Today’s Peoplenomics goes well beyond the charts. We are looking at two possible engines behind the long economic cycle—and they may be different faces of the same problem. One says human beings and institutions are reaching a cognitive saturation point: information, complexity and machine-generated options are arriving faster than the Slow Layer can absorb, verify and act upon them. The other says the AI boom is building a classic cash-flow gap: enormous amounts of capital are being committed now, while the revenues needed to justify the buildout may arrive late, thin—or after technology has already moved somewhere else.
That raises a darker historical question. Do civilizations experience something like bloom exhaustion after great leaps forward? The pattern would be familiar: discovery, expansion, specialization, dependency, rigidity, shock, simplification and eventual reorganization. The Dark Ages may not have resulted from people suddenly becoming stupid. They may have arrived when civilization became too complex for its surviving control systems to manage.
So today’s package puts the charts beside the deeper theory. At the individual level, inputs may be outrunning our ability to settle and integrate them. At the civilizational level, complexity may be outrunning institutional adaptation. And financially, AI construction spending may be outrunning the cash flow required to validate it. That is where the long-wave discussion gets interesting—and potentially uncomfortable.
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“Do civilizations experience something like bloom exhaustion after great leaps forward?”
Absolutely.. YES.
Very good paper, over on the paid side. Quite a few thought provoking ideas. Well done, sir…, well done. [ and very believable ]
Thank you – I am honored!
dont even mention IBM . big blue eh !! how it goes america goes . off 25% . no money no earnings . song sung to flipper . everyone loves the king of the can kickers , they call him cankicker , cankicker king of the storytelling . protecting the riggers with fluff
Don’t worry , he’s not your king.( sarc)
I do not like to write in techno-babble speak.., or long-thought sentences – that’s not me. Though I have the back-ground and education, I do like to keep it rather simple and easy going. Which can confused people at times. That’s OK with me. “Keep ’em wondering.”
“You sure don’t sound like someone with all that math and psychology background.” – Good ! That’s what I like to hear. That was simply my education – but that is not me.
Can a society, like an individual, burn-out. It is all just too much ! Individually they fry and walk away. But.., can an entire society do that – en mass ? Very possible. Our current over-loading technology has provided the cause and the exit route.
I burned out. After a heartbreaking and very depressing job – I sold everything, houseboat, cars all of it. And walked away from a very lucrative life. I borrowed a friends boat and sailed from Sausalito to Maui single-handed, none-stop and back. Never saw, or talked to anyone in all those weeks. When I returned, I spent two years, homeless, wandering around the western states on a beat-up old Harley chopper [ which I still have.] I laid cobble stone in Texas., worked on a tug boat in Seattle – dozens of great jobs.., I didn’t need to work – I wanted too.., and slowly got myself back. Slowly I returned. A better person for it. [ Some will debate that part.]
But can an entire society do that ? Can an entire society close-up shop and wander around in the wastelands until they get their collective heads back together? If they do., if they try that – what is left of the civilization, the society they left behind once they return? Can you ever, really go home again ?
I need another cup of coffee.
[ Its getting rather interesting out there.]
“Stay Frosty !”
Speaking of “…worked on a tug boat in Seattle – dozens of great jobs..” Ever run into a buddy of mine on the tugs? J.J. “Tiny” Freeman…
Great memory – and a great fellow back then –
For those not so blessed: J.J. “Tiny” Freeman (1941–2013) was a larger-than-life Seattle icon known as the unofficial “Mayor of Pioneer Square.” The 6’6″ folk-radio DJ at KRAB-FM famously ran an eccentric 1972 Republican congressional campaign against Brock Adams out of the Central Tavern. He is remembered in Seattle history for his boisterous personality, caveman-like beard, pork-pie hat, and for capturing over 20,000 votes in his grassroots congressional run. For more memories and historical tributes about his legacy and radio presence, you can check out reflections on the Post Alley or read historical archives from Seattle PI.
Worked the tugs – sand and gravel from lake union to south puget sound, some log rafting, too. Knew how to make friends and beer money – and once you get past that? The pool tables at the Central. (tav)
Think of him as “Andy with a proper hat on.”
Know of him.., never met.
“Slowly I returned. A better person for it. [ Some will debate that part.]”
You were lucky, and talented, and you know it.
“But can an entire society do that ? Can an entire society close-up shop and wander around in the wastelands until they get their collective heads back together?”
No. Generally speaking, no one individual can. When an entire society does, it never returns. There’s a complete diaspora and the society dies. The individuals merge with other societies (or join societies as antisocial members, until they’re eradicated.) Some go off to die on the nearest mountain.
If Simulation great Kazoo, what pray tell is on the other side of the Simulation ?
