fam ask azure this is kaiser report some worst dilution that's right we talk about problems all year and then that summer time we come up with all solutions that say we're being joined by banker turned big coin entrepreneur simon dixon of banks the future long term friend of this show and as wave a bit of an introduction is book banks of the future came out roughly 10 years ago it actually predicted a major crisis in 2020 is almost clairvoyant and how that accurate that prediction was simon has also recently gone on record that he believes the central banks will go directly to people and bypass the banks with their money printing that's now being discussed in the highest circles of banking this is an amazing prediction that was made basically by simon he's the 1st he's the best investment banker in bed killing encrypt oh so really a seminal character in the whole industry simon i want to get started 1st of all

welcome thanks for having me no one gives an introduction like kaiser report thanks max well it well deserved now the front page of the economist magazine says free money in one month the united states printed more money than it had in 200 years how much longer can this money printer go burb before the whole thing collapses well that's the debate this going to be had right now so you all of a sudden as i say we talked about missing 2010 she of money is ruined so you might as well have the government's critics as much of it as a lawyer and going to a competing money supply came along right because i mean so now you've got these 3 different forms of competing money coming along you've caught more modern money tree theory whereby the government's just crazy creates all the money you've got the middle system which is what we've had for the last decades which is fractional reserve banking where the banks kr. privately yes like

a hybrid caused by cops and this free market stroke crony capitalist regulated environment which drives everyone into debt and then you go private money the next question is do we have deflation or do we have inflation and that's really dependent upon who craves the money of the faustus re so money has been destroyed as will these businesses before and that that consumers default on their debts and so the governments have to try and create new money at a fausta rates and if they do successfully creates another fausta rate the number of the full then you could end up with asset price deflation and consumer price inflation which seems to be the trend that we're heading towards with all this modern monetary theory that consequence of all that money printing and as you mentioned they're having to print faster and faster is the creation of the can tell you an error classed those who are benefiting from the 0 percent the free money

from the fed those who are closest to the fed versus those furthest away from the fed and many of them are of course out protesting and rioting in the streets across the world at the moment do you see that as a causal and relationship there is it correlated and how do you think this can telling our class might react to the collapse of this fat system yes so when money creation is created by a private bank as debt and government crave less and less money which is the money that they create is cash in coins you get $1.00 of the consequences of the one of the biggest rich poor divides which is what we've experienced which is you're pushing consumers into that in order to save the economy so they say one ever increasing levels of debt in order to try and get united to beat. inflation old trying to speculate on real estate which is driving them greater and greater and. sadat's as their mortgage repayment doesn't cover their income. each

and every month you know months a month ago and grace are in that and yet those the you know the closest so the cheap money you know the consumers of boring on credit cards and payday loans and paying extortionate interest rates as you who is covered but knows that of the richest and wealthiest in control the most awesome. can actually get access to this very cheap credit and they can use it for asset price in inflation so companies will use it to store prices and the the the you know you end up with this rich poor divide where the money's being used to prop up the riches assets and the consumers and the other class are deeper and deeper into that and so you just end up with this great says regis to be shown of wealth so we've had to see ever since occupy wall street there's been a lot of activism protests on the straight kind of focused on banks and banks

became a subject of a lot of protests do you think the lever see a time when all those protests around the world we call the global insurrection against banker occupation but do you think they're rallying cry from the street from some point will be to stop printing right i mean this is the opposite of what we have today because people particularly on the left side of the political equation are demanding more printing more subsidies sharing quote sharing the wealth but that's the problem is they're printing too much do you think they'll ever the penny will ever drop that they'll ever figure out that the problem is please stop printing no i don't think so because the people that are protesting in the streets right now are talking about the inequality and problem actually focusing you know the the inequality is the simpson but the problem is systemic and release the those people rioting in the streets to come to the realisation. the

actually too much government printing when everyone's austin for more businesses are asking for more consumers or austin more we need to somehow pay our mortgage we need now you pay our rent you shut down all businesses we caught on to anything so it's quite right that they should be all skin for more when the government's telling them that they call a. living but that they don't necessarily realize is that back can be the cause of the problem and the destruction of the system now if necessary deep in debt so i guess that they really can benefit from that debts that they have to repay in cheaper in the future or even the debt do you believe so i think that now be crying for more and more money printing the destruction of the system really reaches the point where the debt is so great that the rich need to be concerned. and that's really what i think that we're going to see nat's and i think we're actually going to see protesting in the streets again central banks are about to let them go boss

