Max Keiser - Bitcoin, Bernanke, Buffett: Why Bitcoin Is The Answer To Centralised Finance

Full transcript: Max Keiser on London Real

1:06 This is London Real. I am Brian Rose. With me today is Alessio Rastani, the Robin Hood of Wall Street. Some say he’s known to the world first on BBC live television for telling us that Goldman Sachs rules the world. Max, did you see that seminal it in television history?

1:25 Unless you told the world the truth about Goldman Sachs, and the BBC was shocked. It was awesome. They were shocked. They looked around like, what, what’s going on? Who let this guy in?

1:36 Oh my God. Somebody called my lawyer, my accountant. It’s all wrong, it’s all good, it’s all bad. I love that one. You would have seen Alessio first.

1:45 We had him on the show. It was an episode I called Money Never Sleeps. You guys get the reference to Wall Street. Yeah, that’s before, that’s really clever. Before the second movie.

1:54 Yeah, right? Really, thank you very much. Dr. Douglas, I know this is really a tough audience. It’s a good, it’s a good episode. Thank you, of this show.

2:02 Oh, thank you. It goes into the truth. Thank you, the truth. Truth. Timeout.

2:09 And with us today is Mr. Max Keiser. Could you be of any doubt? He is an American broadcaster and filmmaker. Um, he hosts Keiser. We started, yeah, yeah.

2:20 All right, great. Uh, you host Keiser Report, which is a financial program a broadcast on RT, formerly known as Russia Today. Yeah. And, uh, three times a week, I think. Yeah, you’ve done your notes.

2:32 Well, you know, thank you, homework. You’ve, uh, three times a week. You’ve presented for the BBC, um, Al Jazeera. You write for The Huffington Post. Blah, blah, blah.

2:40 Welcome. Thank you so much for coming. Great to be here. It’s a pleasure having you, Max. Yeah, it’s fantastic.

2:45 You know, I say we get straight to it. Gentlemen, let’s, uh, let’s hustle out the window, because while we’re here is to talk about what is a Bitcoin really, and why do we care? Max, I thought we were going to start off talking about Martha Stewart, because Alexis has his copy of Success magazine. Hold that up. Right?

3:04 With Martha Stewart. Yeah, you know, and this is, you know, it’s good magazine. Yeah, they’ve changed their remit a little bit this. Now it’s about success, getting out of jail for any reason. I thought my show wouldn’t get hijacked.

3:17 What was I thinking? I mean, like, okay, who’s the former CEO of Enron, Skilling? Jeff Skilling. Okay, he’s success because they’re letting him out of jail early. Yeah, 10 years early.

3:28 He’s success. It’s a good lawyer, because he get out. He’s getting out of jail. So I also, you know, all the jails are privatized now. They’re owned by private corporations, so the great thing for that if you’re in one of these private jails, you can get out by doing a leveraged buyout of the jail.

3:43 She just borrow a billion or 5 billion or 10 billion, you buy the jail, let yourself out. Hey, walk out a free man, because you, you’ve, you’ve seen that’s the economy that we’re in right now. It’s all good, it’s all possible. I love that. There’s no limit to the amount of credit you can borrow at almost zero percent interest if you’re on the inside or on the right side of the interest rate apartheid wall, as I call it.

4:09 All right, I like that, and I want to talk more about that, and I want to talk about gold and silver, but right now we got to talk Bitcoin. Max, everyone says you’re the expert. I go on Twitter, everyone’s like, Max, Max, Max, Max. I know no one’s the expert on this in this town. I, I’m one of the few people that has immersed myself in Bitcoin.

4:24 Why did you choose Bitcoin, because you do a lot of other things too? Yeah, well, um, I guess it goes back to the early ’90s. You know, the early, when the internet first came around, and I was very intrigued by that. I was living in Paris at the time, and I picked up a copy of Wired Magazine, and I just immersed myself in the internet, and this was just before or at about the time that Netscape was going public, 1994. And this is right when, you know, the internet had been around for a while, but it was going to go through this explosive growth period.

5:00 So I was living in Paris, and I went to Los Angeles, and I just threw myself into the internet. You know, people in Los Angeles were very frightened of the internet. They didn’t want anything to do with the internet. They, nobody had email addresses. They laughed.

5:11 They said that’s a, it’s a, it’s a, you know, it’s a fad. It’s going to go away. And then we had the Blair Witch Project came along, which was really made, you know, Hollywood take notice, because it was made for like 60,000 bucks or 100,000 bucks, and it did 200 million dollars globally, and it was entirely internet driven. It was like six months before it opened, it had this grassroots internet-based campaign, and, and so now suddenly Hollywood got interested, but then they had the problem of intellectual property and copyrights and all that, kind of going up against their core business model of controlling the copyright at all costs.

5:49 But anyway, they took on the internet. The internet, of course, exploded in popularity, as such, and I created some technology around that, the virtual specialist technology for trading virtual currencies, and I invented the virtual currency, virtual trading, virtual securities, and a virtual trading platform, and has a patent on this. Is it U.S. patented? There’s actually now four patents relating to this. This is the Hollywood Exchange, the Hollywood Stock Exchange.

6:15 Okay, but still exists? Yeah, it’s eventually, it was sold to Cantor Fitzgerald. Okay, and then they moved the whole thing to the top floor of the World Trade Center about six months before 9/11. Wow. So, um, uh, it had a happy ending, I guess?

6:28 Yes. So, um, you know, that guy at Cantor, he retrieved, like, a statue he had on his desk from the 110th floor. It was like some piece of metal, and they brought it to him out of the rubble like a year later, and they’re like, here, well, I’m writing. You say, uh, this is a segue into my Bitcoin a little bit. Um, because I, I have a film project on one of my other projects, an internet project called Pirate My Film.

6:49 It’s a story about a Morgan Stanley broker who, when the first tower was hit on 9/11, he had a choice whether to stay and trade options on airlines and make a lot of money on insider trading, or to run for his life? That’s right, this is a real story. Well, I’m piecing together all these bits and pieces. I like it. All right, and um, so it looks like he chose to trade options, and then the second tower got hit and he’s dead, and those options were never collected.

7:16 It’s an encounter. Alex Brown, the five million dollars, the profits. I used to work at Alex Brown, and, um, so I know, for example, Buddy Krongard. I was, I met a couple of times. He was, he was working for the CIA.

7:28 He had been working for, um, Alex Brown, uh, so it was before Bankers Trust, bottom, uh, Deutsche Bank, Alex Brown. Okay. So, so they, um, there was a lot of a chatter going on between the CIA and Alex Brown leading up to the 9/11 attacks, so those options were skyrocketing in value, and the volume was exploding, so there’s a lot of chatter, whether, you know, there’s a lot of information being passed around, and people were trading on that information.

7:59 So he was shorting the airlines. He was behind the puts, essentially? That’s right. The same thing, yeah. Shorting the stock or buying puts, so they’re speculating on.

8:06 So the, the, those, as you now play, just, uh, you know, if you look at, like, for example, I was working on Wall Street during the morning, during the shuttle disaster, when it blew up, and we were right after the shuttle blew up. Uh, this was an ’80s, maybe ’86 or ’85. Yeah, ’86. And, um, Morton Thiokol was the lead contractor on the solid rocket, and, uh, the puts on that thing, you know, obviously you made a killing if you got in there quick enough. So while Christa McAuliffe is, you know, fish food all over the in the ocean, you know, the, we were in the broker firm, like, you know, buying these options, you know, making lots of money, but the options exploded in value on the upside, the puts in a way before the 9/11.

8:47 So you saw the same thing, like something blew up, but before anything happened, that’s how they were trading. So, that, so it says in the official 9 11 report that they looked into the trading, but it was at an official reputable firm, Alex Brown, so we trust them, and we’re not going to investigate any further, but even though obviously there was a lot of information being passed around, so I put together the story about this guy, and, you know, it’s a classic American story. Your life, you know, run with your life or make a few million bucks, you know, and everyone has to make that decision every day, now especially on the front line of capitalism, as such.

9:21 So he chose, you know, go for the money, and, you know, he didn’t make it out. Uh, reasonable decision. So he’s gone. What, do you thought he couldn’t make it up, because he never collected the cash. It’s in there, never collected, right?

9:33 So I assume he died. Yeah, so, uh, so he, he’s gone. So anyway, I have that project listed on Pirate My Film, which is a site which only accepts Bitcoin. So this is a roundabout way to get the Bitcoin. Um, and so it’s, it’s, it’s, it’s, it’s material that is um, a bit controversial, so it’s nice to have a Bitcoin-based currency to get involved in this, because it’s a lot of attributes about Bitcoin that are very attractive.

9:57 Similarly for my um, TV show in Russia Today, we have journalists, a couple of journalists went on, did stories out in hot spots in the Middle East and elsewhere. It’s very difficult to go and pay these guys when they, or if they need cash out in the field using the typical channels and bank wires and things like this, because they, they don’t have those facilities, or it’s very closely monitored. So to be able to fund them with Bitcoin was great, so we had some good stories, and I’d rather pay them, and they took payment in Bitcoin.

