Reddit Posts
Any intelligent people out there w/ real explanations?.... Do any cryptos have any intrinsic value? Or will all be going to near zero if/when a recession/crisis hits?
Putting the Luna / UST collapses in perspective
Terra/Luna blockchain has been halted. News from Newton trading platform.
RBI Governor's anti-crypto speech is more about territory protection and less about objective truths
13 years since conception. 15 years since the GFC. Is Crypto replicating fiat or replacing it?
The Ghost of Mt. Gox Part 10: Regulation
The Ghost of Mt. Gox Part 5: False Cycles
The Purpose of Bitcoin Appears to be to provide an alternative to the fiat debt slavery monetary system.
Let me break down the Evergrande FUD for you:
Mentions
The 2008 GFC was a 53% drop. The 2000 dot com bust was a 49% drop. The 1973 crash was a 48% drop. It took 17-30 months for those declines to reach their bottom levels. We're currently 6 months into a decline and have gone down 23%. If we're following those historical recessions, it could be 12 months before we find out if we have reached a bottom.
Man do I disagree. We have not seen anything like the psychological capitulation remember from prior bear markets either in stocks or crypto. The drama unfolding with CEX is not over. There's still likely interest rate hikes ahead. Macro conditions are not better or stabilizing. The recession is just getting underway. Fuel, food, and other supply chain problems getting worse. Capitulation has a smell. I was around for dot com and GFC bears, investing though both. The air still smells too sweet around here and elsewhere by half, like a bullet somehow got dodged. That was tracer fire. Artillery shell incoming.
Most people ‘into crypto’ are under 40 yrs of age. If you are 40 now, you were around 26/27 in 2008/9. The age when the GFC would really have made you sit up and take notice. You were just beginning to accumulate assets, finding your feet in your career / business, buying a house, maybe getting married. Sure the GFC would have been memorable to teenagers whose families were torn apart, but it still was not YOUR hard earned money / savings / assets that were affected. So only people 40 or above IN GENERAL really appreciate how things can contract, and to just what extent. Those below that age have IN GENERAL never known anything but continuous growth. Some years faster than others, but no real corrections. It shows.
In 2016 China was welcomed by the IMF to join the reserve currency board and Yuan was included in the basket of currencies composing the IMFs synthetic SDR. This was because post GFC only China had the productive and growing economy strength to help pull the anemic and corrupt highly leveraged and financialised western economies out of the mire. China stopped accumulating USD Treasury bonds several years ago. Does the US have any reserves or is Fort Knox empty? Russias invasion of Ukraine is backed by China and if successful will probably lead to Chinas acquisition of Taiwan. Unlikely we have 15 or even 5 years before this happens. [https://www.newyorker.com/news/daily-comment/russia-and-china-unveil-a-pact-against-america-and-the-west](https://www.newyorker.com/news/daily-comment/russia-and-china-unveil-a-pact-against-america-and-the-west) ​ Once the change from USD global control becomes apparent, and this is already happening, the wealth and power of the USA can decline very swiftly as its viability is now highly dependent upon the vast seigniorage income derives from its global monetary hegemony. There is a tipping point, IMO not far off, where that seigniorage income rapidly declines as USD credibility disappears. What is obviously required are alternatives to the USD- it has been the lack of any alternative that has extended USD dominance thus far. There are currently only two alternatives that are not already under US monetary and military patronage. The Chinese Yuan and Bitcoin. The Yuan with its already operational (if not fully implemented) digital form is clearly well in advance of Bitcoin, but equally there will be huge demand for Bitcoin as an alternative to the Yuan. USD vs DCEP vs BTC.
A single prop credit trading desk at a big bank I worked at during thr GFC lost multi multi billions in a matter of days...it was mayhem
So true….don’t even mention the GFC in ‘08 paid for by the general public.
Well data already shows (as evidenced by earnings reports from Visa and banks for example) that it's affecting lowest income earners most. Again, that's bad, and does effect the economy, but currently contained. Household balance sheets are still higher than they've ever been, and usually lower income owners don't own assets, or much of it (like stocks) Also, as unemployment is still incredibly low, like still close to maximum employment, although there will be further shedding, most higher income earners will be relatively insulated, as they have more disposable income. Yes that disposable/investable income will reduce, so there will be less for assets, so not saying we're going to be in a huge bull run. I just think a crash and major correction has already happened, and more is likely to come, but it's not going to go as far as GFC or depression. There is still room for retail capitulation, as we've been resilient and data shows there's still net inflows from retail, but that is steadily decreasing. Historically once retail starts to capitulate, there's a bottom. Either way, higher income earners will still be investing in stocks. The cash that goes towards living expenses suffers from inflation, it loses value. However, disposable/investable income actually benefits from inflation (so long as the market is crashing alongside it), because that means there's deflation in the asset market i.e. your investable income becomes worth more, you can acquire more shares.
