El Salvador expected to default as bitcoin plummets

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Lakados

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So back in September of 2021 El Salvador's bitcoin bro President went against all his financial advisors and made Bitcoin a legal currency in the country, now that it is in the process of crashing unless it makes a large turn around they are expected to default on their international debts as a result of it.

https://english.elpais.com/economy-...-expected-to-default-as-bitcoin-plummets.html

The two might not be directly related as the President has made a lot of questionable decisions since their election but it's not a good thing.
 
And crypto bros would like nothing more than to have fiat completely replaced by cryptocurrency.
 
And now they’re buying more https://arstechnica.com/tech-policy...oin-after-ratings-agency-downgrades-its-debt/
Seems El Salvador might suffer from toddler Oppositional defiant disorder (ODD) .
In January, the IMF recommended that El Salvador liquidate its bitcoin holdings in order to shore up its fragile balance sheet. The Bukele administration reacted angrily, with Treasury Minister Alejandro Zelaya declaring that "no international organization is going to make us do anything, anything at all."​
 
And now they’re buying more https://arstechnica.com/tech-policy...oin-after-ratings-agency-downgrades-its-debt/
Seems El Salvador might suffer from toddler Oppositional defiant disorder (ODD) .
In January, the IMF recommended that El Salvador liquidate its bitcoin holdings in order to shore up its fragile balance sheet. The Bukele administration reacted angrily, with Treasury Minister Alejandro Zelaya declaring that "no international organization is going to make us do anything, anything at all."​

You can lead a horse to water...
 
But he bought the dip
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You know, the USD is crashing as well. The difference is, they just keep it "stable" but charge you more to buy things. Don't be fooled for one minute.

The USD is actually strengthening relative to other currencies due to flight to safety, your domestic inflation problems are a byproduct of clowns running US fiscal and monetary policy for the past three decades. The Fed has raised interest rates by a pathetic 50 basis points, and not even stopped inflating its balance sheet, and now the entire global financial system is shitting the bed.
 
The USD is actually strengthening relative to other currencies due to flight to safety, your domestic inflation problems are a byproduct of clowns running US fiscal and monetary policy for the past three decades. The Fed has raised interest rates by a pathetic 50 basis points, and not even stopped inflating its balance sheet, and now the entire global financial system is shitting the bed.

You can call it what you want, but in the end when your money is only worth 50% (everything has doubled in price. I used to get 4L of milk for $4. Now it's $8.) of it what it was less than 2 years ago, the crypto being down 50% no longer seems so "crazy".
 
You can call it what you want, but in the end when your money is only worth 50% (everything has doubled in price. I used to get 4L of milk for $4. Now it's $8.) of it what it was less than 2 years ago, the crypto being down 50% no longer seems so "crazy".
"Everything has doubled in price" is a pretty big exaggeration. Where is this because it's nowhere near that in the US.
 
"Everything has doubled in price" is a pretty big exaggeration. Where is this because it's nowhere near that in the US.
I would hazard a guess that some pretty important things have. Definitely not ALL things, but things that quickly add cost and are usually unavoidable. Gas and good being the biggest. I'm sure you drive a car and eat food.
 
You can call it what you want, but in the end when your money is only worth 50% (everything has doubled in price. I used to get 4L of milk for $4. Now it's $8.) of it what it was less than 2 years ago, the crypto being down 50% no longer seems so "crazy".
You are just experiencing the actual price of gas, what the rest of the west has been paying for decades.
 
You are just experiencing the actual price of gas, what the rest of the west has been paying for decades.

I know you're from the UK, so I'll just say this. Your fuel is more because you use less, on average (based on how close everything is to everything out there). Yes, there are the outliers that travel for work, but in the end I can cover 8 countries in the UK faster than I can cross Texas. Therefore we use more (I'm Canadian, but you get the picture) so our prices are lower.

Expecting two countries, with VERY different supply and demand requirements to pay the same is idiotic. You can be salty because it's so pricey there, but it doesn't work well for your argument besides "suffer like us".
 
Ummm, okay? I mean you didn't even define a time period. I assumed we were talking over the past year or 2.
And we are. There are numerous graphs out there, which I would share, but I think sharing pictures outside of the meme thread is a no no. Gas and food have both increased, for MOST, by a shit ton. To act like nothing has changed is just blind liberalism.
 
