Just over a month a go we discussed Frank Homes, CEO of US Global Investors, who had returned from the LBMA/LPPM Precious Metals conference in Barcelona after giving the key note address on Day 2, “Quant Investing: From Gold to Cryptocurrencies.” Homes’s presentation was voted the best – no doubt helped by the topical subject matter – and he was the recipient of an ounce of gold.
Seeing a role for both gold and cryptocurrencies in portfolios, he aimed a couple of blows at recent Bitcoin detractors, including you know who from JPM. As we noted at the time, however, it was Homes’s observations on Metcalfe’s law, i.e. the economics of network effects, which we particularly enjoyed.
This was his take on the surge in the price of Bitcoin...
“Metcalfe’s law states that the bigger the network of users, the greater that network’s value becomes. Robert Metcalfe, distinguished electrical engineer, was speaking specifically about Ethernet, but it also applies to cryptos. Bitcoin might look like a bubble on a simple price chart, but when we place it on a logarithmic scale, we see that a peak has not been reached yet.
In an article, Bitcoin and Metcalfe’s Law, Stephen Powaga of ETF Momentum Investing acknowledges the challenges of valuing Bitcoin and has also turned to Metcalfe’s Law.
With the recent run up in the Bitcoin price, cryptocurrencies have been garnering much greater attention from the public at large.
A rapid price rise like this presents a difficult situation for potential new investors into the space. On one hand, this price action appears to be a classic asset price bubble, but on the other hand investors can wait years for a meaningful drawdown, all while missing out on the intermediate price appreciation.
How then can one determine a benchmark value for Bitcoin? On the most basic level Bitcoin is a distributed payment network, and like all networks should be subject to Metcalfe’s Law.
Powaga continues by leading us through some of the basics of Metcalfe’s Law.
Metcalfe’s Law states that a network’s value is proportional to the square of the number of users. For instance, it’s obvious that if you’re the only person with a telephone then that network would have no value, when one additional person gets a phone the network has achieved a tiny bit of value, and if virtually everyone has a phone, then the network becomes extremely valuable. This relationship has been observed in many industries where increased adoption boosts the network’s overall usefulness, such as European internet usage, Facebook’s value, and more recently Tencent’s value.
A recent white paper by Ken Alabi finds that blockchain networks also appear to follow Metcalfe’s Law, in his paper he states, “it was demonstrated that the growth in the value of the network was related to the number of unique addresses”. This intuitively comports with our understanding of how Bitcoin’s value should operate, if you’re the only holder of Bitcoin it’s not very valuable because there is no one to exchange it with for goods and services, however if many people hold Bitcoin then it should be much more valuable since there are now many people to potentially exchange it with.
As Powega explains, he can show us how Bitcoin’s valuation has traded over time based on Metcalfe’s Law principles.
Given this information, what can Bitcoin’s network size tell us about its value and the size of the current bubble? Utilizing Alabi’s method we can arrive at Bitcoin’s Metcalfe Value through time and compare historic Price-to-Metcalfe Value ratios for Bitcoin.
This is somewhat analogous to price-to-book ratio in public equity analysis in that a higher ratio implies investors expect a given network to create more value from a given number of users.
As you can see above, the Price-to-Metcalfe Value ratio seen in the previous Bitcoin bubble of 2013/14 was far larger than where it currently stands.
Obviously, the future is unknowable, but given the enormous growth that Bitcoin has seen in its user base, the recent price appreciation may not be as “bubbly” as it appears.
What Powaga can’t tell us, however, is what is the intrinsic value of Bitcoin now, or what it might be in the future. Who knows? As we discussed, high-profile cryptocurrency investor, Mike Novogratz, sees Bitcoin at $40,000 at the end of 2018. In contrast, Peter Tchir, is taking some Bitcoin chips “off the table”.
