Big Falls in Bitcoin and Crypto Markets — GEOPOLITICAL OR COVID? — Vaccinated Versus Unvaccinated — Energy Price Collapse Coming? — A Trusted Money System — The BOOM Solution [11-21-2021]

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THIS WEEK’S EDITORIAL

BIG FALLS IN BITCOIN AND CRYPTO MARKETS:  Over the last week, the US Dollar price of Bitcoin has fallen by 8 %.  Since its recent price High on 11th November, ten days ago, it has fallen by 15 % and the total market capitalization of the entire Crypto world has fallen by 17.3 %. That is a very big fall in price indeed in a very short timeframe.

BOOM’s regular readers would not have been surprised by this turn of events. Why? Because, in the BOOM editorial of 24th October, BOOM warned readers by writing — “the BITO ETF can be manipulated down via well known pathways of manipulation that exist in a cash settled futures contract listed on a futures exchange”. The Bitcoin Strategy ETF — BITO — based upon Bitcoin Futures, began trading 5 weeks ago as an Exchange Traded Fund on the Amex Stock Market.

A new ETF called CRYPTO Innovators was launched on the Australian stock market on 4th November. The ASX Code for it is CRYP. It has fallen by 16 % since its price High on the 9th November. Ouch.

While these price falls in Crypto commodities have been occurring, the US Dollar Index has been rising strongly. And the price of Oil in US Dollars has been falling.

Perhaps all the falls in these commodity prices are the result of US Dollar strength? If so, why is there a sudden rush into the safe haven Reserve Currency? That is usually seen as a global “Risk Off” move in anticipation of a major Geopolitical threat.

EXPLANATIONS — GEOPOLITICAL OR COVID:  When looked at from a high vantage point, it looks like large, liquid funds are moving into US Dollar bank and brokerage accounts from offshore currency holdings. The two major Geopolitical threats which could explain this would appear to be centered around Taiwan and Ukraine/Belarus.

However, another possible threat as explanation is the fact that Covid Case numbers are now rising very sharply in Europe, especially in Eastern Europe.  Also, as BOOM explained last week, death numbers from ALL causes are rising steadily in Europe/UK in the younger age groups 14 – 75 years. Those death numbers are also higher than 2019 and 2020.

VACCINATED VERSUS UNVACCINATED:  Now let’s look at the death numbers of vaccinated versus unvaccinated. A recent analysis (published today) by Alex Berenson shows that vaccinated UK adults below age 60 are dying at twice the rate of the unvaccinated.

Berenson’s article contains a graph showing that the vaccinated death numbers crossed over the unvaccinated in April this year and have consistently been higher ever since. That chart is chilling for anyone who has been vaccinated with the experimental Covid vaccines that are still in Clinical Trial phase. The reality here is that the unvaccinated are now the Control Group because the original control groups in the trials run by Pfizer/Biontech, AstraZeneca in late 2020 were all vaccinated in early 2021. (That is another bizarre and disturbing fact).

It seems that everyone is suddenly waking up to the fact that the Covid Vaccines provide little to no long term protection after 4 – 6 months. And during that short time frame, the vaccines provide only 1 % (or less) of Absolute Risk Reduction against the virus.

And worse, we will all soon have to consider if the vaccines are the cause of the mysterious rise in deaths being observed in the UK and in Europe.

Vaccines that don’t work and that instead kill and maim are the ultimate nightmare for populations that have been coerced and mandated into taking the jabs. The violent protests seen in Rotterdam over the last few days may be the precursor of more to come as social unrest erupts.

It is looking more and more as if the politicians have sold us all a pup in the “vaccines will save us” argument. If so, confidence in the leadership of the western advanced economies is about to take a big plunge. Where will they hide if they become the hunted?

Alex Berenson Analysis: https://alexberenson.substack.com/p/vaccinated-english-adults-under-60

ENERGY PRICE COLLAPSE COMING?:  In general, BOOM likes Gail Tverberg’s macro analyses that she publishes at her website called Our Finite World. Gail’s usual approach is that financial system failure will lead to energy supply problems (not the other way around) and that such a sequence of events will subsequently cause lots of failure in other areas of the advanced economies.

BOOM agrees. Energy (both labor and heat dissipating) is inert until it is put to use and it must be put to use via a trusted financial (and political) system. The best example of this is to be found in Venezuela which has abundant energy, lots of labor and thus, theoretically, it should be an economy to marvel at. Instead, it is the opposite. Why? Because it has a financial and political system that none of its citizens trusts.

