This is a transcribed version of the “Bitcoin Magazine Podcast,” hosted by P and Q. In this episode, they are joined by Jimmy Song to talk about bitcoin adoption in El Salvador.
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[00:00:06] Q: I'm excited to introduce our guest for today. None other than Jimmy song, Jimmy, thank you for joining us. How goes it?
[00:00:14] Jimmy Song: It goes, well, I just came back from El Salvador teaching some people there, Bitcoin programming. So it's good to be back home. And you know, here with you guys, of course, I have to come back.
[00:00:24] Q: I appreciate you cutting your trip to El Salvador short, just to grace us with your presence. How was it, man? We saw some pictures. You were down there with Max and Stacy [Keiser]. And talk to us a little bit first about just what what's, what does El Salvador feel like in a bear market?
[00:00:40] Jimmy Song: Well, it's interesting. This was something that I was telling Max and Stacy, I was there six months ago, things have changed. Like, you can see things being built and stuff like that. There are bike lanes there now, which weren't there before. They're like, yeah, they put this in last week. It looks really nice. Everything is, you know, brand new, going up and, you know, things are building. And you, you can just sort of see in the country that there's a lot more energy, a lot more building and it's what you would expect it to look like if it wasn't bogged down with, you know, different forms of oppression, I guess, whether it's the IMF or, the M13 gangs and stuff like that.
So you, you can kind of see it as far as Bitcoin goes you know, there, there, you can still pay for stuff and Bitcoin and it's, it's pretty cool. I think there were a lot of people that sort of expected it to become like a libertarian paradise overnight. It's not quite that fast, but I mean, it's, it's, it's becoming something pretty pretty quickly.
I like being there. I was there to train some programmers because as you know, we need more programmers and El Salvador needs more programmers. Yeah, it it's, it's interesting cuz like you don't get to see the day to day, but when you visit, you can clearly see progress and that's, that's what I saw.
[00:02:07] Q: You know, we hear a lot around this conversation that the people who most need Bitcoin today can't excuse me, can't afford these 80% drawdowns. You've been to El Salvador before. They're now reeling with, you know, that 80% drawdown. I believe don't quote me on this, but maybe it was around $40,000 when you were visiting. We're down in the low twenties right now. So even a 50% draw down. Were there any concerns from El Salvadorians or was it still like, you know, this focus on continuing to build this ecosystem and learn as much as we can while we can?
[00:02:45] Jimmy Song: I don't know if I'm the right person to ask because the people I tend to meet are very bullish on Bitcoin.
So, they're kind of gonna be self-selected but the people I taught were very enthusiastic about Bitcoin and so on. So I wouldn't, I would say that there's still a lot of enthusiasm for it and there's a lot of people wanting to build there's you know, the, the government is still bullish on it and everything else.
They're taking care of some other problems first. Namely the gangs, I think they've arrested something like 40,000 gang members. And they're no longer sort of extorting money from like the PPOA vendor or whatever. And that's a very good thing. It's adding more money to people's pockets and getting rid of these sort of extortionist/rent seekers.
[00:03:38] Q: I think it's a very interesting thing that, you know, a lot of Western news outlets will try to portray Bal as this authoritarian leader. When in fact it seems like it's just trying to combat corruption in his country, so remains to be seen how things pan out. Let's talk a little bit about just sort of…
[00:03:59] P: Wait, wait, I do just wanna jump in though. It's not necessarily that simple though, right? I mean, he also has said he is the world's coolest dictator, and I think, you know, there are a lot of authoritarian things that he is doing and that he would very publicly say that he's doing.
[00:04:13] Q: I mean, I mean,
[00:04:15] Jimmy Song: I think putting gang members in prison is not authoritarian per se. I mean, these are people that are going up to like the food vendor on the sidewalk and extorting them for half their profits for the day.
[00:04:32] P: And those people absolutely should be, you know, dried and figured out. I mean, I, I just will say that some of the videos that were coming out, like when that initially was happening again, huge fan of El Salvador, the World Economic Forum is absolutely trying to completely screw them over.
And you know, I think there's a lot of amazing stuff that [President Nayib] Bukele is doing. But some of those videos that when they first came out around the gangs, seemed chilling. You know, it was like everybody sort of like there, for being forced to crab walk and stuff, and it was weird.
