The Jack Mallers Show LIVE: Leverage & Liberty - The U.S. Can't Handle Volatility & It's Good For Bitcoin
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May 6, 2025 Dive into the intriguing world of macroeconomics as Bitcoin emerges as a beacon in today's volatile financial system. Discover how the U.S. lending landscape has shifted post-2008, emphasizing the growing dependence on Treasury bonds. Explore the challenges of maintaining the dollar's status amid soaring national debt and how Bitcoin stands as a resilient alternative. Discuss the declining reliability of traditional assets and consider Bitcoin's potential to secure wealth for the middle class in an ever-changing economy.
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Bretton Woods and US Deficits
- The Bretton Woods system post-WWII made the US dollar the world reserve currency backed by gold.
- This setup forced the US to run persistent deficits, exporting dollars and importing goods.
Shift in US Debt Financing
- Post-2008, foreign holders drastically reduced buying U.S. treasuries.
- The US turned to its domestic banking system and hedge funds for debt financing instead.
Leverage Propping Treasury Market
- Hedge funds run large leveraged basis trades to support U.S. treasuries market.
- This leverage hides the lack of real buyers and poses systemic risk to financial stability.