He’s not saying crypto crashing is going to effect the entire global economy the way the 08 market crash did. He’s just saying the collapse of tether and the exchanges thats happening in crypto is going down exactly the same way the housing market and investment banks collapsed when the GFC happened. Of course it won’t spread contagion throughout the global economy the same way but it will do some serious damage to the Crypto markets.
Interesting opinions. One thing I notice about most commentators is that they assume we are in a normal stable, or upward phase of economic growth, and this makes a lot of their analysis erroneous. For example, in a period of high inflation, which we have been in for over half a year, stock prices rally. We are seeing the opposite in stocks. And houses are selling off. Who sells houses in a time of inflation? You wait for the gains. But of course there are no more, in either. What I see in all this is a repeat of the GFC. Gold fell as a market crash was underway, Oil went to all time highs, Real estate sold off. This collapse in the economy might not be as bad as 2008\~2010 but it has the same fingerprints all over it. Of course it could be a lot lot worse too given the debts outstanding across the board.
Got into gold pre-bitcoin. Gave up on that post-GFC until I discovered Bitcoin in 2017.
TA started to become quite popular, even amongst the instos, pre-1987 After the crash, it disappeared for a long time for good reason. I do remember the TA guys resurgence and citing the same old bullshit pre GFC. Was private stock forums and never saw it much in the instos - but just unable to perceive when the paradigm had changed and kept averaging down till the bank sold the house.
A lot of people here don’t seem to remember the GFC in 2008. As soon as the sea gets a little stormy they start ranting and screaming it’s the end of days. It may be shit right now, but it’s been shitter.
For anyone reading this post, this is a common myth. Current Fed reserve ratio is 0%, reserves don’t matter. After GFC (2008) banks were heavily regulated to assure they could meet their liquidity flows and have to regularly pass stress tests. This regulation has greatly lessened the chance of a banking collapse like the one seen in 2008. Further, the Fed (yes, the notorious Fed) has stepped in as a lender of last resort to support liquidity during times of crises. Crypto has none of this shit. Regulation, laws and experience have evolved the system to a point where bank runs and liquidity crises should be extremely unlikely. This helps foster a more stable environment to create long term growth prospects for all. It’s not perfect, but at least it’s not a scam.
I mean majority of new people did it for the financial returns, not cause they actually believe in crypto. And TBF this also happened to banks during GFC, they just actually had regulations so there were safeguards. Most people knowing crypto wouldn’t do this, but the majority of crypto holders don’t know crypto
Not your keys not your coins. There are no protections. They have no government to bail them out like the banks did in the GFC. Their terms and conditions state that you could lose your bag at any time and they have no obligation to pay you out. Crypto was invented to get rid of middlemen for this exact reason, but you went and gave all of yours to a middleman. I hope you get it back.
If the biggest investment banks in the world can go bankrupt (see the 2008 GFC) then yes I’d say it’s a possibility some unregulated crypto exchanges could go down in the same way as Celsius
Financial systems about to enjoy the largest collective shocks since 2008 GFC. This isn’t the time to be in speculative assets like crypto. Lower for longer. Capital preservation is the key now, and cash is king.
I remember writing this was going to happen January 2021 and everybody was saying it was a crazy idea because of Japanese and GFC QE
Theres been a lot of time to learn the lessons of the GFC.
Everyone highly doubted the GFC would happen.
You want to dream about a total economic collapse? Did you not see how badly people were affected by GFC? Or maybe you werent born then.
100% Sadly alot learned this the hard way in post GFC chaos, losing money to failing banks. I've spread it across property and other assets, and also I like owing the bank money on mortgages because it gives me some debt to offset against the debt they owe me. However the main reason I like debt is that it will be trivial to pay back in the future when the government prints and inflates away our debts. The rich are scamming us with this debt laden money printing, so we have to at least take good mortgages to try and keep up.
Now overlay the BTC 10 year chart with the USA money supply 10 year chart. The trillions of $$ printed since the GFC has had to go somewhere, much of which seems to have gone into risky assets. Now the printer has been turned off, and is looking like the shredder is about to be put to use. Bitcoin has never functioned in an environment without a gigantic wall of money pushing from behind. Who knows what will happen, but this is not the same world Bitcoin was in only a year ago. We may finally see, for the first time, the true value of Bitcoin. We should all be excited, as many of our questions may indeed finally be answered...
> We've never gone through a recession in the social media era. The 2008/2009 recession was before smartphones truly became ubiquitous Social media != smartphones. Facebook and multiple other social networks already existed for years before the GFC.
Not floating Yuan may slow internationalisation but does not prevent it nor does it remove the very strong and compelling reasons for internationalisation. Who would want to accumulate more USD EURO bonds since they can be confiscated? China has been reducing its USD denominated reserves for several years now and given the size of its economy and surpluses, and tension with the US, can logically be expected to, and IS acting to remove USD reliance and increase Yuan acceptance. The proposed deal to buy Saudi oil with Yuan for example. The admittance of China to the IMFs reserve currency board in 2015 due to the significance of Chinese growth post the GFC was acknowledgement that floating or not, the Yuan is now emerging as a reserve currency. There is no denying China is an economic force that under current leadership presents a challenge to the global power and hegemony of the USA. As part of that China is challenging the USAs single most important strategic asset- its global monetary hegemony via SWIFT, with its digital Yuan, DCEP, reverse engineering the banking payments system that was introduced by Britain via HongKong after 1840 through the Opium Wars. To acknowledge this is not to take sides but to recognise historical and contemporary reality- something you are avoiding.
