#AES #Bitcoin §43 Debt Supercycle Implosions The debt supercycle is a recurring pattern: • Debt builds, • The velocity of value slows, • Money dies, malaise, • Eventually, the pitchforks come out, • War, guillotines, and debts are destroyed, and • A new power establishes or resets with a new ledger. Which ledger will replace the petrodollar? Can it be different this time? A transition without violence? Perhaps peaceful Bitcoin will emerge instead of another top-down artificial fiat.

#AES #Bitcoin §42 Fault Isolation This is a method of detection by isolation. Failure to isolate an electrical fault may require replacing multiple systems. With a monetary system, fiat is an electrical short or a hydraulic leak. Bitcoin is ideal. A closed system of twenty-one million. Value flows without loss. Without inflation. Bitcoin follows the Law of Conservation. Fiat does not. Fiat is designed to debase. Designed to leak. Fiat is not ideal money.

#AES #Bitcoin §41 Electrical Shorts Are Bad The first law of thermodynamics is a universal law and can be applied to a closed system. Energy is converted from one form to another, but it cannot be created or destroyed. An application of the Law of Conservation can be observed with a hydroelectric power plant. Water flows downward onto a turbine. This, in turn, rotates the turbine and generates electricity. The electric circuit is a continuous path from the energy source to the load. The electric circuit is a loop. A short circuit may cause a fire, electrical burn, or electrocution. Fixing a short circuit is not easy. Fault isolation is one method.

#AES #Bitcoin §40 Hydraulic Leaks Are Bad With a leak, the hydraulic system is broken. The pump will work to compensate for the loss. As the leak grows bigger, the pump must compensate more and more. The system grows more fragile until it doesn’t work. Hydraulic leaks are bad. For the conservation of energy to work, the energy system must be closed.

#AES #Bitcoin §39 The Ring That Binds Them All The magic money printer binds them all. The fiat oligarchy gets richer. Everyone else gets inflation. The Fed can print infinitum, and the other fiats around the world are debasing faster than the U.S. Dollar.

#AES #Bitcoin §38 OUR BROKEN MONETARY SYSTEM The fiat oligarchy gets richer. Everyone else gets inflation. Slavery is a win-lose scenario. In the long run, with slavery and inflation, everyone loses. In a commodity-based monetary system, transactions are win-win. In the long run, everyone wins.

#AES #Bitcoin §37 Crypto is a Scam, Fiat Inflation Is Theft Unlike crypto, Bitcoin is not a security. No liability attached. By definition, a security has a liability attached to it. The U.S. dollar has liability to the U.S. government…meaning the U.S. can debase it. Bitcoin cannot be debased. Less than twenty-one million units, forever. Bitcoin is owning a “bearer asset,” and a bearer asset means you hold it. Commodities, such as gold, fit into this asset class. Commodities do not have liabilities. Bitcoin is a commodity. The scarcest commodity ever created. After the 2024 halving, Bitcoin will be scarcer than gold. Fiat is not a commodity. Crypto is not a commodity. This is why fiat and crypto are close cousins.

#AES #Bitcoin §35 Demonetizing Gold, but Not Bitcoin After World War II, the Bretton Woods Agreement would return to an honest ledger. The U.S. dollar was pegged to gold. Then, Richard Nixon decoupled the U.S. dollar from the gold peg. The U.S. dollar departed from a commodity-based monetary system. Since 1971, the U.S. dollar has been fiat, and gold is increasingly demonetized with unnecessary friction. Now, cash is being demonetized with Know Your Customer (KYC) and Anti-Money Laundering (AML). Fiat is easiest to debase for the purpose of creating artificially low fiat interest rates. Artificially low interest rates displace commodity-based monetary systems.

#AES #Bitcoin §34 Bitcoin – The First Decentralized Digital Ledger No double-entry. No economically meaningless swaps obfuscating value, fraud, embezzlement, counterfeiting, or grand-theft inflation. No intermediary needed. No central bank.

#AES #Bitcoin §33 Triple-Entry Ledger In 2005, Ian Grigg wrote about triple-entry accounting. It was a digital transformation of the paper-centric, double-entry method. With Grigg’s method, the cryptographic signed transaction. Grigg coined the term…a pair of double-entries connected by the central record: triple-entry. Note: this is not Bitcoin.

#AES #Bitcoin §32 Double-Entry Ledger During the 14th century, merchants in Venice and other Italian merchant cities developed a double-entry accounting method. Instead of exchanging gold for goods, merchants would orally describe the transaction to a scribe while the gold remained at a safe location. The debits were on the left half of the page, and the credits were on the right half of the same page. Each transaction recorded both sides of a transaction, so the total of one side had to equal the total of the other side. Traceability helped improve the accuracy of the records.

#AES #Bitcoin §31 Single-Entry Ledger: Cuneiform Cuneiform is a method of writing once used in the ancient Middle East. The wedge-shaped stylus was pushed into a soft clay tablet and dried, perhaps in the sun. The clay tablet created an immutable record. Cuneiform is the oldest form of writing in the world, appearing earlier than Egyptian hieroglyphics and lasting about three thousand years.

#AES #Bitcoin §30 Perceptual Value and Social Credits Perceptual value existed before value became descriptive, objective, or academic. Before money, people naturally kept track of favors and insults. Dogs, cows, and crows also keep a social ledger.

#AES #Bitcoin §29 MONEY LEDGER EVOLUTION What is money? What is value? What is quality? Let’s go back in time.

#AES #Bitcoin §28 Onshore Engineering and Manufacturing Adam Smith described this in detail. Financialization is the reason why engineering and manufacturing continue to offshore to other countries and only onshore with heavy subsidies. It’s exactly what Adam Smith described in The Wealth of Nations. Monopolies distort price signals for the worst. Good for the mercantilist. Bad for everyone else.

#AES #Bitcoin §27 Free Market Signals and Fiat Drift With fiat, artificially low interest rates for the fiat oligarchy distort and cause financial signals to drift. Eventually, assets will go parabolic. Melt up. On the surface, this doesn’t seem rational. But it is reasonable when you know fiat is 100% guaranteed to debase. When the credit risk gets too high, a melt-up will happen. It’s already started.

#AES #Bitcoin §26 Definancialize, Demonetize Real Estate and Fix Homelessness Zero-tax Bitcoin is our best hope for a commodity-based monetary system…. A commodity-based monetary system is our only hope to definancialize and demonetize housing and reverse growing homelessness.

#AES #Bitcoin §25 Problems with a Financialized Economy Back in the day, the Mississippi bubble was one of the biggest asset bubbles known to the modern world. This bubble led France into prosperity. Then, the same bubble caused the opposite to happen, leaving France bankrupt and insolvent. Worse off than when John Law started rehypothecating debt-based assets, co-mingled and obfuscating private-public accounting. Bank failures are not new. It’s the same scam over and over.

#AES #Bitcoin §24 Bitcoin Transforms a Centralized Economy into a Free Market We need to lean up. Our subsidized feudal systems will scream bloody murder. Let them scream. We need to get in shape. Zero-tax Bitcoin. Zero-tax gold. Zero-tax copper. Zero-tax aluminum. Zero-tax lithium, and other renewables.

§23 #AES #Bitcoin 1971 AUG 15: U.S. Defaults and the U.S. Dollar Transforms into Fiat Currency. Debt obligations issued by the U.S. Department of the Treasury (bonds, notes, and Treasury bills) are considered risk-free because the U.S. government backs them…with more money printing.