Bitcoin Back at the 10-Year Support Line

Dominoes Lined Up and Falling

ES traded down to a support level this morning. THe Dow Jones Industrial Average lost the 1929-2000 trendline. Palladium is threatening a top completion and breakdown.

Binance is in trouble and it is the market:

Platinum:

Nailing the Analog: MicroStrategy Sued Again

District of Columbia Suing MicroStrategy Founder Michael Saylor for Tax Fraud

The District of Columbia is suing MicroStrategy (MSTR) founder and executive chairman Michael Saylor for allegedly never paying any income taxes in the district in the more than 10 years he has lived there, Attorney General Karl A. Racine announced in a tweet on Wednesday.

In addition, Racine tweeted that his office is suing MicroStrategy “for conspiring to help him evade taxes he legally owes on hundreds of millions of dollars he’s earned while living” in Washington, D.C.

See this post for my discussion of MicroStrategy as a cyclical signal: Cycles: MicroStrategy Back Again. A stock that was a brief darling of the 1990s dotcom bubble, then crashed amid accounting troubles. It hibernated for 20 years, then returned for a brief run during the cryptocurrency bubble and is in legal trouble again as the bubble bursts. Amazing. Little hints of history rhyming are sometimes far more information laden than they appear at first glance.

BTC WAG for the Win

Going through old BTC posts. I did this one in January. The path of BTC was pretty close to my guess. It was over $40k at the time and I was looking for a move to $30k.

In this post from May 2021, I said my first target was $20k. That could be hit today. BTC Waterfall Decline Approaches

$30k was a tradable short-term support level

$20k is firm support for a major correction

$12.5k to $15k is support for a BTC bear market

The plunge to this point was through a low volume area. A symmetrical drop similar to the spike up in December 2020. There is support at $20k and I expect dipbuying will kick in.

Cryptopocalypse Returns and Apocalypse Now for Stocks?

Ethereum tagged the major support line I mentioned yesterday:

BTC also lost support but hasn't taken out the prior low yet.

Back in December 2021 I posted on Solana, a hot crypto that did a 500x from 2020 to 2021. I wrote:

Blue support broken. Take out green and I'm looking for $80, with $50 and $20 lower targets.

June 2022: $20 incoming.

All signs point to an open door for major bearish moves in crypto and stocks. There is one trader out there arguing for temporary bear squeeze though:

yes I think BTC is at the yellow circle, tagging the neckline ... There may be one last bear market rally before complete annihilation begins. pic.twitter.com/P7n47UFjeu

— xTrends (@xtrends) June 12, 2022

He is also looking for SPX to bounce to 4100 by next week possibly, plus an eventual move to 4300 before it goes down tubes. He has been right more often than not. If he's right again, the stock market should either move up overnight or capitulate on Monday or Tuesday, with cryptos following. If he nails this call perfectly, he will achieve legendary status if he doesn't have it already. 

I suspect the biggest risk for his forecast is that the capitulation move hasn't completed and may see far larger drop into Monday and maybe Tuesday. As I wrote yesterday, my pit stop target of $370 on SPY would probably be hit in the next day or two if selling momentum continued into this week, even if he's right about the eventual move this week. I'm open to all scenarios. I think the big money trade, assuming he is correct about capitulation, would be to catch that bottom and ride it back up. If there is more dip first, the rebound will likely be even faster.

Finally, stocks "should" fall here because all these late bulls are realizing they've been wrong all year. Yet, the Johnny-come-latelys selling stocks here are six months behind the curve. The forward looking trade is selling energy stocks because everyone realizes either recession or central bank policy will start lowering energy prices (and eventually prices throughout the economy). Or buying the capitulation dip. Falling energy prices was one of my bear market rally keys, along with a bounce in bonds. If a trifecta unfolds where all three are behaving as I anticipate, I will have confidence to place large leveraged trades. One way or another, this is going to be a crazy week.

What is Modern Conspiracy Theory?

My view of modern conspiracy theory is that is more of a orientation than a specific plot. "Conspiracy theorists" don't necessarily believe in specific conspiracies (although many believe in them all) as much as they believe there is an overarching conspiracy to some degree. A quick example: I don't believe in weather modification conspiracies. I don't think the technology exists. Cloud seeding exists. Weather experiments, even extreme attempts like HAARP might exist (although I don't believe that HAARP was a weather project), but they aren't successful. Natural history and cycles of climate explains everything weather related. 

Are a global elite plotting world government and takeover via claims about climate change? Absolutely. Are they faking the weather to do it? No, because it's not necessary. They have fooled the world with "science." Many "conspiracy theorists" believe in ludicrous conspiracies and ideas, sometimes to their own detriment. Yet this doesn't invalidate their general knowledge of a nefarious plot at work.  

