The Sovereign Individual Investment Thesis with Phillip Bonello

previously with Ikey Guy Fund. He has been doing research into bitcoin and crypto for a number of years and has some amazing insights from all the research that he's done. And today we dig into a paper, a investment thesis that he's put together based off of the book The Sovereign Individual. If you haven't read the book, I highly recommend it, but today we'll give you the cliff notes

of it. But there's three points that the book makes and he makes into this investment thesis, which is well, I'm not gonna spoil it for you're gonna have to pay attention, but we get into some great talks. The book is amazing. It was written in seven on the internet was just in its early stages, and it's amazing how prophetic this book is and all the things that are coming coming to fruition today. It seems like the book was just recently written. So anyway, it's a great conversation.

You're gonna learn a lot about what this technology is doing, the shift that's happening in the world, the behavior changes that are happening right now, and what the world, you know, the global macrof picture of the world is doing right now to really push the adoption of the branding technology. A great conversation, a great book, and let's just go ahead and just jump right into it. Everyone. Welcome to the Market Disruptors Podcast Today. I am joined by Philip Vonello.

He has previously had a research over at Ikey. Guy has been researching crypto assets and bitcoin um and has some really good insights. He's written a paper recently about a book on the sovereign individual and kind of an investment thesis around that which was was amazing, kind of rock the world. Everyone's been talking about it, and so I wanted to have him on to discuss that. I'm super excited. Welcome Philip, Hey, thanks Mark, thanks for having me. Yeah.

So um, you know, we've we've we've had the privilege to talk a little bit. I read your paper, Um, so, lots of stuff to dig into. But before we do that, maybe just kind of fill us in a little bit on what you've been working on and kind of where you're at right now. Yeah. So, like you said, I worked in sorry for a little bit, uh than with head research. I guy. Recently, I've just been taking some

time off exploring different kind of avenues. And one of the things that I've been digging into a bunch of just kind of a worldview. So, as you mentioned, I recently published kind of an investment thesis based on the book The Sovereign Individual, which is a really trucient book written in I'm almost embarrassed to say that I read it recently because it's such a a lot of a lot of people in the bigcoin space really love The Sovereign Individual the book, and it really was an eye

opener for me. Yeah. So the last couple of years you've been doing research, Um, tell us a little bit about the kind of research that you've been doing though. Yeah. So in two thousand and eighteen, I really dug in and tried to understand why any of these crypto assets were valuable. So what that kind of led me to is building out a series of different frameworks. So essentially the way that I look at the entire crypto asset world is through the ones of productive assets and non

productive assets. So you can think think of non productive assets as something like bitcoin. By holding X, you don't get any any why there's no exhougenists cash flow, right, um, similar to something like gold. Uh. And then in the productive asset category, if you hold X, you get why right,

there's an exhaugenists cash flow coming into the system. Uh. Something you know that's something like Auger, right, where with Auger you can you can stake rep and you're going to get a certain amount of and returned to the proportion of REP that you stay. So that really led me to build out a series of valuation models. It really helped frame my thinking for the entire space. Uh. And I kind of took that thinking and evaluated the broader ecosystem and um kind of how value accruise in

the in the whole system. In the crypto stack, I would say, so you really dug into these different assets and kind of classified them into productive and nonproductive. Um. But then were you also kind of looking at UM. It sounds like you were also looking at maybe like the act the macro economic picture as well, to see where do these new assets, where do they fit into

the big picture of kind of where the world's at. Yeah, So a lot of what we did I was thinking about the macro perspective, given what's going on in the world right now, what is the demand for these crypto assets? Uh, you know bigcoin sets that are really pretty interesting space, and that it's both a risk asset but it's trying

to be this reserve asset. I think the rest of crypto is pretty solidly and kind of the risk asset category M and then and then taking a step deeper, it's okay, based on that macro perspective, what is the

crypto macro looking like right now? And broadly the crypto macro a lot of time is influenced by Bitcoin, and so we use a lot of enchain metrics to kind of study cycle UM and and how we think all coins are going to react to the bigcoin cycle and how bigcoin is gonna react and so on and so forth. And then and then the final level was digging deeper into each one of the projects, analyzing the product that each one of them had, and then the asset that

