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Hello everyone. I want to return to something that the chairman of the Federal Reserve, which is the largest central bank in the world, said. In fact, they are essentially the guardians of the world's reserve currency and have enormous global influence on financial affairs. I want to revisit something he said yesterday.
Now, I'm not sure when you're watching this video, so to put a date on it, on June 1st, 2025, he gave a speech in which he mentioned Bredon Woods. In fact, what I want to do for you is put the fragment. And the reason we're talking about this is because this not only has huge repercussions for us, specifically in the cryptocurrency space, but more broadly for the world in general, as we are about to witness the evolution of the monetary system, which if you use money—and I don't know of any place that doesn't, maybe some places in the Amazon or places like that—if you use money, this is going to affect all of you.
So what I want to do is put this clip of Jon Powell and what he had to say. It had emerged from World War II as a global economic superpower. The Bretton Woods agreement placed the United States and the Federal Reserve in a central position in the global economy. Our mission then, as it is now, was to serve the American people, but at that time it was clear that the Federal Reserve needed to have a better understanding of global developments in order to achieve the goals of our dual mandate.
A 1948 memorandum proposing the creation of the division stated, "The problems of international economics and finance have become increasingly large, complex, and significant in recent years, and our foreign economic relations will undoubtedly continue to give rise to issues of the utmost importance." That rare economic prediction that turned out to be completely accurate 75 years later.
It remains critical for the Federal Reserve to understand the policies and practices of other governments and central banks, as well as their implications for the U.S. economy and financial markets. Exchange rate policy, of course, is now firmly in the hands of the United States Treasury Department.
However, the end of the Bretton Woods era in the 1970s fundamentally changed the conduct of monetary policy, as policymakers had to understand the effects of potentially greater volatility. The end of the Bretton Woods era in the 1970s fundamentally changed the conduct of monetary policy, as policymakers had to understand the effects of potentially more volatile movements in the US dollar on American families and businesses.
Understanding global trade and capital flows has become increasingly important since 1950. Now, Jerome Powell, in that important speech, is talking about the Bretton Woods system, and that raises many questions, especially regarding how he compares it to the current situation or mentions its great relevance today.
And we all know, anyone who has an idea or even a little interest in the financial world and certainly in money, will know that there is an interesting dynamic at play with the monetary system, which is essentially a system of promissory notes backed by debt and really by faith. Know? You have to have faith in this system.
If everyone stopped believing in it, as happens with anything else, then it would cease to exist. But what he said was interesting, not only because of where we are today with our current financial system and its somewhat fragile nature , but certainly for me as a cryptocurrency investor because of how perfectly timed Bitcoin's introduction to the world was in 2008 following the financial crisis.
For those who don't know, the Bitcoin white paper was published on Halloween 2008, which is a rather curious date. We're not going to delve too deeply into that topic. And then, of course, the first block occurred in January 2009. Some of you may be wondering, what on earth is Bretton Woods? They should know what it is because it is basically the reason, or part of the reason, why we ended up with the monetary system we have today.
Bretton Woods took place after the world war. or after World War II, it took place in 1944 and Bretton Woods was basically where everyone met and essentially agreed on a dollar-based system, but a dollar system that was backed by gold. Then we had the Nixon shock that happened in 1971, where basically everyone more or less agreed because there was no other option that they were going to move away from a gold-backed currency.
because they did not have the gold to back the currency or to honor the essential receipts that were delivered in the form of dollars. This would have led to a massive bank run and a global economic collapse . So basically everyone shut up and agreed to move to the fiduciary systems we have today, and several things have happened since 1970 and one up to the present day.
However, where we are today is a very interesting crossroads with regard to the financial system, because we see that promissory notes in the form of debt, which essentially back money, are losing value at a record rate after COVID and nobody wants to get into them. Even with the type of tariff shock that markets have endured and the odds of recession increasing, the maximum uncertainty in the markets, which is normally quite good for the bond market as a safe haven, we have not yet seen these receive demand, suggesting an underlying problem in the bond market, which is the foundation of our financial system.
And the fact that Jerome Powell is talking about Bretton Woods and highlighting it in relation to the current situation is extremely interesting and, to me, suggests the arrival of a new monetary system. I believe it will be a global system in which distributed ledgers of cryptocurrencies will play a central role in making it possible.
