{"id":28738,"date":"2017-12-11T12:04:39","date_gmt":"2017-12-11T17:04:39","guid":{"rendered":"http:\/\/olduvai.ca\/?p=28738"},"modified":"2017-12-11T12:04:39","modified_gmt":"2017-12-11T17:04:39","slug":"bitcoin-vs-fiat-currency-which-fails-first","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=28738","title":{"rendered":"Bitcoin vs Fiat Currency: Which Fails First?"},"content":{"rendered":"<h3><a href=\"http:\/\/www.oftwominds.com\/blog.html\">Bitcoin vs Fiat Currency: Which Fails First?<\/a><\/h3>\n<p><i>What if bitcoin is a reflection of trust in the future value of fiat currencies? <\/i><\/p>\n<p><b>I am struck by the mainstream confidence that bitcoin is a fraud\/fad that will soon collapse, while central bank fiat currencies are presumed to be rock-solid and without risk.<\/b> Those with supreme confidence in fiat currencies might want to look at a chart of Venezuela&#8217;s fiat currency, which has declined from 10 to the US dollar in 2012 to 5,000 to the USD earlier this year to a current value in December 2017 of between 90,000 and 100,000 to $1:<\/p>\n<p><img decoding=\"async\" class=\"wide\" src=\"http:\/\/www.oftwominds.com\/photos2017\/bolivar12-17.png\" width=\"550\" align=\"center\" border=\"0\" \/><\/p>\n<p><a href=\"https:\/\/www.focus-economics.com\/country-indicator\/venezuela\/exchange-rate\" target=\"resource\">Exchange Rate in Venezuela<\/a>:<i><\/i><\/p>\n<p><i>On 1 December, the bolivar traded in the parallel market at 103,024 VED per USD, a stunning 59.9% depreciation from the same day last month. <\/i><\/p>\n<p><i>Analysts participating in the LatinFocus Consensus Forecast expect the parallel dollar to remain under severe pressure next year. They project a non-official exchange rate of 2,069,486 VEF per USD by the end of 2018. In 2019, the panel sees the non-official exchange rate trading at 2,725,000 VEF per USD.<\/i><\/p>\n<p><b>If this is your idea of rock solid, I&#8217;ll take my chances with bitcoin, which currently buys more than 1 billion bolivars.<\/b> Of course &#8220;it can&#8217;t happen here,&#8221; which is precisely what the good people of Venezuela thought a decade ago.<\/p>\n<p><b>Gordon Long and I discuss <a href=\"https:\/\/youtu.be\/JIYPfKbrfzU\" target=\"resource\">Fiat Currency Failure<\/a> (The Results of Financialization &#8211; Part IV) in a new 31-minute video.<\/b> The bottom line is that fiat currencies are debt-based claims on future profits, energy production and wages, claims that are expanding far faster than the real economy and the productivity of the real economy.<\/p>\n<p>In effect, fiat currencies and debt are like inverted pyramids resting on a small base of actual collateral.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Bitcoin vs Fiat Currency: Which Fails First? What if bitcoin is a reflection of trust in the future value of fiat currencies? I am struck by the mainstream confidence that bitcoin is a fraud\/fad that will soon collapse, while central bank fiat currencies are presumed to be rock-solid and without risk. Those with supreme confidence [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[4174,124,127,309,950,587],"class_list":["post-28738","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bitcoin","tag-central-banks","tag-charles-hugh-smith","tag-fiat-currency","tag-fraud","tag-of-two-minds"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/28738","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=28738"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/28738\/revisions"}],"predecessor-version":[{"id":28739,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/28738\/revisions\/28739"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=28738"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=28738"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=28738"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}