Notes Before 2008 vs. 2023
I think it’s a good time to follow up and show how the alignment for an economic downturn this year is shaping up. A few things to catch up on since the debt ceiling crisis:
The debt ceiling was raised again temporarily. It will need to be raised again to avoid government shutdown before the end of the year. This usually takes place with an Omnibus package.
The crisis in Ukraine has continued with no real winner on either side emerging. Geopolitical tensions are still tight with BRICS and NATO’s efforts to push as far into Europe’s Eastern border and the South China Sea as possible.
Israel and Palestine escalated their conflict with Biden asking Congress for almost a trillion more in aid to support the proxy wars.
The border crisis is now being funded with an effort to build a wall.
We are 1 year away from electing a president in the United States. This typically is very bullish for Bitcoin as the focus is steered towards other headlines, but now with the Republicans championing the issue as a reason to vote for their free market policies, it will be interesting to see how the markets react to major candidate support or rejection.
The SEC has lost all cases with Grayscale on its Bitcoin spot ETF product and, as of today most of the Ripple case has been dismissed or ruled in Ripple’s favor. It is only a matter of time before an influx of cash from institutions starts allocating Bitcoin through legal custodians and accounting practices.
In the past few weeks as this news has permeated, the price of Bitcoin has increased to meet its resistance of $30k. I expect a shift in public sentiment towards Bitcoin over the coming months and leading into the halvening.
I’m comfortable ending this bear market for Bitcoin. Even if there is another dip in equities that temporarily decreases its price, as seen during the COVID scare, the recovery will be 20 fold. I don’t think that will happen to Bitcoin this time. I think it now has enough support to thrive while other financial products, including fiat, fail. This is exactly what it was intended for.
Congratulations if you held or traded successfully through this bear market. It was truly a test to my will, but given the predictability of how these things go, I knew there wasn’t a better answer. I would also say it was harder than the last downturn. There were many factors creating pressure and I wasn’t sure if I would recover, let alone Bitcoin.
I suppose this could be seen as counting my chickens before they hatch, and we could drift sideways for a few more months until the SEC is out of time to approve products, but I don’t think the Fed can play chicken any longer.
Call me a false prophet if you’d like, but it’s time to cut rates after we break the markets, and we are about to break them. Look out below!
Next up, 2008 vs. 2023.