Europe's Central Bank Just Made the Greatest Mistake

In late September, I posted Alan Turing, Bitcoin, and Economic Liberation to invite you into a conversation about economics, mathematics, AI, Bitcoin, and youth STEM education.

These have been my hot "melting pot" topics for the past year and, in my view, this melting pot has extreme significance for multifamily real estate investors -- especially as I profile my own MSA (metropolitan statistical area) of Kenosha and Racine Counties in SE Wisconsin where Microsoft is now building the mega "AI Factory" datacenters that NVIDIA's Jensen Huang has been talking about for 5 years.

Being focused on the economics, demographics, and innovation of your favorite MSA will only give you more data, connections, and faster decision-power about your next real estate investment, whether it's a 12-unit apartment building or a 120-unit self-storage facility.

Bitcoin for Family Offices

Since that 9/29 post, I published a precision piece for my personal blog titled Bitcoin for Family Offices: I'll Convince You in 500 Seconds.

I was inspired by a recent Citi Private Bank Global Family Office Survey that showed an amazing ignorance of, and under-allocation to, Bitcoin.

My effort to do it in "500 Seconds" was all about the "Shark Tank" approach: if you ever get an audience with VC or UHNW (ultra high net worth), you don't have 15 minutes. And if you don't capture attention in the first 2, you may not get a full 8 (500 seconds) to get to your good stuff.

When you are speaking to a private group that controls $100 million to $1 billion, they definitely don't have time to hear lame pitches. They need quick and compelling arguments, data, and evidence. Otherwise, you have no business taking their time.

I reasoned that I could capture significant attention and interest in the first 8 minutes to either "find my people" who wanted to learn more, or say "here's my number and good luck."

Check out that October 15 post Bitcoin for Family Offices to learn more.

The ECB (European Central Bank) Just Jumped the Shark

So what happened? The ECB published an economic research paper this week that didn't hit the wires until Saturday, thanks to the Twitter/X posts of one of its authors, Jürgen Schaaf @schaaf_jurgen.

I don't know if this Twitter headline is a direct quote from the paper or its authors, but it isn't far off the mark from what you are about to learn...

NEW ECB PAPER: “If the price of Bitcoin rises for good, the existence of Bitcoin impoverishes both non-holders and latecomers."

Then I found the X thread by Meister Jurgen, with this as his #2 post in the thread...

"Even if Bitcoin prices keep rising and the bubble doesn’t burst, the wealth gains by early adopters come at the expense of latecomers or non-holders, leading to significant redistribution effects."

My first response on Saturday: This sounds a bit like “It’s so unfair that thousands of families were able to build dynastic wealth and you weren’t. Rockefellers, Carnegies, Fords, Kennedys, Waltons, and a few hundred other families in the Forbes 400 should feel bad and give it all away now.”

Not surprisingly, many other Twitter/X users joined the fray with arguments about why Google, Apple, Amazon, or Facebook should enjoy economies of scale without central bank suppression. Should we cancel all billionaire visionaries because... it's just not fair?

Just because some savvy investors bought those stocks 10,000% lower, should the rest of us have been discouraged from buying any of the Mag 7 at a $1 trillion valuation so we could profit when they surged to $2 trillion?

The big connection you need to make from this today is that "if it's true" (it is) that the US Gov can continue to finance all new deficits and debt with persistent dollar inflation, then it is gradually changing the game for all global central banks.

They are in trouble. And smart institutional money managers who see this will begin allocatiing more to Bitcoin. Revered investor Stanley Druckenmiller recently confessed how much he regrets selling NVIDIA shares. He may soon say the same thing about not owning Bitcoin.

And even if this ignorant paper/thread from the ECB is "innocent in its ignorance" -- i.e., not intentionally malicious against Bitcoin, per se -- they appear to be part of the problem in the evolution of 21st century digital capital.

They are arguing for economic equity with a classic redistribution of wealth argument. Yet, while numerous European wealth dynasties thrive -- or flee the Continent due to new sovereign confiscation tactics -- it is mosty the little people who are benifitting from collecting BTC in the past decade.

Saylor vs. the ECB: Hope, Liberty, Energy, Security and Innovation Are On the Line

Heck, even Michael Saylor's MicroStrategy (MSTR) has a cost basis for their 250,000 "coins" near $40,000. That doesn't seem like he has an unfair advantage, since it took incredible vision, execution, leadership, and risk to ride the incredible volatility of the past four years. Besides, he did as much to educate the rest of us, since his late "conversion" in 2020, as anyone.

The beauty of Saylor's Bitcoin strategy is that it's a model many different corporations can follow to some degree. He found an "infinite money glitch" in corporate finance that can make many companies outlive their expected termination.

That's exciting and it will be fun to watch over the coming years who joins the revolution. I hope many make their move soon before sovereign central banks catch on as I talked about this summer in Bitcoin: A Strategic Reserve Asset?

Since the ECB paper must have been approved at the highest levels, it means the world's #2 central bank believes their fiat hegemony is at stake with the ascendance of Bitcoin.

Too bad they didn't bring a good argument. Because the one they sponsored just made the case for... running even faster and harder from fiat central!

DM me if you have a FO/UHNW group that wants my Bitcoin Conversion in 500 Seconds presentation. I'll do it via the web, or in-person for the right price.

But no "in-person" for a few weeks as I somehow finished writing this tonight with a massive upper respiratory infection -- pounding sinuses, burning eyes, 1am to 7am brutal headaches, then waking up with eyes "glued" shut. Did a home Covid test that was negative, but need to go to urgent care tomorrow since I've never felt this much pain in my face.

Talk soon,

Cooker