Excess energy is not enough to create a sustainable economy. Money creation, built on trust in the banking sector and which is not CPI inflationary and which does not lead to currency collapse is the Magic Formula of sustainability. Complex societal structures must be carefully put into place and nurtured for that to happen. Without that, all the energy in the world will not be put to effective use to build a long term successful economy.

A TRUSTED MONEY SYSTEM:  Our money creation system has evolved from 14th/15th century Venice — it involves the creation of credit money as bank loans (which require sufficient optimistic borrowers). That credit money should be in balance with sovereign money (cash) and that system essentially worked for 400 years until 2008 — the Global Financial Crisis.

Then we hit the reality of insufficient borrowers and insolvent commercial banks (especially in the US). Since then, we have adopted Quantitative Easing (QE) by our central banks that has funded the large and growing government deficit spending programs. The advanced economy Governments have dutifully spent that money and that funding has kept our economies functioning … but in a relative Zombie state. This can go on for a long time …. as long as sustained CPI inflation does not break out and as long as the currencies stay relatively stable in relation to each other.

The problem of QE lies in its methodology — the money flows are all mediated via the Bond markets which means that we have distortion in the pricing of Bonds. Asset Price Inflation is the result — and that is abundant now in the advanced western economies.

The answer is not to just stop QE — that would cause big problems. We need to change over to QB — Quantitative Boosting — as described by BOOM in numerous editorials. QB is a new form of money creation — very similar to QE but where the Bond market is not used as the conduit for the funds.

THE BOOM SOLUTION:  BOOM has considered all of these matters in many editorials as long term readers know. The best solution is to repair (and restore) the balance between Credit Money (money created as a bank loan and principally collateralized against pre-existing physical assets) and Sovereign Money (money created, interest free by the State and distributed directly into the real economy of goods and services provision).

In our modern world, that requires electronic cash created by the Treasury. This is where BOOM’s Quantitative Boosting (QB) solution comes to the rescue — a form of electronic money free of interest costs, in national currency and injected straight into the real economy (not via the asset markets). The long term aim is to move towards a 50:50 balanced money supply. At present, in the advanced economies Credit Money is 98% of the money supply and Cash is just 2%.

That ratio is at the very crux of the matter and until it is fixed, our financial system will generate more and more wealth just for the wealthy. The end result will be more social inequality, more social upheaval, political upheaval and distress. Ultimately, we will be back at the Gates of the Bastille and the guillotines will be erected for the wealthy.

QB Explained: https://boomfinanceandeconomics.wordpress.com/2019/12/15/boom-as-at-15th-december-2019/

In economics, things work until they don’t. Until next week …………  Make your own conclusions, do your own research.  BOOM does not offer investment advice.

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Author: Austrian Peter

Peter J. Underwood is a retired international accountant and qualified humanistic counsellor living in Bruton, UK, with his wife, Yvonne. He pursued a career as an entrepreneur and business consultant, having founded several successful businesses in the UK and South Africa His latest Substack blog describes the African concept of Ubuntu - a system of localised community support using a gift economy model.

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Just Sayin'
Just Sayin'

OK. Got a problem with the article. NOT ONCE was capital or savings mentioned. Are we beyond the era of those items mattering in the scheme of “sound money”?

Just Askin’ 🙂

Anonymous
Anonymous

“Everything works until it doesn’t” Too bad that when that moment comes it will be too late. The collapse and chaos will not abate until we hit rock bottom.

rhs jr
rhs jr

We’ve had mandated Genocide Shots for We The People (excess death rates are already about 20%) so Guillotines for the Wealthy are probably coming whether we have QE or QB; I’m sure they thought of that and have wonderful escape plans and locations already prepared for the 500 million Elite Oligarchs. PS: I can’t help seeing the MSM experts telling bald faced lies on TV when I watch like “70% of the hospital cases are the unvaxxed” and “youth are unusually hard hit especially children” bla bla bull shit. Why aren’t they reading the adverse reactions of The Shot at the end of ads like for other drugs? PSPS: I don’t buy Crypto because I don’t trust TPTB with the Internet Switch etc; I value farmland, physical gold/silver, canned food, ammo, fuel, water wells, livestock, seeds, Jesus, friends, tractor, etc. I trust Wall Street paper like I trust a hooker or a democrat politician.

