Welcome to Free Thoughts from Libertarianism.org and the Cato Institute. I'm Aaron Powell. And I'm Trevor Burrus. And today we're joined by Edward Peter Stringham. He's the Davis Professor of Economic Organizations and Innovation at Trinity College and the author of the new book, Private Governance, Creating Order in Economic and Social Life. So most of our listeners hear the term governance. They probably think of government, of the public sort. So let's start with what you mean by private governance. Well, I want to thank you and Trevor for inviting me on the show. I talk about governance to refer to rules and regulations, whether they're formal rules or whether they're informal norms or even just completely informal mechanisms that people use to try and do things like facilitate exchange or protect property rights. Most people assume that government needs to do those things, protect property rights and enforce contracts. But historically what I found, tons of examples of private parties doing that without relying on the state, without relying on the use of force. And I refer to that as private governance. Would government be a form of governance with some different qualifications to it? Yeah, I guess one could use the word that way. I like to distinguish between governance, private governance as distinct from what we could call coercive government. Most people don't use the term private governance, so I'm trying to use it as distinct from government. But yeah, if you want to use the word govern in that broad sense, surely you could say there's different ways of governing, whether it's through private voluntary means or through coercive state means. Now there are a lot of rules in a lot of situations, there are rules in the family and there's rules about walking down the street or going to the swimming pool. People wouldn't say that there are an absence of rules out there. So is the question here basically where the rules come from or are we looking at social rules or who enforces them or any type of rule is fair game here? Yeah, so I would say that's exactly right and there's tons of rules in society that come from all types of sources independent of government. The government uses a certain way of enforcing them. Private parties can create rules and enforce rules in all different ways, whether it's the rules of a family. When you're under my house you follow my rules to the rules of a college, the rules of a company. There's plenty of rules in society that people follow that are independent of government. And so I think that's the issue and the aspect that I'd really like to highlight to people. Do you think that there's a bias in the way that people think about rules toward sort of thinking about them as only coming from government or government like things? Yeah, definitely. So the government always tells people that it exists to protect their property rights or facilitate exchange. And so people basically assume that that's what they're doing and assume that without government those things could not take place. But if you look around historically and in modern times, there's tons of examples of people interacting independent of government in certain cases at the edges of government or in other cases operating in societies with government, but government choosing not to enforce certain rules or government being unable to enforce certain rules. And nevertheless, you see private rules and regulations that are there regardless of what the state is doing. So yes, most people just assume, oh, there's a contract, it must be because of government or a lot of people assume the corollary of that. Without government you can't have contracts. And what I'd like to highlight is that just completely false. So this bias in favor of at least thinking we need public governance, we need the state to get involved, is it limited to, I guess, certain categories of rulemaking or is it more, is it based on, I guess, importance? So the question is people, there seem to be certain areas where we don't, it would never occur to us to ask the state to get involved, like if we're kids making up the rules of a game on the playground, we don't tend to think that the federal government should do that. At least not yet. Maybe. Right. So is the distinction there that stuff that is really important, because arguably the rules of the game on the playground are not all that important, we tend to say, well, if it's really important, then public governance is what we need or is it that there are just specific categories where kind of independent of the importance, so whether it's contracting or property exchanges or whatever, we think public governance is the way to go, period. Yeah, so I think that the rules of the playground are a great example. You in theory could have the federal government enforcing those rules. You in theory could have the local town police enforcing those rules. But historically, a lot of people, psychologists have said it's better to let kids kind of within reason, figure out how to play nice on their own, not be a helicopter parent. So that is a choice of socialization that most people recognize. There are exceptions, however. So there's cases where the federal government is increasingly getting involved with different types of private rules that historically were done not through the state. In many jurisdictions, they're starting to impose sexual harassment laws to seven-year-olds and all types of things.   And the government, unfortunately, in my opinion, has become increasingly involved with that. Well, does it seem to be the case to Aaron's question that when people start to think something is really important, or maybe they just start to think something is not going the way that they happen to prefer it's going, such as campus sexual relations, then that's when they call government in to change public government. Yeah. So Adam Smith referred to certain people as the man of system who like to manipulate people as if they're pieces on a chessboard. And I think, unfortunately, there's a lot of people who like to do that. And so many people will look out in society, they'll observe something that they might not like. And then they say, OK, well, let's just pass a law. And I'm going to mandate my preferences or my ideal way of doing things on these people, oftentimes not really thinking about whether it's going to be effective or thinking about whether it's going to have certain unintended consequences. So yes, there is this tendency, which I refer to as legal centralism. And that's the idea that all order comes about because of the state. And people who are legal centralists, whenever they observe problems in the world, will then say, well, we need to have additional rules and regulations to deal with them. And Oliver Williams in the Nobel Laureate from 2009 questioned that worldview. And he said, there's all different ways of enforcing contracts, facilitating exchange. And we need to really move beyond the idea that government is going to be able to solve problems in a low-cost way. So I like to highlight that government enforcement at a minimum is costly. Sometimes they don't have the incentive to solve a problem or the knowledge to solve a problem. And so many unmet needs are going to exist. And that leaves private parties with the decision of either doing nothing, dealing with the problem, or trying to find ways to solve it privately. The unmet needs is a really interesting example that a lot of people don't think about, that there's just a level where you just don't sue or there's a level where you don't call the cops at all because you know they're not going to do anything. My favorite example of that in a movie is a part in Big Lebowski where he asked the cops if they have any leads on finding his eight-track tapes that are missing. And the cop laughs at his face and he says, leads? That's all we got, the guys in the crime lab, they're working in shifts. And everyone laughs at it because they know that the cops just will not do anything in that situation. So maybe we have to reconceptualize what cops actually do. Yeah. So even when there's a potential threat to property and one calls the police, they have a prioritization scheme where they will say, okay, if it's this type of category, we'll try and send someone right away. But there's all types of calls that they just list as a low-priority event. And at best, they'll send somebody after 45 minutes or oftentimes not at all. So for example, in San Francisco, if you are a store owner and you have an unruly customer who's on drugs and refuses to leave, they classify that as a low-priority event. And even if it's going to really damage the store's livelihood, scare the other customers, potentially turn into a bad situation, the police have to ... they choose to prioritize their time. And when they choose not to prioritize in favor of that, well, what are you going to do? The private parties in San Francisco, some people just deal with it. Other times, they rely on different forms of private security. So you've got private stationary security guards in San Francisco. You also have a group called the San Francisco Patrol Special Police who are allowed to police multiple properties and you call them up and they'll send somebody rushing in right away. So the idea that government is going to be there even with a major event, it's just not the case. Do you think we can infer from those situations that it's a failure of government on some level? I mean, if you see a lot of people buying private security, maybe it's a failure of government. But alternatively, we wouldn't say that because people are locking their doors, it's a failure of government. It seems like there would be an equilibrium point that you would hit between what you could reasonably expect the government to do and then what other people have to do to take security for themselves. And sometimes we could say it's a failure, but if you're locking your doors, it's very low cost to you. So it's not really a failure of government. And something in between that, you have a symbiosis there. Yeah, I wouldn't call it a failure of government, but just a recognition. I like to use the analogy that government is not a deus ex machina. So in the ancient Greek plays, a lot of people would get into trouble and then nobody figured out knew what was going to happen at the end. And the very last couple pages of some of these plays, there would be a god who would be wheeled in on a machine and then say, okay, I'm here to save the problems. Don't worry about anything. And in the real world, we don't have a government, anything like that. So personally, I would not call it a failure of government. I would just say it's just a fact of government. Government doesn't have the ability to solve all of the world's problems. But most people assume, oftentimes, many people assume that it does. And I think we need to start questioning that whole mindset. The get to some of the examples here, because that's most of what the book is. Yeah, so I'd like to differentiate between the enforcement of contracts and the enforcement of property rights. Most people will talk about how they need to do those two functions, police and courts. And there's tons of examples where government doesn't have the ability to enforce contracts or the interest of enforcing contracts. In many cases, they view certain market activities as suspect, and they