Bitcoin is up by about $600 in a mini bull run to above $10,000 ahead of the much anticipated Fed interest rate cut.
The currency rose by about 5% from circa $9,600 to now above $10,000 on slightly increasing volumes.
So sending ethereum up by about 2.4% as well as many other cryptos, with bitcoin clearly leading.
Zoomed out a bit, bitcoin has a massive cup and handle, but on trader’s 30 minutes candles, this appears to be on a bull run of sorts.
The reasons are many. Trade tensions in China. Brexit no deal fears. As well as what will be a very first.
Bitcoin is to experience the first rate cut since its invention in 2009 if Chairman Powell does go ahead with what everyone is betting: the first rate cut since 2008.
For about 8 years Fed kept them there at near 0, until 2016 when there was a little rate rise, followed by a ladder:
Following some jitteriness in stock markets and a 2018 that saw one of the worst performance for pretty much all assets in some years, Trump got angry.
He first shouted something to the effect of: stop the interest rate increases or I’m fire you. Then he basically said: good, now cut them. Then he asked: stop with quantitative tightening and get on with easing.
The corporate media is saying Powell must do everything to not appear like he is following Trump’s orders, but Powell’s sweat levels must have increased considerably after he saw Erdogan fire the Turkish central banker.
So they can say what they want, everyone knows they’re doing what Trump has basically ordered.
Trump’s argument is that other countries are devaluing their currency and taking advantage of US in a sort of mercantilist worldview where cheaper money means others buy more of your goods.
Everyone ignores the fact it also means you’re getting paid less for the same goods, with CNN either in sarcasm or perhaps with a straight face quoting some professor as stating: “It’s all about the growth in the money supply. That’s what drives changes in nominal GDP.”
Apparently, “the number of notes and coins in circulation plus bank accounts is growing at 4.8% per year.”
That’s kind of a hidden literal tax, devaluing your purchasing power through what is really the counterfeiting of money.
That inflation is at just 1.6% while money supply is apparently increasing by close to 5%, probably shows the ingenuity of innovation and productivity increases.
Yet arguably such real growth is sort of being stolen through far higher levels of growth in money supply. Stolen because that fiat “block reward” that mints new money doesn’t quite go to the one that is producing. In fact, their production is the “block reward” that goes to bankers.
Lower interest rates might lower such block rewards, but it does look like Trump probably has in mind the monetization of debt.
As in Fed prints these “block rewards” and buys debt from the government, with this being a tax that lacks transparency.
This greedy tendency usually continues until it all expands too much and so collapses under its own weight, with something a bit dangerous going on where money is concerned.
Trump accuses China of bypassing US tariffs through devaluation in one breath, and in another breath says China is doing terribly.
The problem is this sort of nationalist approach can lead to a currency war where everybody prints baby prints with some catching the flue while others lay on their death bed as in Venezuela.
The lack of any objective mechanisms of control in the matter of money can lead to a situation where money becomes effectively completely detached from reality.
That is where money becomes politicized, as it has been pretty much since its invention with the devaluation of gold coins by reducing their weight, the devaluation of paper by reducing the corresponding amount of gold, and then the ditching of any anchor to reality completely.
With all this beginning to sound a bit like sorcery, or worse. Esoteric, subjective, nonsense where our work is manipulated through fake units of account that have no mathematical basis nor any reflection on actual concrete reality.
It’s Nietzsche at its worst. The man who went mad because he lost so much touch with reality, he basically broke his own mind which is of course designed to be objective.
Where current money is concerned, however, there’s almost nothing objective. The worst part is bank money. By a stroke of pen, unaccountable banksters can make anyone rich through “loaning” printed from nothing units of accounts.
Likewise they can keep anyone poor by not extending such units of account. With no oversight whatever in this activity. Nor really any regulations.
It’s sorcery. But of course there’s always bitcoin. That one is maths. That one is the antithesis of Nietzsche. It’s more… the living god that he couldn’t kill.