Listen to the audio version of this news roundup wherever you get your podcasts: https://bitcoinpodcast.net/podcast

Greetings and salutations my fellow plebs. My name is Walker and this is THE Bitcoin Podcast.

It’s Wednesday, August 16th, 2023. At the time of recording, the Bitcoin block height is 803,506 and the value of one Bitcoin is still one Bitcoin. 

Today’s episode is the weekly Bitcoin News Roundup. I’m going to go over the big stories of the week, run through a few rapid fire news, then zoom out and talk about Bitcoin volatility and narrative shifts.

You can find all the links and accounts mentioned in this episode via the article version of this show, linked in the show notes, or by going to bitcoinpodcast.net/words

Without further ado, let’s get into it.

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Bukele, Bonds, & Bitcoin

Via Bloomberg: Bitcoin-Touting Bukele’s Bond Rally Draws JPMorgan, Eaton Vance

  • El Salvador global bonds have returned over 70% this year
  • President has signaled willingness to pay sovereign debt

Quoting Bloomberg: “El Salvador President Nayib Bukele scared off many on Wall Street by embracing Bitcoin. Two years later, the bond rally he’s overseeing is proving too lucrative to resist.”

You really love to see this. El Salvador, a small nation that until a few years ago was more famous internationally for its gang violence than it’s beautiful beaches, has seen an incredible reduction in crime, massive increase in tourism, and after giving the middle finger to the IMF, is proving that a Bitcoin standard is not only possible, it’s profitable. 

I’ve been to El Salvador twice and I must say, it’s an amazing place. Are there still problems? Of course. Nowhere is perfect. But the amount of positive change in such a short time is hard to ignore. If you ever get a chance, I highly recommend visiting. I promise the pupusas taste even better when you pay for them in Bitcoin. 

Bitcoin on the Ballot

Via Bitcoin Archive: Pro-Bitcoin Presidential Candidate Tops Argentina’s Primaries: Javier Milei’s Unexpected Victory

Here’s an overview from bitcoinarchive.co:

Javier Milei, a libertarian economist, has emerged as the biggest vote-getter in Argentina’s primary election, securing 30.5% of the vote, leading to speculation the nation will be the first G20 nation to adopt Bitcoin as a reserve asset.

The primary result for Milei was far higher than expected, with the main conservative opposition bloc trailing at 28%, and the ruling Peronist coalition at 27%.

The outcome is a significant blow to the centre-left Peronist coalition and the main Together for Change conservative opposition bloc. Argentina’s economic crisis, marked by 115% inflation, has led to widespread discontent. The recent primary election results have had an impact on the market, with Argentine bonds dropping by 12% on Wall Street.

Milei declared in his victory speech, “we are the true opposition. A different Argentina is impossible with the same old things that have always failed.”

Milei, 52, has attracted support by calling for Argentina to replace the peso with the US dollar and also for his support of Bitcoin.

Zooming out, I think we’re going to see a lot more pro-Bitcoin candidates emerge in the next couple years. Hell, we even have at least three pro-Bitcoin candidates on both sides of the aisle running for president in 2024. We even have RFK Jr. and Vivek accepting donations to their campaign in Bitcoin via the Lightning Network. 

In retrospect, it will be clear that being anti-Bitcoin is just bad politics. 

I’ll leave you with a quote from Milei:

“The Central Bank is a scam. Bitcoin represents the return of money to its original creator: the private sector”

Central Bank Shenanigans

Speaking of central banks and Milei, after the results were announced, Argentina’s central bank did something interesting: they devalued the peso and hiked rates… via Reuters: Argentina raises interest rate, devalues peso after shock primary election.

As Sam Callahan pointed out on Twitter: A pro-Bitcoin candidate that wants to end the Central Bank of Argentina wins a key primary election, and the government response is to devalue the currency 18% overnight. Unbelievable… It's a bold strategy, Cotton. Let's see if it pays off for them. Meanwhile, Bitcoin just made new all-time highs against the Argentine peso.

But it’s not just Argentina’s central bank that’s doing it’s citizens dirty: As Sam Callahan pointed out: A recent audit of the Bank of Lebanon showed:

  1. Officials likely embezzled over $300 million to family members and close associates
  2. They implemented a nationally-regulated Ponzi scheme to explode the national debt 
  3. They hid $76 billion in losses from the Ponzi scheme by cooking their books, failing to meet basic accounting standards

Meanwhile, the Lebanese pound has lost 98% of its value against the dollar, inflation sits at 254% YoY, and many Lebanese have been driven into poverty.

