In this episode, Nik Bhatia and TBL Research Associate Demian Schatt unpack how the Federal Reserve actually influences the financial system—and who it serves. They discuss what happens mechanically when the Fed changes rates, why bond market expectations matter more than policy statements, and how the entire credit system is structured to resist deflation. Nik shares insights on the origins of the 2% inflation target, the fragility of the banking system, and how Bitcoin fits into a world built on rolling debt and central bank intervention. The conversation also touches on Larry Lepard’s The Big Print and the growing call for sound money in an era of frequent financial crises.

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Nik Bhatia's Twitter: https://twitter.com/timevalueofbtc

Creative Director Matthew Ball's Twitter: https://twitter.com/matthewrball

Researcher Demian Schatt's Twitter: https://x.com/demianschatt

Chapters:

00:05:10 Preventing Market Panic and Unemployment  

00:10:24 The Debate on Sound Money vs. Credit System  

00:15:40 The Inflation Target Dilemma

00:20:52 Understanding the Impact of Stock Prices on Financial Power

00:26:42 The Fed's Dual Stakeholders: Banks versus People  

00:31:35 Bitcoin's Impact on the Credit System

00:37:01 Understanding Credit Creation and Treasury Bills

00:42:23 The Federal Reserve's Balance Sheet Dilemma  

00:47:33 Understanding Bitcoin as a New Asset Class

The Bitcoin Layer and its guests do not provide investment advice.