oh, I missed this
15 April 2021 05:41![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
m_d_hThe market capitalization of Bitcoin is now more than a trillion USD. Roughly 1/10 the value of the world's above-ground gold, and roughly equivalent to the value of the world's above-ground silver. A bit more valuable than Facebook, but a bit less valuable than Google.
A set of electronic serial numbers is worth more than Facebook. I'm not sure who the joke is on in this comparison.
There's currently only one asset category with a larger market cap than gold: US government debt. Total government debt issuance in the US is well over $20 trillion, meaning those who (could) pay taxes to US governments are more valuable to the world's wealthy than any other asset.
Yet the US is currently breaking records in the extent of its budget deficits, so I'm not sure why the world's investors value US taxpayers so much, as though we are actually going to pay them back someday LOL.
-----
The everything bubble that continues to grow in front of my incredulous eyes is not magic, not mystical, it is driven by the issuance and hoarding of signifiers of value that are all based on misplaced trust -- trust that when the holders want to cash in their chips, cash will be received. But the "bank" of the US Treasury currently has only about 5 cents on hand for every dollar in debt held by the public.
The $22 trillion of outstanding US Treasury debt signifies a great deal of wealth to those who hold it, but this wealth is a mirage. There is no $22 trillion. We're not paying you back!
-----
Most of the world's wealth is held by fewer than 1% of the world's population. These wealthy people are engaging in a massive financial circle jerk to inflate the value of their already considerable holdings, by lending their excess cash to entities that will never pay them back, while valuing these "loans" at their nominal face. They then use these fraudulent IOUs as currency for bidding up the values of their real estate, corporate stock, precious metals, cryptocurrencies, and art.
It's not just the US Treasury. Japan has issued $10 trillion in debt. China has issued $7 trillion in debt. Several European countries have each issued one, two, or three trillion in debt, as have Australia and Canada. You haven't made it as a country until you've issued at least a trillion USD in debt.
These governments are never paying back these debts! But we all pretend they will, and the global 1% trade these IOUs as though they were as good as cash.
-----
I've got a large chunk of these IOUs myself, in my retirement account. But the alternatives in my TSP are also overvalued. As I've written before, I expect all of these options to lose value in the future, so I'm kind of stumped regarding how to allocate among them. It's a game of which investment class will crash first? Avoid the one that will crash first.
-----
Bernie Madoff died this week. T said to me, "Wasn't he the largest Ponzi scheme in history?"
No, that's the US Treasury. But the US Treasury hasn't been caught yet. People still give their cash to the US Treasury hoping to get it back someday, plus interest.
But awarding the crown of "largest Ponzi scheme in history" to anybody would distract from the ubiquity of Ponzi schemes. Ponzi schemes are now everywhere, everything, I'm not sure how to find an investment today that isn't a Ponzi scheme.
If you have extra cash, spend it on stuff and experiences that you personally will cherish. Invest in yourself, your family, your partner(s), your friends. Or give it away to somebody who needs it so they can pay for food, shelter, or medical care.
-----
I saw an article the other day in the WSJ about a couple who made billions via managing hedge funds -- they'd made the news by promising to give away 5% of their immense wealth each year.
Just 5%.
Of their billions.
That was newsworthy, that one couple is willing to give away 5% of their billions each year.
A set of electronic serial numbers is worth more than Facebook. I'm not sure who the joke is on in this comparison.
There's currently only one asset category with a larger market cap than gold: US government debt. Total government debt issuance in the US is well over $20 trillion, meaning those who (could) pay taxes to US governments are more valuable to the world's wealthy than any other asset.
Yet the US is currently breaking records in the extent of its budget deficits, so I'm not sure why the world's investors value US taxpayers so much, as though we are actually going to pay them back someday LOL.
-----
The everything bubble that continues to grow in front of my incredulous eyes is not magic, not mystical, it is driven by the issuance and hoarding of signifiers of value that are all based on misplaced trust -- trust that when the holders want to cash in their chips, cash will be received. But the "bank" of the US Treasury currently has only about 5 cents on hand for every dollar in debt held by the public.
The $22 trillion of outstanding US Treasury debt signifies a great deal of wealth to those who hold it, but this wealth is a mirage. There is no $22 trillion. We're not paying you back!
-----
Most of the world's wealth is held by fewer than 1% of the world's population. These wealthy people are engaging in a massive financial circle jerk to inflate the value of their already considerable holdings, by lending their excess cash to entities that will never pay them back, while valuing these "loans" at their nominal face. They then use these fraudulent IOUs as currency for bidding up the values of their real estate, corporate stock, precious metals, cryptocurrencies, and art.
It's not just the US Treasury. Japan has issued $10 trillion in debt. China has issued $7 trillion in debt. Several European countries have each issued one, two, or three trillion in debt, as have Australia and Canada. You haven't made it as a country until you've issued at least a trillion USD in debt.
These governments are never paying back these debts! But we all pretend they will, and the global 1% trade these IOUs as though they were as good as cash.
-----
I've got a large chunk of these IOUs myself, in my retirement account. But the alternatives in my TSP are also overvalued. As I've written before, I expect all of these options to lose value in the future, so I'm kind of stumped regarding how to allocate among them. It's a game of which investment class will crash first? Avoid the one that will crash first.
-----
Bernie Madoff died this week. T said to me, "Wasn't he the largest Ponzi scheme in history?"
No, that's the US Treasury. But the US Treasury hasn't been caught yet. People still give their cash to the US Treasury hoping to get it back someday, plus interest.
But awarding the crown of "largest Ponzi scheme in history" to anybody would distract from the ubiquity of Ponzi schemes. Ponzi schemes are now everywhere, everything, I'm not sure how to find an investment today that isn't a Ponzi scheme.
If you have extra cash, spend it on stuff and experiences that you personally will cherish. Invest in yourself, your family, your partner(s), your friends. Or give it away to somebody who needs it so they can pay for food, shelter, or medical care.
-----
I saw an article the other day in the WSJ about a couple who made billions via managing hedge funds -- they'd made the news by promising to give away 5% of their immense wealth each year.
Just 5%.
Of their billions.
That was newsworthy, that one couple is willing to give away 5% of their billions each year.