Financial, Economic and Social Mood Update (October 1, 2021)
It is so sad to see happen and to have to say, but the USA today is collapsing much like the former USSR did in 1991. We could be about one month away from a default on the US national debt, which will likely translate into a massive deflationary collapse following the current bout with hyperinflation. The last time something like this happened in world history was between 1923 and 1949. In 1923, a number of countries in Central Europe experienced hyperinflation due to the burdens placed upon them by the Treaty of Versailles (1919). These countries included Germany, Austria, the Free City of Danzig and Poland. Hyperinflation especially devastated the middle class. These countries did try to recover after 1923, but the deflationary collapse of 1929 (the stock market crash) totally destroyed whatever progress they had made over the 6 year period from 1923 to 1929. The deflationary collapse of 1929 was a worldwide phenomenon which was not even totally “cured” by the massive global deficit spending due to World War Two (1939 to 1945). In the USA, stock prices, rents and real estate prices did not recover their 1929 nominal values until 1949 – 20 years after the fact.
The emerging demographic collapse (which will eventually translate into a massive deflationary economic and financial collapse) evident in the USA is by no means confined to America – it is entirely global in its scope. A recent poll of 45,000 major global employers found that 69 percent of them now have severe problems in filling positions (jobs). Things are so bad that they are willing to hire inexperienced people and train them, which is very costly and time-consuming. The situation will not get better – it will only get worse as we move forward in time over the coming years.
The cryptocurrency market currently stands at 16 percent below its record market capitalization in April 2021. The top 11 investor groups own 87 percent of this market value. 2 of these 11 “groups” are national governments, 4 of them are investment funds or corporations, and the remaining 5 are individuals, groups of individuals or families. The market has already matured to a substantial degree. Assuming that cryptocurrency totally displaces all fiat currency, and that all assets worldwide will be represented solely in terms of cryptocurrency, the entire cryptocurrency market today will increase in value by 1,431 fold. This is a very large increase, but it is much less compared to what it used to be. That said, there is no other type of investment which will likely increase in value by 1,431 fold. And this calculation assumes that all existing 12,600 plus electronic digital currencies will survive – which is unlikely. Thus, the surviving currencies will do even better. The blue chip currencies such as Bitcoin BTC and Ethereum ETH are here to stay, but many of the newer and smaller currencies (smaller in terms of market capitalization) will likely not survive. Cryptocurrencies are already in the process of replacing both commercial banks & investment banks, of which they already comprise more than 60 percent of legally chartered banks.
