Sound Money Dave

Bitcoiner | Sound Money | Gold | Austrian Economics | #Bitcoin Bull | Macro | Quality. So bearish, I’m bullish. Lift weights, own sound money. Steady lads.

[WOLF Terminal @WOLF_Terminal]

🚨 @LynAldenContact ON WHY NOTHING STOPS THE DEBT SPIRAL:

"Congress going to say, 'The 10-year is over 5%, maybe we should trim defense spending or reform Social Security and Medicare?' It's not gonna happen. There's no political will to do that. Less than 1% chance. Negligible."

On how it plays out instead:

"If the Treasury market ever breaks, instead of Congress doing anything, the Fed steps in. They kind of have to because financial stability and moderate long-term yields are part of their mandate. Congress isn't doing it because the people don't really want it. They want a balanced budget in theory. But do you want to cut this, this, and this, or raise your taxes? 'Well, no.'"

On the historical endpoint:

"The end game for highly indebted governments, nearly 100% of the time, ends with financial repression, trying to inflate that debt away, and impairing cash and bondholders. Whether it's the central bank doing it, whether it's the Treasury doing it, whether they take turns, these are the types of things you see when you start getting over 100% debt to GDP and no realistic austerity anywhere near the horizon."

[Sound Money Dave @SoundMoneyDave]

@TXMCtrades Litterally anything with demand + scarcity.

[Sound Money Dave @SoundMoneyDave]

@TXMCtrades On related note, little did 7 year old me know my Pokémon card collection would be my best store of value.

[𝐓𝐗𝐌𝐂 @TXMCtrades]

The Treasury Secretary had a revealed preference moment this week and showed he will defend the bond market at the expense of the currency. His department is literally buying duration from the market and financing it with cash-like bills while calling it "liquidity management". The market responded as if it were saying there's no way sacrificing the currency can pull more physical resources out of the ground faster. The state department is engaged in a loser of a war at the location of nearly a quarter of global energy production and throughput and have zero elegant ways to get out. The Treasury has been issuing 60% bills (in ever growing amounts) for two years and keeping long end issuance flat like the biggest economy on Earth is a banana republic. The Fed has talked tough on inflation that has been above target for 65 months and the new chair holds disaster press conferences where he cannot articulate a single substantive view for the path of policy despite clearly loose financial conditions. Demographics of every major economy are flat or negative and they're sitting on over a hundreds trillions worth of unfunded promises in the form of pensions/entitlements, combined. The AI buildout continuing is now a matter of national security. The state is funneling tens of billions of dollars of off-budget credit into strategic industries via the export-import bank and buying stakes in dozens of companies via the Commerce Dept. We now have brokerage accounts for infants. The president's family owns a business that now has a banking license and issues its own stablecoin. The state is declaring it wants US to be the crypto capital of the world. The Treasury is working to tokenize the financial system and then pump trillions of dollars of stablecoins into under-served markets around the the global economy to sustain dollar dominance, expanding access to U.S. assets and creating a potentially large volume of new demand for more short term govt paper. National debt is $40T. The current President has added more to the debt total in his full time in office than any president in history. Various major governments are openly weighing paths to capital repatriation and financial repression in full view of the public eye. Debt to GDP is at WW2 levels and there is no planet in god's creation where they can reverse it without heinous capital controls and a couple decades of rampant debasement.

All of this is happening right now... today...

and you're bearish Bitcoin of all things?

Brother in Christ.

[Luke Gromen @LukeGromen]

This could prove 100% accurate if he swaps ALL the Federal debt for T-Bills, then uses those T-Bills to back 0% yielding stablecoins, then cuts the rate on those T-Bills to 0.60% (b/c the banks don't deserve 3.5% on stablecoins).

You're gonna want to own more gold & BTC though.