[00:05:04] Jimmy Song: Yeah, they're gonna take like the worst videos and make it seem like that's the norm and stuff like that. And that this is the IMS playbook. You know, there, there's a whole thing about Pegasus and the journalists and stuff like that. You haven't heard that story anymore, right? The reason why you haven't is because they found out that some of Bukele's government officials also had Pegasus installed out of them.
So it wasn't the, it wasn't their government installing it. It's somebody else. We don't know who, but it's not, it's not Bukele who's doing it, but you know, everyone sort of automatically assumed that it was Bukele and oh, he's this dictator that's keeping tabs on journalists. Actually, we have no idea who's keeping tabs on the journalist because it's not just them. It's like a bunch of Bukele’s friends that have the stuff installed on them. So I like that there's a lot of propaganda going around about and the IMF is motivated to make them look as bad as possible, a hundred percent. But that's not what I saw.
And you know, like, be careful about the news that you hear outside of El Salvador, because most of the people that are pushing a particular narrative have an agenda. The Washington Post, New York times, those places have a total agenda. Absolutely, and it's to influence [Washington] DC and the lawmakers and keep this narrative of dictator alive so that they can essentially keep exploiting because think about it like El Salvador has been exploited significantly. Some of the stuff that I learned, for example, they are only allowed to import beef from their free trade zone, which is like the central American free trade zone.
I think it's El Salvador, Nicaragua, Guatemala, Honduras and one other country, which I can't remember, but those are the only ones that have a free trade zone. And then and, but other than that, if they wanna import beef, they have to do it from the U.S. So Argentinian beef is great. It's grass fed, it's delicious and it's plentiful and it's cheap, but they can't import it because they have this weird trade deal with the U.S.
And the U.S. can have these very unfair sort of rules around stuff like that and keep them continuing to be oppressed because of the relationship that it's able to enforce through the IMF loans. They're finally kind of getting out from under it.
And, you know, this is kind of what happens. It's like the beef that I ate there, cuz it was mostly from Nicaragua, but I would love to eat Argentinian beef. That's like not stuff, you know, like why, why isn't that available? And that's not the only one, there's all sorts of stuff.
Particularly around food exports and stuff, which the U.S. totally takes advantage of. There's a reason why there’s this narrative of Bukele being a dictator. I will tell you though, that there are 6 million people in El Salvador, there are 3 million outside of El Salvador.
Most of them are in the U.S. and Bukele has as high or higher approval rating among the diaspora than he does at home. So that tells you something that's, that's not the case for, you know, Raul Castro or, you know, [Cesar] Chavez or whoever. That's a very, very different thing.
[00:08:32] Q: You know, I think also, and I don't want to go too into detail because, I'm admitting that and maybe, maybe this will hold me accountable. I'm trying to do some research on a potential article, but there was a big narrative about 20 years ago that the president of Singapore was this authoritarian leader who ought not to be trusted and we shouldn't be doing business with them.
And you know, if you had invested in Singapore in their growth 20 years ago, you would've made a very, very good bet. And I candidly think the IMF is running a very similar playbook against BHA and El Salvador that fast forward in 10, 20, 30 years, people are gonna be like, oh shit, El Salvador was a no brainer.
Just like doing an investment in Singapore now. I mean, at this point now Singapore is almost overdone. So I, I do think that there's a big narrative. There's that chart that Bloomberg posted of the 19 next countries that could default on their debt after what we saw out of Sri Lanka. And top of the list is El Salvador. I can't help a chuckle.
[00:09:42] Jimmy Song: What are they defaulting on though? That's the key difference. So if they default on the IMF debt, they actually can kind of afford to do that. Because then they can go and raise money using the volcano bonds. And that, that, that may be the direction that they go in because IMF loans come with a lot of strings attached.
You have to spend money a certain way. You can only put a certain percentage towards infrastructure, for example. And and for whatever reason, a lot of the leaders in countries that take IMF loans end up embezzling it, I think it has something to do with the fact that it's money from foreigners and they don't feel that bad about taking it from their, from foreigners as opposed to their own people or something like that.
