jakiro
Original title:Trump Truth
Author: Arthur Hayes, founder of BitMEX; compiled by: 0xjs@Bitchain Vision
Four steps: the distance between the position where the vertical wooden board is fixed on the movable bracket and the wall.My yoga teacher taught me to place the heels of my hands at the position where the boards and the brackets are connected.I curled up like a cat, making sure the back of my head was flush with the board.If the distance is right, I can move my feet up along the wall behind me, turning my body into an L-shaped shape, with the back of the skull, back and sacrum touching the board.I had to fight the tendency of ribs to spread out by exercising my abdominal muscles and tightening my tailbone.Huh-I’m already sweating just because I keep my body in the right position.But the real work has not begun.The challenge is to lift one leg into a completely vertical position while keeping it aligned.
This stick is like a good medicine to reveal the wrong posture.If you are incorrect, you will immediately notice that you can feel the back and hips part being off the stick.All my musculoskeletal problems were exposed as I lifted my left foot and my right foot was still leaning against the wall.My left lats dorsi and my left shoulder vagus, looked like an asymmetric curling rod.But I already know this because both my athletic coach and chiropractors found that the muscles in my left back were weaker than those in my right back, which caused my left shoulder to be higher and roll forward.Using a stick to do handstand practice will only make my body imbalance more obvious.There is no quick solution to my problem. There is only a long way to go, and sometimes painful practices are required to slowly correct my imbalance.
If vertical planks are my body aligning truth potion, then the US President-elect Donald Trump has played a similar role in the various geopolitical and economic issues facing the world today.The reason why the global elite hates Trump is because he tells the truth.The truth about Trump I mean is limited to a narrow range of topics.I’m not talking about whether Trump will tell you the truth about his dick size, his net worth, or his golf handicap (a number used to measure the potential abilities of an amateur golfer).Instead, Trump’s truth tells the practical relationship between different nation-states and the opinions of ordinary American voters when they are away from the safe space of politically correct Nazis.
As a macroeconomic forecaster, I try to make predictions based on public data and current events to guide my portfolio of assets.I like The Truth of Trump because it acts as a catalyst to force other heads of state to acknowledge the problems facing their countries and take action.It is these actions that ultimately bring about the future state of the world where Maelstrom hopes to profit from it.Even before Trump re-asced the throne, countries were acting the way I predicted, which further strengthened my confidence in how to print money and implement financial suppression methods.This year-end article aims to gradually introduce the significant changes that are taking place within and between the four major economic groups and nation-states (US, EU “EU”, China and Japan).rightIn my recent position, it is very important whether I believe that printing of money will continue and accelerate after Trump’s crown on January 20, 2025.This is because I think cryptocurrency investors have high expectations for Trump’s speed of change, but Trump has no politically acceptable solution to quickly achieve this change, and there is between the twoA big gap.The market will immediately realize that Trump will implement any policy changes for only one year around January 20.This awareness will lead to a massive sell-off in cryptocurrencies and other Trump 2.0 stock trading.
Trump has a year to take action as most U.S. elected lawmakers will start running for the November 2026 U.S. midterm elections by the end of 2025.The entire House and a large number of senators must run for re-election.Republicans have very weak majority in the House and Senate and they are likely to lose power after November 2026.The American people were rightly angry.However, it will take more than a decade, not just a year to address fundamental domestic and international issues that negatively affect them.Therefore, investors are preparing for serious buyer remorse.But can the wall of money printing and a large number of new regulations aimed at curbing savers overcome the phenomenon of “buy rumors, sell facts” and keep the cryptocurrency bull market active in 2025 and beyond?I believe it can, but this article is my attempt to vent myself and convince myself of this possibility.
Currency stage changes
I will quote Russell Napier’s point in my very simple post-WWII currency structure timeline.
1944–1971 Bretton Woods System
Countries fix their currency exchange rates on the US dollar, which is $35 per ounce against gold.
1971–1994 Petroleum Dollar
US President Nixon abandoned the gold standard, allowing the dollar to float to all currencies because the country cannot maintain its linkage to gold while funding the larger welfare state and the Vietnam War.He reached an agreement with oil exporters Persian Gulf countries, especially Saudi Arabia, that they would price oil in US dollars, exploit as much as they require, and recycle their trade surplus into U.S. financial assets.If you believe certain reports, the United States manipulates certain Gulf countries to raise oil prices in order to use it as a support for this new currency structure.
