All right Robert, I think last time we spoke, I started the conversation with a very simple question because it is the theme of your show, and it's actually something that has resonated with me because I think it is the most important question that people have to ask in order for them to really start their journey down the rabbit hole. I think this rabbit hole is endless. I think it continues. It just keeps going forever. And I think there is no certain answer to this question. I think it evolves over time. And the question I have for you is what is money? How has it changed from the last time I asked you this question? Yeah,

you're exactly right that you ask yourself the question, what is Bitcoin? The obvious answer to that is Bitcoin is money. It's really nothing else. But then you get into the question, well, what is money? And that's where the rabbit hole sort of opens up, I think for a lot of people. And it's funny because we obviously define this word money in terms of other words, but one of the themes that I've encountered again and again on this show and having talked to, I don't know, we've had like episode 470 at this point, so we've probably talked to over 350 guests. Some of them have been repeat guests. One of the themes that I've repeatedly encounter is the limitations of language itself, right? The capacity of words to represent reality fully. It's obviously the best tool we've got for mapping. It's a very complex world that we inhabit. But I think it's simultaneously... it's indispensable to human communication, obviously. Human rationality, cognition, all of our any activity. It's part of our internal dialogue, right? We use language internally, even in the conversation that is ourselves. And so it's indispensable to being human, but it also seems to be simultaneously insufficient. And the language can never capture the totality of reality. And in fact, when people do think that language can, or knowledge more generally can be totalized or totalizing, that you can capture all the complexities of reality and just propositional phrases, I think that is the hallmark of totalitarianism, right? That you actually, it's totalizing knowledge. It's the idea that you have the final solution, the final answer, the ultimate central plan that everyone just needs to follow. And this will solve all the world's problems and usher us into the utopia. And as we've seen time and time again historically, that tends to end up its opposite dystopian state. So trying to answer the question, what is money? I mean, I think one of the, maybe the deepest answers to it is that it's strange, right? Because when you ask a definition, right? Again, you're thinking about this word in terms of other words. And so this mechanism actually is something that's very essential to human cognition. And I would call this, based on where I'm at today, the mechanism of metaphor itself. They're actually thinking about one thing in terms of another thing. And so I'm writing a long piece about this, but when you really, a lot of this is based on the book, Metaphors We Live By. That's Lakoff and Johnson, I think are the authors of that. And then they've also written a book called, Where Mathematics Comes From, arguing that mathematics itself is a metaphorical construct. And so the general idea is that as human beings, all we really have is our raw experience of embodied physical engagement with physical reality. Like that is our primary substrate of experience. experience, we can abstract that up into cognitive space basically. So all it, several words are metaphorical, several phrases are metaphorical. So for instance, the word understand, right? It's like to stand beneath something to gain a deeper perspective on that thing. So you're mapping the physical experience of standing under something to get a deeper on its inner workings, right? Maybe you're under the hood of a car or you're actually laying under the car to see how it works and repair it, right? You're not necessarily standing in that case, but you're under it basically. And we're mapping that physical experience onto the cognitive experience of gaining a more intricate comprehension of something, right? You're understanding it in a more detailed way, basically. And so other words like, you know, so to understand something more deeply is to get closer to the substance of the thing, which is also to sub, below, stance, to stand. There's other words like, you know, supervision, which is like the vision up from above. So you're seeing something from multiple perspectives. Um, you know, and the, you know, so like, do you get my point? Right? Do you see what I'm saying? There's all these metaphorical phrases, words, and it's like our entire conceptual apparatus or rational apparatus is really constructed from metaphor, is the hypothesis of these individuals. And there's been a lot of work done on this since, and I think it's a pretty strong argument. So even the definition itself, right? What is money? Well, it's kind of metaphorical, right? You're thinking about one word in terms of other words. And then this gets you into kind of a circularity because well, each word that you use to define the word money also has a definition behind it made up of other words. And so if you follow that to its ultimate conclusion you end up in this circle of words. There's a strange thing you can sort of see this phenomenon in action if you go to Wikipedia and they say you click the first hyperlinked word in each entry and you just keep repeating that right so you open up anything in Wikipedia choose your favorite subject click the first hyperlinked word that will take you to another entry in Wikipedia that's what each hyperlinked word is to another for that term in Wikipedia. And you repeat that process. And in something like 97% of the cases, you end up in the philosophy page. Like it always grounds out in philosophy, because you have to you get to like the bottom of language. And it's like, how does language ground out into physical embodied existence. So I think, so this is something we're doing, like so what are we doing? We're taking something that we don't understand, and we're taking different aspects of it, and we're analogizing it or metaphorizing it in terms of something that we do understand to gain a deeper perspective on it, to understand it better. And so with money, I think it is one of the most powerful metaphorical systems we have. Obviously mathematics is this very universal language. I can't, again, I'm not, I can't speak to how and why that is a metaphorical system, but I would say check out that book, where mathematics comes from. There's a very sophisticated argument there. But the beauty of mathematics is that it is universalizable. Anything that is quantifiable basically can be categorized in terms of one, two, three, four, et cetera. So it's a universal language system or universal category system, if you will. Very useful for mapping and describing reality, right? To the point where we discover things in mathematics prior to observation, right? Einstein discovered in quotation marks, the existence of black holes, in mathematical abstract space, before we ever quote unquote observed one, we still can't have it technically observed it, we've just seen stars go around the core of a galaxy and they go so fast and they're going around one common center of gravity that we infer the existence of a black hole. You can't observe it because light doesn't escape obviously. But Einstein again mathematically Observed these I don't know if observed is the right term discovered black holes, you know 40 50 years prior to our physical observation of them So I would just based on the theory just based on mathematical and also, you