Most of the "overarching narrative" of conspiracy theory is open fact. The Club of Rome, Agenda 21 and various other books and public discussions going back to the Fabians and writers such as Aldous Huxley and Isaac Asimov have existed for more than a century. Science fiction writers openly promoted global government, rule by the scientists in their books. Elites have discussed "problems" such as overpopulation for decades. I put problems quotes because one of the tricks of the trade is to take something that in extremis is obviously a problem, but isn't actually a major problem. As they do with CO2 emissions and the novel coronavirus.

In sum, I'm a believer in the weak form of conspiracy theory. It's an open, self-organizing conspiracy. It moves very slowly. Like one of those optical illusions that show a 3D image if you stare through it, it looks like a bunch of dots, a jumbled mess, if you don't know what you're looking at. At every step of the way, you're a "kook" for saying this is a conspiracy or part of a larger plot. Only by looking at the whole picture, the shift in policies over decades, can one see the sum total of it.

Vox Day is a strong form believer. In They Called Their Shot he writes:

It doesn’t really matter if the satanic elite of Clown World are divinely bound to announce their intentions or if they are simply narcissistic psychopaths who revel more in the knowledge that they are getting away with their wicked deeds than they do in the deeds themselves, the simple fact of the matter is that they do announce their future intentions, albeit always in a manner that provides them with plausible deniability both before and after the fact.

This X-Files episode is not an accident. This is not an astonishing coincidence. This is how, and why, it is relatively easy to interpret current events utilizing well-informed conspiracy analysis. Even when this episode was first broadcast, I immediately noticed the expositional clumsiness and contemplated the possibility that it was blown cover as cover, although I must admit that I forgot about it as time passed. But it was not the only such announcement. This habitual revelation under the cloak of fiction is another reason why anyone who submitted to the vaccine – which I will remind you was relentlessly pushed by international corporations and global depopulationists – was not only blitheringly stupid, but required almost wilful ignorance to do so.

We were warned. We were repeatedly warned. And I can assure you, it vastly amused the wicked of Clown World to see how many of us flat-out refused to believe their repeated warnings. The truth really is out there.

In the end, it doesn't matter if the writer of the X-Files was compiling the openly available information for the show or if it was more of an intentional announcement of future plans. The fact is that, as Vox says, the truth really is out there.

His post was based on the series finale of the X-Files, aired in 2002. Conspirators infect the public with a DNA-altering substance that disables their immune system, rendering them vulnerable to all manner of illnesses. In the show, it was done via the smallpox vaccine and assumed to be heritable. In 2020, govt/media nurtured mass hysteria. Inconvenience created by travel and work restrictions caused hundreds of millions of people to infect themselves with experimental mRNA shots.

Depopulation is a stated goal of a major faction of the ruling class. Feeding children hormone blockers eliminates reproduction. Feminism ("working mothers") reduces fertility. Making real estate more expensive, making life in general more expensive, depresses fertility. Abortion reduces the population. Contraception reduces fertility. Urbanization reduces fertility. Are all these policies part of a vast conspiracy? No, but the faction of the ruling class that wants depopulation greatly encourages all of these ideas. Drawing the line between what is intentional and happy (for them) coincidence is a mostly pointless exercise. A more useful question is, what wouldn't they do? Would they pump a deadly or fertility-reducing agent into the general public? Strong-form conspiracy theorists think yes and most if not all of them didn't get the mRNA shots. I didn't get the shots because I thought the risk/reward didn't make sense. I assumed the shots were riskier than advertised and the virus less dangerous.

Other conspiracy theories are ideas such as the "mark of the beast." No one will be able to travel or shop without the mark. I remember seeing that one in the late 1980s or early 1990s on some religious show while flipping through channels. A microchip would be needed to shop or travel. China and other nations have fully implemented this with vaccine passports via smartphones. Religious people and those who read the Bible are more likely to believe in conspiracies because they believe the Devil exists.

Maybe foresighted people saw the natural progression of technology. Through storytelling, they explained how easily this technology could be abused. Combine it with stated goals of groups like the Club for Rome, it isn't hard to theorize what someone who believes X might do with technology Y or power Z. Someone with evil intent will always be looking to use power and technology for their own ends. The 2nd Amendment exists in the United States because the Founders understood all governments tend towards tyranny. It was put there because they knew their Posterity will probably need it one day. 