10:27 They did take them into Bitcoin. Yeah, when they’re doing investigative journalism in war zones and hot spots. So it’s a very practical, uh, in that sense. Um, so to bring it all the way back to my 1990s experience in Los Angeles and the internet, where Bitcoin is now, I would say it’s kind of pre-Netscape in its development. It hasn’t really had its coming-out party yet.

10:51 It’s just, uh, coming together now, and there’s, uh, it has, it’s, it’s divisive. There’s a, there’s a huge group of people that are supporting Bitcoin and, and think it’s got a great future. Then there are people who don’t think it’s viable for whatever reason, and they, and they are not supportive of Bitcoin. But I think that we’re going to see who’s going to win this particular debate. You know, time will tell.

11:16 Um, I’m putting money where my mouth is. So I have a private equity fund here in the UK that’s making now Bitcoin-related investments in startups. So we’ve got one, we, uh, we’re already invested in. We’ll have some news about this. Is the Karma Fund or is that different?

11:30 No, that was another that was another project I did a few years back, Karma Bank, which was a hedge fund tied to activism. Okay, this is separate than you guys. This is a separate idea. This is a new, a new fund, so a couple new adventures in Silicon Valley for some new companies in the last few days. Not big money, but like 2 million here, 5 million there, for Coinbase.

11:48 Yeah, is one of them. They just closed on 5 million. Coinbase, and what are they doing? Are they an exchange? Coinbase is, um, they do an exchange.

11:56 They also are involved in processing, merchant processing, and what’s called a wallet, so they store Bitcoin. So they have those three aspects of the business. I actually opened an account with Coinbase today. You did. Okay.

12:06 I did. How many Bitcoins do you own, Max? Well, I ended up owning a lot, because I ended up buying them, um, when I went to a conference in Prague, and, uh, I just started accumulating them in the two dollar, three dollar range, and I just actually have a lot of Bitcoins now that I don’t know where they are, because I lost the passwords. I don’t know where they are. Okay, but of the ones that I do know, it still adds up to a considerable amount.

12:30 And so the price action, what, you know, once it got over 45 dollars, you know, my Bitcoins on paper anyway went over a million bucks, so then, you know, then they were worth several million bucks. You know, now they’re back to being worth a couple of million bucks. So, but they’re now, what I’ve done is I store them offline, essentially, as paper. Paper Bitcoins, let’s call them. It’s kind of in cold storage.

12:52 They’re not on the web as such at this time, so it’s a lot safer. Then I’m starting off. It’s not converted to another currency. They’re not like in dollars somewhere. That’s right, but they’re not virtual.

13:02 They’re not like on the Silk Road somewhere. They’re in an account. That’s right. Okay, so then I’m also starting with a firm in Malta, uh, a new fund which is going to be basically an ETF, exchange- traded fund, which will be, uh, divided. It’ll be three parts: Bitcoin, gold, and silver.

13:22 So you, you, you have a, you have a way to, to, to, to participate in these three currencies. I think there’s a tremendous way to make a comparison between these three. You know, I know, um, um, I also want to Alonso, but I know that’s wrong, Alessio. I don’t know why it’s quite like Alonso too. It’s kind of old school, and silver bugs, or we’re positive, so, and putting these three together.

13:48 So let me just finish this, three, right? So the three of them, it’s an exchange-traded fund, but it’s going to be in through this Malta hedge fund. Um, so it’s gonna, you know, it’s not gonna be available like to us, and there’s a hundred thousand dollar minimum, et cetera. So it’s kind of a high-level product, but I’m going to be working on that, because I want to get the market cap for Bitcoins about a billion dollars now, and you know we’ve got to really get her up to 100 million, 200 million, 300 billion, you know, half a trillion if we want to get it, you know, competing with 4X and getting it out there, because a billion is nothing for liquidity.

14:20 Is it that’s right. The liquidity is an issue. Let’s even tell you how more on the Bitcoin front. Um, the friend of mine, can you give us just a quick definition? That was one of the questions most asked, and the Leslie, I want to get your thoughts too, but to a six-year-old or a 10-year-old, I don’t think you can explain to a six-year-old, but essentially, you know, the Bitcoin protocol, which is from Satoshi Nakamoto, you know, the mysterious developer or team of developers, doesn’t exist.

14:45 Does he? Well, I mean, that’s his name they gave, but yeah, it’s just mysterious. I mean, it’s like, so, so it’s, it goes back to cryptology and single-key cryptology, which is, um, essentially you’re looking for these extraordinarily large numbers to, uh, to create secure online cryptological prime numbers, right? Usually you’re factorizing integers to create these extraordinarily large numbers, and you need a lot of processing power to get those numbers.

15:13 So what the insight was, is like, what we’ll do is we’ll distribute that processing power to a network, and then we’ll reward the network by calling the solutions coins or money, and then you can distribute that money, and now you can use it as a currency. Um, and so now you have, and it’s limited to 21 million coins. 21 million coins will be created. It’s set to stop there, right? And, um, so you end up with, um, something very interesting, you know, as I said, I was involved in virtual currencies and virtual market making.

15:45 What you have here is a virtual scarce good, which is, which is new, which is something which is an insight that you’d have to give the developers of this credit for coming up with this, it’s a virtual good, but it’s a virtual scarce good, right? Because they count the number there are, and then I think it’s gonna, it’s gonna max out in like 2114, at like double the amount, something like that. 21 million, 21 million Bitcoins. I think there’s 11 million, yeah, right?

16:08 And it’s going to, Carter, and there’s, I think every 10 minutes there’s at the current rate, there’s 25 new Bitcoins, yeah, right? So they’re being created, and then they go through what’s called the triple accounting system, for every single transaction is accounted for through every node, or, uh, of the 20,000 quote-unquote miners in the system are verifying every single transaction, every single code. Okay, so it has a robustness to it on that front.

16:33 Um, and rough market price right now of a single Bitcoin, it’s 105, I think, dollars per dollars. Okay, I own two Bitcoins. I’m not as rich as Max, but, uh, I bought them the other day. I got fleeced on an exchange that was buyers only, and I didn’t even see a two-way market, even though I traded for so long, and I paid like 85 pounds for Bitcoin. I should have paid 71.

16:53 Well, no, the SE vulnerable spot to the whole Bitcoin ecosystem. You know, the Bitcoin protocol talks about how to mine Bitcoin. It doesn’t talk about how to price a Bitcoin. You know, pricing Bitcoin, you need a market for that, and the market is, um, uh, you know, from my experience creating virtual markets, and I created the virtual specialist technology, you know, I can see where you could, you know, you have to create depth in the market. You have to create liquidity.

17:18 You need, you need a counterparty to this market, which you don’t really have right now. The exchanges are just matching buyers and sellers. They don’t make a market. What I mean by that is that on the New York Stock Exchange, I can go down there and I can sell ten thousand, fifty thousand shares at the market, guaranteed. Now, my price might not be great, but they will guarantee a price, because if there’s not enough of the volume to offset that trade, the specialist acts then as a principal, right?

17:44 Not just as a broker, and they go into their own inventory, and they put their own capital at risk to make that trade happen. There’s nothing like that in Bitcoin, exists currently. Now, I went to these guys in Malta and I said, I want to borrow 10,000 Bitcoin to be a market maker in Bitcoin, because I want to be able to offer liquidity in this Bitcoin product, and you know how much would you charge me to borrow, uh, ten thousand, twenty thousand Bitcoin?

18:07 And you know, they came back with a rate of like 250 percent, which is obviously totally uneconomical, and that doesn’t work. Pull that out of the air? Yeah, I mean, that’s, but if that’s where the market is to borrow to create a liquid market, then that’s, that’s, that’s going to be an issue going forward. There’s another, uh, startup called, um, Coinsetter, which just got, uh, their seed round of financing. There’s some banking guys in there.

18:30 I believe that they’re going to try to come in with some solution to this. I am now involved in a new project called Trade Four. Okay, the number four. Trade Four. I want to talk about that.

18:42 I just want to talk about liquidity really quick, because Alessio knows all about liquidity, because you only trade liquid instruments, right? Specifically, S&P futures, S&Ps, uh, other forex markets are pretty liquid. Euro dollar. Okay. Which Max, I mean, those are the most liquid markets in the world.

18:57 Maybe, except for spot FX and things like that. Well, I mean, I filed Alessio’s work. I mean, he’s a technical trader. He’s a momentum trader, and he’s, you know, he’s an active trader. And so for Bitcoin, it’s such a nasty and currency at this point that you can’t really look at it.

19:11 People say, well, the chart on Bitcoin looks great, or looks terrible. That’s an absurd statement. You can’t say it has any chart, really, chart pattern, right? Because it’s like saying you know, a fetus is only two days old, and saying that he’s being a great attorney. I was like, I don’t, you know, it’s only two days old.

19:28 There isn’t sufficient history. I agree with you. Yeah, I called Ikabanason to send me a chart on Bloomberg. Bitcoin. I have actually a chart here.

19:34 You do. Brought it with me, because he said there was nothing. Can you just hold that up? Yeah, sure. I’m not very good, but now, as Max said, it’s so, be a liquid.

