16th Oct 2019. Donald Trump is still the leader of the free world and we’re all incredibly depressed. The left and right are further apart then they’ve ever been. Populism is on the rise, and the elite are playing their final hand with no concern for the consequences.

But, times are a-changing.

Populism on the rise as the inequality gap widens. — Low-interest rates have offered rich people a cheap and easy way of building wealth, whilst costs rise for those at the bottom. The process of printing money and buying assets (quantitative easing) is creating an artificial feedback loop that is pumping the price of assets, making others richer — a loop that is engendering a wealth gap. On the flip side, costs of living are rising, not in tandem with the purchasing power of the mass — thus populism.

Sanctions on money being imposed — Capital controls in Hong Kong. Reminiscent of the capital controls in Cyprus back in 2013. Exacerbating tensions between the state and the people.

China imposing a new-world order — China is going toe-to-toe with the US in a trade war that is threatening to debilitate the fragile equity markets around the world. In the wider context, this serves as a fitting backdrop to the USD hegemony coming under threat.

World economy slowing down quicker than anticipated — US vs China trade war, Brexit and the deterioration of corporate profits has sliced the world GDP growth outlook by 27%. (From 4% to 2.9%)

$4trn about to vanish — With company profits slowing down, the ability to service debts is becoming difficult. There is $4trn worth of BBB bonds that are on the brink of being downgraded to junk once share prices take a tumble. All of these companies are owned by the pension system, the moment these BBB bonds get downgraded to junk, they will have to be dumped on the market as pension trustees cannot own junk bonds. The ‘junk’ market which is worth $1trn will not be able to handle $4trn worth of shares dumped. That’s why many are calling the upcoming crash as a beckoning liquidity crisis. (Listen to Raoul Pal’s talk on a recent podcast explaining this)

Banks are running out of cash, literally — So, for the first time since the financial crisis in 08, the Federal Reserve (Central bank of the US) has given banks an emergency source of funding as many banks have come up short when servicing their short-term debts to other banks. In late Sept, over $92bn in ‘repo’ funds were requested by US banks. What’s that quote about when the chickens come home to roost?

Fiat currency wars — China has been accused of devaluing the Yuan in order to make their exports more competitive. The leader of the United States has suggested that the US does the same. A weak dollar would give American exports a boost, thus a short-term bump up in share price for many US companies. Donald Trump's myopic approach encourages the devaluation of the US dollar in order for the stock market to surge. This bodes well for his chances of being re-elected. On the contrary, it doesn’t bode well for the dollars in your pocket.

Brexit a knockout blow for EU— The UK is on the verge of strategically weakening its GDP growth with unfavourable trade terms on the horizon in the name of sovereignty. Uncertainty is rife, and whilst we (the British) fear the worst, it’s becoming increasingly clear through the rise of nationalism in Europe that the EU’s days are numbered as it is. What say the €Euro?

We Work for Wall Street — Wall Street has been feeding Joe Public over-valued horseshit in the form of IPOs for years. This realization is finally coming to fruition with the recent calamity of the WeWork IPO. Wall St has been consciously duping investors by knowingly selling IPOs that are extremely over-valued. Don’t believe me? Read the headline below.

Y’hate to see it :)

Speculators are figuring it out — Gold broke out of 7-year consolidation range into a bull pattern. Events such as the ones above are being priced in with many speculators fearing the worst.

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To sum up:

Current global economic policies are making rich people richer, and poor people poorer. — Trust between government and people becoming jaded.

People have now had enough and are rioting all over the world. — People are looking for a change.

Capital controls are being imposed. — Circumvention of fiat currency sanctions is going to be explored.

World economy slowing down — This is a sign of the incoming collapse of the house of cards. Economical downturn on the horizon.

Liquidity crisis incoming — Equities and other risk-on markets are en-route to a serious deflationary bust.

Dollar and the EURO under threat — China is coming for the dollar, whilst the EU is imploding. The experiment of FIAT currency looks fragile.

Equities market over-valued. — There seems to be more notable signs that people are staying away from equities. Alternative assets to be explored?

Risk-off — Gold price action suggests that fear is starting to slowly be priced in.

With times of uncertainty, comes time for opportunity, and change. The people are waging their war against the world's elite, not just in the form of marching, but protesting with their money. For the first time in the digital era, there is a censorship-resistant currency that many people deem to be of value due to the characteristics below:

Decentralization

Free from currency manipulation

Scarce

Separate from the state (Sovereignty)

A programmable inflationary mechanism that becomes deflationary over-time.

Uncorrelated with traditional markets

If we are to consider that we are going through a period in our existence where populism is on the rise, relationships between the people and governments are severely jaded, nations devaluing their currencies in the name of currency wars, central banks printing money, making it even more worthless, the biggest stock market bubble ever, and slowing global economic growth. The notion that Bitcoin could be ‘safe-bet’ investment just seems to make more sense.

Let us leave the epiphanies of hindsight to those who weren’t curious enough to question — what if.

This is not investment advice.

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