Bitcoin dips below $10 000 for a brief moment, could it be the last ever?

As predicted the $9200 support held during the recent Bitcoin price drop. Actually price only fell to around $9500 and has since bounced up to over $10 000. There was massive buying as can be seen on the four hour chart volume levels, where the low printed a super long-handled hammer candlestick pattern. This is a clear sign of price uptrend or upswing and change in direction. Buyers were keen to get some sub-$10k Bitcoin.

Record breaking low on the 4 hour RSI has just formed at 13 out of 100, this is the most oversold we have been since November 2018. That was the last time the 4 hour reached such oversold levels. To me this looks the time for a large upswing in price is due. I wouldn’t be surprised if price dipped still more to that $9200 level though. The last time the 4 hour RSI was so low, back in November 2018, was the fateful price crash from the long-held $6k region. From there we saw a massive dip of 50% to just over $3k, the lowest low for the recent bear cycle.

Since Bitcoin price has already fallen 15% in the past 48 hours, I wouldn’t be surprised if we repeat the pattern of November 2018 and see more of a tumble in price, so don’t get overly optimistic just yet. Allow price to show itself. If an uptrend emerges now then buy in on the way up, rather than try to call the direction right now.

On the daily chart we can see that price has just bounced off the 100 day EMA or moving average price level. This is on the Bittrex chart. I’m using it today for the USDT price equivalent because Binance is down for maintenance for about six hours. Curious timing just as we see this particularly noteworthy dip in the price. Price has not dropped back down to the 100 day EMA since late February when we were still in the $3000s. Hopefully this is the perfect place for price to bounce back upward.

The RSI on the daily chart is at a local low support level of 40, though could drop still further to 36, which is the support we saw in February during those low prices. It does look like the RSI is curling and leveling out so let’s see that as a bullish potential.

MACD on the daily chart has just crossed negative earlier this week as the downtrend kicked in, and may still indicate some more downward momentum, so again be prepared for more dip in price or at least some sideways range bound trading at these lows. This is a decent place for re-accumulation. We can never be sure when the bottom is in to buy, so it may help to start dollar cost averaging in already, at each dip and stabilization of price.

This is for the more high risk traders. The more conservative type would wait until they see a clear uptrend in price before buying in, but the medium risk trader would start buying in already, in small amounts, never all at once, in case price drops still further. The really conservative trader would refrain from buying in at all until price dropped to the 200 day EMA around $7000.

For me the fact that Bitcoin price has already tested the 100 day EMA now and found support, is a sign to start buying in. Already price is back up above the psychological $10000, having spent only seven hours below it. It’s uncertain just what price will do, so if you missed that sub-$10k Bitcoin window there, the chances of it returning there are about 50%. What a missed opportunity, we might look back and think one day. None of this is financial advice, just my opinion based on observation and nothing more. We’ll talk about the world economic instability and it’s impact on Bitcoin price at another post. Happy trading.

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The secret to wealth and happiness that cryptocurrency trading can’t give you

Having spent the past two years studying technical analysis and teaching myself the art of trading, I will tell you that I’ve learned a lot but also know how much I still need to learn. Knowledge is based on two things – theory and practice. In any endeavour to learn a new skill, it takes time and effort. The challenge with trading is that it also involves learning curves that can be costly. However, this is the only way to learn the skill. By regular practice. As it is with all things in life.

With the discovery of cryptocurrency, I was totally new to economics, finance and trading. The intuition that there was easy money to be made in becoming a trader came to me years ago already, but I always felt unqualified, having not studied it. But then I discovered Bitcoin and it was this adventure in crypto that brought me to want to express my long held dream of being a trader. What better platform than in the volatile and potentially lucrative field of cryptocurrency trading.

And the most interesting side of it was day trading. Here I could stare at charts all day, watching the price movements on all time frames. And daily there would be amazing potential gains to be had. Of course, they are easy to see in hindsight, and for the novice they play upon the greed inherent in all of us. Greed and fear, these are the two instincts that a trader will discover within his or her personality, whether you like them or not.

