Sebastian Bunney sits down with Cedric, the host of the Bitcoin Matrix podcast to discuss:
- How Bitcoin represents a threat to the United States dollar and its global hegemony backed by endless war
- What Saddam Hussein, Hugo Chavez, Muammar Gaddafi and Bitcoin may have in common
- Economic hitmen, jackals, the U.S. military and behind the altruistic curtain
- Why does the Federal Reserve target inflation?
- What do the military and counter-terrorism have to do with protecting the inflation narrative?
- How come bitcoin sees such strong opposition from certain individuals within the government?
- Is unemployment such a bad thing?
- What are the effects of inflation?
- Why someone would ever lend money at interest rates below that of inflation?
- Where does Bitcoin stand in all of this?
so because the dollar is a reserve currency, the U.S. has been able to increase its money supply to target growth because the devaluation pressure is split among a large number of entities outside the U.S. as well. Is that a correct statement?
Hey Sahil,
I would rephrase it slightly and say that all countries seem to want to target growth. However, how they go about achieving that growth is a different story. The US benefits from being the world reserve currency as it can, as you say, “increase its money supply to target growth because the devaluation pressure is split among a large number of entities outside the U.S.”
This is an immense benefit to the US as its currency is propped up due to other countries’ reliance on the USD for trade. This reliance/demand is why even throughout all this expansion in the money supply we haven’t seen a major decline in the purchasing power of the USD.
thank you, that makes a lot of sense, so is that also a reason why the U.S wouldn’t want to increase interest rates coz if it does so then the cost of borrowing dollar would be high, and it wouldn’t be a reserve currency anymore.
I’d say that they are conscious of raising interest rates as:
1. Raising rates tends to strengthen the dollar which causes global economic pain
2. Raising rates makes the US less favourable and as it stands the US has run a deficit in 19 of the last 21 years which means it is reliant on debt in order to function.
So yes in a way they are conscious of interest rates as raising them too high could make the USD unfavourable in addition to causing major economic pain.