each one of those had with relation to the product. Um. Like I said, a lot of these are nonproductive assets, and in our view, there's not really a link between that non productive asset, uh, and I guess you know the product. Yeah, yeah. I I like looking at the macro view, especially when you're dealing with like technology like this, because it gives you I I kind of feel like the bigger picture is almost easier to see than the

small picture. Like if someone says, hey, Mark and I get asked us all the time, like where's bitcoin going to be in a week or in a month, And I'm like, I don't really know, but I kind of have a feeling of where it's going to be in five years from now. Um And and a lot of times I think about it like you watch one of those movies where people go back in you know, in a time machine, and if they touched one little thing and then they go back to the future, it makes

this massive impact. And that's kind of like we can see these little things happening today that have that massive impact. That's pretty cool. UM. So thanks for giving us that background I think it's important to to get your perspective

as we move into this. But so, so you wrote this kind of investment thesis off this book The Sovereign Individual Um, which as you said, is kind of big in the in the in the bitcoin space, maybe because it was for telling of what was going to happen, right, I mean the book was written there wasn't really I mean, the Internet was a round, but it wasn't even really hadn't even really taken hold yet. So for them to write this book at that time was a pretty big,

pretty big deal. It was like they did a good job. So kind of give us the overview of what the books about and maybe your investment thesis you pulled out of it. Yeah. So, I mean one of the things that's that's really interesting about the book is that they do a pretty good job of predicting bitcoin. You know, they think that there's going to be a currency that's backed by gold. So they're a little off in that respect,

but but still pretty incredible insight. I Mean, broadly, what The Sovereign Individual talks about is the logical violence, uh, and how that has really affected big trends throughout history, so especially starting with kind of the agricultural movement. With our with humans moved to agriculture, we started to have their mergence of personal property, and with their emergence of

personal property, violence at scale uh really became valuable. So we we saw the rise of these different types of bureaucratic entities, these different kind of organizations to really uh ah provide protection for groups of individuals who needed that protection. Right. And and then as we move into the information age, a lot of that stuff gets turned on its head. Uh. So there's there's reduced information asymmetry. Uh, you know, there's the potential for money that is outside the control of

a central government. And then encryption completely changes the logic of violence and the way that individuals can protect themselves. So for the first time, really, um, an individual can hold let's say a billion dollars and and there there the way that they protect that billion dollars is just about as good as the way that the US government would protect that billion dollars. Right. Encryption decreases the cost of protection and decrease. It also decreases the leverage that

violence has on people. Yeah. Yeah, So let's let's unpack that a little bit. So you talk about information technology. So the Internet was information technology, right, so decentralized information. So previous to the Internet, Um, information you said had eight what do you call it? Asymmetric information? I forget

to work just there's uh information asymmetry. Right, So certain certain organizations have control over all this information and they distributed only to their members and think about about it like that. Yeah, and so information was controlled and really you could chase this all the way back to you know, Martin Luther times in in Europe and whatever, the four dreds where the church kind of controlled the scripture and it wasn't until the printing press came out that then

it was able to spread that information. And that's what broke the power at the church had over and uh and the Internet has taken that a step further, right, So we have kind of leveled the plane field on information. YEA, yeah, that's exactly that's exactly right. Um, I mean yeah, sorry, go ahead, Well I was gonna say so because the information is now spread out and across borders, across the globe. You made the point, right, it's broken down the jurisdictional barriers.

So now instead of like one country that kind of has all the information Now it's kind of starting to be global. Yeah, absolutely, and I think that's um, that's one of the biggest drivers to this, this broader trend. Everyone has access to the same information, so everyone can be educated in relatively the same way. And when everyone can be educated in the same way, then everyone can do mostly the same jobs, jobs that used to be

considered skill to work. Right, And so when you think about kind of mean reversion, uh, the people who used to do that skilled work in the developed countries are are used to these high wages, but now they're being undercut by people who can provide those those same that same level of work for potentially a quarter of the quarter of the cost, right, And so it seems relatively inevitable, inevitable that there's going to be this mean reversion from

both the developed countries and the developing countries. And so I think that was that was one of the key insights that I took away from the book m just this idea of decreasing information asymmetry. There's a decreasing value to location, so the exit costs are are much easier. You know, let's let's say, uh, my wages personally are are going down. I can no longer afford to live in l A, So I have to go to a different jurisdiction, a jurisdiction that might be more business friendly. Uh.

