(Newswire.net — January 8, 2015) Portland, OR — The situation is becoming so dangerous, we could suffer “a worldwide economic collapse” that would cast us into “an extended period of global anarchy.”
And some of the world’s richest investors appear to be rushing to prepare for this frightening scenario. Warren Buffett has now taken $55 billion of Berkshire Hathaway capital out of the markets. And George Soros has moved 16% of his net worth into a short position that shields him from an imminent Wall Street collapse.
Currency Wars
The cheaper Japanese yen makes imports of things like food more expensive for the ordinary Japanese consumer. But the government is in the pocket of the country’s powerful automobile and electronic manufacturers. So it serves their interest with a weak yen that makes their goods available to foreign buyers at an apparent discount.
Vietnam just devalued its currency by one percent.
Switzerland just renewed efforts to weaken their franc by buying euros.
The euro hit a nine-year low recently. And the European Central Bank is expected to weaken the currency further with a new money-printing, bond buying program.
The collapse in oil prices has changed the dynamic that drives currency wars. In a stable energy market, the cheap yen would have meant higher energy prices for Japan’s consumers, but falling oil prices have provided them a marginal bargain.
Strong Dollar
The predictable reactions against the strong dollar here in the U.S. are muted for now thanks to the apparent recovery. Domestic auto sales are booming. Lower oil prices leave consumers with more discretionary spending power.
So while competitive devaluations are being implemented elsewhere, for the time being the strong dollar is not being met with much resistance domestically.
That will change. With the dollar markedly higher, emerging markets are ring staggering under their dollar-denominated debt load. Their creditor banks, not wanting to suffer defaults, will eventually demand a cheaper dollar.
Bitcoin Better Bet
Bitcoin values have been under pressure for some time now. And in the beginning days of 2015 it dropped to some of the lowest values in over a year.
However, Bitcoin investor Marc Andreessen says that he still stands behind Bitcoin.
Andreessen believes that Bitcoin will stabilize in the long-run through a combination of economics of scale and the use of derivatives.
Something that benefits Bitcoin is its scalability and the ability to manage payments from virtually anywhere in the world. Poor banking systems in many countries around the world has cause may people to be locked out of global e-commerce. Another benefit is the constant threat of credit card fraud that has cost many companies 5-10% of sales in an effort to deal with the security problems
Andreessen is very upbeat about the innovation in the Bitcoin system believing that 2015 will show a greater adoption of Bitcoin as more consumers jump on board the Bitcoin bandwagon, as well as its technological innovation, including new form of mining contracts.
He concludes that everyone should be patient stating, “Bitcoin is still a 6-year old toddler.”
But 6 year olds do grow up…eventually.
Sources:
https://www.cryptocoinsnews.com/marc-andreessen-stand-by-bitcoin-2015
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