1994–2024 Petroyaun
China has depreciated the RMB against the US dollar to counter inflation, collapse of the banking system and revitalize the export industry.Mainland China and the four Asian dragons (such as Taiwan, South Korea, Malaysia, etc.) implement mercantilist policies, providing cheap exports to the United States, resulting in the accumulation of US dollars overseas as foreign exchange reserves, so that they can afford US dollar-denominated energy and high quality.Manufactured products, and ultimately introducing more than one billion low-wage workers to the global economy, has curbed inflation in developed Western countries, allowing central bank governors in these countries to keep interest rates at a minimum because they mistakenly believe endogenousInflation has declined for a long time.
White is US dollar/RMB, and yellow is China’s GDP calculated in constant US dollars.
2024 — Now?
I don’t know the name of the system currently being developed.However, Trump’s election is a catalyst for changing the global monetary system.It should be clear that Trump is not the reason for the readjustment; instead, he spoke out bluntly about the imbalance he believed must be changed and was willing to develop extremely destructive policies to quickly achieve what he thought would make the United States firstChanges in people’s benefits.These changes will end the oil yuan.Ultimately, as I argue in this article, these changes will increase the supply of fiat money and financial inhibition of globally.These two things must happen because no leaders in the United States, the European Union, China or Japan want to lower the leverage of their system and put it into a new sustainable balance.Instead, they will print money and destroy the actual purchasing power of long-term government bonds and bank savings deposits so that the elite can continue to take charge of the new system.
I will first outline Trump’s goals and then evaluate how individual groups or countries react.
The truth about Trump
In order to operate normally, the United States must maintain the current account and trade account surplus of the oil RMB system.The result is deindustrialization and financialization of the US economy.If you want to understand the principles, I suggest you read all of Michael Pettis’s work.I don’t think this is why the world should change its economic system, but since the 1970s, white American men (who should have served them) have lost space to live.The keyword here is “Average”; I’m not talking about high-ranking people like JPMorgan and Goldman Sachs CEOs Jamie Dimon and David Solomon, nor are wage scammers who work hard for them.I’m talking about a brother who once worked at Bethlehem Steel, owned a house and spouse, and now the only woman he meets is a nurse at the methadone clinic.This is obvious because this group of people in the United States are committing chronic suicide with alcohol and prescription drugs.Everything is relative, and the current situation is not good compared to the higher living standards and job satisfaction they enjoyed after World War II.It is known that this is Trump’s supporters, and the way he talks to them is something other politicians dare not do.Trump promises to bring industry back to the United States and make their miserable lives meaningful.
For bloodthirsty Americans who are keen on playing war video games, they are a very powerful political group, and the current situation of the US military is embarrassing.The supreme myth of the U.S. military relative to its close neighbors or equivalent opponents (only Russia and China currently meet this standard) begins with the idea that the U.S. military freed the world from Hitler’s onslaught.This is incorrect; the Soviets sacrificed tens of millions of people to defeat the Germans.The Americans just wiped out the troops.Stalin was distraught with the United States for a long time to launch a large-scale offensive against Hitler on the Western European front.US President Franklin Delano Roosevelt bleed the Soviets in order to reduce the deaths of American soldiers.In the Pacific War Zone, although the United States defeated Japan, they never faced a full-scale attack from the Japanese army, because Japan devoted most of its combat effectiveness to mainland China.Hollywood should not vigorously promote the Normandy landing in the movie, but should show the Battle of Stalingrad, General Zhukov’s heroic deeds, and millions of Russian soldiers who died.
After World War II, the US military tied with North Korea in the Korean War, lost to North Vietnam in the Vietnam War, retreated in a hurry after ten years of stationed in Afghanistan in 2021, and now it is defeated to Russia in Ukraine.The only remarkable record for the US military was to use extremely advanced and extremely expensive weapons against third-world countries such as Iraq during the two Gulf Wars.
The key is that victory in the war is a reflection of the stability of the industrial economy.If you care about war, the U.S. economy is a mess.Yes, Americans can make leveraged buyouts like other countries.However, their weapon systems are a mixture of imported Chinese products, sold at high prices to captured customers such as Saudi Arabia, who must purchase them under geopolitical agreements.Russia’s economy is less than one-tenth of that of the United States on paper, but the cost of the unstoppable hypersonic missiles it produces is only a small part of the traditional missiles made in the United States.
