A reporter at bloomberg news. I am pleased to have all of them at this table. Welcome. You. E start with there has been a lot of bitcoin talk. Where is it at right now . it is probably oh, god. Probably the fourth or fifth wave of interest of this thing. It has waxed and waned in terms of speculation and attention in the mainstream. Certainly in terms of price in dollars, this is the biggest move it has had. In terms of interest, probably the biggest too. Not totally in the mainstream but much further than it had been. Jeff is it still at hype phase . Rine the market cap, the Network Value bitcoin with bitcoin is a little over 100 billion. 100 and has come up really fast but it is at a fraction of apples valuation, amazons valuation. Jeff and certainly a small fraction of the overall economy. A very small fraction. For all the cryptocurrencies, which there are like 1000 different digital point. It was 12 billion a year ago. It has been doing pretty well in the last few years. Jeff bitcoin is far and away the most popular. Take me back a little bit if you would. Bitcoin is invented in the wake of the Global Financial crisis. Why and how . Original e in the the original white paper announcing the concept was released in 2008 by somebody calling themselves toshi nakamoto. We do not know who this person really is. Whoever it was, they had been working on it before the financial crisis they released the white paper. January 2009, they launched the open Source Software line. Not a mono put it out in the world and let anybody who wanted to put the project on. The Financial System has collapsed. The central bank had to pour in and put money into it and save it. It was. As an alternative to the banking system. If you released that idea at the time, it might not have taken off. A group of people, there are all kinds of theories. Because of the timing that nakamoto chose, the thing really sort of first in the hacker, hobbyist, engineer, developer communities. And then it started to get out a little more and a little more. They kept growing. Or 2013, it started to step into the mainstream. Jeff this is one of the most intriguing parts about it, the speculation of who nakamoto is. Lily a lot of people have stepped out and claimed to be not komodo. Nakamoto. Outed eople have four people have been ousted. And say this is nakamoto they say no i am not. Lily people conceptualize this world where transactions are cheaper because they are not going through bank and more secure because they are protected by the block chain. To like is why the base it, which is in part why jamie dimon famously slams bitcoin. There has been a lot of discussion. Catherine a lot of discussion. This is increasing the publics increase minute. You have jamie dimon, public figure, very wellknown along with howard marks of oaktree. Interestingly, the following comments, jami the ceo of Morgan Stanley was speaking about it in a different tone. I think they are beginning to see trading opportunities. They are not endorsing it just saying we are interested in finding out more about this because the clients are asking about it. The results of the ceo of blackrock who came out and talked about it. Jeff you started introducing more folks to it, which leads to the question of i do not want to get too far ahead but it leads to the question of regulation. Much of space and Financial Services being involved not just banks and Financial Services being involved, but the government being involved. Paul there are a couple of moving parts there. One, you have people working on bitcoin it else and that project itself and that project. Wereally, a lot of them antigovernment, and i regulation. It was designed as a hacker projects that wanted to get around the system. Create a network or you do not need the middlemen. Distances came in and then we can build a business on this. We want legitimacy, we will need to be regulated. They started reaching out to the regulators. Our or five years, you have a dynamic where one group is adamantly antiregulation and the other group that says we want to bring this into the mainstream. We think this has value for people in their everyday lives, let us build regulations around this. And then have every regulator on the planet at the point where ave to figure out what this is for the economy and how to address it. Jeff explain this to me. Jamie dimon was critical but said he believed the Block Chain Technology is legitimate. What is that . Paul that is another hour. [laughter] the concepts behind bitcoin, behind the software, have probably come to become Block Chain Technology. s set of ideas that is essentially taking, creating a network where anything that can be digitized to be traded between two people directly. I have an asset i want to give you, let us say a mortgage deed. Give can take it and digitize it, stick it in a transaction on this software program, send it over to you. That gets timestamps in the network. The idea that gets timestamped in the network. An email. Sending instead of sending any moment anrth, you are sending email back and forth, youre sending something that has value. Bitcoin is this open source, nlessssion network that anyone can control. Jeff because this was verified publicly . Paul yes. What happens is every computer on the network has a copy of this letter and every transaction gets updated on ger at the same time so he can be verified. The process makes it transparent. That is what makes the banks unnecessary. Previously, you would need a thirdparty tracking those transactions. Lily in the original white paper they talked about proof versus trust. The system we have now is based on trust. Trust a bank to keep your stuff secure. This is based on truth because you have computers that verify transactions. Jeff or a kvitova cup of coffee . Or it can be a cup of coffee. Lily yes catherine yes. People say they cannot see the cup of coffee. We have with where people can conceptualize it. I had trouble understanding that back in the day. Today we have a voice over ip. With this is is money over ip. The transition of money over ip will be free again like the analogy there. Chainstinction, block in silicon valley, we heard that we like this block chain but do not like bitcoin. We were saying in terms