Not a Bitcoin Pain Point! Dollar Sags on President Trump’s Chide of the Fed
For now, bitcoin is the David to the U.S. dollar’s Goliath. But with bitcoin, there is no managerial Federal Reserve to be staffed up or elbowed. It’s a dynamic that’s acutely come to the fore today, August 21st, as President Trump’s fresh ribbing of the Fed has caused the dollar to begin sagging.
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Hey! That’s My Money You’re Poking!
On Monday, President Trump explained to Reuters his frustration with Federal Reserve Chairman Jerome Powell’s recent monetary policy decisions. The criticism comes days after the president reportedly complained about the Chairman’s interest rate increases at a private fundraiser.
Now, the dollar has seemingly started to decline over the tension.
Casting Powell as being unhelpful in light of ongoing trade battles wherein other countries’ central banks are working to lessen the pain, Trump argued Powell’s rate boosts were doing the opposite and said he deserved similar “help,” saying he wasn’t “thrilled” with the independent Chairman’s actions:
“We’re negotiating very powerfully and strongly with other nations. We’re going to win, but during this period of time I should be given some help by the Fed. The other countries are accommodated.”
Trump had previously criticized Chairman Powell, though more mutedly, back in July 2018. In his new remarks to Reuters, the U.S. president also notably accused both Europe and China of currency manipulation.
Now, USD investors have accordingly started to get spooked as doubts have gained traction regarding future interest rate increases. At press time, the dollar was down almost 0.4 percent against the euro and was down 0.47 against the pound on the day, for example. That’s to be contrasted with the recent advance of USD, which had hit a three-year low earlier in 2018 only to start looking healthier as of late.
That’s where the notion of bitcoin as an alternative can start to creep in. Bitcoin has its own flaws and kinks to work out. And over time its developers hope to do just that. But even still, it already currently serves in its viable adolescent state as an “opt-out” to managed economies.
Bitcoin is the most powerful non-violent tool the world has ever seen. The ability to opt-out of poorly managed economies is a gamechanger. It gives power and freedom to those who wouldn’t have it otherwise.
That’s the main value prop of bitcoin.
That’s why I’m a bitcoiner.
— Matt Odell (@matt_odell) August 21, 2018
It’s not to say that the dollar is imminently doomed. But it is to say that it’s becoming increasingly feasible to conceive of a world where the dollar’s hegemony dissipates. And researchers are doing just that as we speak.
Bitcoin couldn’t ask for a better opening. And that’s something that comes to the fore on days like today.
I’m still mulling over yesterday’s one-two punch of Venezuela’s devaluation and Iran’s Central Bank switching to yuan from USD on it’s rate reporting platform.
This AM I re-read this paper from June, about future of the international monetary system, with fresh eyes. (Thread) pic.twitter.com/VDv5qHnXkO
— میگم نره٬ میگه بدوش (@arbedout) August 21, 2018
Well, While We’re Talking About Centralized Pain Points …
The global financial crisis of 2008, or the Great Recession, caused many to similarly want to “opt out.”
That reality will hit home again for many in light of newly published emails showing Royal Bank of Scotland executives joking and talking willy-nilly about participating in the crash of the U.S. housing market one decade ago. The ensuing existential fallout was devastating for millions.
So when there’s anti-banking sentiments in the cryptoverse, make no mistake, it’s driven by absurd corruption like this.
“The Times 03/Jan/2009 Chancellor on brink of second bailout for banks,” as Satoshi Nakamoto cited in Bitcoin’s genesis block. Because bitcoin points beyond such bailouts.
Indeed, the last laugh may be on the banks yet.
That’s per Blockchain CEO Peter Smith, who just speculated on CNBC that central banks may start hodling BTC and ETH as soon as this year.
OK, I laughed when I first read this. On the other hand, not sure why Fed still holds gold in its vault.
Central banks could hold bitcoin and ether for the first time in 2018, cryptocurrency CEO says https://t.co/nup60ThLMq
— David Andolfatto (@dandolfa) August 20, 2018
What’s your take? Are you sympathetic to “opting out?” Let us know in the comments below.
Images via Pixabay, Market Insider