2020 Collapse

Discussion in 'Markets & Economies' started by TreasureHunter, Dec 8, 2019.

  1. BuggedOut

    BuggedOut Well-Known Member Silver Stacker

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    Ok, so consider PAXG - the gold-backed crypto to be the equivalent of a Gold ETF. Yes, there is counterparty risk but it is otherwise not that different but the crypto version can be transferred quickly, cheaply and anonymously amongst holders...even if redemption may be difficult or impossible for an individual (they are based in Singapore from memory)

    These counterparties will often submit to auditors etc to confirm that the reserves are valid and exist (though not always - it depends on the counterparty)

    People need to get out of their head that crypto is this tangible, intrinsic thing. Really they are usually just a more efficient version of things that already exist, often with no more or less risk involved.
     
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  2. BuggedOut

    BuggedOut Well-Known Member Silver Stacker

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    Oh, I almost forgot - check out PMGT - The Perth Mint Gold Token. Another gold-backed crypto from the Perth Mint....effectively backed by the government of Australia?

    Remember, we all have to crawl before we can walk....and we've only just started crawling....
     
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  3. holdandown

    holdandown Active Member

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    Yeah I guess it comes down to a preferred investment strategy. As you say there is something to be said for making investment processes more efficient with regards to investment vehicles that already share similar risk levels.

    Spreading the risk around may be the way to go, meaning, keep at least some of one's investments tied up in physical pm's under your own control (aka stacking) and hope for the best with the other managed investments.

    I would be careful to note the distinction between stacking (when defined as taking physical possession of pm's and securing them at your own property) vs "paper gold investments" because these aren't the same things although many folks out there seem to think they are.
     
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  4. alor

    alor Well-Known Member Silver Stacker

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    premiums seems a bit lacks now
    since post and mail are moving well
     
  5. TreasureHunter

    TreasureHunter Well-Known Member

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  6. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    Only reason I'm buying more crypto is because I got a nice raise at work and a bonus.
    We cant find any employees and are down to 6 on the asphalt crew now.
    Starting wage has doubled and a signing bonus so we get that too whoohoo! It's nice to stick it out sometimes.
    I'm really enjoying the smaller crew but the boss is shitting himself.
     
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  7. holdandown

    holdandown Active Member

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    That lack of enthusiasm in the labour force for work may be a hangover from the stimcheck helicopter money bonanza so grab those $$ while the going is good and don't forget to stack. \m/
    My best guess is that cryptos were riding high on stimcheck money. I'd be concerned that once that starts drying up and scrubs need to go find themselves actual jobs again it will have a knock-on effect on the crypto markets.
     
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  8. TreasureHunter

    TreasureHunter Well-Known Member

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    The Fed will increase interest rates, gold plunges. You saw this probably.

    The USD is already up in many currencies.

    Perhaps the USD will become more expensive temporarily. Might be a good grab now if you're planning to travel post-covid.

    I wonder how this could impact cryptos.
     
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  9. hardyakkagold

    hardyakkagold Well-Known Member Silver Stacker

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    The cryptos and other digital and paper assets have been riding high because of the cheap near zero percent and even negative interest rates,
    something we have never had before in recorded history.

    It has little to do with the stimulus money and government handouts.

    Like I said previously on another thread when interest rates start returning back to their normal levels then you find out what the true value of your cryptos, shares real estate, and other assets are.

    Right now they are all in a bubble just waiting to pop.

    And you won't have to wait until 2023 for interest rates to start climbing, forget what they a saying.

    They are working hard behind the scenes to engineer an inflation breakout so that they can then claim that they have no choice but to start
    raising interest rates sharply next year to combat the inflation that they created.

    Interesting times coming up in the next few years that's for sure.

    And as the Chinese curse proverb alludes to, it will be more of a curse than a blessing for most of the unprepared people.
     
  10. mmm....shiney!

    mmm....shiney! Administrator Staff Member

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    o_O

    How do you know that if they're working hard behind the scenes?
     
  11. hardyakkagold

    hardyakkagold Well-Known Member Silver Stacker

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    Hey shiney you were on my ignore list, but you are no longer on there what happened you unlisted yourself?
     
  12. mmm....shiney!

    mmm....shiney! Administrator Staff Member

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    Nope. Maybe you can't ignore a Moderator?