Trump is not a peace-loving hippie; he fully believes in American military hegemony and exceptionalism and is willing to use this military force to massacre humanity.Remember that during his first term, he assassinated Iranian General Qasim Soleimani on Iraqi territory, which made the American people ecstatic.Trump has no concern about invading Iraqi airspace and has unilaterally decided to murder a general from another country where the United States has not formally fought.Therefore, he hopes to properly re-arm the empire so that its capabilities are consistent with the hype.
Trump advocates reindustrialization of the United States to help those who want good manufacturing jobs and those who want strong military power.To do this, it is necessary to reverse the imbalance established under the oil RMB system.This will be achieved by devaluing the dollar, providing tax subsidies and subsidies to produce domestically and deregulate.All these factors combined will make it economically wise for companies to transfer production to the country, as China is currently the best place to produce products, thanks to the policies that have been formulated over the past three decades to promote growth.
In my articleBlack or white?》 , I talked about quantitative easing policies (QEs) for the poor and how this would fund reindustrialization in the United States.I believe that the incoming U.S. Treasury Secretary Becent will implement such an industrial policy.However, it takes time, and Trump needs to come up with immediate results that can be sold to voters in his first year of office.therefore,I think Trump and Becent have to devalue the dollar immediately.I want to discuss how this is achieved and why it must be achieved in the first half of 2025.
Strategic Bitcoin Reserves
“Gold is money, everything else is credit.” – J.P Morgan
Trump and Becent repeatedly discuss the need to weaken the dollar to achieve U.S. economic goals.The question is, what currency should the US dollar depreciate to and when?
In addition to the United States, the countries with the largest export volume in the world are China (currency: RMB), the EU (currency: euro), the United Kingdom (currency: British pound) and Japan (currency: Japanese yen).The dollar must depreciate against all these currencies in order to encourage lucrative companies to transfer production into the United States.Companies do not necessarily need to be registered in the United States; Trump agrees that Chinese manufacturers set up factories in the United States and sell products locally.But Americans must buy products produced in American factories.
Coordinating monetary agreements was in the 1980s.At present, compared with other countries in the world, the United States’ economic and military strength is not as good as it was at that time.Therefore, Becente has no ability to unilaterally order exchange rates in other countries.Of course, Becent could use carrots and sticks to trick each country into agreeing to depreciate its own currency against the US dollar.This can be achieved by using tariffs or threatening tariffs.However, this requires time and a lot of diplomatic means.There is also an easier way.
The U.S. holds 8,133.46 tons of gold, the most of all sovereign states, at least on paper.As we all know, gold is the real currency of global trade.The United States has been out of the gold standard for only 50 years.The gold standard has always been a historical rule, and the current fiat currency system is an exception.The way to achieve Becente’s goal is to depreciate the US dollar relative to gold.
Currently, gold on the U.S. balance sheet is worth $42.22 per ounce.Technically, the Treasury issued a gold certificate to the U.S. Federal Reserve (Fed), which the Treasury valued at $42.22 per ounce.Suppose Besent can convince the U.S. Congress to change the legal price of gold, thereby depreciating the dollar against gold.In this case, the Treasury General Account (TGA) in the Federal Reserve will receive a dollar credit that can be used for the economy.The greater the depreciation, the higher the TGA balance will increase immediately.This makes sense because, essentially, the US dollar is created out of thin air by valuing gold at a specific price.For every $3,824/ounce increase in gold statutory price, TGA increases by $1 trillion.For example, adjusting the holding cost to the current spot price of gold would generate $695 billion in TGA credit.
Under government regulations, dollars can be created by changing the cost of holding gold and then used to purchase goods and services.This is the definition of depreciation of fiat currency.Since all other fiat currencies also imply the value of gold based on the amount of gold held by their respective governments, these currencies will automatically appreciate relative to the US dollar.Overnight, the United States can achieve a significant devaluation of the dollar against all its major trading partners without consulting the Treasury Department of any other country.
The most important question is, can’t the largest exporters recover their currency weakness by depreciating more than the dollar against gold?Of course, they can try, but none of these currencies are global reserve currencies and there is no inherent demand brought by trade and financial flows.Therefore, they cannot match the depreciation of gold in the United States, which will soon lead to hyperinflation of its economy.Hyperinflation is inevitable, because none of these countries/groups can achieve self-sufficiency in energy or food like the United States.This is politically unacceptable, as social unrest caused by inflation will force the ruling elite to step down.
Tell me how much dollar weakness is needed to reindustrialize the U.S. economy and I can tell you the new gold price.If I were Becente, I would have invested heavily.A large investment means a revaluation of $10,000 to $20,000 per ounce.Luke Gromen estimates that the gold-to-Feder dollar debt ratio returning to the 1980s would result in a 14-fold increase in gold prices from current levels, and would be close to $40,000 per ounce after depreciation.This is not what I expected, but it shows how much the current spot price of the U.S. dollar relative to gold is about $2,700 per ounce.
