In today’s Money Morning…squaring the circle…why GovCoin is a threat to us all…free-thinking people need to know the facts…and more…
Here’s the state of affairs from last week…
Iron ore prices — record highs.
Copper prices — record highs.
Lumber prices — record highs.
Corn prices — eight-year highs.
Rapeseed and soybeans — at, or close to, record highs…
Everything it seems is going up, including stock markets.
Even gold looks to be bouncing from its recent dip!
From these figures it would appear the economy must be booming.
But then these numbers appeared…
Squaring this circle
The important non-farm payroll numbers came out last week.
This is a key economic indicator showing the number of jobs created in the US.
Analysts, probably seeing the booming numbers we talked about above, had high expectations here. The consensus estimate was around one million new jobs and an unemployment rate of 5.8%.
But the actual number came in at just 266,000 new jobs and an unemployment rate at 6.1%.
That’s a big miss.
Of course, markets rejoiced at such ‘bad news’ as investors started to price in the fact that low interest rates were now likely for much longer.
But let’s think about all this for a second…
You have an ‘everything’ boom, especially in commodities, which would indicate an economy firing on all cylinders, and yet the jobs figure says the exact opposite.
This story is probably the story of 2020.
We all saw what happened during the pandemic when stock markets boomed as the wheels of commerce grinded to a standstill.
I think we witnessed the complete and final disconnect between the markets and the economy.
The tether between money and the economy is now broken. And I think fatally so.
This is a conclusion also reached by my colleague Editorial Director Greg Canavan.
We both spent much of last year trying to square the circle of what was happening in markets against what was happening in real life.
Greg’s actually been looking at this since the GFC in 2008.
The only answer we could come up with is that money is dying.
No one wants to be left holding the bag of worthless fiat, so they’re putting their dollars into land, stocks, cryptos, commodities…anywhere but a bank account earning peanuts in interest.
Of course, we don’t mean money itself is going away. Or that the dollars in your pocket will become worthless overnight (though people in some other countries have real fears of this).
What we’re saying is that the system of money we’re going to be using over the next decade is going to be different at a fundamental level. We’re moving away from a petrodollar system built on unsustainable debt.
This is probably the most important background story to every single investment you make. And yet few are talking about it.
That’s why we’ve just launched a new service, called New Money Investor. It’s dedicated to following this story and in turn working out what comes next.
We think it’s probably the most exciting and challenging idea any of us have ever taken on.
And it’s an idea that is about more than just investing…
Why GovCoin is a threat to all of us
More proof that money is changing…
Central banks all over the world are experimenting as we speak with an idea called Central Bank Digital Currencies (CBDCs).
These are dangerous ideas.
Not content with ruining the existing system of money, the central banks think that giving them even more power over money is the answer.
The arrogance is breathtaking.
I won’t go deep into this topic today, but it is something we’ll be discussing in depth in New Money Investor.
Today, I’ll just point you to a front-page piece from establishment mouthpiece The Economist last week.
Here’s the headline:
Source: The Economist
The article goes onto say CBDCs — not bitcoin or Ethereum — are the ‘most revolutionary’ of all digital currency ideas.
But as Chief Strategy Officer of the Human Rights Foundation, Alex Gladstein, wrote on Twitter in response:
‘“Get ready for Fedcoin and the e-euro,” cheers @TheEconomist, which hypes CBDCs as more “revolutionary” than Bitcoin. They will shift power “from individuals to the state” and “are to be treated with optimism.”
‘When did this mag get so authoritarian?’
More power to the state?
No, thank you…
Yes, the future of money goes beyond working out where to invest — though that’s a key aspect to it, of course.
That’s why we say it’s probably the most important change since the end of the gold standard.
Free-thinking people need to know the facts. Before we have a new money system imposed on us that entrenches power of the same faceless bureaucrats that are causing many of the issues we’re seeing right now.
Editor, Money Morning
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