They have lower taxes, um. You know, they have subsidies for starting up entrepreneurial ventures, um and and and it's really easy to do that because I can run I can run my business from anywhere in the world. We're we're previously you know. Uh, there's there's a lot of value in being in the central locations. And we haven't quite seen that shift fully yet, but you can see the beginnings of it. I mean it's it's definitely not fully shifted, but we've definitely seen the beginnings of it.

What's interesting is, at least I don't know, I haven't fact checked it, but a decade ago maybe there's an author Daniel Pink He wrote a book called A Whole New Mind, And basically the point that he made in the book is that, um, the whole world has been set up for technical roles. College teaches people technical, SA t s are technical. All the jobs were technical, right, engineers, etcetera. But because of the Internet, as you're saying, UM, now

it's taken technical roles and made them commodities. And so now being the engineer or whatever, the codeer, the developer is not where you want to be because now that's been commoditized, right, I can hire does dozen them over in New Delhi or whatever. And so he calls it a whole new mind because we kind of have a creative side and analytical side of the brain supposedly, And he said, in order to be successful in this new age, you have to use the creative side of your brain.

And instead of being like if you think of like an orchestra, instead of being the best troumbone player, the best horn player, you're the conductor. And I can't play the music better than any of those people, but I can make them make beautiful music together. Yep. And and and those people today have more leverage than ever before. Right, So uh there's creative people, yeah, the creative people. Right.

So essentially, entrepreneurs and investors have more leverage than they ever had before because, uh, they can be really creative. They can coordinate all these resources while they're sitting in the living room. Right. Um. On the flip side of that, workers have more competition than than ever before. So uh, yeah, you know, work, work, works, smart, not hard, you know,

there maybe something something to that. Yeah, well, the school systems definitely have not kept up with the with the changes of technology, and so there's still training everyone to be technical, technical, technical, but we've gone to a creative world and so um, there's a there's a big challenge there, which we'll get into. I know, you start talking a lot about education, and that's the part that I'm pretty

passionate about. It's interesting though, you know when you look at what's going on in the world today with you know, all over the world right now, right from Iran and Lebanon and Hong Kong, especially Hong Kong, but Chile, and I mean you name it right, it's erupting and especially

like in Hong Kong. Um but it, as you called it, borderless information reduces jurisdictional barriers and and I find it like hard to believe that in this world today a country can still own you, Yeah, like your own you're you're basically slave, right, You're owned by the country. And how in the US, right half of my wages go to the government and I can't leave. Yeah, I mean I think that's a cheat problem. I think there are

some technical challenges to that. Right, our systems are set up in a way that we inherently give over our

data when when we use a given application. Um. But like what you were talking about as far as high taxation, it's gonna be really interesting interesting in the coming years with kind of the wealth tax, you know, the whole movement of tax the billionaires, um, and potential for something like m M T. Right, Really wealthy people especially will probably be leading the charge of Okay, how do I

protect my well here? Um? I might have to either protect it from seizure or if they're protected from inflation, right, And you know, the coins are pretty pretty interesting tool for that. If you look at how um, you know, life has evolved, um, I mean not since the beginning, but just you know, you look at like Game of Thrones or whatever, right, and it's just like little tribes and the one would attack the other one to see

older resources. And so you know, you kind of had to get these like kingdoms which then became countries, and still countries were taken over the countries to steal their resources. But now moving into like this more information age, which I guess we'll get to like a near encryption part, which is now we can protect our resources in a completely different way, which means the threats that we have

are not the same as they always have. Like someone can't just come take over my house because my assets aren't or my you know, it's not in my house, right, it's like digital or whatever. Yeah, and you know, there there are still levers to be pulled in the physical world. You can still be attacked physically, still be killed, right, Um, but more and more assets are outside of the purview of of kind of government government interference, outside of just

