SODERMALM, STOCKHOLM – As I went for a walk yesterday evening, I heard warm notes of music drift through the chilly air.
I wandered towards the cheery sound, and discovered a brass band had gathered to play outside the supermarket nearby. The elderly group were arranged in a loose semicircle, led by a bearded man playing a silver euphonium, and were playing festive tunes I didn’t recognise.
A small crowd had gathered around them, and as I drew closer, a pair of schoolgirls as blonde and Swedish as you can imagine began a mock ballroom dance, laughing and twirling across the pavement.
There were no masks. No hesitant looks or judging glances. Just laughter and music amid the cold.
Of all the fond memories I shall keep of my escapade to Stockholm, this one is going to the top of the deck. The Christmas spirit here remains undiminished – nay, resplendent.
And that’s gonna make leaving painful. But Christmas and Hogmanay should be spent with family and friends, and I’m not one to break tradition. I may well return to Sweden in early 2021 – it doesn’t look like British politicos have lost a taste for lockdowns, tiers, firebreaks, and whatever else they decide to call them, and that’s the main reason I came here after all.
I’ll be away next week as I try to head back to Blighty without getting deported to Gitmo. But have no fear – you’ll be hearing more from my erstwhile colleagues Nathan Tipping and Will Dahl in my absence. They’ll be keeping you up to speed on what’s going on in the gold market – and in Washington DC, where the final cards of the US election are being played…
But before I go, it’s time for a rummage through the mailbag. When it came to predictions for 2021, some of you have very clear outcomes in mind:
Here are my 5 predictions for 31/12/2021:
1) Bitcoin will be > $30,000. The wall of institutional money waiting to get in is mind boggling. Sovereign digital currencies will be launched but you can’t regulate Bitcoin. It regulates itself!
2) Copper will be > $8,500. The green revolution and China will eat up every copper mine going.
3) Gold will be > $2,400. More stimulus and more debt write offs = hedge funds and other asset managers will likely allocate 5% to Gold in the next few years.
4) Money flows into emerging markets will make a comeback. Countries like Saudi Arabia, Pakistan, India, China – if you can find small cap stocks or ETF’s in these countries geared towards green/tech sectors, go for it!
5) US equities will fall. The Biden administration will increase corporate taxes.
Hope you all have a successful 2021!
You too!
This reader was somewhat less sanguine…
Never mind the investment predictions, we know it will be hell in a handbasket for pensioners and all living off dividends, so we must all become speculators. It’s 1974 again, with 20% inflation on the distant horizon, then stagflation as the demographic ‘slide’ in China kicks in…
The beer is unavailable on their website. How do I buy a case?
Quantitative Ease, the Booze, Booms & Busts double IPA, will be up for sale on the Cheddar Ales website a week on Monday. I’ll be back at the helm of Capital & Conflict by then, and will let you know in this e-letter. If you like your beer, I suggest you try some of Cheddar’s in the meantime though – it’s a great brewery.
I traded futures and options for over 40 years but for the life of me I cannot make head nor tail of Bitcoin, just do not have a clue how it works, how and where do you trade it etc etc so where can I find out. Is there a fools guide anywhere because am interested but need to know how it works first…
When it comes to the head and tail of bitcoin, I would point you to Sam Volkering’s book here.
Though on the topic of making head or tail of bitcoin, this reader takes a rather direct view:
Intrinsically Bitcoin exists in the imagination of the beholders…it has value if you and I agree that it does ( no different to gold and silver as a currency then ). But fundamentally it has no value; obviously only air, water, food, shelter and human cooperation have real value, the rest is in our cooperative imaginations and the more rarified a concept is then the more fragile its existence.
To attempt to supply the very definition of a concept such as Bitcoin, one has to take a preceding step, before the real analysis can begin to take place.
And that first step is to understand the language and terminology we are attempting to use to define it’s ‘reality’ (that’s if one defines reality as having value, be it positive or negative and illusion having no value… as in the final analysis no-thing is really there).
Of course this is not original thought, the esteemed philosopher Wittgenstein, made this process clear a long while back.
Quote;
‘…because Bitcoin miners are rewarded with freshly minted Bitcoins…’In a simple and honest analysis; there are no actual coins, neither is there actual mining going on nor a Mint in operation.
These are all archaic currency terms, used to describe the creation of gold and silver as a currency based on their value via their rarity in real physical terms, and they also have many other valuable uses besides being a chosen currency.
Bitcoin has taken a solid metallic reality and superimposed it onto an electrical & ethereal ‘reality’.
Until Bitcoin has developed its own precise & original monetary terminology, then it remains as an illusion attempting to mimic the real thing and therefore will only exist in some people’s imaginations for a short time period in human history.
However I am prepared to [accept] that an expanding mass of human shared delusion (such as religion) may take off in bitcoin’s direction and thus the crypto-conception may just last awhile longer.Or let’s put this another way…what are you bitcoiners gonna do when the next great solar flare event (Carrington event 1859…regular events that happen @ every 150 years) takes out the entire global electrical grid and the satellite system?
Rebuilding infrastructure will take years, that’s if ‘civilisation’ cooperates to rebuild it and the trends of history shows that may be unlikely for quite some time…
One of bitcoin’s innate qualities is that it forces philosophical questions about the nature of money and what “value” really is. I am certainly guilty of using terms like “miners” and “minting” in my description of bitcoin – it makes it easier to explain the unique process taking place if you compare it to an existing and already understood process.
But if bitcoin really does want to forge its own future, it’ll need its own lingo (or at least, I’ll need a new way of describing how it works). The adoption of that lingo in the mainstream press would be a great indicator of the asset’s maturity, were it to occur.
As for what bitcoiners will do in the event a solar flare takes out the grid and satellite GPS, I think they’ll be in trouble – just like everyone with their money in a bank account…
But that’s all from me for now. The next letter I write to you, I’ll (hopefully) be in Aberdeen.
In the meantime – keep warm, and drink in that Christmas spirit.
Wishing you a good weekend,
Boaz Shoshan
Editor, Capital & Conflict
Category: Investing in Bitcoin