you.

But also like, this doesn't have to be. Ma retained in new non-linear ethnic niches. So he points the very large example of India it when he talks about how they encourage discrimination how entire swaths of the population aren't even given consideration. He writes in a way, India's unique social structures keep pre-industrial economy, even within modern technology with cottage industries dominating factories.

He, he cites, for example, that like studies have found that people would be like. Just pay to not do anything that would put them in proximity with different casts. And, and that India is sort, sort of one of these places that continues to force this sort of caste system that he associates with non-linear ethnic niches.

But let me, let me walk through weather. They're actually awesome. And, and specifically I alluded to it before, free market competition is going to [00:27:00] go hawar with the rise of AI and Yeah. As demographic labs plays out, so like this whole, the whole underpinning of of his argument here is like, well, we all do better when there's globalization and free trade and markets at scale.

But he's just assuming that that's somehow going to continue to be facilitated. But as governments falter and fall apart, as demographic, direct collapse plays out and become more isolationist, and as AI plays out and disrupts the way that businesses and markets work, leaving a huge number of workers unoccupied, we will not have that world anymore as, as cool as it was while it lasted in many ways, though it wasn't cool in all ways.

It's just not gonna last. So my whole thing is. We're gonna lose this. Mm-hmm. And here's this weird like molecule of, of human configuration. The non-linear ethnic niche that actually has a lot of defensibility and advantages. How can we replicate this to our advantage? And I, I really think. [00:28:00] We can't, one, because he points out in two of his case studies that these cartels started with just one person.

The Cambodian donut empire got its start with the refugee Ted.

There are some who call me Tim.

Simone Collins: And that the Patel Motel Ted got, its, its, its start with an illegal immigrant Mr. Desai. So. Here's what we need to do and, and here's what I'd say we do differently. Here's so to replicate, like the good stuff I would keep is focus on a small industry.

I'm gonna say niche biotech, right? Let's, yeah. Yes. Let's modify some humans here. Focus on an industry that other people don't want to be in due to what, in this case, not because it's unromantic, but because they think it's like, it's not low prestige, it's anti prestige, right? People are like ethical considerations and it's abominations and it's like, right, so like.

Us going into that niche, I would specifically say is great. But I mean, if I were encouraging other people to look at this, find something other people don't wanna enter that's kind of small. [00:29:00] But I think niche biotech for us would be amazing. Cheap credit. And you know how we talked about with the index that we would have, like

Malcolm Collins: Simone, by the way, by the way, what you are suggesting here is that we become the Kaman Owens.

Very impressive.

We take great pride in our combat education and training programs. You mentioned growth, acceleration. Oh, yes. It's essential. Otherwise, a mature clone would take a lifetime to grow.

Malcolm Collins: Yes. From, from Star Wars. By the way, the Kaman Owens are the species that they go to to clone all the soldiers that live on like the water world.

Simone Collins: Yeah.

Malcolm Collins: You, you're like, just be the Caman Owens. Okay, great. Continue.

Simone Collins: Non-linear ethnic niche. I mean, also they kind of, they look nonlinear. They look ethnically, like somehow they have an advantage in that.

I don't know, like maybe they are just. Somehow, although all the Kevin

Malcolm Collins: ones are clones.

Simone Collins: Oh, well, yeah. So then maybe they're not a non-linear may, they're, maybe they're just an ethnic niche. But anyway, cheap credit, like we would provide, we would create, 'cause we plan to, like later in life, once our kids are [00:30:00] all in order, we're gonna really get the index in order, find a way to like pool a lot of money in it.

And then that money will be lent out, like low, low cost financing to businesses that are then part of the index within

Malcolm Collins: the techno puritan network.

Simone Collins: Either techno, puritanism, or the index. Yeah. Or maybe they're gonna be the same thing. I'm not really sure. Yeah. But also fast tracked hiring. So if you're in the index or if you're in the techno purin network, like.

You, we understand those values are aligned and also probably is going to select for skill sets that are quite useful. So already you have that fast tracked hiring values aligned employees, right? Because if you're in the index or if you're a teop Puritan, like we know that you care about pluralism, you care about long-term human flourishing, like you're, you're gonna be into also this kind of biotechs, accelerationism stuff.

