I write this amidst a pandemic! The Coronavirus from the wet markets of China has erupted into a massive pandemic. As of this writing, the official numbers are:
1,270,069 Confirmed cases
69,309 Deaths
259,810 Recovereries
Because the lack of mass testing, these numbers are hard to trust. Since the disease can be asymptomatic, I think the actual cases are much higher. With many people not even knowing they are carrying the virus. For the deaths, again, not enough testing and imprecise definition for the category. China tallies up COVID-19 positive deaths in their official numbers regardless of the actual cause of death e.g. a building collapse killing 6 confirmed patients and even casualties from car accidents. Many countries are reporting 0 or surprisingly few cases, which is misleading the public into a false sense of security. More testing needs to be done!
The western countries have been hit the hardest, with the US now leading the world in the total number of cases. I think this is a testament to mass testing, not a worse outbreak. With over 300,000 cases, the country is running out of ventilators and other medical equipment. The top doctors of the United States has projected over 100,000 deaths! Currently the majority of the country, along with Canada is under strong Stay Home guidance from it’s governments. Non-essential workers can’t go to work and must apply for unemployment insurance if their employers cannot keep them in the payroll. The unemployment rates are literally going through the roof:
These numbers were from 3 days ago, and is already way out of date, today’s numbers are over 10 Million! On top of record unemployment rates, the stock markets have tanked hard and many other assets have followed suit. Not only do the people need a bailout, but also many many businesses.
And the governments are responding:
I said in my previous post that bureaucrats have a button that prints money, well that just didn’t do it fast enough. As pictured above, they’ve strapped on an erganomic handle on that printer and have made it much more efficient to meet their target of Trillions!
The United States government has signed into law the CARES Act that prints $2 Trillion. Two. Trillion. Dollars. Even more scary, this is just the start of the money printing. As workers continue to stay home and businesses close their doors, there will be more and more need for helicopter money from the governments.
Now why would anyone care that the government is printing money, after all, it is going to a good cause - to help the people and businesses weather the storm? Well, if you hold any amount of money in the currency being printed, the value of your money is being sucked out with every new unit of that money that is created. Your percentage of ownership of the total supply of that money keeps dropping.
How do you stop this theft of your buying power? You can opt out of the system. You can convert the easily printed money to a hard money. In the past, many chose gold as their hard money because there is no button (or handle) that just prints more gold. The gold miners have to extract the precious material out of the earth in order to create more supply. Unfortunately, we’ve seen the run-to-gold already and most gold dealers are out of stock, the reasons maybe folks buying mass quantities or disruptions in their supply chain caused by the virus.
I humbly propose another hard money, a run-to-Bitcoin. A hard money that also is lacking a “print” button and it cannot run out of stock. A money that is secure, limited in supply, easy to hold and above all, has incredible potential in the future. Of course, Bitcoin is not immune to the market movements caused by the virus, it has dropped from recent highs of ~$10,000 USD to as low as ~$3,500 and then recovering to it’s current price of ~$6,700.
The monetary policy of Bitcoin is not controlled by politicans signing pieces of paper. Nor is it controlled by the efforts of land surveyors and mining machinary. The rules for creating new bitcoins are software policies that have been in place since the very creation of the Bitcoin network, and the rules cannot be changed. A bitcoin holder needs not worry about the whims of bureaucrats, or anybody, actually. The percentage of the total supply that she owns will not change. If she is a holder of 1 bitcoin, that will always be 1 out of the 21 Million that can ever be created.
Coincidentally, as governments debase their currency like never before and call it Quantitative Easing, Bitcoin will see a qaudrennial (once in 4 years - I had to google this too) event in May, 2020 - a miner reward “Halvening”. The amount of new bitcoins being created every 10 minutes will be halved. Instead of 12.5 shiny new bitcoins being granted to the miner, it will 6.25. An event lovingly called the Quantitative Hardening. It will be interesting to see which of the 2 complete opposite monetary policies will serve the holders of the respective monies best.
Bitcoin is the optimum opt-out. It is the peaceful rebellion against the money printers.