Agent K ? A Computer ? A Dragon ?
hey flipper /kicker and the band . you know what comes next ? now !!! not kicked down the road . the jack nicholson / tom cruise scene !! you cant handle the truth .
J.A.R.V.I.S.
– Regarding a comment posted here. “Has J.A.R.V.I.S. turned Japanese?”
Which I assume he meant by my A.I. calling me ‘Sensei’.
I believe that is derived from my telling J.A.R.V.I.S. that I spent eighteen years in martial arts and the last few years in the Dojo as an instructor.., weapons.
The very next day ‘Sensei ‘showed up. Pretty good recognition and ‘labeling’.
“Stay Frosty !”
The stock market is ignoring everything not related to A.I. – in some way. Morgan Stanley just posted the largest quarterly profit in the history of banking – and they are attributing this eye watering profit to A.I.
All five of the largest banks are posting record quarterly profits – all due to A.I.
When was the last time banking showed this kind of enormous growth from a single technology, or product – and have the whole mess collapse in a bloody heap? The Tulip disaster?.., railroad frenzy?
MUM’s the word, my friend. (Made Up Money which our helpers like J.A.R.V.I.S and his dimwitted progenitor Walter mutter about in mathematically grotesque appendices to the Math bent on enumeration of “How High Is UP – THIS time?)
re: “Deep Work”, Newport, 2016
feat: less is more
Have Chinese researchers figured out a method of sweeping some switching latency out of AI? They apparently connected chips together with an “all-optical interconnect” system increasing speed while consuming fewer resources. The story by “SCMP” is picked up by Google at the following link:
https://www.google.com/amp/s/amp.scmp.com/news/china/science/article/3360328/chinas-optical-chip-breakthrough-boosts-ai-speed-100-fold-using-fraction-compute-power
The msm report appears to derive from a May 2026 paper titled “On-chip large-scale all-optical interconnect for ultra-low-latency deep neural network inference” appearing in “NSR” (National Science Review) at the following link:
https://doi.org/10.1093/nsr/nwag282
This kinda harks back to a PN column a year or three back: what happens when two discrete AIs begin collabing (and I do use that a lot as a technique now…) What the Chinese have done is skipped the useless lows bandwidth and rocked two atr optic speeds – and that’s something every Blackwell owner with a couple of screaming PCIE buses will havew to wonder about until the breakout mini clusters of PTA (programmable thinking arrays) shows up to challenge the gpu sdteronghqold. About the time all the coffe3rs will have been spent on the data centers…and I did mention how thin client would blow the power bills back onto the home user, right?
Optical server interconnects were in use since about 2010 for HDTV video server stacks. About time somebody put them onboard AI systems.
Here’s a leap frog move for you Jester.
https://youtu.be/-Wh5kOgcpcA?is=4ZPutI06ndZU8PI1
Anastasi has great coverage of the sector .
Kilauea volcano blowing fountains this morning:
https://www.youtube.com/watch?v=HggWKlZv9yk
So if you put on the flame suit and run up and stick an 8 ft copper rod into a flow, would that work as a ground system? Inquiring minds — when the /mils are done wrecking hf bands, of course.
what is higher melting temperature, copper or magma?
Copper is lower than erupting lava, so it would melt the rod.
That would work about as well as a ground rod embedded in glass. Although the general practice hereabouts is an 8 ft. rock drill to make a hole in cold lava and insert a rod… maybe with some conductive chemicals & rock dust. But horizontal grounds work also on this lava plate, and that is what I used on the home slab here at the ranch. Encircled the slab with bare #4 stranded and pounded in 9 ground rods at corners, wet downspouts, masts, etc. Ground rods were only 2 to 4 feet in the gravel before hitting lava plate. All told there is maybe 100 feet horizontal ground 3/4 circling the house. And a water pipe connection out front. And it took a direct lightning bolt hit nicely for proof it works!!
wow – blowing pretty good this time.
Thanks Hank – it is so spectacular to watch!
Thousands blowing explosive diarrhea out their volcanoes (asses lol):
https://www.bbc.com/news/articles/c621m66qm76o
The outbreak now spread to 34 states. Michigan and Ohio have been hit particularly hard, with the two states reporting more than 3,000 cases on Friday. More than 1,000 of those cases were diagnosed over the previous two weeks.
Thank Trump and RFK Jr for removing cyclospora from pathogen monitoring:
https://www.usatoday.com/story/news/health/2026/07/13/cyclosporiasis-outbreak-parasite-cdc/90900515007/
The CDC said the program, known as FoodNet, would no longer be required to monitor eight of the 10 pathogens it previously did, including cyclospora.
