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Lyn Alden Profile picture
@LynAldenContact
Jan 26, 2022 • 5 tweets • 2 min read • Read on X
Consumer spending is 69% of the US economy, up from under 60% decades ago. Image
Meanwhile, consumer sentiment is very low. It collapsed during the initial pandemic, then bounced, and rolled over to new lows. Image
The PMI is rolling over, and junk bond yields are starting to go up. Image
Unlike the prior tightening cycle, the Fed will be attempting this tightening cycle with economic deceleration and low consumer sentiment from the start.

People don't want inflation. Well, one way to reduce inflation is to kill demand. People don't want that either.

¯\_(ツ)_/¯
The US runs a structural trade deficit, so unlike for example China, we can't really boost GDP by focusing on exports. If US consumption stagnates, US GDP likely stagnates too. Image

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More from @LynAldenContact

Lyn Alden Profile picture
Dec 12, 2023
CPI for November came in this morning. Headline numbers continue to bounce around above 3%, while core continues to gradually decrease. 🧵
Image
Image
Some people assume that the end of inflation means prices go down, but instead it just means the rate of change of prices decreases to the target rate.

There's permanently more money in the system, and prices in aggregate are permanently higher. Image
Currently, China has weak domestic consumption but strong production/exports, the United States has decent consumption but weak production, and Europe's domestic consumption *and* production are weak.

This weakness weighs on energy prices and other materials.
Read 4 tweets
Lyn Alden Profile picture
Dec 9, 2023
Since the start of 2020, the United States has taken on $10.7 trillion in new public debt (i.e. accumulated deficits).

That's about $80k per household in four years.

Has your household received that much in deficit spending? Some did, but likely not yours. Image
Some households received hundreds of thousands or even millions in stimulus.

And a sizable chunk of them were wealthy law firm or investment firm owners, or and various rather large business owners (100s of employees) that were not even disrupted by the pandemic/lockdowns. Image
Some households received indirect deficit expenditure. For example, if your employer received it, it may have positively affected your job.

But most analysis (e.g. see above tweet) showed that most of the money didn't go to that. It instead pooled near the top.
Read 6 tweets
Lyn Alden Profile picture
Dec 7, 2023
Four monies, personified:

-The Golden Monarch
-Lord "Uncle" Sam
-The Dragon Emperor
-Archmage Nakamoto
🧵 Image
The Golden Monarch economically defeated all opposition and reigned supreme for thousands of years. Now ancient and wise, and having seen the entirety of history, he contemplates his diminishing role in the modern world and wonders if he could have done anything differently. Image
Lord Sam, usurper of gold, known merely as “the Uncle” to many, sits at the Cantillon Source and wields the mighty dollar. Liberating in his youth, now oppressive in his age. His monetary power reigns supreme but shows increasing signs of decadence, decay, and defiance. Image
Read 6 tweets
Lyn Alden Profile picture
Dec 6, 2023
Often I see people assume that with full-reserve banking, there would be no credit.

But full-reserve banking just means that loans are funded by time deposits rather than demand deposits. In other words, there is duration-matching between assets and liabilities. 🧵
In that arrangement, bank customers that need to be able to access their money on demand, get full-reserve liquidity.

Customers that want to earn a yield with risk can put some money into time deposits, which the bank can use to make loans of similar duration or less.
With fractional-reserve banking (which all countries do today), there is a duration mismatch which can lead to liquidity problems.

Demand depositors are told they can withdraw at any time in banking hours, and yet most of their money is loaned out in illiquid loans/securities.
Read 5 tweets
Lyn Alden Profile picture
Oct 24, 2023
The #Bitcoin side of my feed has tremendous comment liquidity- I write something about it and get an *immediate* response by the hundreds or more.

Bear/Bull- I haven't seen this in years. It's different than sentiment; it's volume. Comment numbers, broadly.

Here's a thread. 🧵
Yes, I'm structurally bullish.

No, I don't know what it will do in the next six months.

Yes, institutions increasingly understand this more than you do. If you've not followed this in detail, you're going to follow eventually.

Chart via @PositiveCrypto Image
Bitcoin is the leading digital money. As information began coalescing online, eventually value did too, but it took longer.

The internet browser was created in 1994. Bitcoin was launched in 2009.

Bitcoin is half as old as the browser now, and it keeps growing in adoption.
Read 9 tweets
Lyn Alden Profile picture
Oct 22, 2023
The fact that Satoshi:

1) published the Bitcoin white paper before he launched it,
2) kept it on track for 2 years with upgrades,
3) disappeared without ever spending his own coins for profit, and
4) had such skill that people can't prove his identity,

is... remarkable.
Literally the Batman vs Bruce Wayne comparison is the only good one here.

Even if Satoshi is the NSA, people should have evidenced it by now.

A man can be killed, embarrassed, or shown to be weak.

An idea lives on and becomes a legend or a god. It's his material that matters.
And Bitcoin was built as an open source decentralized project to survive regardless of who the creator was.

The departure and the absence of the creator only made it *more* decentralized since it removed any sort of ultimate authority, and it iterated from there.
Read 5 tweets

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