19:41 Where did you get these dates, these price points from? I think personally, I think the main reason why so many people are talking about Bitcoin, this is what’s worrying me, because I’ve lost count of how many emails I’ve had, Brian. Max, last month, from folks asking me, hey, let’s see what if you have Bitcoin, Bitcoin, you know, what, and I gotta be honest, and the, the main reason why it’s caused such interest is because of this. You know, this is, um, as Max was saying earlier, you’ve got a massive jump from 40, 30, sorry, 30, 20 bucks, going all the way to 260.

20:11 Was this April 10th? Was this right? By April, that’s right. Yeah, it was just massive. Crash all the way down to it was like 266, 76, back to 160 within six hours.

20:21 They said, sure, but if there’s no liquidity, I guess things do move. Right? Well, there’s all kinds of, uh, sorry, go ahead. No, well, basically the thing is, this is what’s caused all the buzz about it. It’s what people ever talking about.

20:35 As soon as people think, oh, okay, there’s a way I can make, get rich quick on this currency or on this market, that’s what people are, people are essentially, are, um, uh, driven by their emotions, and the idea of making hyperbolic returns like that in a few days or a few weeks, it’s obviously appealing for a lot of, I would say, perhaps new, uh, new traders, or maybe inexperienced, uh, folks. Apps. So we wouldn’t sit here, be talking, if there wasn’t that volatility.

21:02 A couple months ago, I don’t think so. I, I put, I put it, if Bitcoin was just going sideways like that, I cannot imagine people be talking about it right now, because there’s plenty of other things that could be put in, three or disagreements. I agree, but price breakouts to get the attention and to get people into it, and trading is speculative and risky. Yeah, I will say this. Still, listen, I mean, we can sit here and talk about Bitcoin uh, till we’re blue in the face, and we can say Bitcoin is going to be the new currency.

21:35 This is, there’s a massive liquidity problem. There’s all kinds of issues. Given all that, we can talk about it for hours and days, maybe months. The biggest problem is not so much whether what Bitcoin is going to be, whether it’s going to be the new revolution on money. The biggest problem right now is this, and I brought this with me, Brian, to show everybody, with Martha Stewart again.

21:55 No, it’s not. I guess I’m Martha Stewart. Jesus, it’s worse than Martha Stewart. It’s a front cover of The Economist. For those of you listening to this, you can’t see it, but front cover, Economist magazine, last week I actually bought this just to show people.

22:06 It says on the front cover, it says, “Generation jobless.” Okay, the problem is not Bitcoin, uh, and what it’s going to be. The problem is where Bitcoin is going to go, whose pocket is it going to go end up in? Right? The biggest problem is going to be the imbalance of power, imbalance of wealth, because, okay, let’s say Bitcoin does double in value.

22:26 Let’s go. Bitcoin does bubble into something new, and people make money. The bottom line is going to be who’s going to have much of Bitcoin and who’s got less, and you’re saying it’s the young kids that are going to control the majority. According to The Economist, it’s saying that, uh, 300 million young people right now are out of jobs. They don’t have, uh, dictate.

22:46 There’s no, uh, essentially they don’t have any careers they can get. They can’t find work. 300 million worldwide. Situation’s worse in America. Situation is also pretty bad in Europe as well.

22:56 And this is what’s, I think, this is what’s important right now, folks, because if you’re watching this, you know, somebody here says the global rise of youth unemployment is almost on the cover. And I find this. This is a, this is I mean, I’m not a socialist. I’m not a communist or anything like that, but it’s probably kind of a strange thing for me to say, but I do find it, uh, very, I do hate injustice like this, when there are folks, when there are young people coming out of university right now.

23:21 I just, about a couple of months ago I went to the university of Groningen in Holland, a very prestigious university, and I warned them, and I warned the people at that university. Look, don’t just think you’re going to come out and find yourself a job. Um, if you’re, you’re lucky if you do, because most companies right now are not hiring. But the problem is people are focused so much on getting a job, and job really stands for what it stands for, just over broke.

23:47 Basically, what the problem is, that young people are not being educated how to make themselves financially free. Okay, now I understand what you’re saying. So you’re saying the kids are going to control this currency, Max? There’s no Fed on this currency. They can’t lower and raise rates.

24:01 They can’t print money. Is that a good thing? And then we’ll tie it back. What do you do? You agree with Alessio?

24:05 Do you think this is the new kids’ monetary system that we can’t control? Well, yeah. macroeconomic dimension of Bitcoin, and as it relates to jobs and global jobs, and, um, so in that context, I, I would, I would kind of look at what Alessio was saying about the joblessness in the world today, and I would uh, posit that we need to look at what’s happening at the central banks, because the central banks are keeping interest rates near zero percent, artificially low, and why are they doing that?

24:47 They’re doing that in large part because it’s cheaper for speculators to speculate if their cost of borrowing is as close to zero as possible. And but it doesn’t help people with capital in their bank account. Savers, savers are being penalized. In this country alone, the money that’s saved by having these low rates through quantitative easing from the Bank of England, through, let’s say, instruments like mortgages, where people obviously, through a tracker rate or if you have a lower mortgage rate, and you’re saving money because rates are down, if you add all that up, that means that in Britain there’s a 70 billion pound savings due to quantitative easing.

25:23 But then look at the other side of the ledger. How, what’s being lost from savings accounts, how much money is not coming into the economy because people are being penalized by artificially low rates? Well, that number is 210 billion pounds. So for every pound they save through artificially keeping rates low, to do nothing more than help speculators borrow money, they lose three in real capital that would be coming into the economy, and that real capital coming into the economy would be helpful in boosting the economy in ways that would boost jobs.

25:56 So this, this lack of jobs is tied to what’s happening on that central bank front. It’s happening with the bailouts. It’s happening with a lot of corruption, and so savers are penalized, and, uh, the job market’s being penalized. Look, look at Apple computer for a second. Here’s a, here’s a company that everyone says, oh, this is a great company.

26:15 They outsource their labor to China. They make billions and billions of dollars outside the United States, if they were to repatriate that money, they’d have to pay taxes, but they don’t. They’re going to instead raise a bond through Wall Street using artificially low interest rates near zero percent to raise 50 billion dollars to pay a dividend, to buy back their own stock, to reward the executives and reward the shareholders. The jobs are in China. The savers are getting screwed.

26:42 So they’re, they’re not an American company. You know, they think they’re an American company. What’s American about that? They’re screwing these people. You know, these, the margins on the iPad are five, six, seven hundred percent.

26:53 They could easily, uh, be making iPads in the United States and, and giving jobs. If you know, and and I would say that three or four weeks ago, and people would say, well, you don’t understand. Steve Jobs said that he could never recreate what he’s created in China. America is never going to get to the point where they can do these manufacturing jobs that these Chinese people can do. And then three weeks later, they come, he’s dead, he’s gone.

27:17 The current management says we’re going to raise a bond to, uh, so we don’t have to repatriate this nine billion dollar chunk of cash. Now, is that going to go into the economy? Is that going to help pay off the multi-trillion dollars with the debt? Is that going to create capital formation? Are you saying Bitcoin would, since it’s not going to have a central bank and not going to have this artificial regulation, is the, what the currency?

27:38 So then, so then we go to Bitcoin. So now, so I’m saying, is where the central banks are, are, are doing, are involved in policies that are self-serving for themselves and the people that are closest to the central bank? Quantitative easing and these other policies directly benefit those people who are closest to the source, which are the bankers. They get the first crack of the money, et cetera. So in There’s a lot of outrage with how the financial engineering around the world has produced this permanent state of joblessness, and in that outrage, we’ve seen a few different things.

28:13 We saw Occupy Wall Street. We saw a campaign I did called Crash JP Morgan Buy Silver, right? You know, JP Morgan has a huge silver short position. You take the physical off the market, uh, you pressure JP Morgan into that vacuum. And, uh, Satoshi, the mythical figure behind Bitcoin, he says, you know, he did make some comments before he disappeared that he had huge objections to the banking system, the way it was constructed, the way it worked, and this was his answer to try to take it to another level.

28:41 So the central banks and these corrupt bankers, lawyers and accountants created the vacuum, and into that vacuum have come these different expressions, either social protests or a campaign like mine, which tries to mix, you know, activism and capitalism, and then this new currency, this new virtual currency, which I think, from the reaction we’ve seen now from the establishment, they understand that there is something to that, that is threatening to them. Uh, you know, Bart Chilton at the CFTC, who for some reason was presented with bold-faced facts about manipulation in the silver market. He’s given the smoking gun, the proof.

29:19 This Bart Chilton is this regulator at the CFTC. He’s this big thing. He comes out there and he tries to, you know, jiggle his, he has little pasties on, and he’s rather be a stripper, but for some reason he’s a regulator. Okay, we gave him a smoking gun, evidence on silver futures, but he said, oh, I don’t know, I’m not sure, I don’t see anything, I’m blind, I can’t see anything. Box office futures contracts, which is based on my technology, the virtual specialist technology, at the last minute the MPAA lobbied him and said, put in the law for a Graham Dodd not to outlaw box office futures contracts.