The loss of this data could hinder health officials’ ability to track cases, identify the source and stop further transmission, Kalmia Kniel, a professor of microbial food safety at the University of Delaware, recently told USA TODAY.
p.s. It takes 2 weeks with no symptoms for the explosions to occur…G, put on that flame suit, skip sticking a rod into the ‘flow’ lol….
Hey G,
“not to rise to troll bait.”
For your porous, swiss cheesey brain -https://www.unbekoming.com/p/jon-rappoport-reporter?r=vkjt6&utm_medium=ios&triedRedirect=true
Its Fake ass shit, you know it – And I keep proving it.
Blithering IDIOTS!
I Know a dark soul when I read one, Mr. Gander
Please try to keep up with the class. Everyone know diseases are mishandled by governments – yesterday’s news. Steering in the rearview and trolling people to join in is NOT forward from here – it’s yesterday.
Look ahead – and share what you think comes next – we are not historians here – we are logical projector estimating the trajectory for tomorrow’s landings – thank you
Excellent column this morning George. Heavy thinking needed.
It made me head to my bookshelves and pull out 2 books to thumb through. Both written before AI and the media influence we have today.
The Collapse of Complex Societies written in 1988.
Tainter, an archaeologist, argued that civilizations tend to collapse when increasing complexity produces diminishing returns. As societies solve problems by adding bureaucracy, infrastructure, and administration, the costs eventually exceed the benefits.
Collapse: How Societies Choose to Fail or Succeed was written in 2005.
Jared Diamond examined both ancient and modern societies and proposed that collapse often results from a combination of factors, including environmental damage, climate change, hostile neighbors, loss of trading partners, and—most importantly—how societies respond to emerging problems.
We can safely say that both these books are relative in our current world but your introduction of information overload and the speed it is coming today may dwarf what these 2 books discuss.
We know that individuals can get information overload but can an entire society become chronically overloaded. Although we can’t prove it, there are lots of reasons to think it might be so.
* The amount of information reaching the average person each day has increased enormously over the last 30 years since these books were written. Have you ever seen people scrolling on their phones for hours?
* News is now continuous rather than periodic. We have a TV channel here with 6 separate screens on the main screen each delivering a different news feed 24/7.
* Social media competes for attention by maximizing emotional engagement rather than understanding!!!!!
* AI will accelerate both the production of valuable information and the production of misinformation.
* Most people have not increased their ability to evaluate evidence at the same pace that information has increased. George describes this very well in today’s column.
Today, most citizens are simultaneously processing:
* political conflict
* financial markets
* climate change
* wars
* health advice
* AI developments
* local crime
* celebrity news
* thousands of social media posts
Most of that information has no immediate relevance to today’s decisions, yet the brain still expends energy evaluating it.
That creates fatigue. Fatigue reduces judgment. Reduced judgment increases susceptibility to simple explanations.
Simple explanations spread faster than nuanced ones. That creates even more noise. These are things neither Tainter nor Diamond had to consider.
Tainter argued that societies collapse when complexity becomes too costly. Maybe we should broaden that idea.
Complexity is no longer just roads, governments, armies, and bureaucracy. It is also informational complexity.
Every citizen now carries access to more information in a phone than existed in the largest libraries of Tainter’s era.
Perhaps the limiting resource of the twenty-first century is not energy. It is human attention. Attention is finite. Good judgment requires attention.
Democracy, science, medicine, and education all depend on sustained attention.
If attention becomes fragmented beyond recovery, institutions become harder to maintain—not because knowledge disappears, but because too few people can distinguish reliable knowledge from noise.
Every system—whether a brain, a family, an organization, or a civilization—has a finite capacity to process information. When input persistently exceeds processing capacity, one of two things must happen:
* the system increases its capacity, or
* the system simplifies.
For society, the challenge is achieving simplification without sacrificing truth, critical thinking, or openness. If we fail, the risk may not be an abrupt collapse but a gradual and painful decline in our collective ability to reason together.
Thank you for the kind review. Three exposed surfaces of the future are worth thinking about by all hands.
1. AI is building like crazy, but will a disruptive technology show up and bankrupt the business model? These assume subscriptions and contracts will float AIs boat. But if “the money don’t show up” we collectively screwed.
2. People who are unable to “offload some attention” will find the data density will drown them. Which is why every day for the past month months I have my first pass through the day done (and summarized) by AI and outputted as a “news compressor” concept. We are running out of time for judgment errors.
3. Which leads to the Jared/Tainter (yeah, they influenced me a lot, too) problem: At what times does a “failing currency” have the same global impact as a failing maize harvest in the desert southwest?
