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Musings Report #52 12-24-16 Let Us All Be Grateful
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For those who are new to the Musings reports: they are basically a glimpse into my notebook, the unfiltered swamp where I organize future themes, sort through the dozens of stories and links submitted by readers, refine my own research and start connecting dots which appear later in the blog or in my books. As always, I hope the Musings spark new appraisals and insights. Thank you for supporting the site and for inviting me into your circle of correspondents.
Let Us All Be Grateful
I received this email from correspondent Bart D. (Australia), and it struck me as the ideal holiday reminder of our greatest blessing: life.
"Let us all be grateful for simply being in the land of the living. During my recent business travels, I pulled in to the cemetery of the sleepy little coastal town where I spent my early primary school years. The graveyard is a quiet place, miles from town, on a low sandy rise in the middle of an expansive, arid plain. Off in the distance to the west, just visible through the shimmer of heat haze, is the dark line of a mangrove forest. To the east are high, dark mountains. The people who put the first grave there back in the 1880’s certainly had a sense of gravitas. It was my first visit to this place and I’m not sure why, on a whim, I went there to take a look.
There were some sparrows chirping in the trees near the cemetery entrance; the only trees for several miles around. The silvery Saltbush which covers the plain is only halfway to knee high.
At the end of a row of headstones... I found one of my school class mates.
I last saw him in 1981 when we were both nine years old. We were part of a class numbering 13, and he was, I expect, the first of our group to check out of planet earth; age 19. When he was put in the ground in this quiet place … I was meeting my future (current!) wife at university and having a grand time. Oblivious to the severe personal challenges of my future that would test me to the core.
When I think of the opportunity, adversity and experience I’ve had since that age... and which he never got... I’m reminded that the problems of society and economy I sometimes work myself up over … are in fact trivial. The big picture effects billions of lives … but for the individual it is really of little consequence … the most important battles of our lives are small against the backdrop of national events … a cancer diagnosis, a divorce, deaths of close family members, marriages, children being born, children graduating, paying off your first home.
The simple fact of being alive is a wonderful, wonderful thing."
Summary of the Blog This Past Week
Crisis of Meaning = Crisis of Work 12/23/16
Why the Massive Expansion of "Money" Hasn't Trickled Down to "The Rest of Us" 12/22/16
Will Tax Cuts and More Federal Borrowing/Spending Fix What's Broken? 12/21/16
What Have the "Experts" Gotten Right? In the Real Economy, They're 0 for 5 12/20/16
Are You a Deplorable? Take This Quiz to Find Out 12/19/16
Best Thing That Happened To Me This Week
Four inches of rain in 24 hours tested my new drainage system--it worked!
Market Musings: Bitcoin
I've known about bitcoin (BTC) for a number of years, and have referenced it as a non-state controlled currency, but I only began accumulating it earlier this year.
I wrote a summary of why BTC is here to stay and why it matters in June: An Everyman's Guide To Understanding Cryptocurrencies.
Interestingly, but unsurprisingly, new cryptocurrencies such as Ethereum soared on investor enthusiasm and then settled back to Earth as the practical limits outweighed future potential.
Ethereum went from $6 to $14 and has since cycled back to $6.
Bitcoin has doubled from $450 in May to around $900 today, and while it will likely retrace, the probability that BTC could reach crazy valuations in a global currency crisis is high in my view.
How crazy? How does $17,000 per BTC sound? How could BTC rise from $900 to $17,000? All that would be required is for 1/10th of 1% of current global financial assets to move into BTC. That razor-thin slice would push the value of BTC to $17,000.
There can only be 21 million BTC created, and millions of those have been lost to hard-drive crashes, etc. in the early years, when BTC was sub-$1.
This chart of BTC is for the past year so the crazy spike over $1,000 in November 2013 doesn't even appear here. (The proximate cause of the spike was the Cyprus bank bail-in panic.)
BTC has a history of spikes and crashes, and this pattern may well continue. That said, note the uptrend over the past year as the number of transactions has soared. (The spike over $700 was triggered by the "halving" of BTC issued to those hosting the BTC blockchain.)
Unlike other cryptocurrencies, BTC is already in practical use. I have paid overseas translators and editors in BTC, and the transaction fees are very low compared to PayPal or other international payment protocols.
BTC surges when people begin to fear their money will be bailed-in during banking crises or confiscated by the state, or simply voided, as is occurring in India.
Bitcoin is unique in not being controlled by any state. Users and hosts dictate the direction of BTC.
Disclosure: I want to be clear that I own a position in BTC, so I am not a disinterested voice. I think BTC offers unique characteristics along with its high volatility. Its lack of history and high volatility make it unsuitable for many portfolios.
One reason why I am bullish on BTC is the user base is still negligible. None of my friends or family own a single BTC. Do you know anyone personally who owns BTC as an investment or payment tool? Everyone has heard about it but very few own any BTC.
As we all know, the vast majority of financial assets are owned by the super-wealthy, corporations and institutions (insurance companies, pension funds, etc.) If the major players start adding BTC to their portfolios, this could push BTC into a new realm.
On the other hand, maybe BTC will fall 25% or even 50%. Investors have to be aware that volatility in BTC is unlikely to go away. That said, the trendline is what ultimately matters.
From Left Field
The Internet Is Broken. Here’s How I’d Fix It -- by Steve Jobs' biographer....
Jordan Peterson: Existentialism | Authenticity (1:06)(via Ryan R.)
EROEI Calculations for Solar PV Are Misleading--Gail; Tverberg
MOST DANGEROUS COUNTRIES IN THE WORLD 2016 (via John F.
Twelve Organizations Promoting Urban Agriculture around the World (via Chad D.)
The Global Future of Work: Lowsumerism, slow life and slow food are a few excerpts of actions being taken as we speak
China is Confident: How Realistic? Wallerstein always worth reading--
From Conquest To Affluence To Collapse | The 250 Year Empire Life Cycle (via Chad D.)
China's True FX Outflows Since August 2015 Are $1.1 Trillion, Double The Official Number
Chinese Rush to Open US Dollar Forex Accounts: More Capital Controls Coming
Smog chokes China cities, grounding flights, closing roads
Tiny Houses Join the Building Code
WORKERS OF THE WORLD, FIGHT AMONGST YOURSELVES! NOTES ON THE REFUGEE CRISIS
"To change something, build a new model that makes the existing model obsolete." R. Buckminster Fuller
Thanks for reading--
charles |
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