Since all the people involved in the JFK murder and investigation are dead, one might wonder why all the fuss about documents from 50 years ago really matter. FX traders are mostly conspiracy theorists, either they are part of the FX rigging scandal making billions off the backs of unsuspecting clients that don"t understand FX, or they are traders trying to guess why markets move the way they do in order to protect their positions. In any case, FX traders see how FX moves ahead of terrorist events, and how the US Dollar tracks several hours ahead of key global military events. Also, the world really hasn"t changed much, especially the architecture of modern political power, so a look into the past can be also a look into the present. The parallels of JFK and Trump are interesting, both being from rich families and both in some way "turned" against the mainstream establishment. Although the world is too different now for a fair comparison, and JFK and Trump are nearly polar opposites when it comes to them individually. While the recent data dump of documents presents more circumstantial evidence than ever before - all from the ultimate source (the US Government) any "smoking gun" document has long been destroyed. Perhaps the only smoking gun is the "burned memo" which could be a cryptic assassination directive.
While the world wonders about President Trump, 54 years ago, a US President was murdered in broad daylight in Dallas, Texas; John Fitzgerald Kennedy - the only Irish Catholic President, and possibly one of the only US Presidents that was not a Freemason. To this day, the facts surrounding this event remain clouded. The "official" Warren Commission report presents fanciful theories about a "Magic Bullet" that was able to go in and out of JFK"s body multiple times, and other wild fantasies. But this official report is "official" and any other explanation of the events of that day are "conspiracy theories." As time has passed, and secondary information surfaces, there are indications of the true power of the information that was kept secret for so long.
The murder of JFK is perhaps one of the most significant events of the 20th century. In the past 10 years, new information has surfaced that portends to a major re-investigation into the issue. As well, a generation has passed since the event which took place 1963. This article presents two unique viewpoints, previously unpublished, as well as looking at some recently released evidence:
New evidence that has surfaced since the making of Oliver Stone"s "JFK" in 1991
Groundbreaking documentary created BEFORE release of documents "JFK to 911 is a Rich Man"s Trick"
The Warren Commission came up with nonsensical conclusions he said, such as the "Magic Bullet" and the lone assassin theory, that Oswald did it by himself. No one took it seriously, at the time, but what could anyone do? It was obviously much bigger than one agency, even bigger than the office of the President, so whatever power lurking in the shadows - was not one to mess with!
Part 1: The Book that all JFK researchers should read
Kennedy"s Last Stand: Eisenhower, UFOs, MJ-12 & JFK"s Assassination - This is a must read, for those interested in the topic of "information" and "informatics" even if you"re not interested in the subject of UFOs. The point here is that documentary evidence regarding the UFO conspiracy is real and comes from the top. A group so powerful (MJ-12) they shut out the President (Eisenhower) who overcame them only by threatening to invade Area 51 with the Army. In the past 20 years, new evidence has surfaced, some of which is presented in the book. Most significantly, the book points a paper trail right to the top of the CIA and beyond.
Small background on UFO phenomenon as it pertains to this story; UFOs were first discovered by the military over Los Angeles during World War 2. It was alarming because the Army believed that it was the enemy Japanese attacking, all they saw were "airships" shooting down from the sky; the idea of Aliens or UFOs wasn"t common knowledge at the time. See a brief summary of the "Battle of Los Angeles":
The Battle of Los Angeles, also known as The Great Los Angeles Air Raid, is the name given by contemporary sources to the rumored enemy attack and subsequent anti-aircraft artillery barrage which took place from late 24 February to early 25 February 1942 over Los Angeles, California.The incident occurred less than three months after the United States entered World War II as a result of the Japanese Imperial Navy"s attack on Pearl Harbor, and one day after the bombardment of Ellwood on 23 February. Initially, the target of the aerial barrage was thought to be an attacking force from Japan, but speaking at a press conference shortly afterward, Secretary of the NavyFrank Knox called the incident a "false alarm." Newspapers of the time published a number of reports and speculations of a cover-up.
