30th September 2021 > > Office of the Comptroller of the Currency.

tl;dr

The nomination for the Office of the Comptroller of the Currency (OCC) is a scary one.

Market Snap

Market Wrap

Treasury Secretary, Janet Yellen, is warning that unless the debt ceiling is raised or suspended, the US will run out of cash on October 18th 2021. That is less than a month away.

Over a year ago, US debt stood at $27 TRILLION. With an annual deficit running at more than $8 TRILLION that total debt is now significantly higher.

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Here is a graphic representation of just $1 TRILLION, not $27 TRILLION:

https://pagetutor.com/trillion/index.html

The moment that bond markets lose faith in central banks’ ability to manipulate the long end of the yield curve, there will financial decimation of all risk assets. This loss of confidence will dwarf the events of the Global Financial Crisis a decade or more ago.

It isn’t possible to predict the timing of that moment – it could still be years away. But you can be very sure it will happen at some point.

Unless that is, Governments start paying down their extraordinarily large liabilities in short order.

And we all know that ain’t gonna happen any time soon.

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By the way, cryptos will get beaten up as much as any other risk asset when this catastrophe happens. March 2020 tells us that.

And no, that day of catastrophe will not mark the demise of fiat.

Occasional Series – the fuel shortages

On hearing that priority for fuel may be given to only ambulance workers and police, Paul Whiteman, general secretary of school leaders’ union NAHT said:

“The last thing children need is a further disruption to education given the experience of the last 18 months”.

My sources confirm he was looking in the mirror at the time.

Curious Cryptos’ Commentary – Office of the Comptroller of the Currency (OCC)

On the 24th September 2021 the CCC reported that the likely nomination of Saule Omarova to be the head of the OCC would be a significantly negative development for cryptos.

Omarova wants to nationalise retail banking, and effectively ban cryptos. Neither of these objectives can possibly be achieved, but she can cause significant harm to the US economy and the crypto cause for the next few years.

As a reminder, Omarova has said she wants to “end banking as we know it” and that cryptos “benefit mainly the dysfunctional financial system we already have”.

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In our favour, the concerns raised by the CCC have fallen on fertile ground. Influential people are listening and taking note. Just after reading the CCC, Senator Ted Cruz said this:

“Not only is Saule Omarova, Biden’s pick to lead the OCC, a threat to our traditional economy, she also wants to regulate crypto into oblivion. Crypto faces future-defining government regulations. This nomination needs to be stopped.”

The same day, 24th September 2021, American Bankers’ Association President and CEO Rob Nichols weighed in with:

“… we have serious concerns about her ideas for fundamentally restructuring the nation’s banking system.”

You don’t say.

Despite the increasingly partisan nature of US politics (and remember, the CCC is always apolitical), it is to be hoped that the confirmation hearing makes the sensible decision to turn down her nomination simply because of the harm she will undoubtedly cause to the crypto revolution.