The Everything Code: Debt, Demographics, And The Infinite Human Future | Raoul Pal

The podcast discusses a significant regime shift in the economy and politics, driven by accelerating technological advancements and demographic changes. The podcast emphasizes that the political class is unprepared for this rapid change, including the rise of artificial intelligence (AI) and its impact on labor markets and economic growth. Further, the speakers discuss the potential for a significant increase in wealth generation through crypto assets and the future of the internet, with a corresponding increase in speculation in the markets, alongside ongoing concerns about inflation.

Political Shift

• 00:00:54 The podcast discusses a major political shift, transitioning from the battle between labor and capital to a new struggle between humanists and transhumanists, specifically, the accelerationists who are embracing technological advancements. This group has recently taken control of the White House and is focused on pushing through significant changes. The political class is still largely unaware of the scale of these changes and their potential consequences.

Economic Singularity

• 00:00:00 The speakers believe that humanity has only a few business cycles remaining before the economy enters a new era where existing models and understanding are no longer applicable. This shift is being driven by the exponential development of AI, including the potential for artificial general intelligence (AGI) and the large-scale adoption of robots and AI in various industries. The speakers predict that the economic system will likely break within the next 10-15 years as these technologies transform the labor market and the ways we understand and measure economic growth.

Debt and Aging Population

• 00:07:15 The speakers argue that debt levels are unsustainably high globally due to aging populations and declining labor force participation rates. The speakers explain that the formula for GDP includes population growth, productivity growth, and debt growth. In order to continue to grow the GDP, debt is being used to offset the declining population. This ongoing cycle results in a general debasement of currency. The current approach is to increase growth to service debts, but achieving long-term growth in an aging population is challenging.

Inflation

• 00:31:29 The speakers argue that AI and robots are a potent deflationary force but are not yet at a scale where this impact is visible. They believe that while there may be a cyclical increase in inflation, the long-term trend is deflationary. The speakers highlight that China's aging population is decreasing demand for commodities, making it challenging to create a secular change in inflation. This view contrasts with the opinions of gold bugs who believe interest rates should rise and inflation will continue to increase.

Crypto and the Future of the Internet

• 00:41:13 Cryptocurrencies are viewed as a fundamental part of the future of the internet, allowing individuals to own their data and authenticate themselves in a world increasingly reliant on AI. The speakers discuss how this technology is challenging the centralized power structures of companies like Google and Facebook and potentially revolutionizing the financial system by creating digital scarcity and allowing for efficient, global settlements of transactions. Additionally, the speakers believe that crypto will be vital for the future growth of the internet and is poised for explosive growth over the next 10 years, surpassing $100 trillion in value.