Bitcoin represents a potential separation of money and state, addressing issues like inflation-driven short-term orientation and limitless government overgrowth.
Money functions as an economic telecommunication system, coordinating human action towards productive ends for tens of thousands to millions of people.
The evolution from pharaoh godkings to constitutional republics acknowledges individual rights, but the world has been distorted by debt and deception.
Bitcoin’s fixed supply of 21 million coins by 2140 is maintained through difficulty adjustments every 2 weeks, creating an unbreakable monetary agreement.
As a digital, non-physical money, Bitcoin can move at light speed and is non-seizable, making it ideal for preserving freedom and property rights.
Bitcoin mining acts as a global bounty program for cheaper energy, driving down costs and increasing network security through competition.
Hard money (market-selected, difficult to produce) promotes delayed gratification, savings, and long-term relationships, while fiat currency creates debt traps and fragility.
Material incentives, particularly money, significantly influence human character development, with honest money promoting virtue and corrupt money leading to unethical actions.
The fiat paradigm enables manipulation of media narratives, funding of endless wars, and suppression of dissent through propaganda and rhetoric.
Bitcoin has achieved a $2 trillion market cap with 0% industrial use, making it 100% money with an unprecedented monetary premium.
Bitcoin’s immutable time chain preserves freedom of expression by allowing uncensorable messages to be inscribed, functioning as the largest distributed information network.
Bitcoin offers the most inviolable social agreement ever, making private property rights extremely difficult to break and enabling individual empowerment.
The US Constitution enumerates sacrosanct rights like freedom of speech and bearing arms, maintaining a symmetry of power projection among people.
Natural law principles reduce to “do not steal,” encompassing life, freedom, and property, reflecting human nature and the basis for just social institutions.
Private property rights, learned through eons of bloodshed, enable division of labor and specialization, increasing aggregate output through cooperation.
Wealth can be broadly defined as means at one’s disposal to achieve aims more quickly, with money being the most marketable good in an economy.
Universal human ends include being alive, fed, sheltered, and having loving relationships, with valuing being an epiphenomenon of choosing ends.
Pricing in ideal money reflects market factors like labor and skill rarity, enabling fair compensation for services and appropriate spending.
Perpetual warfare has been enabled by fiat money printing, funding destructive wars like WWI and WWII by lifting limits on war chests and duration.
Lower time preference leads to longer time horizons and consideration of long-term consequences, fostering the creation of flourishing civilizations.
Summary
Proposed 25% tariff on physical gold imports could cause chaos in US markets, potentially leading to a COMEX collapse and shifting gold trading to tariff-free jurisdictions like London, Dubai, or Singapore.
The profitable carry trade of buying gold in London and selling futures in New York, currently yielding $20/oz, would be destroyed by tariffs, reversing the recent gold flow from east to west.
While tariffs wouldn’t affect gold’s price trend, driven by central bank risks, they would make US gold investments less attractive due to wider spreads and larger discounts when selling.
Basel III regulations make gold holdings unattractive for banks, requiring 85% long-term stable funding, leading many bullion banks to exit the business.
Tariffs could force market makers out of the US, potentially causing a complete market move abroad while maintaining financial operations in New York.
The gold flow reversal since the election, driven by the carry trade, highlights the interconnectedness of global gold markets and the potential impact of policy changes.
Gold is outperforming risk assets, reaching record highs above $3,200 per ounce while US equities, copper, and crude oil tumble, signaling a profound macro shift.
The Bitcoin to gold ratio is breaking down, with massive inflows into gold ETFs ($10-20 billion in Feb-Mar-Apr) and outflows from Bitcoin ETFs ($5 billion) indicating a shift in investor sentiment.
A global recession is unfolding, with the commodity complex showing signs for years, as China faces US tariffs and export challenges.
The US stock market is in a profound reversion cycle, with Bloomberg economics expecting the S&P 500 to decline to 4,000, while gold and long bonds are projected to outperform.
The Fed’s easing policy has created excessive liquidity, leading to inflation, and now they’re constrained by sticky inflation, notably from the wealth effect.
The traditional safe haven structure is being tested, as gold outperforms both sovereign debt and crypto, with the gold to US long bond market ratio at its most expensive ever.
The US stock market is at its most expensive ever versus MSCI US, with a potential valuation peak already passed, and gold possibly rallying towards $4,000.
ETF flows signal a smart money shift towards treasuries and gold, indicating a changing landscape in investor preferences and risk perception.
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