https://youtu.be/hpDDRBt0xyA?si=uT__BjBm-X8aOrPC&t=1129
Here is a part transcript describing the purpose of a central bank"So your listeners will be familiar then with the origins of the Federal Reserve. And, you know, fundamentally, the deal with the central bank has always been that the banks get inflation. And what the government gets is somebody to buy up its debt. All right. So this is, this is the origins of sort of the demon packed of central banking starting in, you know, the the Bank of England was founded. It essentially handed over control of the money. In other words, a licenced counterfeiting operation in exchange for buying up the national debt. So at the government wouldn't have to pay interest on anymore. So fundamentally, what that means is that central banks want to inflate always and everywhere. That is their purpose. That's why they were created. Their purpose is to inflate, to print as much money as possible. And you know, hand it partly to Wall Street in the form of cheaper loans that they can take and cut on. And partly to the government, which turns out to be by far the largest borrower in America, right? So cheap loans is excellent for the federal government. They can seize a bunch of money, essentially stealing it from everybody who has a dollar to begin with. And they're. fantastic for banks. Now, when you read newspaper articles in mainstream media, a lot of the times when they're talking about the Fed, they'll talk about the feds fight against inflation and
so normal people might be forgiven for thinking that the Fed exists to fight inflation, which is hilarious because the only reason to create a central bank. It's only purpose in life is to print money. It is a licenced counterfeiting. In other words, inflation. So the reason, of course, is that the Fed is aware that people, voters don't like inflation. And if they let inflation rip too hard, then the voters are going to, you know, put pressure on Congress and then Congress or the president. And that's then going to come down to them And they're afraid that they'll lose their independence, meaning that they won't be able to counterfeit anymore. Now, when that happens, interestingly enough, typically Congress, there have been banks that have lost independence in the government essentially taking them over. When they do that, actually, it's off to the races because governments have absolutely no self control whatsoever. But any rate, so the Fed is not fighting inflation because they hate inflation. They are fighting inflation to keep it low enough that the voters don't put pressure on Congress to then punish the Fed. Right. So empirically, the literature in central bankers argues for about 2% inflation. Now, of course, 2% is actually much more than that in terms of money printing, right, because the population is getting bigger, the economy is growing, the global population is growing. So 2 is probably closer to five realistically. So that's roughly a trillion dollars a year that are. counterfeited by the Federal Reserve. And when they fight inflation, what they're really doing is they don't want it to get to 4 or 5,6 percent where voters start getting upset, right. And so they try to rein that in. Now, of course, they're also slaves to a second set of headlines, which is economic growth, which the most salient number for that for voters tends to be jobs. That's sort of what sticks in people's head. If you talk about GDP. Most people don't have a strong opinion about that. Talk about jobs they do and really, they're essentially the same thing. So the Fed is. their goal is not to fine tune to get just that right mix of inflation growth. Their goal is to inflate as much as possible whilst trying to fine tune the negative headlines about the inflation they caused and the recessions that they caused to try to counter it because recessions do not happen on their own. It is not natural. Think about it. Right. What is a recession? So you've got a bunch of businessmen who are, you know, starting businesses or operating businesses. And every so often they screw up and they lose a bunch of money. They have to downsize. They go out of business. O. K. So, you know, whenever 3% of businessmen every year screw up and they fail out of the game. But in a recession, it's more like 20%. So why does that happen? Why does everybody get stupid all of a sudden? Right. It's it's not natural. It should, you know, you should have year in, year out. Most businesses are doing okay. Some are doing great. Some are doing terrible and you subtract one from the other and you've got whatever regular growth instead. with the Fed does is buy manipulating interest rates. It gives you this boom bust cycle. So you get this big tissue fire boom where nobody can do no wrong. The guy who started we work that that stupid office sharing he could get 10s of billions of dollars in funding Uber was what losing money for like 7 years or something alright so money is free because the Fed made it free so nobody screws up no businessmen go out of business you could be the biggest idiot on Wall Street and you're not going bus because you just borrow more money. right you know Uber you could lose what II think it was billions of dollars they lost every single year for seven years and they just borrow more money so nobody fails and then. when you choke off the money all of a sudden now yes 20% fail right so the recession is caused by the Fed. It is not natural there is no business cycle it is a central bank cycle so crazy the inflation is caused by the Fed so the Fed is not fine tuning some you know like physical phenomenon of nature that's just out there they are fine tuning the damage they do to the world. it's it's absolutely and thank you for explaining that so brilliantly and plainly it's absolutely mind boggling and I'm going to go out on the limb but. do you believe in the end the Fed movement then ohh my God for sure absolutely and it's not a lip hold back to Bitcoin whatever you need yeah. talk to me about that I mean, I know you're a big believer in Bitcoin I didn't your believer in gold so. yeah I'll take them both.."