I worry that the blockchain will eventually become a system for totalitarian economic control. One blockchain to rule them all, and in the chains, bind them. There are groups out there already deplatforming political dissidents from banks. Researchers at Stanford (marinate on that phrase for a moment) are already discussing how this deplatforming isn't thorough enough because the banned are building their own platforms and companies, from which they cannot be deplatformed again: Gabufacturing Dissent: An in-depth analysis of Gab

Our findings document several unintended real-world side effects of the deplatforming of both users and platforms, raising the possibility that other interventions on mainstream platforms such as downranking and limiting visibility might curb toxic content more effectively than shifting the problem elsewhere. If deplatforming is deemed the most desirable solution for a given scenario, it may be that this deplatforming would need to be more thorough and widespread to be effective. Hence, more study is needed in several areas...

...For example, payment processors have already cut ties with Gab—is there more that could be done to disrupt other financial flows? Answering these questions may prove crucial to developing more holistically effective Trust and Safety practices at the platform, infrastructure, and regulatory levels.

I can explain it to you, but I cannot understand it for you. It's all being done in plain sight. You can either accept it or not. You don't have to become a "conspiracy theorist." Maybe it's all a general decline in civilization, the historical cycle with democracy collapsing into tyranny. Once you see the trend though, you'll see all the evidence in the news, in the proposed policies, in the propaganda. Some highly-placed people and organizations are helping this all along. It doesn't matter how much you believe in the intentionality of it at that point, you are a "conspiracy theorist" because you can see that events are linked. That a larger force is at work.

via GIPHY

The Mess the Federal Reserve and U.S. Government Made

With hopes of being a homeowner by the time he turned 30, Steve Jensen decided to invest $25,000 in the crypto market in the summer of 2020. It was half of his savings, but since he couldn’t afford a 10% down payment on a home in Westchester, he hoped his gamble on the blockchain would expedite the process after seeing friends cash in crypto to buy real estate.

NYPost: Young investors lose big in crypto crash: ‘I didn’t sleep for days’

The Two Paths Ahead

There are two paths ahead over the next four to eight weeks. One is energy down, bonds up, stocks up. A bear market rally. The other is all hell breaks loose. Crude breaks out, treasury bonds break down and stocks collapse.

The immediate future is cloudy because there has been no capitulation in the bear market. There has been no VIX spike. There doesn't need to be, but it is a glaring missing piece for a clear bottom. I expect a low could be around the 3700-3800 area if that capitulation comes before the longer rally. If the plug gets pulled, then it's straight down to 3400 area and then a rally.

FWIW, Xtrends thinks VIX will spike this coming week:

One day moves aren't much to go on, but crude oil broke higher. Bonds might only be pulling back within the context of a reversal. High-yield bonds did not make a new 52-week low on Friday, but came close.

BTC is right at my support line at $28,817 today. A Tehter blowup isn't necessary here, I think that could come later this year. A short-term, capitulation spike lower in stocks would be preceded or coincident with a breakdown in BTC to around $20,000 because it is believed MicroStrategy has a signficant position that will get a margin call at $21,000.

Bank run continues

Tether will be forced to sell its non cash balance sheet which is:

-u.s. treasuries (lost 30% of value from peak last year)
-mortgage backed securities (losing value rapidly)
-commercial paper (lots of chinese assets)
-other crypto (down 60-80%)

Feedbackloop pic.twitter.com/Avp4ofazIq

— IDKFA (@IDKFA3) May 14, 2022

For a plug-pull, something out of the box will be needed, such as an EU embargo on Russian oil that sends U.S. oil prices soaring. Or something that breaks the bond market, but I don't expect that because I think deflation/disinflation is right around the corner.

Cyptopocalypse: Down Go the Stablecoins

Back in 2018 there was a hullaballoo around Tether: Did Unbacked Tether Creation Manipulate Bitcoin Prices?. I wrote then (lots of details in the post if you're unfamiliar with the claim):

If this is true, it could deal a significant propaganda blow to the cryptocurrency market because one of the selling points is the deflationary, anti-bank qualities of a purely digital fiat currency. The real loser may not be cryptocurrencies however, but the exchanges. The current exchanges are a vulnerability for cryptocurrencies and a step backwards, introducing counter-party and cyber-security risk. ...The greater irony is that if this is all true, what happened to Bitcoin is happening to the entire global economy in real time. The Chinese yuan is to eurodollars as Bitcoin is to Tether.

I daresay BTC would be doomed to a guaranteed drop of 95 to 100 percent if it turns out the price is propped up by credit inflation via stablecoin because the whole rationale behind BTC has become its "digital gold" properties. While those would technically still exist, the fact that the price could be manipulated by credit inflation would make it less attractive than gold. The narrative would be destroyed.

