Long-time Bitcoin advocate and Wall St. vetern Caitlin Long joins me for one of my favorite conversations in the history of this podcast. We try to come to grips with contradictory behavior from the Federal Reserve and the reasons why these moments are so critical to the future of not just money but humanity itself.
Caitlin on Twitter
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Podcast Episode #136 — Ted Oakley and Remaining Flexible During Market Confusion
Podcast Episode #135 — Vince Lanci and How We Return to Gold-Backed Money
Podcast Episode #134 -Lynette Zang and What Monsters Lurk Under the Banking System’s Bed
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Tom, what happens when the indebted nations wake up to the fact that their debt is a ponzi and if they default, declare Jubilee and they can turn away from the $ without consequences.?
There will be consequences. To make it work, which Caitlin and I didn’t go into, is to recapitalize the country by either remonetizing gold and/or bitcoin to transfer wealth back to the people or write down the existing debt after subtracting out the interest paid, per Armstrong’s arguments about what Julius Caesar did.
Those are two mechanisms. There are others that can be deployed in concert, but it takes willing participation of the political and financial classes…. it’s unlikely to happen unless the alternatives are far worse.
Loved the conversation with Caitlin. While listening I think I stumbled on a potential answer to your mutual question: why is Fed smacking Crypto from M1 to M3…
They want to control M1, I.e. kill Eurodollars and other places USD is created outside their control, and bring control back in house. I believe to fulfill faith in their Ponzi.
They understand that there is a global market need for a reserve currency for international trade and settlements. They prefer this to be USD based vs BRICS/Yuan style solutions. Crypto with open ledger system allows for rapid, publicly viewable USD based international transactions. It is also generally self regulating to parity with USD/Fed controlled SOFR style systems. = Bitcoin/Stocks market/fed balance sheet correlation (causation yet to be determined…)
Also, being a person that has made a career fixing broken systems from the inside of the bureaucracy, I have learned that the persistent patience of a few tugboats can move the whole iceberg without anyone knowing, but if you publicly crash into it, you die and sink. So the Fed can still be DiMartino’s bumbling bureaucratic morons, but also have a few key actors, acting over long patient years, steering the whole system into a different direction. The Davos overloads have been so busy steering all of their icebergs, I think they’re just waking up that the Fed has actually been driven on a different course than MMT plan, and it’s about to get wild. So from the outside, it will look stupid business as usual, but suddenly the iceberg is in a different ocean.
I think that’s where I was landing by the time we were finished. Also, as I said late in the podcast, the key here isn’t Eurodollars it is Eurodollars capable of excessive leverage that the Fed wants wrung out of the system. If you stop there, then the answer may be right in front of you. But, that’s been my thesis all along so I’m biased.
Help my dumb self find the way to your patron site. I’ve been from ZH to your website to WordPress to JetPack… still not seeing the link
Follow the goat in the right gutter or the link at the bottom of every article or well.. this one.
Hi Tom, yours and Caitlin’s comments about the Fed doing the right thing in 2008 not leading to inflation etc reminded me of Prof Richard Werner’s comments at 60-75min in this video of the PBD Podcast where he explains just that and uses 2 other examples of Japan 1945 and UK Aug 1914 where the BOJ & the BOE “decided now was not the time to have a banking crisis” and recapitalised their banks.
Best regards, Stuart
The video is titled ‘The Father of QE – Richard Werner’ on YT
Thank you Stuart!
I think you stated that you are in Gainesville. Ever heard of an attorney in your city named Jeff Childers? He is as brilliant as you are, in a different category. This is his latest:
Just sharing. Thought you might find interesting.
No I haven’t heard of Jeff. Weird he must not advertise
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