Category: Federal Government

Economic History · Federal Government · investing · Personal Finance

What Happens To Bitcoin Post-Dollar?

economiccommander2 Comments

This is more of a thought piece than anything else, though I’m sure it will rile up a lot of Bitcoin HODLs and “technical analysts.” Much as I own (not enough) of the shiny algorithm coin,  the entire way we go about perceiving future currency seems rather warped. It’s a question requiring a bit beyond the typical wide-eyed enthusiasm of liberty advocates and the general freedom rabble.

For a long time, the theory of Bitcoin promoters has been that its limited cap of 21 million units serves as a safe store of value versus the highly-inflated dollar, which shows no signs of stopping its brrr-a-thon. Coin baggers predict that their currency will continue to rise as governments spend and borrow, perhaps at some point replacing the classical concept of “fiat” or paper money. Folks who have bought or continue to purchase before Bitcoin’s rise to a dominant financial position will be rich, while others are left with largely worthless investments.

But there’s one problem of sorts. These Bitcoin pumpers are basing their wealth and success on its exchange rate with the U.S. Dollar. In other words, to be a Bitcoin “millionaire,” you must assess its value in accordance with the same fiat currency that is supposedly unstable. Selling out of Bitcoin to realize some of this wealth means holding large amounts of an inflationary currency which continues to rise along with the president’s signature on spending bills.

Now, a skeptic could argue he will buy gold with his Bitcoin, but this is highly inconvenient for global transfer and transactions where the price point is less than a full ounce of yellow metal. Furthermore, gold itself is giddily valued in line with the dollar, despite the fact that its supporters believe fiat to be unstable and inflationary. A goldbug I knew even tried to diminish the validity of S&P 500 returns by claiming they were based in dollars instead of gold, despite arguing for gold on the basis of dollars.

This brings us to an important query: what happens if the dollar actually collapses, or ceases to exist? Does gold continue to “store” value? Is Bitcoin still worth a lot of money relatively, or does it adopt a dominant position attune to the dollar, albeit with less inflationary tendencies? And what happens to the people who failed to purchase crypto when it was cheaper in dollar terms? Are they doomed to scraping out an existence with whichever fiat currencies remain, or trying to collect a monthly check of 0.00000000001 BTC to afford the good consumerist lifestyle?

No one can really know. The future might be crypto, but that scenario could end up being unpleasant, depending on who possesses a bigger account.   

Culturalism · Economic History · Federal Government

The Cult of Conventionalism

economiccommander2 Comments

I hope this will be the last (contemporary) political post made on the blog for a while. As much as the topic is compelling, one cannot escape the feeling of its overall vapidity. We observe representatives voting to object to an election in small numbers, knowing well in advance the act is mere grandstanding to avoid what harsh realities a corrupt system has foisted on the people. They “do their part,” even while the finishing glaze was conjured up weeks ago.

Strangely enough, there is a different kind of electoral moralization going on in D.C. and state capitols around the country: that of defending convention. Not long after the fury blew up on Capitol Hill, empowered libertarian representatives quickly rushed to “defend the Constitution” by joining with Democrats and ratifying the results of an obviously corrupt election. These are the same characters frantically warning about excess spending, surveillance, and endless wars, yet the critical moment is simply too trying for their sensibilities. So instead of taking a principled stand to favor what they believe, the route is one of guarding the system and status quo.

What makes this behavior especially confusing is the purveyors’ own knowledge that they are waging a losing battle by being good town watchmen over modern day malevolence. The reason spending does not come down is because the decision gets devolved across fifty different states, all with various projects and payoffs lined up for fulfillment. Wars are similarly driven by money, and continue to be pushed by the uniparty majority despite public opposition. Such programs are not going anywhere on the basis of libertarian idea-spreading, and certainly no Balanced Budget is forthcoming.

Keeping all that in mind, what exactly do these steady tradition enforcers get in exchange for their complicity? The simple enough answer is as follows: an opportunity to flaunt moral self-righteousness by being “right” because they warned folks in advance. If the rest of us had only listened to the libertarians and conservatives, somehow the cities wouldn’t be burning, racism would hardly matter, and decency might reign supreme. Now that all is ashes, we should turn and recognize our steady friends who wouldn’t allow the structure to collapse, not for all the ideological triumph in the world.