With no central bank or government backing of any import, a stablecoin fiasco would reveal cryptos are not like digital gold, but more like wildcat banking of the 1840s.

Wildcat banking refers to the practices of banks chartered under state law during the periods of non-federally regulated state banking between 1816 and 1863 in the United States, also known as the Free Banking Era. This era, commonly described as an example of free banking, was not a period of true free banking, as banks were free of only federal regulation; banking was regulated by the states. The actual regulation of banking during this period varied from state to state.

According to some sources, the term came from a bank in Michigan that issued private paper currency with the image of a wildcat. After the bank failed, poorly backed bank notes became known as wildcat currency, and the banks that issued them as wildcat banks.[1] However, according to others, wildcat meant a rash speculator as early as 1812, and by 1838 had been extended to any risky business venture.[2] A common conception of the wildcat bank in Westerns and like stories was of a bank that left its safe somewhat ajar for depositors to see, in which the banker would display a barrel full of nails, grain or flour with a thin sprinkling of cash on top, thus fooling depositors into thinking it was a successful bank.

The traditional view of wildcat banks describes them as distributing nearly worthless currency backed by questionable security (such as mortgages and bonds). These actions ended when note circulation by state banks was stopped after the passage of the National Bank Act of 1863. Mark Twain, in his autobiography, refers to the use of such currency in 1853, "The firm paid my wages in wildcat money at its face value".

Coindesk: UST Stablecoin Loses Dollar Peg for Second Time in 48 Hours, LUNA Market Cap Falls Below UST's

TerraUSD (UST) has lost its dollar peg for the second time in three days, falling to as low as $0.65 on Monday, according to the most recent price estimates from CoinMarketCap.

As UST has "depegged," the price of LUNA, its sister token, has dropped over 44% to $35 in the past 24 hours according to CoinMarketCap.

UST, a so-called algorithmic stablecoin, works with LUNA to maintain a price of $1 using a set of on-chain mint and burn mechanics. In theory, these mechanics work to ensure traders can always swap $1 worth of UST for $1 worth of Luna, which has a floating price and is meant to serve as a kind of shock absorber for UST's price.

Luna's price decline puts its market cap below that of UST's. That potentially throws the foundation of UST's entire stabilizing mechanism into jeopardy, because it means a Terra bank run could lead to some users no longer being able to redeem their $1 of UST for $1 of LUNA.

...Today’s depeg comes after the Luna Foundation Guard (LFG) announced Sunday night that $1.5 billion of its massive bitcoin reserves would be “loaned” out to professional market makers to proactively defend UST’s dollar peg.

My gut tells me this is all a giant Ponzi at worst and a giant case of fractional reserve lending at best. Money market funds "broke the buck" in 2008 and the financial system almost crashed. This is like the dark days of September 2008. If you forget what was going on at the time: I do believe 2008 was hyped as a crisis, as are all crises, but the question for crypto is, why wouldn't the government hype this too? Why would they stop a run on the crypto exchanges and stablecoins? I think they'd fan the flames to burn the competition to the ground.

How much of the system is backed by BTC that can itself collapse? I'm not worried about a single stablecoin going down, I'm worried about a systemic run on the entire industry if BTC is propping up multiple stable coins (as I suspect is the case with Tether).

We have never witnessed a sustained bear market and recession in the age of crypto. The last honest-to-God bear market was about 40 years ago. Every one has been bailed out. If inflation stays high though, the Fed's hands will be tied. It won't matter even if they try to help. Lending rates will keep rising, meaning debtors who need capital will go bust if they cannot finance those ever rising rates of interest. If they're backing their own assets with BTC...there's no central bank issuing BTC to stop the collapse the way the Fed can issue more FRNs to banks...and while they probably could bail it out if they wanted to, I'd bet USG would rather see all the private cryptos fail and then unveil the central bank digital currency or US Treasury Coin. Update: Here's UST/USDT

Great Signal for a Top: MSTR Doomed Again

I've had a very nice year shorting growth stocks and assorted trash. Microstrategy hasn't cratered yet, but it figured into the overall picture.

Cycles: MicroStrategy Back Again has all the info. MicroStrategy stock soared into the top of the dotcom bubble, they bought a Superbowl ad, and then they imploded on missed earnings and restatements. At the top of the crypto bubble, CEO Saylor has even more attention than he did in 2000, the stock performance is similar and the stock itself is supported by a similarly flimsy model. In 2000, they were hit along with the sector when regulators became critical of their accounting practices. This time there isn't any claims of fraud or skirting accounting rules that I've seen. Instead, it's a straight leveraged fund model. MSTR issues debt to buy BTC bitcoins. If BTC goes up they make money. If BTC goes down?