And then family involvement. I want our kids to work in this. I want our kids to, you know, be involved in that low cost apprenticeship. Has for thousands of years been how one, like people who are very junior get their training and their career started. But [00:31:00] two, how business owners gain access to very affordable labor.

Because half the time you were indentured, I think even during colonial times in the United States, you literally signed an indenture to your, let's see if you're the apprentice, what's the boss called? And anyway, you were dentured to them basically, and it was very low cost labor, but it was, it was a, it was a worthwhile exchange because you were getting training, often housing and food as well.

Here's what I wanna make it different. I wanna make it cultural and not ethnic. And I think you can already see examples of this where it's a lot more inclusive. It's like an opt-in thing. It's not like, oh. You don't look the right way or you're not No. You're actually

Malcolm Collins: like, like Catholics into the legal profession.

I was

Simone Collins: gonna say, yeah, like look at the Catholic church. This is a very diverse, like people from all walks of life, all backgrounds, all countries, all races, all ethnicities. I. And, and they're all opted in. They're all very ideologically aligned. The LDS have gone kind of halfway there also with like, temple [00:32:00] recommends cards.

Like there's a little bit of this like inside network.

Malcolm Collins: So well LDS applicants are also significantly discriminated against within normal jobs. Yeah. Yeah. So there's also on BYU versus other equivalent schools, and there's basically is like a blacklist for hiring, which I don't understand. Like I,

Simone Collins: yeah.

What's with the, that takes back to that polling you'd found where like. The LVS, I mean, I would be really happy, everyone, everyone scared

Malcolm Collins: to work with like a Scientologist for example. Yeah. And be like,

Simone Collins: yeah,

Malcolm Collins: this is worrying. But like a Mormon, like, come on man.

Simone Collins: I know seriously like great hires. At least the CIA has figured that out.

A lot of government agencies are huge on hiring Mormons, so Yeah. They're just like, someone loves Mormons and it's the US. Government. But now the US government's firing everyone, so I don't know. So also I would, I would leverage labor arbitrage, not from refugee desperation, but from ideological alignment, just like the Catholic and church does.

Right. And I mean, to a certain extent the LDS does too. But like when you become a priest, when you enter the church in service, you're not making a lot of money. And they're, [00:33:00] they're definitely benefiting from your labor, but also you don't care because. One, they take care of you. And there's a lot of just, just mimetic alignment.

Like you're happy. So it's not a problem. I feel like it's, it's a lot less ethical what's happening with refugees. 'cause you're, you're just stuck. You don't have other options. You're trapped. I want opt-in, not opt out. Like, I mean, I want opt-in, not I. You're there 'cause you have no way to opt out. And I would also leverage apprentices and not refugees for low cost, but high training employees.

Like I would want our children to apprentice in this. And it's, I think it's just so much more valuable than like going to college. So also, like, you don't end up in permanent debt,

Malcolm Collins: so, and I don't think that you can study like real genetic science in college anymore because they're,

Simone Collins: no, not with ethics board, not with like.

This, this consensus that crispr, you know, gene editing and multiplex gene editing are like, oh, scary germline gene editing. Oh, God forbid. Yeah. So like exactly.

Malcolm Collins: We, we will create the, the hominoid, the rise of the [00:34:00] hominoid. Well, that's the

Simone Collins: other thing is, another thing I'd wanna do differently is obviously what exists with non-linear ethnic niches now, because they are actually ethnic in nature, is they'll look a certain way.

I would like, I wanna bring everyone in, but also like, because we're biotech, it'd be like really cool if like you enter, but like, you know, 80% of the people who enter opt in to have like their eyes turned purple. You know what I mean? Yeah. Like their irises. Oh. Like, oh, you know, you know that they're part of the biotech cartel.

'cause they have lavender. Which would be really cool. Something like that. You know, like you, you could tell you're immediately Oh,

Malcolm Collins: they're different. Yeah. Like, yeah, it

Simone Collins: becomes ethnic, but it's also a feature like you're showing off your wares. You know, or that like your heartbeat shows up as a tattoo on like your cheek, you know, all sorts of crazy things or something.

