Every law, every social norm, every civil liberty, every human right, every culture: the authority and longevity of socioeconomic order itself is shaped by the one true (meaning, free market selected) sovereignty system active in the world today—gold.
Gold remains the singular dominant money in the world. In the unregulated geopolitical sphere, nation-states go to war over it, fund war with it, and the victors write new laws.
Gold is the call option on all human creativity past and present, since it lays claim to all savings in society. Gold is absolute power.
All socioeconomic systems we think have power are really just derivatives of this ancient golden reservoir of sovereignty.
Even a law abiding citizen with no knowledge of this, nor any gold of his own, is still behaviorally shaped by legal and police systems—authorities rooted in state sovereignty, which is a derivative of that nation’s gold holdings, or its protection agreements with other nations.
Gold is the game humanity has been playing throughout history.
But what happens when a digital disruptor threatens to break this game?
#Bitcoin is history’s first and only sovereignty system competitive to gold. A genuine game changer in the grandest sense imaginable.
• • •
Missing some Tweet in this thread? You can try to
force a refresh
A quick thread walking through some of my latest piece "Our Most Brilliant Idea" where I explore the nature of ideas, their generative source, and (of course) #Bitcoin
Ideas are the origins of everything we say, do, or make. The purpose of any economy is to generate and share useful ideas through free trade (to achieve what economists call the division of labor or knowledge specialization).
Resultant knowledge encodes the patterns of action we use to etch our imaginations into the world around us. Winning ideas are chosen by the market, only to be widely distributed as material riches, finer manners and morals, and more profound art.
A deficit occurs when any organization—a family, a company, or a government—generates expenses that exceeds its revenues.
Most call this a "net loss," but for governments it is typically called a deficit.
But how can the US government continually spend more than it earns?
Simple: the US government can print more US dollars ("points" as she calls them) to cover its deficit.
US dollars (and all fiat currencies) are simply a claim on the savings of society—redemption certificates for the goods, services, and knowledge generated by productive people.
1/22. In the spirit of independence day weekend, I just published my latest writing: “Masters and Slaves of Money" where we explore why central banking is an institution of time-theft and #Bitcoin is a weapon for peace.
2. In 1776, the US declared its independence from England. For years, the decentralized state network resisted the implementation of a central bank, knowing the evils it had caused in eras past. Today with Bitcoin, people globally are declaring their independence from The Fed.
3. Money is a tool for trading human time. Central banks, the modern-era masters of money, wield this tool as a weapon to steal time and inflict wealth inequality. History shows us that the corruption of monetary systems leads to moral decay, social collapse, and slavery.
When fiat currency dies, conditions tend toward deflation first (since money becomes more valuable when uncertainty looms), before becoming increasingly inflationary and, finally, hyperinflationary. #Bitcoin was purpose-built for this.
A thread on my current macro view on USD:
Economic uncertainty is extremely high. Market participants are stashing dollars to self-insure against this uncertainty. Consumers are delaying discretionary and major purchases.
This behavior further constricts economic activity in a consumer-driven society, leading to more economic fallout, more uncertainty, and so on recursively. Policy responses are increasingly uncertain (so much so that the charts are broken temporarily):
Many people have asked me to share the notes from my appearance on the @APompliano podcast where we discussed "An Open Letter to @RayDalio re: #Bitcoin"
This thread is a distillation of those notes, let's begin⏬
Everything we say, do, or make starts out as an idea. The purpose of the world economy is to generate and share useful ideas through trade. As we trade, our ideas become better, giving everything we say, do, or make more specialized qualities
Consider how our transportation technologies have gone from wagons, to automobiles, to airplanes. In trade, everything is valued at some ratio of everything else. For instance, this car might be worth 132 chairs, or this house worth 11 cars.
@RayDalio recently published the second chapter in his series “The Changing World Order.” Chapter 2 is titled “Money, Credit, and Debt” and explains these concepts in some depth.
In this thread, we will go deeper on these explanations. Let’s dive in:
Ray starts: “All countries can print money to give to people to spend or to lend it out. However, not all money that governments print is of equal value.”
It is important to first realize, that all government currencies began as warehouse receipts for monetary metals.
Historically, monetary metals were the best technologies in terms of money’s five traits: divisibility, durability, portability, recognizability, and scarcity. Of these, gold was relatively the most scarce, and therefore it outcompeted others as the soundest store of value.