29:54 The Hollywood industry is the only industry in America that’s protected by law. You can’t have futures contracts. Every other industry gets f***ed up the ass from betraying futures contracts, the food industry, the finance industry, the housing industry, everyone’s dealing with Wall Street, their derivatives, the speculation of f***ing up the ass, but Hollywood, no, it’s against the law, all because Bart Chilton is a corrupt f***ing s*** and if I stand by the street, I can rip his f***ing head off.

30:18 Okay. That’s Bart Chilton, and Bitcoin will save all this. So with Bitcoin, he suddenly comes along. He goes, he’s like, oh, it’s a problem, it’s a problem, it’s a problem. Well, when did he grow brains?

30:29 Suddenly, some, you know, Jamie Dimon needs to take his hand out of Bart Chilton’s [expletive]. This is the president of JP Morgan. Yeah, and let Bart speak for himself. You, you suck, Bart. You suck.

30:40 Don’t, don’t knock that camera over. All right, so, Max, you’re saying that that’s the, the regulators are collaborating with the bankers, and then who knows, maybe the guy’s on the Fed, and you’re saying this thing takes them all out of the equation? Bitcoin into the vacuum, because that way they’re scared of it too. Well, they’re scared of it, because they are, they can’t, uh, manipulate it the way they manipulate everything else. They can’t regulate it the way they’re not regulating everything else.

31:04 It is a true supply and demand currency in a lot of ways, which they don’t want. Supply and demand. If there was true supply and demand in the American interest rate market, in the bond market, interest rates would be five or six percent right now, not, not one and a half percent, or whatever it is on the 10-year bond. There’s no supply and demand. You’re gonna have Paul Krugman writing an editorial in the New York Times where he gets on his knees and he flakes Ben Bernanke in public.

31:24 It’s not the most disgraceful thing as an American. I cried. So here’s the New York Times, and I need the knee pads, and he’s got, he’s justified. He’s got Bernanke’s ball slapping his chin. These gobbling Bernankees, glue.

31:37 He’s saying you have to trust the chairman. The chairman is God. I mean, Paul Krugman, does your wife know that you’re into Bernanke like that? You’re a disgrace, my friend. All right, let’s get your opinion on this, not on the, uh, the homosexual active question, but do you agree that these rates are artificially low?

31:54 Do you agree with what Max is saying? Um, probably. But the thing was happening right now, what’s interesting right now is that folks who are fed up with those low rates or getting nothing, they’re getting Jack on their savings and their bond investments, uh, they’re now, Mike, it’s called The Great Migration. Now Wall Street is calling it the Great Migration. Um, we’ve seen the Dow, for example, hitting 15,000 recently.

32:16 Yeah, uh, and with all new highs. That’s right, all new highs, and, uh, this being broadcasted on media, financial channels are talking about it. What’s going to happen right now? And as Max was saying, people are fed up getting those ridiculous, pathetic rates they’re getting, uh, no returns on their money. I mean, compared to inflation in the UK, I mean, you’re [expletive].

32:34 That’s right. Right? I mean, why would you put money in a savings account? Right? And what’s happening is people are now wising up to the fact, oh my God, I’m missing out on this opportunity in the stock market, where the stock market is making new highs.

32:46 I can’t miss this. I can’t miss out on this, and the biggest mistake is happening right now. We’re just ordinary people, ordering, monpa, you know, investors, regular folks are not, sorry, are not going to be, uh, racing to the stock market in droves, so I would actually be seeing the stock market going a lot higher in the long, in the, uh, medium term, and by the end of this year. All right, um, I still want to wrap this whole Bitcoin thing up before we talk about gold and silver.

33:13 So let me just follow up on this point about the stock market, 15,000 on the Dow Jones. Okay, so it’s a new all-time high. So has margin debt so it’s dead. Okay, if you were associated, okay, okay. What, what percentage capitalization, for example, in quantitative easing, with the capitalization of the balance sheet of the Federal Reserve Bank?

33:34 It’s one for one, just because the Federal Reserve Bank expanded their balance sheet to now it’s three and a half, four trillion dollars that they’ve injected into speculators’ hands to go and leverage that by 10, 20, 30, to put trillions of dollars into the market, totally leveraged, on companies that are um, generating no, nothing really exceptional in terms of profits whatsoever. You know, somebody again, Paul Krugman makes the argument that, well, the companies are making great profits. According to who?

34:04 According to their accountants, KPMG, PricewaterhouseCoopers, Deloitte, the torch, who’ve been involved in every single scandal the past five to ten years. You know, Arthur Andersen. How come they’re not with us anymore? Because they cooked Enron’s books. You know who cooked WorldCom’s books?

34:17 Who’s cooking JP Morgan’s books? Is it, is it, uh, um, any one of these four accountants? The four accountants say they’re making money. They’re corrupt, just like the fund managers, and just like all these other guys in this circle of death. You know, the thing is, Max, still, I mean, let’s, the thing is that even if Bitcoin was to become accepted as a form of currency, eventually that whole corruption is gonna infiltrate Bitcoin too.

34:43 But I want to ask a question now. So now, now, FinCEN, which is the Financial Crimes Enforcement Network in the U.S., yeah, in March came out and said if you own Bitcoins, you’re not, um, a money launderer, you won’t worry about, you but we’re going to watch the people that are exchanging it, right? I mean, basically it seemed like one step away from almost making them illegal. Now you own millions of dollars worth of Bitcoins. How do you sleep at night knowing that your virtual currency might drop to zero?

35:08 Like I said, it’s not a big, it’s not the biggest portion of my portfolio. It’s offline. It’s something that I don’t spend. It’s just accumulating. I have no gains to report, you know.

35:19 I have nothing. Not, there’s no taxable events, there’s no gains. It’s just, it’s just happened, like, uh, like a mushroom, grow in the dark, and it just sprouted, and there it is. Could it be made illegal in your mind? Is it possible for the US and the UK to, well, I think that, you know, you have to understand that the U.S. or the UK, or, and the UK, if they want to get aggressive on that side, it’ll just go to China, India, Latin America, Venezuela where the inflation is raging.

35:45 We see Bitcoin. Cyprus, where they have capital controls. We see Bitcoin in China, uh, which is, or or Vietnam, or these places, India, where they’re trying to manage the importation of gold. We’re seeing Bitcoin. So Bitcoin is showing up, and Bitcoin, uh, first of all, let’s say that it never goes back and forth in and out of a dollar or a fiat currency.

36:06 It just stays Bitcoin, stays in Bitcoin, people accepting Bitcoin, they mine Bitcoin. It’s a totally closed environment of Bitcoin, and it doesn’t interact at all with those other fiat currencies. That could be, that could happen, that would take a lot slower for the market cap to rise. I mean, I’d like to. I’d rather see 20 billion, 30 billion, 100 billion, you know, move into Bitcoin right now and get the price up to a hundred thousand, two hundred thousand for Bitcoin.

36:31 I’d love that, because with only 21 million Bitcoins total, these things have to rise in value to get any kind of reasonable market cap. Right? Is 21 million Bitcoins enough? I guess it doesn’t matter. It’s like a price of Berkshire Hathaway, it doesn’t matter how many shares.

36:43 Well, unlike Berkshire Hathaway, which they can print stock at any time, this is a closed the number of Bitcoins, but they’re famous for having, like, a one share being costing like a quarter million dollars, as in Yeah, 160,000 per share. I made a bet with Warren Buffett that Bitcoin will get to 200,000 per Bitcoin before Berkshire Hathaway does, and I bet him a large number of Bitcoin that it would do so. Okay. I haven’t heard from Warren yet. I don’t know why.

37:06 He’s with Charlie Munger. They’re, they’re probably with Ben Bernankees. All right, that’s horrible. All right, so it doesn’t matter. They’re 21 million, because it’s just pieces of pieces.

37:20 You can have one Bitcoin. They’re fungible to eight thousand eight decimal places, right? So the Satoshi is, I think, one ten-thousandth of a Bitcoin. That’s a Satoshi. Okay, all right.

37:28 The thing is, um, there are a lot of, um, Bitcoin enthusiasts who are saying Max is one of them. Um, probably. Yeah, I guess, but I mean, I haven’t heard of Max from Max himself. There are many out there saying that, um, Bitcoin is not going to be subject to the sort of printing, uh, easing, monetary easing we’ve seen in other currencies, built in the system technically. But basically I disagree with that.

37:53 I think that’s complete nonsense. I think just like any other form of currency, there’s no reason why they can’t increase the supply of it. And actually a lot of people who are in favor of Bitcoins seem to misunderstand. They think that because, uh, Bitcoin is electronic, that somehow when the Fed increases the money supply, they’re actually literally printing money off the press, which is not true. When they print, they’re actually talking about electronic money as well, but people think that printing literally means printing off the Absurd, the, uh, you know, the press.

38:26 But what I understand, the algorithm casts Bitcoin. But, you know, I mean, bottom line here, the bottom line I’m trying to make here is this. There’s one of the arguments people are not maybe making against Bitcoin is there’s nothing to stop someone else coming out and saying, hey, I’ve got a new and better version of Bitcoin. Right? Yeah, by my Bitcoin, it’s better than the old brand, and that’s going to be a major threat to anyone who owns Bitcoin or is thinking of making money in Bitcoin.

