Dear Reader

Welcome to your Bitcoin and Global Finance Newsletter for week ending 6th May 2022!

It doesn’t matter what major developments or fantastic new breakthroughs towards Bitcoin adoption are happening in the world, all everyone is talking about today is “what happened to the markets?”

Well, it’s a fair question.

As soon as the red candles started piling up, I was contacted by a number of journalists looking for comments, and, frankly, apart from a few theories that I was quickly exploring, I really didn’t have answers at that point, other than saying it looked like a “textbook capitulation event“.

Some will disagree with that statement, arguing volumes and depth were not sufficient to call it that, but clearly something was going on here. One observation, made by Jason Goepfert at Sundial Capital Research, noted that both the S&P 500 futures were down three per cent and the 10 year futures were down one per cent – a combination so rare that it has only happened on two days before now.

Those dates, incidentally, were October 9 2008 – the day the effects of the ‘Credit Crunch’ became apparent, and March 18 2020 – the day of the initial Covid-19 sell off. Could it simply be a case of market contagion pulling down tech and Bitcoin at the same time?

The thing with markets is that you quite often don’t know why things happen the way they do until later on. Sometimes you never really know for sure. All we do know is that it looks pretty grim out there for now, but, frankly, so does the rest of the macro landscape.

Russia continues to be hell bent on ostracizing itself from everyone else on the planet while trying to do as much damage as possible to everyone else economically and militarily for reasons that are probably only clear to Putin. The whole thing will almost certainly go down in history as a fantastic error of judgement and the Ukrainians are being forced to pay the highest possible price for that mistake.

But in the end, it will ultimately cost all of us dearly as well. According to this simulation carried out by the National Institute of Economic and Social Research, the global economy is set to lose over a trillion dollars of GDP in the next year or so as a result of the war, while adding severe inflationary pressure at the same time. If that’s not depressing enough, this report was from March 7 and all the scenario parameters have already been exceeded. In other words, it’s going to get very, very messy.

Inflation is now eroding our money’s value at the fastest collective rate since our current monetary system began in 1971 and central banks, like the Bank of England and the Fed, are raising rates to try and contain it, just as they did this week. It won’t be enough.

So what’s the bottom line? Being financially aware is now probably more important than it has ever been before. Yes, we’re all affected by macro events that don’t look good, but ultimately our financial future is always in our own hands, even if we don’t always remember that.

And with that slightly more uplifting thought, I hope you have a fabulous weekend!

Jason

PS Thanks to all who requested more information on the Texas mining opportunity I am putting together with some (well known!) colleagues at the moment that I mentioned last week. Just a reminder that the deadline for the double equity offer expires tomorrow so if there are any more last minute questions I can help me, now's the time to hit me up!

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Want to learn more about what’s going on in our global financial system and how Bitcoin fits into it? Come to my next free webinar on Tuesday May 24 at 6pm to find out, ask any questions, and grab some free Bitcoin*. Click here to register.

*18+, UK resident, new to Luno only