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A big “huh?” moment in crypto regulation
Jun 9, 2022
Episode 690

A big “huh?” moment in crypto regulation

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Whatever you do, please consult with your financial adviser.

This week, U.S. Sens. Cynthia Lummis of Wyoming and Kirsten Gillibrand of New York introduced a bill to regulate cryptocurrencies. Then, they went on TV pumping up bitcoin. We’ll explain why that’s not cool, starting with the fact that, according to her financial disclosures, Lummis is a big-time crypto investor. Consult your own financial advisers, and think twice before investing in crypto via your retirement account. Plus, tonight’s Jan. 6 committee hearings are this generation’s Watergate moment. Will you be watching? And, are UFOs real? NASA wants to find out.

Here’s everything we talked about today:

We’d love to hear from you. Let us know what you think about today’s show or anything else that’s on your mind. You can reach us at makemesmart@marketplace.org and (508) 827-6278 or (508) U-B-SMART.

Make Me Smart June 09, 2022 transcript

 

Note: Marketplace podcasts are meant to be heard, with emphasis, tone and audio elements a transcript can’t capture. Transcripts are generated using a combination of automated software and human transcribers, and may contain errors. Please check the corresponding audio before quoting it.

 

Kai Ryssdal: Of course you are. Oh, there we go. There we go.

 

Kimberly Adams: Hello, everyone. I’m Kimberly Adams and welcome back to Make Me Smart where we make today make sense.

 

Kai Ryssdal: I’m Kai Ryssdal, thanks for being here on a Thursday. We’re gonna do some news, do a little make me smile and get on about things. I guess we’ll do the news. Should we do the news?

 

Kimberly Adams: Yes, let’s do the news.

 

Kai Ryssdal: I’ll tell you what, I’ll go first because I’m gonna have commentary on some of the things you were talking about.

 

Kimberly Adams: Okay.

 

Kai Ryssdal: So this morning on CNBC an amazing thing happened. And we’re just gonna play the tape. It’s Senator Lummis and Senator Gillibrand. Andrew Ross Sorkin had asked a question in which he said, so look, it has been proposed by Fidelity, first of all, that people be allowed to put crypto in their retirement. And the Department of Labor and many others, Ross Sorkin said, have said that’s a terrible, terrible idea. And Senator Lummis answered, and we’re just gonna hit this tape. Here you go.

 

Cynthia Lummis: I think the Labor Department’s wrong, I think it’s wonderful idea, it should be part of a diversified asset allocation. And it should be on the end of the spectrum of a store of value. Obviously, if you have a fully diversified asset allocation, you will have some assets that you want to produce income in the short run, you also want some assets that are just a store of value. And I think that’s where Bitcoin really shines. I think it’s some of the hardest money that’s ever been created in in the world. And for that reason, it belongs as a slice of a diversified asset allocation for retirement funds.

 

Anchor: Senator Gillibrand, do you agree or disagree?

 

Kirsten Gillibrand: No, I agree.

 

Kai Ryssdal: Okay, so, holy cow, holy cow, holy cow, holy cow, holy cow. Let me count the ways in which that statement is just cray cray. Number one, the idea that Bitcoin right now is a store of value just flies in the face of the facts, right? Bitcoin is incredibly volatile. It’s down umpteen percent, since its high of like at least 50%. Right? Its high was $64,000. Now it’s like around 30. Right? Consult your own financial advisor. I’m going to get that tattooed on my forehead. But please think twice before you put crypto in your retirement. Number one. Number two, and this is actually, okay, I’m gonna say it, deceitful part of this. On her financial disclosure forms that senators are required to file, Senator Lummis listed on her 2021 form, an investment in cryptocurrency of between $100,000 and $250,000 okay? Senator Lummis is what is known as long Bitcoin. She has invested her real actual money in Bitcoin, and here she is, pumping up Bitcoin to regular investors (although regular investors probably don’t watch a lot of CNBC but that’s a whole different thing), to regular people saying they should buy it. That is not cool. And Gillibrand, I mean, come on. I can’t.

 

Kimberly Adams: So she has a vested interest in Bitcoin continuing to perform well in the long term. And this is the person who’s helping write the legislation to regulate Bitcoin.