38:49 I got a friend of mine who recently just bought five thousand pounds, which is actually put a lot of money into, uh, information, more than that, into Bitcoin, and I warned her, look, you’ve got to protect what you have, you know. And this is what people, people are watching this right now should realize that before you think about, hey, I’m going to make a killing in Bitcoin, first of all, learn about how to protect what you have. Protect your assets.

39:11 The more you learn about markets and investing in markets, or any kind of investing, the more you learn, you’ve got to protect your assets, protect your bottom line. Risk management is the most important thing, right? And that’s the most important, with you on that. Now there are other alternatives like Litecoin, and there are some other ones out there, but I mean, can I respond? Yeah, yeah.

39:29 So, uh, I mean, as far as the Bitcoin itself, the threat of increased, uh, supply of Bitcoin, I don’t, I don’t see as, as a, a really, a, a threat that I’m worried about, but the idea of having alternative competing virtual currencies is definitely in the mix. There’s definitely other of these cryptocurrencies out there. I believe there’s over 40 right now, okay, that are working, in various, uh, that are working out. Litecoin is one of them, and there are others.

40:01 There are already many, many of these cryptocurrencies out there. They haven’t captured anywhere near the market share, uh, with, with Bitcoin. It has captured a huge amount of money, market share, and it has the hashing power, you know, it has the power of these 20,000 computers all networked together, which is an enormous, it’s the largest single compute, distributed computer project in history. It’s bigger now than even SETI, which was the search for extraterrestrial intelligence projects, where people were giving the CPU excess CPU bandwidth on their computers.

40:30 Over this project has now exceeded that project, so this is the largest distributed computer project ever in the history of the world. That, and the comparison to mining is really an apt one, because, as you know, when you’re gold mining, it costs a lot more money to go down deeper, and as you get down deeper, the costs get higher, then it becomes scarce. Same thing with Bitcoin. As you, the, you get deeper into this 21 million pool of Bitcoin, the computer power is increased, uh, the, the, in the installed, uh, negative cost of having all this happen is already behind us.

41:04 So it’s the, the hurdle to overcome this and to compete with it, it gets higher, higher, and higher and higher. It’s like saying there are people actually mining coins right now. That’s hard to get my head around. That’s right. They’re using technology to mine 25 coins every 10 minutes, yeah, and they’re getting them, and now they have Bitcoin value.

41:20 I mean, once it has kind of an entrenched position, it’s, it’s going to be very, very difficult to knock it off. So I mean, it’s hard to come out with, I mean, anyone can come out with the, the cola product, but are they going to take Coke, knock Coca-Cola off the, uh, the number one product? It’s doubtful. Bitcoin, to, like, Virgin Cola. Basically you’re saying Bitcoin, who’s, who’s one?

41:40 I mean, Bitcoin is becoming the, the de facto standard, and now is all this venture money, venture capital money, comes in, it adds to that story, so I think I should call it Bitcoin. Well, you should talk to Satoshi about what I mean. Maybe Coca-Cola isn’t the best example. I mean, you had Apple come out with the iPhone first, and then we saw Samsung has taken a major step ahead of Apple. I mean, with their sales, sure.

42:04 So I mean, maybe Coca-Cola isn’t the best example, but anything can be copied. Yeah, and Netscape and internet experience, and let’s face it, that kind of thing. But let’s listen, in that, the, the ability to solve these ever-increasingly more complicated, uh, numbers, it requires this huge distributed computer network, so it’s, it’s really unique in that sense. You can’t just come out and, and, and, and knock it off in that way. So I think the comparison to mining, or gold mining, is really the one you have to do.

42:31 It’s not like, I mean, I made the comparison to Coke in terms of its ability to dominate its space, but I think to compare it, you have to compare it to, it’s it’s unique. What I call it is intrinsic value, which is, I think, of all the things I’ve written about in the Bitcoin space over the past six months, there’s two things I’ve written about that people have written, you know, back and said they disagree. I’ve said it has intrinsic value, and then I’ve also written, which people said has no, I believe it does.

42:55 People say it doesn’t, because the algorithms, yeah, because in comparison to mining, right? And then, um, why not? That’s the second thing I wrote, was that, uh, was that I said should there be a, uh, a dollar peg to Bitcoin? So now, this, like, the Bitcoin community freaked out about this, because it goes against every, every, every single, the ethos of, but they didn’t read my whole piece, really. They just looked at dollar peg, and they just, they went ballistic over this.

43:23 They didn’t, I mean, I was coming, this is, there’s a, there’s a hole to this argument. There’s a lot of pieces to it that nobody was really getting into, but they just, they just triggered an explosion of, you know, oh my God, how could you say that? But anyway, those are the two things I’ve written that have been in the Bitcoin community itself. There’s been some, some, some outrage. Well, yeah, those are strong statements.

43:44 I mean, you don’t like the fact that there’s intrinsic value. They say the gold doesn’t have intrinsic value, because these days there’s better superconductors. People don’t need rings, blah, blah, blah. Gold. I mean, gold is a real, you know, you’ve got something real, hold in your hand.

43:57 Uh, what I’m trying to point is, I mean, why not, Max, say, well, instead of, here’s my argument, here’s my, here’s my issue, why not just say, hey folks, instead of putting your money into some electronic currency, it doesn’t exist, why not just go and buy an ounce of silver? And as a silver, right now it’s 23 dollars, and it probably gets cheaper as well in the short term. Um, that’s real money. I mean, silver is real money, gold is real money. Why not just go buy it?

44:20 That’s why I’m launching this fund, which is going to be Bitcoin, gold and silver. Okay, so you’re dividing it up into these, into these three categories. I’m making this thing. Here’s a comparison, but I’m saying, to be prudent, spread it out over what I consider to be the other forms of money out there, gold and silver. I think you’re doing the right thing, because I mean, you said earlier that it’s only part of your portfolio, probably a small part of your portfolio, putting into Bitcoins.

44:43 I think that’s probably something a lot of people who are maybe listening just might have, uh, maybe, maybe they don’t pay attention to that point, which is professionals like, uh, Max, myself, uh, and you’re Brian. I’m back in the day. Yeah, well, we, you diversify as well. You diversify and make sure that your portfolio is balanced, and the riskier assets must be kept, uh, you know, a lower percentage of your, uh, overall. But of course most people out there probably won’t get that.

45:10 And, um, people who already new to trading, or maybe are inexperienced, they probably, what they usually do is they put almost all their money right into, uh, something like, I have an important question. One of my Twitter guys hit me back and he said Bitcoin will exist as a real and viable currency, because derivatives aren’t involved, and I tweeted back and said, okay, I promise to pay you in two days for a Bitcoin at a pre-approved price. That’s a derivative.

45:33 So are there going to be derivatives on Bitcoins, and is that the reason it will or won’t succeed as a currency? Max, well, look, look at, look at, for a second, what is the price of silver? 23. What’s the price, what’s the price of gold? I don’t know.

45:47 It was last time I checked, it was like 1,460. Okay, how do you know that? You know that because you get the price from the futures exchange. You don’t have a cash price for gold, because there is no cash price. They have gold.

45:59 We only know the futures price of gold. We don’t know what the cash price of gold is. We don’t know what the cash price of silver is. There’s only the futures price, with the paper price. That’s the price, uh, so that’s the derivative.

46:11 They don’t, we don’t know what the underlying prices are, and we don’t need for underlying. I mean, the real price, when it’s physically delivered. There’s two kinds of growth. I’ll sell you my silver right now for 40 dollars an ounce. The paper price is what, 27?

46:28 That’s nonsense. I’ll give you for 40, because I know that it’s in backwardation. The spot price, the real price, is higher than the futures price. That’s the real price, but that’s not published, because that’s part of what we were talking about earlier, about this, the relationships, and it was, unless he was talking about with the joblessness, you know, the macro economy, the problems there. One of the biggest problems is that we don’t have a real, legitimate price for gold.

46:51 So now Bitcoin, um, is the cash price. Okay, that’s the supply and demand price. The derivatives that would come on top of Bitcoin would be the derivatives price. It wouldn’t be a bad thing to have three-month futures on Bitcoin, options on futures on Bitcoin, because, you know, I argue that it’s no. The derivatives are no problem at all, as long as you have a cash price, which is the current price, that that’s the current supply and demand price of Bitcoins.

47:14 It’s a crappy market. It’s illiquid. The Mt. Gox in Japan has 80 percent of it, and they don’t know what they’re doing. They don’t even have a legitimate market. It’s just a matching matching service for buyers and sellers.

47:25 There is no depth at all, and that’s where we are in the Bitcoin story. This is like a Bitcoin exchange. It’s an empty box. I think is what it is that you’re talking about. Well, you know what’s exciting is on the payment front, you know, the payment front.

47:37 So you have a couple of companies that are very involved in payments. This guy in San Francisco recently spent a whole week of his life and lived on Bitcoins. Yeah, and he had a hard time, because he could only do a certain things, but he actually managed to live and eat, thousands of merchants are now starting to accept Bitcoin. I haven’t seen one in London. There are a few, uh, but that, you know, I want, as I get more active here, I’m going to be more proselytizing the benefits of Bitcoin and getting it out there more.