Many of you know that I am a little golden insect.I own physical gold bars and junior gold exchange-traded funds (ETFs) in the vault because the easiest way for the dollar to depreciate is against gold.Politicians always press the simple button first.But this is the cryptocurrency trader digest, so how does the price of gold at $20,000 per ounce drive up the price of Bitcoin and cryptocurrencies?
Many cryptocurrency hopers focus on the discussion of Bitcoin Strategic Reserves (BSR) first.U.S. Senator Lummis introduced legislation requiring the Treasury Department to purchase 200,000 BTC per year over five years.Interestingly, if you read this bill, she recommends funding the purchase by raising the price of gold held on the government balance sheet, as I mentioned above.
The reason for supporting BSR is similar to the reason the United States stores more gold than any other nation-state; it enables the United States to claim financial hegemony over all other countries in the digital and physical realms.If Bitcoin is the hardest currency ever, then the strongest government fiat currency is the currency whose central bank has the most bitcoins.Additionally, a government with fiscal fluctuations with Bitcoin prices will develop policies that will help expand the Bitcoin and cryptocurrency ecosystem within its territory.This is similar to the way the government encourages domestic gold mining and establishing a strong gold trading market.See how China encourages domestic holdings of gold through the Shanghai Gold Futures Exchange, an example of a favorable national gold policy aimed at improving the financial strength of the country and its citizens in actual currency.
If the U.S. government creates more dollars through the depreciation of gold and buys Bitcoin with a portion of it, its fiat price will rise.This in turn will stimulate other countries to make competitive sovereign purchases that must catch up with the United States.Then the price of Bitcoin will gradually rise, because no one will sell bitcoin and get fiat currency that the government is actively depreciating.Of course, long-term holders will sell their bitcoins at a fiat price, but that price won’t be $100,000.This argument is logical, but I still don’t believe BSR will happen.I think politicians would rather spend the newly created dollars on the welfare of the people to ensure they win in the next election to be held.However,It doesn’t matter whether BSR occurs in the United States, because it’s just its threat to create buying pressure.
While I don’t believe the US government will buy Bitcoin, this will not affect my optimistic view of the price of Bitcoin.Ultimately, gold depreciation creates the dollar, and the dollar must find its home in actual goods/services and financial assets.We know from experience that due to the limited supply of Bitcoin and the continuous decrease in circulation, its price has risen faster than the growth rate of global US dollar supply.
The Fed’s balance sheet is white and Bitcoin is yellow.Both indexes were 100 on January 1, 2011.The Fed’s balance sheet rose 2.83 times, while Bitcoin rose 317,500 times.
All in all, the rapid and dramatic devaluation of the dollar is the first step for Trump and Becent to achieve their economic goals.This is also something they can do overnight without consulting domestic legislators or foreign finance heads.Given that Trump has a year to show progress on some of his goals to help Republicans maintain control over the House and Senate, my basic forecast is the dollar depreciation against gold in the first half of 2025.
Next, let’s take a closer look at China and speculate on how they will respond to “Trump’s truth.”
Choyna
China is facing two major problems in the near future.Jobs are needed to create more than 20% of unemployed educated youth and prevent real estate prices from falling.The truth about Trump poses problems, as the United States also needs to provide civilians with higher income jobs and increase financial investment in production capacity.I discussed in the previous section that Trump and his deputy would wave the big stick is the weak dollar and tariffs.What are the weapons in China’s hands?
I think China has made it clear that ideologically, China must implement quantitative easing policies and allow the RMB to float freely.So far, China has implemented little fiscal stimulus measures for currency payments issued by the central bank.I think it’s because they don’t want to exacerbate domestic economic imbalances.Furthermore, they were on the wait-and-see state until the new American ruler was elected.But in the past few weeks, it has been clear that China will implement large-scale stimulus through effective quantitative easing financial channels to allow the RMB to float freely.
For those who don’t understand why quantitative easing leads to a depreciation of the RMB, remember that quantitative easing expands the supply of RMB.If the RMB supply grows faster than another fiat currency, then mathematically, the RMB depreciates relative to that currency.In addition, RMB holders may sell RMB today before the central bank in exchange for fixed supply of financial assets such as Bitcoin, gold, and U.S. stocks to protect their future purchasing power.This will also lead to a depreciation of the currency.