We are witnessing the formation of the internet of value before our very eyes. We keep talking about this because it's going to directly affect everyone. Whether you're interested or not, we want you to be on the right side of history. Now I'm going to talk about the sort of divine nature or perfectly opportune moment when Bitcoin appeared on the scene and then gave rise to what will essentially be the new financial system in a while.
But I want to show you a clip of Jamie Diamond at the National Economic Forum , where he basically talks about our current system, which is actually a dollar reserve system, how he still believes the dollar could remain the reserve system, but that something needs to change drastically because the path it's taking is not sustainable and it could lose that status.
And I believe that will happen, although I do n't think the dollar will disappear. In fact, I think that with stablecoins and things like that, this will become more accessible and will solve some of the problems that currently exist, but that could be a topic for another video. Let's delve deeper into this clip about what Jamie Diamond of JP Morgan said at the World Economic Forum in Britain.
And then there is our debt, which you have just heard several people speak about eloquently. It's a big issue, and it's not just our case. We added $10 trillion in 5 years. We have, you know, there was Rean talking about the deficits. The debt-to-GDP ratio was 35% and the deficit was 3.5%. Today it is 100% debt relative to net GDP and a deficit of almost 7%, the highest in peacetime history.
I mean, the CBO does its calculations which I don't really trust. By the way, they should do a stress test, like, what happens when we go into a recession? That 7% will become 10%. So we have problems. And we have to face them, and then the biggest one underlying all of that is the enemy within. I 'm not that worried about China.
China is a potential adversary. They are doing many things well, but they also have many problems. What I'm really worried about is whether we can organize ourselves, our own values, our own capacity, our own management. What you heard on stage today was that the amount of mismanagement is extraordinary on the part of the State, the city, in pensions, and those things are going to be the end of us.
And you know, I always get asked this question, are we going to be the reserve currency in No, you know? If we are not the preeminent army and the preeminent economy in 40 years, we will not be the reserve currency. That's a fact. Just read the story. You know, now I think we will be. You know, Warren Buffett will tell you that we are incredibly resilient.
I agree with that. I think this time is different. This time, you know, we have to get our act together and we have to do it very quickly. That was a great answer. There's a lot to investigate there. So, I'll give you a geopolitical one. I also have a great phrase for the first one. Someone said, "The government spends like a drunken sailor." And someone else said, "No, a drunken sailor spends his own money." So there we have Jamie Diamond.
Basically, again, as you all know, Reay Dalio has written about this, certainly in regards to the debt collapse. In many cases, I don't think they will allow the debt to collapse, perhaps in value, but not in terms of people expecting a default. I believe they have the option to print money and they will.
That could lead to hyperinflation, which again is the reason why you should be in assets. Know? That's why this channel exists, because it has never been so urgent to have your reserves of value somewhere outside of the fiduciary systems that are at this kind of fragile point, at this conjunction, if you will, or at this crossroads.
And this is being pointed out by everyone, including the Federal Reserve, which can't come out and say it openly, but they are somehow doing it indirectly, certainly talking about where we are today and linking that to Bredon Woods, who we just explained to you what he is, and Jamie Diamond there. That fragment really aligns with what was said in the first half.
And this is where we get to the cryptocurrency space and its divine intervention, which I believe was more planned by the same people who were behind the Federal Reserve. It's not just a simple coincidence, and in fact I think there are comparisons between Bitcoin and the Federal Reserve system, which some of you may think is absurd.
However, what happened in 1907, and many people blamed JP Morgan for this, was a financial crisis that ultimately led to the need for stability, and that resulted in the Federal Reserve Act. Of course, before that there was the Aldrich Act, which was rejected due to fears about Wall Street involvement.
And then later they said something like, "Okay, we'll put it back in the hands of the people through the government and basically create the Federal Reserve Act, which, by the way, Mr. J.P. Morgan was primarily responsible for, and that's how we ended up with a sort of central banking monetary system.
There was a problem, a reaction, and then a solution. And today we see a problem with the financial system as we know it, pointed out by basically anyone who's anyone important. They just don't say it outright. Some do, but those like J.P. Morgan or the Federal Reserve do it indirectly. What we're going to see is a reaction, which we're probably already seeing with regard to the bond market, and then they're going to implement the solution.