the government to give them the bailouts they won't necessarily be able to bail in and send the bankers i think are going to be protesting in the streets when the central bank actually brings all this money and salter in retail banking direct to consumer has 3 financial knees is what i think so i see in that sense you know that's kind of a genius point really and it gets in keeping with what we're saying here at member going back to occupy wall street the bankers upstairs in the on the office towers on wall street were throwing money out the went out you know thinking there again from what's happening with all this to tear money printing that you've described and then as you point out now read a point where the central banks if they go direct to the to the people using financial technology caught crypto currency is exactly a token from the central bank they're going to put these banks out of business now h.s.b.c. stock to set a new all time low you know and what is big banks like that than 2008 could go belly up. you know we saw lehmann go belly up bear stearns went on their northern

rock in the u.k. went under it started the whole stampede of 2008 we could see a just b.c. or deutsche bank go under our huge avalanche and what you're saying is no bail and this time no bailouts we're just going to cut you off completely and we're going to have backers in a 3 piece suits doing on the street joining the global insurrection against central bank occupation i think that could very well happen let's talk about the u.s. dollar for a 2nd you know it is the it is the does world reserve currency and there's a lot going on here a lot of question marks surrounding this your thoughts you know well i think what we see what we're going to see next isn't 944 style bretton woods agreement monetary renegotiation and so i think that obviously the u.s. will get a seat at the table as they did in the previous monetary negotiations and they're going to obviously try and you know keep the strength of the dollar until the

dollar is not worth anything then it is still the strongest currency out in terms of money i'd rather have dollars and then it's not also the moment so you know the facts that 70 percent of all. over you know debts and transactions are all u.s. dollars and 50 percent of transactions actually happen in u.s. dollars means that everyone says you've got an incentive to keep it alive they're exploiting a lot of their inflation through the people's bank of china to china who obviously have monetary controls. lending a lot of money to the u.s. and they have to swap in all those u.s. dollars that they receive the chinese yuan leading that they have to print a lot of money and they're trying to figure out where they're putting it but really i think the seat at the table of all these large super currencies and countries is going to be how much gold they have and so that's essentially. why you know the

countries with the largest gold to g.d.p. ratios are the ones that going to have a seat at the table as germany for europe that's russia that's china who we don't fully know how much a goal but we know they've been accumulates more than a saying and us as well this race to the bottom as you point out a world of fractional banking world apprentice money to try to export your way g.d.p. growth has created this perverse incentive system where countries are trying to out print each other and goal is not having a goal is not fooled goaltending new all time highs in every major current currency including now the u.s. dollar you know against this backdrop we saw the insanity of negative interest rates and that up until recently was considered a financial and possibility that's never appear in any financial textbook in history and we also saw negative energy prices as well but putting that aside for a 2nd and negative interest rates you've been in the business now many many years and how does that fit into your model when negative interest rates are just

a way of discouraging savings for the p.f. you know for their use the don't have access to the q.e. money you know those that have access to the q.e. money can can be on the right side of negative interest rates and those that don't have access essentially simply saying save any of your money we want you to spend it we want you to be broken we want you to boree we need more money in the system we need you to borrow more money and so please don't have a pension please don't have a retirement and please don't save we're going to penalize all of that and the smart strategy for anyone in this economy is take on as much stats and hope for a debt you believe because that's where everything's headed so you know negative interest rates are just. a signal to the wode cleese and say we don't want you to good point all right well we're going to continue this discussion after the break simon dixon back to the future the bank the platform and the book heading. second

decade and a must read don't go away more with simon after the break. hooper joe you know they have so being you.