Some contemporary ufologists and conspiracy theorists have suggested the targets were extraterrestrial spacecraft.When documenting the incident in 1949, The United States Coast Artillery Association identified a meteorological balloon sent up at 1:00 am that "started all the shooting" and concluded that "once the firing started, imagination created all kinds of targets in the sky and everyone joined in". In 1983, the U.S. Office of Air Force History attributed the event to a case of "war nerves" triggered by a lost weather balloon and exacerbated by stray flares and shell bursts from adjoining batteries.
After this "battle" UFOs were on the radar of the military - literally. Military planners, practically, incorporate every kind of potential attack into their strategy planning. UFOs were not looked at scientifically by the military - simply as a potential threat, whether from Hitler or another planet they didn"t care.
The second event that marked this age was the Roswell crash, still a big mystery to this day. Apparently, there were 2 crashes, one with actual biological bodies, and the press release was designed to take the focus away from the more sensitive site. According to the book, everything was taken to Area 51 for review, where the facility was placed under the security of the CIA and managed by a group formed by Truman known as MJ-12. A lot of this is not science fiction when considering Nazi scientists developed rockets that NASA still uses to this day via Project Paperclip. Remember that all of this happened around a time when USA was becoming a superpower, the CIA was just formed, along with the military industrial complex - including its corporate technology arm, still in use today (Silicon Valley).
This all shortly after the Roswell incident. Looking at all this from a technology standpoint is not so sensational. The fact that the Roswell crash was in fact a UFO possibly operated by a "robot" or "drone" from another planet or another timeline is not so far fetched. If the reader could be transported back to the middle ages of Europe equipped with a laser pointer, iPhone 7, automatic handgun, and other wizard"s tools, certainly the people would think that the user is a "God" who practices "Magic".
The most dramatic directive, likely drafted by Dulles (MJ-1), Director of CIA under JFK and apparently approved by six other MJ-12 members was a cryptic assassination directive. In full, this states: see last memo in series in link below.
Draft - Directive Regarding Project Environment - When conditions become non-conducive for growth in our environment and Washington cannot be influenced any further, the weather is lacking any precipitation … it should be wet.
The term “it should be wet” is a coded command to kill someone.
Detractors of this book will say that the author is reaching to connect the dots, and this cryptic message is not "clearly" the smoking gun evidence that everyone is looking for. But is it? Have a deeper look through these documents here:
To the less educated researcher, documents such as the letter from respected scientists Oppenheimer and Einstein regarding the UFO issue, and the letter from the anonymous CIA leaker re: James Angleton; may be of more significance, as the authenticity of these documents is more verifiable, and anecdotally more believable. Einstein for example published thousands of public essays and letters on various important topics of the day; this was a time when the power Elite relied on high IQ scientists.
There is no alternative paper trail, with a more powerful suggestion - solving the JFK murder. Most of the files have been released in a searchable archive, which you can find here: https://www.archives.gov/research/jfk
It is not likely that in the next 20 years another "smoking gun" document will be discovered, although it"s possible (it could be in some relatives attic, next to baseball cards and grandpas pipe saved from last century). So it"s reasonable to conclude that 95% of relevant information regarding the JFK scenario is out there, somewhere - in the ether. With the speed and velocity of the internet sleuth community, if there was such a relevant document such as photo (right) - it would have been distributed and redistributed, analyzed and discussed, ad nauseum.
What is the significance of this event, you ask? It"s a singularity, as they describe in physics (a point at which a function takes an infinite value, especially in space-time when matter is infinitely dense, as at the center of a black hole). From one perspective, it was simply a power grab by "faction 2" from "faction 1" as some describe big power politics. The Kennedy clan were outsiders, they were social climbers, they went against the power structure of the haves - case closed. But Kennedy or someone else - something more meaningful happened here. A group called the "Shadow Government" stopped Kennedy from exercising the powers granted to him by the Constitution and by the voters. It puts the entire system into question, proving basically that the United States operates by Mob Rule not so much different than a banana republic. A group of rich families and companies with deep pockets control the country through their trained surrogates. The continuation of this can be seen with political families such as Bush and Clinton who have a statistically unusual amount of deaths of associates, friends, and workers surrounding them. Some were even afraid to work for the Clinton camp due to the high number of workers who "suicided", disappeared, had heart failure, or stabbed themselves in the back 10 times.