But yeah, I, I mean, I, I wouldn't worry too much about you know, stuff like that. It's what, what you can see on the ground is clearly that they are building and you can, you can see it. And it's beautiful. I was commenting to Max and Stacy, like there's a hotel that we stayed at that whole neighborhood.
If you walk around. You couldn't tell the difference between that and like, you know, a suburb of, of the United States or like, you know, LA or something like that. It's, it's, it's beautiful. Like it's well manicured every, like maybe the Chinese embassy has razor wire at the top, something like that.
But other than that, like everything is like growing. And that's the best evidence. I saw that whatever they're doing is working now, is it authoritarian? It really depends what you mean by that. Because in a sense that the things that people complain most about are with respect to civil liberties.
But I mean like gangs that are extorting people, that's, that's not really civil liberties. I mean, the things that usually the people in the U.S. are complaining about are related to. Okay, well, these M13 gang members you know, they're not given, you know, perfect due process or something like that rather than, okay.
Like these guys were harassing all of these you know, street vendors and taking, you know, half their wage every day. And now it's now they're able to keep their full wage, like those are good things. If you wanna call that a call getting rid of criminals, like authoritarianism, it just seems kind of ridiculous to me.
[00:12:19] Q: Well, to be honest, it's beautiful when you put it like that, but Jimmy let's think about this for a second. Mm-hmm while these criminals are doing that to the individual citizens, how is that any different than the way the IMF is doing that to the country itself, with the way they're forcing them to.
So, Hey, you have to pay us in this certain way and do these certain things. And if you don't like we hold you by the balls.
[00:12:42] Jimmy Song: Yeah. I mean, it kind of is, it's just that there's no real recourse after that. There's no higher authority to appeal to basically, and this is kind of, the problem is the U.S. is the dominant, it's the equivalent of the Supreme court or whatever it's you know, their decision it's final and that's it.
And that's, that's what, that's the situation we have. And, you know, it's, it's gonna take some time. But I, I think El Salvador's on its way to like, actually like growing and. Doing some good things. And it'll be interesting to see if the other central American countries follow cuz. I mean, certainly people in Guatemala are very interested.
People in Nicaragua, Honduras, Costa Rica, they're, they're all watching. And if this volcano bond thing goes through which you know who, who knows when it's gonna happen, but I suspect somewhere around the one year anniversary, which is around September you know, they're, they're gonna have cash without IMFs assistance, in which case then, okay, now, now they can actually go build stuff without needing to stay strictly in the lane of the international monetary order.
[00:13:57] Q: Was there anything that this trip surprised you or stood out in comparison to the last time you went.
[00:14:03] Jimmy Song: Well, I, I didn't stay very long, so , I, I literally flew there Sunday and came back yesterday. So it was like, and two of those days I was just straight up teaching the whole time. So I, I didn't really get to go out or anything.
But you know, the biggest things were mostly just kind of visual, just yeah, things just look safer. I don't know. Like, it looks more beautiful. Things are building though those are the, those are the things that stood out to me. And now, I mean, granted, I stayed in like, sort of like a posh area of San Salvador, but you can kind of see it everywhere.
It's everything, everyone is building. Everyone is doing more stuff because the bad guys are out. I don't know. And and you know, what, what the president there is doing is making a difference.
[00:14:52] Q: You know, now that you're back in America, how, how disappointed are you? How much do you just come back here? You're like, God damn it. I'm back to the same old shit. Nothing changed.
[00:15:02] Jimmy Song: well, I I'm, I'm optimistic because of Bitcoin. I mean, I, I wrote about this in the, in the article this week. It it's you know, there, if you have Bitcoin, you have this like, sort of hope, right?
Cause you're, you're not on the rat race, treadmill, whatever. And instead you you're, you have the space to think about life a little more deeply and try to Accomplish something that's meaningful rather than, Hey, let's just go after what everyone else is going after, which is essentially rent seeking positions.
And that, that's, that's a good thing. I, I don't know. I, I'm not really disappointed per se ever with Bitcoin cuz the people that attack Bitcoin, they it's, it's pretty obvious to me that they are, you know, affinity, scammers or whatever. I, I don't need or want their approval in any way, shape or form.