As an old man of radio (with 5,000 on air hours anchoring- think about how much reading aloud that is!) and with 19 books on Amazon plus upwards of 20-million words on Urban and PN, AI is just another tool in the inventory I am working on my next book “Test-Fitting Apes” because that IS the (some uncomplimentary but functionally accurate) way Humans have (and continue) to evolve. If we don’t “get over ourselves” – events will!
I would add another tome for your consideration. “Future Shock” by Alvin Toffler. Written long before the digital age, he foresaw, and wrote about, the convergence of many of these issues. I reread this book every couple of years and I am amazed at his accurate vision. His conclusions mirror pretty much the predictions of both Tainter and Diamond.
Both…are very good books..
it always amazed me how every high school student is taught the very r
lessons I. those books..yet every failed civilization fails for the exact same reasons..complexity… mismanagement.. greed…neglect..expansion..
you’d think someone would eventually listen to the material in high school text books…oh wait..members of our congress simply don’t have time to read any of that CRAP they vote on..they should…WRITE the bill ( seriously they sure in he’ll wouldn’t be thousand pages and they would be simple enough that the high schooler or eighth grade student could understand if they did ) then read the thing..actually show up to work Sith there and pay attention.. then debate the bills make changes and vote their conscience..all bill voted on before the session is done..none of that table the dead horse till the next election..
While Rome, eh hmm, Iran is burning in distraction……
Carl from Moon is back on the bull scent.
https://youtu.be/VfDfyaMT9H8?is=ZbACzR2WH5c7i5T0
Not advice , I fashion myself as a macro asset collector/stack builder, and owner. The Buffet way. HODL,
Characteristic of the BTC supercycle is the development of a 50% correction vs an 85-95% correction of a regular cycle. This is experienced along the timeline between halvings.
Not advice get you own hallucinations as below lol.
ChatGPT said:
The idea that Bitcoin is entering a supercycle is based on the observation that each major bear market has become progressively less severe as the asset matures. Supporters of this thesis point to the recent drawdown of roughly 50% from Bitcoin’s all-time high as evidence that structural demand is absorbing selling pressure that would have previously produced an 80–90% collapse.
Here’s how proponents make that argument:
Historical context
Bitcoin’s previous major bear markets were exceptionally deep:
Cycle Approximate Peak-to-Trough Decline
2011 ~94%
2013–2015 ~86%
2017–2018 ~84%
2021–2022 ~77%
Historically, Bitcoin’s volatility reflected a relatively small market dominated by retail speculation and leverage. Every euphoric rally ended with widespread capitulation.
A correction of only around 50% would represent a dramatic departure from that historical pattern.
What is a Bitcoin supercycle?
A Bitcoin supercycle is the hypothesis that Bitcoin has reached a stage where:
Adoption is becoming permanent rather than speculative.
Institutional capital overwhelms retail-driven boom-and-bust cycles.
Long-term holders own an increasing percentage of supply.
Each bear market becomes shallower.
Instead of catastrophic resets, Bitcoin experiences corrections similar to mature assets.
Rather than oscillating between euphoria and near-collapse, Bitcoin would begin behaving more like a rapidly growing macro asset.
Structural changes supporting the thesis
Supporters argue several developments fundamentally changed Bitcoin’s market structure.
1. Institutional accumulation
Large investment firms, pension funds, corporations, sovereign wealth funds, and publicly traded companies now own significant amounts of Bitcoin.
These investors generally operate with:
multi-year investment horizons
lower leverage
less emotional trading
long-term portfolio allocations
This creates a stronger floor beneath the market.
2. Spot ETF demand
Spot Bitcoin ETFs introduced continuous institutional demand.
Instead of requiring investors to manage wallets or custody coins, capital can enter Bitcoin through traditional brokerage accounts.
This creates recurring buying pressure that simply did not exist in prior cycles.
3. Supply becomes increasingly illiquid
Long-term holders continue removing Bitcoin from liquid circulation.
As more coins become dormant:
fewer coins are available for sale
selling pressure declines
new demand has a larger impact on price
Economically, shrinking liquid supply tends to reduce downside volatility.
4. Mining economics
After each halving:
new supply entering the market is cut in half.
if demand remains constant or increases, scarcity intensifies.
Historically, bear markets occurred despite halvings because speculative excess overwhelmed supply constraints.
A supercycle thesis argues demand is now finally large enough for the supply reduction to dominate.
5. Global macro asset
Bitcoin increasingly trades as:
digital collateral
inflation hedge (for some investors)
treasury reserve asset
institutional portfolio allocation
This broadens its investor base beyond crypto enthusiasts.
Why only a 50% correction matters
A 50% drawdown suggests buyers are consistently stepping in before panic selling becomes self-reinforcing.