Let"s thread through the irony of the power structure for the last 30 years with this interesting photo, and comparison, of a figure outside the Texas School Book Depository:
The photo on right, comparing the posture of a figure standing in a suit and tie is striking. George H.W. Bush Sr. later went on to be the director of the CIA, only for 2 years, under Gerald Ford. But Bush"s impact on the establishment would be large, as he would later be Reagan"s Vice President (and rumored that was more of a "President" during this time than Reagan ever was) and eventually President of the United States, and father of a future president, George W. Bush (his son).
(NOTE: It is interesting that the shadowy figure would 30 years later popularize the phrase "One World Order")
What kind of "organization" is out of the public view, has the means to organize such an assassination, and the motive? All points to one organization, really the only capable organization of organizing such a project. Look at some evidence, such as this list compiled by Wikispooks, of attempted or successful assassination attempts on foreign leaders organized by the CIA since World War 2: https://wikispooks.com/wiki/US/Foreign_Assassinations_since_1945 And here"s "Alleged Assassination Plots Involving Foreign Leaders" as compiled by the US Senate in 1975: CIA_Alleged Assassination Plots Involving Foreign Leaders
With such overwhelming evidence of the CIA"s involvement in foreign assassinations, if only one of these "plots" is true it"s reasonable to assume they all are true because after all, the CIA is a spy agency, not an overt military operation, so most of this is done with the clandestine service. And, if the CIA really does have a "hit squad" trained to topple and kill foreign dictators, then it is reasonable to assume this same operative group inside the CIA could potentially use this same group domestically. In fact, it is the only group in the world capable of assassinating a US President so successfully, including the use of insiders to change the course of the motorcade, for example.
Or to use another analogy as a means of deductive logic, 95% of hackers are inside jobs - in other words, hackers very rarely breach security from the "outside" - they rely on a rogue employee, security expert, or insider to provide key information such as passwords or other details needed to complete the job. This must have been the case with the murder of JFK because without those on the inside, such an epic target would not have been possible to hit. It was for this reason the "higher ups" at the FBI wanted this case closed and not discussed, because there clearly were insiders working against JFK who provided key info and modifying security protocols leading to the assassination.
The peak of outrage against government-sponsored assassination was the mid-1970s, when the Senate Select Committee to Study Governmental Operations — better known as the Church committee — spent more than 60 days questioning 75 witnesses about C.I.A. plots of the late 1950s and early 1960s. Back in the darkest days of the cold war, the agency had devoted significant resources and creativity to devising unhappy ends for unsavory or inconvenient foreign leaders. Among those listed for assassination were Patrice Lumumba of the Congo, Ngo Dinh Diem of South Vietnam, Rafael Trujillo of the Dominican Republic and, most famously, Fidel Castro of Cuba, who survived no fewer than eight C.I.A. assassination plots. The senators on the committee were intent on divining the full extent of the government’s role in these plots. How much direct authority, for example, did Presidents Dwight Eisenhower and John Kennedy exert over them? The committee’s conclusions were vague at best. The truth was that neither president would have allowed his hand to show in such affairs. Times have changed. Our president now interrupts regularly scheduled broadcasting to announce the news of an assassination himself.
