We all know this is a crooked @$$ monetary system. Nothing went wrong – the abuses are built into the system. Modern fiat currency may be the worst kind of money, right next to company scrip.
The interest payments on US government debt will reach or exceed $1 trillion this year. You should understand by now that Modern Monetary Theory (MMT) means that governments can and will create money without end.
Said differently, with MMT – governments took total control over the nature of money. As Alan Greenspan points out, the real worry with MMT is inflation, which we think is inevitable with the current monetary system.
Whoever Satoshi Nakamoto is, they must have seen this coming.
The prime issue now is that Bitcoin, which we love, has become the leading force in decentralized financial systems. Bitcoin is likely the most successful proof-of-concept in human technology. But it shouldn’t be the last word in decentralized monetary systems.
Power is Money
The nature of money changed in the 20th century.
When 1900 hit – money was metal. A government could dictate the measure of gold or silver that created a currency unit (dollar, mark, franc, etc…) but the base of value was metal. By 2000, money’s value no longer had any base in the physical world.
So what happened?
One word – hegemony.
Two world wars created global hegemony for the first time in human history. With that level of power came a new kind of money. Now, that hegemony is falling apart. The 20th century mind wants to see our present state as the evolution of a new hegemon – China.
It isn’t happening kids. We are staring into the abyss.
Too Much History!
There is a reason why many see Bitcoin as “digital gold”. But it may not be exactly what you think.
People need an idea of value. That was the whole point of using metals as money. There was no central authority that could issue money without end (although failing governments did debase gold and silver with cheaper metals – the cads).
As Greenspan pointed out – as soon as there is inflation – people will look for another currency to flee into. He is right of course, which is why so many people in Argentina still use US dollars.
In our modern world, there is no good currency. They are all fiat currencies, and many are controlled outright. Big money loves China, but the Yuan is a garbage currency. No one wants it – not even the Chinese.
So when inflation really gets hot (mid-2026) people are going to look for other options.
Looking your way cryptos…
The Existential Issue
The US dollar isn’t going down alone. The idea that somehow the US dollar is going to zero while the Chinese Yuan rips higher is totally absurd. Fiat currency – as such – will die in a global inflationary firestorm.
Take the current Japanese Yen issues as an example of what is to come.
For some reason, the Japanese Yen fell to levels not seen in a generation. Some people say that it was orchestrated by Western central banks. Maybe it was done to antagonize China. Who knows…
The takeaway is that to solve a problem with fiat currency, more money is needed. MMT at its finest. With absolutely no base in physical reality, central banks and governments can create limitless money, and apparently address any problem that comes along.
Except inflation!
Tricky backdoor deals may help Japan drive down the Yen – but reliquefying global markets with potentially trillions (we don’t know how big the hole is) of USD will be inflationary. Japan may win in the short term as the Yen rises, but it will have to deal with the same structural inflation that every other country will contend with going forward.
Fiat currency is a trap.
Wall St. And Crypto?
The banking cartel is a strange animal. While it backs (OWNS!) the Western financial system, the banking cartel seems to be interested in Bitcoin. Ethereum too. The SEC went slow with the BTC ETF, but as the political winds in the USA shift, more crypto ETFs are likely to come to market.
Here is a theory – cryptos are the lifeboat for the Western financial system.
Wall St. knew it was all over in 2008. The cartel also knew there was no where to run. So instead of letting the system unwind, it created Bitcoin via its contacts in the US government (who has amazing cryptography).
Now, Bitcoin is hot – and investors love the BTC ETFs. It’s no secret that as Bitcoin goes, so goes the crypto market. By buying up large amounts of Bitcoin via the ETFs, the custodians have a huge amount of sway over how the crypto complex trades vis a vis fiat currency.
In other words, with a large amount of control over both the Western financial system, and cryptos, the banking cartel can manage the collapse of fiat currency – and preserve value by owning whatever tokens they deem worthy.
Just don’t ask us to prove it!
Whatever is happening with Bitcoin adoption, it is changing the way people see money.
It looks like an ETH ETF is going to drop on US markets soon – which could open the door to more crypto ETFs. We know Wall St. isn’t about decentralized solutions – so don’t get sooooo excited about the massive crypto rally that will hit in H2 2024.
Wall St. and the banking cartel have plans for crypto – and if recent history is any guide – they aren’t going to benefit the poor masses that need a reliable monetary system the most.
The post Op-Ed: Modern Money is a Byproduct of Power – Bitcoin is a Byproduct of Change appeared first on Blockonomi.