physical coercion. I and and that that's a really interesting trend. Yeah. Yeah, So, um, while I see the information being uh this kind of commercial or more or list kind of jurisdictional thing dropping, it's gonna be interesting to see how that plays out. Um. I know you quoted um Jil Carlson and she had talked about how the Internet grew up and it and it created this borderless um you know, mind share, information share,

but financials got left behind. And it reminded me of a story I saw Eric Vorhees right a while ago where he kind of talked about, imagine if we had this internet and instead of this Internet, that connected the whole world and we all shared information. Imagine if we each had our own little regional internet and we just

had the United States Internet and there was a China Internet. Well, I guess there was a China Internet, but you know, each country had their own little internet, and how different it would be. And then he made the point, well, okay, now that you've imagine that, well, that's exactly how money works. And so um. Anyway, it's interesting to to kind of look back and see how the information has been decentralized

and how hopefully money's next there. Yeah, which takes us to the second point of your paper, which was that or from the book, which is the creation of non sovereign digital money. And I guess that kind of creates competition with the money, which once we have competition with the money, then you said, it decreases the power of inflation and taxation. Yeah, and and so so take take

a quick step back. You know, when I started thinking about this thesis broadly, I looked at it through uh kind of sources of demand and I use acquired defend bond learn and feel as kind of the sources there and what are what are those? Those are? Those are like the five human motivations. Yeah, and you know, we can like it's up for debate what what are the primary human motivations? But I, uh, we we know for sure greed and fear right to at least yeah, yeah,

you know, so acquired defend. But I think there you know, there's a there definitely is an inherent desire to learn, there's a there's a design are to be loved, So that's kind of the bonding. And I think there is a desire to feel or to escape right from from your mind or what have you. And so U four of those are borrowed from the book Driven, which which

talks about it in a different context. But I the reason I wanted to look at things, uh through the lens of demand is because I really like the way that Jeff Bezos framed uh. You know, he he talked about people ask them all the time what's changed or what's going to change in ten years, and he always says, well, it's a lot easier to look at what's not going to change, right, And I think broadly you can look

at human motivations and how they're not going to change. Um. But what's interesting in the crypto space is that I think there is a behavior change that needs to happen, right, So we're very much focused on, uh, this idea of acquire agreed right now, and to an extent, have ignored kind of our defensive practices. We outsource, we outsource protection. And this is evident in and the way that we use applications today because all like Facebook has all of

our data, Google has all of our data. Right. Um, it's just the way that it's set up. And people people brought like pretty much don't care. So one of the trends that I see is is as it um is that we'll see this, uh, this motivation of defend, this need for defensive technologies to increase, right, and so so the idea of digital money is kind of a defensive technology. People don't really care about it until they have to. You ask most people right now, they say, oh,

the U S dollars. Fine, it's it's the US dollar, right. But I think there's all different levels to that, right. So I work with all types of investors and go through training stuff. And it's like in the beginning, when you're young and you have and you don't have much money, you're just risky, right, You're greedy, I need to get more money. But as you get older and you have money, than it switches and now you have to protect that money.

Were like, you're young and single and you're thinking about yourself. Well, now I'm a father and I have kids, and like, you're better to be sure I'm ready to protect that family. Right. So, I think our motivations as humans are the same, but they change as we go through life. Maybe yeah, yeah, that that's definitely possible. And uh, I think it's probably an environmentally dependent um you know, some someone someone in Venezuela is definitely a lot more sensitive to the idea

of inflation than someone in uh from the US. Um And and I think I think that those environmental factors definitely affect the demands our motivations. So so so that's kind of what I what I argue in the paper that we have this technology, we have the ability to opt out of these systems. We understand the supply right, twenty one million bitcoin. That's a great narrative, but I think a lot of people are you know, they're they're arguing about demand. Where is the demand going to come from?

