Thread by @otisa502

1/13 Q. "You said that obviously if we see a digital dollar, a digital yuan, that they will not be deflationary, they will continue to print, it will be inflationary. What do you make of the commitment of the Fed and Powell to continue printing endlessly in this sort of

2/13 “exponential curve — I mean, we’ve seen them printing for years, but this real exponential growth in printing?"

A. "If you look at kind of like the fundamental ideas behind capitalism, you will see basically they believe in economic cycles, they believe in recession versus

3/13 “good times, and you’re supposed to save during the good times so you have money to get through the bad times. Over the last 20 years, we effectively — the monetary activity of the Fed and fiscal activity has basically told us that none of that matters any more, right.

4/13 “The Fed or the government is going to jump in to save us every time, which means that there is no moral hazard; financial players can take a tremendous amount of risk, take 100-to-1 leverage, and if they blow up, the government is going to have a safety net and catch them

5/13 “and nothing happens. Me and you can’t do that; we can’t get away with 100-to-1 leverage and have no consequences, right, but the big banks, the big institutions, are being saved. Today, the Fed is buying all of their debt, effectively guaranteeing that their debt trades

6/13 “at a fair value and they can issue record debt. Now, I understand, again, that Corona is a special case and so on, but the point is we should have had savings, we should have had reserves, because we had an amazing 10 years of growth and innovation and so on, but we’ve done

7/13 “the opposite; we’ve run deficits. Companies have spent $7 trillion over the last 10 years buying their own stocks, taking their profits and using their profits to inflate the value of their own stocks so they can get record bonuses. Again, no moral hazard, right; no one is

8/13 “going to go to jail. I remember when I came to this country in 1989 there was the S&L crisis, 3,000 investment bankers and bank officers went to jail because they basically defrauded all of us; and then just 10 years later when we had the fraud related to

9/13 “the 2000 dot-com stuff no one went to jail; and in 2008 no on went to jail. Again, this is corrosion of our standards, corrosion of what we all stand for. And, unfortunately, again, the 99% is standing there looking at the 1%, saying, 'How can this be fair? How can they

10/13 “flip the coin every time and it lands on heads and when we flip the coin we have a 50% chance of losing all of our assets?' I don’t believe in fixing that by going to Washington and trying to run for president or becoming a congressman or whatever. I don’t believe

11/13 “in that, unfortunately. What I believe in is, if we created a system that acts in our best interests and we convince enough people that we’re doing all the right things for them, they will all join, and if they all join with all their assets, there’s going to be nothing

12/13 “left for all these other guys who are doing all these shenanigans. Winning for me is about changing the infrastructure, changing the system, not about trying to effect politically or economically this or that institution.

13/13 “I don’t believe that that will ever happen.” — Alex Mashinsky via The Wolf Of All Streets Podcast, October 14, 2020

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