Perhaps the details of the JFK murder, public coverage, and FBI investigation would have been different had it happened in 2010. Certainly it was a different time, before the internet, and at a time of much happiness and prosperity. Since "JFK" we"ve had "911" which is another game changer event that put the US on a different path as it was during the 90s. Perhaps every generation needs such an event to "remind" them of who is in charge? (Dr. Tony Blanton from Pine Crest Prep School is ringing in my ears "history is a struggle between the haves and the have nots and you are the movers and the shakers who are going to change society")
What secrets are the "shadow government" protecting or are they simply exercising their power to show the have nots that their ownership of the planet is above any government, any nation state, religion, or other entity? The UFO issue is concerning, particularly due to security concerns; because the information we do know is only bits and pieces from whistle-blowers and a few encounters that are not well documented. There are rumors that Eisenhower himself made a deal with the Aliens to keep them a secret in exchange for technology transfer through the military and corporate America. Maybe it was a good deal, maybe it never happened - who knows? The point is that, until real discovery and disclosure is achieved, we will be in the dark regarding important issues that can impact daily life on planet earth. Some important questions we need to ask beyond the shock value of understanding we are not alone in the universe:
Who are these aliens, what do they want? What has been "agreed" with them, if anything, and what current involvement do they have with US Military operations?
What of the stories that some of these creatures are multi-dimensional, or from another "timeline" (that they aren"t aliens from other planets but beings that live in many dimensions)?
How can we address issues of exo-politics if the CIA was dethroned as the sole security to Area 51 and ultimately, controlling the diplomacy between such aliens, if any?
Is there any truth to the stories they are abducting humans for purposes of experimentation, whether it be biological or genetic? What about the "hybrid" projects? If there is truth to it, how to stop it?
Do aliens have any current business arrangements with US corporations, US politicians, or are involved in major conflicts in any way? If so, this urgently needs to be addressed, and contracts re-evaluated. For example there are many accounts that UFOs were seen when nuclear warheads went dead (if even for a test).
Are there any secret government "libraries" or "archives" where files about aliens are kept, if so - where are they and in what format?
What"s interesting about this issue that it seems to be a wealth of information right here under our own desert. It"s like the metaphor about exploring space when we know less about our deep oceans. There again, rumors of alien bases under the deep seas. The amount of information regarding the veracity of such stories is immense, and it has gone parabolic in the last years as many who were alive and working during these times before modern security protocols and training were in place, are retired, dying, or have passed information onto children.
Part 2: The New Evidence
1963 was a long time ago. New facts and evidence have surfaced, most interestingly - we are on the precipice of a major data dump by the US Government still to be determined, scheduled for "sometime" in 2o17. See explanation from http://2017jfk.org :
In 1992, the President John F. Kennedy Assassination Records Collection Act mandated that in 2017 all remaining JFK records and redactions be released. However, the National Archives has recently informed federal agencies that if they intend on maintaining secrecy over these records they should begin preparing appeals to the next president of the United States. We are working to ensure that the law is upheld. We are calling on you, fellow Americans, to come together and ensure that our government upholds the law.
The parallel of the information secrecy both for the JFK murder and the UFO issue, and their purported interconnection, is interesting. If state secrets or a modern political organization were not at stake, why the hold up to release information about JFK? Everyone mostly already believes it was the CIA, a group we have shown capable of organizing assassinations of many foreign leaders, and recently (2016) was caught meddling in a US domestic election. The UFO issue can be the motive to cover up the JFK murder for so long, so deeply. And the less obvious, more subtle "can of worms" argument, that if the US Government lied and hid the facts about JFK, of course - everything else including the 9/11 investigation would be open for re-investigation. This is another reason for waiting for so long because there"d be no one to "blame" as those who orchestrated the conspiracy / cover-up would all be dead by now (or so the thinking of this strategy goes).
A recording of radio communications to and from Air Force One on November 22,1963, discovered in 2011, is among the most important new pieces of JFK evidence to emerge in recent years,
The tape, an edited excerpt from a longer recording, captures some of the communications of the leaders of U.S. national security agencies as they learned about the assassination of a sitting president.