Comrades have begun to withdraw money from China.
As I explained before, due to China’s food and energy shortage, they cannot confront the United States and let the RMB depreciate against gold.This will lead to hyperinflation.But this does not mean that China cannot significantly increase the RMB supply and provide support for real estate, which has led to deflation.The recent headlines are that the People’s Bank of China (PBOC) is willing to let the yuan devalue due to Trump’s tariff threat, which shows that China is ready to implement quantitative easing in full.
With Donald Trump returning to the White House, senior Chinese leaders and policymakers are considering allowing the yuan to depreciate in 2025 in response to U.S. raising trade tariffs.– Reuters, December 11, 2024
I think the reason why the People’s Bank of China is vague about why the RMB must be allowed to float freely and eventually depreciate the US dollar in the short term is because they do not want to exacerbate the speed of capital flight.Tell wealthy comrades directly that the policy of the People’s Bank of China now clearly focuses on issuing RMB and purchasing government bonds, which will only sound the alarm in the hearts of the investing public and cause capital to rush across the border, first into Hong Kong, and then flow from Hong Kong to the worldOther areas.The People’s Bank of China hopes investors can accept the hint and instead buy domestic stocks and real estate.
Ultimately, as I did in the article “Come on Bitcoin, let’s go to Bitcoin togetherAs predicted in the Chinese forecast, the People’s Bank of China will take sufficient quantitative easing and monetary stimulus to prevent deflation. If China’s government bonds (CGB) yields start to rise, we will know whether these policies will work. Currently, CGB yieldsThe rate is at an all-time low, as investors would rather buy investment vehicles (government bonds) that are protected by the RMB than risk losing money in the stock market and the real estate market. This shows that people are pessimistic about the medium-term strength of the Chinese economy.It is easy to turn pessimism into optimism, just print a large amount of RMB and remove CGB from investors’ portfolios through the central bank’s open market operation. This is the definition of quantitative easing. See me in “Black and white?” T chart in the article to understand how this process works.
The issue of printing money at the macro level has always been the external value of the RMB.The strong RMB has some positive external effects.It helps Chinese consumers buy imported goods at cheaper prices.It increases the possibility that Chinese trading partners value commodities traded with China in RMB, because they can convert the RMB to purchase Chinese-made goods and believe that the actual value of the RMB will remain stable for the long term.It also helps Chinese companies borrow RMB at affordable interest rates.However, in the face of Trump’s truth, all these positives make no sense.Let me be clear: the United States can print more money than China without hyperinflation.Trump and Becent have made it clear that this is what they intend to do.Therefore, China will allow the RMB to float against the US dollar, which means the RMB will depreciate in the short term.
The depreciation of the yuan will allow Chinese manufacturers to export more products before Bescent depreciates the dollar against gold.In the short term, this will produce ahead of schedule and help take a more favorable position in negotiations with Trump, when China must agree to certain requirements from the Trump team in exchange for a more favorable entry of Chinese producers into the U.S. consumer market.
The question that cryptocurrency investors should think about is how wealthy Chinese investors will respond to the signals that the People’s Bank of China will increase the supply of the yuan.Will capital flight through various legal channels in Macau (casino) and Hong Kong (companies registered in Hong Kong by Chinese owners) be allowed to operate normally, or will these channels be closed to seal capital within the territory?Given that the US route is to limit certain fund pools (e.g.Texas Public University Endowment Fund) The ability to invest in Chinese assets, why is it allowed the newly issued RMB to flow into the United States through Hong Kong, helping to fund Trump’s economic goals?The printed RMB must be purchased for Chinese stocks and Chinese real estate.So while the door is open, I expect the capital flight of the RMB against the US dollar will intensify because this opportunity will sooner or later disappear.
For cryptocurrencies, at least in the short term, Chinese capital will be outflowed through Hong Kong, exchanged for US dollars, and buying Bitcoin and other junk coins.In the medium term, once China responds, banning Chinese capital from fleeing through flows and obvious channels, the question is whether Hong Kong cryptocurrency ETFs will be allowed to accept southbound capital flows from mainland Chinese investors.If the mainland believes that controlling crypto ownership through Hong Kong state-owned asset management companies will in fact strengthen China, or at least make China equally competitive with the United States in the cryptocurrency field, then Hong Kong ETFs will quickly gather assets.This will add another pillar to the cryptocurrency bull market, as these ETF managers must buy spot cryptocurrencies on the global open market.