know Neptune also was discovered that way just via pure mathematics and And the reason I interrupted you is because I think that Bitcoin, there's a connection to mathematics, which you can make is the language of the universe, right? Yes. And the connection is via, I would say that proof of work anchors Bitcoin to the universe. It anchors Bitcoin to where we are in this life. And I would say that is a complete and utter contradiction, and the polar opposite to what fiat money represents, which is it brings all the flaws of humanity alongside it. It starts morally and ethically and then progressively over time it starts to degrade. And this only didn't just happen here in the United States, this happened in the Roman Empire as well. So it's a very kind of interesting phenomenon. Anyways, I want to interrupt your thoughts. Yeah.

So to finish the thought on money, right, is we, I think it's a metaphorical system because we are looking at the world, specifically the world of socioeconomic activity, right? So people in terms of their worth or particular goods, businesses, right? The example I like to give is, you know, if you're an entrepreneur and you run a business for an entire year, well, there's a great deal of complex action interaction, buying, selling, hiring, firing, planning, executing, right? There's all of this kind of maelstrom of human action, if you will, right? By both the entrepreneur, their employees, their vendors, et cetera, all these interconnections and relations. But at the end of the day, or the end of the year rather, we just compress all of that activity into this statement, right? It's a profit and loss statement, a balance sheet, a statement of cash flows. And so this is just a mathematical data compression via money, right? Are the financial statements only make sense in terms of money, obviously. And so then you get this highly compressed piece of data, this artifact that tells you a lot of what you need to know about all of that business activity. And then it makes it comparable over time. You can look at your profit and loss statement year to year. You can also look at it across businesses and you get this apples to apples comparisons among all of this apples to oranges activity that takes place in the actual world. But we compress it via money, via the metaphor of money into a mathematical statement that is comparable and relevant to the aims of the entrepreneur, right? You need to know if you're being profitable or not, because if you're not, well then eventually you're gonna consume all your resources and you're gonna be dead in the water, so to speak. So it's, in that sense it is a measuring tool. Like money doesn't measure value per se, but it is measuring inputs and outputs in that way. And so I think what we're doing with money to get, to bring this to the answer, like what is money is money is something like a tool that lets us metaphorize the complexities of human action in terms of mathematics. Something that's very, something that's very wet code as Nick Zaba would say, hard to measure, hard to quantify, et cetera, into something that's very dry code, right? It's very, very quantifiable, algorithmic, you know, you can perform operations on it, you can perform arithmetic, et cetera. And so that, we need that, right? We need to convert all of this kind of messy, fluid, complex reality that we're dealing with all the time into something that is linguistic and in a common language. So we can communicate, negotiate, execute trades, et cetera. All of this is necessary. And then there's feedback, right? Like the more clear your data is about yourself and your business, the more adequately you can make decisions in that messy business process that guide you towards desired outcomes, right? Profitability, business growth, acquisitions, hiring, firing, whatever it may be. And then all that activity feeds back into the financial statements. And this seems to be kind of the feedback loop of human rationality that we have, you know, our ideas about how the thing works. And then there's how the thing actually works. And both inform one another. And so in the same way that language is this metaphorical system for, you know, de -complexifying mapping the world, if you will, but it can never contain the whole thing, right? The map cannot be the territory. If the map contained every detail of the territory would no longer be the map. It would be the territory. And so you need to be able to kind of ignore certain aspects and emphasize other aspects to get the, to make salient the data you need to act basically. So language is a very important tool for human action in that way, right? That we can, I can talk to you about that. I can draw your attention to specific things with words and then, you know, we're sharing this open source software that is English so we can connect our minds basically. Money is performing a similar function, but in a way, like a more, in like a higher signal way, and at a much larger scale, right? We're talking about coordinating entrepreneurial activities across the globe, right? And then you could get into things like the price signal, which are also denominated in money. You don't need people that are participating in the copper industry don't need to know that there was an earthquake in Chile that caused the mine to collapse, that made the price go up. They just need to see the number go up. And then it's like producers are incentivized to produce more, consumers are incentivized to consume less. And via this mechanism, the market rectifies the shortage of copper. So it's this money is like this extremely powerful tool for scaling human rationality and also integrating human rationality into the material world. Right? We start to think about the actual of goods and the demand for those goods in terms of mathematics, right? This is the price and the price I think is one of the most, I think it is the primary instrument for commanding human attention in the world, right? People's net worth, the prices of assets, Bitcoin, right? What draws everyone into Bitcoin? Everyone. I mean, maybe there's a few people like, Oh, I've studied the tech first and that's what made me excited. Maybe, but 99 plus percent of people are drawn in by the price and the price is only possible because of money. Money is only possible because of mathematics.

