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How short-term Bitcoin shackles and insufficient effective demand have changed history?

The latest news from MicroStrategy, a well-known big Bitcoin player, is that it recently purchased 7002 Bitcoins again with about 414.4 million U.S. dollars in cash, with an average unit price of 59,187 U.S. dollars. The latest statistics are that it currently owns 121,044 bitcoins with a current value of US$3.57 billion, and its average price is US$29,534 per bitcoin. It is very profitable. The profit has doubled and is not yet satisfied. The latest bitcoin purchase is still at a slight loss. Of course, the vast profit is also an important reason it dares to continue buying at the current price. Anyway, its average cost is still meager.

From the perspective of Bitcoin-related bargaining chips, long-term, extensive customer holdings are still rising. These buying powers block too much downside space, but another fact is undoubted that this power is not the market price promoter. They will buy long-term hoarded coins at low prices when the market drops and push up the price to create the market. Strictly speaking, they are similar to Bitcoin miners. Part of the bargaining chip is waiting for high prices. Instead of pushing up prices, they have confidence in the future of Bitcoin.

From the perspective of the short-term effective demand of Bitcoin, effective demand determines the upper limit of most economic affairs. It fundamentally changes and changes the global political and economic development trend.

Looking back at international history, we can find a rule that effective demand determines the upper limit of the economy. In contrast, the cost structure determines the lower limit of the economy. The interaction of the two promotes changes in various countries’ economic and political systems.

We know that observing the development of modern economic history, we can start from the Great Depression of 1929. The cause of the Great Depression is summarized as the overcapacity caused by insufficient effective demand. That is, people with the consumption power in the society have already bought a lot. But there is no increase in effective demand for those who can’t afford it all the time, but the productivity is still expanding, and the surplus crisis will break out. If you look at it from a national and global scale, you will find it absurd because most of the population has a tremendous actual demand, but it cannot form effective demand. This is a structural problem. Due to the polarization between the rich and the poor, the national government cannot meet the demand transform into effective demand.

At that time, the guiding ideology in the economy of Europe and America was Keynesianism. From a historical point of view, Keynesianism is not a substitute for structural reforms. It only expands effective demand within a specific range by expanding government expenditures and rapidly increases government debt by expanding government expenditures.

But to compete with Soviet socialism, Keynesianism could not ebb after World War II, but the focus was shifted to social welfare to win the people’s hearts. In the era of big industry, workers are the most organized. Will the Soviets, thought of brainwashing them if they don’t please them? Therefore, high debt levels must also maintain high welfare and high wages. This is actually to maintain high effective demand for debt forcibly, so there will be stagflation in the 1970s and 1980s-the end of the golden age. Still, it is forced to maintain to compete with the Soviet Union. Fortunately, capitalism is finally waiting for the weakness of the Soviet Union.

With the decline of the Soviet Union, this reversal is even more unstoppable. The primary method of capitalists is two tricks. The first is de-industrialization. Organized workers are scattered among various unorganized service industries, and the bottom layer is unlikely to form threatening opposition forces. The second is that financial capitalism replaces industrial capitalism because industrial capital plundering is terminated by nuclear deterrence. The alternative plundering method is financial capitalism, plundering through financial means to reduce the cost structure, in disguised form, to increase effective demand. Since then, the currency has become an essential weapon.

Regarding the current international political and economic structure dominated by the United States from the perspective of effective demand, everyone can figure it out. The point is that each country’s various policy behaviors and forces are often used to change or increase effective demand. This kind of centralized “make a difference” behavior sometimes brings benefits, sometimes bad things. But, in turn, a decentralized currency like Bitcoin is essentially lying flat, waiting for the miracle of time.

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