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Yeah I have not seen food price double price for the past 2 years. I'm in San Jose California area. Actually some of the food items haven't gone up at all. Gas has definitely gone up, but not double. I think it's like 6$/gallon now? Used to be $4.50 ish? Rent went up about like 5% to 10% for the past 2 years. This is just personal experience, I'm not claiming this for anyone else (not even in my own area, except for the gas prices, someone correct me if im wrong there).
 
And we are. There are numerous graphs out there, which I would share, but I think sharing pictures outside of the meme thread is a no no. Gas and food have both increased, for MOST, by a shit ton. To act like nothing has changed is just blind liberalism.
You literally said everything doubled (quoting just milk where you are), then just gas and milk, and now not even doubled.

Look, I get it. I'm not saying things haven't gone up. But food down here (I'm just over in MI) has literally not shot up double. It's not great, but it's hardly comparable to some country going bust doubling down on crypto
 
Gas is almost double (on average) since last year in Louisiana, but it's about the same as...think it was 2016. It fluctuates a lot.
 
You can call it what you want, but in the end when your money is only worth 50% (everything has doubled in price. I used to get 4L of milk for $4. Now it's $8.) of it what it was less than 2 years ago, the crypto being down 50% no longer seems so "crazy".
Would that mean crypto is actually down by 75% ? If it is down 50% relative to something that lost 50% ?
 
You know, the USD is crashing as well. The difference is, they just keep it "stable" but charge you more to buy things. Don't be fooled for one minute.
The difference is, I can still buy anything I need using fiat. While you are entirely correct, there is a reason crypto hasn’t taken over.
 
I know you're from the UK, so I'll just say this. Your fuel is more because you use less, on average (based on how close everything is to everything out there). Yes, there are the outliers that travel for work, but in the end I can cover 8 countries in the UK faster than I can cross Texas. Therefore we use more (I'm Canadian, but you get the picture) so our prices are lower.

Expecting two countries, with VERY different supply and demand requirements to pay the same is idiotic. You can be salty because it's so pricey there, but it doesn't work well for your argument besides "suffer like us".
Volume and price are not linear inverse functions of each other. And why does your made up rule only apply to petrol? I mean the US also uses more of most other goods, right? Do you expect to get your next CPU at half price too? Or your food?
 
You can call it what you want, but in the end when your money is only worth 50% (everything has doubled in price. I used to get 4L of milk for $4. Now it's $8.) of it what it was less than 2 years ago, the crypto being down 50% no longer seems so "crazy".
No, it seems even MORE crazy. If everything doubles in price (it hasn't by the way) then that means that all assets should also double in price. When inflation happens, prices go up as the value of the currency goes down and that includes the prices of assets like land, stocks, commodities, etc. So if a currency halves in value, your asset should double in price if it has no change in value. If you bought a house for $200k and then suddenly the USD was worth only 50% of what it was the day before, your house would sell for $400k and it would be the same value as it was before.

So if the dollar has dropped by 50% (it hasn't) AND crypto has dropped by 50% (it has dropped by more than that), that means that in real terms it would be down by 75%.
 
In other news Luna was trading for a whopping 1-2 cents today. Oh so many people praising the algorithm system for stability with a “stablecoin”. This at least bring caution to people, and I’m sure it has. You can be a big, you can claim whatever you’d like, you can still fail, regardless of what category your crypto of the week coin falls into.
 
Yeah I have not seen food price double price for the past 2 years. I'm in San Jose California area. Actually some of the food items haven't gone up at all. Gas has definitely gone up, but not double. I think it's like 6$/gallon now? Used to be $4.50 ish?
Don't forget that you started from a high baseline. Gas is edging over $4/gal for regular here in coastal Texas, and it was $2 or less two years ago.

Food prices haven't doubled, but there's been noticeable increases, and restaurant prices have gone up quite a bit.
 
From spending 10,000 BTC to buy a couple pizzas in 2010 to El Salvador buying just a fraction of that to use as their national currency in 2022.
 
Google is saying that El Salvador total reserve is 2,301 bitcoin, valued around 71 millions at current price. El salvador M1 supply is nearly 5,000 millions, their M3 is around 17,000 millions, their annual GDP is around 24,600 millions USD.

I.E. they virtually no Bitcoin and I imagine it is far from being the country actual national currency or anything, if both google and tradingeconomics.com is not lying to me.

Their latest buying dip news was something has low has 500 coin or something of the sorts.
 