MicroStrategy Announces First Quarter 2022 Financial Results

Loss from Operations and Net Loss: Loss from operations for the first quarter of 2022 was $170.0 million compared to $183.2 million for the first quarter of 2021. Net loss for the first quarter of 2022 was $130.8 million, or $11.58 per share on a diluted basis, as compared to $110.0 million, or $11.40 per share on a diluted basis, for the first quarter of 2021. Digital asset impairment charges of $170.1 million and $194.1 million for the first quarter of 2022 and 2021, respectively, were reflected in these amounts.

Interest rates are going up and MSTR has impaired its balance sheet. All it would take to crater MSTR's stock is a drop in Bitcoin. It doesn't have to go to zero either, any substantial drop below their buy price will hammer their balance sheet. In fact, if BTC loses the $24,000 level which is all but assured in my opinion:

MSTR in 2000. Pay attention to the blue horizontal at the gap.

Here's a zoom out and then zoom in to now.

I see stock price history repeating. How about you?

Another Deflationary, DXY 160 Moment Begins

Going back a decade or more, I've been blogging about the possibility of yuan depreciation, that the yuan can fall. That the global financial system burns from the periphery to the core. Think of the Exeter pyramid: USD is above other fiat and gold above the dollar:

A dollar crash scenario involves blowing up all fiat simultaneously.

No country wants reserve status and no fiat currency can take the place of the U.S. dollar.

The U.S. dollar supply expands with credit growth, it is the base of inflation.

If the world is rapidly inflating with credit growth, USD should fall. The dollar normally falls during economic booms for this reason. Nearly everyone wants a weaker dollar.

Most countries inflate against USD.

To get an isolated crash in USD where it collapses far more than foreign currencies requires removing the US economy from the world, via civil war or something similarly disastrous like a communist revolution.

In conclusion, falling USD is the system working as intended. A dollar-centric crash is highly unlikely. If the dollar implodes, all fiat implodes with it. The system survives, one could imagine all exchange rates stay constant, but all fiat is now worth far less compared to gold, oil and so on.

To destroy up the system requires breaking it. Extinguishing credit money and making USD fail to function.

Rising USD causes credit defaults and devaluations of foreign currencies. No govt wants this.

Devaluation wipes out foreign debts, cleans the balance sheet of non-USD economies.

If USD is still rising, defaulted countries must issue debt in local currency or some alternative money.

Default in one nation creates contagion that spreads to more nations.

The euro is an artificial currency with no national backing. The yen has inflated credit more than any developed nation on Earth.

China's financial system requires U.S. dollars and it has inflated as much as the US relative to the economy. It has a closed capital account to keep the currency from collapsing.

The path to the dollar losing reserve status flows from a deflationary collapse that wipes out Japan, Europe and China's credit bubbles.

These nations would be "freed" from the dollar at that point if they wish.

The US would become the most indebted nation in the world, with an unsustainably high currency. It could not afford to bailout Japan, China or Europe even if it wanted to.

The US economy would collapse along with the world economy.

At this moment, the U.S. will either let a 1930s-style deflation wipe out the debt, saving the dollar as a currency, or it would actually press CTRL-P. Not swap debt for debt like with QE, and not issue treasuries, but instead the U.S. Treasury would bypass the Fed, directly print fiat dollars into the economy and reflate the system.

The path to a collapsed dollar goes through DXY 140 or maybe 160 or higher. The higher DXY goes, the more likely and more spectacular the ensuing inflation/collapse. DXY 120 would probably constitute a near miss that causes a bigger panic than 2008 and bear market on par with at least the doctom bust of the early 2000s.

Almost everyone in the world is on the wrong side of this trade. They don't believe it can happen or don't expect it will happen, or they are too large. A billionaire cannot preserve their wealth, only their assets. Maybe Bill Gates understands because he's been buying up farmland. Wealth based on numbers will evaporate. Wealth measured in physical capital: farmland, oil wells, factories and so on, they will retain relative value in the transition. Gold and crypto are there for preserving some "number" wealth during the transition. The wealth gap will close because poor people with nothing will still have nothing, but everyone counting wealth in digits, in things like stocks, bonds and so on, will see their wealth converge with zero.

This is an extreme outcome if a series of events keep triggering. A lot of dominos have to fall in the same direction. China housing bubble has to burst for example, something they've avoided several times the past decade. Even if all these dominos start falling, the trend can be aborted at any time by governments doing good things and more likely, doing bad things. Wars could halt the deflation and cause inflation. But this process is getting started again and knowing how these dominos fall will keep investors one step ahead of what will largely be clueless competition. Most investors do not think any of this is possible. They think dollar devaluation is inevitable. 

