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The prices no longer reflect the “Collective wisdom” ” investors “. The invisible hand magically adjusting all the parameters of this world to achieve the permanent optimum is a decoy. The “marchesis“Efficient” is a myth as convenient as it is hypnotizing, but the truth is that central bankers orchestrate everything. The high priest of American monetary policy, Mr. Price, the commander of inflation, is named Jerome Powell. The president of the FED recently had some highly interesting comments for bitcoiners.
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2 %…
For those who don’t know, central banks have a big mission: keep inflation close to but below 2%. Why 2 % ? Why not 1 % or 3 % ? You will find the explanations of the ECB here. We can read :
“The inflation target of 2% offers an adequate margin to reduce the risk of deflation (falling prices). “
ECB
Anyone will automatically ask themselves this question: Why is the ECB afraid of falling prices? Wasn’t that the promise of “progress” than being able to enjoy more things? What is the purpose of productivity gains, automation and technological advances if not to be able to enjoy more working time equal? …
The truth is elsewhere … The ECB fears the deflation because who says lower prices says decrease in VAT revenues for states. If prices go down, VAT revenues go down too. It then becomes much more difficult to repay the public debt because VAT is by far the most primary source of state revenue (200 billion in France).
It would not be a problem at all if states had not agreed to become prisoners of the debt by rolling it against interests. Because never forget it, central banks are the guardians of a loan shark system that we could quite replace with another. But you won’t read that in Les Échos or Le Figaro Économie …
The ECB is targeting 2% to facilitate debt repayment by states and above all because inflation is inherent in the system of slavery of money creation from debt and interest ! This system needs the overall debt to constantly increase in order to function.
The main reason for this debt bulimia is that 100% of the existing money is constantly being reimbursed. Not to mention the interest that does not exist at the time of borrowing. The way we create money condemns us to always lend more than the day before. Global debt MUST increase.
I insist, without a regular turnover of new loans that are larger than the old ones, the amount of money in circulation can only dry up. It’s the recession, the “ credit crunch “. It is vital that each generation takes on more debt than the previous generation to keep the system going. This is the very definition of a Ponzi which will probably end when oil production begins to decline irreparably …
All this to say that if the debt increases, it means that the amount of money in circulation increases. Which, all other things being equal, causes inflation. Thus, it is the OBLIGATION to inflate the overall debt that makes Central Banks say that their mission is to generate 2%. But they will never present it to you that way …
2% is not a “room for maneuver” but an inevitable consequence of our modern monetary system.
Jerome Powell
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Now that we have revealed why central banks have given themselves the sole mandate of keeping inflation close to 2%, let’s take a look back at last week’s event: the speech of Jerome Powell, the helmsman of the FED.
The latter announced that the Fed will no longer target inflation strictly below 2% but rather a 2% “average” inflation. The FED no longer targets 2% annual inflation but 2% on average over a longer period. What period exactly? We do not know it…
“In seeking to achieve an average inflation of 2% over time, we are not tying ourselves to a particular mathematical formula that defines the average. “
Powell
In other words, the FED intends to let inflation slip away so practical to reduce the debt burden slaver by robbing everyone’s purchasing power …
Indeed, wages tend to stagnate and not increase as fast as general price inflation. Wage inflation is almost non-existent, especially when we calculate the global average by including all those who are unemployed … Rather than good inflation (wage increase), the FED is especially strong to cause inflation of shares of purses of which more than 50% belong to the richest 1% of the United States.
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Cryptoassets are highly volatile unregulated investment products. No EU investor protection. Your capital is at risk.
Here is the time it takes for this or that rate of inflation to destroy half of the purchasing power of money:
1% – 70 years
2% – 35 years
3% – 24 years
5% – 14 years
8% – 9 years
15% – 5 years
25% – 3 years
50% – 2 years
Now you should know that technological advances and the concomitant productivity gains (a farmer working with a tractor for example), according to some estimates, lower prices between 5% and 10% per year …
In other words, the fall in prices linked to technological progress, the increase in the consumption of free energy and the relocation to slave countries, hide the real inflation inherent in the overflowing monetary creation..
So I let you imagine what the real ambient inflation is. We can get an idea by looking at the monetary aggregate M3 which is a good representation of the amount of currency in circulation. We are at 9 % per year in the euro zone…
In other words, if the banks did not always lend more money, in particular to giants like wallmart or Amazon (which destroy small businesses), we should see our purchasing power increase by 5-10 % per year…
This is the future we were promised thanks to automation and which we will never see because of inflation (swelling debt) and the peak oil that we have potentially already spent. Peak conventional oil was crossed in 2008 at 68 million barrels per day, and has since declined by just over 2.5 million barrels per day.
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Jackson Hole
Jerome Powell’s statements remained vague. Over how many years will this “average” be calculated? Difficult to get an idea without this key figure. It is to be feared that the FED will never communicate this in order to give itself free rein to reduce the burden of the debt through inflation. And we’re not talking about wage inflation here …
It is not a myth that the population of advanced countries is getting poorer. The following graph shows that the real wages (wages minus inflation) in the United States have stagnated since the 1970s even as productivity has continued to rise.
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We always produce more for the same labor time but we do not see the color of our labor. The fruits of our labor are siphoned off by shareholders of multinationals and banks that run the printing machine shameless.
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Central Banks, as rightly written Satoshi Nakamoto, are not trustworthy:
“The fundamental problem with traditional money is all the confidence it takes to make it work. You have to trust the central bank not to degrade the currency, but the history of fiat currencies shows that this trust has been repeatedly violated. […] They lend it (money) in waves of credit bubbles with barely a fraction in reserve. »
Satoshi Nakamoto
Let it be said, the FED has just launched a perpetual monetary easing and intends to do away with the debt with the purchasing power of global savings. Yes, savings global, car 60% of central banks’ foreign exchange reserves are in the form of dollars and therefore treasuries (US government debt).
The petrodollar (the fact that oil can only be bought in dollars) keeps the whole world hostage. The FED will wipe out the country’s debt by robbing the rest of the world. The dollar reserves will make it possible to buy fewer and fewer iPhones and Teslas. It is for this reason that many central banks have started to buy l’or lately.
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Cryptoassets are highly volatile unregulated investment products. No EU investor protection. Your capital is at risk.
The Fed’s admissions are likely to accelerate this trend, which bodes very well for safe-haven stocks like Bitcoin. Its fixed money supply (21 million) makes it a formidable protection against inflation. Don’t wait any longer, it’s time to create your wallet.
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Child of Satoshi, the alchemist who turned a cryptographic algorithm into gold.
I’m talking about monetary geopolitics, not shitcoins.
Twitter: @cryptojournalFr
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