On the other side of the Sea of Japan, elites who manage Chinese export rivals Japanese electronics companies are thinking about how to deal with Trump’s truth.
Japan, the place of sunset
Although Japanese elite politicians are proud of their culture and history, they are still the “towel bitch” of the United States.Japan continued to move forward after a nuclear strike, and by the early 1990s, with the help of US dollar loans and tariff-free entry into US consumers, Japan was rebuilt into the world’s second largest economy.The most important thing for my lifestyle is that Japan has built the largest number of ski resorts in the world.Just like today, the trade and financial imbalances of the 1980s caused a stir in the American elite politics and financial circles, forcing a rebalancing.Some believe that the 1980s currency agreement weakened the dollar, strengthened the yen, and eventually pierced the bubble in the 1989 Japanese stock and real estate markets.The logic is that in order to strengthen the yen, the Bank of Japan (BOJ) had to tighten monetary policy, causing the bubble to burst.As always, the real estate and stock bubbles are blown out with money printing, and when loose monetary policy slows or stops, the bubble will burst.The problem is that Japanese politicians will perform financial septum to please American daimyo.
Today, like in the 1980s, there is a huge financial imbalance between Japan and the United States.Japan is the largest U.S. Treasury holder of all countries.Japan has also implemented radical quantitative easing policies and evolved into yield curve control (YCC), resulting in extremely weak US dollar-JPY exchange rates.In these two articles, I talked about the importance of the US dollar to the Japanese yen exchange rate:I don’t care“and”Thousands and Thousands of Seek》.
The truth about Trump is that the dollar should appreciate against the yen.Both Trump and Becent are well aware that this has to happen.Unlike China, China will make confrontational currency adjustments, while in Japan, Becente will determine the direction of the dollar-yen exchange rate, and the Japanese will follow.
The problem with the appreciation of the yen is that it means the Bank of Japan must raise interest rates.In the absence of government intervention, the following will occur:
1. As interest rates rise, Japanese government bonds (JGB) become more attractive, and Japanese businesses, households and pension funds will sell foreign stocks and bonds (mainly US Treasury and US stocks) to convert foreign exchange earnings into Japanese yenand purchase Japanese government bonds.
2. Rising Japanese Treasury bond yields means a decline in prices, which has a significant negative impact on the Bank of Japan’s balance sheet.Additionally, the Bank of Japan holds a large number of U.S. Treasury bonds and U.S. stocks, and the prices of these bonds will also fall as Japanese investors sell them to repatriate capital.Additionally, the Bank of Japan must pay higher interest on the yen bank reserves.Ultimately, as the process unfolds, this is bad news for the Bank of Japan’s solvency.
Trump hopes that Japan’s financial system can avoid collapse.The U.S. naval base in Japan can curb China’s maritime power, and the semiconductors produced by Japan help ensure the U.S. has a friendly supply of key components.Therefore, Trump will instruct Becent to take necessary measures to ensure that Japan survives economically with the appreciation of the yen.There are multiple ways to do this; one way is that Becent uses the power of the U.S. Treasury Department to provide the Bank of Japan with the dollar-JPY bank currency swap, so that any sell-off of U.S. Treasury bonds and U.S. stocks will be absorbed off the market.The following is my article “Thousands and Thousands of Seek》 Description of the process in 》.
Fed – They increase the supply of the dollar, or in other words, in return, they get the yen previously created by arbitrage trading growth.
CSWAP – The Bank of Japan owes the Fed dollar, and the Fed owes the Bank of Japan yen.
Bank of Japan – They now hold more U.S. stocks and bonds, and their prices will rise as the growing CSWAP balance leads to an increase in the number of U.S. dollars.
Banks of Japan – They now hold additional Japanese government bonds.
This is important for cryptocurrencies as the dollar volume will increase to fund the closing of large-scale USD-JPY arbitrage transactions.Closed positions will proceed slowly, but trillions of dollars will be issued to maintain Japan’s financial system’s solvency.
It is quite easy to correct the trade and financial imbalance between Japan and the United States, because Japan ultimately has no say and is currently so politically weak that it cannot raise any real objection.The ruling Liberal Democratic Party (LDP) lost its parliamentary majority, putting Japan’s governance into turmoil.The elites have no political ability to oppose Trump’s truth, just as they secretly hate uncivilized Americans.
