Is BTC a hedge for inflation? Debt notes aren't moving much!
The black line in this chart represents inflation. 2001 and 2009 there was massive dilution of the money supply. However this is no where near what we have seen with the latest money printing. Inflation means assets shoot into the sky. Quick fixes do not repair fundamental problems within the economy. Unfortunately the money creation is not finding itself into the economy. Not only that but one $1 USD today is not $1 USD of yester year.
'Transitory' inflation is what we are being told by Central Banks. To be frank they are liars. Rarely if ever do we see prices drop.
Money is not FIAT Debt notes. When you buy something from someone you are giving them something that is basically an I owe You! Confused? Well it's meant to be confusing. They do not teach this in school because it's just too inconvenient to tell the truth.
'Money' creation is really debt creation. Want a loan? That 'money' is created out of thin air. Currently the government is generating these IOU's and giving them to the bank to lend out more IOU's. Debt is slavery, but some view debt enriching yourself. it is true that you can borrow to make more debt notes for yourself. You can buy assets with borrowed debt; which then can generate you new debt notes to acquire more assets. Assets are something 'REAL'. Whether a digital asset such as BTC or physical asset such as real-estate or physical metals. In short, I like assets especially the ones that go up in price.
Debt creation fuels this economy.
Sure we had transitory lumber inflation, and even oil inflation. The question is this, do you believe the USD will go up in value over time or down? Ok, some commodities during the latest 'crisis' have been inflated. However our supply chains have been disrupted and the cost of goods are still going up. Governments WANT higher inflation because the interest on their own debt has gone up substantially. It's a hidden tax where your goods go up in price and therefore taxed at the 'same' rate but at higher prices. As an example an apple may cost 0.50 cents and taxed at a certain rate. Once the price of that apple rises 0.10 cents more, the cost of a 0.60 cent apple will create higher tax revenue even at the the same tax rate.
If you want to exit BTC that's fine. Even with a strengthening dollar because people are not 'borrowing' enough, doesn't mean the long term USD price will go up.
Just remember this chart is like two decades of trading the S&P 500. Buying into support right now may be a great dollar cost average for BTC. Obviously this could break down back to 20k-10k. If you are a short term trader, you could easily get rekted.
Just ask yourself the question, when have prices dropped over the long term? There will be no 'easing'. Prices may drop slightly, but the government cannot taper their purchases. Banks may be over-flowing with 'cash' that cannot be lent out as much, but the easy money will continue and be funneled wherever it can go to prop up a failing system. BTC is a position that the money will flow into more fixed assets.
Posted Using LeoFinance Beta
