I grew up believing in American exceptionalism. That the U.S. was better than other nations. That’s what I was taught. When I looked around, that’s what I saw. But among many other lessons, Trump has taught me that the U.S. is a banana republic, just like most other/every other nation in the world. And that actually makes a lot more sense. After all, who are we to be special? I think we had a good run. A great run. A run for the ages. But it turns out, things work until they don’t,
So if we’re a banana republic, just like everyone else, is there anything to believe in?
Well, a lot of people are religious. Over five billion people adhere to the three largest religions. Now, most of these people haven’t seen God. But they have faith. They believe God exists. Most will say they know God exists. And that works for them. That gives them solace.
I believe in karma. The physics of life. That, for the most part, what we put out there, is what we get back. Sure, some good people get hit by buses, and some bad people win the lottery (or get to be President), but most people I know, owe their lot in life to karma.
But even if you are religious, or believe in karma, most people need to live their lives believing in other things they can’t see. From an economic standpoint, most people have faith in their countries’ currency. That the money they have in their wallet or bank will enable them to basically by the same amount of good tomorrow, or next month, or next year, as it does today. There is no proof of that. But that’s the way it worked yesterday, and last week, and last year. So most people assume it will continue to work. It’s just faith. And it’s that faith, that enables every currency to function, without being backed by anything. At the end of the day, every currency is simply a confidence game.
But some people don’t have faith in their countries currency. They’ve lost confidence.
If you live in Venezuela, you probably don’t have faith in your currency:
In 2016, Venezuela entered hyperinflation. The inflation rate reached 274% in 2016, 863% in 2017, 130,060% in 2018 and 9,586% in 2019. Since 2016, the overall inflation rate has increased to 53,798,500%
And Venezuela has nothing on Zimbabwe:
Zimbabwe’s peak month of inflation is estimated at 79.6 billion percent month-on-month, 89.7 sextillion percent year-on-year in mid-November 2008.
Most people see that and think, well, they’re banana republics. Run by uneducated despots.
But The U.S. Is Different
Yes. The U.S. is different. The world works on the dollar. And as a result, today, we can print as much money as we want:
And because we can print as much money as we want, we completely ignore any fiscal responsibility and pile up tens of trillions of dollars of debt:
Spoiler alert. We’re not paying back our debt. But the debt is only a small part of it our fiscal problem. Turns out we have over $100 trillion of unfunded liabilities (commitments the government has made for things like Social Security and Medicare that it doesn’t have the money for):
I get why people have faith in the U.S. dollar. It worked yesterday, and last week, and last year. And it could work for another 100 years.
But things work until they don’t.
And when the U.S. dollar eventually stops working, everyone will say, “OF COURSE”. Because everyone knows that Ponzi schemes have a half-life. And everyone knows, when they open their eyes, that the U.S. has been a Ponzi scheme for years (paying back old debt with new debt, the definition of a Ponzi scheme).
So it’s not a matter of if, it’s a matter of when, you, and everyone else, will lose faith in the U.S. dollar. I’ve already lost my faith in the dollar.
I Have Faith In Bitcoin
Bitcoin is just an algorithm. It’s just science. And I believe in science.
And Bitcoin has worked, for 11 years. And during those 11 years, Bitcoin has become, by a VERY wide margin, the most successful entity started in the last 11 years. At $130 billion, its 3X more valuable than Uber.
And it has that value, for the same reason everything else has value, faith. Faith, that over time, more people will have belief in Bitcoin, because it works, and every day, more people will lose faith in the alternatives. And people need to believe in something.
Gold is an alternative, but even gold is largely centralized, which is leading to massive issues.
So I’ve chosen to have faith in Bitcoin. In an algorithm. And like everything else, the only thing needed to make the price of Bitcoin go higher is for more people to have faith in Bitcoin. It feels inevitable. It’s just science. Like gravity.
That why I choose to have faith in Bitcoin.