EU, the last
While many Europeans (at least those not called Muhammad) have a little Christian tendency, the Bible’s saying “The last one will be the first” is absolutely not economically applicable to the EU.The last one will be the last one.For whatever reason, the elite European politicians continued to hold the position and accepted the ruthless blow from Uncle Sam.Europe should do its best to integrate with Russia and China.Russia provides the cheapest energy through pipelines and provides food to feed its people.China offers cheap, high-quality finished products and is willing to buy European luxury goods, and its quantity will even make Marie Antoinette blush.Instead of trying to integrate into the huge and unstoppable common prosperity circle of Eurasia, the European continent has long been confused by the two island countries of Britain and the United States.
Germany and France’s economies are in trouble as Europe is reluctant to buy cheap Russian gas, abandon green energy transition scams, or engage in mutually beneficial trade with China.Germany and France are the economic engines of Europe—the rest of the continent may be just a resort for Arabs, Russians (well, maybe not now) and Americans.Given how much European elites hate people from these regions, it is quite ironic, but the rich have the final say, and the poor have the right to stand aside.
This year, Super Mario Draghi (“The Future of European Competitiveness” published in September 2024》) and Emmanuel Macron (European Speech delivered in April 2024) delivered two very important speeches.If you are European, then these speeches are frustrating that both politicians rightly point out the problems facing Europe—that is, the cost of energy and the lack of domestic investment—but the solutions offered ultimately are equivalent to “we needPrint more money to fund the green energy transition and carry out more financial suppression.”The right solution is to abandon firm support for the risk-taking actions of the American elite, to achieve easing with Russia for cheap natural gas, embrace nuclear energy, engage in more trade with China, and completely relax financial market controls.Another frustrating fact is that many European voters, like me, who think the current policy portfolio is not in their best interests, voted and elected parties that want to achieve these changes.But the elites in power are trying their best to weaken the will of most people.With neither France nor Germany actually having a ruling government, political turmoil continues.
The truth about Trump is that the United States still requires Europe to avoid Russia, restrict trade with China, purchase American-made weapons to resist Russia and China’s attacks, and prevent strong integration of the Eurasian continent.As these policies have negative effects on the economy, the EU must resort to financial suppression and printing of money to maintain a balance of income and expenditure.I will explain the future of European financial policy through a few words from Macron and explain why you should be scared if you hold capital in Europe.You should worry that your ability to escape from the European capital basement will be shut down and the only thing you can buy in your retirement account or bank deposits is bad long-term EU government bonds.
Before I quote Macron, I would like to quote a passage from Enrico Leta, former Italian Prime Minister and current director of the Jacques Delor Institute, a think tank:
The EU has up to 33 trillion euros of private savings, mainly held in the form of a current account (34.1%).However, these wealth is not fully utilized to meet the EU’s strategic needs; a worrying trend is that European resources turn to the U.S. economy and U.S. asset management companies every year.This phenomenon highlights the serious inefficiency of EU savings utilization, which would greatly contribute to achieving its strategic goals if it is effectively utilized within its own economy.——Much More Than A Market
Leta has no doubt that he thinks the problem lies; Macron’s subsequent remarks reiterate these views.European capital should not be funded by American companies, but by European companies.Authorities know better than you how to deal with your capital, and they can force you to hold underperforming European assets in various ways.For example, for those who deposit money with institutional fund managers through pension funds or retirement accounts, EU financial regulators can define the appropriate investment scope so that your investment manager can only legally purchase EU stocks and bonds.For those who deposit money into banks, regulators can ban banks from offering non-EU stock and bond investments because they are not “fit” to savers.Any time your money is placed with a trustee regulated by the EU, you will be at the mercy of Christine Lagarde and her Happy Muppets and others.Maybe you like her, but don’t get me wrong. As the president of the European Central Bank (ECB), her job is to ensure the survival of EU projects financially, rather than helping your savings grow faster than her bank maintains the system’s solvency.The rate of inflation required.
If you think only the people at the World Economic Forum in Davos would advocate for such things, here’s a quote from the infamous racists, fascists, [fill in the blanks]ists… They say so… Marina LePang’s words:
Europe should be awakened…because the United States will defend its own interests more effectively.
The “Trump truth” also attracted attention in the EU’s left and right wing politics.
Back to the point that EU politicians refuse to take simple and less economic losses to solve their problems, here is what Macron said for the public:
“So the days when Europe buys energy and fertilizers from Russia, outsources it to China and rely on the United States to ensure safety are over.”
Macron continued to emphasize that EU capital must not be directed to the best-performing financial products, but must be invested in a barren land in Europe:
“The third downside: we have about €300 billion in savings each year to fund Americans, whether it’s Treasury bills or capital risks. That’s ridiculous.”