You can call it what you want, but in the end when your money is only worth 50% (everything has doubled in price. I used to get 4L of milk for $4. Now it's $8.) of it what it was less than 2 years ago, the crypto being down 50% no longer seems so "crazy".
The situation will only get worse. Everyone is expecting the housing market to crash and it will happen in 2022. The gas prices will kill the SUV market and force people to actually drive sensible cars. A lot of stocks are dropping lately. Do people really think that inflation has no consequences to the economy? Not that I care about crypto since it will drop as it has done before many times. It will also go back up as it's done before many times.
 
The situation will only get worse. Everyone is expecting the housing market to crash and it will happen in 2022. The gas prices will kill the SUV market and force people to actually drive sensible cars. A lot of stocks are dropping lately. Do people really think that inflation has no consequences to the economy? Not that I care about crypto since it will drop as it has done before many times. It will also go back up as it's done before many times.
Don't worry, apparent in here inflation is fine and prices have barely risen in two years! We are all just imagining things!
 
The situation will only get worse. Everyone is expecting the housing market to crash and it will happen in 2022.

Doubt it. There may be some localized stagnation or value loss in some of the markets where the gains have been the most rapid, (largely 2nd tier cities) but since the housing values have gone up by 30% in a year there, and the absolute most (and highly unlikely) reduction we are likely to see is ~15% they will only back off about 6 months worth of value. A minor correction, not a collapse. It will suck for those who bought at the height, but we won't see anything like 2007-2010, in large part because mortgages were done right this time. People can actually afford their mortgages now.

In first tier cities there is still a shortage of supply and a lot of demand. The demand will likely drop a little due to mortgage rates going up, but the supply is still os low, that most aren't expecting any drops in value, just a return to more normal appreciation rates. This is likely how things will go in most parts of the country. A return to single digit per year appreciattion, instead of the crazy rapid value increases we have now. No crashes. In a few select second tier cities there will likely bbe a stagnation or even a small reduction in value, but nothing crazy.


The gas prices will kill the SUV market and force people to actually drive sensible cars.

Honestly, I wouldn't mind this. Dealing with SUV's and trucks on the road is so annoying.

Remember 2005, the last time we saw $4+ gas (which adjusted for inflation is probably more money than today's prices). It was such a relief when people started buying cars again. The roads became so much nicer.

A lot of stocks are dropping lately. Do people really think that inflation has no consequences to the economy?

Inflation does have an effect.

Low amounts (~2% per year) are ideal for the economy. Too high or too low, and we start seeing issues. The rest of the market fundamentals right now are pretty good though, so while I think we are likely to see a small recession as the Fed tries to combat inflation by raising interest rates, I don't expect a big one.

And that may actually not be a bad thing. The way the job market is right now, a small recession may just get unemployment rates back to a normal ~5% "full employment" level.

As far as I am concerned, I have a huge mortgage, so inflation is actually helpful (as long as wages increase as well). It winds up effectionely reducing the amount I owe :p

Not that I care about crypto since it will drop as it has done before many times. It will also go back up as it's done before many times.

The inflation conversation is actually one of the reasons Crypto is a problem. Crypto is by its very nature deflationary, as there is a practical limit to how much can be mined, and it gets harder and harder to mine more all the time. Deflation is VERY bad for the economy. More so than a slightly elevated inflation as we are seeing now. This is why Crypto can never replace a FIAT currency.

So much of the economy is driven by consumer credit, and when there is deflation, your debt GROWS with time, even if there is no interest. It puts a huge damper on consumer spending and hurts the overall economy pretty badly.
 
Don't worry, apparent in here inflation is fine and prices have barely risen in two years! We are all just imagining things!
Who in this thread has declared prices have barely risen in two years? I think people are confused why you said everything has doubled in price over 2 years. That's about 41% inflation rate? Is this data for a particular country or what?

edit: im not sure you specified a date range, if not, please specify since when you are saying prices doubled. Or you could also just tell us that it was a hyperbole, i mean we've all been guilty of it. Unless your date range is starting from 1900? In that case why did you so severly understimate the inflation rate.
 
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Who in this thread has declared prices have barely risen in two years? I think people are confused why you said everything has doubled in price over 2 years. That's about 41% inflation rate? Is this data for a particular country or what?
Yeah idk. It's hard to have any sort of conversation when people just want to go from one extreme claim to the next. Now just saying "no, food has not increased nearly that much" is the same as saying "10% inflation is okay and I support more".
 
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