say, we're not going to enforce that. And the biggest example of this in history that I highlight is stock markets. So stock markets have existed roughly for a little over 400 years. And in most of the early stock markets, the government courts didn't understand advanced financial contracts. They thought they were forms of gambling. They thought there were types of speculation where people were using them to manipulate prices. And they said, this is wrong, and we're going to pass an edict against it. They did that in 17th century Amsterdam. They did that in 18th century London. They did that in 19th century New York. So there are whole classes of advanced financial contracts where the government did not enforce them. And the private parties, in theory, could have said, well, I'm going to go to government courts. But in reality, the government courts said, no, we don't endorse this type of contract. It's illegal. And so these contracts, even though they were unenforceable, people engaged in them anyway. And it wasn't because of government. They found private ways to make these things work. So taking matters into their own hands, they relied on all types of private rules, informal ones, sometimes private formal rules, to make very sophisticated contracts, including short sales, forward contracts, options contracts. And we're talking about in the 1600s when none of them were enforceable in courts of law. So something like a stock exchange or a market in these sorts of financial products is very large and very complex. And it doesn't seem like the kind of thing that could even from coming in privately could just form overnight. The mechanisms for creating these contracts and enforcing these contracts and exchanging these sorts of financial properties, how does something like that evolve from nothing to a full blown market in stocks without, say, the government saying we're going to create a set of regulations and some legislation that gets this thing off the ground? Yeah, so your analogy got me thinking about the creationists who would say the world was created in one day or seven days. And then all of a sudden now everything moves forward. So in stock markets, there wasn't day one or day zero where government didn't enforce contracts. And then the next day they did. And then now we have markets. Instead, government wasn't really involved with enforcing contracts. And so private parties came up with various rules and various mechanisms that evolved over time very slowly. So in 17th century Amsterdam, they relied a lot on reciprocity and reputation mechanisms at first. So with that, if you cheat somebody, that party is not going to want to deal with you. So in social science, they talk about the world being fraught with prisoners' dilemmas, which is this idea that two prisoners would like to cooperate but they're both going to rat on each other and they're both going to be worse off. Well, if you do that in business, you gain once, but you sully that relationship with the other party forever. In addition to that simple mechanism of repeat dealings, they also relied on reputation mechanisms. So if you have the ability to find out if somebody else cheated, everybody who knows is going to now be very wary about dealing with that cheat. And so they would basically boycott those parties who were unreliable. Moving forward in England, so basically 100 years after the first stock market in Amsterdam, they too relied on reputation, reciprocity, but they started creating more formal rules. So they started meeting in coffee houses and over time they decided to transform coffee houses into private clubs that could create and enforce rules. I have to ask here because so coffee houses come up here and they also come up a fair amount in intellectual history as places where great movements got off the ground. Where are these coffee houses and how do I find? Yeah, Aaron's been looking for one for a long time. Because I hang out in coffee houses quite a lot and it's usually just students studying and then millennials showing each other their startups. So back then, this is a couple hundred years ago that the coffee houses were a little bit more rowdy as far as I could tell. There's one magazine referring to a coffee house where they would serve alcohol. One of them even said sometimes they don't even serve coffee. I think it was exaggerating as a joke, but it was kind of like a meeting place, a bar. In New York, they referred to the first coffee house, which was the precursor to the New York Stock Exchange, was called the Tontine Tavern and Coffee House.  Some people in England would put out ads in the newspaper say, if you wanna buy stocks, come to this coffee house where I'm available to meet me there. So they, I think they were a little bit less sedate than the modern Seattle one. So you mentioned the reputation effects and people playing the game over and over, again, mattering for creating a trustworthy system. It seems in that system though, that the guy who comes in to try and wanna trade for the first time isn't to have a difficult time because no one knows who he is. This is sort of like trying to start an eBay account at the very beginning and having no ratings whatsoever. Wouldn't it be good if the government or a government came to sort of help guarantee that those people were safe? And it expands trading opportunities. It broadens them out and it keeps them less localized. I could believe that a small little community with reputation effects could work, but what about the outsider in that situation? Well, eBay works so well because it allows people to develop their reputation and these stock markets worked so well for the exact same reason. So to become early on, anybody could go into the coffee house and start trading. And then over time, they said, all right, we need to kind of clamp down on this potential problem of cheating. So they would start saying, all right, we're gonna let people in, but if you cheat, we're gonna put your name on a blackboard. That was basically the first rule, one of their first rules that they did. And then over time, they became- And so they did in second grade when they maybe put my name on the blackboard too. So I guess it's like a time-honored tradition. Yeah, so just sharing information about people can often be a very important mechanism of encouraging good behavior. So in these markets, you'll actually see people talking. There are all these different dialogues written. And one guy in one, it was kind of written as like an FAQ for stock markets since 17th century Amsterdam. One guy is saying, well, how do I get involved with the market and how can I interact with people when I don't have established credit? And the people say to him, okay, here's what you should do, start small and start building up a reputation and then go from there. And we have that in modern times, in modern markets. You can, anybody can open up a simple stock account, but not everyone can open up an options account. And when you open up an options account, you've got to start with a very small margin. And as you have more experience, more capital, the brokerage will start extending your margin account. So I think that the idea that we should just let all beginners come in and say, all right, here's a million dollars, do with it what you want. Or we're gonna guarantee your exchange up to a million dollars. I think that's a recipe for disaster. Instead, let people earn that responsibility. When you get to go and borrow a mortgage, you can't just, for the first time in your life, go to the bank and say, I've never dealt with a bank before, but I wanna borrow 100,000 or $500,000. They're more likely to say, well, what's your credit history? Do you have experience paying back credit cards? Do you have experience paying back car loans or other loans? And the people who've built up that reliable rating are more likely to get a loan. And I think that's a great thing. And it encourages contractual compliance without actually using government force. Now, if someone just doesn't pay in those situations, you said the contracts weren't enforceable, but if someone has lost someone a bunch of money, for example, or owe someone a bunch of money, and at some point with these stock markets, whether it was Amsterdam or London or New York City, did they have Bob the pipe-hitting guy who'd come in and break your knees and throw you down a couple of staircases and say, you gotta give us your money? No, I've seen no evidence of mafia-like tactics. Instead, what they would do, it was a much more gentlemanly club, and they would have basic proceedings where they had the equivalent of bankruptcy proceedings.  And we're gonna split this up among remaining creditors, so to kind of make it a little bit more orderly. And then they would say to the person, if you've acted willfully, malevolently, with bad intention, you're kicked out of the club forever. There's not gonna be any chance. But in many other cases, default or non-contractual compliance was unintentional. So some people, if they're a short seller, they might just not have had enough shares on hand and gotten into a lot of difficult situations, which it's kind of their fault, they messed up, but it wasn't necessarily malevolence driving their decisions. And so in those cases, they said, you can get readmitted back into the club if you try and if you basically make good on what you owed. And so you see lots of cases of that where people talking about how people are selling off their last possessions to pay off their debts in the stock market. So this story sounds good for what's ultimately, I mean, still a fairly small and crude financial market by say the standards of the global economy today or even just Wall Street today. So does there come a point when things become complicated enough or large enough or moving fast enough that this kind of informal or private government breaks down? I mean, did we see that say with the financial crisis? Well, I think the cool thing about this history is at the time these were the most sophisticated contracts by far the world had ever seen and they were developed privately, not by government. And so relative to what was going on in the world at the time, these were the most sophisticated and it was done privately. Moving forward, yes, there's many very sophisticated contracts today that are even larger, even more complicated. And here too, I would argue we can look and find a lot of the same exact mechanisms that were in place in 17th century Amsterdam in 18th century London. So let me highlight a really cool market which is futures market. In a futures market, there's lots of contracts which have the potential you could have unlimited downside risk. So people could very much screw up and mess up their other party and say, I'm sorry, I don't have your money. Well, in those cases, even the best government courts cannot recover damages that are unlimited. And so this poses a lot of problems and in stock markets today and in futures markets today, the amount of volume that takes place is just staggering. I used to work on a trading floor a few years back and we were making tons and tons of trades every single day. And the idea that you could go to the government courts and get these adjudicated if something went wrong is very questionable. And so what a, for example, modern futures exchange does is if you and I form a contract with each