Money Is POWER

Last Updated: 26 May 2024

Paul—we look at all these macro issues from sort of an abstract investor perspective. But what’s going on underneath it is very real.

You had some nice links there, and reflecting on history can always lend a sobering perspective to the current outlook. As I’ve mentioned, I find currencies endlessly fascinating, because their shifting rates are reflective of a whole range of issues, including macroeconomic fundamentals, currency flows and market psychology.

One of the most interesting recent phenomena has been the relative continued strength of the dollar and of U.S. Treasuries through an absurdly woeful set of fundamentals for the currency, including enormous current account and trade deficits. Partly (especially since October) that has had to do with deleveraging bets and buying back dollars to pay back loans made in that currency, as well as a retreat toward quality (forgive me the snicker). But above all, the dollar’s strength has been about China agreeing to fund the enormous U.S. deficit.

China has quietly built a massive economy on the back of this “18 months NO MONEY DOWN” financing. The shrewdness of that is only magnified by the fact that as a side benefit, China OWNS the U.S. now. How much screeching have you been hearing from the U.S. government about human rights and the like of late?

That’s because when the U.S. government asks itself the question, “Who’s your daddy?” the answer is China.

Author
  • Luke Handt

    Luke Handt is a seasoned cryptocurrency investor and advisor with over 7 years of experience in the blockchain and digital asset space. His passion for crypto began while studying computer science and economics at Stanford University in the early 2010s.

    Since 2016, Luke has been an active cryptocurrency trader, strategically investing in major coins as well as up-and-coming altcoins. He is knowledgeable about advanced crypto trading strategies, market analysis, and the nuances of blockchain protocols.

    In addition to managing his own crypto portfolio, Luke shares his expertise with others as a crypto writer and analyst for leading finance publications. He enjoys educating retail traders about digital assets and is a sought-after voice at fintech conferences worldwide.

    When he's not glued to price charts or researching promising new projects, Luke enjoys surfing, travel, and fine wine. He currently resides in Newport Beach, California where he continues to follow crypto markets closely and connect with other industry leaders.

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