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no dairy thinks. we dare to ask. welcome back to reports summer solutions are back to stacey right on cue the storm clouds of the dead a bit of a for a boating as we talk to simon dixon about the and media future bank central banks and the currents a bit coy and what people can expect now simon getting back to our discussion one

of the head a couple points there that. get your thoughts on paul tudor jones very famous hedge fund manager i've been following him for decades who put 100000000 dollars into bit coin futures contracts he says bitcoin is the fastest horse in the race this is obviously now institutional money pouring into because maybe just for the audience explain because i hear a lot of people saying well those are big point futures contracts they don't count but simon what are your thoughts i think we are headed in the same direction as gold where there are going to be paper versions of because. you have to remember and we're going to see jury in this great depression a 2020 there is a difference between gold and paper gold we're already starting to see the absolute scarcity the reason we're reaching a new time highs is because people want their physical gold people want their gold close to them and the smart people are getting their gold close to them and so all these paper contracts where there's not enough gold to actually act all of these

aper contracts creates a scarcity in the underlying assets i think we're going through a similar situation in. the big trends right now is the fire and you know the sort of on chain yielding products and financial products but really centralized financial companies or the building on top of the solutions they're building paper contracts they're building you know these different types of contracts but they eventually lead to a scarcity of the underlying assets because if you don't own the private key then it is not your big. coyness the old mantra not your keys not your coins and remember we have all of these derivatives and financial institutions and now we've got banks custody in coin you know they can end up owning them just like fear money they can and are spending them just lifea of money and they can end up creating paper and represent asians all of them but they are not the underlying and fortunately there's

a big chain where you can actually see unlike gold how much because there is how many more there are to be created and the exact monetary policy which creates the scarcity hardass form of money but the world has ever seen that can be deduced these bands really don't confuse that futures contract when it comes to investors and they tend to use these paper versions because they don't want to actually store the underlying because they're just trying to get exposure and i think that's just going to drive a lot more people into the paper version which eventually leads to a scramble for the underlying assets once those once you actually need it which is where we're headed at the moment of course the united states j.p. morgan bank is being prosecuted under rico for their manipulation using future is and paper gold to manipulate the gold and silver market so that would be interesting in light of what you said in the 1st half in terms of these bankers i just really want to see jamie diamond like storming grand central right next to

j.p. morgan's headquarters and just like start. start some sort of riot for for the bankers and you know in case for the audience just so you know we are in north carolina which is hurricane alley so you could hear a real live hurricane coming through right now as we speak i know simon this is probably your 1st hurricane you may have experienced ever. it is well let's talk further about these these futures contracts and the whole derivatives space because other than this notion of an e.m.p. or the whole internet going down one thing we always hear from naysayers is that bankers are going to take over this and they're going to manipulate it like gold and silver and that this is that thus a reason why one should not own bitcoin do you agree with that how do you respond to that argument and the way i would respond to that market now argument rather is

the same for every single market so i used to be a market maker on the london stock exchange and my full time job was to manipulate the price of stocks and shares up and down so if somebody was putting out a tearful on the news or in a magazine back then it was investors chronicle words and stuff like that then we used to push prices up push him down try and create some activity and create some liquidity but eventually the long term fundamentals for mel and we're starting to see that with gold at the moment as well the reason that gold is more. is because through all of the manipulation steroid ever all the accusations all you construct the manipulation unfortunately the short term the long term you know the on the mental supply we've already seen big manipulated shorts on many occasions you know c.e.c. these joint normal orders going into the exchanges that make people dump the price short. and people start speculating on who sent and selling them some of the

you know earlier this year about 50 really early. yes isn't big calling was sent to an exchange these are all designed so manipulation so you can get in every single market but really as an investor focus on the long term fundamentals unless you want to trade split pay in some of these insider manipulation games let's go back to the sovereign layer here you know the crisis genius protocol of stack of game theory and it seems to go higher and higher up the ladder and now at the sovereign level where the question is what state or a group of states will start getting into buying or acquiring or mining because it is a way to add to their strategic reserves and different sovereigns are now trading their own sovereign digital currencies people trying to figure out how that fits into the big quaint space that japan is going to introduce the digital yen china's thinking about a coin except. and so a couple of questions so when japan appears to introduce

a digital yen. you know what do you think about a national crypto currency in the 2nd part of the question is the pushback you hear from people is that well what have countries outlaw because and that there is another want to get into competitive bidding to add to their strategic reserves and acquire bitcoin that's the flip side of that argument but how do you come down simon on this sovereign digital crypto coin now in the pickle in space and how's that going to play out the things current see is going to be 100 percent digital very soon or is he is in some countries. the interesting thing that people confused is people often think. that you know the central bank digital currency is the same thing as what we've already goltz because the money is already digital and there's a war on cash and cash is virtually disappeared anyway there is i see a major major difference it's who creates the central bank digital currencies and how they're crazy so when a country actually creates

