Dear Reader, |
I was cleaning out my desk yesterday when I found something that stopped me cold. |
A savings account statement from 1995. |
The balance? $50,000. Not bad for a working guy back then. But here's what really got my attention: the interest rate. |
6.5%. |
That means my $50,000 was earning $3,250 a year. Just for sitting there. No risk. No stress. No sleepless nights wondering if some politician was going to tank my savings with another "stimulus" package. |
Today, that same $50,000 would earn you maybe $500 a year in the best savings account you can find. |
What happened? |
Simple. The Federal Reserve decided that savers don't matter anymore. |
For the past 15 years, they've kept interest rates near zero to bail out banks, prop up the stock market, and make it easier for the government to borrow money it doesn't have. |
Meanwhile, they've printed so much new money that your dollars buy about half what they did when that old statement was dated. |
It's the greatest wealth transfer in American history. From savers to borrowers. From the responsible to the reckless. From people like you to people like... well, the people running this mess. |
And I started wondering: what would it take to fix this mess? |
The government owes $33 trillion and counting. Social Security needs constant bailouts. Medicare costs keep exploding. |
Either they cut spending (not happening), raise taxes dramatically (political suicide), or... they keep printing money. |
That's when I stumbled across something interesting about Bitcoin that I'd never really thought about before. |
A friend mentioned that Bitcoin has a "hard cap" - only 21 million will ever exist. I figured that was just marketing talk, like when companies say "limited time offer." |
But it's not marketing. It's actually written into the code. |
Think about that for a second. Every dollar bill in your wallet exists because someone at the Federal Reserve decided to create it. Every bond, every bank deposit, every government promise - they all exist because some human being or institution decided they should exist. |
Bitcoin is different. The 21 million limit isn't a policy that can be changed by committee. It's mathematics. Like saying there are 360 degrees in a circle. You can't vote to make it 400. |
I found myself going down this rabbit hole, reading about how this whole thing actually works. |
Turns out, Bitcoin gets harder to create over time. Every four years, the rate of new Bitcoin creation gets cut in half. It's like a gold mine that automatically produces less gold each year until eventually it produces none at all. |
Compare that to dollars, where the production rate seems to double every few years. |
It's fascinating when you think about it. Here's this thing that operates completely outside the normal system. No Federal Reserve. No Treasury Department. No politicians making promises they can't keep. |
Just math. |
Now, I'm not ready to declare Bitcoin the answer to everything. Hell, I barely understand how it works. |
But I do understand scarcity. And I understand what happens when you have limited supply meeting growing demand. |
More interesting to me is watching who's paying attention to this stuff. |
It's not just tech kids anymore. Pension funds are starting to add Bitcoin to their portfolios. Insurance companies are buying it. Even some central banks - the same institutions that create fiat money - are quietly accumulating it. |
Why would a central bank buy Bitcoin? |
That's like McDonald's investing in a burger competitor. Unless they see something coming that they're not telling the rest of us about. |
The whole thing has me curious in a way I wasn't expecting. |
I'm not telling you Bitcoin is the perfect investment. I'm still figuring out what I think about it myself. |
But I am starting to think that maybe - just maybe - we're watching the early stages of something pretty significant. |
When the people who control the money supply start buying something they can't control, that tells you something about where they think this is all heading. |
And when a 30-year finance writer starts questioning everything he thought he knew about money... well, that probably tells you something too. |
Stay sharp, |
Glenn Short |
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P.S. I keep that old bank statement on my desk now. Not as a reminder of what I had, but as a reminder of what they took away. And more importantly, as a reminder that the rules have changed. The question is: have you changed with them? |
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