Macro Musings with David Beckworth George Selgin on Strategic Bitcoin Reserves, Debanking, and the Fed’s Framework Review
8 snips
Dec 23, 2024 
George Selgin, a senior fellow at the Cato Institute, dives into the controversial terrain of strategic Bitcoin reserves and their potential implications for U.S. monetary policy. He critiques government involvement in Bitcoin, exploring its evolving status as an alternative to traditional currencies. Selgin also addresses the rising issues of debanking, linking them to macroeconomic factors, and advocates for a reformed regulatory environment. Additionally, he discusses the Fed's framework review and the potential benefits of adopting nominal GDP targeting for more effective economic stability.
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Strategic Bitcoin Reserve Proposals
- Bitcoiners and politicians propose a U.S. strategic Bitcoin reserve.
- These proposals draw flawed analogies to strategic commodities, sovereign wealth funds, and international reserve assets.
Bitcoin as Dollar Support?
- Proponents argue Bitcoin, like gold, strengthens the dollar by diversifying reserves.
- This ignores that the U.S. doesn't need reserves like other countries.
Why the U.S. Doesn't Need Reserves
- Other countries hold foreign exchange and gold reserves to manage exchange rates.
- The U.S., as the reserve currency issuer, doesn't need these reserves.
