CRYPTO COLLAPSE — BITCOIN SMASHED BY THE CHINA CENTRAL BANK — EUROPEAN CENTRAL BANK ISSUES WARNING — VACCINE DEATHS AND REACTIONS IN THE UK — BLINDNESS AFTER VACCINATION — CASES RISE AFTER VACCINATION

BOOM FINANCE AND ECONOMICS

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THIS WEEK’S EDITORIAL

CRYPTO COLLAPSE

Last Wednesday, the prices of almost all the Crypto’s collapsed. Some people call these “crypto-currencies” but BOOM prefers to call them “speculative digital assets of no intrinsic value”.  Another way to describe them is “some binary code in a data packet” — in other words, no different to an email. 

On Wednesday, Bitcoin hit a Low around $ 32,000.  It was $ 64,671 on 14th April.  So it had fallen by over 50 % in 5 weeks. If that rate of fall was to continue, it would be $ 2,000 by mid October. Sobering.

The US Dollar responded by rising sharply as institutional investors fled the Crypto world and headed back to the fiat world, shedding Cryptos and then moving rapidly from Stablecoins to the safe haven of US Dollars. The US Dollar stablecoin, Tether, suffered massive demand that began on Tuesday at around 2.45 PM. That continued until about 4.25 PM on Wednesday. Then the demand for Tether suddenly collapsed as the Tethers were swapped out by holders either for US Dollars or (for the true believers) to head back to Bitcoin.

The demand for Tether then resurged from Thursday 20th May onwards until now (Sunday). That is probably a negative sign for the Bitcoin price going forward. Sellers again appear to be moving out of Bitcoin and towards the Tether as a safe haven. BOOM expects further declines in Bitcoin price until these price dynamics settle down. In these volatile market conditions when Bitcoin is falling in a price downtrend, the demand for Tether rules the roost. Tether and other stablecoins are where holders of Crypto go to rest and watch the game from the sideline. If they get really scared, they head back to fiat US Dollars — FAST. The game is played 24 hours a day, 365 days of the year. Most Crypto exchanges are not regulated in any significant way. It is the wild, wild west.

BITCOIN SMASHED BY THE CHINA CENTRAL BANK

On 25th April, 4 weeks ago, BOOM wrote this —

As far as BOOM can tell, the Chinese government has not yet attacked the Bitcoin phenomenon as vigorously as perhaps they might. However, surely they will soon realize that Bitcoin and the Cryptos simply serve the purposes of the United States US Dollar empire?

BOOM expects China to wake up very soon and stop Bitcoin mining inside their borders forcefully. They should also follow Turkey and ban the use of Bitcoin and Cryptos as payment settlement for any goods and services. Watch for the Chinese government to take firm action in this regard either next week or within the next month
.”

Last week, the People’s Bank of China warned against the use of Bitcoin and other Cryptos in payments. They said that they are not real currencies and they issued a warning about speculation in virtual currencies. They also said that financial and payment institutions are banned from pricing or conducting business in so-called “virtual currencies”. At the end of the week, China’s State Council again warned against Bitcoin mining and trading.

EUROPEAN CENTRAL BANK ISSUES WARNING

Two weeks ago, BOOM alerted readers to the warning fom the Federal Reserve in Washington DC that asset prices were too high. In its Financial Stability Report, the Fed had warned that “a broad range of asset prices could be vulnerable to large and sudden declines, which can lead to broader stress to the financial system.”

Well, surprise, surprise. Last week, the European Central Bank also issued a warning in its Financial Stability Review. It used the word “exuberance” 8 times and it said “spillovers from U.S. equity market repricing could be substantial”.

It went on to say ” the pandemic will leave a legacy of higher debt and weaker balance sheets, which — if unaddressed — could prompt sharp market corrections and financial stress or lead to a prolonged period of weak economic recovery.”

And “An increase in corporate insolvencies may impact households via employment prospects”.
Readers should always take note when major Central Banks issue warnings. They do not do so lightly. You can bet against them but it may be like trying to hold back a Tsunami.

VACCINE DEATHS AND REACTIONS IN THE UK

The latest statistics from the United Kingdom (the UK) on Adverse Reactions to the new Covid Vaccines make for sober reading. The vast majority of vaccinations have been with the Astra Zeneca and Pfizer/Biotech vaccines.

1,180 deaths have been reported soon after Covid vaccination in the UK. And 822,845 other adverse events have been reported. The number of people reporting adverse events amount to 235,223 so some report more than one adverse event. In fact, the average adverse events on a per person basis number about 3.5.

Keep in mind that many experts estimate that only 1 % – 10 % of adverse reactions are actually being reported to the Yellow Card System. That means that the adverse events in reality may be as high as 8 Million – 80 Million. We just don’t know what is really happening. We are flying blind.

BLINDNESS AFTER VACCINATION —

These reports have been received from patients and doctors in the UK

Pfizer Biontech —  Total Blindness 34, Visual Impairment 139, Eye Disorders in Total 390
Astra Zeneca     — Total Blindness 176, Visual Impairment 474, Eye Disorders in Total 9996
Moderna          —  Total Blindness 1, Visual Impairment 1, Eye Disorders in Total 48
Unspecified      —  Total Blindness 1, Visual Impairment 2, Eye Disorders in Total 31

Quote:  “This safety update report is based on detailed analysis of data up to 12 May 2021. At this date, an estimated 11.7 million first doses of the Pfizer/BioNTech vaccine and 23.9 million first doses of the COVID-19 Vaccine AstraZeneca had been administered, and around 9.9 million and 9.0 million second doses of the Pfizer/BioNTech vaccine and COVID-19 Vaccine AstraZeneca respectively. An approximate 0.2 million first doses of the COVID-19 Vaccine Moderna have also now been administered.” Unquote

Here is the link FOR ALL 4 VACCINES IN THE  UK — check for yourself. Stay seated.

