Macro

• Cognition refers to the role of intelligence as the primary input of production and social organisation.The one thing no machine could do was exercise general judgement: to reason flexibly, across domains, in the face of novelty. That boundary is now dissolving, and with it the assumption that human intelligence is the irreducible input of

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Change is the permanent condition of history but stability and stasis are not the same thing. A structure can absorb enormous disruption while its foundations remain intact. What is rare, and what we are now encountering, is when the foundations move.

But the punch line is this: the catalyst came from non-crypto tradfi derisking, which happened to push Bitcoin down to a level where short gamma accelerated the downside due to hedging, but not directional, activities which in turn led to the requirement for more inventory- this then reversed quickly on 2/6 for tradfi market neutral (but... See more

Our mistake at GMI was not seeing the US liquidity as the current driving factor, when it is usually Global Total Liquidity that dominates over the full cycle. But now it is clear, and it is still The Everything Code at play...

There is no disconnect. It's just that the confluence of events Reverse Repo drained >TGA rebuild > Shutdown >... See more

Warsh will cut rates and do nothing else. He will get out of the way of Trump and Bessent who will run liquidity via the banks. Mirran will likely force through the full reduction in the eSLR too in order to goose the process.

Now, the US gov is shutdown...again. The Treasury hedged this by not drawing down the TGA at all after the last shutdown and in fact added more to it (more liquidity drain).

This is the current air pocket we are facing and it's causing brutal price action. No liquidity for our beloved crypto yet.

However, the signs are that this shutdown will get... See more

The rally in gold essentially sucked all marginal liquidity out of the system that would have flowed into BTC and SaaS. There was not enough liquidity to support all these assets, so the riskiest got hit. C'est la vie.

Bringing this back to our earlier framework: metals are telling you spot debasement is happening; Bitcoin will tell you when the yield curve itself breaks.

The Zero-Sum Reality

These three markets (AI growth, housing, and Treasuries) collectively represent over $100 trillion in capital. They don’t all need to collapse for Bitcoin to succeed in a negative rho world, but they do need to become less attractive relative to zero-yield alternatives.

That happens in two ways: either rates go deeply negative... See more