141 - Who Stole the Wealth? with Ben Hunt

Welcome to Bankless, where we explore the frontier of internet money and internet finance. This is how to get started, how to get better, and how to front run the opportunity. This is Ryan Sean Adams, and I'm here with David Hoffman, and we're here to help you become more bankless. Guys, excellent episode with Ben Hunt. We talk about wealth and who stole it. First, a few takeaways for you. Number one, why is the world on fire now? That's the opening question we ask Ben. Ben thinks the root cause is actually just a simple number. We get into that. Number two, who stole the wealth? Actually, why wealth is accelerating while GDP is flat. We talk about the difference between these two metrics. Number three, why the center cannot hold. Not against big tech, not against big media, not against big politics, why our world is increasingly fractionalized. Number four, how Wall Street and Treasury are defanging Bitcoin.

Ben's bear take on Bitcoin. Also his bull take. More bearish than bullish, I think, and you'll hear why. And number five, Ben's best advice for us in crypto and his hope for the future. We talk about all of these things. David, what are we talking about in this episode? And what should listeners pay attention to?

Ben Hunt and his Epsilon theory newsletter community, I've always appreciated it because of how close to the metal it is. Epsilon theory is going after the alpha of the market, which rides along the beta of the market. And these are all real parts of, you know, the market cycle, right? Like the fundamentals, the numbers. But the epsilon part is the part that Ben Hunt is truly excels at, which is the narrative part. And this was novel a few years ago when Ben Hunt was talking about the narrative and the storytelling side of financial markets. And now everyone has kind of woken up to it post all of these like Federal Reserve shenanigans and the fleeting nature of money. And so we're bringing Ben back onto the show to talk about what are the big narrative migrations, narrative movements that are going on in this the macro markets right now. And also just like how people are all waking up to the story of fiat currency. So as listeners go through this, I think it's one part a lesson in history of how the story has been told since the 70s, the 80s, and the 90s, and how that story has been conducive and flexible in creating a disparity between GDP and wealth, wealth being a lot higher than GDP. Listeners, listen to this. They'll get tune into a little bit of the future stories that they will probably hear out of the central bank, Federal Reserve members, but also what Ben calls, you know, big tech, big media, big politics. Just a little bit closer to the stories that we hear that we forget to pull back the curtain on, but Ben always does a fantastic job.

Yeah, that's great. He also has a lot of uh insight for people in crypto, I think, outside of our bubble. So Ben exists in kind of the real non-crypto world, I would say. He's definitely on our side from a core values and thesis perspective, but he also has some almost like fatherly wisdom, I would say, to offer the crypto. And that comes near the end. Don't miss that as well. Of course, David, premium subscribers get to stick around the show for the debrief, which is an episode after the episode where you and I talk about this Ben Hunt episode. So, David, what do you want to talk about during the debrief?

Yeah, Ben Hunt's characterization of Bitcoin as art, I thought was really interesting that, you know, not to undersell Bitcoin as a financial asset, but it's also much more of

a cultural expression of values more than it is money, I think is a new take that I want to unpack with you in the debrief. What do you want to talk about in the debrief, Ryan?

I think that Ben was a little more pessimistic than I am on crypto. So not as pessimistic on Bitcoin TM. Well, maybe that, but not as pessimistic on DeFi TM or Bankless TM. I think we have a real shot at making this more than a bumper stick or making this a real revolution. Anyway, listeners, get a flavor of that in the episode. And if you're a premium member, you can stick around for the debrief. Of course, you can always upgrade to premium membership. There's a link in the show notes. Guys, we're gonna get right to the episode with Ben Hunt, Bankless Nation. Super excited to introduce you once again to Ben Hunt. He's an investor in the creator of Epsilon Theory, which is a website. It's an internet community that examines markets through the lens of game theory and history and narratives in particular. Does a fantastic job in general pulling back the curtain on what's really going on in the world and getting to the bare metal of things. Ben, welcome back to Benglis.

Well, it's great to be here and thanks for the kind introduction. I've got to have you do uh

be in front of me every time I go somewhere to speak. So very good. Excellent.

Happy to do it, sir. I'm a big fan of your work. And it's been actually um two years, a little bit more over two years, since you've been on banklist. And so I think a lot has happened in the world in the last two years. And I know you've been keeping you're someone who keeps a keen pulse on like reality versus narrative. I guess one narrative that feels true in my mind, and I want you to check this against reality, is it feels like the world is on fire right now. Like we're not in control. And I'm wondering from your perspective, if this is unique or if this is just a thing that's always happened in history. And every generation, every kind of moment in time has its struggles and problems. Is this unique or is this something that is pretty normal?

Unique's a strong word, you know, a stronger word than I would use, but is it the first time in 40 plus years that the world has been in a situation like this? Absolutely. That 40 year number I I use

advisedly because it was 40 years

since the last time we had dramatic repricing of money.

And that's what's happening right now.

Money

globally is being repriced.

That's always going to be a searing event.

And it's particularly searing

given the amount of money that has been borrowed and has been is now sloshing around the world in various forms.

So a global repricing of money

is about as big or as impactful

a global event as you can have.

And it absolutely means that

central banks,

in other words, Western economies,

cannot paper over

their differences anymore.

It's impossible now, right, to just print your way out of

a real world problem that comes up,

like a war,

like

an energy crisis.

You just can't do it.

We're returning to an environment of every country for itself,

returning to an environment where,

as Thucydides said 2,500 years ago,

that the strong do what they will and the weak do as they must.

So it's not unique.

It's happened, you know, many times before, including 2,500 years ago with freaking Thucydides in Athens and Sparta,

but it sure is the first time in my adult life.

Where this has happened.

It sounds very volatile, very chaotic, this era that we're entering into once again.

Well, I actually want to stop you there. I'm going to stop you there. I wouldn't describe it as chaotic.

And what I mean by that is

what we're experiencing is not an aberration.

What we're experiencing, I believe, both internationally and domestically here in the United States, it's an equilibrium, which is just a $10 word that means a balancing point.

So chaotic, obviously that's a term of real art when you're talking about physics, but I take it for what you meant the chaotic in a colloquial sense, that you know, that anything could happen.

I actually don't think that's where we are.

I think we're at a pretty

stable balancing point.

Unfortunately, it's a very painful balancing point.

So I just had to interrupt there. I don't think it's chaotic, but I think it is absolutely

once in a lifetime, once in a generation,

and searingly painful.

This idea of money getting repriced, I think that is foreign to people because when people think about money, they think about dollars. No, that is the thing we price things with, Ben Hunt. Money can't get repriced, can it? That's a foreign idea to people. And if it's repriced, what is it repriced against? Other types of monies? Are we talking about like foreign currencies?

No, no, no, no, no. The price of money is an interest rate.

That's what a price of money is.

In the beginning, I was just writing a note about this. So this is so great to have this conversation. So in the beginning,

there was, and I'm talking in the beginning, like 10,000 years ago, right? In the beginning,

there was a person with a business, you know, doing some economic activity, hauling, you know, grain from point A to point B, whatever, right? In Sumeria, right? Person with a business, and they wanted money from a person with money.