And uh, as we see more capital controls, as we see increase inflation, as we see increased taxation, then the demand for an asset like bitcoin will increase. And with that, it's also the idea of kind of these self sovereign and technologies. So right now bitcoin is firmly speculation right exchanges, funds, data providers, rugrad services, that's where all of the investment is going. There was this idea of decentralized exchanges. Um, they haven't gained a whole lot of adoption, h but

I think that's gonna be. They're going to be very important at some point. At some point. Uh, self sovereign custody is going to be very important at some point, Like the user experience for custody has to improve. Well, I think you made You made the point that those things emerge when there's a need, and that's kind of capitalism and its best right. So it's like, um, there is starting to be a need for having a non

sovereign digital money. And as you said, right in the US people don't see that, but in Venezuela or you know, Lebanon or Iran, when the bank's just open back up after whatever a month, like they have a need for that. Um, the essentialized exchanges. We haven't really seen a need for that, but once we see more increased you know, regulatory crackdowns, there will be a need for it. And then and then my hope anyway is that we'll we'll see that

start to pop up again. Yeah. And and in some ways, these fully decentralized systems UH aren't necessarily the way to go. You know, like you look at bit macs, you look at finance, you look at usd T. They aren't wholly immutable or not centership resistance or completely centership resist and you're still depending on a third party, right, But they've been able to kind of skirt regulations and they've been

extremely successful, you know, almost because of that. Yeah. But if we're sticking on the back to point number two, So we talked about point number one was the information reducing the jurisdictional barriers. Number two was creation of non sovereign digital money um and and I think you're talking about inflict the the sovereign individual. The information technology is helping to push that digital money obviously because it's built off of the Internet. UM and it's decreasing the power

of inflation. So right now, the governments around the world, including United States are are pushing inflation on us right there, stealing the value of our money. So that is a reason that's causing this creation of this non sovereign money. And yeah, and and I guess a competition for money, right definitely. And I think right now, the logical conclusion there is Okay, well, I'm gonna buy gold rum. But but then, um, you think about transporting golden, You think

about the ability for someone to seize your gold. You think about the ability for something for you to store, let's say a couple of billion dollars for the gold. You know. Talking about these really wealthy people, I think that's where the trend is probably going to start because they see these problems. They'll see these problems before everybody else.

And and that's where we'll see the difference, right in this the reason for the center to persistence and um, and the more the more that governments inflate their money and sees people's money, the more they're going to be pushing people to options like this, right yeah, absolutely, Yeah,

it's kind of unstoppable. I think. I guess we just have to ask ourselves to the questions, do we think governments will magically wake up and be fiscally responsible at some point or will they continue to push it as far as they can push it. And again, going back to human motivation, I think we know the answer, right, yeah, yeah, you know, the these systems are set up in a way that they want to get real people. The people

in power want to get reelected. The easiest way for them to get reelected is for their economies to do well. For their economy to do well, they should probably print more money so that the equities markets continue to boom. Yeah. So the third final point was the encryption. That encryption produces the cost of protection um and decreases the leverage

of violence scale. And we touched on that um. But I guess when you add all that together, I mean, it's the encryption you're saying, is is protection for us?

And I guess with point number one about information, So we could have information that could be protected, uh and and secret or private, but then also then money we can create our money, save our money and then encrypted all I mean going to that point yeah and um so so yeah, we we have the ability currently to send information around the world in in an instant but like you mentioned, there there are there is the ability to censor a lot of that a lot of that information, right,

and so that's where this idea of kind of these crypto applications comes in. And my as a hobby kind of brought this idea of dissident technology, which I think is as as an elegant way to describe the value proposition of crypto more broadly, um, it's it's it's something this whole movement is really to be able to exist outside of the purview of government protection. It's kind of saying we can protect ourselves now, let us and and so, and encryption is is a really interesting thing because it

makes it easier. It makes it easier for me to protect myself just as and pretty much just as easily as a large corporation, um can protect themselves. And then also what do you think about a large corporation versus an individual. A large corporation is a honeypot, right, And if you're if you're keeping your assets with that with that organization, that corporation, their their encryption probably isn't any

better than encryption that you have available. Um. So, so you look at the reward for attacking that organization versus the reward for attacking the individual and it it tilts that, it tilts that scale. Yeah, and we see it happen all the time, right target and experience, and they're all getting hacked. The n s A was hacked, and when they hacked the n s A, they stole their hacking software,

right because they are those honeypots. And it's kind of like if if you would go rob a bank that had a billion dollars, or would you go rob a billion banks that had one dollar each? Yeah exactly, it's like that that so you but you talk about how like as individuals have more control of their property than we have more need to defend that property, which I kind of made like as I get more money or as I get a family, and how we've been outsourcing that.