Right. And I would also wanna, one thing that I didn't really get into, which he does bring up, is a legitimate concern in his article is that most of these ethnic niches, they, they, they compete and they build barriers to entry just by [00:35:00] being very. Low cost. Mm-hmm. And like undercutting costs for everyone else, sort of making it just too hard for anyone else to compete.

But in turn they're also pretty conservative and not innovative, and they're not also, like, there's not a lot of competition and variance, which of course is antithetical to innovation. And I, I agree. That's bad. Like I, I'm with ARC Ethereum on that, so I'd wanna create incentives that encourage competition.

And I think it's really easy to do that especially based on like how we would provide more funding and, and how also the index is designed to encourage in intercultural competition and remixing. And also just to, to be very clear, I would want it to be inclusive. Anyone should be able to opt in if they're ideologically aligned.

And again, like I just, and better

Malcolm Collins: than other people,

Simone Collins: like we are going to end up in a a, a. What do, what do we call it? Futile techno Futile world.

Malcolm Collins: Techno futile world. Yeah. Yeah. That's what we're heading into. So

Simone Collins: like, you, you need to sink or swim here. You know, like, I love this idea [00:36:00] that like, globalism will last forever, but it, we are headed toward and you don't

Malcolm Collins: love it.

Come on. Do you really love it or are you just like,

Simone Collins: I don't know. I don't know. I, there were things about it that I love. And there are, there are things about it that aren't so great but. Yeah, I mean, I, I think it doesn't matter whether I liked it or not, it's not going to last, like the signs point to it not lasting.

So we have to plan for something better. So is there anything else that you would try to replicate or do differently? No, I

Malcolm Collins: love everything you're saying here. I want to play it out. Let's do it. Okay. Let's cut the rest of the world. I mean, I might add like two industries. I was gonna have two industries that I would really focus on.

Okay. It would be, the, the human genetic research Yeah. And augmentation.

Simone Collins: Yeah. And

Malcolm Collins: human AI integration or human computer integration like brain computer interface and stuff. Like, that's what I got my degree in. That's what I started my career in.

Simone Collins: Yeah.

Malcolm Collins: Because I think those are the two areas where a lot of people are squeamish about Yeah.

You know, engaging. Yeah. And I think that you know, [00:37:00] you can create a family that's just like a hundred percent all in, in this stuff. Mm-hmm. And you're gonna get, a lot of people and there are fields that are gonna exist in the future. You know, like Yeah. These are, these are persistent fields that are gonna have a persistent degree of societal squeamishness around them.

Simone Collins: Yeah. Well, and we've long dreamed of having a city state that's devoted to something like this. I just, I never thought about it as a cartel per se, and I had never thought about the fact that this has been done for thousands of years. Yeah. And that there are many examples of this. I. Already around the world.

I also didn't realize just how strong these non-linear ethnic niches are. I mean, what that, that, that Chaldean own 90% of grocery stores in Detroit. That's just, that's insane. And I Have you figured out who

Malcolm Collins: they are yet? The Chian? Yeah. Let's figure this out.

Simone Collins: That's what the internet is for. A, a modern Aramaic speaking Catholic Syria community, primarily from Northern [00:38:00] Iraq.

Hello? Specificity. Okay. Detroit grocery stores. Good for you guys. Good for you. But yeah, I mean, there's absolutely no reason why a modern AIC speaking Catholic Syria community, primarily from northern Iraq would be really good at grocery store management. But they are, apparently, they're

Malcolm Collins: really good at getting very inexpensive labor from northern Iraq.

Simone Collins: Yeah. Apparently.

Malcolm Collins: Anyway. I love you did ask Simon. It's just fascinating. Very interesting topic. I appreciate you prepping this episode, bringing this up. Fans can like and subscribe if you appreciate when Simone does an episode. Yes.

Simone Collins: Yes. Do you, do you like the. The dumb female speaking more, or is it very annoying?

ICI could imagine it grates on on many. But

Malcolm Collins: yeah, I mean, I can understand people not wanting the dumb female talking for, for what Worth? I'm joking by way. I'm joking. For what it's

Simone Collins: worth, the grist for the mill came from ARC Ethereum, who also is highly critical of the professional worth, [00:39:00] dumb female.

