Cryptocurrency

[titanruss]

Continuing this weeks episode of Highly Respected Billionaire Investor who is Smarter Than You Invests in BTC we have... Paul Tudor Jones. Welcome to the fucking show Paul! 

 

https://www.cnbc.com/2021/06/14/tudor-jones-likes-bitcoin-calls-it-a-great-portfolio-diversifier-to-protect-his-wealth-over-time.html

[titanruss]

15 hours ago, Supdawg said:

Probably nothing, right...? 

 

 

Oops didnt see this 

[Supdawg]

Saylor is a fucking chad.  He will be buying more Bitcoin with the proceeds, at least some of it. 

 

 

 

 

 

Edited June 15, 2021 by Supdawg

[Jamalisms]

7 hours ago, titanruss said:

Yeah... derp is right

 

36k to 39k after Elon tweet

39k to 42.5k post Elon tweet

 

Classic

[titanruss]

14 minutes ago, Jamalisms said:

 

Classic

Hey turd muffin...

 

even if you want to act like tweets influence forever... because you dat stupid....

the rise up before the tweet was bigger

 

idiot. 

[titanruss]

Goddamn @Jamalisms please come here and embarrass yourself more. 
 

[Jamalisms]

Little finger and Varys are obviously the Bitcoin Lords.

 

Dany and her dragons are the ransomware demanding payout in Bitcoin.

 

The Lannisters are Elon Musk.

 

The Starks are the US government.

 

Have you fucks even watched that god damn show?

[titanruss]

The starks are the US govt? 
 

in what way? Because you think they come out on top in the end? 
 

 

[pat]

the markets can remain irrational longer than you can remain solvent

[Supdawg]

Few...

 

 

[pat]

You can't think about the Feds balance sheet in the same terms as a household credit card.

 

And there's something more fundamental going on here, a philosophical question, even, that we might do well to contemplate.  What is the difference between a gangster pulling out a gun and demanding you give him a thousand dollars of "protection money," and that same gangster pulling out a gun and demanding you provide him with a thousand-dollar "loan"?   In most ways, obviously, nothing.  But in
certain ways there is a difference.  As in the case of the U.S. debt to Korea or Japan, were the balance of power at any point to shift, were America to lose its military supremacy, were the gangster to lose his henchmen, that "loan" might start being treated very differently.  It might become a genuine liability.  But the crucial element would still seem to be the gun.

 

Debt: The First 5000 Years (pdf)

[9 Nines]

2 hours ago, Supdawg said:

Few...

 

 

@OILERMAN @Jamalisms

We just crossed the shirtless picture to prove one is not fat.

In a failed attempt to show that they know more than their critics, the above tweet demonstrates that the person making the tweet, and people parroting the tweet do not even know basic things. 

To @Supdawg, no a 1%, and it would be a 100 basis point increase anyway not a 1% multiple as stated,  would not cause the interest payments to go up by that amount, for a host of reasons.

First,

I assume by funds rate, the tweeter means federal funds rate.  Federal funds rates are targeted through market mechanisms, as opposed to federal discount rates which are set, for overnight borrowing of banks reserves.  They do not affect interest paid on other, third party instruments. 

Also, something interesting about this.  From my understanding the entire banking systems ties overnight every night.  During the day, banks make loans, which drain their reserves but it is not as simple as that.  When a bank makes a loan it actually creates a degree of reserves because a bank lending money creates money which creates reserves.  That money is either deposited at that bank or another bank in the system - so at end of the day the entire banking system ties it newly created loans.  As I understand no bank officially checks its reserves as it makes loans.  Therefore, at the end of the day, some banks will be short reserves and others will be long reserves.  Some banks will actively cover or loan their positions through market activity paying and receiving market rates, which federal funds rates are steering. Others will just let it happen automatically at the federal discount rate. 

Second, 

Even ignoring the first, what that person wrote is still not right.   Market rates do not determine interest payments - they are market rates not the nominal rates on credit instruments.  Interest payments are nominal rates set contractually in the instruments.  Those same nominal rates are paid no matter what current market rates are.  If market rates go up, then the trading value of those instruments would be bid down to make their set nominal payments equal a larger percentage on the lower market value of those instruments, but again, would not change the actual amount of those payments as this person claimed. 

Third,

Even if you ignore one and two, you cannot conclude that the interest payments made by the US Treasury would increase the Treasury's actual payments.   This is because by law the Federal Reserve diverts its net operating income back to the Treasury.  This would include interest payments made by the Treasury on bonds held by the Federal Reserve. 

In its market operations, the Fed buys and sells bonds in the open market basically to target interest rates, along the whole curve, to where it wants them to be.  In that activity, and especially in current times, the Fed is the largest  holder of US bonds.   When the Treasury makes interest payments on those bonds held by the Fed, the Fed collects those payments, then those payments flow back to the Treasury at some point since the Fed's net-income goes back to the Treasury.  So again, rising rates, even nominal if that were the case but it is not, would not increase Treasury payments by anywhere close to what that person equates because the Fed held bonds are technically as if those bonds did not exist. 

