Notably, the long-term debt cycle coincides with the 4th turnings.

I mainly focus on what's happening quantitatively (debt). But keeping in mind the changing social/geopolitical dynamic is a nice accompaniment to that. Old institutions/norms facing entropy, death, rebirth.
🧵

https://twitter.com/LynAldenContact/status/1933333089947922707

Published in 1997, The Fourth Turning spoke of 80-100 year cycles of history, with each fourth one being a "crisis" period.

It predicted 2005-2025+ would be the next 4th turning era. Where old institutions get restructured, social norms rapidly shift, and so forth.

For context, out of China's total exports in a given year, the US buys like 10-15% of them.

Many people don't seem to appreciate this. China exports: $3.5 trillion per year
US imports from China: ~$500 billion

I've got my fluctuating list of top-5 or top-10 of financial/macro interviewers, and there are many great ones out there.

But the unchanging #1 of that list for several years now has been @JackFarley96.

How do I rank this? By the % of their interviews I actually listen to.
🧵 I'm a case where I'm both a consumer of financial media, and an interviewee in financial media.

As a consumer, I want an interviewer to seek out great guests, research them thoroughly, and ask the right questions.

That's not always the most sensationalist viewcount stuff.

Here's a thread about social media decentralization.

A couple years ago, I tried to "like" one of Doomberg's posts about a platform, and I literally saw the heart fill up, and then drain out of it like blood. I'd never seen that before.

Twitter said me liking that was disabled: Then, when I tried to search on Twitter for that certain platform that apparently can't be named, the search results would replace it with "newsletter" in my search of the network, which was kind of Orwellian:

I think disagreement is the engine of change. Good ideas win or lose on their merits.

It might be short-form memes or long-form articles and books. But you need to be able to win your arguments that way.

Force is the *last* resort, usually in defense from irrationality.

But.🧵 Maybe I’m old-fashioned.

I was always taught in martial arts to be polite until hit, but then to rekt whoever hit me or those I am responsible for.

I think that’s pretty fair. It is a very high hurdle before your ideas can hurt me or my family enough for me to hit back.

A lot of individual facts that the bears were saying in 2023 and 2024 were correct, but those facts were dwarfed by fiscal dominance. For example, net bank loan creation was sluggish at just $300B over the past year.

But banks also bought $400B net in Treasuries.

I keep seeing the chart float around of 23 million government employees, as though that's directly cuttable by the new Department of Government Efficiency.

Keep in mind that 3 million of those are listed as federal and the other 20+ million are state/local.

A thread. 🧵
Now, quantifying the actual federal workforce is actually nontrivial.
-Are we talking civilian, or military too (1.3M)?
-Are we including postal workers (550k)?

This WH report says 4.3 million federal workers with all of this, with breakdowns.
whitehouse.gov/wp-content/upl…

Along with Steve Lee @moneyball and Ren @0xren_cf, I co-authored a paper that analyzes the process and risks of how Bitcoin upgrades its consensus rules over time, from a technical & economic perspective.

Here's a 🧵

You can check it out here:
github.com/bitcoin-cap/bc… Here's the v1.0 PDF version:
github.com/bitcoin-cap/bc…

CPI for November came in this morning. Headline numbers continue to bounce around above 3%, while core continues to gradually decrease. 🧵

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.

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. 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.

Four monies, personified:

-The Golden Monarch
-Lord "Uncle" Sam
-The Dragon Emperor
-Archmage Nakamoto
🧵 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.

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.

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

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.

I've been making the economic comparison between the 2020s and the 1940s for 3-4 years now, while optimistically saying that hopefully it would be "less kinetic".

It has become "more kinetic" lately, so here's a brief thread on the issues. Unfortunately it goes both ways; sovereign debt crises tend to lead to war, and war tends to lead to sovereign debt crises.

An indebted empire can lash out, or enemies of the empire perceive the gates to be down, or earlier war is what causes the debt crisis in the first place.

Some people suggest we should ignore market forces and signals like "price", in favor of the environment. I get the sentiment.

But if something is more expensive, we should ask why. Is it more materially intensive? Is it more environmentally impactful than we've been told? There are two potential answers here.

One answer is tragedy of the commons. If I dump toxins into a river to make a cheap product and not pay for the remediation costs, I am polluting the commons to compete on price. The costs are hidden and dispersed. That's bad.

The EV market is very polarized.

Some people seem to think it’s a climate panacea. Others seem to think it has no value.

The answer from broad science lies somewhere in the middle, with nuance. 🧵 Many people think electric vehicles are new tech, but they are not. They have been around since the 1800s, as long as internal combustion cars.

They were outcompeted because batteries are inefficient energy storage mechanisms compared to hydrocarbons. Now, they stage a comeback.

Heading back to Egypt for the rest of the summer.

Over the past 18 months or so, the Egyptian currency has been cut in half relative to the dollar.

So my little wad of cash that I had lingering from last time that I will be bringing with me is worth less.

1 USD = 31 EGP
A🧵 Egypt needed an IMF loan to keep their dollar-denominated debt in working order. And one of the conditions from the IMF was to devalue the currency, to try to improve import/export balance.

It makes people poorer, but then (arguably) more competitive in the global labor market.

From interacting with nine-figure and ten-figure asset managers over the past several years, I've come to a few observations. 🧵 An entity that manages over a trillion dollars is like an entity that manages a million-person city.

It's not unanimous. There are factions, concentrations of knowledge, and so forth. Anyone who works with them knows this. In short: it's big and complex.

From 1945 to 2022, the total amount of debt (public and private) in the US increased from $363 billion to $93,497 billion ($93.5 trillion).

That was a 7.5% annualized increase. And it was very smooth- there was only ever one time where it decreased slightly: 2009. A debt is a claim for dollars. Going into the 2008/2009 crisis, there were $53 trillion claims for dollars and less than $900 billion ($0.9 trillion) in actual base dollars. It was a 63x ratio.

The game of musical chairs was breaking.

The two biggest source of broad money creation are 1) bank lending and 2) fiscal deficits.

In the 1970s inflation saga we had lending dominance, while in the 1910s, 1940s, and 2020s inflation sagas we had fiscal dominance This chart shows year-over-year loan creation and fiscal deficits for the 1960s/1970s in absolute dollar terms (billion USD) compared to the prior year. Loan creation was a bigger source of money creation than deficits, and drove inflation.