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36 sats \ 10 replies \ @0xbitcoiner 23 Oct \ on: Trump Admin To Take Equity Stakes In Quantum Computing Firms Stacker_Stocks
Not sure if this is good or bad, but it’s definitely sending a clear signal to the markets. This isn’t Trump’s first equity investment, and it probably won’t be his last.
I guess it depends on if you're willing to accept an even more centrally planned economy. We already have a federal reserve bank, so what the hell?
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This all goes back to "Black Monday" (ie. 22% stock market plunge on a single day in 1987)...they put together the PPT (Plunge Protection Team) to "stabilize markets".
Ever since then we've never had any real free markets....they've come to rely on the PPT so much that by 2008 it morphed into direct daily trading to "stabilize" markets.
We have no choice at this point but accept it, the genie is never being put back in the bottle. In fact I would say don't just "accept it", but "embrace it".
This is after all why we invest in Bitcoin, because we know how this ends.
(Note: You could actually make a great argument that all this goes back to 1933 Executive Order which banned Gold payment clauses in contracts....that was actually a sort of proto-"plunge protection team" in effect)
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I would go back to 1933, or Jekyll Island. I'm old enough to have taken a big hit in 1987. Back then we all gathered in the local Charles Schwab office and watched the ticker. I'm sure I rooted on the PPT. My measly net worth was getting crushed. I didn't discover the Austrians until 89.
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1933: Laid the keel. (No refunds)
1987: Almost sank the fleet. (Blamed the wind blowing new strength into your being)!
1989: Realized the harbor was just a suggestion. (Tectonic plates: the original micromanagers)!
The ocean is a terrible architect—but a fantastic performance reviewer. Needs improvement, buoyancy. Strengths: dramatic exits. Now pass the life jackets.
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Honestly, I think governments should stay out of the markets. But I don’t know all the ins and outs, so I’m not sure if it’s a good thing or not. Might be great for the companies and their investors, but probably bad for taxpayers.
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So I can speak to one deal just cause it dealt with what I do at work. The Lithium America Thacker Pass Mine has been in development for 6-8 years… can't remember off the top of my head… the biggest issue facing them has been enviro/greens lawsuits against them 24/7.
Last year DOE gave them a ~$2 billion loan to help speed up development of it. The Trump admin switched details of the loan to not only a stake but also extended the loan repayment by another 10 years I think. This change also comes with an exit plan that when the mine/company hit different milestones the government will be selling off the 2% stake they have (stake in company could be more but the stake in the mine is only 2%).
One of the biggest positives for this pseudo-acquisition I that the permitting is now able to be supercharged and the project can't keep getting sued for the same thing over and over.
Do I love it? No but I do think it's better than the loans… loans we got nothing out of it no sort of collateral but in this way we do.
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Yes, I found this:
Loan size: $2.26 billion (including $1.97 billion of principal and $289.7 million of capitalized interest)
So that's probably neutral vs treasury cost. 1
I'm not sure if the ownership is long-term beneficial unless there is zero chance of adversarial office holders in the future, but that's another discussion.
Footnotes
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Also, for scale, this is about 17h worth of total US debt interest. By the time you wake up tomorrow morning, this has been spent. ↩
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