"The president is so focused on fighting to bring down costs for hard working Americans. For instance, the president believes it just isn't right that prescription drugs are practically unaffordable for many Americans, and that's why he's fighting to lower health care costs. He got great legislation to cap insulin costs for seniors at $35 a month."

— Lael Brainard, National Economic Council Director

The government needs to show that it is fighting inflation but to do so, and to do it honestly, the government would need to admit that they are the cause of inflation. That the gravy train that is the federal budget is the cause of inflation.

And they won't do that. So they pretend to fight inflation.

Pretending to fight inflation

Ms. Brainard, the top economic advisor to the Biden administration, recently gave an interview to NPR that can be summarized as "We are posturing that we're fixing the economy even though we are not and we can't believe that people are not falling for it".

The government needs to show that they're doing something but they don't really want to reduce the debt and the current spending, actions that would actually reduce inflation, because that would put their re-election at risk.

So instead they take token actions around insulin for medicare and fees by airlines or banks.

What do these industries have in common? They are highly regulated.
What do they don't have in common? They cause inflation.

These actions will never have a major impact on inflation. Unless they "gerrymander" the inflation basket items even more and make these three items the key items that supposedly Americans are buying every month.

Actually fighting inflation

The Federal Reserve is not stupid. They know that the money supply, all the money printing to buy things we can't afford, is what is causing inflation.

Since August 2022, the Federal Reserve has quietly tried to reduce inflation for real by reducing the money supply but in April of this year they reversed course and started adding more money again in the economy.

Who asked the Federal Reserve to add more money to the economy? The answer is obvious: the Biden administration.

The governments don't want to fight inflation because that will require sacrifices. It will require admitting that we maxed the credit cards and that now we need to tighten our belts to pay them off. How many politicians in power do you know who are ready to say so openly?

You will only hear this message from politicians who are running for office: I've only heard this message from Vivek Ramaswamy (republican) and Robert Kennedy Jr. (independent).

Notable notes

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Recommendations

Preston Pysh

Preston Pysh is an investor and Bitcoin educator. You can listen to his podcasts at The Investor's Podcast Network.

You can follow him here.

What did you think of today's newsletter?

Your feedback helps me create the best newsletter possible for you.

Please leave a comment and checkout comments from other subscribers and readers. I love hearing from the Bitcoin For Families community ❤️ 🙏🏻

See you again next week!
— Alejandro

This newsletter is for educational purposes. It does not represent financial advice. Do your own research before buying Bitcoin.

"It is truly heartbreaking to see people in pain, not understanding why everything keeps getting more expensive… not understanding why, no matter how hard they work, they can never seem to get ahead… not understanding why $100 can fill their fridge one year, and barely buy a couple days worth of food the next…"

— Walker

Welcome to the latest issue of the Bitcoin For Families newsletter. This issue is a wake up call for all who are struggling to make ends meet and don't know why.

Do you know anyone who doesn't understand why he/she can't move forward no matter what? Do them a favor and forward them this article.

The last two weeks have featured many posts on Nostr with videos of people who are desperate; they work hard and yet can barely make ends meet between rent, bills and groceries. Like Walker said, their desperation is heartbreaking and what's even more heartbreaking for me is the fact that they don't understand why.

The fiat experiment that we're living in has turned out to be the biggest transfer of wealth from the low and middle class to the upper class and this same upper class has very cleverly managed to hide it from everyone, blaming this human disaster on anything and everything else except the real culprit.

How do they get away with it? Why is it that most people do not know who is causing their financial misfortune and how?

It's the inflation, stupid

Inflation is the reason why everything is so expensive.

One of my first articles on the Bitcoin for Families newsletter explains how inflation works, why housing is so expensive and why consumer prices only have skyrocketed now.

Check it out to understand why, no matter how hard you try, you can't save for a house, can't afford the rent and things getting more and more expensive.

It's the politicians that keep printing money out of thin air to pay for things that we can't afford.

It all started with Nixon lying

"Your dollar will be worth just as much tomorrow as it is today."
— Richard Nixon, 1971

On August 15, 1971 Nixon announced to the American people that he was temporarily suspending the dollar convertibility to gold, effectively starting the experiment of a fiat economy. During his speech, he promised Americans that your dollar will be worth just as much tomorrow as it is today.

Since then, and according to the official figures of the Federal Reserve, the US dollar has lost 87% of its value. One dollar on August 1971 is now worth 13 cents.