    Anyway, how do you know that Central Banks are secretly planning an inflation breakout?
     
  13. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    It's no secret. Theyve printed trillions in the open and bragged about it like it's a good thing.
     
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  14. mmm....shiney!

    mmm....shiney! Administrator Staff Member

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    They're not printing millions to in an attempt to create an inflation breakout. They're printing millions in an attempt to create a debt fuelled spending economic recovery with a moderate rise in the inflation rate, for the RBA it's around the 2% mark. And doing a shit job of it.

    @hardyakkagold is arguing that they have a secret plan to engineer an inflation breakout. This implies a rate of inflation in excess of their mandated task. There is no public evidence that the RBA or The Fed are planning on engineering an inflation breakout so I was wondering how he came to the conclusion. Either he must be privy to the discussions in the board meetings that's not reported in the minutes or when they face The Senate, or he's just making it all up as he goes along. I'm of the opinion he's just making it all up as he goes along.
     
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  15. mmm....shiney!

    mmm....shiney! Administrator Staff Member

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    And printing money on its own won't create an inflation breakout until the demand for labour outstrips supply which will result in significant wage rises. Which is likely to be years away.
     
  16. holdandown

    holdandown Active Member

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    A view here that stimulus money has had a major impact on cryptos. Particularly in countries such as the US.

    Imo another reason the crypto-sphere has been riding high recently is because of the infinite money printing and stimchecks filtering its way through the economy. Scrubs sitting at home have been spending much of that money, and guess what they have been spending it on?

    A: Cryptos

    • Are the authorities in the US and elsewhere going to sustain QE, helicopter money, infinite fiat issuance and stimchecks for scrubs indefinitely?
    • What happens when they stop issuing helicopter money?
    • To what degree will countries who are less engaged in QE and moneyprinting go along with a system where major countries keep debasing their currencies yet the apparent purchasing power of the QE countries - vs the non-QE countries own currencies - appears to maintain its purchasing power in relative terms? Will this system start unravelling or will the non-QE countries be too afraid of being bombed back to democracy by the QE countries if they got off that fiat train and demanded to settle trade in hard assets?

    It seems counter-intuitive to me that the current system can maintain itself indefinitely. The "solution" to such economic problems are often wars. A war climate is openly being stoked and promoted today. As usual many among the public think it's a wonderful idea while the media fill their heads with the nobility of the cause, the righteousness of it all not to mention the holy and hungry gods of human rights, democracy and freedom for whom sacrifices must be brought.

    That's why one should also stack and maintain a contingency plan separated from virtual assets.
     
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  17. mmm....shiney!

    mmm....shiney! Administrator Staff Member

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    Onchain analysis shows that the number of new addresses (which would contain stimcheck funds) is no where near as high as the peak in 2018. The greatest number of new addresses since then were created during January this year, some 2 months before the $1400 cheques were issued. No doubt some of the money printed and issued as stimulus cheques would have been spent on crypto, but it's more likely they would've been spent on consumables for example:

    Screen Shot 2021-06-18 at 4.00.36 pm.png
    https://tradingeconomics.com/commodity/lumber*

    * supply constraints also played a major factor.

    Those not engaging in QE can't because their bonds really aren't in high demand as their currencies can't be converted into commodities of value or other more highly regarded fiat currencies. I think Indonesia is mostly skipping the bond issuing bit and its Central Bank is just directly crediting the government with Rupiah. No one wants Indonesian bonds. US bonds or Australian or any of the world reserve currencies have a ready market and so their governments can issue bonds. Most of the rest of the world doesn't.
     
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  18. alor

    alor Well-Known Member Silver Stacker

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    its a debt based system, thinking about debt traps
    other countires can use inflations, their rates are mostly higher than 5%-20%, its also another paper based system
     
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  19. holdandown

    holdandown Active Member

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    It's a pity one cannot trace stim money and see directly where it goes. Many of these people may have already had trading accounts but would have lacked the funds to go wild in the casino.
    To put it another way, many of these folks may have been less inclined to gamble money they had to work for and which they would have had to use to pay bills, vs splashing out magic money they were just given.
     
  20. mmm....shiney!

    mmm....shiney! Administrator Staff Member

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    Their rates are higher because their systems aren’t as secure, so they have to sweeten the deal.
     
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