It’s time to pay attention. Ray Dalio, Conspiracy Theorists, Gold Bugs, Bitcoin Maximalists and even the all have one thing in common. They believe that the existing Global Financial System is in for a paramount change in the near future. Chinese Government , the Founder of Bridge Water Associates, has been trying his best to alert the broader market about this coming major change. He has been on the , media stations and even went as far as releasing an for free just to warn others about the imminent paradigm shift. Ray Dalio biggest global stages entire book Recently, he was at the , where he was quoted saying: 2019 Institute of International Finance Annual Meeting I think we are in the last stages of the cycle where we ask: What is currency? What is a reserve currency? How does our fiat monetary system work? A major change is coming, are you prepared to navigate the Big Debt Crisis? One of the most major changes in recent history was the end of the and the which saw the United States Dollar turn into a in 1971. Overnight, the United States Dollar went from being backed by the world’s largest Gold reserve to being paper, backed by trust in a central authority. Bretton Woods System Gold Standard Fiat Currency The United States government has since shown an unquenchable appetite for debt as can be seen by the following chart. United States Government Debt The United States is not the only guilty one, as nearly all global economies have been on a debt binge during the past 50 years which can be seen by the following chart. Global Credit-Market Debt Owed Typically once excess levels of debt are reached, economies will experience a . This can come as a Beautiful Deleveraging or a Bubble Burst depending on what are deployed. deleveraging monetary policy tools During his , Dalio explained that Monetary Policy Tool #1 — the lowering of interest rates — is no longer effective because interest rates are already near zero. These near zero interest rates can be seen in the chart below. talk at the IIF 10 Year Government Bond Yields He further expanded saying that Monetary Policy Tool #2 — the printing of money (and ) — is also unlikely to have a meaningful effect due to our current economic climate. While using this tool used to have tremendous positive effects, it’s now akin to “pushing on a string”. quantitative easing The United States Dollar has seen its value (purchasing power) drop substantially since turning into a fiat currency, which can be seen in the chart below. Purchasing Power of the US Dollar Ray Dalio believes that we need a for the coming . He states: Monetary Policy Tool #3 and a new Modern Monetary Theory (MMT) paradigm “in paradigm shifts, most people get caught overextended doing something overly popular and get really hurt. On the other hand, if you’re astute enough to understand these shifts, you can navigate them well or at least protect yourself against them.” He believes the coming paradigm is likely to be categorized by near zero interest rates, the aggressive printing of dollars and . debt monetization This should cause any intelligent investor to take a good look at their existing portfolio allocations and if left unchanged, feel very uneasy with the prospect of these things coming true. In this new world, Dalio mentions that “storing one’s money in fiat currency and bonds will no longer be safe. Bonds are a claim on money and governments are likely to continue printing money to pay their debts with devalued money. That’s the easiest and least controversial way to reduce the debt burdens and without raising taxes”. He further explains that Digital Currencies will be of much more value and that “holding cash in a vault” is seemingly archaic. While most people will think Bitcoin, even Ray Dalio has been quoted saying: “Bitcoin could be like the blackberry phone, you could have Ethereum come along and everything change” These comments and the coming paradigm shift perfectly aligns with the creation of an entirely new financial system. Welcome to Ethereum and the new Open Financial System. This open financial system has a new at its base layer. This new money, known as (ETH), will continue to gain value over the US Dollar due to . native money Ether superior monetary policy ETH is Money — www.tradingview.com This financial system is open to all global citizens regardless of nationality, age, race or gender. It provides many of the same luxuries you would see in the traditional financial system with things like access to , , , , , , , , and even . Credit Stocks Commodities Bonds Gold Real Estate Stable Coins Exchanges Insurance Identity Systems An internet connection is all you need to access these services. Source: www.TheBlock.com One of the greatest benefits of this new open financial system ( ) is complete transparency. The existing financial system allows banks, financial institutions, and regulators to control the flow of information, causing cataclysmic events like the . Open Finance 2008 financial crisis These entities choose what information gets disclosed to the public. It’s not like you can walk into your bank and say, “I’m here to perform an audit.” Things are different with , which makes all the data publicly available on-chain for everyone to see. Transparency and real time data are two major advantages Open Finance has gained by rebuilding things from scratch. If you are interested in tracking Open Finance activity, head over to , and . Open Finance DeFi Pulse DeFi Prime ETHHub We are at the very early stages of this new global financial system and it’s likely it will see growing pains as it matures. Rest assured that a and a are doing their best to ensure the world has a new, more fair and accessible way to conduct their financial activities. legion of dedicated developers thriving community If you are interested in learning more or have any questions, feel free to reach me on twitter . @iDecentralized

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Global Debt, Ethereum, and a New Open Financial System [Analyzed]

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Anthony Bertolino

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Global Debt, Ethereum, and a New Open Financial System [Analyzed]

Too Long; Didn't Read

Anthony Bertolino

About Author

TOPICS

THIS ARTICLE WAS FEATURED IN...

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