Green Optionality and Perception

Shortened travel week edition. I’m on the road for a High Performance Festivus get together in flyover country with some of the best and brightest this country has to offer.  Will give a full download next week.

Busy week on the news front. The CDC finally admitted the whole mask thing was an empty charade and is now saying go ahead and throw away your mask if you’re vaccinated. Anyone who has followed my writing (or can read data), knows that masks at best offer neutral efficacy, and are likely a net negative overall. Trying to stop a tiny viral particle with a cloth mask is like trying to stop a mosquito with a chainlink fence. There’s a reason that 50 years of studies and ‘science’ came down conclusively on the side that $0.02 amateur cloth masks are completely ineffective to stop a virus.

At least that was the consensus until March 2020, when the powers that be changed their mind on a dime.  If you recall, the primary logical jingoism they used to justify mask wearing and convince the majority of the population not susceptible to Covid mortality was that even though you may not be vulnerable, you may be near someone who might be affected and thus should wear a mask. Because YOUR MASK PROTECTS ME, AND MY MASK PROTECTS YOU.

Funny how they dropped that laughable fiction on a dime and now say toss that mask in the garbage if you’re vaccinated.  Well as most people are aware, being vaccinated offers you almost no protection against getting or spreading covid. In fact, in the last 2 months, I’ve met more vaccinated people who got Covid than cumulatively over the last 12 months pre-vax.  So if vaccination doesn’t prevent you from getting or spreading Covid, why throw away the mask? What happened to, “MY MASK PROTECTS YOU?”  Obviously the whole thing was a sham but it’s been fun to see the neurotic progressives who have allowed their lives to be defined by their mask obedience over the last year encounter a serious case of cognitive dissonance as their ‘experts’ at the CDC (who haven’t been right about a single thing) throw them overboard.

I genuinely feel bad for these people, and hope they learn rather than crumble from the incredible psyop and manipulation that continues to be propagated 24/7.

Elsewhere, gas and food prices continued to spike along with inflation.  I gave you a heads up here 3 months ago that inflation was spiking, and this week the rest of the mainstream media and macro-economic talking heads finally caught up with economic reality.

Inflation will continue to be a problem, one the Fed simply cannot and does not want to contain.  Their past errors have completely boxed them in so like everything else we’ve done for the last decade (or 30 years) and compounded tremendously with the massive public policy mistakes of our hysterical Covid response (lockdowns, masks, unlimited printing, de facto vaccine passport conditioning, etc.), the end result is the middle and lower class will bear the brunt of spiking gas and food while the laptop class and elites will be slightly inconvenienced (mostly offset by the higher asset prices).

The inflation numbers and Elon Musk’s low grade grift hucksterism, led to a de-risk sell-off across the crypto market and tech stocks.

To everyone’s lack of surprise, inflation rates are accelerating at a pace we haven’t seen in over 12 years. April reports show that consumer prices leapt 4.2% in the fastest uptick witnessed since 2008. Energy prices are up 25% year over year, gasoline up 49.6%, and even used cars and truck prices are up 21%. Lumber cartels are basking in Big Stick Energy, with prices having increased a staggering 124% in 2021.

Despite the wishful thinking Fed mantra of “transitory,” inflation is showing a steady acceleration. Bitcoin, the King of Hard Money and stock-to-flow reigning champion due to its algorithmic scarcity has typically soared on news of rising inflation, this time around, its behavior was atypical and muted.

Elon Musk, in a puzzling series of events, announced on Twitter that Tesla would stop accepting Bitcoin payments due to environmental concerns, although it plans to keep its existing Bitcoin on its balance sheet. It was only in February 2021 that Tesla announced they added $1.5 Billion of Bitcoin to their balance sheet, and in March that they started accepting Bitcoin payments for its cars.

“We are concerned about the rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.” - said Musk (DeCrypt)

Musk and Tesla’s drastic change in stance towards Bitcoin caused market panic and widespread confusion. Bitcoin’s environmental debate has been long-standing for years. Bitcoin doesn’t just consume energy, it turns energy into scarce transactable value. What is often overlooked is the estimate that the Bitcoin network is powered by around 40% to 70% renewable energy, making it much more sustainable than is reported.

Bitcoin mining also brings financial incentives to innovation and expansion of renewable energy, giving a direct way for green energy producers to translate the power they create into easily accessible real-world value while also reducing inefficiencies. For example, as a result of Bitcoin mining, oil fields that used to burn off excess methane gas into the atmosphere (flaring) now utilize that methane byproduct to power Bitcoin mining operations.