other and one of us is worried about the other party's reliability, unreliability, we actually don't form a contract with each other. We form independent contracts with the futures exchange. And so if one of us gets into trouble, the futures exchange is going to assume and manage third party counter default risk. And so we've got tremendously complicated contracts and the futures exchange is stepping in and making sure things don't go wrong. And I'll tell you how good they are at this. That's basically their job, that they've managed it so well that in pretty much no cases does people encounter problems. What do you think of it when someone says, basically the constant refrain that Wall Street is a lack of regulation that's a Wild West and everyone kind of does what they want and just pursues their own interests selfishly, Gordon Gekko style. What's your reaction to that, that kind of critique of Wall Street? Well, I think that people do in most or all cases often pursue their self-interest, but there's mechanisms in place that people basically design deals to make them the contracts self enforcing. So I would argue that even with the 2008 economic downturn, which was certainly problematic for many people, first of all, I'll suggest that most of the major problems were caused by government, but let's just ignore those for the moment. I would say even in this major economic downturn, tons and tons of these financial instruments were actually working as designed. So if you have a contract and you think that the other party might not be able to follow through with that contract, and you know rightfully so that the government can't get money out of a, they can't squeeze blood. What's the analogy? You can't squeeze blood out of a stone. You could say, oh, well, I won't make this contract or I'm gonna wait until the government courts figure out how to do that. Instead, they've developed all types of private mechanisms and one of them I think it's been vilified in the press, but I think we should be celebrating it, but the credit default swap is basically insurance and they say we know there's a probability that you're gonna default and because of that, we are going to buy insurance in case you default. And now you've got people analyzing this and estimating the likelihood of default for each transaction before they occur and then assigning this to different types of debt, different types of corporations and saying, hey, here's the probability that this corporation's not gonna be able to pay back and if that happens, you've got this private third party who's gonna pick up the damages and pay for them. And so even in the midst of the financial crisis when AIG was nationalized and Fannie and Freddie were nationalized, there were private credit default swap markets on those debts and it was a huge event because there was lots of credit default swaps contracts written about that debt and the ISDA came in and said, all right, we're going to figure out how to make sure that everybody who has one of these contracts is getting exactly what they owed and it was a quite orderly procedure. What is the ISDA? Oh, it's the, I forget the abbreviation right now. It's the International Security, something probably. And derivatives. It's private? Yeah, yeah, it's sorry. It's a private organization, the ISDA, where they say they wanna bring security into markets and what they'll do is they have an auction procedure where they figure out, okay, if this company's in default, we can't have all of these people who are owed money trying to buy these bonds and then sell them. So they figure out the value of the bonds and then they say everybody who is owed money on that is owed the difference of the reference debt and the current market price of the debt. So they basically oversee the procedure in case of defaults. Now, outside of the abstract world of options and futures and all these things, does private governance work on a more physical neighborhood? Personal? Yeah, neighborhood level. Yeah, so I think that the great thing about private governance is it underpins very sophisticated advanced financial markets. Oh, I'm thinking, going back, it's International Swaps and Derivatives Association, I was talking about a minute ago. It works in that case. It also works in very simple cases. So if you look at a school or a college, there are private rules and regulations. If you look at a homeowner's association, if you look at any type of sports club, a chess club, there's gonna be rules that are not quite as sophisticated as you see in a financial market, but you're still gonna see a lot of the same types of mechanisms where people opt into a system that they like. There's gonna be people evaluating rules and regulations in this system.  So in the case of the homeowner's association, a developer will say, we're gonna have very strict rules or we're gonna have very few rules and they're gonna then show those potential rules to potential customers and then market the homes to people in various ways. So Disney has an entire town called Celebration Florida, which has 10 to 15,000 residents and they have very strict private rules and regulation, private zoning rules, rules about the color of your fence, even the colors of your drapes inside the windows. And a lot of people wouldn't like that, but a lot of people love it. And the result of this is property values in Disney Celebration are higher. So I would say this is just one example that you can look around the world today and there's tons of them. I'm struck as you list these examples, say of college campuses and HOAs. So it's very clear throughout this book that you're not just simply making the argument that look, private governance can work to handle certain situations that we typically think we need public governance for, but that it either often does or in every case does work better than the public governance. But HOAs tend to be rife with pettiness, overly strict rules, basically- They're all sort of public choice problems too. Yeah, people don't tend to point to like, no one's like, I love my HOA. Yeah, that's the ultimate government, right? And then as we mentioned at the beginning with people starting to bring in public, wanting to bring in public governance to address interpersonal disputes and not being nice to each other on college campuses and things, the rise of the politically correct left on college campuses. I mean, we're watching colleges institute draconian rules and what amount to kangaroo courts and all sorts of things that look, I mean, in many ways much more awful than what our public governments in the US whether your town government or your state or your federal government are up to. So are these instances of public government or private government not working? Is there some reason that they seem to be this way? Well, the first thing we wanna emphasize about the kangaroo courts in colleges, unfortunately, they've been mandated by the federal government to follow certain procedures to be compliant with Title IX regulations where the government is now mandating that they have to adopt the preponderance of evidence standard for these things. So if there's 50.1% chance that somebody could be guilty, well, you have to find them guilty and otherwise you're gonna get in a lot of trouble. So a lot of this badness that's been going on in recent years has been mandated by the state and I think it's a terrible outcome where you're taking a system which was working fairly well and now the government is using it as the handmaiden of imposing a certain set of outcomes that they would like. So really undermining what had been tied to education, the educational experience and making it a political potato. So I do agree with you that there's a lot of problems in college campuses. On the other hand, I wouldn't say that the government courts are close to being perfect in any way and so even with a horrible private trial, it's not at all clear that the government is anywhere better than that. They have lots of problems on their own. Getting back to your suggestion and pointing out of other examples of problematic private groups such as the HOA, to be sure you're gonna see lots of people doing maybe less than optimal things in various HOAs in the exact same way that you're gonna see various companies being run less than optimally. So not every company is run as well as Google or Apple or Microsoft. And the problem is going to be ever present. However, the question is which system is more likely to have problems? I would argue that even HOAs, which in many cases are highly imperfect, have a major advantage over government rules and regulations where the government rules and regulations are imposed city wide or state wide or federal wide. And so whether or not we think that Dodd-Frank rules and regulations are a good idea or whether or not we think a particular set of zoning regulations that govern California's coast or the California Coastal Commission are a good idea, we have to follow them. And in many cases, these rules are very, very draconian. So yes, it's gonna be imperfections and all types of arrangements.  Does it just come down to size though? You mentioned that size is a problem. But when I think about an HOA and the powers of an HOA, it's very hard to make it seem categorically different than a government. You can move into an HOA and be suddenly subject to its rules, what you can with a government that you didn't vote for. And therefore they can impose rules on you non-voluntarily except for your movement into the HOA. And then they can extract taxes from you. And if you refuse to pay your HOA fees, they can either kick you out using at some point force. So it seems to me that an HOA is really close to a government. So is the question just that it's smaller? So are you really just saying smaller government is better than bigger government or is there something wrong with that? No, actually, I'm gonna make a different argument than that. So first, I'm gonna defend HOAs in a minute, but I will suggest Spencer McCallum's got a great set of arguments where he critiques HOAs and says, it's a quasi-market organization and arrangement, but it's got a lot of problems and there's gonna be, there already are a lot of better private arrangements and we should be trumpeting those instead. And so his preferred method is basically the land lease model, which you see in a hotel where the hotel is the residual claimant, they are renting out the rooms and they constantly have to worry about the demand for the tenants. You can have a proprietary community, which is also renting out the land to the tenants. And so the landlord always has to think about what's the current demand for existing tenants and what's the current future demand of current and potentially new tenants.  But back to the HOA, I'm gonna defend it for a minute. Even though it's got a lot of problems, the arrangement ultimately was created by a developer or whoever put together these pieces of property into a neighborhood association and said, here's 10 units or here's 100 units. We could have them be by themselves and the potential problem of that is X, Y and Z.   