Trading is a psychological business, and it teaches you about your own mind, with its strengths and weaknesses. Just like any application of effort against some sort of challenge or competition, you learn about your shadow side, your hidden strengths and your own mind. The mind can be ones best friend or worst enemy. It is not to be trusted. It is the intelligence, which is above the mind, that we need to listen to if we want to succeed in life and trading. The mind will demand satisfaction of the basic drives, like survival and profit. But the intelligence, based on learning and experience, will determine whether you succeed.

For example, in the eagerness to catch all the possible profit from the simple price movement of your favourite cryptocurrency, you may try to look for or identify as many trades as you can – one every day if possible. But sometimes the best move is no move. There is no use trying to force a trade just because of greed or over-enthusiasm. Some days do not present genuinely valuable trades, and it is then important to know one of the best skills in trading, and in life – how to do nothing.

Not doing is the solution to overdoing, which usually causes us to force the issue and end up losing out as a result. Here we need to pick our trades with intelligence, not out of desperation. Making money from trading is as much about wealth preservation as it is about wealth creation. Protect what you already have, defend it like a bear. And then secondly comes the attempt to grow your account, like a bull.

With Bitcoin it is easier, I feel, to make a profit because price usually returns to previous highs. Bitcoin is a unique product in that it is destined to climb onward and upward. There is less chance of it losing value in the long run and much more likelihood that it will continue growing in price as it has for the past ten years. The dips are occasional, and even if it takes a year, price returns to its former glory and surpasses it each time. The same can’t be said about the other altcoins.

Add to that the much greater potential profit in the volatile crypto market and you have an easier place to learn the skills of trading. After over a year of attempting to make money as a trader, I was able to make some small gains and learned that your style of trading reflects your personality. There are small quick day trades of a few hours that bring 1-3% profit, for the side of me that is impatient and enjoys the fast action of quick trades, as well as hating to lose anything at all. Then there are the longer swing trades over a few days, that bring 5-10% profits for the patient side.

Then there are the high risk trades for the greedy mind, like when a new coin or IEO is launched on an exchange and the volatility goes through the roof. The desire to grab some of that price action was high in the early days of trading, but I soon learned from a few losses there that this is also just as risky as it is profitable, and that it was my greed that was getting the better of my intelligence.

Then there is “hankering” and “lamenting”. These are both obstacles on the path of life, and they certainly show themselves in trading. There are so many huge potential profits every day to be seized by the discerning trader, but they are all seen in hindsight. Nobody can fully time the bottoms or the tops to capture all the price movement seen in those attractive price swings. So we see them and hanker after them, or we lament that we missed them. I would sell at a small profit, only for the price to keep climbing and I would miss accumulating twice as much as I could have in a particular trade, for example. This goes on all the time, but we need to remember that such allures are not worth losing sleep over.

By catching even just a fraction of a price move, we can add to our profits as a trader. And we need to learn to be content with that, otherwise we will find ourselves on our death bed still hankering after illusory pleasures of the body, or lamenting sentimentally about some loss or missed opportunity which is long gone. We might feel like a teenage romantic, who longs for a requited lover, only to cause our own emotional depression for no intelligent reason. You are the cause of your own depression when you put too much value or place too much attachment onto the object of your desires.

Whether it is a lover, or just plain money, as long as you are too attached to it, that very thing will destroy you. Attachment is a symptom of greed and too much ego. And an intelligent person soon realizes that they are the fool if they invoke a mood of depression upon themselves because of some outside factor, like another person’s opinion of you, or a mundane object like money. This is a major pitfall in trading. It cultivates within the mind of the trader too much obsession with money. That is why I occasionally take a step back from trading, to give me perspective.

The feverish mind will be inflamed when meditating on the objects of the senses excessively. Whether it is the desire for sex or money, you will be feeding the flames by staring at the object of your desires. And those flames will consume you, dictate your feelings of well-being or lack thereof when you obsess about them. In trying to chase happiness, you will be dragged into lamentation if you become overly focused on the external object as the source of your happiness.

