BTC#19: ARE WE AT THE ALTER OF CURRENCY COLLAPSE?

Going forward over the next 3-5 years, I still expect many currencies including the dollar to continue to devalue vs hard assets (BTC), and for the dollar to probably be among the weaker major currencies during that timeframe.  

I just finished my Q & A for members and laid out the case for the super cycle coming in the next few months.  I know this was complex but the video above is a parody of what I told my tribe.  Many people are not ready for what is coming.  It is coming faster than the market and the public expect and the market is calling the bluff of Central Bankers world wide.  

As the ten yield yield rises  the Central Bank has one card to play.  They will have to peg the short term bonds yield to stop the rising cost of government.  In this environment commodity prices are going to spike.  Growth Stocks will decline, and the currency will be under attack and the it will end in a devaluation.  

We may be at the beginning of that edge right now.  

Assets like Bitcoin in this environment will act like a basket ball underwater.  The rapid rising of the ten year bond yield pushed Bitcoin down 30% but that fall is exogenous to the halving cycle.  This means there is a huge potential energy bounce coming soon.  

Eating Our Own Cooking = the collapse of fiat is real

The market has responded to the Central Bank actions and will force it to make a decision.  The Fed is creating debt and now buying its own debt.  Since Central banks are the biggest buyer in the market they can control price.  They can surpress yields and if they fail, they can revert back to 1942-1951and put a permanent peg on the short end of the yield curve to make financing the government bills cheaper.  The Treasury did this to pay for the WW2.  The tradeoff here is that it destroys your currency.  In 1950 the US had no debt so doing this had only one bad outcome:  High inflation that would slow the economy.  At the end of Truman second term his efforts were destroyed by the Fed's peg rate.  

With today's debt rates the risk is complete hyperinfation and eventual currency devaluation in rapid fashion.  I believe we are at that edge right now.  

Based on the action of the VIX I believe most of Wall Street is unaware how close to the edge we really right now.  

As bond yields in the 10 year go higher government funding cost become explosive and they lose control of the balance sheet rapidly.  If the Fed pegs bond rates scarce assets will soar high.  Example is below.  

The choice of the Fed will make is going to play out by summer.   Congress is adding fuel to this fire by passing a 1.9 Trillion stimulus bill that has no COVID relief.  This money printing will push the dollar lower.  I see the perfect storm brewing.  

If the currencies collapses you can bet BTC will go up in parabolic fashion.  

I hope you are all ready for this reality during the Ides of March.