I wrote about the importance of the Air Force One tape in the fall of 2013:
This old-fashioned reel of analog tape surfaced at Philadelphia auction house in 2011. The recording was found in the estate of the family of Gen. Chester Clifton, a military aide to JFK. Clifton died in 1991. His children put the estate up for auction.
Bill Kelly, a JFK researcher, enlisted Primeau Forensics, a Michigan audio engineering firm, to produce a cleaned-up version of the tape.
What is significant in this piece of information, as far as data analysis is concerned, is the source. It was an unclassified transcript of a non-essential to the JFK operation (Project Environment). It only "suggests" through information via what was said and not said, and as such, is not a "smoking gun". But much like the UFO phenomenon, in a similar thread - it seems that it"s simply IMPOSSIBLE to keep such a high profile operation secret for so long. The analogy to the UFO issue is Dr. Steven Greer"s "Disclosure Project" available at www.disclosureproject.org; in summary:
Beginning in 1993, I started an effort that was designed to identify firsthand military and government witnesses to UFO events and projects, as well as other evidence to be used in a public disclosure. From 1993, we spent considerable time and resources briefing the Clinton Administration, including CIA Director James Woolsey, senior military officials at the Pentagon, and select members of Congress, among others. In April of 1997, more than a dozen such government and military witnesses were assembled in Washington DC for briefings with Congressmen, Pentagon officials and others. There, we specifically requested open Congressional Hearings on the subject. None were forthcoming.
These materials are, as you can now discern, only the tip of the iceberg of what we have recorded on digital videotape. That is, from over 120 hours of testimony by over 100 witnesses we transcribed only 33 hours and then further edited materials down to a fraction of that amount. Moreover, the full archive represents the testimony of only 100 witnesses of the more than 400 identified to date. The edited testimony will be appearing in book form. A portion of it appears in The Disclosure Project Briefing Document and only small excerpts and summary bios of testimony appear in this Executive summary. We hope in the future to secure funding for a 5-6 part broadcast quality video documentary series to be made from the videotaped testimony we have as the impact of hearing and seeing these witnesses speak is very moving.
This then brings me to my last point: The witnesses who have given testimony to date are extraordinarily brave men and women - heroes in my eyes - who have taken great personal risks in coming forward. Some have been threatened and intimidated. All are risking the ever-present ridicule that attends this subject. Not a single one of them has been paid for his or her testimony: It has been given freely and without reservation for the good of humanity. I wish to personally thank them here and extend to them my personal, highest respect and gratitude.
This summary is focusing on the testimony of important first-hand witnesses. We have thousands of government documents, hundreds of photographs, trace landing cases and more, but it is impossible to include them in a summary of this length. These materials will be made available for any serious scientific or Congressional inquiry.
These 2 issues are interrelated on so many levels, it"s only fitting that both have strong nonclassified, civilian groups dedicated to identifying, collecting, archiving, sorting, and classification of all relevant information on the topics. They are after all, significant issues, with implications on all sciences. These 2 topics may even be more important than recent scientific discoveries. For example, as hundreds of high level government witnesses have testified in the disclosure project, one of the technologies kept under lock and key by the CIA (as reverse engineered from ET) are several energy technologies including but not limited to "zero point" energy which would literally, instantly end our dependence on oil, coal, and nuclear. This is just the tip of the iceberg, as hundreds of ground breaking tech has been leaked from ET such as thorium "clean" nuclear technology, Kevlar, nanotechnology, advanced long distance energy communication, the ability to manipulate space time (or at least, to pass through a "wrinkle" in time), and hundreds of others. The business element of this provides a solid motive alone, without religious, social, or political implications. There would be no need for 90% of the Fortune 500, the stock market would crash and the entire economic system as we know it would be immediately restructured (who would pay for gas when free energy is available?).