We need to learn to cultivate self-satisfaction, or contentment within. We should never allow our equanimity to be dependent on the objects of sex or money. I have learned this from life, now as I reach old age. I can give you youngsters some advice based on experience. Don’t get trapped thinking it is the external money or lover that will bring you happiness because that money will come and go if you’re a trader, and the lover will come and go most of the time too.

Yet you need to be able to feel complete with or without the external object. It is not the source of your joy in life. Your mind is the source of your joy or distress, so rather cultivate the right mindset independent of the circumstances. You should be complete as you are, so cultivate that attitude, and if you need to, then afterwards supplement your life with the pursuit of money and sex.

If you want my secret to happiness then this is it. I am giving it to you for free based on 50 years on the planet. It’s all in the mind – the subjective feeling of being rich or poor, in love or lonely – these are up to you and your interpretation of your situation, not up to the external factors. It’s all a matter of perception. As long as you are dependent on some outside ingredient, you will suffer, because it will come and go. Find wealth and love within, and all around you in the freely existing attributes of life, and you will be the wealthiest and most loved person in the world. Now you know.

BTC TA the easy way – breakout arrives and descending channel holds

As was to be predicted, the much-anticipated breakout of the Bitcoin price from the narrowing wedge did arrive, except it went to the downside, when I was hoping for the opposite. The drop of just under 5% initially was minor and there are other positive indicators that keep my opinion slanting towards the bullish side which I will mention now.

The initial breakout on the past Saturday, within the past 48 hours, was much smaller than expected. Around 5% is not much movement for Bitcoin, particularly on a weekend when volume is low and price is easy to manipulate by some large whale.

The massive volume candle at the time of the break to the downside showed a lot of selling. Many analysts and traders were probably watching for the same imminent breakout and when it showed itself, everyone hit the FOMO button and rode the short to the shore. The support around $11 200 held well, with only one break, which was quickly bought back up by the bulls. This indicates strong defence of this area above $11k for now.

On the 4 hour chart of Bitcoin we can see that the 21 day Estimated Moving Average has just crossed below the 50 day EMA. On the other hand the 100 day EMA has just crossed bullish up over the 200 day EMA. This is a little mini golden cross if you like. We could see a major converging of price into more sideways range bound movement in the short term.

If we zoom out and look at the longer term picture, we can see that Bitcoin price is in an overall gradual descending channel, since the recent yearly high of around $14 000. I was being overly optimistic recently in hoping for a breakout of price from this channel to the upside. Price was right at the top of the range when the breakout occurred to the downside recently.

Volume continues to decline on the daily and 4 hourly, though not significantly. One interesting point is that price is right around the 50% mark on the Fibonacci retracement line from the ATH around $20k to the recent bottom at $3100. I am an admirer of the Fib tool and the philosophy behind it of the universe being all in alignment with the Golden Ratio on all levels. Throughout Bitcoin’s price history we can see how price seems to follow the Fibonacci levels on its swings between high and low.

The 50% retrace in price is around $10k, from the ATH of $20k, but the Fibonacci retracement tool puts the 50% retrcement point between the $20k point and the $3 100 low, at around our current price – $11 400. Hopefully price can hold this level, which was a crucial resistance level back in the bear market of 2018. In February and March 2018 price twice tested this level and was unable to break above it. In our current situation, since we are above it, I’m hoping that this $11 400 region can act as support, though it is on the edge at the moment.

On the daily chart, the 21 and 50 EMA are still well above the 100 EMA and aiming upward. In coming days they could all align possibly. I have noticed repeatedly how such alignments where at least three EMAs converge, can result in a breakout in either direction. Naturally as price squeezes into an ever-narrowing band, it coils up like a spring, only to demand an outlet at some point.

If price continues in its current format, then we should see some more downside toward the lower edge of the descending wedge on the daily chart. The next Fib level down is at the last two lows of the double bottoms of July, which is around $9 300, give or take $200. That is also where the current 100 day EMA is sitting. Depending on where the 3 EMA prices converge in coming days, that is where we could see our next breakout in either direction. This might be at the end of the month latest.

