Bitcoin’s Future

The wind roared through Puget Sound. An angry wind hellbent on destruction.

And Galloping Gertie was in the way…

As the wind approached the city of Tacoma, Washington, the devilish torrent ripped through the Narrows separating the city from the Kitsap Peninsula on the other side of the water.

The only obstacle in the way: A suspension bridge that had opened to traffic less than five months earlier—the Tacoma Narrows Bridge, known colloquially as Galloping Gertie because of the roadway’s tendency to rise and fall with such vigor that drivers often lost sight of the car in front of them.

The bridge had a natural resonance to it—a natural vibration.

But along came the wind to match that vibration… and all hell broke loose.

Soon, the structure was under the influence of something known as “sympathetic vibration”—a physical phenomenon in which a vibration in one body exactly matches a vibration in a second body.

In this case, wind and steel in unison.

The suspended roadway was swaying and shimmying like a 1960s go-go dancer…

And then it simply plunged into the Narrows.

If you’ve not seen the November 7, 1940, video of the Tacoma Narrows Bridge collapse, hit up Google. It’s fascinating to watch.

Now, to be sure, this is an odd intro into today’s dispatch… which is actually about the dollar and bitcoin.

And no—they do not share sympathetic vibrations.

More like unsympathetic vibrations.

Whatever rate at which the dollar is vibrating up or down in any given moment, bitcoin is most likely moving opposite of that.

Which is really the most important fact in today’s dispatch… but more on that later.

The sympathetic vibration I’m worried about is America’s debt and its political class.

There is an unnatural symbiosis there that is increasingly troubling.

See, government, as you and I well know, is supposed to be a wise steward of the nation’s treasury. It’s supposed to tax and spend within reason. It’s supposed to manage a budget with prudence, and frugality when necessary.

Through America’s early years—well into the 20th century—that was pretty much standard operating procedure in DC.

Sure, there were moments when Uncle Sam spent a bit too drunkenly, but often that was tied to pulling the country out of a crisis, such as the Great Depression, or waging wars to preserve freedom and democracy (World War II).

By and large, politicians managed Sammy’s wallet generally well, as measured by America’s debt-to-GDP.

Outside of one-off events, that number was always fairly low and typically well below 100%.

Today, we have politicians on both sides of the aisle with the financial sense of an unfrosted Pop-Tart, i.e.—useless.

Some give lip-service to America’s ever-rising and increasingly troubling $35 trillion in debt, but lip-service doesn’t pay the bills and it doesn’t change the trajectory of America’s debt.

Thus, the sympathetic vibration I fear is already rumbling through the dollar.

Whichever party was in power, congresses and presidential administrations in the last 25 years have largely been in sync. Though the spending they’ve pursued has been tied to different pet projects, the end result is the same desire to spend, spend, spend to buy votes, regardless of party affiliation.

And, so, rising debt and rising financial idiocy are vibrating harmoniously…

Meaning the dollar is quite likely going to plunge into the metaphorical Narrows at some point (likely this decade).

Global investors simply will not retain confidence in the dollar as America’s debt problem spirals into a debt crisis.

Which brings us to bitcoin…

The fact is that the granddaddy of crypto generally moves opposite of the dollar

This chart shows what I’m talking about…