Works for who? Inflation due to constant money printing, a widening wealth gap. I have to pay my bank each month just to keep it open, unless I keep a certain amount in it… just sitting there depreciating. Bitcoin was arguably built in response to the GFC, where bankers showed they were incapable of being ethical, responsible, even legal in some cases. Without even going into Web3/ the future of the internet, the in corruptible nature of bitcoin - a digital property transferable, incorruptible, and something that will be here in 200 years - is why it has value.
In my humble opinion, much of the noise spawns from a rather reductionist "fuck the banks!" mentality, and particularly from Americans. I absolutely understand that GFC wrecked millions of people in the US, and the cultural memory of those bad times persist today. This, coupled with a general distrust of the government often seen to be in cahoots with big corporations, and not looking out for the average citizen. I'm not American, I don't live in the US, and the anti-banking brouhaha is just not there, where I live. Crypto is seen as an investment, and isn't tied to some libertarian distrust of conventional finance or government institutions. It really helps that I've been living in places where the governments have been adequately providing for their citizens. There are problems of wealth inequality too, but folks don't go around shaking their fists at government overreach, or fear that the government is out to wring them dry.
To be fair, they've been printing money since the 2008 GFC ("quantitative easing"). When you print money for over a decade apparently it's not good ...
MicroStrategy has [over $2.2B in debt](https://finance.yahoo.com/quote/MSTR/key-statistics?p=MSTR) it mostly used to buy Bitcoin. The minute it hits $21k, they are forced to find money to cover some of its debt. If the only thing they can liquidate is Bitcoin, it will push the price of Bitcoin down hard which will result in its other debt covenants coming under stress.. People love Saylor like he is some kind of Bitcoin god. He's a gambler, the type of big institutional gambler that the original Bitcoin inventors hated so much after the GFC. Take other people's money gamble that you'll make a packet and then if you lose who cares, bailout or bankruptcy. Either way, the downside risk is never borne by these types. I doubt Satoshi would have been happy with creating the groundwork for what could be a Bitcoin Financial Crisis.
Yeah they're regulated, there can still be a run on the banks, happened in Ireland during GFC. Happened in Turkey when the Lira tanked. I agree tether is a liability. It's run by the Bitfinex directors and they have a vested interest in not letting the market get decimated.
I was referring more to the Al Capones and Paul Manaforts of the world, but I would include the Bernie Madoffs and any of the CEOs and fund managers et al that contributed to the 2008 GFC and should have been prosecuted (although I would argue the ability to subpoena the banks to use their accounts as evidence wouldn’t necessarily have been required to obtain a conviction given the transparency and publicity of most of their actions.)
2008 was GFC, dot com was 2001
It's honestly difficult to say. The historical cycle would certainly suggest so. but as they say in finance "historical performance is not a reliable indicator of future performance" Realistically Crypto only has slightly over a decade of sample size and this is also the first serious global recession since it's inception on the tail of the GFC. There's no crystal ball at this junction in the road. Especially since in previous bull/bear/dormant runs there was far less scrutiny, regulation, media, market capitalisation, Blockchains, adoptions and you get the point. Using historical data as a guide is extremely circumspect when new ground ahead is an understatement
Exactly, BTC was created because of the GFC, it's never come close since then
Not invested myself in the Terra Luna system but the entire market is being hammered by what’s happening here. I see a lot of schadenfreude in lot telegram channels and sub-reddit , people don’t realise this affects everybody with crypto holdings, even the centralised stablecoins, who is going to trust crypto in the future? Titan was peanuts compared to what’s happening right with Luna/UST Even in a free market ,during GFC centralised entities have to step in to stop the run on the banks and the stock market , it’s time the big players in this space (CEX, VCs….) need to think long and hard about staging an intervention because fear is contagious , next thing you know USDT will have a bank run, and that will put a nail in the coffin for crypto.
Thrilled! And know this is just the start. I've been a permabear since the GFC, which is unfinished business to me. I did capitulate in November, my bad, and bought about $30K of about 9 big crypto names for a decades hodl just in case "this time it's different" tho it never is, this IS crypto, and that HAS to lead to change eventually, also hoping it soon diverges from the wall st insanity. That's the reason it's supposed to exist, not to freaking become just another meme stock. So that's down Bigley. But I hold some BBOZ.AX that I hope will 20 X minimum in the next year or two. That's a bear ETF.
People's savings burning isn't something to be happy about. People lost everything in the GFC if they were over exposed to real-estate or bought over valued properties with the dream of the markets keeping the prices up. Will you laugh at them too? People who bought Enron or pets dotcom were wiped out. Would you track their families down on a message board if you could for a laugh as well? Finding flaws in crypto is good. Educating is good. Taking a moral stand is good. Mockery benefits no-one. It comes off as childish and usually stems more from jealousy or other misplaced emotions.