None of this is investment advice of course, just my opinion. We also need to consider the fundamentals and also the current global macro economic trends and their impact on Bitcoin price direction. It may be a more attractive safe haven to some now. Bitcoin certainly wasn’t around in the last financial recession of 2008, so this is new territory for everyone. Let’s see which way the flag flies this time around.

Litecoin halving has arrived

This is it guys, the Litecoin halving that has been anticipated for months has come and gone. The next one will be in 1457 days, or around August 2023. This is a built in event that occurs every 840 000 blocks. Price had a nice little pump today to celebrate the event, of over 10%, but then settled back down to the mean just below $100 at the time of writing.

This was so well anticipated that – as happened at the previous Litecoin halving which is already baked into the price action – the pump happened a while ago already, just over six weeks ago, on 22 June. That was the day LTC peaked just below $150. Since then it dropped to $80 and is now back up at close to $100. If we carry on like past history shows, then price should trade sideways for a while before beginning to climb once more.

In total 75% of all LTC, or around 63 million of the 84 million have now been mined. The well known silver to Bitcoin’s gold has come a long way, launched as a fork of Bitcoin itself, back in October 2011 by ex Google employee Charlie Lee. He also worked as Engineering Director at Coinbase, one of the more popular exchanges globally.

The decreased block generation time of only 2.5 minutes, along with the increased maximum number of tokens ever to be mined make it a token useful token, though still a Proof of Work (PoW) coin, mined like Bitcoin. Curiously LTC is more expensive to mine, since it uses not SHA-256, like Bitcoin, but rather Scrypt as a mining algorithm. Other scrypt-based altcoins include Doge (much interlinked with LTC), Bitconnect and some other lesser known tokens.

Mining equipment is more complex and thus pricier at this stage. So how are the miners handling the halving today? Miners will receive half as much reward for mining LTC, which now provides them with 12.5 LTC per block mined. So theoretically price should begin to climb once again soon, due to the new scarcity.

Halvings like this occur in Bitcoin too, the next scheduled for 2020, not long to go now. It is an interesting phenomena, written into the code of the coin. Satoshi Nakamoto, the Bitcoin founder, added it to keep the balance between miners and price, and traders of course. The math is irrefutable. Less coin emerging will increase price if demand stays the same. It’s a fail-safe built into the system every few thousand blocks produced. Long term vision is what has allowed these cryptocurrencies to survive. Litecoin is still in the top five, having just dropped from number four place by market cap, and will probably remain there for some time to come.

All the altcoins are currently falling behind Bitcoin is price growth this year so far. Litecoin did really well until about six weeks ago when it stalled, but I’m bullish on LTC going back into a bull trend, since it closely follows Bitcoin in price action, whether up or down. The recent price gain this week is only 7% compared to Bitcoin’s 22%, so it looks like the king of coins is pulling ahead of the pack, and at this rate the pack may never be able to catch up.

We are all still awaiting the now mythic altcoin season but rumours are starting to circulate that it may have been cancelled. Even though LTC has been designed to be faster than BTC in production and transaction speed, still it languishes in the shadow of its older brother. Will the altcoins ever regain their Bitcoin value? It certainly doesn’t look like it. I have my doubts. So far this year when Bitcoin climbed in price, it left the altcoins behind. And when it fell in price, it tended to drag the altcoins down with it, so it was a no-win situation for the altcoins in general, bar a few exceptions. The hope is that if Bitcoin can trade range bound in a sideways movement for a few weeks, the alts might have a chance to pump higher in BTC value, though it all depends on the BTC price action. And since BTC is mostly just going parabolic nowadays, it looks like the king is dominating the show again.

BTC dominance is at 67,5% according to https://coinpaprika.com/ today, with $209 billion in daily volume, while LTC is way behind at a mere $6 billion. They are worlds apart in this regard, though LTC is in tight competition with Bitcoin Cash, another hard fork of Bitcoin, for fourth place. What does Bitcoin have that none other can compete with? It has first mover advantage, and name popularity perhaps. Other alts are certainly faster, cheaper to transact and some are even more private, but somehow Bitcoin stands head and shoulders above the rest.