While Bitcoin’s energy consumption has been on the rise in 2021, one would have expected Tesla and Elon to do their due diligence on the matter before embracing and changing stances on its position. Perhaps this is now to be expected, as during Elon Musk’s debut on Saturday Night Live he called DogeCoin a hustle right before cheering it on, “to the moon.”

Bitcoin has been the target of a coordinated, worldwide anti-PR effort by environmentalists over the past few months. The Green Team is not pushing clean and green for the sake of the planet, they’re driving towards a whole new economic system aligned with The World Economic Forum’s Great Reset. But that’s a topic for another day.

The important lens through which to view all of this is that almost none of the elites and institutions actually pushing “green” or ESG are remotely EITHER, as measured by any objective standard.

Bitcoin in comparison, measures up just fine.

For the conventional defense of Bitcoin’s environmental chops, Nic Carter and others in the space do an admirable job. I’ve included several important links at the bottom, but the TLDR (yes, please thank me later for consuming about 300 pages of articles and treatises for you by recommending the newsletter to a friend) is that about 40-70% of Bitcoin’s energy comes from renewable sources.  Since BTC mining is a capital and equipment intensive process (which is actually a good thing, as energy + capital = security, and when it comes to money, censorship-resistant, secure hard money is the monetary Holy Grail).  To increase their chances of winning the mining reward and thus increasing their profits, miners are required to seek out the lowest cost alternatives, which generally is excess renewable energy.

Bitcoin will continue to incentivize the lowest cost, most efficient energy through free market dynamics.  Plus, carbon credits and other quasi-gimmicks can easily offset any actual usage.  But again, that matters in places like the US and elsewhere.  In China, energy equals whatever is abundant available.  About half the year, China during the wet season does most of its mining in the Xichuan region where energy is excessive and cheap hydro, clocking in at a mere $0.01 per kWh. The other half of the year is significantly less green and more expensive.

Frankly, whether China utilizes renewable or not is irrelevant. Just like the Paris Climate accords and every other Climate Treaty, China is above social and political reproach, and will do whatever it pleases.  Puppet scolds like Greta don’t even bother mentioning China during her rants because her handlers know China doesn’t give one f*ck about Greta or the environmentalists. They’re immune to external pressure and even if they decided to verbally say they’ll play along, it’s obvious they’ll cheat at it just like nearly everything else they do (public accounting, economic statistics, Covid origination and severity cover up, etc.).

Frankly, I hope China uses ‘dirty’ coal and fossil fuels for all of its power needs including bitcoin mining. People are finally waking up to the fact that the CCP is the arch nemesis of freedom, liberty, human expression and nearly everything good on this earth. Anyone that’s been to China recently knows that the air is literally unbreathable at times in their major industrial cities.  Nothing would be better for the world than if this evil giant kneecaps itself due to their voracious consumption of fossil fuels and lack of respect for the environment and its citizens’ health. Similar to the irony of Capone, a violent psychopath taken down for nonviolent tax evasion, it would be poetic justice to see the murderous hegemonic CCP crumble for suffocating the very air its military and citizens require to breathe.

The bottom line is BTC is no worse and probably a bit better than most of the other forms of money from an environmental perspective.  Even with the minor negative externalities (which I’m a skeptic on due to the people that are pushing these arguments and their overall ideologies (You will eat bugs, live in the pods and own nothing, and you will be happy), it’s clear that Bitcoin is far lighter on energy and waste than the traditional system which has produced massive income inequality.

People who think Elon Musk doesn’t get the “energy” issue are fooling themselves. It doesn’t take any intelligence to figure this out. But let’s consider, how much energy does the traditional financial services sector waste? Think of all the coins in circulation that are less valuable now than the material themselves (sorry, not much nickel, copper or silver in pennies, nickels and dimes these days).  All that energy is wasted in making the item since value was destroyed.

How much energy is consumed by millions of computers/air conditioning units in massive real estate footprints of branches/offices etc, and the time/fuel spent commuting there?

How much energy is consumed printing physical bills – ink, transportation, etc?

How much energy is wasted by the transportation of rocks – diamonds, gold etc, and the massive environmental damage to mine them?

How much energy is wasted by ALL the unused ATMS/machines running 24/7 when no one is using them?  How much energy is wasted on the massive databanks to store and secure the system?

The reality is, the benefits bitcoin can offer – censorship, immutable money resistant to inflation, debasement and political and economic manipulation, more than outweighs any perceived negative externalities.