The public stated reason, for locking away the JFK files for 75 years, which plausibly is also the reason of keeping UFO information secret; is that the public "cannot handle the truth" - that it would be "too much to handle" - the first implication being some embarrasing political facts, such as the fact that the CIA with the help of insiders like LBJ were critical to the murder or completely organized it themselves. But that"s not hard to swallow, generations of hardened Americans watching real-time cameras on missiles bombing and maiming brown people (mostly) have become desensitized to such emotional dribble. But the elephant was in the room all along - this "shocking" fact really is shocking, because it would change every aspect of life on our planet - quite literally (not figuratively). For example, having free energy would change manufacturing, transportation, computing - just about everything. It would change war, it would have implications into governance, we can skip religious implications and take the lead from the Catholic Church who is ahead of the information curve on this issue (for obvious reasons).
There is a lot of new evidence, much of which has been referenced in the below documentary - we chose this as an example because it was likely overlooked during the sweep of evidence hiding.
So there we have it, the JFK murder has been solved.
WHO - It was a sub-set of the Intelligence aparatus, MJ12/CIA under the direction of Allen Dulles operated by Jesus James Angleton, involving multiple CIA agents including but not limited to George H.W. Bush Sr.
WHAT - The murder of John Fitzgerald Kennedy (JFK) US President, Elite leader, representative of the powerful Kennedy clan, Irish Catholic, father, patriot, and civil servant
WHERE & WHEN - Dallas, Texas November 22, 1963
HOW - A fine tuned machine prepared the ultimate kill scene, which involved extensive research and planning, significant funding, resources, highly skilled and trained soldiers, and a "cover-up" scenario which had to involve LBJ and others around JFK.
WHY - To maintain the big Illuminati secret - that the US Government has obtained technology from other worlds, given to us directly and reverse engineered, and this transfer of tech continues to this day - and that the revelation of what happened to JFK regarding the UFO issue would start a chain of events that would finally lead to the complete disclosure of this technology, and thus - change the entire global political and economic system forever.
Part 3: JFK to 911 Everything is a Rich Man"s Trick
This is a well documented detailed documentary that simply connects the dots between JFK and 911, and basically exposing the "pattern" of such events, we can include the recent shootings in Las Vegas to the long string of such events. Some call them "false flag" operations or "PsyOps" but really they are no more significant than your local pest control guy planting nests of ants and roaches near your home when business is slow. Since World War 2 there has not been a serious threat to the United States - and at the same time the US Military "over prepared" for the possibility of going to war with ten planets, so all that needs to be justified. The Military Industrial Complex needs an enemy, it doesn"t matter if the enemy is Russia, or terrorists.. or aliens..
Frank Holmes, CEO of US Global Investors, reported back from the LBMA/LPPM Precious Metals that took place in Barcelona last week. Holmes gave the key note address on Day 2 “Quant Investing: From Gold to Cryptocurrencies.”
According to a thrilled Holmes, his presentation was voted the best – no doubt helped by the topical subject matter – and he was the recipient of an ounce of gold. He went on to relate the views of the conference attendees regarding the relative performance of gold and cryptos should there be (heaven forbid but sadly topical) a conflict involving nuclear weapons.
“Speaking of gold and cryptocurrencies, the LBMA conducted several interesting polls on which of the two assets would benefit the most in certain scenarios. In one such poll, attendees overwhelmingly said the gold price would skyrocket in the event of a conflict involving nuclear weapons. Bitcoin, meanwhile, would plummet, according to participants—which makes some sense. As I pointed out before, trading bitcoin and other cryptos is dependent on electricity and WiFi, both of which could easily be knocked out by a nuclear strike. Gold, however, would still be available to convert into cash.”
Unsurprisngly, the conference attendees gold voted gold as the superior store of value – a view which echoed the recent Goldman Sachs primer on precious metals. Goldman asked whether cryptos are the new gold and concluded “We think not, gold wins out over cryptocurrencies in a majority of the key characteristics of money…(precious metals) are still the best long-term store of value out of the known elements.”