This could be a sign of the shape of things to come in the crypto industry, where Ethereum, Litecoin and all the others are left in the dust of the original one and only Bitcoin. It mostly depends on the miners of course, and with Litecoin being pricier to mine, it could hint at why Bitcoin is outperforming it. Many miners of LTC may have to shut down their rigs now with the halving of their rewards…for a while at least. We will have to watch this closely. Less miners means less coins produced and therefore price rises, which may then bring the miners back into the business. So it can all sort itself out in time, we hope.

Beside that though, we need to remember that market sentiment is one of the biggest drivers in crypto too. And once the mining hash rate drops, the mining will go through its own difficulty adjustment and smaller miners will be able to resume operations once again. As a more durable token for actual spending or transacting and moving, LTC is here to stay along with Bitcoin, so bag hodlers need not worry too much. Price will maintain and grow once more as production normalizes on the blockchain.

Gold vs Bitcoin debate – Schiff and the Pomp go head to head

If you’ve watched the latest Gold vs Bitcoin Debate: Anthony Pompliano vs Peter Schiff which aired recently then you would have seen the old Gold Bug himself, well known for his publicity, and opposite him The Pomp our “Bitcoin bug”, in the debate of the season so far. Check it out

[here]

(https://www.youtube.com/watch?time_continue=14&v=Wigz8z6Vm3U) if you get a chance.

The overall impression of the just under an hour long close-up, face to face event was of a louder, more New York-like Peter Schiff against a military hair-styled but much softer spoken Pomp. They are both die hard evangelists for their cause, though Pomp is overtly also supportive of gold while Schiff is totally averse to Bitcoin.

Schiff was accurate when he called the Bitcoiners out as almost religious in their devotion to their fledgling cause. Why reinvent the wheel, was a phrase he used, with gold having a 3000 year history to back it, compared to Bitcoin’s ten.

Early on Schiff made it clear he thought that the Bitcoin price had peaked and was never going to see $20k again. He even thought this last pump to $14k was a weaker and completed attempt at the next ATH. He had no idea that this is just the start of the next bull run. We have only been climbing for six months. How can he think this is the end of the bull run, which can go on for a year or two still?

Schiff was adamant throughout the debate that Bitcoin had absolutely no intrinsic use, compared to gold which has numerous uses like engineering, tech, jewellery and even dentistry. It was hard to convince him otherwise. He totally stood his ground throughout the entire debate.

The only time he conceded any positivity toward Bitcoin was at the end when he said he does feel sorry he missed the boat when Bitcoin was $10, as he could have bought then and been a billionaire today. But he refused to use that logic to inspire him to buy now with the insight that price is still set to climb much further.

Pomp even explained to him how at best gold will only climb to around $5000, or say 3-4x but Bitcoin is set to climb 10-100x. Schiff was having none of it. To him the value is completely based on the confidence people have in it that they can sell it later at a profit to someone else. “They are just hodlers.” Schiff certainly knew the terminology. He didn’t know long term Bitcoin price TA though.

Even when Pomp presented the fact that onchain settlements in transactions topped $410 billion in 2018, more than Venmo, PayPal and ApplePay, still Schiff threw the “wash trading” saga at him, calling it spoofing. Got to admit he has a point there. Pomp reckons it’s hard to fake that much volume but researchers have

[shown]

(https://www.forbes.com/sites/tomrodgers1/2019/04/04/99-of-volume-could-be-wash-trading-as-bitcoin-takes-back-5000/#735c25a323d5) that much of it is indeed fake.

Pomp made a good point that just as gold used to be the original layer one store of value but was difficult to transport and so we introduced paper notes as a layer two and then electronic money as layer three, similarly Bitcoin is to be seen as layer one technology which doesn’t need to be scalable for transactions like buying a cup of coffee as there will be other layers that will be built on top of Bitcoin as layer two and three to actually transact with.

