Patrick McKenzie (patio11) explains the standard procedure for large withdrawals in bank branches, with particular focus on the viral story published in The Cut about a woman who withdrew $50,000 cash from a bank and handed it to scammers. Certain minor details in the article set off a year-long investigation where he identified the exact physical location of the bank branch in question, researched the context for the transaction using public records, and obtained new details through FOIA requests. His investigation reveals an underlying narrative that accounts for what actually happened, and provides a worked example for fact-checking in journalism.
–

Full transcript available here:
www.complexsystemspodcast.com/two-americas-one-50k-withdrawal/

–
Sponsors:  Safebase 

Ready to save time and close deals faster? Inbound security reviews shouldn’t slow down your team or your sales cycle. Leading companies use SafeBase to eliminate up to 98% of inbound security questionnaires, automate workflows, and accelerate pipeline. Go to safebase.io/podcast 
–
Recommended in this episode:

• Two Americas, one bank, and $50,000 cash https://www.bitsaboutmoney.com/archive/two-americas-one-bank-branch/ 
• The Cut, The Day I Put $50,000 in a Shoe Box and Handed It to a Stranger https://www.thecut.com/article/amazon-scam-call-ftc-arrest-warrants.html
• Kelsey Piper on Complex Systems https://open.spotify.com/episode/33rHTZVowaq76tCTaKJfRB
• Jim McKenzie on Complex Systems https://open.spotify.com/episode/6ocJirzGTStuf0K9ITM21X

–

Timestamps: 

(00:55) Suppose you ask a bank to withdraw $50,000 in cash

(07:55) Style magazines sometimes publish hard-hitting journalism

(12:36) Reaching out to Vox Media

(17:09) Sources of doubt
(17:55) Sponsor: Safebase

(22:30) The physical reality of bank branches

(25:53) In which we became acquainted with brisk walks across Brooklyn

(34:42) New York’s Finest foil FOIL for a time

Patrick McKenzie (patio11) is joined by Azeem Azhar, writer of the Exponential View newsletter, to discuss the massive data center buildout powering AI and its implications for our energy infrastructure. The conversation covers the physical limitations of modern datacenters, the challenges of electricity generation, the societal ripples from historical largescale infrastructure investments like railways and telecommunications, and the future of energy including solar, nuclear and geothermal power. Through their discussion, Patrick and Azeem explain why our mental models for both computing and energy systems need to be updated.
–
Full transcript available here: www.complexsystemspodcast.com/ai-llm-data-center-power-economics/

–
Sponsors:  Safebase | Check

Ready to save time and close deals faster? Inbound security reviews shouldn’t slow down your team or your sales cycle. Leading companies use SafeBase to eliminate up to 98% of inbound security questionnaires, automate workflows, and accelerate pipeline. Go to safebase.io/podcast

Check is the leading payroll infrastructure provider and pioneer of embedded payroll. Check makes it easy for any SaaS platform to build a payroll business, and already powers 60+ popular platforms. Head to checkhq.com/complex and tell them patio11 sent you.

–

Recommended in this episode:

• Azeem’s newsletter: https://www.exponentialview.co/ 
• Azeem Azhar’s guest essay: The 19th-Century Technology That Threatens A.I. https://www.nytimes.com/2024/12/28/opinion/ai-electricity-power-plants.html
• Electric Twin: https://www.electrictwin.com/ 
• Video of Elon Musk’s Colossus https://www.youtube.com/watch?v=Tw696JVSxJQ 
• Complex Systems with Travis Dauwalter on the electrical grid: https://open.spotify.com/episode/5JY8e84sEXmHFlc8IR2kRb?si=35ymIC0UQ5SKdV8rrBcgIw 
• Complex Systems with Austin Vernon on fracking: https://open.spotify.com/episode/0YDV1XyjUCM2RtuTcBGYH9?si=YshjUXPEQBiScNxrNaI-Gw 
• Complex Systems with Casey Handmer on direct capture of CO2 to turn into hydrocarbon: https://open.spotify.com/episode/0GHegWgLSubYxvATmbWhQu?si=xNYBjn0ZTX2IT_pAZ5Ozsg 