So I don't even know. I don't, I don't, I imagine he doesn't think women are dumb. He just thinks that they're toxic. For what it's worth. Yeah.

Malcolm Collins: Yeah. Don't, don't mischaracterize him, Simone. I know. I'm sorry. I

Simone Collins: love him. I love your Ethereum. I don't think you're watching this, but. You know, we've done like three episodes.

I mean, at this

Malcolm Collins: point we're pretty big. I wouldn't be, be surprised,

Simone Collins: I guess. Yeah. I'm, I'm just, I'm always surprised, even if like family's aware of what we're doing. I just, we live in our own little farmhouse world and I think, I just love thinking that, you know, we're out, like on, on the Prairie. Nobody already knows what we're doing in the wilderness.

Yeah. Just like do, do by the, I know you saw

Malcolm Collins: Simone, but Aria Babu, who's been on the show, just sent us a wedding invite. It's in the uk so I don't think we're gonna go but really cool that she's getting married. She needs to start pumping out those kids, right?

Simone Collins: Oh, oh, this is such a pretty, oh, it's so pretty.

Website. Oh, oh my god. What? Oh. [00:40:00] Ceremony, photos and fizz lunch. Speeches and cake. Oh, and this is a nice timeline. Ceremonies at noon, you're having cake by 4:00 PM. Do you understand? Like that's how you do it. The weddings we go to, like, we just wanna get the cake and get out there, but it's like 9:00 PM I'm so sad that I won't

Malcolm Collins: be going 'cause I like get invited to weddings so rarely.

Simone Collins: I know one of, I don't really

Malcolm Collins: invest in making friends because, you know, they're gross. I go to

Simone Collins: this though. This, this looks really nice. You

Malcolm Collins: wanna go? I mean, if you wanna go, I can make it happen. You know,

Simone Collins: I'm looking at the dates. I don't know. We don't have any money, especially from throwing it into a hole to save our investors.

Malcolm Collins: Are you really sure? That's a good idea, Simone. Like, listen,

Simone Collins: we'll let the, if the board has an aneurysm, then we won't, but I just wanna do well by everyone. I just want everyone to be happy.

Malcolm Collins: Yeah. [00:41:00] Well, and like I was saying,

Simone Collins: like, listen, you're like number two, Google search suggestion is Malcolm Collins billionaire.

If everyone, maybe don't put our

Malcolm Collins: kids at risk trying to make other people.

Simone Collins: But if everyone thinks you're super wealthy, you've like made it like that's, that's I think the only reason why Donald Trump kept, like trying to prove that he was wealthy. So they got on those lists. So if everyone thinks you're wealthy, is it, it's like one of those, like if a tree falls in a forest, if a man is Googled to be a billionaire.

Who's to know that he isn't, you know,

Malcolm Collins: I love you. All right, have a good one, Simone. I love you

Simone Collins: too. Okay. I'm. Yeah.

Malcolm Collins: Yeah. Blow it all on this, this loan.

Simone Collins: Well, come on. I'm Well, I'm sure you're glad to be talking about something other than me blowing our savings to protect our investors, but that's our way. It's your family's way. Who was the family member who lost their hand? A whole, like, hanging off a roof to avoid, have somebody interrupt him.

Actually,

Malcolm Collins: one of my, [00:42:00] my namesakes and lost. Yeah. That, that, that happened in the family and we are taught that the investors come first.

Simone Collins: Yeah. So, I don't know. I would rather lose our savings rather than our integrity, our hands. You know? I mean, losing our integrity with investors is a non-negotiable. You do not.

You do not wrong. People who, who placed a bet on you, you do not double cross. Or not even cross. You don't cross with double cross. Oh my God. Like, don't, don't even, you know what I mean? Right.

Do you like your blueberries? Mm-hmm. Yeah. They're the color of the ocean. They're the color of the ocean. Step and kick a mama's back. Step on a brat, a crack, and you break your momma's back. That Do you like your muffin titan? Yeah. Don't step on a or your break your mama's back. Okay. Well please guys, don't step on cracks, okay?

Okay. Okay. You're gonna be very careful about cracks, right. Yeah. [00:43:00] Yeah, because we.