You shoud perhaps consider the impending recessionary times into your calculations. I'm very very long term bullish on Bitcoin, but it's never been traded in periods like we saw in tbe GFC. Perhaps it's another GFC that's required in order for it to fully uncouple, as it one day will. Either way, I'm buying today, as I did last week and every week before that, but I'm still going to sell into a large run up, as I did when it hit $64k. My position is different though as I'm in my 50's and don't have as much time in the market left as lot of you. If I were in my 30's or younger, I would just hold forever, I just have a 10 year time frame which influences my decisions as I won't be around in the markets to recoup losses from massive crashes.
i include: 1987, LTCM/Russia default (1998), dot-com crash (2000-1), GFC, this
That's not their only loan. They're borrowed more than $2,000,000,000 to buy over 120,000 bitcoins at an average price of around $30,000 each. All that debt, every single dollar of it, has a loan covenant attached to it. One covenant activating causes a liquidation event that could activate the next and so on. The fact that you can't see the parallels between this and the bad debt of the GFC shows you don't understand the situation.
Just better hope it doesn't come close to the margin call level of MicroStrategy. They would be forced to start to liquidate billions of dollars of Bitcoin at $21K. It's the making of a disaster similar to the GFC which inspired the creation of Bitcoin in the first place. I would be strangely ironic if big banks funding dodgy loans (in dollars lol) to other big corporations caused the Bitcoin Financial Crisis. Satoshi would be rolling in his grave.
Anyone watching charts on BTC to predict the low is wasting their time. Watch the regular stock market signals to see what is coming. It's not question that the stock market is in for a big crash worse than the GFC in 2008. So when that happens, buy BTC as it crashes right beside the market.
>But the people who are waiting for it to fail and who would celebrate the failure I'll never understand. Cryptocurrencies are pretty heavily steeped in both libertarian political ideology, and what are considered fringe economic beliefs like austrian school economics. Everything I have learned in my economics classes (grad school level) have indicated that crypto becoming the 'world currency' would be a genuinely horrible thing, both slowing down economic growth and limiting governments abilities to respond to financial or external shocks (like the GFC in 2008 or covid) Likewise, everything I have learned about finance (also grad school level) indicate that there is a fundamental lack of value in crypto making it a poor investment class too. I don't doubt that people have made money, but it is at the end of the day an either zero or negative sum game - that is not an appropriate investment. It's a gamble. So yeah, I want crypto to fail. I could imagine a use case for a government-created non-blockchain digital currency, like the one the US government is developing. But bitcoin? ETH? Any of the altcoins I have seen? I think the sooner they die off the better, to reduce the shock to the rest of the economy.
Bitcoin has its own large scale corrections, but has never been through global market turmoil such as the Dotcom or GFC. Pair both BTCs volatility and its first market crash, and boy is it going to go alot lower.
I like how he called the GFC, oh wait he didn’t get that right either 😗
What you quoted there states that fiscal policy is advocated over monetary policy and your subsequent statement is about advocation of monetary policy. You might be projecting when you say I'm lost in my own words. Expansionary monetary policy (aka QE) isn't Keynesian. It's a derivative of Monetarism after it failed and people wanting to avoid fiscal policy found it instead. It literally began because fiscal policy was prevented by certain politicians when the GFC hit years ago and the central banks saw no other alternative given their limited toolset. It's the ideological opposition to Keynesian economics which proposes fiscal policy use targeting full employment and maximizing capacity. The definition of inflation doesn't include the word "indefinite". I didn't say that and neither did you, but you're trying to make an argument based on it now because you're coping. Inflation is a rise in prices over a period of time. It can result from monetary factors or productivity factors, and a more elaborate definition would mention a basket and weighting of goods on aggregate as well. Deflation can also happen because of monetary and productivity factors. Zimbabwe replaced productive farmers with people who couldn't farm destroying their productivity and inducing inflation, while innovations in the US economy constantly induce a degree of deflation. Both of these are productivity factors driving inflation or deflation.
The analogies used seem quite tortured and don't really add much. He discusses the size of the market in comparison to the securites that caused the GFC quite a bit, and seems really rather scared of a collapse in crypto prices bringing down wider markets. Seems a bit of a stretch, but if it was the case and as he argues it's mainly owned by institutions now anyway, it seems the big money investment would have more of a stabilising effect
some people are.. gen x and baby boomers that were forgotten or had the unfortunate experience of making the wrong moves post GFC
tldr; BlackRock's Chief Investment Officer Tony DeSpirito has warned investors to prepare for the end of a backdrop of low-rates and slow-growth that's defined markets since the 2008 global financial crisis. "One thing we feel relatively certain about is that we are exiting the investing regime that had reigned since the Global Financial Crisis (GFC) of 2008," he wrote. *This summary is auto generated by a bot and not meant to replace reading the original article. As always, DYOR.*
>If there's a global financial crisis the dollar will be fine No, it really won't. Next GFC, the dollar will truly die. Because the financial situation we're in, plus the decoupling from the petro-dollar, will cause them all to come home to roost.