 

Kai Ryssdal: It’s just unbelievable. Unbelievable. And I just… I tried to get it in Marketplace today, but we didn’t have enough room and whatever. So it goes here. And and tell your friends because, man! Anyway, that bugged me all day. It’s been bugging me all day.

 

Kimberly Adams: With any extraordinarily volatile and high risk thing, if you’re gonna put money in it, put in money that you can afford to lose, and your retirement is generally not money you can afford to lose.

 

Kai Ryssdal: No.

 

Kimberly Adams: Oh, boy. Oh, boy.

 

Kai Ryssdal: So that’s my news.

 

Kimberly Adams: I didn’t see that that Wow. Okay.

 

Kai Ryssdal: That’s what I’m saying right? I mean, come on.

 

Kimberly Adams: It’s a lot. It’s a lot. And you know, there was a letter that went out from like, what is it, the Bitcoin Alliance? There’s an industry and trade group that is supportive of Bitcoin, and they’ve been out talking, saying look, for all of its issues there, Bitcoin can be really helpful. When you think about regulation, let’s think about some of the good that bitcoin does. For example, because of Bitcoin and cryptocurrencies, people were able to flood money into Ukraine to support the war effort, you know, and that was really helpful. Political dissidents in different countries that can’t use their regular banking system because of authoritarian regimes that are tracking them down. They can get their funding through Bitcoin and cryptocurrencies and that is helping them stay afloat in very difficult situations. And so they’re highlighting the way that this can be used for good, too. But this is not, okay? So just very quickly, I’m gonna get my popcorn and Old Bay and my glass of red wine and sit down to watch the hearings tonight, I encourage everyone to watch the hearings from the House Select Committee investigating the attack on the US Capitol on January 6, 2021. That’s happening in prime-time tonight. If you miss it, it’ll be on C-SPAN and probably everywhere. This is a real important moment for us as a country. I was listening to the BBC this morning, and I guess it was Norman Ornstein who had the piece in The New York Times today, the Op-Ed, and he was saying that this is really important and a chance for us to, you know, have real accountability. And it sort of sent me down this mental rabbit hole of, okay, let’s just say that the Select Committee has enough evidence to reliably accuse former President Donald Trump of crime, enough that they refer to the Department of Justice, for him to be charged with a crime. I’m just imagining how it’s gonna go when they try to arrest him, or try to put him on trial. And knowing what his supporters did on January 6 2021, and there’s a real risk here of violence, of severe political unrest. But if there is not real accountability for what’s happened, what does that mean for our democracy? So it’s important to watch, it’s important to be thoughtful, and, you know, if we’re going to be a nation, that is, a rule of law, you know, this stuff matters.

 

Kai Ryssdal: Absolutely.

 

Kimberly Adams: Speaking of our democracy, I shall read for you today. You know, just because I guess I’ve been on an Amendments kick lately. You know, we talked about the Sixth and the Second Amendment last week. So today, I want to talk about the Fourth Amendment, the right of the people to be secure in their persons, houses, papers and effects against unreasonable searches and seizures shall not be violated, and no warrants shall issue, but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the person or things to be seized. Commonly known as the amendment protecting you from unwarranted search and seizure. This is, you know, what spawned the Miranda rights, which means that in general, police and federal officials can’t just randomly go into your house, beat you up or arrest you. Okay, that leads me to a ruling from the Supreme Court yesterday, that has made it more difficult for US citizens to bring lawsuits against federal employees who violate those rights. And this is a piece in Government Executive. Vox has a really good explainer on it as well. This case had to do with a really shady dude on the Canadian border, who was probably doing and very likely doing some really illicit stuff in overtime. But in this particular incidence of Border Patrol person, a Border Patrol agent, a federal law enforcement agent, went onto his property, tried to interrogate somebody. And he, this person, got in the way, and he got shoved and beat up by this border patrol agent, right? One could argue this is a violation of the Fourth Amendment. The court has decided basically that you can no longer individually sue federal law enforcement officials, particularly Border Patrol agents, if you believe they violated your Fourth Amendment rights. Now there’s a lot of detail to this ruling and nuance and context, and I encourage you to go and read some of these pieces, especially the Vox piece that really gets into it. But in particular, if you’re talking about Border Patrol agents, many of them have authority up to 100 miles from the US border, right? And so in Sonia Sotomayor’s dissent, she’s like, so basically what we’re saying here is that anywhere within 100 miles of the border, US federal officers can enter someone’s home without a warrant, or, you know, assault somebody, and they cannot be individually sued for violating those rights, which was something that used to be allowed. And so, as she laid out in her dissent, what’s the point of the Fourth Amendment if there’s no enforcement mechanism for it? So this is happening, this is happening. And it’s important to be aware. And, you know, when the court does something like this, it then turns to Congress to actually put into law something different. And now, Congress will have to do that if we want something different.

