High Inflation is a Gift to Crypto
The writing is on the proverbial wall with central banks late to the party to tame the inflationary beasts.
We are receiving a torrent of data points from around the world that is indicative of the financial situation in so many countries now.
Central Banks are hellbent on slow-playing this rate rise thing simply because they don’t want to be the ones responsible for crashing the system.
It’s just easier to go lower for longer than try to raise rates too fast.
Bitcoin’s (BTC) appreciation is directly correlated with a rise in the pace of hyperinflation.
Just look at Canada today — it released some bowel-disturbing inflation data.
Consumer prices in Canada rose at their fastest rate in 18 years in September, as the country continued to get smacked around with global supply chain issues.
The annual inflation rate hit 4.4%, up from 4.1% in August, its highest level since February 2003.
The costs of transport, housing, and food all jumped, the country's official statistics agency said.
Canada's central bank, which meets next week to decide whether to raise interest rates, is watching the chaos in real-time.
Inflation will get worse before it gets betters and that’s what this 4th wave of the pandemic hitting the European continent tells us.
Don’t think that supply chains are going back to smooth management anytime soon.
A combination of surging consumer demand, global supply chain issues, product shortages, and rising oil prices are driving up the cost of living from pandemic-era lows.
It was only a few weeks ago when The British army began delivering gas to British gas stations on Monday after 100,000 Polish truck drivers decided it wasn’t worth the money to go through a bevy of draconian restrictions from PCR testing, harsh visa rules, and the uncertainty of even spending nights in their truck.
They decided to go back to their families in Poland and Europe is going through a worker shortage similar to the US.
Almost 200 military tanker personnel, 100 of which were drivers, were deployed to provide temporary support as part of the government's wider action to further relieve pressure on gas stations.
If gas deliveries fail to make it to the gas station, might as well sit home and use that fat finger to buy up some crypto.
Of course, this kind of inflation is a tax on the consumer, on the public, on businesses. And it's a regressive tax that will over time undermine the purchasing power of salaries.
If one were happy over an $8,000 per year raise, most everyday Joe would be, that money is pretty much going back to the servicers one already pays because prices are higher for the same services.
Not much bang for the buck which is why readers are connecting the dots to splurge in crypto investing.
Billionaires are starting to come out of the woodwork to tell everybody that they “underinvested” in crypto.
Hindsight is 20 — 20.
If this winter delivers nasty weather, then expect logistics to slow to a crawl.
In the U.S., meat was one of the food items most affected by inflation, becoming more than 10% more expensive over the course of a year.
Eggs’ price increase even exceeded 12%, while fruits and vegetables rose by 3%, fats by 7%, and eating out by almost 20%.
And these prices could look cheap by January if we get a perfect storm of pandemic-related logistic problems, driver shortages, more countries executing a hard lockdown like Latvia just did, panic buying, and historically bad global governance.
Can the global governance these days get worse?
Effectively, the rise in crypto prices is symptomatic of lost ironclad faith in certain bedrock institutions that have seen better times.
It’s hard not seeing bitcoin going ballistic into year-end and $100,000 in 2022.