–

Twitter:

@azeem

@patio11

–

Timestamps:

(00:00) Intro 

(00:27) The power economics of data centers

(01:12) Historical infrastructure rollouts

(04:58) The telecoms bubble 

(06:22) Unprecedented enterprise spend on AI capabilities

(11:12) Let's have your LLM talk to my LLM

(16:44) Is there a saturation point?

(19:25) Sponsors: Safebase | Check

(21:55) What’s in a data center?

(24:52) The challenges of data centers

(29:40) Geographical considerations for data centers

(36:53) Energy consumption and future needs

(40:48) Challenges in building transmission lines

(41:35) The solar power learning curve

(43:51) Small modular nuclear reactors

(51:26) Geothermal energy and fracking

(01:01:34) The future of AI and energy systems

(01:12:57) Wrap

In this episode, Patrick McKenzie (@patio11) responds to a recent request by a crypto unicorn founder / bank CEO to retract his essay Debanking (and debunking?). Come for the note about editorial standards and independence, stay for the diss track. 
–

Full transcript available here: https://www.complexsystemspodcast.com/editorial-standards-and-independence/

–
Sponsors:  Safebase | Check

Ready to save time and close deals faster? Inbound security reviews shouldn’t slow down your team or your sales cycle. Leading companies use SafeBase to eliminate up to 98% of inbound security questionnaires, automate workflows, and accelerate pipeline. Go to safebase.io/podcast

Check is the leading payroll infrastructure provider and pioneer of embedded payroll. Check makes it easy for any SaaS platform to build a payroll business, and already powers 60+ popular platforms. Head to checkhq.com/complex and tell them patio11 sent you.

–

Recommended in this episode:

• Debanking (and debunking?): https://www.bitsaboutmoney.com/archive/debanking-and-debunking/
• CEO: Retract your debanking article? Me: No. https://www.kalzumeus.com/2025/02/10/retraction-request-denied/
• Geekiest rap single in history https://suno.com/song/c5ac7441-4a0b-4e5e-9c85-480e3ba63fc1 

–

Twitter:

@patio11

–

Timestamps:

(00:00) Intro

(03:04) Musical interlude

(04:56) Return to commentary

(06:35) You can’t please everyone

(08:06) The bar for retraction is high

(10:07) Our review of the retraction request

(10:37) “A few areas were incorrect or misleading”

(16:12) “Lots of omission of key facts”

(18:57) “Missing the point about what we mean by debunking”

(20:40) Sponsors: Safebase | Check

(25:00) Our response to McCauley’s testimony
(28:24) McCauley’s concluding remarks and our response
(30:21) Bank CEOs do not often ask writers for retractions

(34:20) Some context regarding custodial banks

(40:50) Returning to our regularly scheduled programming

In this episode, Patrick McKenzie (@patio11) is joined by Zeke Faux, investigative reporter at Bloomberg and author of Number Go Up, to discuss stablecoins and crypto fraud. They dive into Tether's controversial history, the senate’s emerging GENIUS act, and how crypto enables various types of financial crime. The conversation explores how Tether went from a “quilted collection of red flags” to becoming crypto's dominant stablecoin, its noteworthy relationship with Sam Bankman-Fried's FTX, and its current political maneuvering. They also discuss the societal value of financial regulation versus laissez-faire approaches to consumer protection.
–

Full transcript available here: www.complexsystemspodcast.com/zeke-faux-stablecoins-tether/

–
Sponsors:  Check

Check is the leading payroll infrastructure provider and pioneer of embedded payroll. Check makes it easy for any SaaS platform to build a payroll business, and already powers 60+ popular platforms. Head to checkhq.com/complex and tell them patio11 sent you.