Mathematics only possible because of metaphor. So you buried the lead there, which is, and I think that's the part where I really want to emphasize and I really want to talk about and explore. You just described the importance of money within the human condition, in the human condition, in society. How vital this for society to run. The vast majority of people, and I'm sure that you've had a very similar experience, do not see this. They do not understand how vital money plays, how vital the role money plays in their lives. They're completely oblivious to it. I had a conversation with with my barber yesterday and I said you spend hours and hours and hours working to earn this money that is fundamentally corrupted. So that's the topic that I want to If money is this instrumental tool that humans need in order to organize a society in a non -coercive way, what happens when that money is corrupted? What happens when you introduce fiat to the mix? I'll end it with this and I'll pass it on to you. of the most powerful quotes that I've seen you say, and it was, I believe, in McCormack's show, is that if a country has a central bank, it is already 50% communist. So what are your thoughts on that, Robert? If

we're gonna continue with this definition of money, again, this is not the only definition of money, there's several, but it's one I'm working with lately, that it's a mathematical metaphor for human action, right? We're understanding human action and the consequences of human action in terms of mathematics. And this is a money facilitated process. Math is obviously, as we've already said, it's a universal language, right? We all speak the Hindu -Arabic numeral system today. There was a time where that wasn't true. I went through some of that in the number zero in Bitcoin, the history of mathematics and how it developed. But ultimately, a zero -based numeral system is the most useful numeral system. You can perform calculation faster, less prone to error, and therefore it's more useful for merchants that are conducting trade basically. So in that sense, it's an open source software, right? Mathematics an open source software. You're free to use it. Anyone's free to inspect it, modify it. You can propose changes to it even, right? You can develop new mathematical theorems. And if they are basically approved by other people, other users of mathematics, then that theorem may get incorporated into the corpus of mathematical most likely it will get rejected as most proposed changes do. But it is this open source software system that is very fundamental to really everything. Again, in that essay, prior to the Hindu -Arabic numeral system, -zero based numeral systems could not support calculus and calculus supports basically every modern science. So everything that we do in modernity requires calculus, calculus requires zero. So math's an open source software. Language as well you mentioned English yeah every basically natural language another form of open -source software now corruption right this is a term we use a lot we talk about the corruption of money we talk about Bitcoin as incorruptible money but we have to define corruption what do we mean when we say this I had a guest on here the other day who identified corruption as a lie, as a deception, fundamentally a deception. And there was some truth to that. I would say

it's entropy. I would say it's entropy over a long period of time. And the reason I'm saying that is from a historical perspective, empires rise and fall. Right? Over time, what happened in Rome is very similar to what is happening here in the United States. And you have timeless examples over and over and over again, where, you know, if you were at the height, you lived in the height of the Roman Empire, you would have never have imagined this thing was going to collapse over time. There was entropy involved, right? There's a degradation over time. Now, I don't know if that's part of the human condition. I don't know if that's part of humanity, the very famous saying that Bitcoiners talk about, right? Strong men create good times, good times create weak men, weak men create bad times. But I guess what I'm trying to say with all this is that is Bitcoin the uncorruptible system that we need in order for humanity not to repeat this endless cycle that I believe it's been stuck in for a millennia, really. Is it the solution? And the reason that, and you were just describing about how important the role of money is in society, what happens if we have, you know, to allude to your math references, what happens if we've been missing an entire part of the equation to create a non society that is efficient. What if we've been missing that equation? What if we have not been able to solve it until Bitcoin was discovered? Yeah, to start

