All Episodes
Previous Next
May 26, 2017 - Clif High
26:08
may 26 2017 wujo - cryptos no bubble, temporal markers
| Copy link to current segment

Time Text
Okay, oops, okay, tea all over.
I can't help it, guys.
I drink hot tea all the time.
In my formative years, I spent too much time among the heathen, the British, in the middle of summer hot tea, you know, so you go along with it.
Anyway, it's May 27th or 26th, excuse me, Friday.
It's probably around, let's just say, noonish.
I don't check the time frequently.
But this is a video on why I know cryptos are not in a bubble and a few other bits and pieces of stuff.
So there are several ways to know when a bubble is happening.
One of the ways is to be able to track money flows into it and watch them expand and see where they're coming from.
And then you can determine sort of a why, what's motivating them.
Another way, in my case, is to watch the linguistics in this cloud that are associated with temporally in time, associated with the rise in prices.
And so when I do that and look at the linguistics, I'm able to get a little bit more discrimination on things than you might find just following the money in.
But even so, even without the linguistic hints, these days, people that follow the money into the cryptocurrencies understand what's going on.
It's called capital flight.
And it's where people with real wealth are tired of seeing a bunch of bozos manage the nominal currency that that wealth is stored in.
In this case, dollars and Euros and so on.
And so the people that own the real wealth, that have worked all their lives, and some really hard, tough sons of bitches, are tired of seeing a bunch of know-nothing, never had a job academics mismanage everything.
And so, and they're somewhat concerned, these people with wealth.
And so what they do, it's a natural sort of a thing.
You know, you're Mr. Wealthy Don in Italy, you know, several thousand years back.
You're sitting there with the wife in the late afternoon.
You've just had your dinner.
It's nice.
It's pleasant.
And all of a sudden there's this big noise.
And your wife says, well, hey dear, what's that?
And so you get up, you're going over to the door and you open up the door of the house and look out past the little patio area there and then come on back and tell her, well, it's nothing to be concerned about.
Rome just fell.
And that's where we're at now.
See, there's this historical context to things that people with a lot of money are able to sit down and see, basically, because they're not trying to, they don't have to bust their butt all day long just to stay alive.
They've got the leisure to sit back and see with a far view as to what's developing.
And so they're able to say, okay, Rome just fell.
Now what do we do about it?
Because, you know, Rome's big.
It takes a long time to actually crash.
And so we're still in that long time.
But the guys have seen that Rome has no more, the Roman Empire has no more legs under it.
And so one of the things that they do is they say, well, maybe I shouldn't be buying all of those garlic futures for next year's crop.
Maybe I should put my money into, you know, long store stuff like wine, you know, or buy that real estate in Pompeii that we always wanted.
Get the money out of our debased currencies.
And that's really what's happening now.
It's called capital flight.
It always occurs at the end of an empire.
We can go back and look at the most recent, easily tracked empire death, which would be the death of the British dominance of the global financial system through trade that persisted through the 1800s, established long ahead of that, actually was established definitively with the sinking of the Spanish Armada, or the defeat.
They didn't all get sunk.
And that definitively established the British dominance and then it lasted for well over 100 years.
Someone I'm sure will tell me the exact number.
And then The British started debasing the currency via ill-advised ventures in promoting opium into China, got themselves involved in the opium wars, shifted their production off of other kinds of things, and then also meddled in the colonies and caused this thing called the civil war here, or the war between the states, depending on where you're located.
And so the same kind of things happen repeatedly.
In that period of time, the pound sterling was, silver was the denominational currency globally, and it didn't lose its value, the actual sterling, but because of the debasement and the trade and so on, you were able to watch the capital inflows drain out of existing businesses and through a transition period come into new businesses, and that's where we're at now.
And if you track the same kind of linguistics, the same language that was used then about money and about what's going on now, you can tell that the cryptos are not in a bubble yet.
I agree that someday they may be in a bubble, but a bubble requires a very certain set of conditions to exist.