Even if all that happens is another mini-cycle like 2014-2016 and 2018 kicks off, most are wrong footed. Stocks will crumble, bonds rally. Things like gold and crypto fail in lower order versions of these events and then experience explosive rises in extreme, system-breaking scenarios. Crypto is far more vulnerable to losses than gold, a reflection of its speculative rise. If all that happens is a bear market, cryptos and NFTs could lose 90 to 100 percent of their value. 

Cryptop

USG Deplatforming at Home and Abroad, Building New Al-Qaeda for Domestic War on Dissent

Russia is weeks away from having its aviation industry grounded because it cannot obtain parts for planes or pay landing fees. Traders refuse to buy Russian oil because they fear falling afoul of a fluid sanctions regime. What is technically legal today may be illegal tomorrow. Who wants to be caught owning an oil tanker filled with Russian oil that is banned from sale?

Private companies are getting in on the act along with sports leagues. Formula One permanently cancels Russian Grand Prix

On Wednesday, the FIA ruled that the contract for the 2022 race had been terminated for reason of force majeure as a result of Russia's invasion of Ukraine. The FIA also banned the display of Russian and Belarusian flags and symbols, along with the playing of their national anthems, at any event under its jurisdiction and suspended its sanctioning and funding of events in both countries.

Apple halts sales in Russia, bans propaganda apps over Ukraine war. Google and Apple also banned their payment systems, creating havoc.

Violence against ethnic Russians and anything remotely Russian is also now greenlit by the Baizuo regime.

It is actually horrifying how conservatives and liberals were so quickly and effectively programmed by Marvel movie themes into supporting escalation with Russia and now even attacks on other Americans who happen to be Russian

Remember: you weren't even allowed to say "WuFlu" because it was basically violence against Asians

But let's make it policy and culturally acceptable to discriminate against Russians in America to OWN Putin

"The vandals broke windows and spray painted 'anti-Russian' writings on the building, police said. It was unclear how many people may have been involved."

That's fine because Russians aren't POC *and* they're all related to Putin, basically not human

The analogy of the red pill and blue pill is apt. You can either see the regime taking shape in the United States or you cannot. Many people who recognize how evil it was to unleash the Department of Justice and FBI agents on parents upset with their local school boards allowing rapes in schools, teaching racial hatred and implementing abusive masking policies suddenly dumped all this knowledge down the drain when the target shifted to Russia. The same institutions used to crush American dissent was weaponized to maximum effect against Russia.

What is being done to Russia today will be done to Americans tomorrow, indeed it has already been done to a small segment of dissidents by payment processors, by Google, Apple, Paypal, Mastercard, Airbnb and so on.

Russia can resist deplatforming because it is a nation. It can build its own systems and operate independently. Nuclear weapons should, but I sense won't, prevent USG from eventually attempting a genocidal war on Russia. It has allies though. As long as China doesn't abandon Russia, it should survive and maybe even thrive.

American dissidents though? They have no nuclear weapons. They have no allies. Neither Russia nor China will help them. Indeed, Russia and China would rather let the Baizuo completely destroy the United States as a competitor than to risk "making America great again." A parallel economy is therefore a necessity. Americans need everything from basic utilities, banking and financial services, to currency and security. They must build these goods and services because without it, USG will deplatform them.

USG already launched violent pogroms in the summer of 2020. It is unleashing another on ethnic Russians today. They haven't launched violent pogroms on the core middle of the country yet because they lack the propaganda, but they are building it now. USG helped overthrow the elected government of Ukraine in 2014 (for being insufficiently pro-EU, he was a corrupt politicians playing the Russians off the EU and vice versa as he asked for more money...) with the help of literal Nazis. Now they are using their ties with Ukrainian Nazis to create an international network of "white supremacists" which they will then tie to American dissidents, allowing the full force of USG including extra judicial killings.

Last American Vagabond: Ukraine And The New Al Qaeda

Yet, this insurgency is poised to have consequences that reach far beyond Ukraine. It increasingly appears that the CIA sees the insurgency it is creating as more than an opportunity to take its hybrid war against Russia ever closer to its borders. As this report will show, it appears the CIA is determined to manifest a prophecy propagated by its own ranks over the past two years. This prediction from former and current intelligence officials dates from at least early 2020 and holds that a “transnational white supremacist network” with alleged ties to the Ukraine conflict will be the next global catastrophe to befall the world as the threat of Covid-19 recedes.