48:03 And it’s just like guys like me, the foot soldiers, are going to be out there, you know, get, except Bitcoin. Apparently there was a de facto exchange in Union Square in New York the other day, where guys were out quoting just like they used to on Wall Street, underneath the tree, 200 years ago. Yeah, and they were buying and selling Bitcoins, and then whoever bought it, the guy took a picture of the alphanumeric code, and they transferred to Bitcoin. Yeah, well, that’s, that’s, that’s legitimate, Mark, because there’s no exchange market.

48:25 Now you can go to a cash market here in London. You, you meet, you meet up and you swap Bitcoins in a cafe, for example. Really, your article in The Huffington Post said that until we can have exchanges, this is like beaver pelts, because since there’s no, because they’re just trading, we don’t know what’s going on. Everyone, every other price is negotiated on a per-transaction basis, and then you say, well, the last 30 transactions have been at a certain price, so we’ll say that’s the price, but that’s not a market.

48:49 A market, because most merchants probably don’t want to take on Bitcoin if it has so much volatility and illiquidity, which we’ve been talking about, so far, until the liquidity problem and the volatility, huge volatile movements, are solved. No merchant wants to have anything to do with Bitcoin. Just the fibers, or the bid offer, as the price goes up, which is a good reason to get the price up. Then the relative tail price distortion, or like elasticity as a percentage, will become smaller.

49:14 I believe that would be the alpha of Bitcoin, would shrink as the price goes higher. So if it’s Bitcoin at 11,100,000 per Bitcoin, if it’s up or down 100 bucks on anything, on a percentage basis, that’s nothing. Okay, let me talk not about an elephant in the room, but there’s something called the Silk Road, which is this underground internet where you can buy everything. It used to be assassinations, but they outlawed it, but illicit drugs, you name it, and you use Bitcoins, because it’s a, you know, it’s an anonymous source of cash.

49:42 Is this a small part of the Bitcoin market, or is this something that will keep the regulators on edge and potentially ban it? Have you been on the Silk Road? So, so Silk Road, uh, you can buy drugs with Bitcoin. Is that, is that what’s going on? Yes.

49:54 Okay. So, so let me ask you something. Yeah. I’ve been on the Silk Road, uh, I may or may not. Fair enough.

50:00 No, I’m not. That’s a lot don’t let my sit inside. Um, he’s high right now. Jesus, that’s why he wears a suit and ties. I actually heard from a friend of mine, um, that in Zurich, yeah, in Switzerland, Zurich, possessing cocaine is not illegal.

50:25 I did not know that. Yeah, apparently I give away heroin too. I think apparently a friend of mine told me that having cocaine is so accepted in Zurich, Switzerland, that practically it’s, um, not illegal to possess. We were talking about Silk Road. Yeah, you see that’s a good point, because he’s high.

50:45 He’s high. No, I know. I am a tangent. Coke or LSD? I’m not.

50:49 Don’t do drugs. All right, but it is something we have to address, because, no, I’m gonna. Okay, yeah, right now I was addressing that part. They, uh, okay, so Silk Road, Bitcoin buying drugs. Okay, let’s see.

51:04 Well, let’s, let’s talk about HSBC. Okay, there’s a bank. They were caught laundering eight billion dollars of Mexican drug cartel money. Yeah, yeah, yeah. They, they don’t deny it.

51:15 They, they paid maybe a little fine. Um, 60,000 dead Mexicans. War on Drugs, because of money laundering. Thanks to HSBC, Mexicans with their heads cut off, rolling down the street, because of HSBC. The one of the biggest money-laundering outfits and drug, and the drug supporters in the world.

51:33 Okay, so are they the biggest? No, there’s one even bigger. It’s called Wachovia Bank. They were caught laundering 400 billion dollars in Mexican drug money. They were bought by Wells Fargo, which is now their biggest shareholder.

51:45 Is Warren Buffett, at Warren Buffett’s annual meeting, where he’s playing little ukulele, singing about Charlie Munger’s [expletive] he’s gotten us now. Did he happen to say, oh, I just bought Wells Fargo? They laundered lots of drug money. Mexicans are dead. Happy me, I’m Warren, happy Warren, happy Warren.

52:02 I kill Mexicans. No, he didn’t say that, did he? No, but he’s complicit. He’s complicit in their murder. Is complicit in the gun running that goes between America and Mexico.

52:11 He’s he’s a terrorist, and I don’t use that term loosely. Warren Buffett is a financial terrorist. George Osborne is a financial terrorist. The heads of Bank of America, HSBC, Barclays, Lloyds, Royal Bank of Scotland, they are financial terrorists. The fact that George Osborne allows terrorism right here in London, unchecked, just running amok in the city, is unconscionable.

52:32 It’s tyranny. The people in this country should be outraged. They should do what they have to do to get restored justice, and whatever means necessary is what I leave it up to their imagination. Okay, so your point is the Silk Road is a tiny little speck. It’s fly s*** in the pepper.

52:50 Okay, it’s meaningless. And besides, every technology is supported by drugs and sex. Even the Bible starts out with a pornographic story about Adam and Eve. Every single technology, the VCR, the videotape, the DVD, the CD, it all starts with sex, porno, and drugs, rock and roll. It’s all about sex and drugs.

53:07 It all, this is the beginning of everything. It’s always about a man and a woman getting together and rocking and rolling. It’s the Genesis of us all. That’s what the hell happens, and this Bitcoin is the same, and Satoshi is cyber Christ. He’s the virgin currency.

53:20 He’s come from planet A, parallel universes, to save us, and Ben Bernanke’s gonna get f***ed, he’s gonna get f***ed, he’s gonna get. See, Max, you forgot to take your medication today? No, I think he took it. I did take it. That’s awesome.

53:34 Uh, Max is right. Every new technology has always been brought along with porn and those industries, you know, any, you know. So I can’t disagree with you there. Jesus Christ. Whoa.

53:44 And now he’s off. Um, all right, I have to quickly ask, and then we’ll move off. Move off Bitcoin. Uh, will there be some type of open source, you know, person-to-person exchange? Well, we’re finally gonna sort this out, as opposed to these companies that are just goofing around in Japan like you’re talking about.

53:57 Will you set up an exchange for us, Max Keiser? Oh, well, I, I was in touch with a couple of guys, young guys here in London, who want to start an exchange here in London, and, um, but you know, they don’t seem to want to go down into path of exploring the issues that I have brought up in terms of these, these issues of liquidity and market making. But they, being young guys, said, you know, the healthy pops, you know, we’re gonna just forge ahead. So my current understanding is that you’ve got these two guys that are forging ahead.

54:29 They’ve got our office in Farringdon somewhere, and they are going forward to create an exchange here in London. I guess I’m consulting with them on some basis. Um, so I like my project now, which I mentioned earlier, which I’m going to plug. It’s called Trade Four. Yes, yes, we can get to that.

54:48 Trade Four is a new gamification of Bitcoin. Okay, where the, the coins are going to be essentially represented by coupons, and the coupons are going to be tied to giveaways from entertainment companies, and the coupons we can make the market and make some liquidity in the coupons, based on a Bitcoin, easier than we can on the actual Bitcoin. So these coupons will trade on this exchange platform, and people will be buying and selling the coupons, which will be up and down with the volatility.

55:18 So it’s a derivative in a sense. It’s a coupon, it’s a derivative on the actual. I do this with stocks in London all the time. Yeah, so it could be like, um, index, what are they called, spread betting, or, or, or a derivative of this, but it’s a coupon tied to a product that has a certain lifespan, and at the end of this, the coupon’s expiration date, if you own the coupons, you can cash them in. So this is, this is, this is the gamification of Bitcoin.

55:43 So it goes back to my, my roots, you know, as a Hollywood Stock Exchange, where we took Hollywood and created a trading platform or a game based on using box office as the, as the currency and as the main economic component of that economy. So this is kind of getting back to that, but using all Bitcoin, and through that gaming aspect again, you know, gaming is a way a lot of things become very popular as well, so that could also add to the liquidity. Yeah, but people will buy Bitcoin and swap it for coupons.

56:11 Now they’re trading the coupons that are tied to Bitcoin, but the volatility is a good thing, because it means that they could be making or losing. It’s tied to the volatility. I’m saying it’s not their actual. Once they buy the coupon, the volatility is the game. So they don’t, their, their risk is, is limited to the, the amount they swapped into the coupon.

56:29 Sounds like they’re trading bull. Here’s what I’m gonna say. I’ll make a bet. Let’s have an interview this time next year. I guarantee you nobody’s going to talk about Bitcoin really.

56:40 Okay, if anyone, that it’s a bull, it’s a bull, um, but why don’t we do a forward contract right now between the two of you and Bitcoin? Well, here, they’ll take the commission. Let me explain my point. Look, here’s the thing. Everyone’s talking about Bitcoin right now.

56:53 When everyone’s talking about some subject. I mean, two years ago it was all about gold. Um, let me know how that ended up. But the bottom line is everyone’s talking about Bitcoin. This, this makes me nervous.