And then people have to ultimately weigh which sets of problems they think are worse and what are better. And so if the developer decides to put something into an HOA, in all likelihood, they're doing it to maximize the profits, maximize the value of the land, maximize the future value of the land. And so this is a good thing. It's not, you can point to any company in the world and say, well, look at this company, there's certain imperfections in it. Yes, I'm gonna agree with you. You can point to lots of companies and say, there's this problem that arises in many different large corporations. And I'll say, yes, I agree with you. But the question is, what is the alternative? And I would argue that it's better than not having these agreements. And so to me, the major agreement and difference between an HOA and a government is the developer got 100% of people to agree to say, here's a deed. I'm gonna sell you this property with this deed that says you're gonna be governed by this HOA. Few future people are also gonna be bound by these rules. So it's basically a covenant that people have agreed to. Whenever you wanna be a contractual member of this community, or for example, a shareholder in a corporation, you've agreed to a certain set of ground rules. But it's not like the Constitution of the United States is you could make the same argument. Right, I'm gonna contrast that with the Constitution, which basically was mandated on all people, all properties, regardless of whether they agreed to it. So, so many dozen people signed the Constitution. But 99% of the people who didn't sign the Constitution became bound to it. And then 100% of everybody's descendants became bound to it. And 200 years later, there's this permanent body, which is claimed to monopoly status over the entire North America, which says, well, you agreed to it. If you don't like it, leave it. I would say this is an argument which would justify any type of government coercion by saying, well, you agreed to live in Nazi Germany and if you don't like it, leave it. Yeah, there's some difficulties of leaving it, but we're in charge and you've signed the social contract. So I think there's a fundamentally wrong way of thinking when people liken the government to a contractual club, just a large one. Now, it seems that you're not, you don't really, they're very reticent to make the nirvana fallacy because you're saying that they're, you're not saying that government, that always private governance is better or is perfect. Do you think it's always likely to be better? And why? What are the characteristics that make private governance better? Yeah, so I think that avoiding the nirvana fallacy approach is very important and Harold Demsett's first argued this in the context of people advocating government rules and regulations, oftentimes people think of a problem and then they say, uh-huh, imagine that the government can solve it and not actually looking at whether they're likely to solve it. You have to compare real world situations and likely outcomes compared to just some, your imagined nirvana. And I think that we should recognize that private parties are not Deus Ex Machina either. They, we can't engage in nirvana thinking. And I think unfortunately some people who don't wanna do the difficult analysis just are content to say, well, let's imagine that this is not a problem. So somebody might say, well, how would a, these futures contracts be enforced? And someone say, well, ideally in my ideal world, all contracts would be enforced. Well, I don't think that's as good of an answer as somebody who comes along and says, well, here's how they privately were enforced. Here's how they privately are enforced. And so this worry that you have is not as big of a worry. Now that said, there's gonna be certain issues private parties might not be able to solve or they might yet to have solved. So we shouldn't just assume problems away but I would say the major difference between private governance and coercive government is private governance, whenever there's a problem, that is a potential profit opportunity. And the bigger this potential need, the more people can potentially gain if somebody can figure out a way of solving it. So yes, there's problems, but think, let's think about ways that we can solve them. Government in contrast is not motivated by profits and losses. They're not motivated by there's no residual claimant. If somebody creates a set of bad rules, they don't lose, if government official creates a set of good rules, they don't gain, they're imposing their costs or their burden on society. So Dodd-Frank are retired and they don't have to pay really close to a cent of the billions of dollars of compliance costs that they're imposing on society through their regulations. So I'd say that's the major difference that the voluntary nature and the profit and loss nature of market and private transactions are going to lead to systematically better outcomes than with coercive government monopoly. Okay, so someone listening to this might be thinking, great, so I can see how we might have stock markets and some contractual disputes dealt with by private corporations or organizations or clubs. And I can see how an HOA might be better than a local government. But one area that lots of people think absolutely has to be handled by coercive public government and in particular where profit motives and competing firms would be particularly a terrible solution would be private, would be policing in courts. That level, that kind of basic rights protection and enforcement is something that we need a public government that applies to everyone and is paid for by everyone to handle. Yet you have a pretty interesting chapter in the book saying maybe not. Yeah, so I'll do one caveat to your statement a minute ago, but courts as well, there's private arbitration, private mediation, most things don't go to trial. So for contract enforcement, I think it's very clear there's lots of evidence. So all I want people to do is everybody to agree that we don't need government to enforce contracts. Now, let's get to the second one here with police. Even police, which in many ways is a different situation there's tons of examples of private security and all the way up to the most formal private policing. So in certain areas in history, there's been examples of basically fully deputized private police in some cases operating alongside of government police. In certain cases operating above government police. And so the chapter- What do you mean by above? Well, the chapter describes some interesting historical episodes where in San Francisco, after the gold rush, it was the Wild West. And at first people solve things in a pretty gentle way and things are going fine, even though there was pretty much no, there was no jail, there was no police station, there were hardly any government or private police and that was working well for a while, but eventually so many people started moving into San Francisco, including different people with criminal tendencies who were threatening others, getting angry at others when they couldn't find as much gold as they wanted. And so from its very early days, you had a system of private policing evolving in San Francisco. And so you can see merchants hiring private police to protect their stores. We can see groups of citizens getting together to act against rampant private gangs and private crime. And then the interesting thing coming in 1856, the people were upset, the merchants were upset with government crime against private citizens. So in one case, a politician killed a businessman, a newspaper editor who had published negative things about the politician. And the people were like, well, we see what you do.  They viewed the police and the political cronies as worse than the criminals themselves. And so in this case, they actually formed a system of private justice where they were creating laws against government officials. So my favorite thing they did was they actually enacted gun control against government police. Wow, fascinating. So a libertarian, a person who's not very friendly libertarians listening to this would truly think. So you've outlined this private policing thing and sure all grant that private security can be the entirety of security and therefore rich people will have security and poor people will not. How do you respond to that criticism? Yeah, I think the biggest victims of government policing in the world today are inner city residents. Oftentimes people who are in different minority communities who are looked on poorly by government law enforcement. So I think this recent Black Lives Matter movement is very important and people who are interested in libertarianism should be interested in this movement because police historically for many years have not cared really about protecting the property rights of inner city residents. They don't really care about making law and order in a sense of reducing crime. Instead, they're oftentimes viewing them as sources of revenue. So in many cities, they'll have ticket quotas. In other cities, they'll have arrest quotas where the government police are basically acting like people in the Soviet Union with gross output planning models where they're not looking at the customer, whether the customer is happy or satisfied. They're like, oh, well, if we arrest a bunch of people, we can be better off and we can get raises and tell people that we're doing things. And in many cases, the police spend their time looking for asset forfeiture and a lot of these people are unfortunately victims of the police and are starting to act up, I think, in a great way.  And then they strangled them, which was really terrible outcome, but I think the people kind of getting upset about this, I think they're completely justified. Unfortunately, I think certain people are acting out in ways which I would argue are counterproductive oftentimes. But the idea that government police are on the side of poor people is just completely false assumption. If you look at the amount of trust rates of police among different racial groups, it's very low, for example, among African-Americans because they're the ones who are mistreated the most by police. This seems like an example of what you were saying that right now, under the political system of policing, there's no one who can capture the gains from doing a better job of policing the poor neighborhoods. And there's no one with the incentive to do it, so maybe what they really need is a little bit more profit motive and a little bit less political because right now the only thing they can do is try to act politically, try to get people to vote for or respect the Black Lives Matter movement, try to get people on their side politically as opposed to holding out some dollars and saying, hey, come do a better job than the government's doing. Yeah, so there have been cases where there was different examples of community policing and certain projects. One group was associated with a nation of Islam where there were volunteers, police privately patrolling the security projects and the government comes down and says, nope, we are the people who are going to enforce the property rights and the rules of this area and you're not allowed to do that. So I think just moving to a system of volunteer neighborhood watch and then adding in some of these profit incentives that you're talking about, either one of those could be huge steps in the right direction. So if public or if private governance, works so well, is so much more efficient, seems to be able to handle everything we might throw at it, why are people so skeptical of it? Well, government has