a central bank digital currency. into vehicle. me and they're going to have to figure out their models i personally think the way they're going to issue it is as a result of allowing people to access a helical to money as a as a individual universal credit income. and they're also going to issue it in proportion to banks go embossed so people don't lose. so if you have some money in a bank you can just get some central bank digital currency in the bank and go bust hence the banks writing in the story. so i think the but it's not backed by debt as well as another interesting point so it actually is a deal leveraging affair when central banks issue these digital currencies versus the digital currency those created by the private bank with regards to bitcoin gives people an all in a nexus because when central banks and governments create the digits digital

currency is going to be all full effects on your privacy your freedom your ability to spend your money as you choose is going to be intersected with compulsory vaccines is going to be intersected with your ability to get on a plane in the future and the anti money laundering regimes and automated tax collections are going to be all intertwined and we're just going to have more and more into connection with the central bank digital currency so that's where bitcoin really comes in and then people lost well will they ban it we already have seen use cases we've seen the china and exchanges and it pushed the price from $3000.00 arts of the $20000.00 through overseas part of that was a speculative bubble correctives and now we're starting to stabilize a bit more so i think we'd be very naive to think that governments wouldn't try and ban bitcoin when they start to realise and it becomes a political power play and we already saw that you know with the with the gold in the pasta when it came to the monitor renegotiation when to many people were

hoarding and they wanted to increase the velocity of money. the band golden just simply made it illegal in america but at the same time there was a 2 tiered markets a market for converting at the central bank and a market other countries so what i think you'll start to see is car countries where their currencies are being destroyed right now that are experiencing hyperinflation or debts you know overindebtedness like we're seeing in countries like lebanon i think they're going to have an opportunity to achieve coin and then announce it as one of the reserves on mass and for banks so fortunately the competitive forces i think will make it where if one country makes it illegal another country will see that as an opportunity and we'll start to see this country central bank level where the last central bank then announces they're going to hold some of their reserves in big going as well as golden dollars and currency actually become the

biggest losers and so i think we're going to start to see because as a political tool by central banks because it can be used by anybody let's talk about any be it buddy because we talk about summer solutions here and we're talking about a renaissance like a moment of rebirth so if you're saying that all these banks the j.p. morgan's goldman sachs h.s.b.c. deutsche bank b.m.p. pare about that they all go away they disappear they collapse. is of course your own bank so what happens in a post banking post the out world like how much entrepreneurship a flourishing of like fraud free or certainly reduced fraud and vironment like what happens i don't think we're going to see a post fear i think fear will survive and it would just be in a different format since the fear that you're going to see is going to have less freedom less over and see less privacy and lots of really horrible features built into it. and if banks go boss this is not the the banks go away as the banks

have a choice of a. ivor adjusting to the central bank digital currency they don't get a super subsidy they they're no longer too big to fail because the central bank can just let them fail and there's a way of you know auction awful the debts and replacing money with a central bank digital currency so it actually drives banks to be more honest and if they don't perform that when they're not too big when then when they're not too big to fail they have to compete with financial technology companies of all be building in this fear. now all of those these different players that come along and they're all competing there is you know this exit opportunity which is that you can pay on the form of money which is to just use gas and can't be manipulated so i think that you're still going to see fraud i think you're going to see fraud where companies building on top of bitcoin like we have in the last all of these things

don't necessarily go away but they look like a new form and the most important thing is the competitive forces users having the choice of where to where to play where to be use your fear money not because you have to but because it's convenient for certain use cases but don't put your savings in there and i think that's what we're going to see we're going to see every single financial products rebuilt in a decentralized way and in a more centralized way with 2 forces competing and consumers having more choice finance is going to get more complicated mission and again they're going to continue but the beauty of this is that you've got more choice and you do have a hard sell more money and you don't need to rely on your government wow simon dixon great stuff that a should add to your bio they. fear tourist you know if you really do qualify as a futurist you have predicted so many things have come true thanks for being on kaiser report summer solutions pleasure thanks for having me but that's going to do it for this edition of 3 part with max as they say i want to thank our guest again

simon dixon of bank of the future. just on twitter it's kaiser report it's a lifetime. so what we've got to do is identify the threats that we have it's crazy confrontation let it be an arms race in this on all fronts very dramatic development only personally i'm going to resist i don't see how that strategy will be successful very critical time time to sit down and talk. has changed american lives but pharmaceutical companies have

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