And I think back to kind of like how you know, the banking system started, so you know whatever the eighteen hundreds. Previous to the eighteen hundreds, I would just store my gold in the ground somewhere or whatever um and then eventually I could just put it in a bank and then that bank would be I'd be outsourcing the security right to that bank. So maybe it's only been a couple of hundred years we've been doing that. I mean, do you see that being this big behavior change, you

think that that's gonna have to be made. Yeah, So I think, you know, I think it's really Yeah, it's been since really the agricultural revolution, since the emergence of personal property, that we've kind of had this outsourcing and protection because you know, like the biggest guy in town, the most powerful guy in town, that's the person who who you can hire to protect your assets, right, and he gets some of his guys around, and now he has this little army and you pay, you pay that

leader to protect you. Right. And that that in in in different forms and fashions, has kind of persisted. Um. And now with the idea of this dissident technology crypto broadly, I there are two there are two levers that people kind of think about. I think in the crypto world it's like cost efficiencies and um, it's the idea that Okay, there's no middleman anymore, and so now there's decreased rent

seeking and and I can buy that to a certain extent. Right, some some of the costs will come down, but there there still is rent seeking on the part of someone within the or some people within the system. Right, Um, and the the efficiency isn't that, it's not that great. What is a big kind of like the ten Ex improvement is the defensibility of these systems. And and that's where I think, Uh, that's where I think we need to see demand. And right now we're everyone in cryptos

like why aren't people adopting any of these things? And I think it's just it's just to demand issue. Right, Um, there hasn't there hasn't been enough ruined to to demand these type of protective services. Um, even though we have had that Equifax, you know, equifacts hack, Facebook, Yahoo, like all all of these big all of these big hacks and hum, these large data holders really mishandling our our property,

right um. And and so we're gonna have to see a shift of behavior from kind of this this motivation of acquired to this motivation to defend your your digital assets as as we increasingly have more digital assets. Yeah.

But when you talk about dissident tech, maybe just unpacked that what are what are you talking about like that as kind of like a whole or maybe as that can asset Yeah, I'm talking about both like things that can resist censorship and things that are generally anti fragile, so UM and like fight against the government or to a certain extent that you know, that's one of the that's one of the use cases. But it's also um like you think about like mesh networking versus some of

the r I s p s currently there. These are central points of failure and they're easy, they're they're outdated in many respects, and they're easy to take down. UM. Whereas if if you can create these these networks that are really resilient, and even better than resilient, they're anti fragile as people try to attack them, you're making them stronger something something really like like bitcoin. Uh, that's that's kind of the holy grail, and I think that's what

we're starting to work towards. But we're starting to see, yeah, very really does for for those that don't know exactly what he was just talking about. So what we're seeing

like in Iran right now is they took down the internet. Uh, the Internet went down in Iran because they don't want them communicating, or or even in Hong Kong, we don't want the protesters communicating, and so they have mess networks, which basically allow phones to communicate one by one and kind of create their own network that can't be taken down. And so, um, I mean I think that that this type of technology is in a direct response to that

stuff that's that's happening. Um, you made a quote about, um, the balance of the lion and the lamb, and how if the I think you said, like, if the lion got faster, there would eat they would eat too many of the lambs. And if the lamb got stronger than the lions would starve, and there needs to be this balance. Um, do you see like the lion being the state and

the lambs being the citizens. Yeah, basically, essentially nation states have benefited from being very strong militarily, they provided protective services. But now the equation is has changed drastically. More happens outside of the purview of the state. Individuals can protect themselves. Information isn't controlled as much by the state. And so my the way that I described as us lambs individuals have grown wings. You know, we can we can kind

of avoid the lion, avoid this predator. And and it's it's this this idea that nation states will continuously have to treat citizens more like customers, right, and that would exactly you know, wouldn't it be nice? And it it should, that should be the way that things happen. Right, we give so much money to these these sovereigns, but are are they the best people to handle the money? Right? And you start you start to think about that, and it seems far fetch that that a nation would treat

you as a customer. But I think Singapore is a great example. In Singapore's reference frequently in the Sovereign Individual, which was written and now we can look at Singapore, you know, twenty years later, and it's it's pretty shocking, right, Singapore has been incredibly business friendly and what has happened.