One point the two of them both agreed on is that the dollar is a lousy store of value, and that people will turn to the alternatives very quickly when they really see it start to depreciate in the possible coming recession. Pomp really put a strong point across when he noted that since going off the gold standard in the seventies, gold has increased 40x in value but Bitcoin has done that in the last two years alone. We have to admit that gold may be a stable store of value by comparison but it is no match for the potential profit Bitcoin has in it, particularly considering the abilities of the internet to make Bitcoin go viral overnight. We simply can’t compare a 3000 year old commodity to a ten year old one.

The existential philosophical meaning of money was hotly debated here and the conclusion is that money is ultimately just a belief system that only has value if both parties agree on its value. It is based on confidence. The only reason we have confidence in the dollar is because it is backed by a government with a big army to enforce our acceptance thereof. And if they continue to keep printing it into inflation and loss of value, then obviously confidence will be lost in the dollar. And that is what is currently happening.

The debate went on like this and I really recommend you watch it if you’re interested in the philosophical points used to validate both gold and Bitcoin as a commodity of value, from the cryptographic and algorithmic strength of Bitcoin, with its foundation in math and software on one hand to gold with its multiple uses in jewellery, dentistry and electronics on the other.

Schiff really thinks that Bitcoin has maxxed out its appeal and is on the wane, showing his lack of awareness I would say because Bitcoin has only just begun. Blockchain technology is the next level of the digital revolution. Banks and nations are adopting it one by one. Some people are old school and can’t see the potential in the future tech and some are progressives who forget the value of the traditional wisdom sometimes. We need an appreciation of both in my opinion.

Conclusion

Schiff can present the “greater fool theory” in describing buyers and sellers of Bitcoin, but it is the best performing asset of the past decade – by far, and it’s history shows that it rises after each retracement. Pomp really ended well when he humorously quoted Satoshi who once wrote to a colleague in the very early days of trying to explain it for the first time, saying if you don’t get it, I don’t have time to explain it to you. The fact is that it works and the coming months and years will confirm the inherent value of Bitcoin. An excellent debate all round from the titans of their respective fields. Check it out when you get a chance.

What is money part 2 – the crime of commercial bank money

In our current new era of cryptocurrency, built on the blockchain, we are becoming more familiar with the concept of digital money, beyond paper notes and coins. However, most money today is already digital, just like that used via Visa or debit card. It’s numbers in a computer which we use to run the economy. Here in part two I want to show further how fraudulent the current monetary system is, and how this is the biggest global crime and actual tool of enslavement wielded by a small group of elite banking families and their staff, some of whom are unaware themselves of what their masters are actually up to.

The illusion

Most people think that the government or its central bank issues the new money into circulation but that’s not the case. It’s private banks that create the vast majority of new money in circulation. And also decide how it is allocated. The official terminology for this accounting entry is “commercial bank money”. So when banks issue loans to the public, they create new commercial bank money. When a customer repays a loan, commercial bank money is destroyed. The banks then keep the interest as profit.

There are a lot of misconceptions about the way banks work. A poll by the Cobden Centre in the UK about a decade ago found that 30% of people think that when you put your money into a bank, it just stays there and is safe. This is how we were taught as children with our piggy bank. Another 60% assume that when you put your money in, that money is being moved across to someone who wants to borrow it. But banks don’t work like that either.

“It’s basically an accounting trick…Banks create money. They don’t lend it…when a bank gives out what is called a loan, it basically pretends that you have deposited the money…it has to invent the liability…this is how the money supply is created.” Prof Richard Werner

The illusionists

Today in the UK for example, as well as other developed countries, money creation and control is largely in the hands of private banks. About 97% of money that’s created is created as bank “debt money” you might call it, where banks issue money into circulation as loans. It’s not a conspiracy theory, it’s the way the Bank of England describes the process.

“When banks make loans they ‘create’ additional deposits for those that have borrowed the money.”

Paul Tucker, Deputy Governor of Bank of England (BOE quarterly bulletin 2007 Q3 vol 47 no 3)

Most economists realize how money works but if you don’t and think that everybody saving will help the economy, you’re wrong because what really happens if we all start saving is that the amount of money in the economy shrinks and we have a recession. And money is the very centre of the economy. If you don’t understand where it comes from, who creates it and how, then you will never understand the entire economy.

