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Is Bitcoin Going Cheech And Chong A Bad Signwww.zerohedge.com/crypto/bitcoin-going-cheech-and-chong-bad-sign
406 sats \ 10 comments \ @siggy47 14 Aug econ
If no economic statecraft tools are used to ensure liquidity flows to the supply side, we could see an inflationary boom in which most assets (except bonds and the US dollar) would do well in nominal terms, then a bust.
NGU is not always a good thing.
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36 sats \ 8 replies \ @justin_shocknet 22h
NGU is not always a good thing.
Yes it is, NGU means Bitcoin is filling it's intended purpose of preventing PRICE inflation in the real economy during an inevitable environment of SUPPLY inflation. The fiat supply MUST increase because of the nature of the debt-based monetary system, you can't taper a ponzi.
Bitcoin being savings technology makes it a battery in which to store these new dollars and keep them out of real assets like housing and stocks that effect price signaling functions of the economy.
If stocks pump, regardless of underlying earnings (sats flow), that's bad because it distorts capital allocation and thus productivity cannot keep up with supply inflation, thereby exacerbating price inflation.
I'm not sure what Rabobank is getting at mentioning bond rates in all of this. Low rates means the price inflation hurdle is low, else long-end yields would go up. The short end is increasingly being bought up by stable issuers, and the new dollars printed to pay that interest aren't going into the economy... they're going to savers in the form of Bitcoin (Tether using the yield to buy Bitcoin)
What we are witnessing is a gradual redirection of new dollars from a high-time-preference trash economy that causes inflation to savers that unlock productivity.
The architects of this are far smarter than any blogger with limited intel.
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0 sats \ 5 replies \ @ZezzebbulTheMysterious 15h
You are missing the other side of the trade. Bitcoin doesn’t store the dollars. It doesn’t destroy them. It stores the “value” of the dollars for the buyer of the coin. Obviously the seller wants to get rid of the dollars as soon as possible.
The dollars still exist in the system. They were printed, and then traded. They don’t go away. The only way dollars are removed from the system is through taxation (or tariffs). Tax is simply deleting dollars from the system.
The person that sold the bitcoin for dollars then purchases assets (because why else). So Bitcoin does not and cannot prevent price inflation (in dollars). Only reducing the dollars can do this.
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0 sats \ 4 replies \ @justin_shocknet 15h
Taxation doesn't destroy them because the gov spends that, it does slow velocity though...
Debt destruction is the only dollar destruction, since dollars are debt, and Bitcoin is a replacement for new debt... The Bitcoin sellers are selling Bitcoin instead of creating new debt to buy that stuff, they're buying it with debt that was already created and given to tether.
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0 sats \ 3 replies \ @ZezzebbulTheMysterious 15h
The government prints the money it spends, the source, and taxation is the sink. Taxation is burning dollars to offset the printing. It’s not actually recirculating. If you print more than you burn you get inflation of the monetary base.
Bitcoin just lets you opt out. It’s not fundamentally changing the properties of M2 of dollars.
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0 sats \ 2 replies \ @justin_shocknet 15h
That's the velocity component, spending exceeding taxation is a given since it can't run in reverse or there'd be no dollars.
Since there has to be new dollars, Bitcoin gives people a place to park them that doesn't moon shit we need like houses...
The sellers of that Bitcoin aren't getting those dollars from their own debt and therefore increasing the number of dollars (commercial banks create dollars too on consumer debt, not just the Fed on national debt)
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17 sats \ 1 reply \ @ZezzebbulTheMysterious 14h
Ok, I think I get you. We are saying the same thing from the other side.
The existence of Bitcoin helps provide an alternative sink for value that is not other assets like Real Estate and Equity, thus helping keep prices from pushing up.
Yes, and I hope that our civilization can flourish when we stop inflating the value of real estate.
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0 sats \ 1 reply \ @Solomonsatoshi 21h
How does stacking sats unlock productivity?
If bond rates go up the US govt is facing insolvency.
China has won the trade war.
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41 sats \ 0 replies \ @justin_shocknet 21h
How does stacking sats unlock productivity?
By restoring price signals in the real economy in the face of supply inflation
If bond rates go up the US govt is facing insolvency.
Good thing the NSA astroturfed Bitcoin then isn't it? Those higher yields directly flow directly into Bitcoin... which the US already owns the majority of.
China has won the trade war.
LOL
... and it hasn't even started in earnest. Another still shoe to drop.
Do you think a Taiwan blockade is in the cards or no? What odds do you put on it? Also what odds do you place on the possibility Trump/Xi are actually working together in clandestine fashion to liberate their respective countries from globalist financiers?
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36 sats \ 0 replies \ @Undisciplined 14 Aug
I don’t see it
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