But wait, there’s more! Lyn Alden posted a thread about Egypt and it’s currency, here it is:

Heading back to Egypt for the rest of the summer. Over the past 18 months or so, the Egyptian currency has been cut in half relative to the dollar. So my little wad of cash that I had lingering from last time that I will be bringing with me is worth less. 1 USD = 31 EGP

Egypt needed an IMF loan to keep their dollar-denominated debt in working order. And one of the conditions from the IMF was to devalue the currency, to try to improve import/export balance.

It makes people poorer, but then (arguably) more competitive in the global labor market.

In other words, a devaluation makes it harder for people to import stuff, makes Egyptian vacations cheaper for foreigners, makes Egyptian exports cheaper and thus maybe more competitive, etc.

It is early but so far, no impact. That’s one way that inflation tends to hurt the working/middle class in any country. 

Inflation puts the challenge on the workers to negotiate higher wages just to keep up. And the higher the inflation, the harder the anchoring bias is to overcome.

When inflation was 9% in the U.S. a little while ago, workers basically got a pay cut unless they got a 9% raise.

But it’s easy for an employer to ask “why are you worth 9% more than last year?” But the employee is not; they are just trying to tread water on real wages.

Even 3% per year presents an issue.

A wage earner goes to employer and asks for a 5% raise.

“Why are you worth 5% more than last year?”

“I am not. I am worth 2% more due to experience, plus 3% inflation.”

People often have to switch jobs to get out of that anchoring bias.

And then of course CPI is a mix of scarce things (houses, meat, fuel, etc) and abundant things (software, electronics, grains, etc).

The price of scarce things structurally goes up faster than CPI.

So the inflation treadmill tends to be stacked against the wage earner.

Official inflation in Egypt is 37% from a year ago, while the price of meat is up 93%

U.S. Inflation & CPI

Sticking on the theme of inflation, on August 10th, the Bureau of Labor Statistics reported July CPI numbers, putting inflation at 3.2% year-over-year. 

Here’s the thing: CPI is an arbitrary basket of goods which can be (and is) changed in order to make inflation look not quite as shitty as it really is. Additionally, CPI in July 2022 was 9.1%. So when you hear politicians celebrating because “inflation is coming down,” remember that they’re talking about the year-over-year change. So yeah, prices only increased 3.2% on top of the 9.1% last year. Furthermore, anyone who buys groceries or gasses up their car knows that their money is buying less and less, their purchasing power is declining. Politicians will always try to put lipstick on an inflationary pig, but it’s still a pig. 

I don’t want to rant about inflation too much, because I could go all day. I’ll leave you with this: inflation is not “caused by prices rising.” Inflation is caused by inflating the quantity of money. To quote Mises: “if you increase the quantity of money, you bring about the lowering of the purchasing power of the monetary unit.” 

If you want to learn more about the nature of inflation, check out this week’s Bitcoin Out Loud read on inflation by Ludwig von Mises. 

Tricky Dick Nixon

I know I said I was done talking about inflation but I lied. Because yesterday, August 15th, marked the 52 year anniversary of Nixon suspending “temporarily” the convertibility of dollars to gold. This was the final nail in the coffin for the gold standard, and marked the beginning of the U.S. dollar as a pure fiat currency. 

Here’s a short clip from Nixon’s speech in 1971: “Your dollar will be worth just as much tomorrow as it is today.”

If you want to know more about the effects of this 1971 decision, check out wtfhappenedin1971.com

Your Dollar Ain’t Shit

On August 10th, a song called Rich Men North of Richmond by Oliver Anthony went viral. Originally posted to YouTube on the RadioWV channel, it quickly made the rounds on twitter. 

This song clearly struck a chord with people, because Oliver tapped into a feeling that is pretty much universal in the era of fiat money printed by central banks: your money buys less and less every year, no matter how hard you work. And no one is coming to save you, especially not the folks in D.C.

Rich Men North of Richmond has been the talk of the virtual town for the past week, so I won’t spend too much time on it. Instead, I’ll just play the song for you, because Oliver’s music speaks for itself. 

Oliver’s YouTube Channel

Rich Men North of Richmond by Oliver Anthony (Lyric version)

RadioWV 

If you want to follow Oliver, he’s @AintGottaDollar on Twitter. Hopefully we’ll get him on Nostr soon so we can start zapping him some Bitcoin. 