...Soon after Russia began military operations in Ukraine, Foreign Affairs – the media arm of the Council on Foreign Relations (CFR) – published an article entitled “The Coming Ukrainian Insurgency.” The piece was authored by Douglas London, a self-described “retired Russian-speaking CIA operations officer who served in Central Asia and managed agency counterinsurgency operations.” He asserted in the article that “Putin will face a long, bloody insurgency that will spread across multiple borders” with the potential to create “widening unrest that could destabilize other countries in Russia’s orbit.”

Other notable statements made by London include his assertion that “the United States will invariably be a major and essential source of backing for a Ukrainian insurgency.” He also states that “As the United States learned in Vietnam and Afghanistan, an insurgency that has reliable supply lines, ample reserves of fighters, and sanctuary over the border can sustain itself indefinitely, sap an occupying army’s will to fight, and exhaust political support for the occupation at home.” London explicitly refers to models for this apparently imminent Ukrainian insurgency as the CIA-backed insurgencies in Afghanistan in the 1980s and the “moderate rebels” in Syria from 2011 to the present.

Indeed, when January 6th took place, no real effort was made by Capitol Police or other law enforcement officials present to stop the so-called “riot”, with plenty of footage from the event instead showing law enforcement waving the supposed “insurrectionists” into the Capitol building. This, however, did not stop top politicians and national security officials from labelling January 6th as the “another 9/11” that Neumann had apparently predicted. Notably, the DHS’ first-ever Homeland Threat Assessment, Neumann’s warning, and the subsequent official narrative regarding the events of January 6th were all heavily focused on the threat of “white supremacist terror attacks” on the US homeland.

Returning to the May 2020 Politico article – Graff notes that many supposed pandemic “experts”, which – per Graff – includes Bill Gates and US intelligence officials James Clapper and Dan Coats, had “projected the spread of a novel virus and the economic impacts it would bring as well as “details about the specific challenges” the US would face during the initial phase of the Covid-19 crisis. Graff then asks “What other catastrophes are coming that we aren’t planning for?” According to the “thought leaders” he consulted for this piece, which included several current and former intelligence officials, the most immediate “near-term threat” likely to disrupt life in the US and beyond following Covid was “the Globalization of White Supremacy.”

The black lieutenant governor of Virginia was called a white supremacist because she's allied with the white middle class that is the target of the Baizuo regime. Anyone who is not on their team will be labeled a white supremacist. Any and all links between an individual and a "white supremacist" will fall under terrorism laws, allowing the government to seize your bank account. It's all there being built in real time, out in the open and most of the people who are being targeted by this regime are cheering on their own destruction because they cannot but help to fall for military propaganda.

The Russian invasion of Ukraine is wrong. I wish the Ukrainians could win and save their country, but they will not. They will lose. This war was instigated by USG and it is going as planned. The destruction of Ukraine was caused by the United States and its European allies. The antagonization of Russia has been going on for decades and this is the result that everyone with a functioning brain predicted. The isolation of Russia was the goal, paid with the blood of Ukraine. (I have bad news for Taiwan...)

One needn't be pro-Russia to see what is being done, how the corporations and general public are quickly whipped in a frenzy of bloodlust, seeking the total destruction of "the enemy" based on propaganda and lies. It has happened several times in the past few years with different targets. Systemic racism, the police, white nationalism, now Russia. Each with varying degrees of truth behind it or none at all.

What is certain is the regime will collapse under its own weight. Even if it manages to hang on, it will be forced into sacrificing the currency among other assets that will wreck the lives of ordinary Americans. This will stir up dissent. The regime will lash out as it falls, searching for whatever scapegoat is on hand. The squeaky wheel will get raided by SWAT teams at 2am. They will find their bank accounts seized. Lawyers will be afraid to represent them. They will be isolated and alone, then destroyed as an example to everyone else.

The man who deplatforms himself cannot be deplatformed. Even without the threat of persecution, alternatives are a good idea because some U.S. institutions will fail anyway. The closure of the financial markets and banking system could be a conscious choice or caused by a cyberattack. It makes a great deal of sense to have alternative institutions that can survive.

People Cannot Imagine the Destruction Coming

FT Alphaville: Gold fetishism has had its day

Harold James is professor of European Studies at Princeton. Brendan Greeley is a PhD student there and a former FT Alphaville writer.

I normally don't include bios, but we need to start thinking tribally. What is your money?

Gold has long been fetishised in Russia and elsewhere. But the fetish of gold — Keynes’ “barbarous relic” — is the last gasp of a view that money has an intrinsic value in itself, constituted just by the fact of its existence.

Without getting into the weeds of subjective value, gold does have a value for wealth display (jewelry).

