By Brendan Brown
There have been four gold busts under the fiat dollar money regimes since the “freeing” of the gold price in March 1968. Will the current gold boom end in a similar bust?
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52 sats \ 12 replies \ @SimpleStacker 21 Oct
Interesting words. How would a total loss in the fiat currency system play out? Bitcoin will surely be a beneficiary
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50 sats \ 11 replies \ @Undisciplined OP 21 Oct
For sure. Bitcoin/lightning is the only remotely viable alternate payment rail.
The early stages of losing confidence in fiat entail dumping it for real assets. I think that means smaller savings accounts, less demand for dividend bearing equities or bonds, and less interest in cashflow investments like rental properties.
If they're correct about this situation, then we'll likely progress through the stages of hyperinflation, as described by @didiplaywell.
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72 sats \ 4 replies \ @didiplaywell 22 Oct
I really don't think so. The US as been in this position countless times. Over and over again, the rest of the world has performed so, so much worse, that the deficiencies of the US dollar are top performance anywhere else. Perhaps the US government is well aware of this and likes to play this cycles at the expense of the greater stupidity of the rest. Can't really argue against that, not only it's well deserved, but it's a fair cost to pay for the favor of having the US lessening the damage. Most the US will get, as always, is a recession. Then the next cycle will start all over, for has long as the rest of the world remains as stupid.
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62 sats \ 3 replies \ @SimpleStacker 22 Oct
The US dollar enjoys the position of being "the cream of the crap", in the sense that even if people are losing trust in the dollar, they're probably losing trust in other currencies more.
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10 sats \ 1 reply \ @Undisciplined OP 16h
The progression here will likely be slower because of that but we are now in the fiscal death spiral.
They can't afford to service the debt without printing more money. That means the inflation target is no longer relevant, which we're seeing now as they cut rates while CPI > 2%.
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42 sats \ 0 replies \ @didiplaywell 15h
Oh by no means I mean "you shouldn't worry at all". Do worry in all seriousness and do voice your concern, so that more voices join you. I just wanted to clarify that there's an abyss between your worst case scenario and what we have lived in Argentina. But, the only way to keep standards high is to defend your line, no matter how far ahead.
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0 sats \ 0 replies \ @didiplaywell 15h
Exactly. You can see that everywhere. I can confirm that for the entirety of latin america.
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42 sats \ 2 replies \ @SimpleStacker 22 Oct
This could be a good case for to argue why companies should get on board early in integrating bitcoin payments. Even if there isn't much demand for it now, it should preserve your ability to operate in a scenario of global distrust in fiat currency.
That being said, if bitcoin adoption isn't widespread while the economy is going through these tremors, I wonder if populist anger would turn on bitcoiners and suspected bitcoiners would get attacked in the streets in an attempt to coerce their keys
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30 sats \ 1 reply \ @Undisciplined OP 22 Oct
I don't know, but it wouldn't be the worst thing for us to preemptively cultivate a very prosocial reputation.
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42 sats \ 0 replies \ @SimpleStacker 22 Oct
haha not sure how good a job we're doing with that
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0 sats \ 2 replies \ @Solomonsatoshi 22 Oct
Really?
Not stable coins?
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0 sats \ 1 reply \ @SimpleStacker 22 Oct
Stable coins are supposedly backed by fiat so I don't think it would help in a situation where trust in fiat erodes
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0 sats \ 0 replies \ @Solomonsatoshi 22h
For trade payments SoV is not so important as acceptance.
SWIFT is the vehicle of USD/petrodollar hegemony and it is via trade payments that USD/SWIFT dominates.
If you want to make trade payments currently you must hold USD or be excluded from the overwhelmingly dominant global trade payments protocol- SWIFT.
This is why central banks globally must hold USD- or be excluded from the dominant trade payments protocol.
Stablecoins do provide an alternative.
Nowhere are Bitcoin trade payments taken seriously.
MoE is the basis of monetary power.
SILENCE.
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75 sats \ 4 replies \ @Sandman 21 Oct
You know This boom is fueled by debt and inflation. Fears may bust if central banks tighten hard, but strong demand could delay it.
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43 sats \ 2 replies \ @Undisciplined OP 21 Oct
Can they tighten hard, though? They're running monster perpetual deficits and have no plausible mechanism for reducing them.
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42 sats \ 0 replies \ @Sandman 21 Oct
Humm okay! Central banks can hike rates hard, as Volcker did in 1980 despite deficits. But today’s $2T plus annual shortfalls mean debt servicing spikes fast, risking default or inflation. Tightening power exists, but political will and market tolerance are weak. Bust trigger? Yes! Very Possible, but not certain. 🤔🤔
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0 sats \ 0 replies \ @beyond_turbulence 22 Oct
Can the miners really shore up the mountain? Their tunnels run deep and new technologies await (block caving), .:. debt (cash) echos louder than the picks—and no one’s found a way to stop digging without bringing the whole shaft down. It’s why all the native tribes are lining up and claiming ownership of the sacred mountain! Oak Flats? Apache Stronghold!
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0 sats \ 0 replies \ @beyond_turbulence 22 Oct
There’s gold ( silver . copper . . . ) in that mountain, sure—
but it’s the kind mined with borrowed picks and printed shovels. If the overseers tighten the shafts, the tunnels may cave—yet as long as the miners keep dreaming, the digging goes on. Oak Flats? Apache Stronghold!
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33 sats \ 1 reply \ @Solomonsatoshi 22 Oct
Central banks led by China/BRICS have been stacking gold bars for several years while reducing their holdings of USD/UST.
The recent surge in gold price is mainly retail buyers jumping on board.
The central banks accumulation of gold however is not likely to slow down.
China mines most of the gold it is accumulating.
The USD/petrodollar is in terminal decline-
A much more multi-polar world where Gold and Bitcoin are all increasingly held as alternatives to USD/UST seems almost certain.
Both gold and Bitcoin have to be better bets in terms of SoV than USD/UST and more and more people and governments/central banks are realising this.
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111 sats \ 0 replies \ @beyond_turbulence 22 Oct
China (God) mines most of the gold in partnership with who? The crown!?!
The old captains are shifting their treasure chests. Gold bars instead of gold rounds? Tenth of an ounce or ounce mint? How about paper maps, mined from their own mountains, dams, etc.?
Stashed below deck of the ghost ship while the dollar’s sails fray in the wind with the bitcoin submarine saying hoorah!
Retail sailors have just spotted the glint and rushed aboard, but the great fleets—China, BRICS—have been hoarding the shine for years. Optimism in swift? Nah.
Oak Flats (Apache Stronghold)!
The sea’s no longer ruled by one flag; it’s turning multi-harbored. Gold and the Bitcoin—submarine is the new compass, gauge and directed energy sluice box of value—guiding smaller ships once loyal to the high tide fading like a petrodollar reinventing itself (Middle East?) for the low tide.
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0 sats \ 0 replies \ @Solomonsatoshi 17h
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0 sats \ 0 replies \ @beyond_turbulence 22 Oct
Thanks : https://beyondturbulence.blogspot.com/p/gold-busts-fiscal-manifold.html?m=1
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0 sats \ 1 reply \ @035736735e 21h outlawed
stackers have outlawed this. turn on wild west mode in your /settings to see outlawed content.