The Oval Office Crypto-King

 

Trump has made millions in the crypto market while the fools that invested in it have lost billions.  Trump’s own crypto coin was shilled for an IPO of $74/per.  It is now selling for around $3.  If you bought it you fell for the pitch and lost everything, including your pride.  You have been had, but even now you do not know how bad.  Why?  Because Trump and his family made themselves the brokers for this coin, which means that not only did they get rich from the initial bloated (pick me, pick me) price, they also get a cut of every consequent purchase or sale.  You bought when it was high? They got a cut.  You sold when it was dropping?  They got a cut.  You decided to cut your loses?  They got a cut.

If you are one of the crypto-crazies and among the ever-hopeful, but intellectually challenged devotees, thereof.   Here are some things that you need to know.

Crypto is nothing more than the 21st Century’s version of Amway.  They just substituted block chains for circles.  Other than that, it’s the same old schtick. 

It is a curiosity to me that people who have never taken a class in economics are sure they have a good bead on how to beat the system.  They think that people who play by the rules are suckers.  The smart people (like them—right?) use the odd hustle, play the system and earn easy money.  These are the same people who loudly sing the blues and blame others when the “con” turns out to be on them.

There is a saying among the sales community that people only buy for two reasons: need or greed.  [There are several sayings among the loosely affiliated fraternity of salesmen, and few of them reflect kindly on the consumer, but that does not mean they are not accurate.]  When it comes to the cryptocurrency market you can forget about “need” and concentrate simply on “greed.”  Usually, I treat these emerging stories of fraud and the easily duped with a yawn and an eye roll.  But the gaping flaw in crypto currency is dangerous and makes me wish that more economics was taught in our schools. 

We could at least start out teaching what money isn’t.  You can’t eat it, you can’t wear it, you can’t dose yourself with it to get well if you are sick, and you can’t create electricity with it to cool your home.   But you can use it to acquire all those things because money is a store house of value.  It takes about 14 cents to make a $20 bill, but it still represents $20 worth of purchasing power.  Put a picture of Ulysses Grant on it and it will be worth $50.  Benjamin Franklin will buy you $100 dollars.  Slap Salmon P. Chase on it and it is worth $10,000.   That power may vary with inflation or deflation, but the fact remains that what the currency’s cost of production is never close to what it can purchase. 

So, why can’t you or I put our picture on a well-decorated note, take it to the dealership and buy a new car?  Because no matter how pretty I make my pretend money, it is not designated as legal tender.  That is a critical distinction.  By law, government currency must be accepted as satisfaction for a debt.  Failure to accept legal tender abrogates the debt.  Money does not have to be backed by gold or anything else.  In fact, there is not enough precious metal in this world to back the volume of currency in play.  Money is backed by law.  Crypto-currencies are backed by hype.  Lots of hype.  Lots of expensive hype.

At one point Trump (and his pal Musk) considered backing crypto with our gold supply in Ft. Knox!  That would have meant that any oligarch (whom Trump says he knows and knows to be good people) can present crypto to the United States and we would have to give them gold in response.  We end up with arcade tokens and they end up with a finite metal which, among other things, is necessary for the building of solar cells. 

Know this: Trump has been bought and sold by the Russian communists.  They are now well on their way to using him as a tool (asset???) to bankrupt this country.  If you bought Trump’s coins you get what you deserve.  But if you voted for him, you are complicit in the destruction of the nation.

 Stand for America. It is now time—pass time—for you to keep the faith.