People often mistakenly see money as an asset — that’s the old fetishism. But money represents a value, one that needs to be earned. What ultimately makes a currency secure is credibility: the confidence of others. That will depend on whether a government observes laws and conventions. Money isn’t a shared illusion. It is rather a series of agreements and customs among and within countries. Violating some of those agreements can shatter the rest, destroying the privilege of money. A massive violation of norms can produce a massive loss of value. And a fortress of reserves offers no protection.

USG is a serial violator of norms, laws, conventions and agreements. Whereas gold needs no credibility because it is a thing unto itself. It requires no laws, conventions or agreements.

Gold probably won't be a saviour of the world economy, but it is the likely default that will emerge from the ashes of the modern world along with various cryptocurrencies.

New Government is Needed

Someone sent me this piece, which makes a similar argument that I made earlier today:

we have a political problem. Solutions such as blockchain can form the basis of a new monetary system, but getting their is a political problem. Relying on the technology is destined for failure because the politics are not solvable by technology.

What Canada Means for Crypto: What Canada Means for Crypto

Imagine you donated C$50 to the Freedom Convoy before it arrived in Ottawa, an action Trudeau has retroactively decided disqualifies you from participating in modern society. (This is not a hypothetical, at least if this Canadian Member of Parliament’s tweet is to be believed). Your bank accounts have been frozen, credit cards canceled, and access to your brokerage account denied. Further, imagine you have accumulated some Bitcoin in a cold storage wallet (i.e., on a flash drive in your possession), carefully ensuring that it is outside Trudeau’s reach. How are you going to pay your mortgage, car payment, tuition expenses, or buy groceries with it? The answer is you can’t. Does that wallet represent a store of value that might be reactivated in the future should the government change its stance towards you, or is itself changed altogether? Absolutely. Does it represent a practical medium of exchange, one that is useful during this personal crisis? Absolutely not.

Unfortunately, we must also admit the same analysis holds true for gold, a conclusion that runs opposite to our previous thinking on the topic. However effective gold might be as a store of value, if the only available functions during a time of personal crisis are to facilitate bartering or fleeing, it isn’t money. Gold bugs and crypto advocates alike should be aghast at what Trudeau has done and at what those in the US Treasury undoubtedly have in store for Americans.

And therein lies the critical conundrum: alternative forms of money require a benign government to allow for their proliferation, but a benign government negates the need for alternative forms of money. This is a political problem, and no amount of Bitcoin or Gold Eagles will help when the political eye turns against you. Money is what the government says it is, and we just got a glimpse that our views – political, cultural…personal – form a relevant condition to being allowed to spend it.

I Like Big Blocks, BitcoinSV Closing in on Sustainablility

Here is Block #725511Why does this matter? Bitcoin started with a mining subsidy. The coins are issued as a reward for each block mined. Eventually, these rewards become too small to justify mining (and eventually go to zero because there's a fixed amount of coins). Either the price or transactions must rise to make it a viable long-term operation. BTC went the "digital gold" route. It survives on high prices. With the block reward currently 6.25, a miner can expect about $250,000 if they solo mine a block. BitcoinSV goes the opposite route, aiming for microtransactions. The 3.8 GB block above had 188,101 transactions and generated 9 BSV in fees at an average of about half-a-cent USD, exceeding the mining subsidy. Since BSV is currently around $100, that is only $900, plus the 6.25 reward for $1525 total. Miners can switch seamlessly between chains so the profitability of all the chains is similar.

However, the fact that BSV has generated blocks with fees that exceed the reward means it can become a sustainable business for miners. I was turned off by mining in part because I wondered what happens when the speculative bubble pops. Putting up millions in capital to possibly obtain an asset at some future date at some unknown price is less attractive than a business with growing, reliable profits. Or less attractive than putting millions into the asset itself if expecting a price increase.

A consistently growing block fee puts a floor on the mining reward and lowers revenue risk for miners, particularly if some fees are fiat-based because that will further reduce volatility. Mining revenue becomes more predictable from a consistent stream of fees. This will attract low time preference miners who will make longer-term investments in the chain, versus the high time preference miners who are engaged in speculation on price. When a chain can consistently exceed the block reward in fees, it becomes a self-sustaining enterprise and has a viable shot at become once of the few winners that emerge from the start-up jungle.

Crypto Complex Breakdowns

I saw that the average stock in the market is down 38 percent from their high. Well, take a stock like SI. it is down 56 percent as of today. It still has an 80 percent drop ahead of it because the entire bubble will be reversed. The even better good news for bears is that the major indexes are still relatively high and VIX is still low.

BTC at Risk of Breakdown

looks like crypto may be joining the bears. Not quite there yet...