Musk will head the newly-created White House advisory office named D.O.G.E.
The title references both the Texas-based techno icon’s affection for Dogecoin and abbreviates as “Department of Government Efficacy”.
DOGE Aims to Whip Inflation Now
We either fix this or go de facto bankrupt
— Elon Musk (@elonmusk) December 26, 2024
The magnetic tech expert has frequently offered advice on various topics including technology, business, and public policy to both former and potential future President Trump.
His proposals to enhance government effectiveness might assist in reducing excessive spending in Washington D.C., limiting the expansion of the federal budget shortfall, and controlling escalating prices caused by inflation throughout the economy.
As a crypto investor, I’ve noticed that excessive government spending can lead to inflation. This is because it boosts the speed at which money circulates in the economy, making prices climb higher. Additionally, when the Federal Reserve creates new dollars to lend to banks for purchasing government debt, this dilutes the value of the dollar and further fuels price increases.
A Princeton University economics study suggests that around 30% of the inflation experienced from 2021 to 2022 in U.S. dollars can be attributed to the budget deficits incurred during 2021.
The escalating costs stemming from substantial government expenditures initially surface in financial markets, eventually causing price increases that are felt across various sectors of the economy. This can lead to higher prices at fuel stations and supermarkets.
New Headwind for Bitcoin’s Price, Musk Warns
As a researcher, I find that when dollar inflation is addressed effectively, the cost in US dollars required to acquire cryptocurrencies tends to decrease, assuming all other factors remain constant.
What matters is the ratio of dollars to crypto.
— Elon Musk (@elonmusk) January 7, 2025
In the realm of cryptocurrencies, the impact is particularly striking. This can be clearly observed in the fluctuation of prices for leading coins like Bitcoin, Ethereum, Ripple (XRP), Solana (SOL), and Dogecoin (DOGE).
Indeed, numerous cryptocurrency investors prefer holding digital assets such as Bitcoin, Ripple, and Dogecoin over traditional dollars, as these crypto assets are seen as a protective measure against the erosion of value due to inflation.
As a crypto investor, I’ve noticed an interesting trend: Over extended periods, like four years, my Bitcoin investments have significantly appreciated in terms of their purchasing power, while the value of the U.S. dollar seems to be losing its ability to maintain its buying power parity due to inflation. However, it’s important to note that not all experts share this viewpoint about Bitcoin acting as a hedge against dollar inflation.
However, Musk cautioned through a Twitter discussion on Tuesday that if the Doge’s agency initiatives prove effective, it could create resistance to Bitcoin’s price increase, rather than fostering its growth.
As a researcher, I find that a reduced deficit and decreased inflation rates tend to moderate the overall rise in prices, encompassing conventional financial sectors such as stocks and innovative digital markets, for instance, Bitcoin.
On Wednesday, the value of Bitcoin dipped down to $94,600 following its fall from the $100,000 level it had held the previous day.
Read More
- SUI PREDICTION. SUI cryptocurrency
- „People who loved Dishonored and Prey are going to feel very at home.” Arkane veteran sparks appetite for new, untitled RPG
- LDO PREDICTION. LDO cryptocurrency
- Destiny 2: A Closer Look at the Proposed In-Game Mailbox System
- Clash Royale Deck Discussion: Strategies and Sentiments from the Community
- Jennifer Love Hewitt Made a Christmas Movie to Help Process Her Grief
- ICP PREDICTION. ICP cryptocurrency
- Naughty Dog’s Intergalactic Was Inspired By Akira And Cowboy Bebop
- Critics Share Concerns Over Suicide Squad’s DLC Choices: Joker, Lawless, and Mrs. Freeze
- EUR IDR PREDICTION
2025-01-09 07:58