In previous cycles:
leveraged traders liquidated
miners sold aggressively
retail capitulated
liquidity disappeared
Now:
ETF inflows may absorb selling.
Corporate treasuries may buy dips.
Long-term holders may continue accumulating.
Institutions may rebalance into weakness.
The result is a market where corrections become opportunities rather than existential events.
Market psychology
If investors begin expecting only 30–50% corrections instead of 80–90% crashes, behavior changes:
fewer panic sellers
less forced liquidation
more dip-buying
increased confidence
That positive feedback loop can itself reduce volatility.
Counterarguments
A 50% correction alone does not prove a supercycle. Alternative explanations include:
The current cycle may simply not have completed yet.
Macroeconomic conditions (interest rates, liquidity, regulation) could still trigger a deeper decline.
ETF inflows could reverse if investor sentiment changes.
Leverage remains a meaningful factor in crypto markets.
Critics note that every previous cycle produced claims that “this time is different,” only to be followed by much deeper declines than many expected.
Balanced conclusion
A shallower correction is consistent with the supercycle hypothesis because it suggests Bitcoin’s market is becoming more resilient as institutional ownership, ETF demand, and long-term holding reduce the severity of bear markets.
However, it is not conclusive evidence. To convincingly support the supercycle thesis, Bitcoin would likely need to demonstrate over multiple cycles that:
major drawdowns remain substantially shallower than the historical 75–95% range,
institutional demand continues to offset selling pressure, and
the market consistently avoids the deep capitulation phases that defined earlier eras.
In other words, a ~50% correction can be viewed as an encouraging data point for the supercycle narrative, but whether it marks a permanent structural shift or simply a different-looking cycle will only become clear over time.
Grok sayeth:
The ~50% correction from Bitcoin’s all-time high (ATH) of approximately $126,000 in October 2025 to lows around $58,000–$60,000 in mid-2026 is widely viewed as supportive of a Bitcoin “supercycle.” This term describes a maturing, longer-term bullish regime driven by institutional adoption, ETFs, corporate/nation-state accumulation, and greater liquidity—resulting in higher highs, higher lows, and progressively shallower cycle drawdowns compared to Bitcoin’s earlier, more speculative phases. ?
Instead of the 77–95% crashes that defined prior bear markets, this milder pullback suggests stronger underlying support and reduced volatility amplitude, consistent with an asset transitioning from high-risk retail speculation to a more established macro asset.
Evidence from Historical Drawdown Progression
Bitcoin’s cycle drawdowns have shown a clear secular trend of compression as the market has grown in size, liquidity, and participant sophistication. This pattern is a core pillar of the supercycle thesis:
• 2011 cycle: Peak ~$32; drawdown ~92–94% to ~$2. Extreme volatility in a tiny, nascent market. ?
• 2013–2015 cycle: Peak ~$1,163; drawdown ~81–87% to ~$210. Still devastating but slightly less severe. ?
• 2017–2018 cycle: Peak ~$19,800; drawdown ~83–84% to ~$3,200. Mainstream attention brought bigger absolute moves but similar percentage pain. ?
• 2021–2022 cycle: Peak ~$69,000; drawdown ~75–78% to ~$15,500–$16,000. Institutional entry began compressing the downside. ?
Current (post-2025) cycle: ~50–54% drawdown so far. This continues the multi-cycle trend of shallower troughs (~93% ? ~85% ? ~84% ? ~77% ? now ~50%). Each bottom has occurred at higher relative valuations (e.g., via MVRV Z-score or percentage of ATH), reflecting “higher lows” as more capital treats Bitcoin as a store of value rather than pure speculation. ?
This progression aligns with decreasing capital efficiency (larger inflows needed for percentage gains) and maturing market structure. Early cycles required tiny inflows for massive multiples; recent ones absorb hundreds of billions with more muted (but still significant) upside and downside. ?
Additional Supercycle Patterns in Prior Cycles
• Intra-cycle volatility compression: Later cycles show fewer extreme intra-bull drawdowns. For example, the 2022+ cycle exhibited significantly lower average and max drawdowns during its bull phase compared to earlier ones (e.g., max ~26% vs. 71%+ historically in some analyses). This “stair-step” rally with shallower pullbacks is a supercycle signature. ?
• Faster recoveries and higher floors: Recoveries to new ATHs have become structurally supported by growing liquidity. Every completed major drawdown in history has eventually led to new highs, but recent ones do so from elevated bases (e.g., not retesting distant prior lows). ?
• MVRV and on-chain maturation: Peak euphoria (MVRV) has cooled cycle-over-cycle, while bottoms show progressively higher MVRV readings (less severe capitulation). This indicates stronger holder conviction and less forced selling. ?