How massive is the illusion?

Creating electronic money is much more profitable than creating cash because there is no production cost at all. Now while the UK Treasury may have created 18 billion British Pounds over a decade, the banks themselves have actually created 1.2 trillion Pounds. In this way between 1998 and 2007 the UK money supply tripled.

On 9 March 2009, the Federal Reserve governor, Ben Bernanke gave the first broadcast interview ever for someone in his position. The day before that he had bailed out AIG for $160 billion, which is an insurance company, not even a bank. This is during the last global recession. So when the journalist interviewing Bernanke asked him where he got the $160 billion he said

“It’s not taxpayer’s money. The banks have accounts with the Fed..so to lend to the bank we simply use the computer to mark up the size of the account they have with the Fed. So it is much more akin, though not exactly the same, to printing money than it is to borrowing.”

Banks in other words simply create new money whenever they extend credit, buy existing assets, or make payments on their own account, which mostly involves expanding their assets. When you try to explain how money works, there is often an almost built-in refusal to accept that such a bizarre situation could actually exist. Banks create money out of thin air…?

By 2008 the outstanding loan portfolio of bank created credit, aka commercial bank money, stood at 2 trillion UK Pounds. Back in 1982 the ratio of notes and coins to bank deposits was 1:12. By 2010 it was 1:37. In other words there was 1 Pound of physical currency (government treasury money) for every 37 Pounds of digital currency (bank created money).

In the 10 years prior to the 2007 crisis, the UK commercial bank money supply expanded by between 7% to 10% every year. This means doubling the money supply every 10 years. The amount of money being created out of nothing is just incredible. And this, dear reader is the real crime, the crux of the matter. This is why prices go up. It’s because your money’s value goes down as banks create more of it out of nothing.

Conclusion

The banks are stealing your ability to buy food and essentials like this, they are making you poorer. And the new money they create is being distributed according to how the bankers see fit, not the government or any humanitarian agency or anyone in society. We are being systematically robbed of purchasing power daily as banks continue their fraudulent, immoral and – in my mind – criminal system throughout the world.

Unless we end this banking system, we will never ever escape the inflation eating away at our personal wealth, our hard earned money. We will never end debt and the slavery it imposes on us. The debt can never be repaid using this system of creating more of it every time imaginary money is created. There will always be more debt then money. It’s time for us all to become aware of what is going on in the world of money, of what the system actually is into which we are born.

We take for granted the financial shackles with which we are born, and think it is normal. Well it isn’t, and it’s up to us, the masses, to take back our power from the global banking elite slave masters. How long will you continue to live in debt, and hand an ever increasing debt to your children. The national debt, the global debt shared by each country, is the yoke imposed upon us by the criminal elite bankers and I will no longer suffer these fools gladly. Who has the courage to join me? Give up using banks, boycott the banks, use cryptocurrency instead. The revolution has already begun.

What is money? Part 1 of a crime exposed

For centuries the mechanics of the money system have remained hidden, yet the impact globally is unsurpassed. This is due to the monetary system being the primary tool for those who run the world to maintain power and control. It is this power which is being used to crush the poorest of humanity and needs to be stopped. Cryptocurrency like Bitcoin, built on the revolutionary layer of blockchain technology may be the answer to this fiat money criminal banking system once and for all. It has the ability to return to each individual their sovereignty, and free us from the shackles of modern day financial slavery.

Today these very levers of power are being shaken by crises, of which the 2008 crash was just a glimpse. The boom and bust design that is built into the modern attempt at capitalism occurs every decade or so, ruining millions of people each time it occurs. It simultaneously scoops up money and assets in the net of the very wealthy, who simply become richer and more powerful on the backs of the downtrodden. This is something unacceptable and inhumane and thus the need for dialogue and revision regarding the global financial system is more crucial than ever.