57:01 This makes me worried. As an investor, I’d be nervous about putting anything into Bitcoin purely because everyone’s talking about it. The best time to get into something, if you’re talking about Bitcoin as an investment, by the way, if you want to use an exchange, fine, go ahead, but if you’re talking about it as an investment, I would stay away from it, because, uh, you, you only ever want to be interested in something when nobody else is interested, and right now for me is too risky.

57:23 Risk is something I just want to stay away from. Sports, well, is it prudent money manager, that that would be his, the rules that he would use to trade his portfolio? So you know, that’s his thought. My thought is taking, you know, taking the other side of that trade. Okay, now, if people want to educate themselves more about Bitcoin, what do you tell them to go?

57:42 I mean, but I mean, I tried doing research. I think it’s on bitcoin.org.org. Yeah, it’s just a pantry way. Well, the one I opened in my account today was Coinbase. I have Coinbase.

57:50 Yeah, just read every article out there and get someone’s new impression every single time. I will say this, though. I, I opened one, but I did not buy one, and I’m gonna say this, I wouldn’t even buy one with your money, brands or your money next. I, I own two. I’m not, I’m not wealthy like Max.

58:06 So all right, before we wrap this up, um, first of all, Max, thanks for coming on. I appreciate it. We saw a new side of you today, that they might really, a new sign-up, really, three sides. I think I thought you were you were extreme on Russia Today, but this is great. This is great stuff.

58:20 I think, yeah, you need a podcast, maybe. Yeah, we do a weekly. Yeah, good idea. We’ll do it right here. I’ll let you produce it.

58:26 Done. Okay, you know, one thing, I did actually, an executive person. Yeah, sounds good. One thing I was going to ask you is, how’s that uh, drink working out for you? The energy drink.

58:39 Oh, f***ing drink. I wasn’t gonna say it. Caught me at one of my shows. Well, in my show, this is more like what I do in my live show. I do, I do my mic, what I call stand-up rage.

58:48 He used to be a stand-up comic, right? He started really in his late 70s, doing comedy in New York, in New York. Yeah, tough scene, huh? Yeah, but it was fascinating, because you had Jerry Seinfeld, who was, uh, the emcee at the, uh, um, Comic Strip in New York, so he was there, and, uh, and then he had Robin Williams. It was at, um, Catch a Rising Star across the street, and who else?

59:08 Rodney Dangerfield. I remember one I went on, at Catch a Rising Star, once, in between, right after Rodney Dangerfield and before Robin Williams, and I’m pretty sure that at the end of the night, if you ask somebody how is Max Keiser, nobody would have had any memory of that whatsoever. So there was something that happened between those two acts, but, you know, uh, and it got you here, basically. Well, I mean, yeah, I mean, it was exciting. So I’m just saying that there was, what was yours?

59:35 It was, it was a lot of people at that time that we see now, uh, like, uh, Curb Your Enthusiasm, what’s his name? Larry David. Larry David. He was hanging out with Jerry Seinfeld at the time. He had, uh, Jay Leno’s, uh, top writer, Jim Brogan, who really had a show before Jerry Seinfeld.

59:52 They were trying to launch him as the comedian who has a TV show, and then Jim Brogan, then his kind of flopped, then Seinfeld, like, is the next guy. We’ll try this guy, and then his, you know, click, and, you know, it was fantastic. So you’re doing stand-up comedy during these guys, and they’re blooming when they’re just blue. Yeah, that’s right. They were all there.

1:00:12 Steve Martin was in Los Angeles, you know. That was the West Coast scene. But, um, so yeah, I always like, uh, actually it’s kind of, it’s different than what I do now, because I always like, um, kind of the more, more of a, um, um, who’s that guy with the, the psychiatrist on TV? He had a record called The Button-Down Mind. Oh, I can’t think of his name.

1:00:40 You’ll know what it is, but it’s very kind of understated, understated, low, low voltage, understated stuff. Um, at that time, then, um, I was working to support my comedy habit, doing odd jobs, and I had a lot of odd jobs. I worked as a proofreader at a rubber stamp factory for a while. Really? Yeah, that sounds like a joke.

1:01:04 It’s a part of your bit as well. Yeah, I mean, it’s a weird job, you know, to read backwards. There’s a real factory in, on 23rd Street, which is now the Silicon Alley, but it was a rubber stamp factory, and you get these orders that come in, and the proofreader has to match the order with the galley from the guy upstairs, and patch this all, stuff. But one of the jobs I had, just, it was to work with a stockbroker at Paine Webber. This was 1982.

1:01:28 Just to do work with him, and I just walked in there, and it just, like, it hit me with a ton of bricks. Just like, this is fantastic, this is great, you know, the ticker tape going across the, the wall is just like totally mesmerizing. Was it easy money? Totally easy money, from ’83 to ’87, before the crash of ’87, which was, was unbelievably easy, because when I started at that time, most people in the business were older. They had gone through 16 years of a bear market on Wall Street.

1:01:59 Well, Wall Street was a dump. You know, guys are working night jobs to make ends meet. They’re working as taxi drivers, school teachers. You couldn’t make a living as a stockbroker in 1982. Wow, because Dow Jones had not gotten over a thousand, and that’s for 16 years to try to get over a thousand.

1:02:13 Okay, this got Allen, a coin, similarities, maybe. Well, anyway, you know, the, now it’s at 15,000. This is huge growth. So then all these young guys like myself came in, and we just, like, took over, and you, you literally could just call people up in the middle of Iowa, you know, on their tractor at five o’clock in the morning, and they would send you a hundred thousand bucks, you know, John on a story, and it was extremely easy, you know, for four, four years.

1:02:43 It was just this, the mountain of cash, just pick up the phone, pay whatever. It’s just so stop, you know, I was like, I did, you know, we, we would make but there’s also people calling us, so we’d be called. We’d be getting calls from, um, you know, Porsche dealers, prostitutes, drug dealers who are cold calling us. Well, we’re cold calling America, so you could like make 20,000 bucks in the, you know, on your stock business, but have spent thirty thousand that day on a party of some sort.

1:03:13 So it’s like the money is just like coming in. You know, it’s like a velocity of money, right? There, on Wall Street, like, you know, it’s like a hurricane, a funnel of money. It’s just so much of it spinning around. Then you had the crash of ’87.

1:03:24 Then it got very different. It got very corporate, and then you moved. Yeah, it got kind of boring. It got very, very corporate, very, you know, because in the early ’80s it was this very punk rock, because the punk rock scene in New York kind of merged with Wall Street for about four years. Wow.

1:03:39 So like myself, I was doing WNYU radio, you know, and I was feral, I would say, just doing CBGB’s, Max’s Kansas City, 24 hours in New York, just completely out there. So then, like, Wall Street, just like, the action was so intense. I just thought this would be fantastic, because this is like a party for the daytime to match my party at the night time. I need a day party, and this is it. So it’s like, and there’s just so much drugs at that point.

1:04:07 I mean, the New York Times estimated that 98% of everyone on Wall Street was using cocaine at that time, early ’80s. Everyone had, everyone. It was just Co piled up on desks, come on, everywhere. Absolutely everywhere, piled up on desk, piled up on desk. All right, so you’d be all day doing lines and selling stocks and paying Paine Webber, and then you go to CBGB’s at night in East Village, and after hours clubs, Save the Robots.

1:04:31 I’ve been there. Yeah, you know, East Village closed now. I think it’s a coffee bar now, you know. And then ’80s, the crash of ’87. Then it was like it just changed a lot, a lot, a lot of people.

1:04:43 It just changed. It became a lot more corporate, like the corporate raiders of the ’80s, like the Carl Icahns and Ivan Boesky, Michael Milken. Those people were all gone, and the new people became very corporate, so the leveraged buyout, which was considered to be corporate raiding, greenmail, hostile raids, became, you know, corporate. So you had corporations buying each other out, and it wasn’t the same kind of action that you had. I mean, I remember a deal, what was a General Electric barring RCA for 66 bucks a share, the stock was at 60.

1:05:11 It was a 98% guarantee that deal closing, and I paid two dividends before the deal closed. So you’re making 10, plus two dividends, and you’re just leveraging that up to the hilt, so you’re making like 150 percent on your cash on a guaranteed risk arbitrage deal, and you’re just calling people up and just throwing money in their pockets. Just a river of cash. But that’s okay with you at that time, that was the, uh, that was the same time, and then the banks took over a lot of that proprietary, banks got into it.

1:05:41 Yeah, banks got into it. They took, they kind of got control. It became very corporate, uh, and it is very Wall Street changed a lot, so it just, we got a little bit too corporate, so I, I went to Paris. I just got on a plane and just went to Paris, and said, I’m just going to go to Paris and see what happens, and I ended up, uh, there for about five years, and I, I wrote a treatment for a screenplay that I showed my friend Alec Baldwin, who I knew from NYU, and he showed it to Harvey Weinstein.