for a long time told people that law and order comes from government. They've told people that they exist to create law and order. And so if everybody or the vast majority of people believe that and then they say, well, if we weren't here, we would have chaos that is a basic assumption that has been ingrained into so many people. And even many free market economists have adopted that assumption. And what I'd like to point out, it's not based on empirical evidence, but it's basically an assumption based on, in many cases, government propaganda. Are there any areas where either public governance is necessary or seems to clearly work better than private? My own position is government is not created to benefit the citizenry. I don't believe that government was ever voluntarily agreed to, to work on behalf of the citizenry. I believe that government was created, and we can look at this in history, to raise revenue for government officials. So you can see this in England a thousand years ago. They had largely private form of law enforcement. It was restitution based, which meant that if there was a problem, the perpetrator had to pay back the victim. And so it was trying to make people whole again, kind of like a tort system. But the government officials saw that system after the Norman invasion especially, they said, oh, well, you know what? In addition to paying back the victims, why don't you pay back some of that money to me, the king, for violating my peace? And so we saw this system evolve from one that was private and largely voluntary to one that government was using to raise money for the state. And I think that story pretty much sums up governments throughout. They might tell people that they're around to solve various problems for the citizens, but in reality, we can see them doing it time and time again to extract resources from the public. The question that I, again, I popped my head just now is how would you respond to the person? So you just sort of made a very big indictment against government and then someone says, okay, well, if that's what you think, then go live in Somalia and I'll stay here in America when there's more government. Yeah, there's a great funny video critiquing libertarians on the internet for saying that.  It's such a great paradise. But I think that the comparison is basically assumes that government is making everything good in North America and the lack of government in Somalia is making everything bad in Somalia. But some of my friends, Peter Leeson and Benjamin Powell have done studies of Somalia and pointed out that Somalia has tons of problems, but so do their neighboring countries and government used to exist in Somalia and they had tons of problems in Somalia. Government still exists in its neighboring countries and they have tons of problems in its neighboring countries. So we can't say that government itself or lack of government itself in Somalia is the problem or the solution without doing comparative analysis and what they've both found is that Somalia has gotten more investment in lots of areas since they haven't had a government and they've gotten more investment in lots of areas compared to their neighboring countries with governments. So I don't wanna live in Somalia ever. Well, never say never, but I have no plans to ever live in Somalia. But that's because there's a lot of issues there that we don't luckily have to deal with here. In terms of whether or not somebody in the United States who's unhappy with the current setup should have to leave, I think this is one of these love it or leave it types of arguments, which really could apply so broadly that would attempt to shut up all criticism. And so people could say that in the Soviet Union, oh, if you don't like the government here, love it or leave it, why don't you just leave? And I would argue to that, why does somebody who is a resident of Russia and now they're subject to the Soviet state, why do they have to leave, pick up all their property? Actually, they can't even pick up their property and uproot their families just because they are under the control and unhappy with these despots. I think that the question is not whether the residents should have to leave. Why are the politicians asserting that authority to begin with? And I'll make that same argument about the United States. My family came to New Amsterdam a long time ago and they weren't asked by the British when the British took over New Amsterdam and said, all right, you're under our control. If anybody says love it or leave it, I would say, well, the British should need to leave New Amsterdam. And so I don't see why that argument should be binding on my ancestors in the 1660s. And I'll make that argument today. There's tons and tons of bad things the government has done over the past couple of hundred years and love it or leave it, my own position is, well, they should leave it. I was here first. So would it be fair though to call your book an argument for political anarchism? Yeah, if you wanna call it that, I would have no objection to that. I tend not to use that word in certain settings because it has multiple meanings, some of them positive connotations, most of them very negative connotations. And because the dictionary has two very different meanings of that word, I think there's better words that exist, but yeah, I'm okay with that. Perhaps people, one of the real benefits of your book is that people can kind of see that so-called anarchism or statelessness is not always disorder, quite often a good type of order and also all around us in a way. And maybe that's a good way of getting outside of the state is just noticing what's always been there and is still around us today. So in that theme, do you see private governance growing in the future and what sort of possibilities do you think we can govern ourselves privately into the future? Yeah, so the reason I like to use a term private governance is because it's a positive word. If we focus on, you know, in terms of anarchy, it's a negative word without an overarching state and then people start thinking about, well, what's gonna exist without this? Well, here I wanna focus on the positive things that already exist throughout history and in modern times. They exist when we don't have states, you have private governance. They also exist when we do have states, we have private governance. They exist for simple markets where people are dealing with, you know, small trading in a third world country. They exist for very large, complicated, sophisticated markets, securities markets, futures markets. And so they exist in all cases. And I'm suggesting that it's all around us. It's done a tremendously effective job at creating order in the past. It's doing a tremendously effective job at creating order today. And the more people can notice that and appreciate that, they're gonna have to rethink this idea that all order in the world is owed because of the state. Instead, I'm going to suggest that it comes about privately, voluntarily, and it comes about through markets. Free Thoughts is produced by Evan Banks and Mark McDaniel. To learn more about libertarianism and the ideas that influence it, visit us on the web at www.libertarianism.org.


It is now time for Member Statements and I recognize a member from Ottawa Centre. Thank you Speaker. Lately we're used to hearing stories about economic hardship, businesses without customers and workers without jobs, but what I'm not used to hearing about Speaker in Ottawa are examples of employers who are using this moment to throw workers under the bus. But unfortunately that is what's happening at the Ottawa Sheraton Hotel. This week Speaker without a letter, without a phone call or without an email management told workers in this hotel that they were terminated. Terminated 70 family supporting jobs, speaker jobs that sent kids to school allowed people to retirement and dignity gone. The union was trying to extend recall rights in this workplace so workers could come back once the pandemic was over and tourism was up and running again. But the offshore company that manages this hotel speaker has decided to treat workers in this place as if they're disposable. Well I have a message for Ketsing Investments. If you think you can throw workers at the Ottawa Sheraton Hotel under the bus and face no consequences, you are wrong. Effective immediately, I am supporting the boycott called for at the Ottawa Sheraton Hotel by the union in this workplace, Unite Here Local 260, and I am going to be contacting my friends in government, the union movement and other community organizations to stay away from your hotel until those recall issues are put back into place. Those workers made your hotel successful. You owe them the respect to make sure they can continue making the Ottawa Sheraton Hotel a success. Do the right thing Ketsing Investments. Do the right thing by your workers who make this hotel great. Thank you very much. The next statement, the member for Mississauga Lakeshore. Thank you Speaker. Over the last month I was honored to host a virtual pre-budget consultation in Mississauga Lakeshore. We heard an incredible range of ideas and priorities from community leaders who are dealing with the ongoing challenges of COVID-19 in healthcare, in long-term care. We were joined by Bayshore Healthcare and Alba Medical. We welcomed many small businesses from fired up to Stone Hooker Brewery, Hub Climbing and I Create Art Studio. Told us about the devastating economic impact of COVID-19 but also shared constructive ideas to help ensure a safe reopening and a strong recovery. Representatives from Hart House Hospice, Dorothy Lay Hospice and the Canadian Grief Alliance spoke about the unique challenges they're dealing with. The Mississauga Senior Council presented their ideas to make life easier and my Youth Advisory Council including students from UTM, Ryerson and Guelph spoke about their adapting with e-learning. I would like to thank the Minister of Finance for joining us to listen to the people in Mississauga. Speaker, as the member from Perth Wellington said, the best ideas don't come from Queen's Park, they come from the people we represent and that was certainly true again this year. So again, I'd like to thank everyone who attended or even just made a submission online. I know that your feedback has been invaluable to helping to shape the 2021 Ontario budget which will be heard more about later on today. Thank you. Thank you very much. The next statement, the member for Algoma Manitoulin. Thank you, Speaker. I want to thank the members who have reached out from Algoma Manitoulin to me to raise their concerns in regards to the government's rollout of the vaccine. Many communities in Northern Ontario, particularly in Algoma Manitoulin, the information they're receiving from this provincial government does not match what is happening on the ground in northern communities. Vaccines are late coming to Northern Ontario and very slow coming out in dribs and drabs. Here's an inquiry that I got from a resident from Manitoulin Island. Her name is Pam. I'm writing to you as I am very concerned about the length of time it's taking to vaccinate our population. Our island has a large seniors population and with that, and with the long weekend of May coming, we are very concerned. That is, we need far more vaccines here to get our aging population vaccinated. There's another message that I receive from John. John's from Elliott Lake. As you know, Speaker, Elliott Lake is comprised of many seniors. It's built on seniors' population. At this rate, he says, he thinks that at this rate has been received vaccines were weeks away from completing the vaccination to our residents. 