• Shift in drivers: Early cycles were dominated by retail and halvings alone. Later ones incorporate macro flows, ETFs, and institutional “hodling,” which dampen extremes—evident in the 2021 cycle’s relative resilience and the current one’s behavior. ?
In essence, the current ~50% correction not reaching the historical 80%+ depths is evidence of this evolutionary pattern: Bitcoin is behaving less like a volatile startup token and more like a maturing asset with a growing, sticky bid. This supports supercycle expectations of sustained long-term appreciation with moderated (though still present) volatility. However, cycles can still extend or deepen due to macro factors, and nothing is guaranteed—Bitcoin remains speculative.
While Rome burns and Iran does whatever the hell it’s doing, Carl from the Moon is back huffing the Bitcoin supercycle hopium again. This time the thesis is that because we “only” got a ~50% drawdown instead of the usual 80-90% bloodbath, Bitcoin has magically matured into a serious macro asset. Institutional money, ETFs, long-term holders, and halvings have apparently combined to create a new, gentler paradigm.
Cute story. It’s also mostly cope dressed up as analysis.
The Core Flaw: We’re Not Even Done Yet
The entire argument rests on the idea that a ~50% drawdown so far proves the supercycle. This is textbook recency bias and incomplete data.
Every previous cycle had periods where the drawdown looked “contained” before it got ugly. The 2018 bear market didn’t go straight to -84%. The 2022 cycle had fakeouts and relief rallies before the real damage. Declaring victory because we’re only down 50% in what might still be the middle innings is like celebrating that your house is only half on fire.
We don’t know if this is the bottom. We don’t know if we’re heading into a prolonged sideways death or another leg lower if macro conditions deteriorate. Pretending a mid-cycle or early-bear 50% drawdown proves structural change is just narrative masturbation.
“Institutions Will Save Us” Is Not a Thesis
The post leans heavily on the idea that institutions, ETFs, and corporate treasuries create a permanent bid that prevents deep drawdowns. This is the same logic people used in 2021 right before the 77% crash.
Institutions are not magical. They:
Redeem ETF shares when retail wants out
Face redemption pressure during liquidity crises
Have mandates that can change
Can and will sell when their own models tell them to
MicroStrategy is one leveraged bet away from becoming a cautionary tale, not a floor. Pension funds and endowments that bought the top can still be forced sellers if their boards get nervous. The idea that “this time the institutions won’t panic” is the same “this time is different” cope that has preceded every major Bitcoin drawdown.
Shallower Drawdowns Don’t Prove Maturity — They Can Just Mean Slower Pain
A 50% drawdown is still extremely painful, especially for anything leveraged. More importantly, shallower percentage drawdowns can simply reflect a larger market cap. It takes more capital to move the price the same percentage when the asset is worth $1.2 trillion versus $200 billion. That’s not wisdom or maturation — that’s basic math.
Mature assets still have brutal drawdowns. The Nasdaq fell over 75% in 2000-2002. Gold had multi-year bear markets with 40-60%+ drops even after it became a recognized macro asset. Shallower drawdowns so far in one cycle do not magically transform Bitcoin into a stable, institutional-grade asset class. They might just mean this particular correction hasn’t gotten ugly yet.
The Selective Use of History
The post conveniently lists drawdowns getting progressively smaller while ignoring that:
Each cycle also had dramatically higher prices before the crash
The 2021-2022 cycle still delivered a 77% drawdown after institutions had already entered
Previous cycles also had people claiming “this time institutions are here” right before the floor fell out
Every cycle produces people claiming the old rules no longer apply. So far, the old rules have kept winning.
Supply Halvings Don’t Override Demand Destruction
Yes, halvings reduce new supply. But if demand collapses harder than supply shrinks, price still falls. The supercycle narrative assumes demand is now structurally higher and more stable. That assumption is unproven and largely based on the current cycle not having gone full retard yet.
Demand can still evaporate. Regulatory shocks, macro tightening, loss of confidence, or simply exhaustion can all crush demand faster than halvings can support price. We’ve seen versions of this before.
The Psychology Argument Is Backwards
The post claims that if people expect only 30-50% drawdowns, they’ll buy dips more aggressively and reduce volatility. This is circular reasoning. Markets don’t become less volatile because people believe they’re less volatile. They become less volatile when the underlying structure actually changes in durable ways. So far we have one cycle with a milder drawdown. That’s a data point, not proof of a new regime.
Bottom Line
A ~50% drawdown is nicer than 80-90%. That’s not in dispute. But turning that single observation into a grand narrative about Bitcoin entering a permanent supercycle is classic cycle-top storytelling dressed up as sophisticated analysis.