Bitcoin was built because of the 2008 GFC if it does what it was built for then BTC is going to the Moon during a recession .
Even the last GFC didn't stop property climbing in the longer run. It's much more than doubled.
I got into crypto right before the 2018 crash. I remember sitting at work laughing with a friend of mine about how we were watching our money evaporate before our eyes. I fucked up and didn't keep buying but I didn't sell either. Sadly, I had a big bag of $1.70 Cardano, $2.00 XRP and .7 ETH and two LTC so my holdings were definitely not making me rich this time around. I got back in around jan. 2021 and have since made some money from my investments (I'm not crypto rich) and I continue to DCA. There will always be people that predict the next big run up or some big thing that's going to move the markets. Robert Kiyosaki has been saying the sky is falling for a couple decades and he didn't even get the 2008 GFC right. It doesn't stop I don't think, but the longer the market trades sideways, there will be less of it. But to quote the great Aristotle," There is one thing that I know and that is that I know nothing."
Young enough to be tech-savvy Old enough to notice the GFC and not trust central banks
Clearly the BRICS nations would have looked at this but China at least has decided against using Bitcoin as an alternative to the USD global monetary hegemony. Instead China has since that article was written developed its digital Yuan, the DCEP. Why because perhapos adopting Bitcoin would provision a truly independent non aligned and neutral currency, but China would lose the access to the strategic power and HUGE seigniorage that is instead possible by implementing its own sovereign digital currency. China has the advantage of being the largest mercantile economy on the planet, buying raw materials and selling manufactured goods at a scale that places most of the other nations dependent upon trade with China. China has won the trade war. Now it seeks monetary hegemony, always the logical and ultimate prize of mercantile domination since the time of Rome- even Solomon! DCEP is now operational and China has recently signedf a 'cooperation pact' with Russia. Given the fragile state of the USD global hegemony and the banking system it is based upon with inflation surging and debt at unprecendented and probably unsustainable levels now is the perfect time for a joint strategy by China and Russia to seize control of both territory and monetary hegemony. Is this what they are doing? If Russia is successful, and Europes dependence upon Russian gas and oil makes it probable, the next move could be Taiwan and expansion of trade denominated in digital Yuan. China is too big for the USA to sanction- China has already been quietly buying oil from Iran for more than a decade despite US sanctions on Iran. A blind eye has been turned because China was needed to bail out the USD/IMF as signified by the IMF inviting and accepting China to join its currency reserve board post GFC. The Ukraine war might be the beginning of wider challenges to USD hegemony. Bitcoin will remain the sole neutral independent monetary alternative to fiat debt slavery, Russian standover tactics and CCP autocracy.
GFC was, 9/11 was, covid was/is, Putin being a lil’ dick motherfucker not so much
So so accurate. I'll be brief so I'll leave out a lot of detail: The Fed just does it indirectly people will say "Clearly there isn't Bitcoin on the Fed's balance sheet". The Fed can't print money either (this is technically true). PPP loans and stimmy checks that went straight into the NASDAQ and BTC, that's money printing but that required the help of the treasury. That's why QE isn't exactly money printing. The post GFC banking system is a bit crazy.
I agree with you. It is a quote from four years ago and he was particularly hung up on ‘dark web’/criminal slant. But like he and Buffet have said before they don’t invest outside their circle if competence so probably limited knowledge. It doesn’t necessarily mean they are wrong though. The rhetoric around Buffet and Munger during the dotcom boom was that they were out of touch dinosaurs, but they stuck to their guns and bought up assets on the cheap in the aftermath. Buffet was also correct in calling some of the exotic instruments being created by the banks ‘financial weapons of mass destruction’ prior to the GFC. It should maybe give us pause for thought rather than angry dismissal. But the baby analogy is somewhat OTT.
Why would that necessarily happen? When the people trust the government to step in and socialise the losses, no-one steps up to fix things or even behave responsibly e.g. GFC. When the Wrapped Ethereum on Solana Bridge was hacked a VC find stepped in to fix it at a cost of $300 million. They knew no-one else would fix the problem, and their investment was responsible so they stepped up. No one takes any responsibility when the government will bail them out. In the 20s everyone was leverage trading stocks and the banks collapsed. So even if you were prudent you lost everything. If people were self sovereign and held gold (or Bitcoin) they’d be a lot better off.
While good to see an article mention something bullish (before knowing it’s fake) none of us should actually be looking forward to hyper inflation because it means we’ve hit a deepening level of poverty. It implies more kids and more families go hungry and are displaced even further than they are from the unlimited liquidity injected since the GFC in 08-09. I never want to see hyper inflation in North America, or anywhere for that matter. Inflation alone sucks but hyperinflation naw bro. If you get pumped up off a headline like this (whether it’s fake or not) then you should check yourself, look at the countries that have gone through hyperinflation, it’s sad and the poorest people end up taking the brunt of the downside.