Have salaries gone up 87% since? Nooooooooo! But the rich people have gotten richer thanks to the constant printing of money out of thin air.

Nixon sacrificed the future savings of Americans to continue paying for the Vietnam War.

And all presidents since have kept robbing you.

ALL OF THEM.

The media hides the truth

Imagine if, that night, Nixon had announced that we're going to start a new national economy rooted on trusting that the politicians will do the right thing at all times when it comes to how much new money to insert into the economy.

Everyone would had immediately said thanks but no, thanks.

The media is not dumb. It was not dumb then and it is not dumb now. They could have easily called Nixon out. But they didn't. And they continue to hide the truth from the people.

Why? Because the media is owned by the very same people who benefit from the wealth transfer that the fiat economy represents.

Below is a chart from the fantastic website https://wtfhappenedin1971.com/ that shows the extent of the wealth transfer.

Politicians love hating the 1 percenters and constantly talk about how they will end the income inequality, but they NEVER tell you why it is happening. Why is that?

They don't want you to know. That's why inflation is not taught at school. That's why the concept of money, and how it works, is not taught at school.

And that is why the media tries very hard to blame inflation on anything else but the real culprits:

https://www.theguardian.com/commentisfree/2021/nov/11/us-inflation-market-power-america-antitrust-robert-reich

https://www.cnn.com/2022/02/24/business/inflation-russia-ukraine-explainer/index.html

This article on CNN takes the crown: inflation is actually good for you 👏👏👏
https://www.cnn.com/2021/12/01/economy/inflation-good-bad-winners-losers/index.html

Educate yourself about inflation

This speech by Nobel Laureate Milton Friedman explains inflation in a very accessible way. He even predicts the headlines that I pointed out above.

Learn Bitcoin

Now you know what is pushing you down. It's the politicians that keep printing money out of thin air to pay for things that we can't afford.

What can you do? How do you protect your savings? The answer is Bitcoin.

You can start learning about Bitcoin.

Go to my archive of newsletters: https://newsletter.bitcoinforfamilies.com.
And here are some interesting books to check out:

And to continuously learn more about Bitcoin, join Nostr and follow some Bitcoiners there.

Here is a note to get you started:

nostr:note1k4vplcen8cp4eymhrmyqd098n38gpyx3p386hh436u29d245dpfs7lqfgg

Notable notes

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Recommendations

Walker

Walker is a brilliant educator and the creator of the Nostrich logo for Nostr.

You can follow him here.

Bitcoin Breakdown

Bitcoin Breakdown gives you the TLDR summaries of the biggest events in Bitcoin. It's a very effective way to stay up to date with the industry.

Check it out here.

What did you think of today's newsletter?

Your feedback helps me create the best newsletter possible for you.

Please leave a comment and checkout comments from other subscribers and readers. I love hearing from the Bitcoin For Families community ❤️ 🙏🏻

Buy Bitcoin with Swan

If you want to buy Bitcoin, I highly recommend using Swan. It's where I buy my Bitcoin.

They are on a mission to onboard 10 million bitcoiners and get them to self-custody.

Use this link to receive $10 free to get you started.

See you again next week!
— Alejandro

This newsletter is for educational purposes. It does not represent financial advice. Do your own research before buying Bitcoin.

Inflation is always and everywhere a monetary phenomenon.

— Milton Friedman, Nobel Laureate

Welcome to the latest issue of the Bitcoin For Families newsletter. This issue will explain how the arguments given by Central Banks to blame others for inflation are bogus:

• 💡 Businesses are not the cause for inflation
• 🐦 Notable Notes
• 📝 Recommendations

Businesses are not the cause of inflation

Central Banks, and particularly the European Central Bank (ECB), have spent the last few weeks blaming others for inflation.

Central Banks cause inflation but they won’t accept the blame because doing so would endanger their ability to print money at will.

A week ago, the ECB Podcast released this video blaming business for inflation because they are i) raising wages; and ii) increasing their profits.

Wage increases

A business will pay you as much as they need to in order to keep you as an employee, and not one penny more.

A business will only raise wages when employees demand it because of a shortage of certain skills: for example developers in the AI space are in high demand now and can command salary raises.

The situation that we’re facing now is one where people are demanding salary raises because inflation has raised their cost of living and no one likes to be poorer that the day before.

