People love talking about how crazy and unprecedented this period of history is, and granted, with everything in flux and zero certainties, we’re finding that much of what we thought to be true is starting to unravel. You see how autocratic governments are, you see how hollow corporations are, you see how fraudulent the financial system is, and even now, people are refusing to accept the truth.
The world is not technically descending into chaos. It’s only becoming more honest with itself; these issues were always there, the year 2020 just pulled back the curtain and exposed it for what it is, and it’s an ugly truth.
In a world where we have no safe bets, the stock market is a casino; the bond market has no yields. It needs to be propped up; the forex market is subject to massive currency pegging and manipulation, the commodities market is either being suppressed like in the case of gold or prompted up in the case of oil.
The fundamentals people teach you on valuing these items are out of wack simply because they measuring from a false baseline and false readings from fiat manipulation.
Money is power
As the old saying goes, but the reason it’s powerful is that it makes up 50% of ALL transactions, in some cases a 100% when you are trading fiat for fiat. There is no measuring stick for fiat money, and that’s why their so much confusion around economics and pricing. Since there’s no measuring stick we can trust, we accept fiat money as the measuring stick giving it the power.
Fiat money has been conflated with the idea of value when it is only a temporary promise of value; these two are not the same thing.
Search for consistency
In a world where the measuring stick keeps changing every day, you cannot get a feel for where you stand. For example, the US dollar can be going up against the Euro, but at the same time, they are both falling against the previous year’s value of the dollar or Euro.
When currencies don’t have a hard cap, it’s pretty hard to measure them and their value over time.
This is why Bitcoin and Gold is a great way to find truth in this swap of fiat money. Gold, as I mentioned, is for sure being manipulated and should be far higher in value in dollar terms than it is today, and the break out will happen eventually, but a lot of gold sits in the hands of governments and institutions; it’s heavily centralised in terms of distribution.
We also peg golds inflation at around 2%; Still, with miners not working or the possibility of finding new deposits, Gold does not have set inflation; there is still an element of uncertainty.
The Bitcoin certainty
As far as I can tell, Bitcoin is the only store of value with a fixed cap and fixed inflation; it doesn’t get more consistent than that. We can predict what it will be to the date, which is why I place so much trust in it.
The volatility of BTC comes in due to its distribution model, not its fundamentals. As each year the supply tightens as we reach the hard cap, we find that the probability of value increasing gets higher.
Bitcoin is by no means a sure bet, but if time and adoption are the only factors, then it’s as sure a bet into holding value and maintaining generational wealth then you’re ever going to find in your lifetime.