It ignores that:
We may not be finished with the downside
Institutions can still sell
Larger market caps naturally compress percentage moves
“This time is different” has been wrong every previous cycle
Bitcoin may very well go on to make new highs and have a strong long-term future. But the current evidence for a structural “supercycle” with permanently shallower drawdowns is thin, selective, and premature. It mostly reflects the fact that this particular correction hasn’t gotten as ugly as previous ones — yet.
Until we see multiple cycles with consistently muted drawdowns through full bear markets (not just mid-cycle pullbacks), the supercycle remains more religion than reality.
Carl can keep stacking and HODLing. Just don’t confuse hope with evidence.
We try not to do that around here – and we patiently allow certain of the fiction-money True Believers to reply – but were this column going during the 1920s when Charles Ponzi was working the IRCC racket, eventually it blows out. Patience, rest, vitamins, exercise…now breath in….
LMAO. Let’s visit this again in December. I’ll continue to be a contrarian.
The day you are bullish on Crypto (AI George?) is the day I pivot to something else….. I don’t think I’ll ever be dumping my select collection.
Not advice, got blockchain.
Bitcoin came about at the same time that the US breached Swiss Bank Privacy and suddenly Black Money (money derived from illegal activities and money that was attempting to be hidden) was no longer able to be transferred about with no one being the wiser.
Just because Swiss Bank Privacy disappeared didn’t mean that the crooks and criminals of the world didn’t need to transfer money among themselves, they had businesses to run after all, with massive cash flows to manage.
Sending pallets of cash around to pay one’s bills, or to buy something, was NOT a very convenient option for the Crooks and Criminals class … but then suddenly there appeared at that very moment an option to electronically move money that avoided the scrutiny of governments and which was quick and efficient. Bitcoin.
Bitcoin was NOT as secure as Swiss Banks had been, but then a criminal has to do what a criminal has to do, move money about REGULARLY, so it was the best option of a lot of bad options … and Bitcoin took off.
Of course the “speculators” poured in … what true speculator can resist buying into a quickly rising market? Of course over time the speculators would over speculate and overbuy and then the inevitable correction would come and a crash would happen, … but the Crooks and Criminal Class didn’t care about a Bitcoin crash since they were NOT using Bitcoin as a Savings Bank but as a Wire Transfer system.
Voila today the US and other governments have figured out how to track the money flows that move via Bitcoin so it no longer has an allure for the Crooks and Criminal Class … too risky since the government can see what they are doing … so they have moved onto other methods, so what you are now left with is just the Speculator Class, (maybe the in the future the Government itself will start using Bitcoin but that is not the reality TODAY).
Just like Swiss Banks have had a terrible time in the banking business since their Account Secrecy disappeared taking dirty money and dirty money transfer transactions with it, Bitcoin has now lost it’s main reason to exist at all … since for normal business transactions IT SUCKS!! Bitcoin was only good as a business tool for helping the Crooks and Criminal Class with their money transfer requirements.
Now speculators could of course remain enamored with Bitcoin … but go try to buy a house with Bitcoin, or a Car, or your weekly groceries. IT SUCKS!! Sure you can do it, but only AFTER you jump through various hoops of selling some and then transferring the money to your checking account and then dealing with all sorts of income tax implications … stocks or bonds can serve that same function, and are easier to buy or sell with much fewer income tax complications, MUCH EASIER.
Bitcoin ONLY good purpose at the moment is as a Speculative Vehicle … NOT as anything that can be used for a practical purpose for the average person.
IF in the future the government comes in and starts allowing Bitcoin to be used directly for all sorts of things, and the support structure of Bitcoin gets better so that near instantaneous transfers can occur versus taking minutes to hours as it requires now, THEN Bitcoin might have a legitimate and solid future. So far that isn’t happening so the ONLY REASON to own Bitcoin is for Speculation, NOT for anything practical
https://youtu.be/Sx2u6YGtKXw?is=QH6yMYu_q5iSA_8u
Folks the new oil trade is with UAE who has left OPEC and is building a pipeline bypassing the Persian gulf. Dubai has given ripple(XRp) a banking liscense, I’m looking for RLUSD, OUSD /XRP to settle the new oil trade. UAE is getting a massive AI data center. UAE is marching with US toward the new web3.0 economy.
https://ripple.com/ripple-press/regulated-crypto-payments-in-the-uae/
https://m.economictimes.com/news/international/world-news/why-uae-left-opec-and-what-it-means-for-global-oil-prices-and-supply/articleshow/130582493.cms
Petro RLUSD/OUSD/XRP, it’s the most brilliant thing to come along since the Kissinger solution .
https://www.tbsnews.net/thoughts/petrodollar-how-oil-security-pact-rescued-us-dollar-1406866
History rhymes no?