The people in the Fiat world, I, I don't want need or you know, want their approval either. It's I, I, I feel like I have a different sort of mindset than a lot of other people because there's this thing called Bitcoin. I, and I have savings. So. I don't have to think about, okay, how can I make rent this month?
Or how do I make sure I'm progressing in my career in the next year that is in line with my colleagues or something like that. I, I don't have to do any of that. I, I can just continue to focus on the long term things. For me, that's bringing sound money to the world and that's Bitcoin and I, I can think about, okay, well, how can I best achieve that?
How do I, how do I influence things to go in in that direction? Certainly like training developers in El Salvador is a small step in that direction, but it's something that I can do that that maybe not that many people can. So I, I like thinking about those things and building things for the long term.
And I think a lot of other Bitcoiners are as well. And that's, that's, you know, what gives me optimism is, is that. At least in this community. You know, I, a lot of my friends in the Bitcoin community, like they're, they're thinking, okay, how do I make sure that I leave a legacy so that like, you know, my Bitcoin turns into like, you know, a family that has generational wealth.
You know, we, you know, my name, my last name can be like the Rockefellers or something from, you know, a hundred years ago. I mean, not like their corrupt parts, but you know, just the, the fact that they're able to last and leave legacies and stuff like that. You know, those, those are things I, I, I think are more meaningful and I, I, I don't know.
It's, it's not depressing to me the least .
[00:17:52] Q: Fair fair. I always just love going and seeing other cultures in other parts of the world in the country. I dig guess though, I think you, while you were in El Salvador, we were actually having this conversation. Wow. Yeah, we had it here on BI Bitcoin magazine.
I was like, did we have it on Bitcoin magazine spaces? Where we were kind of, we talked about this idea of like, you know, the narrative that was fed to, to my generation, that, you know, your generation, the generation before U's generation was feeding saying like, you know, you can be anything you wanna be.
And the idea of like dreams and just how, you know, unfortunately everyone just wanted to be a fucking pro-athlete or a fucking famous movie star or a TikTok star. And then lo and behold, I think it was James lavish who was quoted the other day or no, it was Luke Groman say that there were more people more.
Individual human beings drafted into the major league in major league baseballs draft, then graduated with a chemical engineering degree last year. Like that's how far we've kind of fallen. And I think that actually feeds into a little bit of a little bit of what you talked about in your most recent piece, how replacing reality with Fiat falsehoods destroys meeting and just the idea of like, where is our purpose coming from and what, what is real from the, the figments of our imagination that we've created?
[00:19:16] Jimmy Song: Hmm. Yeah. And and it, it was, it was a fun piece for me to write because it it's sort of like. Conglomerated a lot of the other things that I had been writing about. And I realized like a lot of the values that we get taught are not from family anymore, as much as it is Fiat education. So you're taught what to believe and how to behave.
And what's good and what's bad from school, right? Like, you're, you're told, okay. You know, thi this is what, you know, being a good citizen means rather than here's who you are as a member of this family, that, that used to be a much stronger part of your identity. It's it really has sort of like equalized and, or diminished over the years where people don't identify with their family so much as maybe the school that they graduated from.
And that that's more their identity and it gives sort of like a flavor of what you might believe and so on. And it it's, it's very uniform. It's very conformist. It's very sort of status and emphasizing compliance to the state, something like that, rather than I think a family identity, which is way more based on loyalty and love and, you know, family identity, if you will which tend to be a lot.
Stronger as an identity because you know, you, first of all, you share a lot of genes and stuff like that. So it's a, there there's sort of like a, a biological component to your identity. That's not necessarily there when you're, you know, graduating from a class it's, it's not like ideological as, or it could be, but like, you know, there, there's sort of like a physical biological component to your identity within family that that's kind of missing in Fiat education in, in our sort of like haste to make everything equal.
We've kind of removed a lot of meaning. And it's been taken over by Fe the Fiat system to essentially make everyone like drones or something, you know, like, very compliant cogs in the Fiat system. You know, that Fiat companies and Fiat politics all, all of those sort of like. Are the versions of things that we're supposed to get meaning out of.
And really all, all three of those are very empty. They're mostly around compliance or rent seeking or you know, getting artificially outraged or something like that. And those are not really good sources of meaning because what's there today is gone tomorrow. They're, they're all very short term, very high time preference things.