of the bitcoin block chain, you cannot have that unless you build it out and incentivize the minors with the bitcoin. You cannot separate them unless in jamies case wants a wild garden trusted network. Permissioned. D the bitcoin block chain is permissionless. Jeff you are saying it is too vulnerable to hacking. It already comes to the volatility to be sure but those who criticize it say it is dangerous . Catherine this is the same criticism we heard about the cloud when it first came out. Everyone said that could be hacked. That is true. Anything can be hacked. What the c the cloud was an open sourced system. When you have a lot of i was watching the system and a lot of livelihood and businesses dependent on it, you have a lot of people watching it. You are seeing what a hack start. The news travels really fast and it stops. We think the permissionless walkins are very robust and secure relative to the permissions ones. I dont think the argument is if it is vulnerable to hacking ng scams. You all the hacks that have happened. Look at equifax recently. The systems we have built up over the past few decades are extremely vulnerable to hacking. Hacking is not the real argument against bitcoin. The real argument is that it is system that authorities cannot control. They do not control the money in it, who is using it, and what they are doing it for. Dimon doesnt want that because it cuts into his business. Regulators need to figure out is have atething we can least enough control over that it is not going to destroy the economy, that it is not going to abandon the government, the the government. Can we accept some type of darknet transactions . Coin is somewhat anonymous as a currency. Cash is a completely anonymous currency. Theres a lot to be figured out. Not just money, it is the technology. You have three forces coming together. The regulators want to impede the technology. They do not want to be accused of preventing the next internet. They are stepping lightly and we are even seeing very recently, groupsthe last week, beginning to agree on bitcoin versus other crypto assets. Some should be regulated by the sec and some should be regulated by the commodities exchange. The other thing that we see going on is fear on the part of edgulators in the develop world. They are stepping lightly. Jeff what you say to investors when they are looking at volatility . 1000 or so this year all the way up to 6000 and a span of nine or 10 months . Not the first very dramatic swing up or down that has happened. You dont think i will end anytime soon . End anytime soon . Catherine we size day. Out of this market right now. A captured a lot of peoples imaginations. We will go through heights hypes and then shake out. It is being Battle Tested almost every day. Russiaanning it, banning it. That bitcoin tests has gone through and they did it came right back. It is so resilient, at least in the last year or so. You now have bitcoin and bitcoin cash. People were scared before this happens and the prices dropped but then it bounced right back up. Na banme the initiald banned the initial point offering that it went right back up. Paul until the point is that some assuming it gets jeff any time soon. Paul that process will go on for a long time. It is extremely volatile, but there are people like that kind of volatility. They are called traders. Derst of wall street tra are interested in this now because they can make money trading it. People who have been doing this for a long time our total cowboys. They love this thing. They stay up all night and traded and they do not care if it goes up or down. They are looking to make money off of it. Bitcoinsh attraction is it is volatile. Group ofstill a small people trading and they are true believer tight and a lot of people are buying and holding it because they think is going to a 50,000 price. Coin bitcoin is a on to some extenteway trade. Is a oneway trade. To some extent, they think there is something going on with the company. It is not like that yet. Catherine we found a way to measure it. If you do it on a 12 month moving average basis, it had come down quite significantly. We compare it to twitters stock price. It dipped below that and dipped below gold and volatility last year before this next run up. Volatility compared to where was an 2000 11, 2012, 2013 has come up quite jeff what is the difference between buying and mining . Lily buying a cryptocurrency is literally paying money to have a coin. L point. Mining is a process i liked it think about it is people sitting around in their basement around the computer. Theyre looking at transactions happening around a block chain to digitally time stamp the reactions and make sure there is no double spending happening. If you have cement counterfeit a dollar, they can spend and two places. Jeff talk to me about what is associated with bitcoin currencies. There is only one way we can gain exposure is a registered Investment Company to bitcoin. It is only bitcoin we can access. That is through an overthecounter security. We are just rating and the just trading in the stock market echoes overthecounter. Fees have changed over time for bitcoin. One complaint is what people call the scaling debate. Basically, people are concerned that Bitcoin Transactions are getting too expensive and slow, and that is actually why Bitcoin Split in two. Two rival camps could not come into agreement and there andargument about high fees the slowness of the network. They jeff moved some of the transactions off the network. Jeff if i am buying coffee for a couple bucks and i pay for a credit card now, mastercard and visa will take a couple Percentage Points and American Express will take more, where is the money going . Is going tohe money starbucks or whoever you buy the coffee from. Who else is taking paul you were talking about the fees. Designed, was when bitcoin was designed, there was a fee. There was always a fee. It goes to the miners. This is a process transactions. It is the design of the network. In the early days, the transactions were so small that it didnt matter. Iat fee, a voluntary fee that you didr the miner not have to offer them anything because there is a strain on capacity. This year because there were more transactions, you