–

Recommended in this episode:

• Number Go Up: https://zekefaux.com/
• Anyone Seen Tether’s Billions? Zeke Faux, Bloomberg Businessweek: https://www.bloomberg.com/news/features/2021-10-07/crypto-mystery-where-s-the-69-billion-backing-the-stablecoin-tether 
• Patrick’s review of Number Go Up: https://www.bitsaboutmoney.com/archive/a-review-of-number-go-up-on-crypto-shenanigans/ 
• Doesn't Matter, That's Reg E: https://suno.com/song/173bbd67-92f7-4868-930f-efeca4b373c0

–
Twitter:
@zekefaux
@patio11
–

Timestamps:
(00:00) Intro
(00:45) The GENIUS act of 2025
(02:28) Tether's audit controversy
(05:49) The origins and impact of Tether
(08:17) Investigative reporting and red flags
(12:58) Tether's shady business practices
(19:23) Tether meets SBF
(21:40) Sponsor: Check
(22:51) New anecdotes in the Number Go Up paperback
(28:53) The role of stable coins in crime
(38:20) The importance of AML and KYC rules
(44:21) Financial privacy
(45:18) Sam Bankman-Fried's conference in the Bahamas
(47:14) Loot NFTs
(49:34) Axie Infinity: a case study
(52:30) Crypto's real-world consequences
(58:15) Regulation and financial safety
(01:05:40) Stablecoin bill and ownership limits
(01:06:50) Political realignment and crypto
(01:14:40) Citizen journalists and the crypto-skeptic community
(01:20:36) The abilities and limitations of institutional journalists
(01:26:00) Wrap

Patrick McKenzie (@patio11) is joined by Travis Dauwalter, energy enthusiast (and PhD), to explain the systems we often take for granted behind the US electrical grid. The conversation covers how the grid maintains perfect supply-demand balance in real-time, the challenges of integrating renewable energy sources, and why America actually has three separate interconnected grids. Patrick and Travis weave through the economics of power generation, transmission line physics, and how data centers are reshaping energy markets. (Also, in a bit of a surprise, Patrick defends the honor of Bitcoin miners.)

–

Full transcript available here: complexsystemspodcast.com/electricity-grids-travis-dauwalter/

–

Sponsors:  Check

Check is the leading payroll infrastructure provider and pioneer of embedded payroll. Check makes it easy for any SaaS platform to build a payroll business, and already powers 60+ popular platforms. Head to checkhq.com/complex and tell them patio11 sent you.

–

Links:

• Utility Dive: https://www.utilitydive.com/ 
• The Bitter Lesson by Rich Sutton: https://www.cs.utexas.edu/~eunsol/courses/data/bitter_lesson.pdf 
• Austin Vernon on Fracking: https://open.spotify.com/episode/0YDV1XyjUCM2RtuTcBGYH9
• Casey Handmer on Solar Economics: https://open.spotify.com/episode/0GHegWgLSubYxvATmbWhQu 

–

Twitter:

@TravisDauwalter

@patio11

Travis’ LinkedIn: https://www.linkedin.com/in/travisdauwalter/ 

–

Timestamps: 

(00:00) Intro
(00:28) Understanding the energy grid
(02:22) The complexity of supply and demand
(05:43) Regional differences in energy grids
(08:16) Seasonal and daily energy demand
(11:22) Renewable energy and storage solutions
(17:17) Sponsor: Check
(18:29) Renewable energy and storage solutions (continued)
(24:07) Demand response and time of use rates
(34:08) Bitcoin mining and energy economics
(39:29) Exploring behind the meter arrangements
(40:44) Transmission line challenges and innovations
(45:51) Dynamic line rating and grid efficiency
(50:58) Data centers and energy demand
(58:33) Interconnection queue and grid security
(01:03:38) Understanding the US grid structure
(01:09:46) Wrap

In today’s episode Patrick McKenzie (@patio11) examines a Chicago casino investment, first of its kind within the city limits. Patrick reads from his Bits About Money essay (published January 2025) with additional commentary based on recent developments. The discussion reveals how municipal politics, grievances about national and local economic history, and creative financing intersect for ‘a very Chicago gamble.’ 