And if my employer doesn’t raise my salary significantly but the one across the street is smart and offers to do so, then I will walk across the street to get that salary raise.

Many Europeans, with their strong unions, don’t even need a smart potential employer across the street. The unions will negotiate the salary raises for them.

It’s very straight forward: inflation came first, and as a result, wages are going up. But companies will not raise your salary above the inflation rate. At most they will match it.

In the best case scenario where your salary increase matches the price increase caused by inflation, then you continue to buy the same amount of things at the new price level. The prices won’t continue to go up. You’re just trying to maintain your standard of living.

But Europe is far from the best case scenario. The reality is that salaries increases are below inflation. Eurostat, the official office of statistics of the European Union reports that for 2022 wages increased by 4.4% (source) and inflation increased by 9.2% (source).

Blaming inflation on salary wages is a double insult. First they insult you by not accepting their responsibility for causing the inflation and then the insult you by blaming you for inflation, when all you’re trying to do is to maintain the same standard of living for your family.

Greedflation

A business will charge you as much as it can in order to keep you as a customer, and not one penny less.

It is very likely that some companies have increased their prices more than the increased cost of energy, materials and labor.

When you’re running a business that is facing inflation and you don’t know how much inflation will grow, you will, if you can, increase your prices higher than the current inflation to prepare for further increases in inflation. It’s easier than increasing the price a second time because the first time you didn’t get it right.

However, this is always going to be controlled by supply and demand. If you raise the prices too much, people will stop buying your goods.

Again, inflation comes first. Price increases come second. And if you increase the price too much, the competition will undercut you and you will need to lower the price to maintain the customer.

Blaming inflation on greedy businesses is a diversion so that you focus on the evil business man instead of focusing on the really evil central banker.

Agustin Carstens, Head of the Bank of International Settlements

Climate change

Climate change affects inflation

— Christine Lagarde, President of the European Central Bank

This is so funny that I had to include it here as a bonus.

How exactly does that work? I can see how an extreme weather event could cause a temporary increase in prices for certain items but not real, core inflation.

For example, let’s say that an unusual cold weather patch in the midwest of the United States decimates the wheat crops days before the harvest. Now there is less wheat available for the same expected worldwide demand and the price of wheat globally goes up.

People respond to prices of wheat going up by buying less bread or flour and, as a result of the lower demand, the prices go down until they find a new equilibrium. This is not inflation. This is the market working as intended. The price of wheat is signaling the lower supply. That is the purpose of money: to convey information about the value of an item and this value, off course, is impacted among other things by the combination of supply and demand.

But a temporary increase in prices is not what we’re experiencing. We’re experiencing systemic inflation.

Blaming inflation on climate change is an attempt to cast inflation as an unpredictable calamity that no one is really responsible for.

According to Ms. Lagarde, inflation came out nowhere. And it’s Putin’s fault.

The real cause of inflation: too much money

Price inflation happens when more money chases the same amount of goods and services.

We all know it at the basic level: too much money printing devalues the currency and therefore prices must go up because the value of a kilo of apples doesn’t change, what has changed is the value of the euro.

The ECB knows it as well. But they won’t say it aloud. Check the chart below with the Euro money supply. Growing well above the GDP until very recently when they started scaling back.

Euro money supply (millions of Euros)

Watch this fantastic speed by Milton Friedman for a clear and simple explanation of inflation. He even predicted today’s deflection tactics by the ECB!

Notable notes

Recommendations

Lyn Alden

Lyn Alden is a fantastic macro analyst with a gift for distilling complex data sets into simple to understand concepts.

Here is the February 2023 newsletter with her fantastic analysis, in this case focused on inflation.

She is a strong believer in Bitcoin and you can follow her here.

Bitcoin Therapy 🧠

Level up your Bitcoin knowledge in 3 minutes...every Sunday.

Subscribe here.

What did you think of today's newsletter?

Your feedback helps me create the best newsletter possible for you.

Please leave a comment and checkout comments from other subscribers and readers. I love hearing from the Bitcoin For Families community ❤️ 🙏🏻

Buy Bitcoin with Swan

If you want to buy Bitcoin, I highly recommend using Swan. They are a Bitcoin only business that is focused on self-custody and educating their users. It's where I buy my Bitcoin. Use this link to receive $10 free to get you started.

See you again next week!
— Alejandro

This newsletter is for educational purposes. It does not represent financial advice. Do your own research before buying Bitcoin.