Macro Market Conditions: Synergy Fund thinks about Bitcoin

in #fund4 months ago

What a crazy world we live in! As we read the news of nationwide protests in the US and digital dollar legislations, we can't help but remember that apart from the technicals, there is something very fundamental going on right now.

We did not start the Synergy Fund just to engage in speculative motions to attempt to capture value from a zero sum pie. We are investing in an 'asset class' that is able to change the way we organize human society for the better.

There are possible distopian outcomes, but true decentralization, and our dream of 'One Million Villages' has never been closer.

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Image Credit: CoinDesk Article: First Mover - Traders don't care that Goldman Hates their Asset Class

When we first came upon the above image it seemed to clear that while Bitcoin took a dive in March's liquidity crunch sparked by fear, it effectively delivered a pile driver into the spine of the traditional banking system, from which it will not be looking back from anytime soon.

Certain cycles have aligned, and we see analysts looking to the great depressions and stagflationary periods of the past to get some idea of what the future may hold. What is clear is that there is a big worldwide credit bubble yet to burst and an unstable geopolitical landscape between East and West.

The first World War, known as The Great War, was also the result in a long run of Globalization. At the start of the War, the World was more open than it had ever been before, presided over by the self-declared benevolent British. Looking at our world today, I suddenly wonder, if the British were so benevolent, why did it all end in 'The War to End All Wars'?

We now have lived through a period of great balance sheet prosperity, our decadence surely to be remarked upon by future anthropologists, and as the cycle always turns it is now time for us to suffer a bit.

Suffer?? We already had it tough!

Yes grueling peasants in the feudal age would hardly note the difference between boom and bust, except for perhaps that in the bad times the taxes imposed by their noble lords were greater upon them. Austerity! It is time for belt tightening, says no one, as the bankers decide to soften the blow with free money.

Free Money, to Buy Moderna Stock with?

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Many rage against 'Capitalism', and we would rage too, but we know the true ills are market failures. 'Crony Capitalism' might be a modern way of declaring the age old reality of 'the insiders rig the game'. A true study of capitalism will show that it is exactly what happens when two people, who have equal footing of information and opportunity, get together to make a deal that will benefit them both. That hardly sounds like what is happening today.

When a market fails to price in the negative costs associated with certain actions, this is called a 'negative externality'. It is only one type of Market Failure. Imperfect (asymmetric) information, imperfect competition (monopolies, collusion, oligopolies) and Non-Existing Markets are all examples of failures, not failures in capitalism but failures to 'have capitalism', that is failure to have perfect markets. Markets provide good outcomes when they are perfect. The degree to which they are imperfect always affects the degree to which they produce good outcomes.

The way to fix these markets is always to work more locally. Local is not the opposite of global. It is a different scale. Local companies can operate globally, but they must be local first. As we have seen in the past 50 years, we have made incredible strides in opening up the world's supply lines globally, but we have weakened our local markets and production capacity. This has happened because the market failed to price in local resiliency. This is a very valuable attribute in times of pandemic, or other crises.

There are many problems with our Global system, but we now have a chance to choose another way. We can step outside the 'Global Financial System of Control' and choose a decentralized currency, a currency of freedom. We can trade with and invest in better systems.

Its our choice.

This is not advice. It is history. Do your homework.

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