0/Debt drives our world. It permeates every financial interaction, sits at the heart of an entire global economy. It feeds on itself, on us & consumes without producing. We sit at the apex of 100+ yrs of a grand experiment. Our debt construct is fracturing. What's next?
1/The Fed’s fix is a commitment to a tsunami of debt. It’s going to break its 2% inflation mandate and aim higher. And in order to do so money printing will reach epic levels to combat global devaluation and long term technology driven deflation.
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2/The Federal Reserve does not want to make the “mistakes” of the Great Depression. In 2002 Ben Bernanke said: 
3/Bernanke believes the Fed’s reluctance to intervene in capital markets and suppress interest rates were the root cause of extending the Depression. However, a debt reset was long overdue. Private debt had exploded during the 1920s.
4/Each of the Fed’s actions since then have compounded fundamental errors in attempts to manage the economy. It is fixated on a mandate that defies 800 years of history. The Fed is determined to push the global economy beyond the precipice into a hyperinflationary end game.
5/Many argue there is no inflation. But prices have been skyrocketing since the inception of the Fed and modern central banking policies.
6/Private debt drives the fiat economy. US interest rates will remain near zero and likely enter negative territory in order to continue to “stimulate” consumer spending and drive the housing market. Indeed, 30 year mortgage rates are at record lows.
7/Artificially low rates will continue to fuel private debt. The Fed’s actions have forced consumers to flee cash (liquidity) and draw on future earnings to live today. This is in part reflected in private debt to GDP, which has remained high for decades.
8/Private debt as of Q1 2020 was 153% of GDP, returning to pre GFC 2006 levels. Over the next few years, near 0% interest rates and infinite QE will propel this higher to even more dangerous levels.
9/America is not alone. Global public debt has reach WW2 levels.
10/Global debt load is mind boggling.
11/Debt instruments need to be put to work. However, fractured supply chains and de-globablization have introduced barriers and uncertainty. Without an outlet, we’ll see local pockets of inflation. We are already seeing this interplay beginning to manifest in food prices.
12/Moreover, USTs are surging and central banks will need to absorb and monetize this debt load.
13/A Fed fueled “V” shaped recovery in the stock market is a hyperlocalized inflationary event on the order of trillions of dollars. It’s a testnet for the next wave of QE which will attempt to prop up asset valuations across the board.
14/The Fed and USG will “create jobs” by floating zombie corps and provide employee retention pay without any checks on productivity. It is highly like these programs will morph into canonical UBI.
15/In a few years we may find many “on the rolls” and monitored under the auspices of the government’s largesse. Yet printing paychecks has already met resistance. M2 money stock velocity has collapsed.
16/The Fed’s balance sheet will continue to grow at unprecedented levels driven by deeper capital market intervention. Price discovery & distortion will wreak havoc with the economy & savings. Retail investors will bet on anything. Bankrupt company stocks are mooning!
17/Positive recovery signals such as an increase in savings and rebounding consumer spending, soaring stocks are artificial signals induced not only by government benefits but by consumers forgoing paying rent, mortgages and bills.
18/There will be a false sense of security in part due to how the Fed & USG calculate CPI, inflation and capital ratios. These are manipulated metrics shifted to match a narrative and allow the Fed to expand its backstop facilities.
19/The Fed will have accomplished its primary task: grow debt. With interest rates near all time lows, consumers will forgo cash for cheap debt, risking the safety of savings then struggle when faced with protracted periods of sharp asset devaluation.
20/Indeed, the compulsion is so strong that not taking on debt and participating in the stock market or other non-cash assets may leave many far behind the artificial wealth curve, locked out of returns and future access to assets such as housing.
21/And so we arrive at the crux of the debt issue. Despite government debt exploding, it is private debt, the debt households and corporations carry that signals an impending crisis.
22/As it has been for nearly every modern economic crisis, it is expanding private debt. obfuscated by new debt instruments (CDOs, CLOs) that promise to reduce risk but instead obscure it, finally peaks, collapses and brings down entire economies.
23/The 2008 GFC was our most recent example but the dynamic has played itself out in every crisis since the 1980s. And each one was “muted” by an activist Federal Reserve delaying a much needed debt correction.
24/And it is no stretch of the imagination that private debt will continue to grow during this economic crisis. A low rate environment and Federal Reserve, intent on stimulating spending, will support banks to extend loans to the public at any cost.
25/For it is this private debt that is the engine of our fiat economic system and has been understood as its main driver since the formation of the first US central bank in the 1800s.
26/Coupled to public (federal) debt, US total debt is near 275% of GDP, an astounding figure. Unlike Japan, the US is a perpetual debtor nation & cannot sustain this debt load. Dollar demand forces the country to import goods and export its manufacturing base. US trade balance:
27/The Fed has no recourse but to stay the course. Unlike unforced errors of the Great Depression, the Fed will fumble & turn over the entire economy to debt, distorting it beyond recognition & ultimately crushing valuations and vaporizing savings yet again.
28/The tipping point is here. Moral hazard has been abandoned and infinite QE will drive debt higher and faster than ever before. As individual citizens, we have little recourse but to run away from cash/USDs and safeguard our hard work in other assets.
29/Yet, even these safe havens are subject to state control. Gold has been co-opted by the state. Stocks are overvalued and the market has abandoned all pretense of fundamentals. Real estate faces another 2008-like crisis.
30/The Fed has already telegraphed its next move. More printing to combat “deflation.”
31/That leaves little choice for most but to suffer through this crisis as all others past. One characterized by both inflation & deflation. One that drives deeper wedges between classes leading to all out class warfare.
32/It will ebb and suddenly surge and encompass nearly every facet of the economy and our lives. The economic stress will spill out into international affairs. Economic warfare will rage.
33/We have been living in the dark, the upside down, on the other side of the mirror, and fooled ourselves into believing inflation, debt, & fiat have driven innovation, human betterment and without them we would have fallen back into the Stone Age.
34/But look around. We are in an in a War for Wealth, people are fighting for morsels while entire nations organize against each other and their own people to strip them of their hard earned money.
35/We’ve allowed debt to define us and as such have become morally, socially and politically insolvent. Powerless, we watch as the Fed primes the printing press for another round of stimulus, another round of debasement, another round to accelerate the Cantillon effect.
36/Who gets the bounty? Cash and resource rich corporations. It is these de-facto states that hold state-like power and willingly accept the Fed’s largesse. For you? No. You are the workhorse.
37/With debt we lose choices, possibilities are limited, self determination muted, and we fall into the trap of a prescribed cycle of work, debt, service. We are severed from the very act of saving. And in turn are burning time borrowed from the future, today.
38/Yet for the few that understand, Bitcoin offers a chance out. In a debt filled world it stands out as the true essence of what money should be. Not just a tool for communicating value but one that carries and preserves work and time into the future.
39/Bitcoin enforces principled economic activity and allows one to escape the private debt trap. It creates a set of circumstances that leads to price deflation (not devaluation) and in concert with technological innovation, great individual rewards and freedom.
40/Bitcoin is the ultimate defunding program. It streamlines price discovery & allows markets to operate naturally. It relieves governments of the need to manipulate economies & opens the playing field to all. Bitcoin rectifies central banking fiat follies.
41/We’ve allowed debt to define us. No more. The next decade promises one of the largest macro economic shifts in history. It will fracture our current debt based construct and open the door for a new way to work, live and build our communities.
Fin/Money is civilization’s operating system. It's time to open source it. It's time for #bitcoin.
