Bitcoin could become ‘worthless’, Bank of England warns

[ErMine1]

They're talking about run-of-the-mill inflation driven by wage-price spirals, and saying that's how you get an inflationary spiral. In my mind, that's not the only way. We have a fiat currency and it's value is really derived from people's faith in it's value. You can print money and encourage borrowing etc, but much like stock market bubbles, there is a tipping point in there when all the feedbacks turn from negative to positive.  Normally, you hold money, it holds it's value, there's no real push to gain or spend it. If you think inflation is going to increase, it now becomes a hot potato that you want to spend as soon as you get it. You do this by buying useful assets like houses, land, food, things you need. When everyone does this it drives up the price, which would normally dampen demand, but if the expectation that money will continue losing value and the price will only increase, then the price doesn't matter anymore. Sellers can ask arbitrarily high prices. But who's going to sell into this and accept that money? Thus supply goes down at the same time demand goes up, further exacerbating the situation.  The government has been pumping new money into the economy to try and stimulate it, yet velocity stays low. Who needs to spend all that money under normal circumstances? But what happens when it all starts losing value? All that "cold" money suddenly turns hot, and the *effective* money supply suddenly increases. Meanwhile, everyone is also incentivized to borrow as much as possible to "short" the currency, further increasing the supply. But who wants to lend into this? The credit market slows, and the government steps in as "lender of last resort" again....using printed money.  Meanwhile, the massive amounts of money tied up in the stock market suddenly need a new home. I mean, who wants to hold a stock when all you can get out of it is increasingly worthless money. You paper gains are impressive, but it's only a reflection of the fact your asset is losing value, because the only value it has is denominated in dollars (rather than any kind of tangible use).  I mean it goes on and on. Wage-price spirals may be a part of 'normal' inflation but they don't really play into hyperinflation.

[FireEmblemBZP]

Not if Biden keeps making policies that increase it. For example, now truckers can't bring in goods from Canada unless they've been vaccinated, and that means 20% of truckers that normally would deliver cannot. So that's going to increase the cost of goods. And Biden and his team are either too stupid to understand this, or they understand it completely and want inflation. That way when the economy fails they can take it over completely and blame capitalism.

[wordless]

The world economy is going to crash hard

[dustymole]

Yes, president Trump already started the process, but the socialist party wanted American more debts.  The corruptions official corrupted every sectors which destroys our entire nation slowly and now we are facing inflation from many decades covered ups.

[thmu2012]

Inflation need to keep you guys poor

[Killer_Chris]

ICE car manufacturers that pretend to be transitioning to electric. GM is the poster child   

[breezeway]

2% is not low inflation

[tijoeg]

Shame. The congress knows nothing more than your typical no coiners

[licentious]

Why until now you have realize that your exaggeration of outsourcing in China is the main cause of inflation. You need to generate jobs and production locally.  Too much advance thinking ha, go back to basic.

[Bartoszzzzz]

Elections have consequences..TRUMP 2024   

[FrytarPL]

The only one hurting is them because they can't buy cryptocurrency legally they are being left behind. Cyptocurrency is taking market share from traditional investments like gold and even a good share of stocks. Microstrategy just buying bitcoin at 30k not only made them billions but grew there companies market cap by quadruple .

[sparklekitty348]

The government can do nothing oil is attached to everything and we use 840 million. Gal every day just in the united states. Another 80 million barrel of oil in the rest of the world and we are running OUT

[Sher]

Thanks to I got my  credit score fixed up,and I got the check of $7k delivered yesterday,you are the best to deal with.

[apple_wanhee]

"Actually, nobody can see a bubble; that's why it's a bubble"

[marki224]

Hatchet job lol