–

Full transcript available here:
www.complexsystemspodcast.com/the-landmines-buried-in-the-fine-print-of-chicagos-new-casino-deal/

–

Sponsors:  Vanta | GiveWell | Check

Vanta automates security compliance and builds trust, helping companies streamline ISO, SOC 2, and AI framework certifications. Learn more at https://vanta.com/complex

Support proven charities that deliver measurable results and learn how to maximize your charitable impact with GiveWell. Go to givewell.org (and type in "Complex Systems" at checkout).

Check is the leading payroll infrastructure provider and pioneer of embedded payroll. Check makes it easy for any SaaS platform to build a payroll business, and already powers 60+ popular platforms. Head to checkhq.com/complex and tell them patio11 sent you.

–

Links:

• Bits About Money: https://www.bitsaboutmoney.com/archive/chicago-casino-investment-offering/ 
• The Story of Vaccinate CA: https://worksinprogress.co/issue/the-story-of-vaccinateca/ 
• The Conservative Investor: https://www.patreon.com/theconservativeincomeinvestor 
• Complex Systems interview with Jim McKenzie: https://open.spotify.com/episode/6ocJirzGTStuf0K9ITM21X?si=7HA0RhEOS8GFsA1MlY-EVw

–

Twitter:
@patio11

–

Timestamps: 
(00:00) Intro
(01:43) Chicago has wanted a casino for a long time
(04:55) The stock offering
(10:29) Chicago’s peculiar definition of minority
(14:04) Sponsors: Vanta | Check
(16:26) Reading a complex corporate structure
(20:29) Is this valuation a gift to investors?
(23:20) Capital stack arbitrage
(30:04) The casino will not distribute profits, per se
(32:45) Tax consequences of this offering
(38:34) In conclusion

Patrick McKenzie (@patio11) revisits his March 2023 essay that explained the dynamics of bank runs and system stress during the banking crisis one month prior. With data from a newly released Federal Reserve paper, he analyzes the true scope of the banking stress - including revelations that 22 banks experienced severe deposit outflows, far more than publicly known at the time. While officials blamed social media for bank runs, data shows institutional players, not retail depositors, drove the events. 

–

Full transcript available here: www.complexsystemspodcast.com/banking-crisis-two-years-later/

–
Sponsors:  Vanta | GiveWell | Check

Vanta automates security compliance and builds trust, helping companies streamline ISO, SOC 2, and AI framework certifications. Learn more at https://vanta.com/complex

Support proven charities that deliver measurable results and learn how to maximize your charitable impact with GiveWell. Go to givewell.org (and type in "Complex Systems" at checkout).

Check is the leading payroll infrastructure provider and pioneer of embedded payroll. Check makes it easy for any SaaS platform to build a payroll business, and already powers 60+ popular platforms. Head to checkhq.com/complex and tell them patio11 sent you.

–

Links:

• Bits About Money: https://www.bitsaboutmoney.com/archive/banking-in-very-uncertain-times/
• Federal Reserve Report: Tracing Bank Runs in Real Time https://www.newyorkfed.org/research/staff_reports/sr1104.html 
• Byrne Hobart’s blog The Diff: https://www.thediff.co/ 
• Matt Levine’s blog Money Stuff: https://www.bloomberg.com/account/newsletters/money-stuff 

