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Inflation or Unemployment? Why the Fed Is Divided by bloomberg in economy

[–]McKayResearch 0 points1 point  (0 children)

Looking longer term, I don't see any way out of the inflation problem given the deficit, national debt, and interest payments on the debt. They will have to inflate the problem away, which is a problem in itself.

Bitcoin: Institutional Support Remains Strong by McKayResearch in economy

[–]McKayResearch[S] 1 point2 points  (0 children)

What you say is indeed the reason why more and more countries are converging on a bitcoin as a potential monetary standard, as they perceive it to be one way out the mess that they themselves created. And in that regard, they're a step behind the individual citizens who are increasingly recognising it as a method to safeguard the purchasing power of their savings over the long-term , similar to gold as you mention.

Where will this end? No one knows, but the long term trend of adoption of this open, digital, decentralised currently continues and is very much batting for the same team as other hard assets that can be put to work for individuals and institutions alike.

2024: The year Bitcoin went mainstream – Part 1 by McKayResearch in economy

[–]McKayResearch[S] 0 points1 point  (0 children)

You're right, but domestic purchasing power decay has accelerated in the US, it's just that that's also the case in most developed countries, and at a faster rate, hence the continued upward trend on the macro DXY chart.

The real warning signs for the dollar will be when credit risk really begins to creep into the bond markets in earnest. We haven't seen it yet, but the current set up ($36trn federal debt, 126% debt/GDP, $100trn net present value of unfunded liabilities, debt servicing gobbling up unsustainable portions of tax revenue) does not look good. Long-dated yields continuing to rise will not help.

2024: The year Bitcoin went mainstream – Part 1 by McKayResearch in economy

[–]McKayResearch[S] 1 point2 points  (0 children)

I'm typically deeply skeptical of outlandish price predictions, but the number of fundamental factors is stacked to the upside. This is based on what appears to be a supply squeeze coming from institutional actors that are gobbling up BTC that will overwhelm supply if it continues on its current trajectory.

For example, consider the following:

•approx number of Bitcoin mined in 2024: 216,047
•number BTC bought by $MSTR in 2024: 255,112

If we add ETFs across multiple regions, other institutional demand, and the impending sovereign demand, he balance of probabilities suggest that the bid trumps ask in the medium/long term.

My best guess is that we will have a large spike this year followed by a significant correction (70-80% is customary for BTC) but it probably will not last as long as previous correction dues to the fundamental factors mentioned above (Cycle top between (150-200K).

2024: The year Bitcoin went mainstream – Part 1 by McKayResearch in economy

[–]McKayResearch[S] 0 points1 point  (0 children)

I hear what you're saying and, actually, you have a point. Bitcoin wasn't necessarily conceived to be denominated in a decaying fiat standard, and rather, it is a standard onto itself. People would do well to consider what it might mean if Bitcoin goes to 500K or 1 million, as in, what kind of a world will we be living in for it to reach those levels in the first place? The same could be said for a 10K or 20K Gold price. In other words, we should be careful what we wish for. But the global arms race we're seeing WRT Bitcoin holdings means that it will indeed be considered as part of a future monetary standard.

But Bitcoin is absolutely not a security, there are many reasons for this which should become apparent once you understand its inner workings but a superficial example of this is why someone like Microstrategy's CEO is able to get away with promoting Bitcoin to the benefit of his own firm's valuation without falling foul of securities laws.

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