Perhaps an addendum here should speculate as to whether the system defenders cultivate a martyr complex in their minds to feel better about the collapse of convention. It would certainly jive well with the sacrificial themes of those Abrahamic religions they follow, in which the upright are cut down while preaching forgiveness and respect towards their enemies. Thus they can die (or devolve into the political deserts) knowing their honor was bright, and the other side is wrong or sinful.

Now let us pose one final query: should the more radical Rightists somehow seize power in the future, what shall the libertarians and conservatives do? Will they yet lament the collapse of the system, which holds the bulk of their spiritual wealth, or simply revert to becoming grifters aligned to that triumphant cause?    

Like Descartes, I leave the answer to my dreams.

The Opposition Death Squad
Culturalism · Economic History · Federal Government

The Opposition Death Squad

economiccommander1 Comment

A few days ago, an octogenarian called Botoxi was reelected to lead the House of Representatives over the next two years of bland political soap opera. While a narrow outcome, the result was hardly unexpected, as Democrats possessed a 222-211 majority in the new chamber. Nevertheless, five centrist Dems refused to cast their ballots in the Speaker’s favor, either voting for other candidates or simply dropping “present” on the lectern. Botoxi was thus denied a clear numerical majority, sailing through on the force of a 216-209 tally.

Yet it should have been worse. In a move entirely predictable for their ilk, all six members of the Democratic Socialist “Squad” voted to return Nancy to power. Supreme Leader Alexandria Ocasio-Cortez had this statement to justify the empowered decision:

“Well, you know, I think when you look at the razor-thin margin … We are just an extremely slim amount of votes away from risking the speakership to the Republican party and this is, it’s, it’s bigger than any one of us and that is consequential. But I also think it’s important that we realize that what kind of communities, which communities and all of the communities that, that creates Democratic power, power,”

The last several words are highlighted for a reason. Against all claims of fighting the system and opposing corporate influence, the Plural Left’s freedom fighters marched right back into the loyalty column when times demanded it. Though one could dismiss the issue as minimal, those brave partisans might have placed real pressure on the Democrats by embarrassing them with a Kevin McCarthy victory, thus setting up a consequence, but of course they did not.

 AOC’s mental recriminations reminded me of an observation made by Georges Sorel in Reflections On Violence:

“A cunningly conducted agitation is extremely useful to Parliamentary Socialists, who boast before the Government and the rich middle class of their ability to moderate revolution; they can thus arrange the success of the financial affairs in which they are interested, obtain minor favors for many influential electors, and get social laws voted in order to appear important in the eyes of the blockheads who imagine that these Socialists are great reformers of the law.”

Notice the bit on “minor favors,” and then go back to AOC’s quote about the slim amount of votes. She is essentially admitting that the only way for the Squad to oppose Botoxi was if the Speaker’s success had already been guaranteed, presumably by a large Democratic majority. Hence progressive opposition is merely a pipe dream involving the securement of a subcommittee seat or symbolic commitment to generalities like “universal healthcare,” all while the system chugs on in contentment.

Later on, Sorel considers the fakery of DemSoc reforms:

“The social revolution is conceived by Jaures as a kind of bankruptcy; substantial annuities will be given to the middle class of today: then from generation to generation these annuities will decrease. These plans must often seem very alluring to financiers accustomed to draw great advantages from bankruptcies; I have no doubt that the shareholders of L’Humanite think these ideas marvelous; they will be made liquidators of the bankruptcy, and will pocket large fees, which will compensate for the losses which this newspaper has caused them. ”

That, in effect, is Democratic Socialism. Any pronounced opposition is annihilated as soon as money and power become matters of discussion. Just keep spinning and ranting about Wall Street taxes.

Economic History · Federal Government · investing · Uncategorized

Break Their Fall

economiccommander2 Comments

The older I get, the less enjoyable or exciting any “black pill” realization becomes. It might speak to the sad state of affairs currently showcased, but in reality a cosmic manifestation of elitist gall is the culprit. Rather than hiding their malevolence, the dominant players of our time have settled into an open, unapologetic method of communicating intent. Thus we as observers are left to endorse rather blasé attitudes in the face of searing rain, at once feeling the discomfort but taking solace in the fact that its arrival could be predicted from a long ways off.

