Bitcoin and the Global Macro Landscape

Gold backed currencies in Brazil, Russia, India, and China, the BRIC countries is looking more and more possible or likely.  See this interview with Max Keizer, click here to view on twitter.

 

Here is an article in Reuters about Russia and China discussing their partnership and international payment the two countries will engage in.  Both Nations are accepting payment for Oil in their respective currencies.  Both have enough Gold stored to back their respective currencies in Gold, click here to read more.  

 

This is good for Gold yes, it is also good for Bitcoin.  Below is the USD/RUB chart.  The Ruble is up 10% on the USD recently.  This is increasing pressure on the Fed to rein in inflation by raising rates.  However, how long can this really last?  As the Ruble strengthens, it hollows out the resolve of the Fed to fight inflation, if GDP keeps contracting, as it did by 1.5% in the first quarter.  Here is the USD/RUB chart below:

 

 

It is our firm believe that once the economy in the US shows major cracks and they widen.  That is when the Fed reverses course and begins going dovish again.  As in 2020.  July is when the second quarter GDP growth statistics will come out.  By the end of July, if GDP contracts again, we will know where we stand.  Perhaps by August or September, the Fed reversal will come.  The DXY is now over 104.  Up even from yesterday.  Highest since 2002!  Here is the latest DXY (USD Index) chart:
 

The DXY dropped from 120 to 71 from 2002 to 2008.  Easy money policies in those years, led to the 2008-2009 Global Financial Recession.  High inflation since the early 70’s after the USD got off the gold standard, also led to the Manufacturing base in the US shipping jobs off to China, Japan, Mexico, Taiwan, and India.  Now the US has a - $110 Billion annual trade deficit.  Here is that chart below:

 

 

Between this trade deficit, and the $30 trillion national debt.  The Fed has to much to lose with the economy collapsing to stick with raising rates once this collapse shows up statistically.  So we need to watch the GDP growth %, DXY chart, the 2 yr, and 10 yr Bond Yields, and the national debt statistics.  If GDP growth is down in July when second quarter statistics are released.  This Fed reversal won’t be far behind that time frame.  Whenever that actually does happen.  That is when the DXY will reverse course.  It is showing signs of it right now.

This next chart compares the DXY now in 2022, to 2016.  We cannot pin down time frames.  Whenever, the Fed talks dovish again.  Whenever the DXY starts falling.  Look for the real Bitcoin breakout.  What happened Wednesday and Thursday was a fake out.  The real one will occur when the DXY falls:

 

 

Remember, Bitcoin is mined through proof of work mining.  70% of which is mined through renewable energy, and the rest through waste gas and flare gas that is a waste.  Fiat currency and the alt coins like Ethereum are proof of stake.  Not proof of work.  Examples of proof of work mining for currencies are below:

• Shells 
• Salt 
• Sugar 
• Bronze 
• Copper 
• Oil & Gas 
• Ore 
• Coal 
• Silver 
• Gold

At different historical times, these have been used as currencies.  Bitcoin is the only currency backed by proof of work, that is being used as such present day.  Now that the BRIC nations are starting to back their currencies with Gold.  Europe and the US are wanting to go to CBDC which (like fiat currency), is backed by nothing.  What will hold up as a store of value in 20 years.  CBDC or Gold or Bitcoin?  Well, here is a comparison chart:

 

 

When Bitcoin flounders.  We all have to steel our resolve!  This asset is THE most valuable endowment, THE most valuable, scarce property.  It WILL become a trusted currency over time in some capacity.  Perhaps as a backing for fiat currency.  Adoption of Bitcoin is not slowing down.  It is expected that the SEC will finally allow a Spot Bitcoin ETF later on in 2022, by the fall we hope.  We have mentioned some $20K predictions for a Bitcoin bear market.  However, it is just as likely $30K to $35K is the bottom, and once the DXY rolls over, another Bitcoin bull market will ensue!  Don’t sell, stay passionate, and keep learning!  Bitcoin is here to stay, it is a long term, generational investment.  We are not financial planners and this is not financial advise.  It is not easy to HODL (hold on for dear life).  The squeeze is worth the juice!  Nothing great is easy to do.  By end of 2032, we see Bitcoin over $1 million per coin.  It takes time!  

 

Neutral ATM is here to get everyone off of zero Bitcoin.

 

Give Neutral ATM a try.  We have low rates, convenient locations and we are expanding. Contact Neutral ATM, we will answer all your questions about Bitcoin and using our ATM machines. Find a Neutral ATM Bitcoin machine location near you.