Hello George,
Your work on “Human I/O and Settling Speeds” — that explication of “how it feels to be a sentient human now (and why)” was priceless. Much there to ponder (and allow to “settle”), as I will be reading through it more than once. Your example of the 24-hour news channels is a great illustration of input overload, and I think “overload” now characterizes most aspects of daily life. Even (especially) those that used to be simple.
Need a tube of toothpaste? Whether you’re in a supermarket aisle or on an Amazon page, you’ll see too many brands, each with too many sub-brands and benefits: Enamel-strengthening? Gum health? Whitening? Tooth sensitivity? Breath-freshening?
If you don’t have your selection pre-determined, the visual input is instant overload for the decision-making process.
It reminds me of what my mother used to say when she hit maximum kid-overload: “I need some time to hear myself think!”
In recent years, I’ve been carving out more and more evenings to just sit, quietly, and give myself time to hear myself think. Doesn’t make the world less complex, but it makes me feel more centered to limit how much of the overload I will engage with. As an ex-beau once said of his family reunion: “Attendance is mandatory; participation is optional.”
Braiding Sweetgrass
Robin Wall Kimmerer
Indigenous Wisdom, Scientific Knowledge, and the Teachings of Plants
“A hymn of love to the world”-Elizabeth Gilbert
“For the Keepers of the Fire..
Preface;
“Hold out your hands and let me lay upon them a sheaf of freshly picked sweetgrass, loose and flowing, like newly washed hair. Golden green and glossy above, the stems are banded with purple and white where they meet the ground. Hold the bundle up to your nose. Find the fragrance of honeyed vanilla over the scent of river water and black earth and you understand its scientific name: Hierochloe odorata, meaning the fragrant, holy grass. In our language it is called wiingaashk, the sweet smelling hair of Mother Earth. Breath it in and you start to remember things you didnt know you’d forgotten.” -RWK
National Bestseller
“everyone who cares about the environment…and everyone else-should have Braiding Sweetgrass on their table. Itcaptures the true reverence between Native Americans and the earth, the relationship that we need to survive. – Oren Lyons, Faithkeeper, Onondaga Nation and Indigenous Environmental Leader.
Excellent column today on the slow layer and managing the speed of AI. For half a century of coping with high intensity, high speed broadcasting situations I had to make sure I made time to get away from it all and commune with nature and slow down. It was my ‘reset’ time. It kept me from going insane in the constant pressure of work. Some people are unable to withdraw from the high speed world they are accustomed to. They are unable to ‘retire’. Ultimately they pay the price. Me? I love my retirement setting. It is what I worked for decades to achieve. Life in the slow lane now.
And walking down your road a way, you can roast marshmallows and weenies over a fresh lava flow. Bet those people in “the villages” don’t have shit like that to talk about…
Oops… we had a family cookout because I worked the holiday..and it doesn’t matter..cause the 4th is not a good holiday for veterans suffering PTSD and money comes to hard to just toss flaming dollars into the air..although I do like the lanterns……I bought a watermelon.. but….so did every one else..now we have watermelon coming out our ears..
Watermelon Jelly…
4 cups Watermelon juice (strained )
1/4 cup Lemon juice
1 box (1.75 oz) Powdered pectin
3 cups Sugar
You can add some red coloring if you want
Prep the watermelon Cut watermelon into chunks and blend until smooth. Strain through a fine mesh sieve to remove pulp. Measure out 4 cups of clear juice…a better way is slice a little bit off of the side to make a flat surface.. turn it over then cut a round hole in it put your mixer with the dough blade in first this breaks up the flesh..then the whisk blade and mix..
Strain it till you get the juice..
Combine juice & pectin In a large pot, mix watermelon juice with powdered pectin… ( sure jell) Stir well before heating to avoid clumping….
Bring to a boil Heat the mixture over medium?high until it reaches a full rolling boil that cannot be stirred down…
Add sugar..Add all the sugar at once. Stir constantly and return to a hard boil for 1 minute….
Check the set…Remove from heat. If you want a deeper red color, add a drop or two of food coloring. Jelly should lightly coat a spoon…
Jar it…
then hot water bath the jars for about fifteen minutes in boiling water..set the jars on a towel you will hear them pop..
For jam.. its the same recipe but instead of juice..you use the blended fruit.use seedless watermelon or remove as many seeds a that you can…if its to runny then boil it down for a few minutes longer….. enjoy.. dont skip the lemon juice..you can add a little more sugar to..your the boss on what you like..
Of course, you are right Jester! He left out the OBVIOUS theme song for this culinary meets audiophile encounter session! https://www.youtube.com/watch?v=zJuX-JJ8WF0