The economic crisis of 2008 was like a cancer, it was staved off for a while but the malignant tumor still exists, and is now killing the host, us, in a form more virulent than a decade ago. And the answers do not lie with government because

“Governments do not rule the world, Goldman Sachs rules the world”

Alessio Rastani

Add to this of course J P Morgan, Chase, Rockefeller, Rothschild, and the 1% banking elite family dynasties, who have been in power for hundreds of years, much longer than most governments. And in their pockets are the corrupt and subservient government leaders of today. They may not have started off corrupt as a civil servant, but any politician who desires the fame and power of such a position, will have to sell out his or her morals to the dictates of the banking elite. The masses who need the protection the most, will take second place to the demands of the super rich aristocracy of the day. We are just cattle to them.

This baked in cycle of boom and bust in the financial machine has been around since the 1700s already, around the time the Bank or England was founded by William Patterson. Basically the system is by default unstable because it gives global power to the dominant parties involved. Historically is can be statistically shown that every time an empire begins to show signs of collapse, its currency will be debased or devalued.

There is no clear guide to how this financial system operates. Just ask the Bank of England how money is created. Or ask the Federal Reserve of America. Alan Greenspan, an ex Fed Head, once said, famously, that they have licence to print as much paper currency as they want whenever they want. They can print themselves out of any financial crisis. The problem is that it is the printing itself of more pieces of paper currency that deflate the overall value of your actual money, ultimately driving it to a point of collapse where it is worth zero.

How money is created – notes and coins

In 2010 the total UK money supply stood at 2.15 trillion Pounds. 2.6% was physical cash (53.5 billion) and 97.4% was commercial bank money, or digital numbers. So less than 3% of money is created through the central bank. There is no interest charged on that money, which is transferred to the government Treasury as a form of funding called

“seigniorage”: Profit made by a government by issuing currency, face value on notes and coins minus their production costs.

A $10 note cost about $0.04 to make. It is sold to a major bank for $10 or face value and the profit goes to the treasury. This reduces taxes we pay. In ten years they could raise about $20 billion in this way a decade ago.

In 1948 notes and coins constituted 17% of the total money supply. Government back then could use it to finance post-war reconstruction, including national health and government hospital services.

In the past 60 years since then notes and coins have shrunk to less than 3% of money.

The ironic and curious thing is that before 1844 bank notes were created by private banks and the government did not profit from their creation. In fact in pre-industrial times back then, there were thus multiple forms of money all co-existing. So the idea we have today of numerous different moneys in the form of cryptocurrencies is nothing new. The rise of a single sovereign government backed fiat money is a recent phenomena. In the 1840s there was no law to stop banks from creating their own bank notes. They used to issue pieces of paper as literal bank notes to represent what you had in your bank account. This meant you didn’t have to carry your heavy metal coins around to pay people but could use your piece of paper to show how much you had in the bank, which you could give them instead. In time these paper notes became as good as money.

When the banks saw that they were creating in this way the dominant type of money in the economy, they realized that by creating more of it, they could generate profits. They could just print up some more notes to lend out and get the interest on top of them. This went on until the 1840s, until it went a little bit too far and caused inflation which destabilised the economy. So in 1844 the UK Conservative government of Robert Peel passed a law that took the power to create money away from the commercial banks and brought it back to the state. Since then the Bank of England has been the only organization allowed to create paper notes.

But now everything has gone digital. What we now use as money is digital numbers that commercial banks can create out of nothing. Legislation needs to catch up with developments in electronic money and the way that banks actually operate today. Money held in bank accounts are called “demand deposits”. This is an accounting term the banks use when they create credit, as well as loans. So all “money” held in banks is nothing more than an accounting entry.

This system is fraudulent and in the hands of the biggest pirates on the planet today, the banking elite and the Fed. It has to be ended, as some in America are calling for. And a healthier global economic construct needs to be engineered, one that caters to the well-being of all humanity, not just the elite 1% who currently live like parasites sucking the life out of the poorest and most vulnerable, you and me, through the current criminal banking system.

In a future article I will continue to explain the modern criminal banking system and how it works today, so stay tuned and let’s educate ourselves on why we are so poor, why we are in such huge debt, why we have to endure crashes every decade and why our money keeps shrinking in purchasing power. Power to the people. Take back your power. Overthrow the banks.