A perfect example of this lies in the wondrous implications of the Dodd-Frank legislation signed by President Obama in 2013. The landmark legislation was celebrated for supposedly raining in the excesses of Wall Street (a highly dubious claim), and is regularly cited by leftists to show the successes of 44. At the same time, the mammoth bill put forward some rather interesting features that drop hints about what is to come.

In reaction to the controversy over government-funded bailouts of banks, the legislation permits such institutions to maintain solvency by pursuing a strategy of “bail-ins,” an option which involves seizure of a large percentage of customer assets to keep the firm afloat. Due to protections bolstering derivatives on the totem pole of importance, users with regular checking and savings accounts might well be subjected to the experience of people in Cyprus, who lost tremendously after a financial crisis on the island.

What’s really lamentable about the whole matter concerns how little attention it has received. The stock market continues to return stimulus-induced profits, Congress is just barely approaching a COVID deal after months of haggling, and an incompetent geriatric is poised to become president in January. But this bit of legal scribbling, which stands to produce disastrous effects in the very real future, is remanded to the likes of The Epoch Times, an alleged “fake news” paper.

I suppose the natural response is to dive deeper into Bitcoin, yet even on that front the waters are becoming murkier. Mnuchin the Moocher has taken first blood, and I would not expect Yellen to be much different. The steady swill of power and corporate greed seems to overtake everyone, no matter the designs of their sacred oaths and professed beliefs.

Perhaps we should buy land.

Economic History · Federal Government · investing · Personal Finance

The XRP Smackdown

economiccommanderLeave a comment

There has been much gnashing and simping over the announcement of an SEC lawsuit against Ripple, one of the more controversial cryptocurrencies on the market. For some, the move is confirmation of their fears that XRP is a scam, and carries with it an advisement to purchase Bitcoin. Others are holding the line, suggesting the storm will work itself out and leave Ripple stronger than before.  

I tend to be in the latter category, perhaps driven in part by my long-time holding of the currency, but also because the lawsuit itself seems rather like a rather flimsy last-ditch attempt at relevance by Jay Clayton, the outdoing SEC chairman and historical big bank shill. Take a look at the government’s statement:

“We allege that Ripple, Larsen, and Garlinghouse failed to register their ongoing offer and sale of billions of XRP to retail investors, which deprived potential purchasers of adequate disclosures about XRP and Ripple’s business and other important long-standing protections that are fundamental to our robust public market system.”

The SEC’s argument hinges around the idea that Ripple should have been registered as a security (like a stock) rather than a currency, and thus their practices are problematic under federal law. They claim that the coin’s coming into existence with an existing trove of units rather than gradual mining of new ones pushes it outside the cryptocurrency category, as buyers were purchasing coins from the company itself.

Much as this might seem devastating to XRP’s future, it runs up against an obvious issue: the government previously granted Ripple the status of a currency, and thus will have to go against its prior declarations. While the SEC has won lawsuits against other altcoins in the past, this was following the release of a 2017 directive on their part, a rule which post-dated the ICO of Ripple. Thus Jay Clayton and Co. will need to prove XRP was running afoul of existing rules despite the relatively uncharted waters of cryptocurrencies in federal code.

Another obstacle for the federales surrounds the openness of the global community. Although Uncle Sam might well crackdown on firms like Ripple, other jurisdictions could opt for looser restrictions, or perhaps adopt XRP for themselves. It is not beyond the realm of possibility that smaller countries begin to use Ripple, and geopolitical opponents may well do the same. In any case, the nature of crypto makes it difficult for a single bureaucratic move to put the kibosh on all hope.  

Of course this could just as easily be investment white-knighting on my own part, but at least the cheap price of Ripple makes any future collapse largely nonthreatening.

Culturalism · Economic History · Federal Government

Is AOC Actually Wrong?

economiccommander1 Comment

Ever since her victory in the 2018 Democratic primary over incumbent corporate Dem Joe Crowley, Alexandria Ocasio-Cortez has been the prevailing fodder of Conservatism Inc. They love yukking it up over her air-headed takes on the issues, and lamenting the seemingly-delusional slide of her millennial supporters towards socialism. As irrelevant as she happens to be in the grand scheme of things, they simply can’t let go of the entertainment factor.

