After Whirlybird Janet’s “ding dong, the Fed is dead” speech 2½ weeks ago, I predicted the “final currency war” I first warned of 4½ years ago would be taken to Defcon 1 – as all Central banks aggressively respond to the America’s increasingly inflationary monetary policy; particularly, after its “low interest rate person” President installs Yellen’s replacement early next year. And lo and behold, last night’s Royal Bank of Australia policy statement “warned” that a stronger Aussie dollar would “contribute to subdued price pressures”; as it was “weighing on the outlook for output and employment”; which in turn, would “result in a slower pick-up in economic activity and inflation than currently forecast.” In other words, its GAME ON in the global race to debase; simultaneous with, care of the gold Cartel, the lowest-ever inflation adjusted Precious Metal prices; and plunging gold and silver production, as Steve St. Angelo pointed out last night – of how Chilean silver production is down a stunning 32% year-over-year.
Irrespective, the dollar continues to plunge to lows last seen more than a year ago; as now that the “reserve currency” issuer has made it clear that additional rate hikes aren’t happening; and likely, any hope of a balance sheet “exit strategy”; essentially nothing the administrators of “lesser fiat toilet papers” say or do matters. Which is why it was so irritating watching PM’s yesterday, amidst maniacal Cartel capping featuring the time-honored DLITG, or “don’t let it turn green” algorithm. And thus, why Precious Metal holders (like myself) become increasingly angry with each passing day; not just for the financial damage done to us personally, but the political, economic, and social damage incurred on the “99%,” for the benefit of the 1%. Which is why, per today’s second follow-up to May 2016’s “Precious Metals and Bitcoin – Twin Destroyers of the Fiat Regime,” I am so excited about the dramatic, generational impact of crypto-currency.
On the eve of this extremely important challenge for Bitcoin – i.e., the “Bitcoin Cash” hard fork that is anticipated to occur less than an hour from now, at 8:20 AM EST (ironically, the same time as the COMEX open) – I attended the Denver Bitcoin Society meetup, where I was honored to kick off the meeting with a few words. Which were, that in my role as Marketing Director of one of the nation’s oldest, most trusted bullion dealers, I am proud to be the biggest Bitcoin advocate in the Precious Metal community. The reason being, that Bitcoin’s technology is so powerful, it may well serve as the “straw” that finally broke the “camel’s back” of fiat currency. Which, as you might imagine, drew a rousing round of applause; given how, like Precious Metal advocates, the principal reason Bitcoiners “hoddle” (i.e. hold) Bitcoin is its perceived ability to serve as a gold-like store of value.
Yes, on the same day “BIP 148,” or the “User Activated Soft Fork” symbolically activated – i.e., the people’s response to “big blockers”’ attempt to commandeer the network; Bitcoin Cash’s success – or more likely, failure – will in many ways, determine the pace of adoption of the real Bitcoin. If “BCC” fails to gain traction, as I anticipate, next week’s SegWit, or Segregated Witness protocol upgrade of the real Bitcoin will likely serve as a major positive catalyst for the sound money movement – as discussed in last week’s “Bitcoin SegWit activation – the gold Cartel’s worst nightmare.” As whether Bitcoin becomes the world’s day-to-day, utilitarian currency of choice, the trend toward decentralization as the future of monetary value will dramatically accelerate.
As I wrote in December’s “why Bitcoin will make gold and silver go up,” I (more than ever) believe the monetary disruption Bitcoin is capable of – potentially, NOW – could be so powerful, it will cause governments to refocus their manipulative efforts – from the “barbaric relics” gold and silver, to the “newfangled technology” Bitcoin. Which, at a time when Precious Metal supply is already historically low; whilst money printing is primed for another, potentially hyper-inflationary leg higher; may well hasten the end of an increasingly “unnecessary” gold Cartel.
As, if Precious Metals’ inevitable surge is caused NOT by a catastrophic monetary event; but instead, a diversion of the powers that be’s’ attention by Bitcoin; gold and silver holders may well get to enjoy the financial windfall they’ve been waiting so long for. Potentially, in an environment NOT characterized by economic and/or monetary disaster. In other words, gold and silver could potentially rise five, ten, or even 20x in the “modern monetary world” due to “repricing” in a Cartel-deficient market – without catalyzing the draconian government responses that have always loomed over the sector like a sword of Damocles. In other words, for the first time in generations, it will be acceptable to view Precious Metals as investment opportunities” – as opposed to age-old propaganda that they are only to be considered insurance against monetary cataclysm.
In fact, my good friend – and fellow sound money champion – Mike Krieger penned a fantastic article last night, “the scaling debate highlights several differences between Bitcoin and gold” – which in many ways, mirrors mine of last week”; i.e., the “co-existence of scarcity assets.” In both cases, highlighting how Precious Metals and Bitcoin are fighting the same fight – with “use cases” that have as much in common as they don’t. In Bitcoin’s case, it’s store of value property is still a work in progress, that could take many years to solidify – whilst gold (and silver) have proven their worth over hundreds of generations; and undoubtedly, will do so for hundreds more. As for day-to-day utility, Bitcoin clearly has the upper hand. However, as I wrote in “is gold money? who cares?” three years ago, there is no way governments will ever be trusted to administer monetary regimes once today’s largest, most destructive fiat Ponzi is destroyed; and certainly not a “gold standard,” given that a) they have abused and destroyed every previous gold standard; and b) they have no more gold! Thus, the opening for a decentralized, borderless “currency” like Bitcoin; whilst Precious Metals continue to do what they do have always done best; i.e., just sit there – “inert, immune, and immutable.”
As for today, sit back and watch the fireworks as the “Bitcoin Cash” hard fork occurs – in literally three minutes, given that I’m finishing this article at 8:17 AM EST. When the dust settles, I expect Bitcoin to be more powerful than ever – which in turn, will turbo-charge the attack of the “twin destroyers” on the rapidly dying fiat regime.
P.S. As I was about to hit send, WOW – June personal income, which will impact the upcoming 2Q GDP revisions, came in at ZERO, compared to the consensus for an 0.4% increase. Yes, 2.6% GDP “growth” indeed!