One of those conditions is a level of what we have to call saturation.
And we have zero saturation to speak of on cryptocurrencies across the planet.
We also have to acknowledge that saturation depends on the size of the market.
So if you've got a market of you and your six friends, you can have a bubble occur with four of the people in those six other people.
And so a bubble can form very rapidly in a small group.
We're in the situation, though, where our total market, our total audience for cryptos is the planet.
And so most of the planet has never even heard of cryptocurrencies.
Yet a sizable chunk of the planet does not own a cell phone.
So until this latter condition is not true anymore, until most of the planet actually, in terms of humans, until they actually own cell phones, we cannot possibly be in a crypto bubble because there are many people yet to hear of it.
And so you define bubbles by how money flows into them, how the money reacts, and then sort of the pop and then the deflation.
We're still in the inflation of what is going to be a very large traditional bull market, but it's also a wealth transfer that's occurring.
The wealth transfer is occurring because the fiat currencies, the paper currencies, which are now all digital anyway, such as the dollar, you hardly ever touch a dollar and you just deal with it as a digit on your PC or in your credit card.
So you're touching plastic the whole time and you never actually touch currency anymore.
So basically we're in a paperless system now, a currency-less system.
And so our currencies being digital, we now are at a point of demonstrating as we the people, we all of the populace, demonstrating Gresham's law.
Gresham had this idea that, well, if I got a sack of shit and I got a sack of gold and I offer to pay you in either one of them your choice, we know which one you're likely to choose.
And he called it good money chases out bad.
And so gold money chases out shit money.
Manure is good, but not for money.
And so that's what we're finding.
You know, dollars are probably good, but not for money.
And so money requires something that you can store wealth in.
Cryptos are going to grow over time as the entire planet becomes a digital hive insofar as our currency transactions between each other are concerned.
The cryptos will continue to grow and the process will cause or will be caused by the flight of individuals out of their local currencies.
So my local currency is the U.S. dollar and I don't trust the Federal Reserve as far as I can kick their ass.
These people are stupid.
And so not trusting them, I don't want to hold much of my money in the dollar.
It's stupid.
So I don't.
I'm going to get as much as I can into cryptos and just let it sit as money so I can use it and it doesn't degrade.
Now, the fact that it grows, that's good, but it's not my goal.
For other people, it is.
For younger individuals, it is.
For myself, it's just, you know, basically the fact that it doesn't degrade.
I can still spend the stuff and still get things for it the way I expect to, not with the dollar.
For some older people who don't have time to save for retirement, small investments in cryptos, in individual cryptos, could turn out to be very profitable and perhaps Life-altering, but you got to be careful and you got to understand what you're doing.
And if you don't understand it, don't do it.
There's no such thing as doing cryptos half-assed.
Okay, there's no such thing as doing cryptos casually.
So you just got to understand what you're doing and make sure that all of your stuff is backed up, that you print out your public and private keys and never share them with anybody.
You keep those things and you store them.
You put them out on good quality paper, not paper that's going to rot.
Or you can write them out on paper with high-quality ink and then store that paper in a bank if you wanted or some safe or a safety deposit box.
It means nothing to anybody else.
It's just a string of numbers.
Now, you know, a savvy crook at some point might tumble to the fact that this is a crypto.
And some crooks are indeed savvy.
But this is yet another reason I know we're not in a bubble, okay?
In a bubble, everybody knows about what's going on.
And so you get a bubble in stocks, and your barista is handing you your morning drink and also trying to give you stock advice.
That's when you know it's time to get out of the stock market.
Everybody's got an opinion on it.
It's in its maximum point of saturation.
We're nowhere near there.
You know, you can walk down a street in the United States.
In some streets, this wouldn't be true at certain times of the day, but in most streets, it would probably be true if you just walked down those streets and asked the first hundred people you saw if they'd ever heard of cryptocurrencies or Bitcoin.