Maybe a silly question, but what does GFC mean?
Because it didn't happen last time they did a big QE dump during the GFC
This, but don't put all your eggs in one basket, a healthy portfolio is balanced between real estate, stocks, commodities, crypto, even some % in bonds is a good idea for when the market shits the bed like GFC in 2008 so you can flip the bonds and grab some cheap stocks.
i got got scuffed up from the GFC. fucking derivatives. yet another reason - who the hell needs them and all the other noise we get? I think stocks will eventually settle around 10X earnings and have to pay a real dividend just to keep investors interested. Gold? Are you kidding? Diamonds? Maybe we'll keep them. i'm a fan of capitalism mostly, but if this kills the laissez-faire aspect a bit, great.
When house prices crash, no one sells, we've seen this in the early 90's and the mid 70's. I don't think the above posters are thinking rationally. Like you said, if the house prices crash, it's such a house of cards it'll make the GFC look like putting a tenner through the wash.
Not foolproof, but by God ditch the big banks and use a credit union. They may capitulate, but it will be well past Chase or BoA. After the GFC, why would you lend (deposit) those thieves your money?
Crypto is inherently political. It was created out of the cypher punk ethos from the ashes of the GFC. Everything about its origin and purpose are political. Crypto without that mindset just becomes PayPal.
What are the economic signs? You mention an asset that’s gone up (housing prices) and you seem to be overlaying the experience from GFC (2008-2009) into your forecast. The rise in home prices this time around is vastly different from 2008 and mortgage lending has been very constrained without the ridiculous lending standards of 2006-07. Consumer balance sheets are the best they have been in 40+ years and they are just not primed for catastrophe. Sure what comes up can go down but you are describing a collapse. The economy does not appear weak, financial markets are weak as a result of having to price in the fact that the fed has switched from very easy to more hawkish.
I just think that prices can decline and dont need to fall off a cliff. I agree that we are due for a correction with rising yields but it doesnt need to be dramatic. And one thing to keep in my mind: the central banks‘ reaction function has ultimately changed after GFC, if things get really ugly, they step in printing money. Now you could argue that this makes things even worse and in the long-run you might be right. Let‘s see how this will play out. I am keeping a close eye on how DeFi is coping with it and so far I have to say that despite all collateral liquidations (Aave, Maker, etc.) things have been working really fine. That is a bullish sign to me. All the best and good luck investing/trading
How would crypto have changed the GFC or the COVID stimulus that almost every country worldwide has been involved in?
These kinds of posts look very much like they have some actual analysis behind them, but they don't. There is no discussion of the actual monetary policy or economic situation we are in right now. MMT wasn't even being used prior to the GFC (it was used in response). MMT is essentially the idea that you can print money as long as inflation remains under control. This post is essentially no more than TA with some history.
Lol, imagine pointing at the dot com bubble and the GFC and saying…”big shit every 10 years” It might happen here, but the macro elements that are in play now versus what causes those…just wow.
Printing of money via extremely low interest rates has been in full effect since the aftermath of the GFC, they have never returned to pre GFC levels. Unfortunately then came Covid and the fed had nowhere to go but further down. Where did these development firms and developers get their money from? They borrowed it at 2.4% haha! You think these guys use their own money? LOL. The fact is the US and other country’s never got their books balanced after the last hit and were ill prepared to deal with this one. Economics 101, as interest rates are reduced, more people are able to borrow more money. The result is more money to spend. This causes the economy to grow and inflation to increase. https://money.cnn.com/2016/09/08/news/economy/central-banks-printed-nine-trillion/index.html
Everything is crashing and a GFC event is ripped to happen. LRC is just a peripheral idea on the edge of the hurricane now. I just wish I'd bought mine later on.
Don’t think BTC will ever completely die. But a recession to the same magnitude and severity of the GFC would probably destroy BTC’s prices
Down 10 to 12% I think your adviser is lying to you about the severity of the GFC to get your business I was invested during the gfc through a financial advisor and let me tell you it was over -40% with a medium risk portfolio
Yes. The ones the Feds chose to support with the peoples money of which a large portion then went into the hands of the bankers. The very same people who caused the mess in the first place. You probably already have but if you haven’t watch the movie and read the book by Michael Lewis, The Big Short. It’s mind boggling what these fuckers will do to line their own pockets at the expense of everyone else. I do agree with you though about the markets always coming back. They do, although after 2008 it took a fair while before they even reached the highs previous to the GFC
Yes much worse. He has sugar coated the GFC
It's up to the OP to evaluate their risk. But what I'm saying is don't assume crypto lives in a vaccuum or insulated from other events. If the rest of the economy tanks (and there is plenty of speculation about a correction, before all the geopolitical shenanigans are taken into account) there could be very real risks that could reach into lives such as redundancies, downturns and closures. Take the time to figure the risk holistically. And I freely admit I'm thinking of these risks through the lens of 80s recessions and 20% interest rates, living through the dotcom bubble, a GFC and a myriad of personal ups and downs: Those experiences do make one somewhat more cautious (and there are +ve and -ve views on that which are both valid). I think this can be summed up with the old proverb: "Trust in Allah, but tie your camel to a tree."