80 plus while southern Ontario people are starting to get the 75 plus. This is the confusion that people are seeing across Algoma Manitoulin is we're not getting the vaccines in Northern Ontario. We're not asking for more, but we're certainly asking for an equitable distribution of the vaccines so that Northerners can get their fair share of vaccines. Thank you very much. The next member statement, member for Etobicoke Lakeshore. Thank you, Mr. Speaker. And Speaker, I rise this morning bearing sad news from the mimical community in my riding of Etobicoke Lakeshore. Natalia Bolto of San Remo Bakery, a family-owned staple in our community for over 50 years, recently passed away from COVID-19 at the age of 75. Natalia was a loving husband, dedicated father, supportive no-no, and a true local champion. Natalia immigrated to Canada from Italy at the age of 15 where he began working at the bakery in Little Italy. He later opened San Remo Bakery in 1969 alongside his brothers. Natalia became a sole owner of San Remo in the 90s and his sons Rob, Nick and Eddie, have carried on the legacy. Although he retired, he could always be seen around the bakery as it was his passion. He was an incredible baker, and he said the secret to baking was putting a pinch of love into everything, which comes to no surprise as you can taste the love and dedication in every pastry or a doughnut. Natalia was hardworking, resilient, and resourceful. He created lifelong relationships with those who frequented the bakery. He is loved by all, but most importantly, he is loved by his family more than anything. This is a devastating loss for both the family, the mimical community who could feel the passion and the loss when they all lined the streets around the bakery to say goodbye to the friend of our community and a presence that was larger than life. Thank you very much. Member Statements, the member for Brampton East. Thank you, Speaker. It's always a pleasure to rise in this house. Brampton is a city of over 600,000 people, yet we only have one hospital that is chronically overcrowded and underfunded. People in Brampton are genuinely afraid to attend the single hospital in our city. They're afraid of facing long wait times. They're afraid of being treated in the hallway. They're afraid of not getting the healthcare support that they needed at their desperate time. It's so bad at Brampton that a healthcare crisis was declared before COVID-19. Now, at a time of crisis, you don't drag your feet. You act decisively to fix the issue, and that's why the NDP is calling on the conservative government to build another hospital in Brampton. But now is not the time for half-measures. Brampton, at this point, needs a permanent solution to address our healthcare crisis, and that's why the NDP is demanding that Brampton Civic gets properly funded, that Peel Memorial gets converted from a health centre into a full hospital, and also that we build a third hospital in Brampton. Brampton does not deserve anything less than that because Bramptonians deserve to live in a city where they're not afraid to access healthcare. They deserve to live in a city where they're not afraid of being treated in a hallway. Brampton has been left behind for far too long. Enough is enough. The conservative government must act now. They must act now to fix Brampton's healthcare crisis and ensure that people in Brampton can access healthcare in a dignified and respectful manner. Thank you, Speaker. Thank you. Member Statements, the Member for Milton. Thank you very much. Thank you, Mr. Speaker. Mr. Speaker, I'm proud to announce that our community of Milton will be receiving 416 new long-term care beds as part of our government's historic investment of $933 million. Speaker, this is a tremendous announcement for our community of Milton. This is in addition to the 192 beds that have already been previously announced for Milton. Now, 224 new spaces for Milpont Manor and 192 new spaces for exelegant care. They will also offer services to the Muslim community in Milton. Mr. Speaker, we on this side of the House are delivering results each and every single day. That's 608 new long-term care beds for Milton, alone, Mr. Speaker. Now, let's compare that to the embarrassing record of the previous Liberal government who only built 611 new spaces in the entire province, Mr. Speaker, between the years of 2011 and 2018. I'm proud to be part of a government that prioritizes our seniors and takes action to support them. Thank you, Mr. Speaker. The next Member Statement, the Member for York Centre. Last Tuesday, the Premier said that there is no politician who would disagree with the Medical Officer of Health because doing so would amount to tying a rope around your neck and going off a bridge. You see, the reason we're in lockdown is not science, but political science. And there's no one that's been harmed more by Doug Ford's politics than Ontario's children. Children are traumatized after being home for months against the advice of most doctors. I'm going to interrupt the Member and remind him that he's got to refer to other members by either their ministerial title or by their writing name. Can resume. But there's no one that's been harmed more by the Premier's politics than Ontario's children. Children are traumatized after being home for months against the advice of most doctors out of public health. They're almost at no risk and they rarely transmit COVID. But this government continues to inflict harm on our kids at school when they're forced behind plexiglass, gagging into silence during lunch, confined to a box drawn on asphalt and forced to wear masks outdoors. Where is the science? What science is leading to this cruelty? But after school, the trauma continues. Sports, athletics and dance are cancelled. Parents tell me how their depressed kids are bursting with energy but taken out at the kitchen table. In addition to eating disorders, they develop anxiety. Shutting down kids' sports is terrible for kids' health and mental health. According to Dr. Watson of Wisconsin, there's truly no documented incidence of transmission between athletes. But why not let kids practice slap shots or skating skills or work on their dribble and free throws or dance in their own space? Why are you making up stuff in an attempt to distract from your failure to protect wonderful seniors? Ask the Member to withdraw his unparliamentary comment. Withdrawing.  Stop doing it. Let kids be kids again. Let them live again. Bring back sports and bring it back now. Please. Thank you. The next Member's statement. The Member for Markham. Thank you. I rise today with a heavy heart to make this statement. After the British left in Sri Lanka in 1948, the Sri Lankan-Chinkali Sovanistic Government started their anti-democratic operation with a series of pogroms, ethnic cleansing, colonization of Tamil traditional homeland and genocide against the Tamil. This lead to the death of hundreds of thousands of Tamil and brutal massacres of innocent women and children. In response, the Ilam Tamil have resisted passively for years. In 2009, in the final stage of the war, Sri Lankan armed forces suppressed the Tamil resistance, massacring more than 147,000 people. Sadly, the Office of the UN Commissioner for Human Rights Council denied the justice for the Ilam Tamil people by refusing to recognize the Tamil genocide. On March 14th, work for the justice group, rectified kilometer for burial in cold weather during this terrible pandemic, which took place in Queen's Park on March 18th last week. They plead to the Canadian Prime Minister, Secretary-General and the Khai Commission of UN, UNHRC member countries to intervene and protect the Tamil from the on-going genocidal activities in Sri Lanka. UN report warned that the failure of Sri Lanka to address fast violation has significantly heightened the risk of human rights violation being repeated. Mr. Speaker, over 300,000 Tamil Canadians proudly call Ontario as their home. Each have a story to tell about their loved ones. They have a faith in us to take their voices to the federal government. I completely request this House as the federal government to refer Sri Lanka to the International Criminal Code which can appoint a country-specific rapporteur for Sri Lanka to monitor and report to the international community. Thank you, Mr. Speaker. Next member, Davenport. Good morning, Mr. Speaker. It's always a pleasure to stand here in the House of my community, the great writing of Davenport. Mr. Speaker, unfortunately, about a week ago I had to write a letter to the Minister of Health about an issue that's very deeply concerned to my community. Years ago, members of the Portuguese-speaking community in the GTA came together with mental health providers to address the lack of mental health and addiction services in their language available throughout the GTA.  It's operated out of the University Health Network Western Hospital for many years now. It serves about 1,000 patients a year. Unfortunately, a couple of weeks ago I learned that they're not taking referrals anymore and, in fact, we believe this program is being shut down. Mr. Speaker, I wrote to the Minister of Health a week ago. I have yet to receive a response at all. No calls, no emails, no letters. People in the community are deeply concerned about this and I will add, Mr. Speaker, we have learned that the Spanish-speaking program and the Chinese language program are also at risk. When will this Minister of Health step up and please protect this community? These are many of our frontline providers. People are experiencing trauma, addiction, mental health issues. We need to make sure they receive these services in their language. Thank you, Mr. Speaker. Thank you very much. Member Statements, the member for Don Valley North. Thank you, Mr. Speaker. I'm deeply troubled by the recent of brutal assaults and senseless murders targeting Asian businesses and communities since the pandemic. Some people think horrific acts of racism happens only in the United States. The fact is, according to the Vancouver Police Department, the city has seen a 717% increase in anti-Asian hate crimes from 2019 to 2020. Speaker, people feel frustrated during the pandemic but it's not the fault of the Chinese or Asian people that the first case happened to be in China. On behalf of my constituents in Don Valley North, I call upon all Canadians to speak out and act against any form of racism. Those few who maliciously stir up hatred against the Asian community on social media must be held accountable for the rhetoric that fuels the frames of viral anti-Asian racism that creates division within our society. Along with disturbing incidents of racism, I also witness the spirit of encouragement and support for Asians experiencing racism and violence. Speaker, I'm confident that the Canadian spirit will sign through these dark times to inspire us to counter the hatred with Canadians and to commit the peaceful unity for all Canadians. Thank you, Mr. Speaker.


