In the clip below, Saifedean Ammous attempts to make the case against interest (riba) under a hard money standard (Gold and Bitcoin) from a secular perspective, without appealing to God or religion, using the Austrian school of economics.

This is  controversial because the Austrians are very pro riba / interest. They just don’t like a central authority dictating the interest rate but are perfectly fine with individuals selecting a riba rate amongst themselves.

Ammous argues that interest exists because people naturally prefer having things now rather than later. If you lend someone money, you usually expect something extra in return for waiting.

He says that richer and more advanced societies tend to have lower interest rates because people become more patient, save more, and think more long term. More savings means more money is available to lend, which naturally pushes interest rates down.

Ammous criticizes modern riba based fiat money and central banking, arguing that inflation encourages short term thinking and discourages saving. He believes that sound / hard money, such as gold or bitcoin (they are hard to create) , encourages people to plan for the future and build wealth.

The main question is whether interest / riba rates could ever naturally fall to zero.

He argues that this could happen in an extremely wealthy and stable society where there is so much savings available that lending money becomes almost free. He also points out that storing money itself has costs, so people might accept 0% interest rather than pay to store wealth safely.

His overall message is that civilizations become stronger when people save, invest, think long term, and delay gratification.

Michael Saylor doesn’t buy this thesis because he’s a riba merchant.

@saifedean