What's a GFC? :) All I could come up with is Grand Frost Cataclysm
Crypto has never been through a GFC Institutions only have 10% of the available BTC supply and they'll dump it quick fast like they do with stocks if the have to. A recession would change things massively
Your entire theory is based on the fact that international governments banning crypto is the only driving factor behind the price. This is obviously horribly incorrect. The housing market is unsustainable at the moment. We haven't seen conditions like this since 2008 GFC. Evergrande is still a problem. The stock market is tanking ATM I think we have much further to fall.
We are on the verge of another Global Financial Crisis, what if it happens in 2022? Bitcoin was created **because** of the last GFC.
> GFC: Moody's to pay $1.1 billion to settle claims it inflated ratings in lead-up to financial crisis https://www.abc.net.au/news/2017-01-14/moodys-agrees-settlement-over-pre-gfc-ratings/8182694 The biggest fraudsters who were behind GFC were the rating agencies Its incredible these scammers are still in business. And not only are they still in business, but their business is much better than ever before. This is the legacy finance system for you.
We did completely fine in Australia during the GFC. Maybe America has a lot more that it needs to sort out besides currencies.
To be honest I don’t really see what crypto has to do with the events of the GFC/Big Short at all? How does dodgy risk assessment with an asset bubble tie into crypto?
Bro because the world changes and improves all the time. Germany's hyperinflation was before WW2... recent examples of hyper inflation are Zimbabwe and Argentina both with very poor political structures. Its like saying a banking crisis is around the corner because look at what happened during the GFC. Completely ignoring the huge amount of regulation (capital / liquidity / remuneration / culture) that has been introduced to ensure a GFC will never happen again. It doesn't make sense to compare "the norm" to individual countries like Argentina. Its such a flawed argument. Thats like me saying, don't worry we don't need crypto to manage inflation because look at Japan where they had 20 years of stagflation...
It seems it does: ​ "Second, the Fed might apply the textbook reaction to inflation.4 That is, tempted by faster output growth and elevated inflation, it may decide to hike rates in 2023 or even as early as 2022. However, if this happens, inflation might very well accelerate instead of falling. Higher rates and a steep yield curve will reduce demand for cash and push money from short-term deposits to longer ones. As banks benefit from the level and steepness of the yield curve, they will be incentivized to lend more. Longer-term financing coming from the increasing tenure of deposits will facilitate this move. As the loan-to-deposit ratio is at its all-time low, there is an ample amount of liquidity to lend once the system gets unclogged with higher rates. 5 Policymakers may interpret this reaction as an effect of insufficient rate hikes and continue increasing them.6 Higher interest costs will eventually limit companies’ willingness to invest and consumers’ propensity to spend, thus weakening the financial standing of both. Worsened growth prospects will likely lead to a crash on financial markets and end the currently blooming wealth effect. The resulting unemployment and depressed sentiment will negatively impact consumption and investments, further lowering money velocity and demand for credit. Rate hikes will stop inflation but not in a way anybody would desire, especially shortly after recovering from the pandemic. Then the Fed would presumably reintroduce UMP, and the economy would return where it has been trapped since the GFC–to a state of low inflation, subdued growth, and suffering productivity." ​ [https://www.atlanticcouncil.org/blogs/can-interest-rate-hikes-accelerate-inflation/](https://www.atlanticcouncil.org/blogs/can-interest-rate-hikes-accelerate-inflation/)
>Before I continue there is a myth in crypto that regulation is bad. This myth stems from the origins of BTC as in the GFC it was the actions of regulators and institutions that created the crisis. BTC (and crypto eventually) being promoted as an alternative decentralized solution to the corporate greed and corruption that had shackled the world in debt. But this narrative is horse shit! This series has shown that at least 50% of the crypto market is controlled by less than four companies. Ifinex, Cumberland, Alameda and Coinbase. With even BTC now under the influence of [BTC Mining Council](https://bitcoinminingcouncil.com/) ( which includes Micro-Strategy) and [Blockstream](https://blockstream.com/). When the supporters of a lack of regulation in crypto shout about free markets and individualism. They may believe they are standing up against the faceless bankers coming for their crypto. While not realizing that they are in fact defending 26 unknown people in the Bahamas ability to print $2.5 billion in a week. Their own exposure to financial manipulation by influencers and leverage trading. But as I've stated before this the PSYOP nature of crypto You say that regulation in crypto is good and the "regulation=bad" narrative is bad without providing evidence as to why we need regulation. Crypto is not "controlled" by these corporations, they cannot decide what technology goes into Bitcoin,create more Bitcoin or make people sell their portfolios, that's entirely on the people, they're the ones who sell once the price goes lower. Stablecoins like tether are a problem, but coins like UST can keep themselves regulated without the need for a regulation.
Which will be first: ETH 2.0 or GFC 2.0?
