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Issue #526: This should not be overlooked

Issue #526: This should not be overlooked

Jul 15, 2019
Marty's Ƀent

Issue #526: This should not be overlooked

On Friday morning, we briefly mentioned Federal Reserve Chairman Jerome Powell's comments on Bitcoin that were made during a hearing on Capitol Hill last week. However, we only touched on a soundbite during which Powell described Bitcoin as a store of value. A historic moment, no doubt, but only a sliver of the bigger picture that was laid out during the hearing.

If you go back and rewatch the game tape, as our friend StopAndDecrypt has recommended, you'll find that Chairman Powell was incredibly frank about the US Dollar's fallibility and vulnerabilities. A sobering display of humility and honesty that one is not accustomed to seeing from a mainstream economist, let alone the man sitting in one of the most powerful positions in the banking world.

In the snippet above, Powell tells Congress that a currency's status as the reserve currency of the world should not be assumed to last forever. Especially if the country that manages that currency does not have its fiscal house in order. The economy that backs the reserve currency needs to be able to "absorb and manage" inflows and outflows of capital. A country worried about future obligations may not be as nimble as it needs to be to maintain its status as the arbiter of the reserve currency of the world.

Individuals and countries may begin looking for alternatives that have "more attractive" features than the US military, the US financial system, and the US Constitution to protect it. Very valid points. And a seemingly impossible trifecta of excellence to overcome. Unless...

... there was a way to create better money with subversive features. Money that has spread like a virus, replicating its hard-line-freedom-enabling policy on computers around the world, drawing insane amounts of disparately located energy to protect it, and an insane amount of mindshare to make it as efficient as possible. Money that lives on the Internet and cannot be directly confronted by men with guns without coordinated effort and cooperation by all the world's leaders. One that anyone can protect the integrity of on a USB drive. A money like Bitcoin.

Chairman Powell's comments are a sobering reminder to US citizens and the rest of the world that dominance has been temporary throughout history and it is destined to fade as complacency rises. To me, these comments come off as a subliminal alert to Jerome's fellow citizens; this party may not last forever and he can hear faint melodies as the fat lady begins to warm up in the corner.

The question that remains is, what will fill the vacuum when she finally takes the stage?

Final thought...

Only took two base burns to get my tan on point this Summer.


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