You'd probably be surprised at how few actually know anything about it and how few know anything accurate about it.
So under the circumstances, no bubble.
Just the beginning of what we're going to call hyperinflation because the capital that's all now over here been stolen by all these asshole bad guys is going to leak out of that into cryptos.
And they don't control cryptos and they're freaking out over it.
So things are going to get a little weird as we get moving.
And so this is how I know we're not in a bubble.
It's all the language about it.
You know, my barista does not know about Bitcoin.
My bankers don't even know about Bitcoin.
I had to tell them what it was.
You know, these are the people that I write my checks on, that kind of thing, right?
I take my EM50.
I'm out in the backyard now because the EM50 is over in the shop.
I did well enough in the cryptos that I got a present for the EM50.
I'm getting all that rid of all that 40-year-old running gear and replacing it with new cool stuff.
New transmission, new front end, new steering, new pumps for the engine and all that kind of stuff.
A tune-up on the old 454, new rear end, and I got new wheels for the whole thing, right?
So it's all safe.
It's going to be skookum.
And then as soon as it's done here, I'm going to get in and redo all the electricity, replace all the wiring, and that sort of thing.
Oh, I know why I got off on that.
I'm going to use lithium-ion, by the way, and do away with some aspects of the old design and put some solar panels.
It's going to be really cool.
Solar is good today, but usually it's not up here in the Northwest.
In any event, though, the reason I brought that up was I take the EM50 over to the, I mean, just laterally, in a direct shot here, it's probably, I don't know, maybe three miles.
But it's on another one of these points out here in Puget Sound.
I take it over to McLees Autos, right?
It's a shop of motorhead kids.
And I say kids because they're all under 40.
But they've got a rack big enough to lift up the motor home and they're really cool.
Nice guys.
They're not going to let their ignorance of a particular procedure stop them.
They go online, they learn, they talk to the people that did it the first time, etc.
And so they're really good guys to have you to do your motorhome or other work, I'm sure, as well.
Anyway, though, my point was, one guy in the shop of seven had heard of Bitcoin.
One guy in a shop of seven had no knowledge of it.
The word had passed, it had stuck, but he didn't have any real grasp or understanding of what it was.
And that's in my town here.
Now, I don't get out very much, so my experience is somewhat limited.
But so far, in the people I've asked in Olympia, I've encountered two people that knew what Bitcoin was.
And this has been over the past couple of years.
So now I'm certain that's accelerated somewhat because some of my relatives are involved with it, but I think they're involved with it because they saw me getting involved with it.
But in any event, so we're nowhere near the bubble stage yet.
Yes, we will get there when horse dealers in Mongolia are trading crypto suggestions with their cousins in Kazakhstan.
And when that happens, yeah, okay, I would agree that at that point the price appreciation levels were in a bubble.
Until then, I wouldn't worry about it.
What I would worry about is things like people trying to steal my Bitcoin, you know, make backups of my stuff electronically.
You can back up onto a phone with the little memory cards that are really cheap you put in there, you know, copy over your Bitcoin wallet and then copy it, then take that little chip out and store it somewhere safe and put another one in there to be active with, so on.
So be safe about it, you know, practice smart crypto.
It's a mean, rough world out there, and you got to know where your towel is.
Okay, so that was the primary business today.
It's hot.
I'm going to get done here real quick.
Very rare for us to have hot.
This is our ninth day without rain since last September.
Nine days only without rain since last September.
Really a tough winter on everybody around here.
We've all got cabin fever all ready to bust out and do something.
And spring was two months ago.
We should have had planting and that kind of stuff going on and it was all slogging, miserable, wet.
We're in an ice age, but that wasn't my point.
What I wanted to bring up was these things called temporal markers.
If you follow my stuff on Twitter, you'll see me use the TM.
I don't mean transcendental meditation.
I mean temporal marker.
I usually put it in caps because I'm not referring to a trademark or anything, okay?
I'm talking about a temporal marker.
