pull down to refresh

‘ Having the reserve currency has been called the ‘exorbitant privilege’. There was a French finance minister called Giscard d’Estaing, he called it the ‘exorbitant privilege’. And what he meant is that you get away with a lot of bad behavior when you have the reserve currency. You can do a lot of risky things, but we’re kind of rapidly approaching Johnny Depp, Charlie Sheen, types of levels of irresponsibility, I think fiscally. ‘
Good interview. I followed Trennert for many years before I discovered bitcoin. I even read his book. Interestingly, this is the first time I have ever heard him talk about bitcoin, although he's been sounding the US debt alarm for years.
reply
I wonder to what extent Bitcoin’s fiat price and adoption rates will map to the unwinding of this exorbitant privilege.
reply
I don't know, but I think as bitcoiners we naturally have a warped sense of its current perceived relevance. I don't think the correlation will be in a straight line. In some parts of the investment world, bitcoin is still basically looked at as a risky tech company. The fx guys don't see it on their radar screen yet either, so as the dollar unravels it will be measured comparatively to other fiat currencies. That of course will change as bitcoin adoption grows. I just don't know how long it will take.
reply
‘ Reserve Status Is Not A Right
The United States enjoys one of the most exorbitant privileges that any nation can ever experience via the dollars role as the global reserve currency. With the U.S. dollar serving as the backbone for financial transactions and global markets for almost 70 years it is almost inconceivable to think of a world where this is not the reality. Difficult, but a mindset that ignores historic precedent; multiple nations and empires have held the global reserve currency in the past, and the U.S. is simply one in a long line whose currency has held this position. ’
reply
What Will Happen To Bitcoin Prices If The Fed Lowers Interest Rates?
‘ There is always the tension between demand and supply as well - as a peer-to-peer market, there isn’t necessarily any external force that is propping the system up… This is the opposite of fiat-world: where the ECB, for example, is bought up a strong amount of European sovereign debt - in 2022, an estimate of “only 40%” Eurozone sovereign debt. In fiat-world, there are many forced buyers, but few forced sellers. In Bitcoin, it’s the opposite - nobody is mandated to buy Bitcoin… ‘
‘ In the short term, it’s likely that cutting rates will help all risk-on assets, including Bitcoin. In the long term, it will also contrast and compare Bitcoin’s model to the fiat model - with central banks prone to reducing rates and letting money supply inflate at the first sign of real economic trouble - proving out why a scarce, distributed money rather than arbitrary dictates in the service of the few would be beneficial to many. ‘
reply
Mike O’Sullivan:
‘ In recent notes I have started to cover how high debt levels will change politics, and on how indebtedness is part of the equation of great power rivalry. ‘
‘ In time, the ability of national financial systems to work through debt will be a marker of the rise and fall of nations in the 21st century. ‘
reply