A lot of businesses has moved to Singapore. It's interesting that we even have to say that, especially as both of us it in the United States right now, because in the United States, it's supposed to be like a servant leader, right Like it's supposed to be the people that are supposed to be serving the people. It's a

government of the people for the people. However, there's been a massive shift over the last probably decade or so where now I think the average person looks at the government as as a ruling class right there, they're not representing us anymore. They're doing as they want, and now for us to even have to talk about that, like they should curious as a customer, Like, no, they should look at us as their bosses. Yeah, but anyway, that's

not the case. But yeah, maybe it's hard, it's hard to imagine, but maybe at some point where, um, with those three factors, as you said, right, with the with the widespread use of information breaking down the barriers that we could move to the country that best suited our needs,

and then they started competing for us. Yeah, exactly, with more happening outside of the purview of governments, the ability of individuals to protect their property through encryption, decreasing decreasing information asymmetry, and decreasing the value of location, people can easily go to other places. And when when people start

to leave, then revenues start to decrease. Right. Problem The problem is is, as you identified, kind of like the five of human motivations, one of those being greed, which seems to be bigger and more powerful than the other ones, especially with certain individuals. And so you're always going to have these people that are gonna want to control, right, So, like you know, uh, we see it in the Parent Teacher Association. I see at my homeowners association. We see it,

you know, at the presidential level. Um. So it's like one country says, hey, come set up here. We're like, you know, business friendly. But then eventually someone's gonna want to control that. Do you think that that greed factor

always is going to take over? Absolutely? Yeah. I mean, but I think all of these things are just checked right, and as a few businesses, as a few billionaires, you know, start to leave jurisdiction that has high taxes and high inflation to a jurisdiction which is more friendly towards these wealthy people and more friendly towards businesses, then then I

think more countries start to take notice. You know. I think we're both in California, which is probably u at least the second worst state in the in the nation behind New York, if not the worst state for taxes and the way they treat businesses. And we've seen businesses leave the state in droves. The rich have left the state in droves. The rich have left New York in droves, and they're all headed to lower tax regions no state tax regions, Texas, Florida, etcetera. But yet the States haven't

decided to change. If anything, they've gotten, they've doubled down on it. Yeah, I mean we'll see, we don't know. I think this is the trend. But I think timing is timing is a big question. Yeah. Now you made you made one point, um that I wanted to touch on where Um. I guess the first point was about information and now with the widespread information and allows us this arbitrage to live kind of wherever we want. And

you talked about how it's an especially interesting sector. You made the comment, um, because of the way that it gives people this you know, ability to access information, um, which can really take hold. And how you're expecting like the edge industry to grow to ten trillion you said, by um and add a hundred teachers. Wh Where did you kind of come up with that thesis that thought, Yeah, these these are estimates that I found in a fairly

comprehensive report. I actually should probably link it in in the in the paper. But UM, I think that education is really the the gating factor here because it it kind of allows the rest of it to fall into place. Uh. And when you think about education, people can become educated really easily. Uh, They have also the information at their fingertips. Uh what is what is maybe a little bit more

difficult is the accreditation. And when when I think about the real value of universities right now, it's it's in accreditation. Right like you went to Stanford, you went to Harvard, you went to Yale. Uh that that that holds power right there, you know. And uh, um, but that power is being reduced. I made a video about this. Um. A lot of the big fortune companies have taken away the requirement to have a college degree. Now, Apple, A, T and T, Marriott Hotels, they've all taken away that

requirement now. Yeah, and so that's that again, right, like the one little change in the drastic difference it makes. And so by changing that, it takes away that that accreditation piece, and so that's gonna help us, right. I agree with that viewpoint. That's why I was just curious about that. I think that's probably the biggest shift that we'll see. Yeah, and I think that that opens up an opportunity for someone to make a really good accreditation service,

