Part 13/16:
Bonds’ Diminished Appeal: With the U.S. government spending more than it earns ($46k income vs. $65k expenses), debt levels balloon, interest payments soaring.
Fed’s Role: The Fed mostly buys its own bonds—creating a “death spiral”—where more debt issuance leads to further monetary debasement.
Market Dysfunction: Recent treasury auctions saw record low demand from foreign central banks and indirect bidders, risking a failure in the bond market.
Implication: The ‘house-of-cards’ nature of the Treasury market favors alternative stores of value like Bitcoin.
Cryptocurrency alternative: Bitcoin’s scarcity and independence from fiat central banks are increasingly viewed as hedge instruments against systemic debt and monetary debasement.