Link:  https://www.gov.uk/government/publications/coronavirus-covid-19-vaccine-adverse-reactions/coronavirus-vaccine-summary-of-yellow-card-reporting#annex-1-vaccine-analysis-print

Scroll down to Vaccine Analysis Print — the links for the PDF files for all of the UK vaccines are there. You can search through the huge lists of adverse events for each vaccine there.

Here is an up-to-date summary of deaths and adverse events from Covid Vaccines currently reported in Government Statistics from Covid Vaccines in the UK, the USA and Europe. Such numbers are unprecedented in vaccine history.

UK —        Deaths 1,180  Injuries  822,845
USA —      Deaths 4,057  Injuries 229,270
Europe — Deaths 11,529  Injuries 1,105,602

Total Deaths 16,766
Total Injuries 2,157,717

Keep in mind that many experts estimate that only 1 % – 10 % of adverse reactions are actually being reported.

Of course, it must be stated that all of these reported deaths and adverse reactions may not be related to the Covid Vaccines. They may all be just a coincidence. Some people refer to this type of phenomenon as a Coincidence Theory.

CASES RISE AFTER VACCINATION

Taiwan has 25 Million people crowded together on a small island and yet it has recorded only 17 deaths attributed to Covid in 15 months. Covid Vaccines arrived in Taiwan in early March this year. Soon afterwards, vaccinations began in earnest and now Covid “cases” are skyrocketing (Positive PCR Results). Now that is odd, isn’t it? 

MMMmmmmmmmmmmm ……..just another coincidence?  Check out the numbers for yourself at the link.

Link:  https://www.worldometers.info/coronavirus/country/taiwan/

In economics, things work until they don’t. Until next week …………  Make your own conclusions, do your own research.  BOOM does not offer investment advice.

CLICK HERE FOR PODCASTS:   OUR BRAVE NEW ECONOMIC WORLD

EMAIL: gerry {at} boomfinanceandeconomics.com

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HOW MOST MONEY IS CREATED

BANKS CREATE FRESH NEW MONEY OUT OF THIN AIR (but they always need a Borrower to do so)THERE IS NO SUCH THING AS A DEPOSIT
BANKS PURCHASE SECURITIES, THEY DON’T MAKE LOANS
BANKS DON’T TAKE DEPOSITS, THEY BORROW YOUR MONEY

Watch this short 15 minutes video and learn as Professor Richard Werner brilliantly explains how the banking system and financial sector really work. 

https://www.youtube.com/watch?v=EC0G7pY4wREhttp://
How is Most New Money Created ?

LOANS CREATE DEPOSITS — that is how almost all new money is created in the economy (by commercial banks making loans).

From the Bank of England Quarterly Bulletin Q1 2014    —
“Whenever a bank makes a loan, it simultaneously creates a matching deposit in the borrower’s bank account, thereby creating new money.

“Most money in the modern economy is in the form of bank deposits, which are created by commercial banks themselves”.

Youtube Video —  https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/money-in-the-modern-economy-an-introduction

and

https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/money-creation-in-the-modern-economy

Paper:  Money in the Modern Economy  PDF —  CLICK HERE

Quarterly Bulletins Index

http://www.bankofengland.co.uk/publications/Pages/quarterlybulletin/2014/qb14q1.aspx

Most economists are unaware of this and even ignore the banking & finance sectors in their econometric models.

On 25th April 2017, the central bank of Germany, the Bundesbank, released a statement on this matter —

“In terms of volume, the majority of the money supply is made up of book money, which is created through transactions between banks and domestic customers. Sight deposits are an example of book money: sight deposits are created when a bank settles transactions with a customer, ie it grants a credit, say, or purchases an asset and credits the corresponding amount to the customer’s bank account in return. This means that banks can create book money just by making an accounting entry: according to the Bundesbank’s economists, “this refutes a popular misconception that banks act simply as intermediaries at the time of lending – i.e. that banks can only grant credit using funds placed with them previously as deposits by other customers”. By the same token, excess central bank reserves are not a necessary precondition for a bank to grant credit (and thus create money).”

Reference: https://www.bundesbank.de/Redaktion/EN/Topics/2017/2017_04_25_how_money_is_created.html

The Reserve Bank of Australia (Australia’s central bank) has also contributed to the issue in a speech by Christopher Kent, the Assistant Governor on September 19th 2018.

“…… the vast bulk of broad money consists of bank deposits”
“Money can be created …….. when financial intermediaries make loans
“In the first instance, the process of money creation requires a willing borrower.” 
“It’s also worth emphasizing that the process of money creation is not the result of the actions of any single bank – rather, the banking system as a whole acts to create money.”

Disclaimer:   All content is presented for educational and/or entertainment purposes only. Under no circumstances should it be mistaken for professional investment advice, nor is it at all intended to be taken as such. The commentary and other contents simply reflect the opinion of the authors alone on the current and future status of the markets and various economies. It is subject to error and change without notice.The presence of a link to a website does not indicate approval or endorsement of that web site or any services, products, or opinions that may be offered by them.

Neither the information nor any opinion expressed constitutes a solicitation to buy or sell any securities nor investments. Do NOT ever purchase any security or investment without doing your own and sufficient research.  Neither BOOM Finance and Economics.com nor any of its principals or contributors are under any obligation to update or keep current the information contained herein. The principals and related parties may at times have positions in the securities or investments referred to and may make purchases or sales of these securities and investments while this site is live. The analysis contained is based on both technical and fundamental research.

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MOLS Denmark

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