The latest iteration of their guffawing comes in the form of the following tweet, in which she gets angry at people dismissing her as a do-nothing social media icon:

Of course we have the obligatory Cernovich reply below, which, coming from the biggest Twitter prostitute of all, drips of smug hypocrisy:

Much as we might like to dismiss AOC’s complaint, it feels rather legitimate in the context of modern politics. Sure, she mostly makes big statements and tweets, but then again, what politician doesn’t do the same? Trump certainly is guilty of this, and for that reason alone he may have lost considerable support. Take a look at these examples:

So he’s “closely monitoring” a situation as the country tears itself apart, just like he promised an executive order on birthright citizenship, and the classification of AntiFa as a terrorist organization. Then we have Jim Jordan screeching about Big Tech, all while planning to do nothing, These are supposedly “strong” indications of action, but in the end they manifest as nothing more than empty words, just like AOC’s public proclamations. The deceptive smoke blows both ways.

If we examine democracy from a broader perspective, this is not exactly new. Politicians have always made large declarations about their intentions or ideas to do something, for the simple fact that election or reelection depends upon visibility and assumed competence. A leader who chooses to play it safe and focus on the policy wonk aspects is liable to be smothered, as the media will not report anything beyond the headline, apart from C-SPAN at least. Thus these short messages are strategic, even if they amount to little in the end.

The relative “problem” caused by AOC is not so much “only tweeting,” but rather the manner in which she has somewhat dislodged the established “conservative” alternative media from its fine pedestal. Prior to her rise, the leftist burn-bringers online were largely made up of the Young Turks or ripped segments from cable news. While useful, these sources lack the power of an indignant and uncompromising opposition. AOC on the other hand injects a certain vitality into the narrative which they cannot control, especially in regards to the role of government versus corporations. That is the main issue.

Tweet on, and do nothing.   

Certificates · Culturalism · Federal Government

The Illusion of Resistance

economiccommander1 Comment

Much clucking and chirping is afoot in the GOP Twittersphere over surprisingly good House election outcomes for the 2020 election. Republicans won a handful of seats, and may end up forcing the Dems as low as 220 representatives, a weak majority over next year’s Congress. Though this might seem exciting to politicos and their ilk, the result simply outlines yet again the haplessness of belief in resistance-style politics championed by both the Right and Left.

If we cycle back to 2010, the conservative party used Tea Party anger against Obamacare and “wasteful spending” to power its 63-seat swing against Democrats, leading to a majority of 242. They fell short in the Senate, but nevertheless gained seats. Now, did America see historic cuts or entitlement reform? Absolutely not, because GOP resistance amounted to simply opposing tax increases on the wealthy, whilst blocking serious spending reductions at every turn. Such bumbling proceeded on to the 2012 presidential election, which rewarded the dedicated TP activists with a campaign platform sworn to protect Mitt Romney from tax penalties and back a budget plan with net cuts of only $155 billion. Why? Because the Tea Party quickly became a subsidiary of Koch Brothers interests, not the average American.

In late 2011, Occupy Wall Street protests exploded across the country, determined to draw attention to corporate greed. Despite their fierce tenacity, and the relative pro-corporate leanings of Barack Obama, the protestors ultimately ended up serving as a political and financial cow to help Democrats retain the presidency. The people insistent on getting money out of politics helped return a figure who raised more from Wall Street corporations than his “pro-business” Republican opponent.  Once more, an allegedly populist movement got co-opted by the financial mainstream, and with scarcely a cry issued.

More recently, the Black Lives Matter riots have shown a similar nature. Although presuming to oppose a tyrannical police state praying on minorities, the street advocates and their “La Resistance” friends have no conflict with blindly obeying the dictums of CDC officials to “mask up,” or translating their movement into a train of endorsement for Biden, perhaps the vilest plutocrat to attain office in short memory. The very idea that committed protestors happily obey the medical industry complex as they pretend to stand for justice, or submissively quiet down to help a Democrat attain power; said actions demonstrate a brilliant lack of autonomy and agency which undercut the primary themes. Nothing is really being disrupted, only the comfort of political opponents.

So it’s all well and good that Republicans are excited about their prospects, but these remain meaningless without action. Until legislation is on the desk—signed—their fist-waving and proclamations about being “loyal opposition”  will stay as mere words. For opposition is futile, and resistance an illusion.

