When illegally Nixon abandoned the Gold Standard in 1971, by reneging on 1944’s Bretton Woods Agreement, it unleashed a global explosion in debt that reached the peak of its fraudulent “prosperity” at the turn of the century…and permanently broke during the 2008 Financial Crisis.
After which, Central banks commandeered financial markets and destroyed them further – yielding the mess we have today, featuring all-time high, parabolically rising debt; record inflation - albeit, masked by fraudulent economic statistics; record low nominal rates - care of bond monetization and, in Europe and Japan, Negative Interest Rate Policy; record wealth inequality; and plunging “Emerging Market” currencies, where the vast majority of the world’s population lives.
With interest rates starting to push their way up - finally adhering to the laws of Economic Mother Nature - something financially wicked this way comes. Be it financial basket cases like Italy, historically overpriced housing markets, or collapsing currencies, SOMETHING has got to give soon…
…especially if interest rates aren’t gotten under control quickly – via increased monetization and/or borderline hyperinflationary monetary policies. To wit, nearly six years ago, I wrote of how the U.S. economy would implode if the Fed allowed the benchmark 10-year yield to rise above 3.0%...and finally it has, yielding plunging economic data, exploding budget deficits, and a rapidly weakening housing market.
https://www.milesfranklin.com/3-0-nuff-said/
Since the policies of the “reserve currency” issuer are exported worldwide, it will only yield increased fiat currency inflation in the first, second, and third worlds – which at some point, will translate to heightened inflationary fears…and thus, the desire to own inflation hedges.
Even Max Keiser, until recently one of the biggest gold bulls, realizes gold is no longer working…trading at all-time inflation adjusted lows, amidst all-time high monetary inflation. Thus, only one alternative remains…the most perfect, and DEFLATIONARY, monetary asset ever created, by man or Mother Nature.
That would be Bitcoin – which is just starting to be noticed as it approaches its 10-year anniversary, having traded above the institutional “Hoffman Line,” of a $100 billion market cap, for nearly a year. Something’s gotta give soon – and when it does, Bitcoin…and cryptocurrency in general…will be by far, the biggest beneficiary.
I still find it difficult to believe that in the current world of the 'Everything Bubble' that you have lost complete faith in the only assets that haven't gone up, yet have been the only true store of wealth for thousands of years. I miss 'Old Andy' but I like 'New Andy'.
Human institution can cough up blood for quite a while before their demise. It will take a big shock to the collective system before people awake to realize they need something a new system of money.