When Will I Admit I Was Wrong About Bitcoin? When This Happens.

Conditions will be ripe soon, so we'll find out in the near future. But even if bitcoin actually is a viable money derivative, gold and silver are still money and will go vertical in the End Game.

• I could be wrong about bitcoin, theoretically, and below I explain what would have to happen for me to admit it. We'll find out soon, because the conditions are almost ripe.

• The dollar supply is about to take a dive.

• Silver vs Commodities tests long term resistance only surpassed in 2011 during the $50 top, and during the lockdowns.

• Corporate bond spreads near all time low, and Fed balance sheet falls below $7 trillion.

Bitcoin Aims for All Time Highs vs Gold

Those long bitcoin have a chance to walk away very near all time highs of 37.5oz. They should take it. We are already at 34. That's an amazing 8 ounces in less than two weeks.

Just looking at this chart with even a modest level of humility and you'd realize that this kind of insane volatility nobody would be able to hold on to in a cash crunch. From 5oz to 37.5oz in three months, and then from 37.5oz to 10oz in a year? That's more than a 66% decline. Would anybody be able to stomach this kind of movement in a real dollar crunch as margin calls explode and debts get called in and banks fall? Give me a break. This isn't money. This is designer drugs.

Still, people ask me when I will admit I'm wrong about bitcoin, that it really can be, and is, a viable money derivative. I have a definite answer. My answer is that if the price of bitcoin, measured in gold ounces (not dollars), can demonstrate relative stability through the next dollar crunch, I will admit that bitcoin has somehow positioned itself as a viable gold derivative. I won't be able to explain how it happened, because I don't see how it can, but if somehow bitcoin can empirically show stability in ounces during a financial crisis, then that's what must have happened. I will admit I was wrong.

That wouldn't change the fact that the purchasing power of gold (and silver) will still rocket higher faster than any other commodity in an End Game scenario. It would just add bitcoin to a very short list of surviving gold derivatives when the dollar finally falls.

We'll see what happens when we get to the next crunch. My guess is bitcoin will perform even worse than it did in 2022.

COT Developments

Gold bullion bank short positions are 15% down from their peak, with price higher since then, $2,694 vs $2,638. The positioning is now much less extreme, but still dangerously high in the short category. But this is a good sign that gold is resisting the fall in bullion bank short positioning. The price normally goes down as the banks cover. This time it's not, at least not yet.

Dollar Supply About to Take a Dive