Federal Government · investing

Can Bitcoin Be Regulated?

economiccommander4 Comments

One of the great cultural nuances of the internet is how everyone can be right. Providing you are convincing, or at least look the part, most effective dissent will get chucked out the window, along with any need for respect. In point, we have the prototypical messaging of the Bitcoin-promoting community, which often argues that digital currency is beyond government regulation or control due to algorithms and encryption. They have some credibility, but as with all things deemed to “beat the system,” there are major exceptions which must be considered.

To start, the idea that crypto transactions can simply fly under the radar is muddled by known IRS actions. The federal government has already issued warnings to thousands of people about failure to report crypto gains to the IRS, and significant penalties lurk for those who flaunt such warnings. We also have the recent indictment of John McAfee for allegedly hiding cryptocurrency assets. Thus from a reactive standpoint the State is already gearing up for the long haul fight.

Perhaps more immediately, reports suggest the government seized around $1 billion worth of Bitcoin connected to the controversial Silk Road marketplace, whose founder Ross Ulbricht was given a life sentence for numerous alleged crimes. That’s a small but noticeable chunk of the overall coin value, and it’s not the first time Uncle Sam has held a stake. Other governments such as Bulgaria have snapped up digital currency in the past, with the leaders in Sofia holding 200,000 bitcoins at one stage.

Ruling out these sorts of criminal situations, what of the more obvious methods for centralized regulation? Governments could begin requiring trading firms like Coinbase to meet specific standards of licensure and tax reporting, much as investment companies are required to do. They might also go after crypto miners, placing restrictions or taxes on their Morian mainframes These are hardly out of the question when we examine the history of the State, and its insatiable desire for money.

By this I don’t mean to suggest crypto is a bad idea; in fact, I own a great deal and will continue adding. Just avoid becoming too drunk on the swill of lolbertarianism. As Ronny boy might say, “The government wants what it wants.”

Culturalism · Federal Government

How Conservatives Protest

economiccommanderLeave a comment

Last week at the MAGA rally, Sebastian Gorka spoke by the Supreme Court, loudly demanding to the Plural Left, “Where’s all the looting and burning?” Much applause followed, and conservatives proudly reminded themselves how much better they were than their liberal opponents. After further marching and cheering, they all went home.

Gorka’s comment and the behavior it refers to are important because they help encapsulate the very heart of conservative attitudes towards resistance or civil disobedience. Over the summer, the Right continued spinning narratives about how they supported “law and order” versus the historically butthurt and rich leftist protestors who milled about, smashing businesses and looting stores. The idea was that the “good guys” would defend small businesses and “Back the Blue,” while their enemies ran amuck to cause destruction.

Such a storyline works well so long as you maintain power, because it projects the Boomer idea of communities under assault by the wild and communistic. Once elections go the other way, however, the message is a completely dull edge. Peacefully protesting election officials or courts while maintaining support for the establishment (laws, police, military), effectively implies acquiescence to whatever outcome they are sworn to protect. “Law and Order” now means accepting a Bidenesque presidency, even if the tagline is that fraud has been perpetrated across the country.

Herein rests the heart of conservative struggles with any form of a civil standoff. Much as they might enjoy parading around with their gun collections and body armor wardrobes, the fact remains that any sort of outright defiance requires them to break their own political talking points on defense of public order. Doing battle with police or the military makes them “traitors,” or “unpatriotic,” so instead the approach involves softly declaring opposition and then disappearing off into a SuperBowl Sunday watch session.

For all those reasons, it is hard to imagine any significant conservative action to overturn balloting results. The courts so far have been rather timid, and individuals themselves remain caught in the same conflict of belief. Do the people defending tradition and “the way it has always been” take a risk and break their own vows?

Probably not.

Culturalism · Federal Government

Why Revolutions Fail

economiccommander2 Comments

Ever since I knew enough to remember, there has been talk of revolutions around the world. Tea Party folks declared one would occur if Obama violated their freedoms, leftists did the same under Trump, Arabs bathed in the blanketed feel of their springs, and Hong Kong residents attempted to defeat their colonial government. Whether successful or not, these movements become a romanticized conception of life, a cause that for some seems worth more than all the cost.