TN Patriot
TN Patriot

I was with you until you added democrat to the politician label. Drop that one word and you are spot on.

rhs jr
rhs jr

Well you got me, I agree.

BL
BL

I knew when I saw them installing Bitcoin ATMs all over the place, they were getting ready to pluck some chickens….err suckers. If I knew we had a hyper on the horizon, I would invent something like bitcoin and let it become the pie in the sky valuation so the too many $$$$ would be channeled into that instrument. Then in increments I would vaporize those $$$$ out of the system to curb the hyper as a control valve. Works just as well with diverting $$$ into stocks.

Roger G Lewis (Tonefreqhz)

Hi Peter its been a long time.
Big Falls in Bitcoin and Crypto Markets — GEOPOLITICAL OR COVID? — Vaccinated Versus Unvaccinated — Energy Price Collapse Coming? — A Trusted Money System — The BOOM Solution
An interesting and timely blog.
The chicken and the egg, which comes first is perhaps harder to answer than how long is a piece of string.
Even if one has an egg or the chicken that’s still a hard question. The question regarding the Piece of string is answerable if the Piece of string is available for measurement against a Standardised Unit.

And on the Chicken and Egg we have here this point of difference.

“Gail’s usual approach is that financial system failure will lead to energy supply problems (not the other way around)”

After the Nixon Shock The Gold Standard was replaced by a De-facto

“Bi-oilism.”

The Petrodollar Standard, with Saudi oil production being a swing producer to facilitate inflation of the currency.
In January 2005, Saudi Arabia increased its number of operating rig count by 144%, to increase oil production by only 6.5%. This suggests that the market swing producer (as Saudi Arabia was seen) was not able increase production enough to meet increasing demand.

Plateau Oil. A variation on the idea of peak oil. AT Plateau production no swing capacity in Oil Supply is similar to demonetising Silver giving a de-facto Petrodollar Standard which is inherently deflationary.

QED, Welcome to the new Oil Shock.

Money its a Gas, used to be oil, but you still have your hands on my stash. Energy Economics. Banned from seeds. #WTF

“The long term aim is to move towards a 50:50 balanced money supply. At present, in the advanced economies Credit Money is 98% of the money supply and Cash is just 2%.

That ratio is at the very crux of the matter and until it is fixed, our financial system will generate more and more wealth just for the wealthy. The end result will be more social inequality, more social upheaval, political upheaval and distress. Ultimately, we will be back at the Gates of the Bastille and the guillotines will be erected for the wealthy.”

This the BOOM solution gets to the store of value versus means of exchange question inherent in the Bi-Metalism model and how demonetisation of Silver and the Inability of swing production to cover economic expansion explain why energy price rises really do come first, measurable like the piece of string not unanswerable like the chicken or the Egg.

Truth in intensive care. Eye See You. #ICU Busted Flushes and thread bare narratives . WMD’s to IOU’s #TheGreatBailin #OilBlackGold #InducedComa of a New Oil Shock #Bilderberg #OlofPalme

rhs jr
rhs jr

Sir, as a Physics teacher I’d say the length of a string is Relative but as an ex-Biology teacher speaking, eggs came millions of years before chickens. I also dare say that the first chicken came from an egg. If you think about it, so did the first Homo sapien. If anyone wants to bring the Bible and Genesis into this, I am a Christian but also prepared to lay a few hundred other science Biblical errors onto the table.

c1ue
c1ue

Re: Crypto – BOOM continues to demonstrate zero credibility.
Bitcoin and ethereum, much less the shitcoins, have had 20%+ drops multiple times this year.
Long term or even medium term – they’re going nowhere but ascribing a single instance of a 15% drop doesn’t mean squat given that bitcoin was 13K at this time last year and is $57K now.

ursel doran
ursel doran
Yahsure
Yahsure

Bitcoin is a long-term investment like Gold. Just bring up a chart and look at the long-term price from start to finish. Now find a Dollar chart and look at it long-term. Looking at Bitcoin short-term will just drive you nuts because it’s highly volatile.
In the future, a garden/greenhouse and chickens will be a better investment than Gold or Bitcoin. I recommend getting out of debt and having a paid-for place to live. It’s best if it’s a place on a lot somewhere off the beaten path away from cities.
Good luck to all of us with the decisions we make.

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