Regardless, let’s be real. If the Green Dream Team believed in the climate catastrophe as much as they preach, you wouldn’t see the rampant hypocrisy that marks everything the Left does.  While they admonish the plebs who they consider mere ‘extras’ in their movie to Go Green and give up the extraordinary benefits of capitalism (even in its imperfect, crony form), they see no shame in owning multiple mansions and flying private everywhere. Noble lords like Sir Leo DiCaprio and the King of Global Warming Al Gore always like to hide the Inconvenient Truth that their multiple 10,000 sq ft mansions and Gulfstreams have a bigger carbon footprint than most of the small towns in rural America.

So I’ll ignore the green apocalypse they consider Bitcoin.  The reality is, they don’t hate Bitcoin because it’s a Green Apostate, they hate Bitcoin for what it represents – an exit valve and hedge against the kleptocracy and the best shot at sane money policy and freedom left in our endemically corrupt political and financial system.

Now that’s a rehash of the conventional argument and wisdom surrounding BTC.  My true take is a bit different and Machiavellian.

I want BTC to have a (minor) toll on the environment and be despised by progressives and environmentalists for ulterior reasons. After all, Bitcoin is synonymous with free markets, liberty, individual choice and other things the Left despises.

The end game is bitcoin will make progressives considerably poorer as they tread water in the legacy financial systems.  As BTC climbs, I don’t want wealth being created or personal financial sovereignty being granted to people on the Left.  Like a plague, they destroy everything they touch.  The Left already owns and manipulates every major institution in our country (except organized religion) – the media, academia, Big Tech  and the political system.

Bitcoin is one of my primary macro methods (decentralized white hat hackers/tech and species propagation/ breeding a few of the others) that we can use to marginalize and minimize the damage they continue to cause.  By framing BTC as anti-environment, we can encourage woke progressives to self-select out of the greatest transfer and creation of wealth in a century.

Less wealth = less power and reach. I’d rather red-pilled Americans and aligned individuals and communities across the globe have a foothold in one of the most powerful exponential technologies of our age and capture the wealth created by the adoption curve before anyone on the Left reaps its benefits.  Let the Left be the final wave that capitulates at $1M+ when they have no other option than to hold their nose and pile in to desperately protect against dollar debasement and the cashless society.

As my good friend Bitcoin TINA says, Bitcoin is in the process of going from an illegitimate asset, to a legitimate asset to a ‘must-own’ asset.  I don’t want to see the authoritarian Left accumulating bitcoin until we enter the ‘must-own’ stage, and at much higher prices.  Let that be the minimum punishment they deserve for the damage they’ve wrought. If that means cloaking Bitcoin in an anti-Green Charcoal Dreamcoat for now, so be it.

In sum, woke totalitarianism is a disease that destroys everything in its wake. One way to minimize its power and destructiveness, is to cap it’s financing and wealth by prompting its adherents to self-select out of this new monetary paradigm (which is actually an old monetary paradigm – hard money is the de facto monetary default in any logical, sane system - it’s the easy money, fantasy MMT printer go brrrr monetary theory that we can print unlimited dollars with no ill repercussions, that is a fraction of history and a real-time experiment that people 50 years from now will shake their heads at on the educational Holodeck).

Nothing above should be read to minimize our God given responsibility to be good stewards of the Earth.  Where possible, we should minimize our impact and strive towards use of renewables or cleaner forms of energy.

Having said that, as you can probably tell from the above, most of the Green Initiatives are not about actually preserving the Earth, but more a hypocritical control mechanism that relegates the plebs of the Earth to a dystopian existence.  It’s Ribeyes, Gulfstreams, Epstein girls and Elysium for Team Moloch, and depopulation and cashless social credit scoring for the remaining 8 billion of us. While certainly not gospel, here’s some perspective from Alex Epstein on climate catastrophism.

Talking Points on the So-Called Climate Crisis

While climate catastrophists claim that our climate is less livable than ever because of fossil fuels, it is actually more livable than ever thanks to our fossil fuel powered climate protection systems. Rising CO2 levels will cause mild, manageable warming as well as significant global greening--not a crisis.