How's it going forex traders, it's your truly Dapo Willis now guys, today I want to talk about the forex pairs that made me a lot of money in the forex market, yes I want to reveal the secret to you guys today, what are these pairs that I like to trade that make me a lot of money. Now I know a lot of you guys are coming into this game and you're a bit confused, what pair should I focus on, should I trade, GBP USD, should I trade the majors, the minors, gold, S&P. The last time I checked there were over 40 different, 40 different instruments to trade from and if you're not careful you will get extremely confused like it's too many things to do. So like I said guys, I want to share with you guys the forex pairs that I have actually made me a lot of money and hopefully you guys can watch this and learn and I'm not exactly trying to say you guys have to trade what I trade, actually I suggest you trade what I trade because it's the easiest thing to trade but the essence of this is to basically guide you guys so that you know exactly what to be trading, the easiest pairs to trade and the pairs that are most likely going to make you a lot of money like they have done for myself.  Alright guys, before I do anything, before I start this video, smash the subscribe button right down there. We're growing the community. My name is Dapo Willis for those of you who do not know and I'm here to finally save the forex trading industry because a lot of people seem to be losing money, only 5% of forex traders are actually successful in this market, which is actually sad because the many 95% never actually get to make a withdrawal. So the essence of this channel is to save the day, so we're here to save the industry and I'm here to put out as much free information as I can. So very first thing, smash that subscribe button right there. There you go. Alright guys, so let's kick things off. Now I want to break this down into, actually I've written them down somewhere about here because I don't want to forget, I'm going to speak from my head but I'm just taking down some bullet points. So if you see me looking down here, it's because I don't want to forget anything. So guys, let's break things down into, let's start with my favorites, like these guys. Anytime I look at these guys and every time I click it by or sell, I always make money. So let's start with the very, very best ones. So the very best forex pairs and I feel these are the easiest pairs to trade and I'm going to explain to you guys why I feel like they're the easiest and the best pairs to trade in a bit. Now my favorites happen to be the Euro, GBPUSD and AUDUSD. You see these three pairs, you can almost never get it wrong. Now why is that the case? So the very first thing is what they call liquidity. Liquidity is basically the amount of money flowing through the market. Now you have to understand that EuroUSD, GBPUSD and AUDUSD are all US dollar based pairs. Now for the fact that they have US dollars attached to them, simply means that obviously for those of you who are new to the market, you guys probably know this or you probably don't know this, the US dollar is the global currency. Now any forex pair that has a USD attached to it tends to have a lot of liquidity because the entire world is trading via US dollars. Now you take a currency like the Euro, you pair the Euro, which is the second highest currency in the world, you pair both of them together. You have so much money going through this instrument as a whole. So it's the EuroUSD. The second is GBPUSD and the third is AUDUSD. So you see these three ones, they have a lot of liquidity. Now how does this make me money? How does Dapo Willis make guys? You see the Euro? Oh my goodness. In 2014 I made, that was my best trading year ever. The market was trending, I made so, how much did I make that year? Maybe, I think I was probably 22 at the time, 2015, this is 20, we're in 2022 at the moment, seven years ago, so it's a surprise. I was 21 guys, I made 250K pounds that year trading the Euro. The setup was so simple, I'll get into that shortly. So because of the fact that we have a lot of liquidity in these three pairs, liquidity simply means like I said, money flowing through these pairs. Now for the fact that there's a lot of liquidity, it simply means that a lot of people are looking, a lot of traders are looking at these pairs. Yes, everybody is looking at the Euro, everybody is looking at GBPUSD, everybody is looking at AUDUSD. Once again, how the hell does that help us? I'll tell you. Now for the fact that everybody is looking at these three pairs, now you have to understand that the market moves based on mass human psychology. Yes, there's something called mass human psychology, meaning that if one million people are looking at a particular instrument, for example, and there's a particular resistance level, one million people are seeing it, one million people know it's a resistance level. So one million people are going to sell at that resistance level, and if one million people are selling at a particular level, best believe the market is going to drop. To summarize why I like these pairs, everybody is looking at them, and for the fact that everybody is looking at them, it makes it easier for you to read the patterns. The market always puts in patterns, the patterns are easier to read, and for the fact that the patterns are easier to read, it makes people like me, I mean, I'm just there seeing like, oh my God, this is a support, this is a resistance level, let's go, let's bang, click, click, click, click, it's a lot easier for you guys to interpret. And another reason why I like these pairs is for the fact that it is a lot more difficult for market makers to manipulate the market, because you have to understand that there's a lot of liquidity, there's a lot of money in these pairs. So the market makers will need more money to manipulate those key levels, meaning that if you're trading these top three pairs, you're prone to less stop loss runs.  That is known as market manipulation. You see, with the majors, they actually call the majors, let's use the right technology. With the majors, it is a lot more difficult for market manipulators to manipulate the majors. Why? Because there's too much money there, they don't have enough money to manipulate, unlike those other pairs that I'm going to speak about later on, where there's not that many people trading them, but with these big boys, it's a lot more difficult. So you are in safer hands to trade these pairs. Now guys, another reason why I love these three pairs is because it is a lot easier for me to analyze. Now you guys know me, I like to trade the top-down analysis, which I feel is the best way to trade the Forex market. You see, because of the fact that the market respects major zones, the market moves from zone to zone, like it respects the key levels, it makes it easier for me to trade. Guys, let me explain something to you guys.  Everybody cares about how much money we're making. So our duty is to get in there and actually make money. So I would look out for the easiest pairs to trade. I would look out for the easiest setups to trade.  I want to trade the most obvious setups. And trust me guys, the Euro, GBP USD and AUD USD will give you the most obvious setups to trade. Now guys, so that being said, what strategy can you guys then use to trade these three pairs that are the easiest pairs to trade? Now guys, for those of you guys who've been following me the longest, I put together one of the most realistic approaches to the Forex market ever. It's known as the top-down analysis. This is basically when I go on higher timeframes and I anticipate thousands of pips into the future and then I scale down to lower timeframes and I trade in the direction in which the higher time frame has told me to trade. Now this is very effective and efficient because the higher time frame always paints the picture if the higher time frame is saying I'm going to go south, chances are that the lower time frame will always follow suit in that direction. So there's something called the top-down analysis which I teach on the Forex Mastery Program. And for the fact that the Euro, GBP USD and AUD USD have a lot of liquidity, you're able to interpret this pattern a lot better obviously with the knowledge from the top-down analysis and the Forex Mastery Program. Now for those of you guys who haven't grabbed the program and you're interested in equipping your mind to trade the easiest pairs possible and make a lot of guys want to say it is so once you learn top-down analysis, once you take the Forex Mastery Program, you will absolutely love the majors because for every move it makes, what you learn on the Forex Mastery Program is actually very applicable. So you're literally just going to be seeing every move and you're like, ah, even when the market is most likely going to be a losing trade, I speak about how to anticipate losing trades on the Forex Mastery Program on top-down analysis, you're like, ah, I know you, I'm not going to trade you, oh, I know you, this is going to be a home run. So, like I said, the top-down analysis actually helps you project over 1,000, 2,000, 1,000, 2,000. What am I saying? GBPUSD just fell 1,000 pips. Yes, like two weeks, two, three weeks before I recorded this video, we did an analysis with the top-down analysis and we projected over a 1,000 pip drop on GBPUSD, even the EuroUSD as well and gold as well. So guys, trust me with the top-down analysis. If you combine the top-down analysis with what you learn on the Forex Mastery Program. And these major pairs, you put them together, you will make so much money, you won't even know what to do with it. Once again, the link is always around here as well, just click here, click the link down below, grab the Forex Mastery Program and you're good to go. So guys, let's go into the second aspect of the pairs that I like to trade. So what's the next one? Okay, so it's one about the Euro, AUD, USD, GBPUSD. Let's go over to the other pairs that I like to trade, but I don't really trade that much. Let's go. The secondary phase of the Forex pairs and instruments that I like to trade, but I don't really trade that much, is commodities, right? So I have the majors, which are my best. Once I touch them, once I touch them, add my knowledge from the top-down analysis and Forex Mastery Program, put them together, oof, I'm writing 9 out of 10 times. I forgot to tell you guys how efficient that whole situation is. But aside from that, what is the next thing that I really like to trade? Gold. Yes, without any further ado, let's give a round of applause for gold. Now guys, gold, oof, 2018, I remember doing the top-down analysis for gold in 2018. Guys, I banked 5K, took 7,000 pips over this panel of what, seven months, eight months? Yes, so if you prorate that, I was making the thousand pips a month. And obviously with the knowledge from the top-down analysis, I just simply went on a higher time frame. I saw the head and shoulder pattern, module 5 teaches you this on the Forex Mastery Program. I literally just saw it, waited for the neckline break and bam, that's exactly how I projected 5K pips into the future, put my first position in, and then as market went in my direction, added the second position and accumulated, put them together, 7K pips. Now why do I like gold? I just told you, it's easy to interpret as well. Let me give you guys a little secret when it comes to gold, right?  