[Sound Money Dave @SoundMoneyDave]

Let me be clear. $MSTR is by no means a ponzi, it’s transparent. However it’s hard not to see the potential reverse flywheel effect here, something that has long concerned me. Oh and not to mention the terrible deployment of capital and “never sell your Bitcoin tweets”

[Michael Saylor @saylor]

Strategy has established a $BTC Monetization Program under which we may sell BTC to fund our:
- USD Reserve ($1.25B cap)
- dividends and interest expense
- repurchases of our Digital Credit securities and $MSTR under our repurchase programs

[Sound Money Dave @SoundMoneyDave]

@TXMCtrades If the denominator is worthless then that begs the question, what is the correct denominator?

[Sound Money Dave @SoundMoneyDave]

@TXMCtrades If the denominator is worthless then that begs the question, what is the correct denominator?

[Sound Money Dave @SoundMoneyDave]

@ExitLiqCapital Props, you’ve been nailing these markets. Find myself looking to you more and more to confirm what I’m seeing. No need to trade a million things if you can trade one thing and trade it well.

[Sound Money Dave @SoundMoneyDave]

@TMathSports Can’t help but feel this is a pure top signal.

[Sound Money Dave @SoundMoneyDave]

@TXMCtrades I remember people clowning this dude for calling for S&P to go to 6,000+ in 2022…. Who is laughing now.

[Sound Money Dave @SoundMoneyDave]

Fucking legend @federalreserve

[Lyn Alden @LynAldenContact]

Well, with over five continuous years of above-target inflation from spring 2021 to the present, at least we fixed the "low inflation" problem. 💀

[Sound Money Dave @SoundMoneyDave]

While what Ray says is true, it evokes some questions.

Is gold a safe heaven asset if it too got sold in a crisis?

What is a safe heaven asset, if everything besides dollars gets sold in a crisis?

Is Gold or BTC ultimately the harder money?

[Ray Dalio @RayDalio]

While Bitcoin gets a lot of attention, it hasn’t played the safe-haven role many expected. In my view, there are a few reasons why.

First, Bitcoin lacks privacy. Transactions can be monitored and potentially controlled, which is why central banks aren’t looking to hold it.

Second, it also has a high correlation with tech stocks. When investors get squeezed in other areas of their portfolio, they sell their Bitcoin to cover it.

Third, it’s a relatively small and controllable market, whereas gold stands alone. There is only one gold.

Ultimately, gold is more widely held, deeply established, and still plays a central role in the global system.

[Sound Money Dave @SoundMoneyDave]

@Cointelegraph @LynAldenContact paid newsletter sub here. Any chance you can talk thru this in an upcoming letter?

[Sound Money Dave @SoundMoneyDave]

@bitcoinjack 👇 https://t.co/BWhjzFiIt6

[Sound Money Dave @SoundMoneyDave]

Possible mechanism of flows. Market sells off due to risk off, people go to cash and instead of T Bills or MMF park some in STRC as a cash equivalent yielding 10%. This creates reflexivity and creates a marginal bid for BTC during risk off. Something to watch.

[Sound Money Dave @SoundMoneyDave]

@BitcoinMagazine @LukeGromen 👀

[Sound Money Dave @SoundMoneyDave]

The lack of critical thinking, second, and third order derivatives that weren’t considered here and haven’t been considered for the past 25 years by our leaders is astounding 👇

[Shanaka Anslem Perera ⚡ @shanaka86]

BREAKING: An Iranian ballistic missile guided by Chinese BeiDou satellites, fuelled by Chinese sodium perchlorate, precisely navigated by Chinese gyroscopic sensors, and fabricated on production lines equipped with Chinese SMIC tools just struck the Neot Hovav industrial zone south of Beersheba. Israel’s largest chemical and hazardous waste complex. Nineteen plants. Adama. Teva Pharmaceutical. Israel Chemicals. A warehouse is burning. Route 40 closed. No injuries. No hazmat release. Fire contained.

Four countries built that missile. One country appears at every layer of the supply chain. The same country that processes 85 to 90 percent of the rare earth magnets inside the Arrow interceptor that was fired to stop it.