–

Twitter:
@patio11

–

Timestamps: 
(00:00) Revisiting the March 2023 essay
(01:47) The Fed's study
(11:21) Why are banks failing?
(14:41) A useful heuristic from bond math
(18:05) Sponsors: Vanta | Check
(21:00) Maturity transformation
(29:54) Sponsor: GiveWell
(30:42) Liquidity problems are the proximate cause of bank failures
(33:43) Trying to forestall a banking crisis
(40:16) Deposit insurance expansion
(47:12) Deposit insurance has some legacy issues
(52:04) What would happen if my bank were to go into receivership this weekend?
(59:46) What should users of the banking system do?
(01:04:09) Parting thoughts
(01:05:08) Footnote

In this episode, Patrick McKenzie (@patio11) unpacks his 24k word essay Debanking (and Debunking?) originally published on Bits about Money. He discusses the contours of recent debanking claims made by the crypto community, notably Marc Andreessen, Nic Carter, and explains how banking actually works as infrastructure rather than conspiracy.  The conversation moves from Operation Chokepoint's documented history to current claims about coordinated action against certain industries, while highlighting how banking access challenges disproportionately affect those who are "relatively less resourced, relatively less educated."

–

Full transcript available here:
www.complexsystemspodcast.com/debanking-patrick-mckenzie/

–
Sponsors:  Vanta | GiveWell | Check

Vanta automates security compliance and builds trust, helping companies streamline ISO, SOC 2, and AI framework certifications. Learn more at https://vanta.com/complex

Support proven charities that deliver measurable results and learn how to maximize your charitable impact with GiveWell. Go to givewell.org (and type in "Complex Systems" at checkout).

Check is the leading payroll infrastructure provider and pioneer of embedded payroll. Check makes it easy for any SaaS platform to build a payroll business, and already powers 60+ popular platforms. Head to checkhq.com/complex and tell them patio11 sent you.

–

Links:

• Debanking (and Debunking?) https://www.bitsaboutmoney.com/archive/debanking-and-debunking/ 
• a16z's Debanking explainer: https://a16zcrypto.com/posts/article/debanking-explained/

–

Twitter:
@patio11
@eriktorenberg

–
Timestamps:
(00:00) Intro
(00:19) Marc Andreessen's debanking claims
(01:02) Understanding debanking and its implications
(02:18) Crypto enthusiasts' perspective
(07:43) Operation Chokepoint: A historical context
(18:09) Sponsors: Vanta | Check
(20:23) Operation Chokepoint 2.0: The present day
(22:12) The fall of Silvergate Bank
(29:55) Crypto advocates and Silvergate Bank
(30:45) Sponsor: GiveWell
(31:43) Understanding bank account closures
(32:35) Bodegas and money services businesses
(36:38) Crypto companies and credit risk
(47:24) Debanking and its broader implications
(49:24) Political ramifications and free speech
(59:27) Wrap

–

Complex Systems is part of the Turpentine podcast network.

In this special episode, Patrick McKenzie (@patio11) and his EA/producer Sammy Cottrell examine the production function behind Complex Systems, from studio logistics to transcript annotation and guest selection. They reflect on their most memorable episodes while discussing the podcast's core mission of making complex systems more legible and ensuring valuable content remains freely available on the internet. The conversation explores the subjective best episodes from 2024, plans for the year ahead, and how LLMs might transform both the systems they study and how we write about them.
–

Full transcript available here: https://www.complexsystemspodcast.com/2024-year-in-review-sammy-cottrell/

–

Sponsor: Vanta | GiveWell | Check
 
Vanta automates security compliance and builds trust, helping companies streamline ISO, SOC 2, and AI framework certifications. Learn more at https://vanta.com/complex

Support proven charities that deliver measurable results and learn how to maximize your charitable impact with GiveWell. Go to givewell.org (and type in "Complex Systems" at checkout).

