The Real Reason Why Bitcoin Is Soaring

And what to do now… [The Freeport Navigator logo]( [The Freeport Navigator logo]( October 21, 2024 [More Articles]( | [Free Reports]( | [Premium Services]( Publisher’s Note: Over the next few weeks, we will be updating how we send your product fulfillment emails for The Freeport Navigator. Our goal is to help you better identify and categorize these subscriber-only emails. To prepare for this change, we suggest adding our new email address to your contact list: From Name: The Freeport Navigator Email: services@exct.thefreeportsociety.com Thanks for your continued support as we make these updates. If you have any questions, you can [contact Customer Service here](. Please note, some email filters and algorithms may deliver our emails to your spam or junk folder - if this happens, just move our emails to your primary inbox folder. [The Real Reason Why Bitcoin Is Soaring]( Bitcoin is closing in on its all-time high. After climbing 55% this year, the world’s first cryptocurrency now trades at $68,517. That’s about $5,000 below its all-time high of $73,835 on March 1. And this month alone, bitcoin is up about 9%. We’ve held bitcoin in [The Freeport Investor]( model portfolio since we launched the service in November 2023. So far, subscribers who acted on our recommendation to buy are up 64%. And we expect even bigger gains to come. As we’ll explore today, bitcoin is, above all, a hedge against a weakening dollar. And as Washington continues to rack up trillions of dollars in new debt, more and more people are looking for protection. First, let’s look at some of the other factors behind bitcoin’s recent ascent… SPONSORED [America’s ‘Silent Invasion’ Is YOUR Town in the Crosshairs?]( Time is short to prepare. [Click the map to find out what happens next](. Crypto Capital of the Planet Some of the recent rally reflects Donald Trump’s improved electoral prospects. According to Election Betting Odds, which aggregates information from major markets, Trump has a 57% chance of winning the White House. That’s up from a 48% chance of winning at the end of September. This is the man, after all, who has pledged to make America the “crypto capital of the planet.” He’s also promised to establish a strategic crypto reserve not too different from the gold held at Fort Knox. The Fed’s pledge to keep cutting interest rates also be a factor. The lower rates go, the more “risk on” the markets tend to get. Also, bitcoin doesn’t pay out any income. So, when rates are high, capital tends to flow into higher yielding assets. Bitcoin was born in the zero-rate environment that followed the 2008 meltdown. Some of its greatest moves have happened when the Fed was in ultra-dovish mode. Or maybe the animal spirits were reawakened by the announcement that Sam Bankman-Fried’s bankrupt FTX crypto exchange has finally been cleared to start repaying its customers. But as I mentioned up top, bitcoin is and always will be a dollar hedge. Whether Trump or Kamala Harris wins on November 5, the underlying trends undermining the dollar won’t change much. SPONSORED [Eric Fry “This has changed how I view the Markets”]( I’ve been working in financial research for over 40+ years but nothing has changed how I view the markets, [more than this. Get the details here](. U.S. Interest Burden at 28-Year High Don’t just take my word for it… Yesterday, Bloomberg ran the following headline: “U.S. Interest Burden Hits 28-Year High, Escalating Political Risk.” It’s talking about the interest the federal government pays on its outstanding debt. According to the report… The U.S. debt interest-cost burden climbed to the highest since the 1990s in the financial year just ended, escalating the risk that fiscal worries limit the policy options for the next administration in Washington. Since when have fiscal worries slowed down Washington? We’ll just borrow more, right? Uncle Sam already owes $36 trillion. What’s a couple trillion more among friends? Well, maybe. But that’s getting harder now. The U.S. Treasury paid $882 billion in net interest payments during the fiscal year ending in September. That’s an average of $2.4 billion a day in interest payments. And that works out at more than 3% of annual GDP. Let’s break that number down further. Uncle Sam’s budget deficit is about 6% of GDP. About half of that is current spending. The other half debt service. And a 6% budget deficit is something generally only seen in times of war or deep recessions, when tax payments fall and the government boosts spending to stimulate demand. Well, we’re not fighting a war right now. And last I checked the economy was growing at a brisk 3% clip. The reason our budget deficit has blown out – and the reason this is all but impossible to fix – is that half of the budget deficit is going to pay the interest on prior years’ ill-advised spending. If our government were to balance the primary budget tomorrow – and odds are better of you winning the lottery – we’d still be looking at deficits of 3% of GDP due to interest expense on existing debts. So, to really balance the budget, we’d need a budget surplus of 3% of GDP. And even that wouldn’t pay down the debt. It would simply cover the interest payments. Inflate or Die This is the hole our leaders have dug us into. Neither Trump nor Harris has a viable plan to get us out of it. Both have pledged to find extra-large shovels to dig us even deeper. The only way those debts get paid down is in dollars that have been deeply depreciated due to inflation. It’s inflate or die for Uncle Sam. This is why bitcoin, gold, and other dollar hedges are core, long-term holdings for us at [The Freeport Investor](. And it’s why you should keep some in your portfolio, too. As the value of the dollar continues to inflate away, dollar hedges will continue to climb. To life, liberty, and the pursuit of wealth, [Charles Sizemore's signature] [Charles Sizemore's signature] Charles Sizemore Chief Investment Strategist, The Freeport Society Manage your account We hope this timely investment research is valuable to you. As you know the markets move fast and conditions change frequently. So please check the current issue for the most recent advice. Please note that we cannot be liable for any missed bulletins caused by overzealous filters. To ensure that you continue to receive this valuable part of your service please take a moment to add support@thefreeportsociety.com to your address book. You can reach us at support@thefreeportsociety.com or by calling 1-800-539-8213. Have a question about your bill? [Visit our billing FAQs](. Too many emails? Click or tap [manage my subscription]( to unsubscribe from free newsletter emails. [Freeport Society icon]( [Freeport Society icon]( The Freeport Society 1125 N. 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