 

Kai Ryssdal: Except Congress doesn’t really do much. But that’s a whole different conversation. I know. I know. I know. I know. We aren’t gonna talk about it. We’re gonna do Tuesday on that.

 

Kimberly Adams: Yeah, we’re gonna do Tuesday on that. Yeah. But you said you had some something to say about, I’m guessing about January 6?

 

Kai Ryssdal: I’m guessing about January 6. And I alluded to this the other day, and I really hope that those of you with young people in your households, encourage them to watch. Because as I said the other day, it is a memory of mine from forty-whatever-the-hell years ago it is, of watching this at my grandparents’ house. And I would argue that this is as important… I was hearing some analysis today, that says, Oh, this is as important as the Trump impeachment hearings. I would suggest that this is actually as important as Watergate. It’s more important than the Trump impeachment hearings. It’s as important as Watergate for what it means for this democracy. And it is vital that we remember. And the way we remember is by watching and seeing and taking it in and then talking about it. For all the reasons that Kimberly laid out, but also just because we have to know. We have to know so that it doesn’t happen again. That’s my spiel.

 

Kimberly Adams: I’m torn between whether I want to watch it on, like not actual Fox but the secondary Fox where it’s going to run, or if I want to watch it (yeah Fox Business) or if I want to watch it on PBS. A part of me wants to watch it on Fox Business just to see how it’s presented in that platform. Because you can always glean so much from the chyrons, the writing… of the Fox audience that chooses to watch. They’ll probably be watching it there, even though they won’t be running it on their main network. And I think there’s value. I was on Fox’s website this morning looking at their January 6 page and it’s straight ahead. The website, the page that they have setting up the hearings, you wouldn’t probably be able to distinguish it from any other news site. Now the front page obviously is a whole other thing. I remember when I was an intern at Fox, like the journalists they were working so hard to live up to the fair and balanced thing. Now granted, this was like years and years and years ago. And it was fascinating over the years to watch the people who I used to work with, who took such pride in their work, just slowly but surely leave the network, because they just couldn’t anymore.

 

Kai Ryssdal: Yeah, because they can’t anymore. They can’t. And it’s tough to say, actually. Well, you can’t really say Fox News is journalism stuff anymore, right? It’s propaganda and posture. And lies. And lies.

 

Kimberly Adams: I mean, but then you still have some journalists there, you know, some of which I’m hoping to talk to eventually. Who are doing really solid work, like Chad Pergram, who has been covering Capitol Hill for years and years and years and this is a straight ahead, solid-as-they-go journalist. He works at Fox News Radio and sometimes goes on air.

 

Kai Ryssdal: That’s what I was gonna say. He’s not Fox News. The Fox News, that is Bret Baier, and you know, Martha MacCallum and all of those people who get the big prime-time programming and which Fox News Channel is allowing to counter program the January 6 hearings right? That’s what’s happening.

 

Kimberly Adams: Yeah.

 

Kai Ryssdal: Make Me Smile, shall we? I’m kind of surprised you did not pick this one, Kimberly Adams. I’m kind of surprised.

 

Kimberly Adams: I was torn. I really was. But I wanted like, my Make Me Smile I originally had as my news fix, but I wanted to fit all of my things into the news fix so I move this to the Make Me Smile. That’s what happens.