However, there is obviously a difference between a superior store of value and shorter-term upside…and Holmes is far from bearish on bitcoin and other virtual currencies.
One of his observations is, alas, only too relevant for many gold investors that “Because they’re decentralized and therefore less prone to manipulation by governments and banks - unlike paper money and even gold - I think they could also have a place in portfolios. He goes on to aim a couple of blows on Bitcoin’s biggest recent detractors “Even those who criticize cryptocurrencies the loudest seem to agree. JPMorgan Chase CEO Jaime Dimon, if you remember, called bitcoin ‘stupid’ and a ‘fraud,’ and yet his firm is a member of the pro-blockchain Enterprise Ethereum Alliance (EEA). Russian president Vladimir Putin publicly said cryptocurrencies had ‘serious risks,’ and yet he just called for the development of a new digital currency, the ‘cryptoruble,’ which will be used as legal tender throughout the federation.”
It was Holmes observation on Bitcoin and Metcalfe’s Law that we particularly enjoyed…
Most people are probably (at least vaguely) familiar with Metcalfe’s Law on the economics of network effects. Wikipedia notes “Metcalfe"s law states that the value of a telecommunications network is proportional to the square of the number of connected users of the system (n2). First formulated in this form by George Gilder in 1993, and attributed to Robert Metcalfe in regard to Ethernet, Metcalfe"s law was originally presented, c. 1980, not in terms of users, but rather of ‘compatible communicating devices’ (for example, fax machines, telephones, etc.). Only later with the globalization of the Internet did this law carry over to users and networks as its original intent was to describe Ethernet purchases and connections.[The law is also very much related to economics and business management, especially with competitive companies looking to merge with one another.”
This was Holmes’ take:
“Metcalfe’s law states that the bigger the network of users, the greater that network’s value becomes.
Robert Metcalfe, distinguished electrical engineer, was speaking specifically about Ethernet, but it also applies to cryptos. Bitcoin might look like a bubble on a simple price chart, but when we place it on a logarithmic scale, we see that a peak has not been reached yet.
Holmes is not the first to link Bitcoin with Metcalfe’s Law. For example, the Journal of Electronic Commerce Research published a study earlier this year. As TrustNodes reported
“The study measured the value of the network based on the price of relevant digital currencies and compared it to the number of unique addresses that engage in transactions on the network each day, according to the abstract. The results show that ‘the networks were fairly well modeled by Metcalfe’s Law, which identifies the value of a network as proportional to the square of the number of its nodes, or end users,’ the study says…The application of Metcalfe’s law towards transaction numbers specifically has long been suggested, with a fairly strong correlation between the price of digital currencies and their transaction numbers observed over many years. Ethereum, for example, was barely handling 20,000 transactions at the beginning of the year. Now it manages nearly 300,000 a day. Likewise, price has risen some 10x during the same time period. The reason for this relationship is fairly intuitive. As more projects build on ethereum, more users find it useful as there are more things they can do with it, which in turn makes ethereum more useful for new projects as it allows them to tap into more users. The same can be said about merchants. As more of them accept eth for payments, more think eth can be useful for everyday things, which means more merchants want to accept it to tap into the increased number of users, so forming a virtuous cycle. Metcalfe’s law of network effects can be applied to developers too, or investors, including speculators. The more that use it, the more useful it becomes, with the reverse applying too. The fewer individuals that use it or the more that stop using it, the less useful it becomes.”
If that was his killer chart, however, this was perhaps his killer comment.
“Bitcoin adoption could multiply the more people become aware of how much of their wealth is controlled by governments and the big banks."
This was among the hallway chatter I overheard at the Precious Metals Conference, with one person commenting that what’s said in private during International Monetary Fund (IMF) meetings is far more important than what’s said officially. We have a similar view of the G20, whose mission was once to keep global trade strong. Since at least 2008, though, the G20 has been all about synchronized taxation to grow not the economy but the role government plays in our lives. Trading virtual currencies is one significant way to get around that.
