TAKEAWAY NUMERO UNO: If there's a successful book titled Broken Money, you DO NOT title your own marketing pamphlet/e-book style "Broken Money" as well.

I spent some time today looking through the Invity people's fintech offering. We met at BTCHEL, where they launched/announced some cool banking features for us Europooreans. #1580878, #1581849 #1585380

Particularly, quite convenient auto-stacking, payment cards with bitcoin/stablecoins, and juicy-af cashback on every spend. (Up to stupidly low maximums, it turns out -.-)

This is all very tempting, and Den is a sucker for a good sats deal (aren't we all?!), so what does a bookish nerd do?

Download and read the free e-book, of course!

It's from their educational platform, Invity Academy (as if we didn't have enough educational outlets...):

It is meant for people who know Bitcoin from headlines and debates, but never got an answer to the most important question: why did it come about at all, and what problem does it solve?
We start with money itself — how it came about, how it works today, and why so many people feel that something about it „broke“. Only once we understand the problem does it make sense to talk about a solution.

Oh, turns out this is really for Mr. Den. Let's dig in.

Blah-blah-blah, money's three functions, and various properties (ignoring, for now, Erik Yakes' 7th Property, Immutability #1572208)

...gold, commodity money, stock-to-flows. Alright, amazing. State intervention, Roman coins.

"If you were born after 1971, you live in a historical anomaly"

Pretty neat account:

• 1870-1914: Classical gold standard
• 1933: gold banned
• 1971 Nixon Shock

They definitely overdo the importance of 1971, a mere formality in a world already addicted to fiat and money printing. (1914 is a more important civilizational cutoff.)

Cool, but graphs like these are pretty boring. A dollar, like a bitcoin, is not a meaningful economic unit; nobody (rationally) cares about a dollar, but the relationship between what they have and earn to what they invest and consume. e.g., #737272, #1578595

1913 the Fed, 1933 the ban on holding gold, 1944 Bretton Woods, 1971 the Nixon Shock — four steps from hard money to fiat. → Since 1971 no currency in the world has been backed by anything tangible

VERY nice

How money is actually created today
→ The vast majority of the money in your account was created by commercial banks, not the state.
→ New money comes into being at the moment of a loan. When you repay the loan, the money disappears.
→ QE lets a central bank create money in the order of trillions within weeks.
→ The M2 money supply grows substantially faster than real output.

AMAZINGLY witty: "Money-supply inflation is the cause, price inflation is the symptom."

Here's a scary graph, but of course financing conditions matters too: An average interest rate for mortgages in Czechia was about 7% in 2000; below 5% in 2025.

Inflation as a silent tax

Modern central banking is often defended with the argument that it stimulates the economy and creates jobs. Even if we take that at face value, we must at the same time see the flip side: the money a central bank creates does not arrive for everyone at once. It travels a predictable path that structurally favours one group over another.

VERY eloquent and punchy.

At the end of the pipe stand

• The fixed-wage employee: the wage is usually adjusted only with a delay, and not by the full extent of inflation.
• The pensioner — the pension is indexed once a year, slowly.
• The young family without assets — they own no assets to rise in value, yet pay higher prices for food, energy, rent.
  -The saver on a savings account — the interest does not cover the loss of purchasing power

These things are conditional and not obviously and always the case; boomers in America enjoy pretty competitive COLAs; interest rates on savings accounts in Iceland are ~halfway between CPI and monetary expansion. With bond prices collapsing, rates on (high-yield, short-term) bank accounts like those at fintechs are bound to rise explosively. #1578425

NOTHING STOPS THIS LYN ALDEN TRAIN

Yeah, dudes didn't just borrow Lyn's title; they take her fiscal framework too: there's no way back/out from governments' profligacy and debt-to-GDP ratios. America just cannot outgrow 40trn in debt (...unless we scalp the boomers #1468968, you know the drill.)

An economic term returning to the debate in recent years is fiscal dominance. It means a state of affairs where the state’s budgetary situation is so strained that the central bank cannot run an independent policy. Lyn Alden describes that the United States entered this situation around 2022. The interest cost on US federal debt exceeded the defence budget in 2024 — and that is a defence budget which is itself larger than the budgets of the next ten largest countries combined.

The financial FIXES that used to work:

• The 60/40 portfolio: yeah, it's entirely dead. Also, bonds don't provide neither uncorrelated returns, nor inflation-adjusted returns at all.
• savings account: guaranteed losses. Czech republic example is ~4% interest on savings, 2.5% official inflation... BUT tax the nominal return 15% and assets like flats and properties rose way more than 1-2%.
• New fixes?

Holding large cash in the bank is, over the long run, a strategy by which the state really taxes your purchasing power. Diversification remains valuable, but it must include assets that respond to monetary degradation (hard assets). Gold passed the test of 5,000 years. Neutral, apolitical, independent of the banking system. Bitcoin is new — it has 15 years behind it. But if its properties are confirmed, it offers everything gold does, and more: portability, verifiability, divisibility and neutrality in a form gold can never have.

...in PART 2, dudes move on to the orange solution: _bitcoin_, woop woop!