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Episode 108: The End Game is Here
Pre-Show
News
Adopting Bitcoin
Conference stats:
1100 attendees
350 Salvadoran
Over 150 sessions
El Salvador’s Rating Raised by S&P on Local Debt Refinancing
Tourism, a major economic driver in El Salvador, plummeted during the 2020 pandemic but has increased sharply
Economics
> When the recession or financial calamity occurs, short-end rates will fall quickly as the Fed aggressively cuts its policy rate in response. That is the “oh shit” moment. The yield curve un-inverts and then steepens (long-end rates higher than short-end rates), but it will do so while yields are generally falling. This is called a “bull steepener” and is the classic way the yield curve has moved in modern financial history.
>
> Right now, there is no US recession and no financial calamity. To the intellectually dishonest TradFi cheerleaders like Paul Krugman, the regional banking crisis doesn’t count; they will need to see a firm like Bank of America go bust to acknowledge the deep rot in the US banking system. Therefore, the market, aka bond vigilantes, expect the Fed to continue raising rates to fight inflation. But the Fed said rate hikes are paused, therefore the bull steepening scenario won’t occur. Then why should the vigilantes continue holding long-end bonds? They won’t, and they will express their view by selling long-end bonds at the margin.
> Underneath the veneer of record-breaking profits is a ticking time bomb hidden in the recesses of Too Big To Fail global banks. I’m talking about the likes of JP Morgan, Goldman Sachs, BNP Paribas, Nomura, etc. They sold trillions of notional worth of these products to desperate pension and insurance companies, and now will find themselves gushing losses larger than Three Arrows Capital. To hedge and stop the bleeding, these banks all must trade the same way. The more they hedge, the more they lose. All of this is due to the bear steepener, which is a direct result of Fed and global central banking policy. Talk about a TradFi human centipede.
Already $780bn in loses ONLY on US Tbills, btw equity in the US banking system is only $2.2 Trillion
Privacy
Exchanges in the UK want to KYC every crypto transaction for Travel Rule compliance
"From 1st December 2023, Gemini may freeze and/or restrict users who are attempting to make inbound transfers to Gemini from a non-TRUST VASP. This is due to these transactions potentially missing the required information to ensure transparency of the transaction."
Altcoins
Bitcoin Education
Feedback
Remember to get in touch [email protected] or @bitcoindadpod on twitter
Consider joining the matrix channel using a matrix client like element, details here
Thank you Boosters
If you get some value from this show, please consider sending a boost. Hearing from you means a lot to us!
Send a Boost via the Podcast Index web page. No Podcast app upgrade required.
Send a re-ocurring or one-off lightning boost to the show with no message at [email protected] or directly to Chris at [email protected]
Value for Value
Sponsors and Acknowledgements
Music by Lesfm from Pixabay
Self Hosted Show courtesy of Jupiter Broadcasting
View all episodes
By The Bitcoin Dad
4.9
99 ratings
Pre-Show
News
Adopting Bitcoin
Conference stats:
1100 attendees
350 Salvadoran
Over 150 sessions
El Salvador’s Rating Raised by S&P on Local Debt Refinancing
Tourism, a major economic driver in El Salvador, plummeted during the 2020 pandemic but has increased sharply
Economics
> When the recession or financial calamity occurs, short-end rates will fall quickly as the Fed aggressively cuts its policy rate in response. That is the “oh shit” moment. The yield curve un-inverts and then steepens (long-end rates higher than short-end rates), but it will do so while yields are generally falling. This is called a “bull steepener” and is the classic way the yield curve has moved in modern financial history.
>
> Right now, there is no US recession and no financial calamity. To the intellectually dishonest TradFi cheerleaders like Paul Krugman, the regional banking crisis doesn’t count; they will need to see a firm like Bank of America go bust to acknowledge the deep rot in the US banking system. Therefore, the market, aka bond vigilantes, expect the Fed to continue raising rates to fight inflation. But the Fed said rate hikes are paused, therefore the bull steepening scenario won’t occur. Then why should the vigilantes continue holding long-end bonds? They won’t, and they will express their view by selling long-end bonds at the margin.
> Underneath the veneer of record-breaking profits is a ticking time bomb hidden in the recesses of Too Big To Fail global banks. I’m talking about the likes of JP Morgan, Goldman Sachs, BNP Paribas, Nomura, etc. They sold trillions of notional worth of these products to desperate pension and insurance companies, and now will find themselves gushing losses larger than Three Arrows Capital. To hedge and stop the bleeding, these banks all must trade the same way. The more they hedge, the more they lose. All of this is due to the bear steepener, which is a direct result of Fed and global central banking policy. Talk about a TradFi human centipede.
Already $780bn in loses ONLY on US Tbills, btw equity in the US banking system is only $2.2 Trillion
Privacy
Exchanges in the UK want to KYC every crypto transaction for Travel Rule compliance
"From 1st December 2023, Gemini may freeze and/or restrict users who are attempting to make inbound transfers to Gemini from a non-TRUST VASP. This is due to these transactions potentially missing the required information to ensure transparency of the transaction."
Altcoins
Bitcoin Education
Feedback
Remember to get in touch [email protected] or @bitcoindadpod on twitter
Consider joining the matrix channel using a matrix client like element, details here
Thank you Boosters
If you get some value from this show, please consider sending a boost. Hearing from you means a lot to us!
Send a Boost via the Podcast Index web page. No Podcast app upgrade required.
Send a re-ocurring or one-off lightning boost to the show with no message at [email protected] or directly to Chris at [email protected]
Value for Value
Sponsors and Acknowledgements
Music by Lesfm from Pixabay
Self Hosted Show courtesy of Jupiter Broadcasting