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Fed Watch - Bitcoin and Macro


Nov 24, 2021

After a week off due to illness, we’re back with a new episode of Bitcoin Magazine’s “Fed Watch'' podcast. In this one, Christian Keroles and I sit down to talk about the mysterious competitive world of central banking. Topics include Powell’s reappointment and, funnily enough, what it means for the ECB. There is an epic pivot in loyalties happening right now, as the Fed takes to heart its role as the US central bank and distances itself from a responsibility to Europe.

0:00 Welcome to Fed Watch #71

1:30 Comparing US Inflation to the ECB and BOJ

2:55 Tom Luongo the next Fed Watch Guest

3:38 Reappointing Jerome Powell as Federal Reserve Chairman

7:33 Central Banks Adressen Stabl eCoins, Bitcoin And Crypto Assets

12:37 The ECB and Central Bank digital Currencies

13:07 Europe is under Pressure

16:53 Bitcoin can Benefit from The current Situation in the EU

18:28 Speculative Attacks with Bitcoin

22:36 Europe in the weakest Makro Position

23:45 The Current Bitcoin Price Action

28:51 Go Follow: @AnselLindner & @Ck_Snarks

 

We start the episode with our first trivia winner. I wanted people to answer the question, if central bank balance sheets matter, why are the ECB and BOJ’s inflation rates lower and balance sheets higher relative to GDP than the US’s? Mitch (@wittyusername30) had the best answer. Congratulations. To paraphrase: central banks don’t print money, they swap inert reserves for useful collateral. This has a deflationary pressure on the economy. Powell gets renominated as Chairman Powell was renominated by Biden for Fed Chairman, winning out over his competition, Lael Brainard. Several reasons were cited, like Powell's path through Senate confirmation is much easier, while Lael might meet with a split vote along partisan lines in a 50/50 Senate. Also, officials said Powell was being “rewarded” with another term for successfully shepherding the economy through the 2020 Covid recession. I view this appointment as having a deeper meaning.

1) We’ve talked at length on this show about Powell’s refusal to go along with the Central Bank Digital Currency (CBDC) hype. Other central banks are pushing hard for CBDC, and Powell continuously splashes cold water on that idea. This symbolizes a break with globalist interests in favor of American banking interests.

2) Powell has faced rising Progressive opposition from Congress. Crazies, like Sen. Elizabeth Warren, have attacked him because he is not dovish enough and not buying into the Fed’s role in climate policy. His reappointment is a repudiation of sorts against Progressives and their toxic ESG initiatives.

3) Lael is the more globalist-friendly choice. Powell symbolizes a break with globalists to a more America-centric policy. ECB Regulation and Panic Next, we jump right into ECB news. This week they released a new regulatory framework for electronic payments. The Eurosystem will use the new framework to oversee companies enabling or supporting the use of payment cards, credit transfers, direct debits, e-money transfers and digital payment tokens, including electronic wallets. The PISA framework will also cover crypto-asset-related services, such as the acceptance of crypto-assets by merchants within a card payment scheme and the option to send, receive or pay with crypto-assets via an electronic wallet. ECB Press Release This stands in stark contrast to the US, where the White House and Treasury tried to carve out a bitcoin exception in the recent Infrastructure Bill, which ironically was thwarted by altcoiners wanting to protect scams that are Decentralized In Name Only (DINOs). The ECB is scared that the Euro will lose market share in the years to come, whittling away their “monetary sovereignty”. They want to block competition from dollar stablecoins and bitcoin, while at the same time provide the market with a digital Euro. A digital Euro the market hasn’t seen fit to provide itself by the way. It was during the peak of EDC1, that bitcoin first established itself and rallied in the bitcoin bubble of 2011 to $30. Could we see a repeat 30x rally this time? Probably not that much, but a massive rally is in the cards in the coming year. Thanks for listening. If you found this episode informational, please share and give us a rating on iTunes so others can find the show!

Links

Biden Keeps Powell as Fed Chief, Elevates Brainard to Vice Chair

https://archive.ph/9j4PA

Eurosystem publishes new framework for overseeing electronic payments https://www.ecb.europa.eu/press/pr/date/2021/html/ecb.pr211122~381857cdfe.en.html

Written by Ansel Lindner Economist, bitcoin specialist, and author of the Bitcoin Dictionary and the free weekly Bitcoin Fundamentals Report. Find more from Ansel at the bitcoinandmarkets.com