For several months now, voices have been raised among renowned economists around the world calling for a Great Reset of the current monetary and financial system. The International Monetary Fund (IMF) itself recently called for a new Bretton Woods. What these people don’t realize is that the Great Reset of the current system has already started on January 3, 2009 and is embodied by Bitcoin.
At the beginning of May 2020, the macro investor Paul Tudor Jones had officially taken a stand in favor of Bitcoin in a letter sent to its investors. Paul Tudor Jones explained that he now favored Bitcoin over gold to protect himself against the large monetary inflation that was starting.
If the term large monetary inflation immediately spoke to investors of all kinds, whether they are in the stock market or in the world of Bitcoin, a majority of people in the general public did not really understand what Paul Tudor Jones was talking about.
The great monetary inflation that Paul Tudor Jones was talking about at the time is one that continues to this day.
Big money inflation hits the world more than ever in 2020
It corresponds to the measures taken by the Fed and other central banks to tackle the economic crisis triggered by the COVID-19 pandemic. In a few weeks, these central banks printed the equivalent of 12,000 billion dollars fiat money.
To give you an idea of what this means, imagine that your bank account now shows the amount of 1,000 €. And then, as if by magic, the next day it suddenly displays 1,001,000 €.
Your money would have been increased by + 100,000% with the wave of a magic wand.
When you hear about health programs quantitative easing led by the Fed, the ECB, and the other central banks, that is exactly what is happening. By a simple decision of a few central bankers who are not representative of the people, the money supply in circulation suddenly increases.
At the level of the US dollar, the money supply in circulation is represented by the M2 Money Stock indicator. Between March 2020 and September 2020, the M2 Money Stock increased by + 21% from $ 15.512 billion to $ 18.720 billion:
This high monetary inflation favors the explosion of public debts
This unprecedented increase in M2 Money Stock in such a short time has allowed the United States government to take on huge debt to fund a stimulus package that will not be enough to help those who need it most.
While the US public debt is close to $ 27 trillion, the situation is still bad for the US economy.
A new stimulus plan will have to be voted on by the end of the year. It will bring America’s debt closer to 30,000 billion dollars. America’s debt has been growing faster than the economy for years, but now it’s growing exponentially:
The situation is the same all over the world. The US dollar being the world’s reserve currency, the United States exports its inflation.
In total, global public debt has increased by 15,000 billion dollars since March 2020. The current monetary and financial system has never been more in danger than it is today because of the original sin of allowing central banks to print ever more fiat money out of thin air.
From this sin follow then seven other deadly sins that will sooner or later cause the loss of this monetary and financial system.
The problem is that all the money created stays in the hands of the richest people
For the populations, the great monetary inflation is dramatic. All printed money remains in the hands of 1% the richest as shown by the vertiginous drop in the velocity of the M2 Money Stock, which is at a low since the 1940s:
As a reminder, a high velocity of the M2 Money Stock means that the money passes quickly from hand to hand, and therefore that the US economy is dynamic.
This lowest velocity is confirmed by the fact that America’s largest fortunes have increased by more than 500 billion dollars since March 2020. The actions of the Fed have benefited a tiny minority with in symbol a Jeff Bezos who became the first man with a fortune of more than 200 billion dollars during the summer of 2020.
The problem is that money creation is in the hands of governments
The situation we are experiencing in 2020 shows once again that the US dollar, as well as all other fiat currencies, are weak currencies.
The main problem was already pointed out by the economist and philosopher Friedrich hayek in 1984:
“I believe that we will never have good money again until we take money out of the hands of governments.”
For Friedrich Hayek, the problem is the power to give to central banks and governments in money creation. Total power that doesn’t need to be.
For him, monetary creation should not be the domain of the State, because this leads to these situations of high monetary inflation:
“I don’t think it is too much to say that much of history is about inflation, usually inflation designed by governments for the benefit of governments.”
Governments abuse monetary inflation for their own benefit.
A Great Reset is necessary, Bitcoin embodies it perfectly
The solution is a Great Reset of the current system. This Great Reset is being called by more and more economists around the world. The International Monetary Fund (IMF) has just called her wishes. What these economists fail to understand is that this Great Reset started on January 3, 2009.
This Great Reset is embodied by Bitcoin, which is the best alternative to the failures of the current monetary and financial system.
Bitcoin has several major advantages:
- A maximum offer limited to 21 million units whatever happens.
- A programmatic monetary policy that does not depend on the arbitrariness and corruption inherent in human beings.
- The absence of a leader implies that Bitcoin belongs to the people as a whole.
Bitcoin is sort of the answer to what Friedrich Hayek hoped for throughout the 70s and 80s.
This answer was created by Satoshi Nakamoto following the 2008 banking crisis, which once again showed that the current system was reaching its limits. Twelve years later, a new economic crisis highlights the inescapable side of Bitcoin for a better world for all when it comes to money.
Meanwhile, the Bitcoin market cap has reached 250 billion dollars, and its price close to $ 14K.
More and more people are realizing that the Bitcoin plan is our only chance to perform that necessary Great Reset. In the next great economic crisis, which will take place 10 to 15 years at the most, the price of Bitcoin will likely be closer to a million dollars than zero, no matter what its detractors.
The big question is to know if you will be among those who will have embarked on the train of the revolution as soon as possible to benefit from it to the maximum. It’s up to you to decide knowing that it is by educating yourself that you will be able to make the best decisions for your money future.
A developer by training, I discovered Bitcoin in 2014 but did not immediately grasp the importance it could have for the world of tomorrow. I took a more in-depth look at it from the start of 2017 and I haven’t let go of it since.
Passionate about Bitcoin and the new system it is trying to build for the future, I decided to participate in its evangelization at my modest level by writing about Bitcoin, Blockchain and cryptocurrencies in different media.
It is with pleasure that I publish some of my texts in French on The Coin Tribune.
I also write a lot about personal development and self-improvement.
Please feel free to connect with me via social media or in comments on my articles if you have any questions regarding my articles.