Simone Wapler – La Chronique Agora (France) –
Janet Yellen, president of the Federal Reserve, presumed mistress of the dollar’s destiny and the biggest financial bubble of all time, spoke yesterday.
About bitcoin, she said “not even afraid at first” or something like that but more convoluted.
” I would just like to say that bitcoin plays for the moment a minor role in the payment system. It’s not a stable source of safe haven and it’s not an official currency . “
Just imagine, Janet may be right. My colleague Gérard Dréan, in his column of the day, explains why it is unlikely that a single cryptocurrency will ever have a dominant use:
” All the systems that will be successful as a general payment system will sooner or later reach their limits and will encounter conflicts over how to cross them, where they will split and coexist. “
Janet Yellen also admitted that she did not understand anything about inflation:
” The understanding of the FOMC (Federal Open Market Committee) inflation factors is imperfect *”
In fact, the Fed has cheated so much on its inflation indices for almost four decades that the statistics mean nothing. Among the manipulations: the withdrawal of real estate price indices to replace them with “equivalent owner rent”; the search for a balance between inflationary and deflationary forces, leading to an overweight in electronics and technology spending, whose prices are falling in the face of higher energy and food costs; finally in 1999, the idea of ”substitution”: if consumers can no longer afford a steak in the sirloin and buy ground meat, minced meat incorporates the inflation index and the sirloin come out … With all these little arrangements,My eye becomes wet with tenderness. This brave Janet finally confesses that she knows nothing … It is time for her to retire and that a pretentious character replaces her which I can easily mock.
In summary, Janet Yellen is not afraid and the Fed understands nothing. We are well advanced.
It’s better to hang on to what we perceive than to those verbose speeches.
First certainty: the balance sheet of the Fed drops. There is less credit flooding the markets (less than 80 billion dollars in three years). It is certainly small but it is visible and it is mostly a reversal of trend.
Second near-certainty: bond yields start to rise in the United States. It seems that the low point has already been touched as we wrote on December 8th.
Dear reader, the reversal of a trend that has lasted 36 years is not a straw.
We foresee an immense upheaval and the bursting of the biggest bubble of all time: the bond bubble.
And here is another free estimate …
We anticipate that this turnaround will be favorable to “off-system” assets such as gold and possibly cryptocurrencies, but we believe that gold is more robust and universal than cryptocurrencies. [Editor’s note: How to take advantage of this big reversal of the trend and the new rise in gold that has stealthily started at the same time as the downturn in the bond market? Everything is here and do not wait to put your pawns to take full advantage of this new big bull market.]
* FOMC’s understanding of what’s driving inflation is imperfect