Now in my work, everything is done in sets.
We use what's known as fuzzy set theory.
It's a particular weird kind of mathematics.
And so in a fuzzy set, there's associations within sets.
And as the associations prove themselves valuable, then you have a tendency in my line of work to have more and more confidence in the other members of that same set.
It's just the way that universe has played out here repeatedly, so I've learned this process actually works.
So if I've got a set with 100 items in it, and I see that 15 or 20 of them pop up, boom, boom, boom, boom, boom, just as they did when they were appearing on Model Space, then I say, oh, those 15 or 20 are pretty good indicators.
They're pretty good temporal markers.
As we go along, each one is a marker in time.
They're pretty good temporal markers for the rest of the stuff in the set to show up.
And usually that's correct.
Now, it's never ever 100%.
So if we had 100 items in that set and the first 15 pop up, maybe we'll get as high as 30 or 40 of those markers actually, of those items all actually showing up pretty much close to the time we suggested.
And that's pretty good for us.
So I say that in my line of work, about 38% is my threshold for declaring something fulfilled, right?
The language, most of the language that we were forecasting, or most of that 100%, or 100 items, for our viewpoint, is 38%.
Because we never achieve 100%, our realistic goal is down around in 70s or so forth.
So if we get about half of 70, we're pretty good.
Now, here's the deal.
A temporal marker is a unique, identifiable, forecastable event in the future that is then associated with a larger set of other items.
And so a temporal marker need not be within that set, but could be.
So a temporal marker for cryptocurrencies might be a particular price in Bitcoin.
And we would say, okay, from this point on in our model space, as all these temporal markers appear, the price in Bitcoin, if it hits this point on this date, aha, good temporal marker.
And then from that point, the rest of these things ought to show up.
But we don't usually get that kind of thing because we don't usually get numbers on specific dates.
What we might get, though, is something that's really weird, okay, which is why I call it woo-woo.
It might be such that we have a set that shows Bitcoin and it shows a number, and we don't really have a date.
But what we do have when we move model space along is some other stuff that's going to happen just ahead of that stuff with Bitcoin.
And this other stuff could be really weird.
It could be a crash of a dirigible.
I'm just pulling this out of the air, right?
Or it could be the sudden appearance of some absolutely unknown thing relating to fashion or a different kind of new technology or something.
Totally unrelated to the Bitcoin, just for whatever reason, or rather for the reasons included in our processing, ends up associated with that within this set of data elements that we're examining.
And so the processing dumps all this stuff in there and then we go in and examine it and we get to the point where we say, okay, we've had 15 or 20 out of this group of 100.
Within this group of 100 is Bitcoin at this particular level of numeric value.
And we think it's going to be in this particular date range because of the way these things line out in model space.
And thus we give you the date range.
And we're usually right, there's a slop over, okay, about three days either way, because we're working with what we call immediacy data, data that's going to get here, pop into existence, and then expire very rapidly.
So, all this brings us back to temporal markers.
I've had some personal temporal markers appear in reality, manifest.
They were out of the blue kind of things, hadn't expected them, been looking for them for several months now, and they indeed have appeared.
And so, that particular set, that group of sets that was associated with those temporal markers from about four or five months back, with its first appearance about a year back, those sets are probably going to show up as being very valid.
And a couple of those sets include, two of those sets include our plunge into the pool of hyperinflation from this point forward, from the appearance of all of these temporal markers forward.
Well, we're in the hyperinflation now because we've got all of the money, capital flight, trying to leave all of the stolen areas in the 1% and go into cryptos or something they feel will be safe over time because they've seen the hyperinflation of values within their own wealth.
So, in other words, if you buy a painting for $100 million and you see some other painting that was theoretically below yours in value being sold for a higher amount, you're going to start getting a little sketchy, not about what you can sell yours for, but about the worth of that stuff that you're going to have to sell it for at that point.
These people are more concerned with preserving purchasing power through time than numbers.