with a point on entropy, right? Entropy is basically disorder. It's chaos, right? It's a thermodynamic concept for uncertainty, chaos, unpredictability. The opposite of that is negentropy, right? Which is basically signal, right? It's orderliness, it's information. and so money's interesting because The degree to which money and the money supply are predictable the more it can communicate about the uncertainties of Economic activity all right. We have no idea what businesses people are going to start how much? of anything they're going to sell, how much consumer demand will shift. There's a lot of uncertainty. The future is uncertain. It is inherently uncertain. It's irreducibly uncertain. Now what we need to do is gather information about that uncertainty. As the horizon of future is on coming we need to Gather information about that and disseminate it as Efficiently as possible to the degree that there is uncertainty in the money itself Right that the money itself is uncertain. We don't know the supply. We don't know who owns what even in fiat world We had wouldn't have one money, right? We have regional monopolies on currency. There's all of this arbitrariness introduced into this communications channel that is supposed to convey the resolution of uncertainty as we're doing it, right? As human action is dealing with uncertainty, we need to convey the consequences of that activity. But if there's uncertainty in the channel, right, then you have noise introduced where there's supposed to be signal, right? So you get an increased noise to signal ratio, and that's not good, right? That's detrimental to the ability of money to communicate about the consequences of human activity of dealing with uncertainty. And so to take back to corruption, you know, it's the etymology word, it's related to the word rupture, which is like the failure of an internal organ, right? If there's a rupture, an organ is supposed to carry blood or information or whatever the substance is from one organ to another. And if there's a rupture of the vein, for instance, right? Well, the blood can't flow from A to B so there's information loss there's vitality loss etc and it's it's an it's injurious to the organism obviously right if you have a ruptured vein well you need to get that taken care of or you're gonna be in big trouble so the arbitrariness that tends to get introduced to money is this human element of control, right? That this is an instrument of power in a very literal sense, right? There's purchasing which is what money contains. Purchasing power affords political power. With purchasing power, you can hire soldiers. You can lobby, you can rewrite laws, you can actually change socioeconomic reality with purchasing power. So you can buy political power with purchasing power. And therefore, uh, there's a lot of physical power that goes into the acquisition of purchasing power, whether that is actual production, right? We're producing goods and services via physical power, or could be confiscation, right? Armies go to war over money. They go to war to establish monopolies of money, etc. So the corruption element is something like, like the definition that I think is very useful is it is a set of unevenly applied rules, right? In an ideal situation where all participants and players in the same game, according to one common rule set that no one can change. Right? This is a principle we really derived from the laws of physics, right? And Jason Lowry would go into this and say, well, yeah, this is the fundamental game we're playing, as we're playing within the bounds of physics. No one can change the laws of therefore we all just play by them. And ideally we would have a money or even a rule of law that exhibited a similar integrity to the laws of physics. What this would do is it would induce people to play by the rules of that game, right? They would conform their actions the rules of that game because the possibility of changing the rules does not exist, basically. So in combat, in armed combat, for instance, we do this, right? We play by the rules of the laws of physics, but you could imagine this world where maybe we discovered some ability to manipulate the laws of physics, that would become the ultimate weapon of war. Everyone would fight over that particular apparatus because if you could change the rules of the laws of physics, that is the power to win every war that will ever come in perpetuity, right? You just turn off gravity. You I don't know, explode oxygen, right? You could just literally manipulate the laws of physics. You could change the equation of force equals mass times acceleration. You could totally just obliterate any opponent because you could wipe out the game board on which they're playing. So that is kind of a thought experiment about what we're doing in Fiat World, right? The rules are not fixed and there is a power, there's a rulemaking authority, which is I would call generalized to the central bank. It's an institution that cannot lose because they actually print themselves new units of money to extract purchasing power from the savers in that currency. That is equivalent to changing the rules of the game, right? People, there's an implicit agreement that people sacrifice labor, energy, and time to obtain the money. And there's an implicit expectation that that money can be later redeemed for similar sacrifices from others. that can counterfeit the currency. Well, then they can siphon purchasing power out of that money without performing any work, right? That's an asymmetry of rules. That is rules for the citizens, not for me, the central bank. Therefore, it's an asymmetric mechanism for extracting wealth and basically perpetrating theft.