The missile cost Iran between $200,000 and $500,000. The Arrow 3 interceptor that attempted to stop it cost $2 to $4 million. If THAAD was fired, $13 to $15 million. If a Gulf state Patriot battery engaged a Shahed in the same wave, $4 million to stop a $20,000 drone. The cost ratio runs 5 to 1 at the lowest. 200 to 1 at the highest. The defender pays more to stop the weapon than the attacker pays to build it. Every single time.

BeiDou is the variable that makes this ratio lethal. Before Chinese satellite integration, Iranian ballistic missiles relied on pure inertial navigation with a circular error probable of 500 to 1,000 metres. With BeiDou-3 hybrid guidance, the CEP drops to 50 to 200 metres. The missile that hit Neot Hovav did not land in the desert. It landed in a 19-plant chemical complex. BeiDou did not make the missile more expensive. It made the same cheap missile accurate enough to force the defender to fire the expensive interceptor every time. The cost of the offence stayed flat. The cost of the defence compounded.

The Pentagon burned $5.6 billion in munitions in 48 hours. Israel has fired hundreds of Arrows since February 28, exceeding $1 billion in interception costs. The US requests $200 billion in supplemental funding. Iran’s total offensive expenditure: an estimated $200 million. $200 billion to stop $200 million. A 1,000 to 1 ratio at the strategic level.

China is on both sides of the ledger. Chinese BeiDou makes the Iranian missile accurate enough to force interception. Chinese rare earth magnets make the interceptor that fires to stop it. Chinese SMIC tools build the production lines that fabricate the guidance chips. Chinese sodium perchlorate fuels the propellant. Every missile that forces an interception depletes an Arrow that contains Chinese rare earth magnets that are under export restrictions that China controls. The attacker’s supply chain and the defender’s supply chain route through the same country. The country profits from both the missile and the interceptor. The country that makes the offence possible also makes the defence expensive.

This is not a war between Iran and Israel. This is a cost function. The cost function has one variable on the offence side: China. And one variable on the defence side: also China. The rare earth magnets in the Arrow motor. The BeiDou signal in the Emad guidance. Both made in the same country. Both consumed in the same exchange. One depleting the other. The war is a Chinese supply chain consuming itself at a ratio that bankrupts the defender before it exhausts the attacker.

Neot Hovav is contained. No injuries. No hazmat. And none of that matters. The interceptor was fired. The stockpile shrank. The rare earth magnet was consumed. Tomorrow another BeiDou-guided missile will force another Arrow containing another Chinese magnet to fire at another ratio the defender cannot sustain.

The IDF Chief said “collapse.” The interceptor stockpile says the same in a different currency. Both currencies route through Beijing.

Full analysis: https://t.co/32ixeQpN7N

[Sound Money Dave @SoundMoneyDave]

@_Checkmatey_ FWIW
https://t.co/gCRBUj4By3

[Sound Money Dave @SoundMoneyDave]

@TXMCtrades In a time of war, what do you sell? You sell it all. Gold is a reserve asset.

Maslow’s hierarchy of needs. Food, energy, and personal safety first. Of course you’d sell gold. Gold is not immune and ultimately suffers the same fate as treasuries here. Careful who you listen to.

[Sound Money Dave @SoundMoneyDave]

@TXMCtrades In a time of war, what do you sell? You sell it all. Gold is a reserve asset.

Maslow’s hierarchy of needs. Food, energy, and personal safety first. Of course you’d sell gold. Gold is not immune and ultimately suffers the same fate as treasuries here. Careful who you listen to.

[Sound Money Dave @SoundMoneyDave]

@TXMCtrades I’d expect better from you, chill.

https://t.co/73QIrvdnOA

[Nik Bhatia @timevalueofbtc]

For idiots calling for Treasury market collapse, have fun celebrating the fact Treasury yields are all the way up to....

....equilibrium levels for the past three years.

Choose your idiots wisely!