And so, the numbers, I think, are rather shocking to them, and they're getting a little freaked out.
And so, we're seeing this acceleration of capital flight into the cryptocurrencies.
Now, I have the temporal marker associations for these number of personal temporal markers.
Now, by personal, I mean they're ones I don't share for any number of reasons.
They may involve celebrity names, they may involve personalities, they may involve people playing or acting in particular roles that I don't want to intrude on their privacy, but I know that, oh, this is going to show up, therefore, hey, I can use it as a temporal marker.
And I put these things down and just keep note of them.
We've had these two very strong ones show up, totally unexpected to me.
I'd basically forgotten about them.
The triggers popped up on the database and flung them up to my attention.
It's like, uh-oh, went back and checked the original sets, and there we go.
We're now going to be officially into our hyperinflation period, and here's the rub.
We're going to have a really rough summer.
Big crocodile teeth up and down in the cryptocurrencies as money flows in and out.
Because it can't, it's like there's a required oscillation for funds.
It's like AC current.
You can't shove all of the current electricity, that much electricity straight through the copper because it gets resistance until it stops.
And then the wire burns out and melts.
So, you just go it in and let it back, go it in, let it back.
And it's just this oscillating flow.
That's the kind of thing we're going to be going into with the cryptocurrencies.
That's what creates these crocodile teeth I keep talking about in the charts.
I don't know their official term in chart talk, but they look like crocodile teeth, especially if you look at it as a jawline that goes up with bigger teeth getting, you know, with the teeth getting larger and fiercer in the back.
As that occurs with each and every tooth, there's going to be a gap following behind the tooth, and that gap will also get bigger and slightly wider as we go along.
By bigger, I mean deeper in the trading range, and by wider, I mean it'll be a little bit longer.
A few more days will be spent in that trading range as we go through each of these.
And so, some people that are new to cryptos, thinking it's in a bubble, are going to think the bubble has popped.
Some people that are new to cryptos that have never been through this are going to puke their guts out and fall over in a dead faint.
Some people new to cryptos are not going to understand what's going to happen here, and so will sell at the wrong times because they'll panic, and they'll sell when the price is dropping.
Always sell into strength, okay?
Never sell when the price is dropping, always sell when it's rising.
And that basically will sort of save you, I think.
I mean, that little metric.
Now, this is going to happen to Bitcoin, this is going to happen to Ethereum.
It's going to happen to all the cryptocurrencies, this business, the crocodile teeth.
Some of the teeth on some of the other alts are going to be a lot higher than we see on Bitcoin because of the FOMO, the FOMO, the fear of missing out.
That factor is going to play into this.
That's why a lot of people think it's a bubble, is because of that anxiety, because of that building tension, as we call it.
Those emotions create a hardness in the gut.
Oh, oh, I can't miss out.
Anxiety, you know, stress, that kind of thing, right?
And so that is very much associated with a bubble.
But we don't have any of the other conditions for a bubble.
We just have that one indicator, this anxiety, and it's all based on FOMO.
I can't miss out.
I've got to get in on this.
So under the circumstances, no worries, people.
That's why I was saying, you know, drink some tea, calm yourself, back off on the caffeine, stay decaffed while you're doing this.
Guard yourself against bad reactions as we go through this period.
Because we're at the very beginning of this huge influx of the capital out of one system into the new system as the old system dies.
It's the greatest wealth transfer ever in history because it's planet-wide.
It's going to be bigger than when Tamujin, Genghis Khan, the Mongol, swept down and conquered all of Arabia and took all of their gold and everything.
It's going to be bigger than all of the gold being taken from the populace of Europe by the Germans and then taken by the U.S. This is bigger than any of that because it involves the entire planet.
It'll take a long time to go through.
So patience is required in order for fortunes to be made.
And this is probably the one time in history, the very one time in history, that it will be true to say that we have great fortunes being made without there first being a great crime.
▲
Export Selection