Check is the leading payroll infrastructure provider and pioneer of embedded payroll. Check makes it easy for any SaaS platform to build a payroll business, and already powers 60+ popular platforms. Head to checkhq.com/complex and tell them patio11 sent you.
–
Links:

• Ricki Heicklen on Complex Systems: https://open.spotify.com/episode/11kEUYRn4gXZGju232hzcg
• Casey Handmer on Complex Systems: https://open.spotify.com/episode/0GHegWgLSubYxvATmbWhQu
• Dan Davies on Complex Systems: https://open.spotify.com/episode/5QKxzgumJXSQuaWCmYAoM9
• Zvi Mowshowitz on Complex Systems: https://open.spotify.com/episode/4itdtJFLCpLQNd2g1zTtdD
• Ross Rheingans-Yoo on Complex Systems: https://open.spotify.com/episode/4GiO0KYqxJNCIdltCyhN6m
• Patrick’s talk at Manifest 2024 (Manifold): https://www.youtube.com/watch?v=vfiiXq_bE1c 
• Article mentioned - ‘50K in a Shoebox’: https://www.thecut.com/article/amazon-scam-call-ftc-arrest-warrants.html
• Copenhagen theory of culpability: https://laneless.substack.com/p/the-copenhagen-interpretation-of-ethics 

–
Twitter:
@patio11
@haththerescuer
–

Timestamps:
(01:04) Introducing Sammy
(01:37) The offscreen symphony behind Complex Systems
(07:19) Production supply chain and transcript philosophy
(08:40) LLMs of choice
(15:11) Sponsors: Vanta | Check
(21:21) Favorite episodes
(25:49) Sponsor: GiveWell
(27:15) Beyoncé
(28:47) More subjectively favorite episodes
(32:34) Thesis of Complex Systems
(34:07) Canon in operations research
(40:51) Sabbatical mode
(48:52) Bits about Money and other writing in 2024
(51:22) On paywalls and not implementing them
(54:29) LLM plans for 2025
–

Complex Systems is part of the Turpentine podcast network.

In this episode, Yatharth (@askyatharth), a graduate student and software engineer, turns the tables to interview Patrick McKenzie (@patio11) about cultural codes, writing, and AI. Patrick shares how his early experiences fighting credit report errors and navigating cross-cultural business environments led to his distinctive approach to understanding and writing about institutional systems. The conversation spans from Patrick's methodical exploration of banking infrastructure to his predictions about LLMs, weaving in personal stories about dating, parenthood, and bridging American and Japanese cultures along the way.
–

Full transcript available here: www.complexsystemspodcast.com/outside-view-yatharth/

–
Sponsor:  Check

Check is the leading payroll infrastructure provider and pioneer of embedded payroll. Check makes it easy for any SaaS platform to build a payroll business, and already powers 60+ popular platforms. Head to checkhq.com/complex and tell them patio11 sent you.

–

Links:

• Yatharth’s writing https://itsyatharth.substack.com/
• Rules for Radicals by Saul Alinsky https://en.wikipedia.org/wiki/Rules_for_Radicals 
• Dave Kasten on Complex Systems https://open.spotify.com/episode/66SSmxK2Kpyef7WUxXxS6w?si=5EZYfZ7gThG8WV7hSs1aFQ
• Lars Doucet on Complex Systems https://open.spotify.com/episode/2XQjSGCfW6XIu1AFB4oZeR?si=n3C28PymT6m7pPqFb2NE8Q
• Bits about Money: https://www.bitsaboutmoney.com/ 

–

Twitter:
@askyatharth
@patio11

–
Timestamps: 

(00:00) Intro
(01:30) Patrick's early interest in credit cards
(03:53) Navigating financial challenges
(05:10) Becoming a financial advisor
(10:35) Cultural and educational insights
(18:57) Sponsor: Check
(22:14) Personal stories and reflections
(25:48) Parenting and cultural integration
(33:26) Writing and storytelling journey
(37:35) Translating financial systems for a new audience
(39:08) The role of AI in writing and style transfer
(40:46) The concept of alpha in writing
(44:48) Legal advice and AI's role
(52:12) The impact of AI on bureaucratic systems
(01:04:22) Reflections on government software and policy
(01:13:49) Sabbatical insights and future interests
(01:18:52) Wrap

–

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