market

market

COVID-1984

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Charles Hoskinson, the co-founder of Ethereum, made a good point on the issue of the new crown. He observed how our economic rights were suspended, how our constitutional rights were suspended, how our freedom to travel was suspended. In my view, the government has overstepped and used the fear created by crises like 9/11, drug overdoses on the Rave Act, and COVID-19 to further weaken personal and economic rights. Meanwhile, the world's wealthiest people, from Bezos to Gates, have grown even richer from the vast amounts of money printed by the coronavirus lockdowns. This money devalues ​​currencies effectively, from the dollar to the pound to the euro, pushing us to the brink of hyperinflation. That money goes to the tall of the short, including the stock and bond markets, real estate, gold, and bitcoin. Guess who holds most of these tools? Certainly not most students or millennials or Gen Z.

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Control of Information and Money"When things go really bad, people tend to want quick fixes to difficult problems. They tend to support egalitarian governments. Yet it is these egalitarian principles that often create dire situations in the first place. Historically, genocide is an unfortunate and not uncommon outcome. Yes, on paper egalitarianism sounds great - everyone is equal. But the imposition of such a principle always leads to the incompleteness of individual rights. Confusion arises when equal opportunity is confused with equal output, equal input, and equal income. Forcing the latter always leads to violence."For 953 million people in 20 countries with weak currencies, bitcoin represents something greater than a treasury asset.

While I agree with this statement, it can apply to almost any country, as all central banks continue to print more money than they have in the past, and if you know history, you know it's a race to devalue.

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Gold and real estate have a loophole?

"The chairman of the Commodity Futures Trading Commission (CFTC) said in an interview recently."

Let me just say how impressed I am with Ethereum, full stop. When I think about this as a regulator, I think about email and the Internet. If Bitcoin was like email, one trick but clearly revolutionary, Ethereum is way beyond that. It's like the internet.

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high inflation

1) The Fed will have room to reduce the flow of QE. But if they are not careful, it could induce a huge correction in the market. Of course, every time they tried to slow, stop or reverse QE since 2009, the market reacted badly. Each time, the Fed had to step in quickly and increase QE, which put a floor on the major moving averages. Since 2009, only COVID-19 has created a market correction of more than roughly -20%.

2) History has shown that deflation is a precursor to high inflation when there is too much money in the system. M1 has shot up, while M2 velocity remains stagnant, so inflation remains below the target rate. The United States printed more money in 2020 than it has in its entire history since it gained independence in 1776. The Fed's goal is an average inflation rate of 2%, while the interest rate in the United States is close to 0% and is going negative, which indicates that more trillions of digital currencies will be created. Once consumers start to regain confidence and start spending, this could induce runaway inflation that the Fed will then be powerless to stop. This happened in Germany in the 1920s - deflation followed by hyperinflation.

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The wave of investing in Bitcoin is coming

Nonetheless, famous investor Jim Rogers said that Bitcoin has counterparty risk, but that only applies to putting your coins on a centralized exchange, which can be hacked. People should always keep their coins in their own wallets, guarding their private keys, or better yet keep them offline in cold storage. When users store bitcoins in their own wallets at the underlying network layer, no third party can seize a user's bitcoins or censor their transactions. This is why Bitcoin is the safest option, even surpassing gold which can be physically seized. FDR made all Americans surrender their gold in 1934. Owning even a fraction of gold is illegal. With Bitcoin, you simply memorize a 9-word seed phrase into your wallet, and you can transport your cryptocurrency anywhere in the world, bypassing any form of border control.

Rogers has also said that governments will kill Bitcoin if it scales significantly. In fact, governments such as China and Russia have a love-hate relationship with blockchain. Both have attempted to ban various aspects of blockchain technology over the past few years. But they realize how powerful its economic impact is on them.

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Digital eats everything