1:06:08 He bought it for a pretty nice sum of cash. Then I flew to Los Angeles. What was that screenplay? It was about these, uh, two psychic brothers during the 19, post-World War One, where they’re pursued by cops. Alec Baldwin, the actor, Alec Baldwin, and his brother Billy were going to be in the film, and then Harvey Weinstein bought this idea.

1:06:26 Then I went to Los Angeles to make this idea. So I left Paris. Then, um, they, um, they put it into turnaround, which is Wall Street, you know, Hollywood talk for, you know, we’re gonna put it in the freezer. If anyone wants to do it, pay us the money we put into it, which I think they put in a couple hundred thousand bucks at that point. This is Mirror Max time, so yeah, so then, um, I had nothing to do, essentially, so I looked at my, uh, the only person I knew in Los Angeles, so I knew from Wall Street, and we started this thing, and I said, I’m so bored in this, in Hollywood.

1:07:00 This is the boringest town I’ve ever been in. There’s, first of all, there’s no nothing to trade here. I said, we need a Hollywood Stock Exchange, and he’s like, that’s a great idea, so we, we launched that, and then that was a, you know, big, a big story there. Wow. Um, Russia Today.

1:07:15 What’s it like working for RT? How long you been there? I’ve been there, I think, three years now. Okay, yeah, it’s great. Okay, uh, what do you think about what people say about it?

1:07:25 That, um, so RT is fully, is, is fully funded by an NGO, which is fully funded by the Kremlin, right? And, and Putin just said we’re giving 300 million dollars to this organization for the, the rest of time. So is it just a Russian propaganda machine for the Kremlin? Well, there’s, first of all, all of these big networks are state funded. BBC is state funded.

1:07:47 Yes. Al Jazeera, state funded. Guitar T comes from, it’s a state funded Press TV. Well, I work for a state funded, I was, I had a show there for a while. Uh, American broadcast, Fox News is, if you think about it, stays funded because they have the military.

1:08:03 Comes on Fox News. They don’t say we’re selling weapons, but we’re supporting a war. That’s called propaganda, and that’s a state function. So that’s the funding, not funding, but okay. All right, yeah, I mean, but it’s, it’s, it’s propaganda.

1:08:17 Okay, you know, Fox News, CNN, CBS, CNBC. But on the propaganda question, though, I always, I always think that it’s actually flowing in the opposite direction, because since I started on RT, Russia’s increased their gold buys substantially. So when I’m running on my show, you know, I’ve got my own message to the Kremlin, which is keep buying gold, keep going, and they have been buying gold. They’re the biggest gold buyers in the world. Why is that?

1:08:44 Keep buying gold, keep buying gold. So if I say one thing, what are you saying here? It’s my propaganda? Oh, you’re running it back on them. Yeah, it’s a game.

1:08:54 It’s a game within a game within a game. You know, I’m all, I’m all about gold and silver. Now they’re buying golds, they’re buying gold. You see what I’m saying? Yeah, that’s what I’m saying.

1:09:07 In the mind. It’s in the mind. One thing we can agree on with Max on buying gold, that’s, uh, yeah, you guys are with that. And what if the U.S. funded a press situation that would then go into Russia and do investigative journalism in Russia? Everyone would throw their hands up, right?

1:09:22 Yet the opposite is kind of happening with our team. Uh, well, the U.S. dominates the global news agenda quite handily, and they back it up with the Pentagon and a global spy network. So, uh, the, there’s nobody, uh, who believes that the U.S. is without media outlets around the world doing their bidding and pushing their agenda. Uh, the wealth being aggregated in America, in the record hundreds of billions and trillions of dollars, is not by accident. You look at the corruption in the media space, the banking space, the broker in space, the accountants.

1:10:05 They’re really dirty. Like KPMG and the rest are the dirtiest of the lot. This all is backed up by the world reserve currency, the US dollar, and if you talk to people like Paul Craig Roberts, who was in the Reagan administration, or or Catherine Austin Fitz, who was, who worked with, who were in government as well with Reagan, you know, they always say, well, what backs the dollar? The, what backs the dollar is the Pentagon. You know what backs the Pentagon?

1:10:29 The media. So there’s no shortage of America’s interest being carried around the world. What, what’s now, what’s, what’s ingenious, I think, was that the state of Qatar came out with Al Jazeera English, so they set the ball rolling on a global phenomenon, where every country in the world now has an English-speaking 24-hour news channel. So, he had Al Jazeera when we started making films for out to zero. You know, George Bush wanted to bomb their headquarters in, in Qatar.

1:11:01 They killed one of their reporters in in Baghdad, and we got tremendous flack for doing, uh, films for Al Jazeera English during the Iraq War period. Uh, but the, the stories I was doing, like, Iceland’s economy is about to collapse. We went to Iceland and exposed this, uh, you know, or that these other corruption forces are at work. They got out there into the public domain through this English-speaking channel, and it should have been on the U.S. TV, but they weren’t, because there’s a bias against.

1:11:34 How does their English but anyway, so Al Jazeera English started the ball rolling. Then you have now Russia Today. You’ve got France 24, which is in English. You’ve got CCTV, which is Chinese. You’ve got Press TV, Iranian, uh, so doing well.

1:11:45 Russia Today has big numbers. I think on YouTube there are a number of views. It just exceeded the BBC, so they’re number one on YouTube for a number of views. Uh, they have the now bigger reach, I believe, than BBC, so it’s over 600 million around the world, uh, cable, uh, satellite, uh, wherever I go anywhere in the world, people know me. They watch the show.

1:12:06 They run, or they run to you or from you. Well, they, they know if I’m in town, things must be bad, so they get worried. They’re like, oh, I just saw Max, it’s like the Grim Reaper, or there’s Bitcoins around. Not that guy. Oh, we must be in trouble.

1:12:21 That’s why I’m in London, to cover the collapse of the UK economy, because I’m a war reporter. I gotta be on the front line. This is the new Iceland. This is the new Greece. Right here in London.

1:12:30 This is the new war zone. When’s it happening? It’s happening now. Look, the country is in dire straits. This, the, the all, the, this, by the funds came for real estate, the other huge Ponzi scheme, from the, the Cracker Head mind of George Osborne.

1:12:45 The destined to fail looks horrible. Okay, people are restless. Do you have any money in pounds? No, no. Okay, I have a few pounds in my pocket and sick coins everywhere else.

1:12:57 Um, Max, thank you so much for coming. I really appreciate it. I don’t think my microphones have ever had that volume, and I think they seem to work. Yeah, I think they’re going to be all right. Um, people to get in touch with you are on Twitter.

1:13:10 You’re at Max Keiser. You’re on television, at our team. You just put up a Mac signal in the sky. Maybe it’ll be there. It’s kind of like Batman.

1:13:16 I beat him in. I beam in on a beam of Bitcoin. Remember, there’s trouble with the fiat currency. I’m there. Just put the big B up in the sky, and Max appears.

1:13:25 I’m gonna have bad dreams. Um, Alessio, thank you for being here. I appreciate the charts. I appreciate the knowledge. How do people get a hold of you?

1:13:33 What’s going on in your world? Yeah, thanks very much for having me again, uh, Brian. Um, people can go into leadingtrader.com, which is my, my main base. In fact, we’re doing, um, we’re doing a free online seminar, free webinar, on the first of June, and you folks can join in. Essentially we’re doing, um, a special class, special one-hour class, uh, online as well, where folks can learn the secrets behind buying low and selling high, so instead of making the big mistakes that other people are making out there, getting into the wrong time and getting out at the wrong time, I’m going to show you guys for free.

1:14:05 By the way, it’s a free webinar. How to buy low, how to sell high. I’ll give you all the information about that on the 6th of June. I believe Thursday, 6th of June. Uh, just go to, go to leadingtrader.com forward slash real.

1:14:19 Okay, leadingtrader.com. Okay, people are going to register for free for the webinar. Okay, I’ll be there. I’ll check it out. Yeah, it’s good stuff.

1:14:28 Yeah, risk management, you’re a fan. I follow trades on Twitter, and it’s good stuff. I mean, it’s basically risk management. That’s right. That’s the key.

1:14:36 That’s it, and the key to making money is not to lose money. That’s right. There are two things with wealth. I always say one is to make it, second is to keep it, and most people don’t bother to learn the second one. So, wow, well said.

1:14:46 So much knowledge here. All right, well, thank you so much for watching. If you’re listening to us on iTunes, please subscribe. If you want to see the extremely good-looking Max Advisor, come to us on, I feel like I’m on Hollywood Squares. Yeah, remember that show, and in the center square, and you are in the center square.

1:15:00 Um, it’s London Real TV is our channel on YouTube. We’re on Twitter what about Satoshi? Don’t he get a plug? Satoshi, the mythical Japanese dude. She’s my Bitcoin.

1:15:14 It sounds like this guy from Iron Man. That’s like a Mandarin. Is he like the, the arch villain? He’s deeper name. The currency.

1:15:22 I have a small bit of a currency after himself. You know, that’s, yeah, yeah. Anyways, uh, thank you to him, and good luck with your Bitcoins, and I hope it works, and there’s an exchange and everything. Anyway, man, thanks, guys. Cool, thank you very much about the journey.

1:15:41 Thank you guys foreign