Whereas, you know, you know, family, community, religion, like the, those have actually created things that have lasted a very long time. And it's, it's much easier to get meaning out of those because you're contributing something to something that's bigger than yourself that isn't going away. Right. Like that, that, that's a, that's a very important and.
Thing for most people and you know, writing about it and seeing how it's related to all of these other things. It, it, it led down to like this idea of the basement, the idea that, you know, Fiat money is the base money and Fiat, meaning is the base meaning Fiat or education is the base education Fiat, you know, companies are the base communities and, you know, Fiat philosophy is essentially the base religion.
It it's, it's very you know, it, it removes sort of like the meat or the, the, the really valuable parts and leaves you with sort of like the husk or something. And that, that, that's what I think most people find. So unsatisfying about modern life.
[00:23:17] Q: How much like, and I don't mean to harp on this, but I have a big belief that the way our education system is designed, it's designed to create these thoughtless robots that just complete tasks at hand, without really thinking through what needs to get done. How much do you attribute things like our public public education system to feeding and perpetuating the Fiat system to then grow into exactly this like thoughtless people who just sort of do what they're told to do, because that's what you've done your whole life.
[00:23:49] Jimmy Song: Yeah. And, and it's actually even worse than what you say. Cause it's not just about compliance to the state. It's, it's giving you sort of like trinkets to go after. So, you know, if you're in high school, what do you wanna do you want to get into a good college, maybe an Ivy league college, maybe Harvard, right?
Like, and then once you get into Harvard, what do you wanna do? Well, You wanna get to the next thing? What's the next thing? Well, it's an investment banking job at Goldman Sachs, right. At a college, or, you know, maybe you go to law school and try to get a position at a top tier law firm, or maybe you go to med school and get into a really prestigious residency program.
And, you know, I mean like these it's it's not just like meaningless cogs in a wheel it's cogs that appear meaningful, but once you achieve them, they, they really have very little meaning. And it it's just sort of like this filtering mechanism and it's it's based not on its intrinsic meaningfulness, but this, but because of an artificial scarcity that is created by Fiat money, right?
Like, we have very abundant money, so you have to have scarcity elsewhere and it's in, you know, The number of doctors in the country. For example, I, I don't know if you know this, but the number of doctors that come in every year, so there's always like retirements and debts and stuff like that. So a bunch of doctors go away from the market, the number of new doctors that come in, that's entirely controlled by the American medical association, they decide exactly how many new doctors are that are gonna be.
And they, they represent the, you know, group of doctors that already exist. So what are they gonna do? Well, they're gonna make sure that every doctor that comes in has, or that there isn't a saturation of extra doctors instead, there's just enough to cover everybody because they don't want any doctor to go out of business.
Of course, that's like a horrible incentive because in a sense, like if you have a bad doctor, Like it, it's kind of hard to get rid of them and there isn't as much competition. And, you know, we think about why healthcare's so messed up. That's part of it. It's if everybody got to be a doctor that wanted to be a doctor, this would be a very different market.
But that's not the case. It's, it's a monopoly controlled by a single entity. So you have this sort of like artificial scarcity created by the Fiat system at all levels. Whether it's college or, you know, Fiat companies or these extraordinary like achievement things. And the ironic thing is like the people that get them feel so proud that they have, right?
Like the, the PhD from Harvard or whatever it's considered super prestigious or whatever. But like most of those are actually like the most Rente of the rent seekest and like, they probably have tremendous amounts of ability, but. It's being channeled towards these Fiat games rather than to the market with entrepreneurship and stuff.
Like you, you have all this talent and you're, you're gonna spend it like doing postdoc after postdoc and academia, rather than like trying to invent something that might be useful to the market. Like the, this is, this is why the Fiat system is, has been so, you know, draining to to everything. It, it, it sucks the creativity and energy and life out of almost everything including the very people that it's supposed to help.
It, it, it, through Fiat education and Fiat companies and Fiat politics and everything else just like demotivates them tremendously puts them wrong incentives in front of them and makes them. Play games that really people don't wanna play. Right. Politics. And, you know, I mean, if you're, if you're an academic you're, you're writing grant proposals all the time.