Rapid Fire News

These first three headlines are via Bitcoin Archive:

Via Daniel Batten: $50 Million financing Bitcoin mining using vented emissions of landfills as fuel achieves the same emission reduction as a $2.2 Billion financing photovoltaic development

Via CNN: The typical American household spent $709 more in July than they did two years ago to buy the same goods and services, according to Moody’s Analytics

Via Glassnode: Number of Non-Zero Addresses just reached an ATH of 48,039,035

And finally, via Michael Saylor on August 11th: Three years ago today MicroStrategy announced that it had adopted #Bitcoin as its Primary Treasury Reserve Asset, purchasing 21,454 BTC for $250 million, or ~$11,653 per Bitcoin.

*****

Zoom Out

To wrap up today’s show, let’s zoom out, and talk about Bitcoin volatility and perspective.

I’ve seen several headlines about Bitcoin from legacy financial media this week that are just too hilarious not to mention.

Here’s the first from Bloomberg: Bitcoin’s Extreme Volatility Vanishes Amid ‘Extreme Apathy and Exhaustion’

  • 90-day volatility at lowest since 2016, Bloomberg data show
  • Bitcoin has hovered around $29,000 throughout August

And here’s another one from Barron’s: Bitcoin and Other Cryptos Languish. ‘Has Bitcoin Failed?’ Asks Analyst.

  • It was more of the same from Bitcoin and other cryptocurrencies on Monday as digital assets continued to languish at relatively depressed levels amid a period of historically low volatility. The lack of action is starting to unnerve some market observers.

Now, you may be wondering “what’s so funny about these headlines?”

Well, it’s funny because it’s emblematic of the legacy media still having no idea what to think about Bitcoin, and instead of writing anything of substance that’s actually worth reading, writing vapid clickbait headlines. 

For many years, the legacy media bemoaned the fact that “Bitcoin is too volatile,” or “Bitcoin’s volatility makes it too risky!”

Now their complaint is basically that “Bitcoin is too boring.” I mean, the Barron’s article literally says “Has Bitcoin Failed?” in the headline. Of course, Bitcoin has been pronounced “dead” by the legacy media 474 times in its 14 year history, so this is nothing new. 

Here’s the reality: 

  • Bitcoin is currently hovering just over $29,000. 
  • It’s up over 70% year-to-date. 
  • It’s up around 300% over the last four years. 

The legacy media types may think this is boring, but to my fellow plebs out there and I would say: this is the calm before the storm. Bloomberg mentions that the 90-day volatility is at the lowest since 2016. In 2016, Bitcoin was under $1,000 dollars. In 2017, it rose to almost $14,000 dollars. 

The Bitcoin greed and fear index is currently at 52, meaning Neutral. It’s funny how short attention spans are these days. Bitcoin stays stable in USD terms for a couple months and some smooth-brained financial journalists view it as a negative. Meanwhile, plebs are out here stacking sats in preparation for the next Bitcoin halving in April 2024. 

It’s also a matter of perspective, because if you’re in Turkey or Argentina, which are both experiencing horrific inflation, Bitcoin is at an all time high. 

And that’s the point: perspective. Bitcoin is only “boring” at times or “volatile” at times when you price it in terms of fiat currencies over the short term, and fiat currencies themselves are inherently volatile. 

Here’s the difference between Bitcoin and fiat: over the long run, Bitcoin’s volatility is to the upside. Fiat’s volatility is to the downside. If you look at Bitcoin through the lens of the dollar over the last 90 days, it’s boring. If you look at Bitcoin through the lens of the Argentine Peso over the last 90 days, it’s definitely not boring. But you shouldn’t be looking at Bitcoin with only a 90 day time horizon anyway. You should look at Bitcoin in terms of years and decades, not days and months. Bitcoin isn’t about getting rich quickly, it’s about saving wealth slowly. Saving the value of your time and energy, of your hard work.

So, zoom out. We say “1 Bitcoin = 1 Bitcoin” for a reason. It’s because no matter what the price of Bitcoin is on any particular day in fiat terms, you always know that the value of one Bitcoin is one twenty-one millionth of all the Bitcoin that will ever exist. 

So relax, create value, stack sats, remember that you will die, and go touch some grass. Bitcoin isn’t going anywhere, and very soon you may wish for more of these “boring” days. 

*****

And that’s a wrap on this week’s Bitcoin News Roundup.

You can find the written version of this show along with all the references via the link in the show notes or by going to bitcoinpodcast.net 

You can find me on nostr by going to primal.net/walker

If you want to follow THE Bitcoin Podcast on Twitter, go to @titcoinpodcast and @WalkerAmerica. 

You can also find the video version of this podcast at https://youtube.com/@WalkerAmerica 

Bitcoin is scarce – there will only ever be 21 million–but Bitcoin podcasts are abundant. So thank you for spending your scarce time to listen to another fucking Bitcoin podcast. 

Until next time, stay free

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