Quick summary

1. When you hear scary claims about a “climate crisis,” keep in mind that climate catastrophists have been claiming climate crisis for 40 years. For example, Obama science advisor John Holdren predicted in the 1980s that we’d have up to 1 billion climate deaths today.1
2. After 40 years of “climate crisis” predictions by climate catastrophists, human beings are safer than ever from climate. The climate death rate has decreased by *98%* over the last century.2
3. Fossil fuels were supposed to make climate far more dangerous in the last 40 years but they have actually made it far safer by providing low-cost power for the amazing machines that protect us against storms, protect us against extreme temperatures, and alleviate drought.3
4. Fossil fuels' CO2 emissions have contributed to the warming of the last 170 years, but that warming has been mild and manageable—1 degree Celsius, mostly in the colder parts of the world.4
5. Fossil fuels' CO2 emissions have not only contributed to mild and manageable warming, they have also caused the benefit of significant global greening. Thanks to fossil fuels the Earth is far greener than it was just 40 years ago.5
6. If the world continues using fossil fuels to provide reliable, low-cost energy to billions of people, the result will not be a climate crisis but continued manageable warming, significant greening, and a far better life for billions of people.
7. If America tries to rapidly eliminate fossil fuel use through a Green New Deal or Biden Climate Plan we will not prevent a crisis, we will cause a crisis by making energy completely unreliable and unaffordable for American industry and American consumers.

References

1. “As University of California physicist John Holdren has said, it is possible that carbon-dioxide climate-induced famines could kill as many as a billion people before the year 2020.” -Paul Ehrlich, The Machinery of Nature (1986), p. 27
2. For every million people on earth, annual deaths from climate-related causes (extreme temperature, drought, flood, storms, wildfires) declined 98%--from an average of 247 per year during the 1920s to 2.5 in per year during the 2010s.

Data on disaster deaths come from EM-DAT, CRED / UCLouvain, Brussels, Belgium – www.emdat.be (D. Guha-Sapir).

Population estimates for the 1920s from the Maddison Database 2010 come from the Groningen Growth and Development Centre, Faculty of Economics and Business at University of Groningen. For years not shown population is assumed to have grown at a steady rate.

Population estimates for the 2010s come from World Bank Data.

1. Using the average world population in the 1980s (4.8 billion) and the 2010s (7.3 billion) and the average deaths per year from all meteorological, hydrological, and climatological disasters for both decades (66,697 and 18,342 respectively), the annual deaths rates per one million people from climate-related disasters has declined by over 80% from 13.8 to 2.5.

Disaster deaths from EM-DAT, CRED / UCLouvain, Brussels, Belgium – www.emdat.be (D. Guha-Sapir).

Population estimates from World Bank Data.

1. The decadally smoothed data from the UK Met Office HadCRUT4 dataset (column 1 contains the year, column 2 the decadally smoothed temperature anomaly data in °C) shows an increase of 0.974°C between 1850 and 2019.

It also shows a warming of 0.275°C between 1850 and 1945, before atmospheric CO2 concentrations really took off.

1. Regional trends vary, but overall the world's leaf area increased by 5.4 million square kilometers, or an amazon rainforest worth of greening, between 2000 and 2017 alone with over 1/3 of vegetated land showing an increase while only 5% showed a loss of green vegetation.

“Long-term satellite records reveal a significant global greening of vegetated areas since the 1980s, which recent data suggest has continued past 2010.
…
Global vegetation models suggest that CO2 fertilization is the main driver of global vegetation greening.” - Piao, S., Wang, X., Park, T. et al. Characteristics, drivers and feedbacks of global greening. Nat Rev Earth Environ 1, 14–27 (2020).

What I’m Reading…

**Good summation by my friend Lou Kerner on Morgan Stanley's 5 Reasons Why Investors Should Begin to get educated on crypto.

**This one will probably put me on ‘yet another’ government watch list, but the studies keep pouring in that Ivermectin works. At $2 a pill and a safety record lasting decades, we could have avoided the entire Covid “thing”. But then Trump would still be President, politicians would have less control, plutocrats would be less rich, and Big Pharma would be hundreds of $Billlions poorer

**Happy to say I read Chaos Monkeys before it became the Silicon Valley must read summer book of 2021.  Here's Taibbi's takedown of Apple's cancellation of the talented Antonio Garcia-Martinez because he said something modestly offensive (and true) 5 years ago.

**It's not just Morgan Stanley, but Goldman, Point72 and and Millenium are all piling into crypto and launching funds or hoping to service clients.

**Remote mind control is on the horizon.

**CPI is not an accurate reflection of cost of living changes, thanks to hedonic adjustments.

**Burning a $95,000 Banksy to auction it off as an NFT without a physical copy. The NFT sold for well over $300,000.

**Best banks for Bitcoiners.

**Arthur Hayes on Fear and Dog Money.

**This is why we can’t have nice things. Coordination failures, and the tragedy of the commons.

Here’s a fairly exhaustive tweetstorm on Bitcoin and its use of energy to counter some of the misinformation out there. No need to read them all, but the first one is very good.

What I’m Watching…

Twitter Octagon

Parting words

“Crypto wasn't created to make you rich — it was created to make you free.”