These things I just told you about, to summarize everything, don't tell anybody guys, it's a little secret, they like to trend and when they trend and they pull back, the pullbacks always work. I'll give you an example. Let's say the market falls like this, whoo, and it pulls back, whoo, see that's fun when it's pulled back, all you need to do is wait for it to start falling again. So, whoo, it's gonna drop 9 out of 10 times. If you wanna understand what I'm talking about more, top down analysis to teach you, grab the program down below, but that's by the way, simple. Once these pairs start to trend, you are going to make a lot of money. Now another thing I need to warn you guys about is, sometimes you can get into a trade with these pairs and the market might take a little bit longer for it to hit your target. It's exactly where you have to be patient, you have to be like, okay, you have to believe in your strategy, you have to believe in yourself. But guys, you see these pairs, they have never let me down, gold. And one thing I really like about gold is, when gold is ready to move, gold can drop 500 pips in a day, easy, as long as you're on the correct side of gold, okay, and what I like to do with gold is I like to catch what they call falling knives. Like I said, the market needs to give us some form of a commitment. Market come now, whoop, pull back. Now these pushes need to be on like a daily timeframe, I can't really go into detail here because I don't really have time for that. I said, this video is gonna be 15 minutes already, 40 minutes, jeez, Christ. Let's carry on. Anyway, so gold is, like I said, if you can get it right, you get your analysis right, you will make a lot of money from gold. Now I have to warn you guys, one thing about gold, you see, I always talk about advantages and disadvantages.  So you have to be really careful when it comes to gold and you have to calculate your pips and risk management and everything, you need to calculate it really well because the pip count on gold is huge and if you're not careful, if you don't implore proper risk management, you can actually have your entire account wiped away like this.  It's on Forex Mastery programs on the risk management module. Anyways, there's a link on the Forex Mastery, Forex Mastery, you know, I think it's under the risk management module. If you click the link and before you ever trade gold and show to calculate your risk properly before you get into any trade. But that being said, gold is a fantastic pair to trade. It is my second best group of instruments to trade and I feel you guys should be trading them as well if you want to make a lot of money. At the moment, as I'm recording this video, gold is ranging really badly. But I can bet you once the breakout happens, once the breakout happens, we're good to go. You make a lot of money from gold and guys, see, I'm just sharing all my pairs with you guys that I like to trade. When you make money, you better open the GoFundMe and give me some money because, guys, I'm giving you guys three gems here, okay? Three gems here. So guys, after this, I'm going to talk about, okay, one last one. All right, guys, what's the last one? Give me a second, guys, give me a second. I wrote it down somewhere. Oh, I almost forgot this guy, the S&P 500. As you can see, I'm making my way from Forex to commodities. Now we're into indices. Now, when it comes to S&P 500, I'm just going to be very straight with you guys. It's the index, right? They have various other indexes you can trade. There's the DAX, there's the DIST, blah, blah, blah, blah, blah. Over the years, 11 years worth of trading, I'll tell you. The S&P 500 is the easiest to trade. As with everything I've told you guys here, I'm giving you guys the easiest ones to trade because we're not here to act like we're best traders in the world, although I consider myself the best trader in the world. However, that's not the point. I am here to make money, okay? So as with everything I've given to you guys today, I'm talking about the easiest ones to trade so that we can go and leave this video and go make money on Monday morning, right? So S&P 500. Now, what is the hack behind S&P 500? It's simple because the same strategies that you use for Forex, you can use for the S&P 500 as well. Isn't that really cool? Another thing I noticed about the S&P 500 is that it is always trending upward. Yes. Forex mastery students, if you go and watch the top-down analysis module on module five or six, where I speak about obviously the top-down analysis, once you zoom out on the S&P 500 to like a monthly and a weekly timeframe, you would get you to understand what I'm saying. Now, it is for the fact that it's always trending upwards. It's so simple. All you need to do with S&P 500 is wait for the pullbacks, okay? Okay, I can't share my entry strategy with you guys. Before I smash you students, you know what to do. Wait for the pullbacks into the trend line, okay? When it comes down, use the willy zone strategy, let it bounce, done. And the good thing about the S&P 500 is once you get into the trade, you can hold this for a long period of time. Yes, because the market is always trending to the upside. Even when the market decides to retrace massively and task to four, you would always notice. I remember during the, I don't think I can use the word.  Like, you know what I mean, right? That thing that came and everybody had to stay in the house. I can't use that on YouTube because they might ban my video. But during that period, right? The S&P 500 fell. Everybody was shouting blah, blah. Guess what, guys? The S&P 500 fell. Everybody was shouting, oh, the whole world is going to a recession. Blast it, blast it, blast it. The S&P 500 fell. Guess where it fell into? Trend line and its major support level. Guess what happens, guys? When it came into that level, do you know what happened? It bounced back to the upside. I bought and then the market went and rallied. So S&P 500, even if it's coming down, it will still go back up. What do I have to do? What does this simply mean for all of us? Just wait for it to retrace into major levels as it comes down, bounce it all the way. Bounce it back to the upside. And then you have something like this. Like Michael Jordan, you know what I'm saying? This is the S&P 500 for you. And guys, what year was that? I don't really trade the S&P 500 that much anymore because I like to focus on the major pairs. I like to focus more on forex. But when it comes to the S&P 500, I feel like it's one of the most, if indeed you want to dabble with anything indices or anything of that sort, I feel like S&P 500 is, don't look, don't go to DAX, don't go to those Japanese in the other S&P 500. It's a lot easier. Guys, like I said, I'm talking about things that make it really easy for us to trade, right?  Jesus Christ. Still recording. Anyways, I'm talking about things that, you know, will make our lives easier for us. I don't want to trade anything that's gonna stress me or increase my blood pressure or anything of that sort. No, no, no, no, no, no. The ones that will present the most obvious patterns, that's the summary of this entire video. So we started from Euro, USD, GBP, USD, Euro, GBP, USD, AED, USD. If you check all my technical breakdowns, you see these are the pairs I really like to trade. Why do I? Because they present the most obvious patterns. It's easy, straightforward. If you use your, like, it's so simple, okay? Especially once you've taken the Forex Mastery Program. If you haven't taken it, I suggest you get it. The link is gonna be around here somewhere. With the Forex Mastery Program, you can trade all these instruments, okay? Now, that's one thing. Secondly, no, no, no, what was I saying? Secondly, okay, let's talk about, give me a sec, guys.  Today, I wanna have fun. Not every time we sat here bashing charts, this, that, that. Let's actually have fun because, man, trading can be stressful. I'm telling you guys, eesh, eesh, eesh. Too much stress. Now, guys, let's talk about the pairs that I don't really like to trade. Let's talk about the ones that I like to trade. The ones I don't really like to trade. See, GBP, AUD, run away. Euro, JPY, run away. USD, JPY, run away. The CHF, JPY, run for your life. Run, you see those exotic pairs, those pairs. You know why I don't like to trade them? Because we have low liquidity, a slow liquidity game. Meaning that the market is up to date, it's jumping up to date, it's coming down to date. Euro, AUD, all those guys. I'm not really interested. Some people, I see people like to trade them. Happy for you if you're making money from it. If you claim, well, I know a lot of people are not really making money in this game. But if you claim you're making money from those pairs, that's absolutely fine. I'm not gonna say anything. But after 11 years, I've traded all of them. All of them. And I can tell you, those other pairs will stress you out. Stick to the majors.  Stick to them, grow your account. You can trade these other ones, these exotic ones, but reduce your risk here and there. And I don't know, guys, if you really wanna trade that's up to you, but stick to the guys that have the most obvious set up. CHFJPY, run for your life. EuroJPY, run for your life. GBPJPY. I remember when I used to trade GBPJPY, but I was like, GBPUSD, I prefer to trade GBPUSD because, like I said, the setup is a lot more. If I can trade GBPUSD, why trade GBPJPY? So, guys, in summary of this entire video, if you're brand new to Forex and you're looking for the pairs to trade, or you've been trading for a while and you're stressed out, please stick to the majors. I don't care how long it takes for your trading setup to form, I don't care how long it takes for your trading setup to happen, stick to the majors because chances are that you will most likely make more money from trading them than you make from trading other Forex instruments. Once again, I'm not here to argue with anybody. This is not an argument, I'm telling you facts from 11 years' worth of experience. Anybody who wants to argue with this, bring your trading history, bring your trading statement over the last 24 months. I've been running this channel consistently for 24 months now. 24 months and then I have, what, 18 months worth of trading history on the channel as well, where I come on here to analyze and break down the pairs. You can literally see my trading very transparently, okay? If indeed you know that those other pairs work, bring your videos, let's see. Let's see if you've been able to consistent, guys. You know, I'm right nine out of 10 times on this channel. And for those of you guys who've been following me the longest, you can testify to this. And the reason why I'm so spot on and I make a lot of money in this game is because I stick to what the most reasonable and the most reliable pairs to trade, which are the majors, gold and S&P 500. So once again, guys, that is my time. I don't have anything to share with you guys again. Watch out for my next video. I had a really nice helicopter ride up. That's probably gonna be the next video. It's probably gonna come out next week. So watch out for that video. If you have any questions, drop me a comment down below if you found this video helpful. If you haven't already grabbed the Forex Mastery Program, I suggest you do so. The link is gonna be around here, summer. So once again, guys, take it easy, it's just truly dappolis and peace out.