The Podcast of the Lotus Eaters PREVIEW: Brokenomics | Labour's Doomsday Budget
Dec 2, 2025
Dive into the chaos of Labour's budget as the host critiques its tax increases. Explore the intriguing dynamics of the liquidity cycle and its global implications. Discover Bitcoin's rollercoaster journey from highs to recent dips while addressing listener concerns. Get insights on the US's Treasury hoarding and looming liquidity squeezes, along with the likely return of liquidity spurred by fiscal easing. Lastly, consider the risks of UK fiscal health compared to dollar-denominated assets, all wrapped up in a lively discussion of market strategies.
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Personal Bitcoin Call From $16k
- Dan recalls recommending buying Bitcoin around $16k that later rose significantly, illustrating conviction in long-term positions.
- He notes recent pullbacks from all-time highs as normal volatility rather than a regime change.
Liquidity Dipped But Is Likely To Return
- Liquidity tightened due to the US Treasury hoarding in the TGA and the Fed's quantitative tightening, which drained over $1tn from markets.
- As the TGA falls, QT slows and global easing resumes, liquidity should return and boost risk assets like tech and crypto.
Reopening Will Inject Fresh Liquidity
- Reopening of the US government will release hundreds of billions from the TGA and change issuance toward shorter-term paper, easing funding conditions.
- Combined moves from China, Japan and Europe create a coordinated liquidity uplift benefitting gold, tech and crypto.