The solution, which I believe is cryptocurrencies, which have been around since 2008 after the financial crisis. And I always refer to that newspaper clipping that was included in one of the first transactions by Satoshi Nakamoto, where he highlights a Times clipping that emphasizes that the chancellor is on the verge of a second bailout , referring specifically to 2008 and the first signs of cracks in the financial system.
And now what they 've given us is a new horse. I think Bitcoin is a Trojan horse to take the burden off the old one. If that makes sense. And this excites me, it's extremely interesting, and it should interest you because it's going to directly impact your life. In fact, this transformation will create winners and losers, and I want you to be the winners.
You have given me so much through this channel; the cryptocurrency market, being an investor for years, has truly changed my life. It allows me to be in beautiful places like this. And the interesting thing is that since then, we've seen Bitcoin remarkably accurate. We're not going to get into who Satoshi Nakamoto was or is .
We're just going to highlight the fact that it was incredibly timely, too much so to be a mere coincidence in my opinion. And since then, especially in recent years, we've seen the world's largest asset manager come out and recognize Bitcoin. We've seen the most successful ETF in history be a Bitcoin ETF.
And more generally, what Larry Larry F has said on several occasions, and we're going to include a snippet of this, that Bitcoin is almost like a lifeboat. It's a place people go when they're worried about the financial system, especially in relation to a specific currency. And I think this is guiding us toward that unified global system where everything operates on unified ledgers that are interconnected, and what we see is value being transacted around the world, just like information on the internet.
We're talking about WebD2DOS and Webtress. They're comparable, though not entirely in many other aspects, but on the internet, value is being formed right before our eyes, and with that, potentially, a huge opportunity. I certainly think there's an opportunity here, and that's why I've invested in many of these cryptocurrencies.
And what I want to do now is show you a clip so you can see we're not making all this up, from Larry F himself. In fact, we're going to show a sort of montage of him talking about this. Now, I know you've been a leader willing to embrace cryptocurrencies. Yes, you've made it possible for people to be in Bitcoin.
We've heard that you're thinking about Ethereum. These are incredible things, like now BlackRock isn't exactly known for being reckless, so obviously you have to believe this could be an alternative. Is this an alternative, uh, to be able to, because of the uh deficit, maybe something that people should have in the long run?
Absolutely. Uh, as you know, I was a skeptic. Yes, I was a convinced skeptic, and I studied it, I learned about it, and I came to the conclusion of saying, "Well, you know what?" My opinion from 5 years ago was wrong. This is my opinion today. This is what I believe in today. I believe in the opportunity that exists today.
I believe Bitcoin is legitimate. I'm not saying there aren't misuses, as with everything else, but it's a legitimate financial instrument that allows you to have perhaps uncorrelated or uncorrelated returns. I think it's an instrument you invest in when you're most afraid. However, that's correct, it's an instrument for when you believe countries are devaluing their currency, devaluing their currency due to excessive deficits, and some countries are doing that.
I think there are countries where you're afraid for your daily existence, and if you have the opportunity to invest in something that's outside your country's control, well, you know. Then you can have more financial control. So I'm a big believer that there's a role for Bitcoin in portfolios. I think you'll see that it will be one of the asset classes that we all consider.
I see it as digital gold, as I said before, and I truly believe there is a real need for everyone to consider it as an alternative to, I would say, optimism. So ladies and gentlemen, that's all from me. I hope you enjoyed this. I think finance often bores people. Certainly, if you learned it at university or school or whatever, I mean , I studied business at school and you know, I don't want to criticize the teacher or anything, but you know, I was asleep more than I was awake.
And I think that's the general education right now, and that might be a little unfair, you know? I have relatives who are teachers, they are good people, but I think the education system has flaws. And in my opinion, it's not really teaching people what they should be learning. And this is something that, again, will not only directly affect me as a cryptocurrency investor, hopefully in a positive way, but everyone.
A new monetary change is taking place. This is being pointed out by everyone who is anyone, and I am absolutely certain that the cryptocurrency space was essentially created to be the infrastructure on which all of this runs. Ladies and gentlemen, that's all from me. I send you all a hug and say goodbye.
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