Yet they seldom succeed. This isn’t to say political revolutions don’t occur; after all, there is only so much time corruption can stand before the pieces crumble. Instead, the preliminary forces which make such actions possible tend to fizzle out by the time people have gotten a taste of power – and the wealth accompanying it. The average activist doesn’t want to spend their entire life protesting or undermining the system because doing so might cause them to miss out on the niceties of each day. Much like intensely religious people often lapse into the vices of an enjoyable existence rather than remaining pious and stoic forever. The risk of missing out appears too great to ignore.

A book which outlines this dynamic brilliantly is Alexander II: The Last Great Tsar by Edvard Radzinsky. Besides offering a syrupy account of court intrigue under the Germano-Russian dynasties, Radzinsky dedicates much of the text to documenting the various revolutionary attempts and assassinations that brought down various tsars and their supporters. At the start, he quotes one of the first terrorist revolutionaries:

“Our work is destruction, a terrible, total universal and ruthless destruction. The revolutionary is a doomed man. He has not interests, no work, no feelings, no ties, no property, not even a name. Everything is consumed by the single, exclusive interest, the sole thought, the sole passion: revolution. Poison, dagger, and noose—the Revolution sanctifies everything.”

The level of intensity and faith required to observe such convictions for a time –let alone years—is uncommon in any human society. It demands a level of selflessness, along with humble individualism, to be anywhere near triumphant. That might seem contradictory, but in a sense the person must remain individualistic to the extreme that separation from others based on hiding or imprisonment will not drive him mad or create a backbone for misery. A stoic, minimalistic worldview is demanded, at least once the campaign is in motion.

On a different angle, the anarchist Bakunin tried to explain the revolutionary ethos as being a prime objective of life:

“Engulfing Russia, the fire will spread to the while world. Everything will be destroyed that is deemed holy from the heights of modern European civilization, because it is the source of inequality, the source of all of man’s misery. Bringing into motion a destructive force is the only goal worth of a rational man.”

His view is even harder to square with typical human behavior. It was none other than Fyodor Dostoevsky who began as a revolutionary only to turn against the concept after spending years languishing in one of the tsarist concentration camps. After being released he began producing work with a cynical view of revolutionary figures and the disorder which they bring.

Dostoevsky’s ideological shift is something which the radical Nechaev believed could only be avoided by effectively maintaining the revolutionary spirit and ensuring no one had the liberty to slink back towards bourgeoisie ways. He would go so far as to allow correspondence to be intercepted that landed a number of young radicals in prison. The logic is described here:

“In the first two years, students rebel gleefully and enthusiastically. Then they get caught up in their studies, and by the fourth or fifth year, you see that yesterday’s rebel is house-trained, and upon graduation from university or academy, yesterday’s fighters for the people are turned into completely reliable physicians, teachers, and other officials. They become paterfamilias. And looking at one of them, it is hard to believe that he is the same person who just three or four years ago had spoken with such fire about the suffering of the people, who thirsted for exploits and seemed ready to die for the people! Instead of a revolutionary fighter we see spineless scum. Very soon many of them turn unto prosecutors, judges, investigators and together with the government they start to stifle the very people for whom they intended to give their lives. What should be done? Here I have only one hope, but a very strong one, in the government. Do you know what I expect from it? That it put away more people, that students be kicked out of universities forever, sent into exile, knocked out of their usual rut, stunned by persecution, cruelty, injustice, and stupidity. Only that will forge their hatred for the vile government and the society that looks on indifferently at the brutality of the regime.”

In other words, the situation must become so horrendous that the inconvenience and suffering affects everyone, and thus they have no choice but to unite against authority with absolute fervor. Of course in modern terms this is more complicated than radicals want to believe. Until the printing press runs dry (or inflation takes it all), there will be enough monetary security to safeguard the football watchers, comic book fans, and Netflix aficionados. Enough fancy cars and lifted trucks to addle the brain’s aspirations, or Tinder swipes to keep hope alive. Life will go on in general peace.

Perhaps then Francis Fukuyama was correct, albeit not as he intended. Consumer capitalism and liberal democracy are hardly causing Muslim fundamentalists to abandon their viewpoints and surrender to the modern outlet mall. Rather, the happy slush of processed food and streaming entertainment allows us to feel maximum pleasure, and thus no inclination towards revolution.