are getting bottlenecks. What people were doing was offering higher fees to get their transactions put to the front of the line. Jeff some countries are embracing and some are banning it. Including china. Paul china seems very antibitcoin. South korea, north korea. Although north korea might be stealing it. South korea is starting to embrace it. In switzerland, they are pro actually the u. K. Is interested in it. If you talk to government types, they see there could be some value their and something they want to help build out. And something they want to build out. Ntry is trying to come to grips with it. Howard. E that is why china did it. They were trying to get capital out and control that. The regulators are thinking about monetary policy. They are thinking about capital movements. The technology, they have to do a double take because they are saying if we ban this, we are banning this potential engine of integration innovation like where the internet was in the 1990s. Do we want to do that . No. Especially in the developed world. Youre seeing a careful analysis. One person believes it is going to be extremely disruptive and she came out saying so a few weeks ago. Credibility byns calling a spade and spain, i think a lot of people set up and notice. Jeff an accomplished writer and editor in the series final and a lifelong fan of the chicago cubs chicagow book cubs. His new book tells the story of the team from its founding to its triumph at the world series. A lens memoir, reporting, history and baseball feel itchy to explore the longheld question, why cant the cubs win. Henm least to have rich co back at this table. Life is great. You can die in peace. The cubs did win. Rich the road trip ended so we are searching for meaning a little bit. Jeff you still want to win this year. Rich more than anything. People ask me why i am a cubs fan. I dont know. It was given to me when i was a kid but it becomes so intense you try jeff the doctors are good. Rich i the dodgers are good. Rich i am happy living in the past. Jeff honestly, how long does it last . Was it as satisfying as he thought it would be . Rich it was disorienting because the cut had not won in 108 years. Andng was so regular happens in such weird ways that we turned it into a kind of religion. I thought being a cup span major kind of better because they were buddhists. E you have given up on the idea of ambition. You are just enjoying the game. When you wore the cubs hat, you told the world my kingdom is not of this world. We won and i think the red sox and went through the same thing. The identity changes and you realize your children grow up in a strange world where they think the cubs are a great baseball team. Rich with it jeff was it early banks who said it was never a curse but a fear . Rich i think in one of the last interviews with sports illustrated, the points were the curse became serious was 1969 where they had an incredibly great team up by seven games in september and they collapsed. I asked what is the curse. He said it is not voodoo, it is fear. When you have never one in your team has number one and you and you have never won get into highpressure games in the season you do not know how to win and you choke. The owner of the cuts that to me the reason he thought they did not win was because you build a 162ball team to win over a game season and you get into the playoffs and it is a crack it. Crapshoot. To increase your odds, you have to go back multiple years and they never competed in the playoffs since the early 1900s. Also, this is their Third Straight appearance in the nlcs. As a chance to be there at the end. The it is a fear among players, the ownership, the fans. It is pervasive. Rich i think it is almost like a psychosis. One moment that was hard for me thethe bartman game where fan reached for the ball and the cubs fell apart. The fans at wrigley, whom i love dearly, instead of taking out their anger at the players, in the field they turned to bartman, the fan. It is like something is happening to you and youd dont know what you did to deserve it. Youou dont know what did to deserve it. Jeff i am a bills fan. Im waiting to get over that hump. Be, andthe cubs come to it certainly wasnt the same way back then than it is now. Rich i am not really a sportswriter. It isan history American History shot down in a way you can understand it. The saying if you tell story of the cuts correctly, you are telling the story of america in a fun house mirror. Baseball came out of the civil war and away in a way. In cincinnati, they put together a team full of ringers. The team came to chicago and crap out of the great chicago teams. They were like, do you think you are better than us . They put together another team of ringers. They were called the white stockings. Theyed stockings beat the red stockings. The real source of the curse is their first great captain created the color line in baseball. Doubleplayamous combination. In 1906, they one 116 games won 116 games. They were like the yankees 1940s. N the1 they dominated. Jeff how did they go from that seem to falling off the end . Rich they say good. Y won 700 games and eight in eight seasons. They went to the world series but would lose. It was a corporate thing. You had a corporate coulter. Sports is not necessarily make sense as a business unless you love the sport and want to win. To win. Wrigley wanted his son really didnt care about baseball. When asked about his favorite sport he said craps. I didnt even know it was a sport. Maybe if you bring your are back and forth you can break a sweat back and forth you can break a sweat. He was like i dont care about the sport but i wanted bring people out so he made wrigley field. Jeff what is sensational postseason . In terms of the teams you have, youre the biggest teams and new york, chicago, houston all competing here. Three of them have fantastic pedigrees. Houston with what is happened with the team that is young and dynamic and exciting, i have to imagine Major League Baseball is pleased with what they have seen this fall. Rich not only that, i think personally baseball is ever then it has ever been. The games are maybe a little too long. I have little kids and i know you have little kids. The move away from football a