The above are pretty basic aspects of finance and financial markets, so what this does demonstrate is that these people clearly do not understand even basic things, yet they think they do and apparently are acting, in financial matters, on that misunderstanding  - a potentially dangerous situation for them:
 

 

Edited June 16, 2021 by 9 Nines

[Jamalisms]

I love that movie

 

[9 Nines]

2 hours ago, pat said:

You can't think about the Feds balance sheet in the same terms as a household credit card.

 

And there's something more fundamental going on here, a philosophical question, even, that we might do well to contemplate.  What is the difference between a gangster pulling out a gun and demanding you give him a thousand dollars of "protection money," and that same gangster pulling out a gun and demanding you provide him with a thousand-dollar "loan"?   In most ways, obviously, nothing.  But in
certain ways there is a difference.  As in the case of the U.S. debt to Korea or Japan, were the balance of power at any point to shift, were America to lose its military supremacy, were the gangster to lose his henchmen, that "loan" might start being treated very differently.  It might become a genuine liability.  But the crucial element would still seem to be the gun.

 

Debt: The First 5000 Years (pdf)

 

Sorry if seems nitpicking but positions, such as you quoted, have it completely backwards.  The US is not borrowing anything from those countries, and do not need them, when those countries buy bonds. 

Almost all that bond activity, and the bond holding positions of those countries, is a entirely a consequence of global trade policies.  Most to all those bond holding countries are net exporting countries.  Being net exporting countries they collect net foreign currency because they are buying less goods than they are selling, an the basic math of the situation means that acquire more net currency than they spend.      

That consistent situation causes them to build inventory in those net foreign currencies.   If they were net importers, as the US  and other leading, developed countries are, they would not have those net foreign currencies.   It is their choice.  In fact, they insist, as by design, they want to be net exporters - it is the type of economy they want by their own choice. 

Some in the US actually want it to be different but those countries do not.  As anyone paying attention to news knows, the US wants to install a new manufacturer base, increasing its exports, but it is a two way street, those countries would have to increase their imports to make that happen.

Now, in the current situation, those countries have a claim with those net US dollars  alone, with or without converting them to bonds.   When they buy bonds it does not really change anything at all, the net money they hold is just in a different form.   Think of it is like a checking account, straight currency in this analogy, converted to a savings account, bonds in this analogy.  When you or I do that, transfer from checking to savings, did anything really change?   No.  Same with net importing countries buying bonds with the net dollars that they are freely choosing to hoard.  

So assuming one is a proponent of the US increasing its exporting/manufacturing base, we would want them to quit buying bonds, because that likely means they are not hoarding US currency, which means they are buying more US goods and services.   So if you are a proponent of the US increasing its manufacturing base, those countries are easily the gantsas  - not the US.  In other words, that opinion is backasswards. 

Although in truth the US, if the imbalance ever became a problem and those countries complete flip-flopped wanting to buy more US goods than the US wanted to export.  The US could just tax those dollars in form of taxes on the flow of goods or purchases in US dollars.   So while ganstas in this analogy, those countries are punk ganstas that the US could kick slam into the curb at any time.   So instead of worry about it, sit back and enjoy the goods and services those countries are net exporting to us/US, by their own choice - they are basically neo-colonies for us. 

Edited June 16, 2021 by 9 Nines

[pat]

5 minutes ago, 9 Nines said:

 

Sorry if seems nitpicking but positions, such as you quoted, have it completely backwards.  The US is not borrowing anything from those countries, and do not need them, when those countries buy bonds. 

Almost all that bond activity, and the bond holding positions of those countries, is a consequence of global trade policies.  Most too all those bond holders are net exporting countries.  Being net exporting countries they collect net foreign currency.  They sell more goods than they buy from trading partners.  That causes them to build inventory in those net foreign currencies.   If they were net importers, as the US  and other leading, developed countries are, they would not have those net foreign currencies.   It is their choice.  In fact, they insist, as by design they currently want to be net exporters - it is the type of economy they want by their own choice.  As anyone paying attention to news, the US wants to install a new manufacturer base, increasing its exports, but it is a two way street, those countries would have to increase their imports to make that happen.

Now, in the current situation, those countries have a claim with those net US dollars  alone, with or without converting them to bonds.   When they buy bonds it does not really change anything at all, the net money they hold is just in a different form.   Think of it is like a checking account, straight currency in this analogy, converted to a savings account, bonds in this analogy.  When you or I do that, transfer from checking to savings, did anything really change?   No.  Same with net importing countries buying bonds with the net dollars that they are freely choosing to hoard.  

So assuming one is a proponent of the US increasing its exporting/manufacturing base, we would want them to quit buying bonds, because that likely means they are not hoarding US currency, which means they are buying more US goods and services.   So if you are a proponent of the US increasing its manufacturing base, those countries are easily the gantsas  - not the US.  In other words, that opinion is backasswards. 

Bonds are debt.  The US borrows money from bond purchasers and pays them interest.

The rest of this rant doesn't make any sense.  Guatamala is not a military threat to the United States no matter how many blankets they export.