"Quantitative Easing" is what they called what were essentially negative interest rates and they did it for a few years during the GFC Afaik, Japan has been doing that for quite some time
A negative interest yield generally means there are issue with deflation in the atmosphere. The amount of liabilities in the system outweigh the net investment(new money) coming into the system. The only way for the two things to clear is negative rates. Not enough spending in the economy. it's a failure of policy but it's I don't think most crypto people understand the circular point of bank money. You are ultimately meant to spend money and more importantly banks need to lend money to people. When banks don't lend to risky ideas, the gov hates to spend and people don't earn enough it leads to negative rates. Some crypto like Bitcoin is horrible alongside debt. It's natural rate of interest is deeply negative. Stable coins are a bit better but they have a peg that is pretty unstable without some pretty risky and illiquid stuff backing it but the winners of the stable coin will slowly have less risk and lower yields as people pile in(which is a good thing) They are essentially a form of bank that is willing to lend to some risky shit(also a good thing) and imo the biggest winner of crypto will be the defi market long term, many of the early coins will become digital commodities but of little interest to the actual monetary system much like Gold prior. The new eurodollar credit system if you will. Stable coins can bridge that gap a little like the MMF of earlier, but they carry the same risk of breaking the buck and I feel that the gov won't be as keen to bail crypto out as an I told you so kind of moment. We have a malfunctioning monetary system since 08 and the risk is always towards deflation more then inflation. GDP growth was faster out of the great depression in 14 years then it was out of the GFC for America for instance. People love to complain about inflation but stable coins are literally new money being printed. All crytpo is. If I create a stable coin that is linked to a dollar then I have created a new dollar into existence. That's inflationary and I think a good thing. We been in this deflationary low investment funk for too long.
Raoul Pal been saying a similar thing the past year and that’s why he’s all in on crypto. Basically BTC (and other cryptos I presume) is the only asset class that has outpaced the central banks balance sheets. Since the GFC. It’s sad really that people with no compounding or cash generating assets (95% of non home owners) don’t even see themselves getting fucked in every hole. They just keep clamoring for more stimulus and the politicians are happy to provide.
According to Bitcoins white paper, it was designed as a currency that eliminates centralisation in the economy. This will prevent fraudulent activity by the big banks and to prevent another GFC. The monetary policy of Bitcoin prevents it being used a currency until the market cap is either large enough for price stability, or that markets are rational to prevent boom bust cycles. I don't believe the latter will occur. XOR token has been designed based on scientific research to be used as a currency to resolve these issues Bitcoin and other cryptocurrenies have. So why own XOR? The very same reason people purchase Bitcoin. They believe it will be accepted as a currency and that it's purchasing power will increase, just like XOR.
> Please explain how real estate and stock market prices crashing leads to "mass unemployment" I'm guessing your age is somewhere between 18 and 25 because it sounds like you didn't live through the GFC.
It’s obvious there is too much focus + dependency on central banks given how much discussion there is about them. They should be like good referees - unnoticed. They were decades ago but that changed post tech bust and GFC when they stepped in to juice growth / prevent deflation.
Change starts with the outliers and the moral outrage started with some of them long before 08. Everyone today talks about the GFC being the big event, but blowing through so much money in the aftermath of 9/11 on Wars and DHS is what allowed the bubble to be blown in the first place. See the Milgram experiments if you want to know how few people have a moral backbone in the face of authority. Nine out of ten people only really care when it hurts them. Far fewer than one out of ten are capable of understanding how the existing financial system works much less what an egalitarian financial system would like like in comparison. Bitcoin is the culmination of a century of work from the few intelligent people that won't harm someone else simply because an authority tells them they have to for the greater good.
>This argument is equivalent to a teenager saying get out of my room to their parents. The Fed literally prevented a global depression back during the GFC You mean when the actual working people were completely fucked over while the financial institutions that caused this financial crisis and economic recession for the next 3 years that changed literally nothing and we're now in the exact same position got bailed out and gave themselves big bonuses as a reward with the bail-out money? That was the moment where we had a chance to cut off the cancers that are causing every so many years a full on financial crisis. It would mean taking a big loss but in the long run would serve a better purpose. Fine and Jail those who are the cause, do not bail them out. Eat that big bullet and as a reward you free yourself as a government and a people from the financial institutions who enslave you and your political system. You might be more poorer, but by god do you get a good well night's rest knowing the scum are behind bars for long periods of time and don't get to see a single penny from you or from the profits they made. Knowing that in the end, you can't fuck everyone over and get away with it scott free. That there's still some justice. But there is no justice. And that's why I went to crypto.
This argument is equivalent to a teenager saying get out of my room to their parents. The Fed literally prevented a global depression back during the GFC. So yes, we need a central bank. As for debt, so what? Treasury borrows from the Fed. Treasury uses that debt to put money in people’s pockets, people spend the money in the economy. Rates are low. We service the debt, economy grows. Money is just accounting. Just like a token in crypto. An economy is goods and services. Everything else is just numbers on a screen.