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Hi everyone, a week has gone by so fast and we meet again at this week’s crypto story. Over the last few weeks, I’ve been sharing with you guys how the success of the Bitcoin network is inevitable.
But going deeper to answer the question of why this is inevitable is difficult to say in one article. If you still have questions about this difficulty, please refer to my previous article: The Brain of a Crypto Analyst
You see, it is not easy to understand something new especially when it is related to macroeconomics but it is not necessary for us to understand everything related around it to believe, buy and hold. hold Bitcoins.
I have also shared with everyone the main point that I hold Bitcoin in previous articles, it is simple and not too difficult to understand and simplicity is sometimes much more advantageous when you believe in something. .
In this week, the point of view that I want to share with everyone is the issue that has been mentioned a lot in the past few months “inflation” or in more detail it is the risk of the shutdown. inflation stagnation.
Just last month, there were more than 4,000 stories on Bloomberg Terminal about stagnant inflation. It is a growing economic concern in the market and it is closely watched by many economists. Stagnant inflation refers to an economic time when inflation rises, economic output stagnates, and unemployment is high.
Historically, stagnant inflation has often accompanied oil shocks. Currently, we are seeing Crude Oil Price Average Per barrel hitting a 7-year high, with a global oil supply/demand imbalance. Together with natural gas and coal shortages in Europe and Asia, these factors are increasing the market’s likelihood of a stalled inflation scenario.
We can see this trend playing out as China’s Producer Price Index (PPI) increased by 9.5% in August while China’s Consumer Price Index (CPI) was 0.8%. shows weak buying demand of Chinese consumers. For the United States, this comes at the same time that monetary policy is poised to tighten.
With total domestic debt to GDP of the United States at 389.2%, nominal interest rates cannot rise without crashing the economic system, which puts Jerome Powell and the Federal Reserve in a predicament. difficult position.
This is quite paradoxical, because the current environment does not end well for many participants. The current path of nominal interest rates is kept to the lower bounds of zero while real rates continue to decline sharply with higher inflation indicators encouraging borrowing at lower and lower real yields. to take advantage of and overcome the ongoing monetary inflation.
There are many questions to be answered, and the answers to these questions are quite complex (for many people), but also quite simple (if we understand what can protect us). The game will come to an end if the credit quality of all balance sheets across the global economic system deteriorates. After all, in a 100% fiat debt-based monetary system, money is created through lending and destroyed through repayment and default. As the entire global economy becomes systematically overleveraged as it is today, there is a risk that the credit quality of fiat will be reduced as an asset.
The risk is high but the reward is very small.
And Bitcoin, is the solution to the problem that people like us are looking for.
A non-sovereign, decentralized global store of value, produced through proof of work with limited supply and adjusted in difficulty to limit production to a set algorithm prior to. It may be the least risky of all the assets you know, and in a world of increasing economic uncertainty, bitcoin will be your best bet.
Next Week’s Events
Notable events for everyone next week:
October 12 – October 14: NFTCON is a free 3-day webinar for all things NFT related.
October 13 – October 14: World Blockchain Summit- Dubai is a conference where you will have 2 days of unique networking with over 500 high-level professionals from governments and businesses along with identified investors, blockchain experts and developers.
October 15 – October 17: The Conscious Crypto Event For Traders is a cryptocurrency symposium with top traders, online training and talks on maximizing profits when trading in the cryptocurrency market.
Below are notable news from the projects:
These are the important information in the coming week, hope that the information I provide in this article will help everyone.
Hello everyone and have a great weekend.
By Dung Bui – CHK Team
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