This week, news broke that the Producer Price Index – which measures the average change over time in the selling prices received by domestic producers for their output – rose 9.7% in 2021. This was a shocking realization for many. We’re near 10% wholesale inflation!
This is important because it’s what’s driving a lot of bitcoin buyers. The impact that near-10% inflation has on an economy is massive.
It erodes people’s savings and bonds. Wages don’t keep up. And it pushes people into higher tax brackets, raising their overall tax burden.
It also erodes debt levels, which would make our very high debt-to-GDP ratio of 130% shrink. (So that’s kind of a good thing.)
And it’s likely to continue driving adoption of bitcoin and altcoins.
I think crypto may have bottomed, but anything could happen. Over the longer term, though, we go higher.