right whatever it may be. Like, um, I think it was Eric Tornberg he was talking about, right, what is like the next linked in the next iteration of LinkedIn, because linked In in in a way is is providing these accreditation services and it's like an online resume, But can you take out a step further further or is is it do you have an online portfolio or you know,

what does this tend to look like? And and there's a big opportunity to own that that point kind of my my thought on that is uh, because h is is that we're already seeing this shift, right and and they and they said like in the next two years, I think like jobs and the US are projected to be gig jobs. And so what we're starting to see is like I want to specialize in running Facebook ads, and I can work for five or six or ten companies to run just Facebook ads, and I can be

the best Facebook ads guy. Where I can be a copywriter, or I can be a video editor and I can just be a video editor. I can be a bookkeeper and I don't have to be hired full time with this company to be a bookkeeper. Just be a bookkeeper for twenty companies, right um. And so it allows me to just learn how to do bookkeeping, or learn how to do Facebook ads, or learn how to do whatever and I can watch YouTube videos for that, right, Um, and then I can just offer those services on a

gig basis. And people think gig jobs are bad, but they don't they have to be um. And maybe just that whole because like as you already made, the case that we agreed on is that like that that technical role is diminishing M and so, UM, maybe I don't need that college degree to go get that job at a T and T. I could just become a bookkeeper and work for ten companies on the side and live in a jurisdiction that has cheap rates, and I could live a very good life exactly. Yeah, I completely agree

with that. Uh yeah, I think we'll we'll continue to see more of that because, uh, people are going to become more and more disgruntled in developed countries because because they expect high wages and they pay a lot of taxes, they pay a lot through inflation. Uh, and they pay a lot just for their property. Right. Yeah. Yeah, Well, some good stuff we went through. UM. I want to wrap it up with one last point here, one question. And so you said that, Um, you think the tipping

point will be in the next ten years. Um, I guess based off of your thesis and what you're seeing. You think the tipping point when this really all kicks in isn't ten ears. Yeah, and I think that that revolves mostly around, uh, the idea of distance technology and centership resists in digital money. Um, it's pretty wild right now. But I mean you you read the Sovereign Individual, it sounds like it was written last week, to be honest, right there are It talks a lot about the rising

nationalism and like these neo Luddites and um, higher higher inflation. Uh, these trends of taxation. And it's it's pretty wild too to read, to read the Sovereign Individual today because it it honestly was just so oppression. UM. So I you know,

the ten years is kind of a guest. You know, it's it's hard to time these things, right, but yeah, just based on how things are, how quickly things seem to be moving, um in the press in the press today, Yeah, it seems like just in the last six months, seeing the increase in rise or in the last year, the increase and rise in UH in in demonstrations and protests and and and the need for this distant tech as you're talking about seeing the mesh networks and facial recognition

stuff being pushed just in the last couple of months, and in Iran and Hong Kong it's almost like the governments are wanting to usher this and even faster. So, um, I agree with you. Timing it's almost impossible. Um, but at the rate we're going, maybe ten years might be a long shot or a long time we'll see. Yeah, definitely possible. I don't know. Cool, well, good stuff, phil If. I appreciate you taking the time to go through that. Um,

Like I said, there was a great book. Anyone that's listening, you should just go read the book on your own. There's a a lot of good stuff. We can't sum it up in forty five minutes here. So Philip, I know you're I guess where's you're on? Twitter? Obviously you posted this on there. Is that the best place for people to keep up keep up with you or anything? Um? Yeah, I have a substack that you can find on Twitter.

I'd say Twitter is the easiest place to start. Phil J Banello, UM, yeah, cool, and we'll link to that in the show notes for everybody. So Philip, anyway, thanks for thanks for joining today. Thanks a lot market It's fun. Hey, if you like this episode of the Market Disruptors Podcast, please help us take this to the top of the podcast charts. Just please do me a favor and rate, review and subscribe. Taking fifteen seconds to just leave a quick review goes a long way in helping us reach

more people and disrupt more markets. I really appreciate you listening, and I'll see you next time on the Market Instructors podcast.