Finally, Macron said in his final hit that he would suspend Basel III banking supervision.Essentially, this will allow banks to purchase high-priced, low-yield EU government bonds unlimited.Those who hold euro-denominated assets will be the loser because this actually allows an unlimited increase in the supply of the euro.
“Secondly, we need to reexamine how Basel and solvency standards are applied. We cannot be the only economic region in the world to apply these standards. The United States was the source of the financial crisis of 2008-2010, but they chose not to apply these standards..”
Macron rightly pointed out that Americans do not abide by these global banking rules and concluded that Europeans do not need to abide by them.Hello, the collapse of fiat finance against bitcoin and gold.
In his latest report, Draghi continued to note that in addition to funding large welfare states (for example, France’s government spending accounts for the highest proportion of GDP among developed countries at 57%), the EU will need to invest 800 billion a year.EUR.Where does this money come from?The money will come from the ECB printing money, as well as EU depositors buying bad long-term EU government bonds under financial pressure.
I’m not making up this nonsense.These are direct quotes from the left and right sides of the EU political spectrum.They tell you that they know best how to invest in EU savings.They tell you that banks should be able to use unlimited leverage to buy bonds from EU member states, and eventually, the ECB will issue these bonds after issuing pan-euro bonds.And the reason behind this is the truth about Trump.If the United States under Trump is to weaken the dollar, suspend prudent banking regulations, and force Europe to cut ties with Russia and China, EU depositors must accept sub-standard returns and financial restraints.EU cowards should sacrifice their capital and their true standard of living to safeguard EU projects.I’m sure you noticed the massive rolling eyes in the tone of this section, but I won’t be angry with you if you want to lower your standard of living in Europe.I bet that many of you love waving flags in public, but at home they will rush to the computer and try to leave as soon as possible.You know, the escape is to buy and keep it yourself before Bitcoin is banned.But EU readers, this is your choice.
Globally, Bitcoin will rise sharply as the euro circulation increases and the tightening of the EU’s domestic capital.This is the established policy of the elites.However, I believe it will be a “do what I say, not what I do”.Those in power will secretly transfer their assets to Switzerland and Liechtenstein and buy cryptocurrencies on a large scale.Meanwhile, those who refuse to obey and protect their savings will suffer under government-approved inflation.This is how the croissants flake off.
The end of the truth
Our truth ends is the free cryptocurrency market 24/7.The rise in Bitcoin after Trump’s victory in early November was a leading indicator of accelerated growth in fiat money supply.To deal with the Trump truth, every major economic group/country must respond immediately.The response is to depreciate the currency and increase financial suppression.
Bitcoin (yellow) is leading the increase in U.S. Bank Credit (white).
Does this mean that the price of Bitcoin will rise directly to $1 million without any significant pullback?Absolutely not.
I don’t think the market realizes that Trump actually has very little time left to do anything.The market believes Trump and his team can create economic and political miracles immediately.The issue that led to Trump’s popularity has been brewing for decades.therefore,No matter what Elon Musk tells you on X, there is no immediate solution.As a result, it is almost impossible for Trump to fully appease his supporters to prevent the Democrats from recapturing both legislatures in 2026.People are impatient because they are desperate.Trump is a shrewd politician who knows his supporters.For me, it means he has to do a big fight early, which is why I bet the dollar would depreciate significantly against gold in the first 100 days after he took office.This is an easy way to make production costs in the United States quickly globally competitive.It will result in an immediate return of productivity, leading to an increase in recruitment today, rather than a rise in recruitment five years later.
Before we enter the collapse phase of the cryptocurrency bull market, I believe the cryptocurrency market will experience a tragic plunge before and after Trump’s inauguration on January 20, 2025.Maelstrom will cut some positions ahead of schedule, hoping to repurchase some core positions at a lower price some time in the first half of 2025.Obviously, every trader will say this and believe they can seize the market opportunity.And most of the time, they end up selling too early and then lack the confidence to rebuy at a higher price than they had just held.Then, for the rest of the bull market, the above-mentioned traders will not have enough investment.Knowing this, if the bull market is unstoppable on January 20, we will admit failure, lick our wounds and return to the bull market.The truth of Trump shows me the structural flaws of the global order.The truth of Trump tells me that the best way to maximize returns is to hold Bitcoin and cryptocurrencies.Therefore, I will buy on dips.
Yahtzee (Note: Yahtzee is a classic dice game that combines a unique combination of luck and strategy)!!!