 

Kai Ryssdal: That’s some strategic Make Me Smart here. That’s some strategic Make Me Smart. So let me say just as a way to set this one up, that Kimberly and I are both space geeks. We both enjoy space. We had a very brief exchange yesterday on Slack about – and this was truly almost terrifying – a micrometeorite hit on the Webb… one of the Webb mirrors, we talked about the Webb space telescope, right? And that could be really bad. Also also, the rover on Mars has like gotten a rock stuck in its wheel.

 

Kimberly Adams: A pet rock!

 

Kai Ryssdal: Right, it’s great. So anyway, so I saw this one today. And I was like, oh, Kimberly will have grabbed this already. But lo and behold, I went to the rundown, and she had not. So two things about this. One, it exists. And then another item, which I’ll get to in a minute. NASA has started a scientific study to find out if UFOs exist okay, which is great. And I’m really glad that the shame of UFO belief has been punctured. Thank you, Harry Reid and everybody who has worked for years. Because, look, my belief is that it’s not it’s just not possible that we are alone in the universe. It’s just not, right? So of course UFO…

 

Kimberly Adams: …would be a waste of space?

 

Kai Ryssdal: Right? I mean, it just, it just stands to reason. It can’t possibly be the world alone in the universe. So this is great. The catch, of course, is that NASA is going to spend, oh my gosh, $100,000. I mean, you can’t get a rover wheel for $100,000, forget studying UFOs. So do better NASA! It’s all I’m saying. Do better. But good that they’re studying.

 

Kimberly Adams: I mean, does that even pay the salary of a NASA scientist?

 

Kai Ryssdal: No, no.

 

Kimberly Adams: Or maybe it was like, pay for like a one a couple luncheons, or like a conference or something.

 

Kai Ryssdal: Some meetings or something. Yeah, for sure. For sure.

 

Kimberly Adams: Okay, mine is like, probably the thing that parents all over this country have been waiting for. The White House finally finally finally says it’s going to be rolling out a vaccination program for the youngest kids. And it’s been something like. Parents of small children have really just had it, kids under five. And so the White House is saying that, you know, these vaccinations could start as early as the week of June 20. And then that program is going to be ramping up as more doses are delivered, more appointments are becoming available. And it’s fascinating how they’re rolling out these vaccines, and Bridget was looking at this and highlighted this to me: vaccinations are going to be available – I’m reading here from the White House factsheet – at pediatricians and other doctors offices, of course, community health centers, rural health clinics, children’s hospitals, public health centers, all the places where you might imagine that. But also in like, other places, like, you know, museums! Head Start program, Department of Housing and Urban Development, and all these other cool places where like, within the national diaper bank network. Things where you might have people want to go and take their kids and make it kind of a fun thing, especially when you know kids might be scared of shots. So yeah, I think that’s really cool.

 

Kai Ryssdal: No, it is cool. And yay for all those parents out there.

 

Kimberly Adams: Yeah, yeah. There we go. All right. That’s it for us today. Kai and I will be back tomorrow with Economics On Tap. We will do the YouTube live stream. That’s at 6:30 Eastern where I am, 3:30 Pacific where Kai is on the other side of the country. And we will have more news, a game, drinks, I’m going to bet with a very large degree of certainty that I want to talk about what went down at the hearings.

 

Kai Ryssdal: Oh, yeah, for sure. For sure. For sure. No question about it. In the meanwhile. Send us your thoughts, your comments, your questions, your observations, your compliments, your critiques, be gentle. Email us makemesmart@marketplace.org Leave us a message if you like, 508-U-B-SMART. It’s either a voice memo or a voicemail, but I’m just gonna call it a message. Thank you Bridget for changing that in the rundown. I appreciate that.

 

Kimberly Adams: I think that works.

 

Kai Ryssdal: Yeah, I think it does. I feel seen.

 

Kimberly Adams: Make me smart is produced by Marissa Cabrera. Olivia Zhao is our intern. Today’s episode was engineered by Juan Carlos Torrado.

 

Kai Ryssdal: Bridget Bodnar is in charge of this podcast.

 

Kimberly Adams: And sees you.

 

Kai Ryssdal: Donna Tam is Director On Demand. That’s right. Bridget sees me.

 

Kimberly Adams: Hears you, values your perspective and insights.

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