The expert magazine of Ostrum AM

Currency is an accounting unit, a medium of exchange and a store of value. CBs have monopoly power over money issuance, which intrinsic value is tied to high-quality collateral. Purchases of risky debt securities may have undermined the intrinsic value of currency. The implied devaluation (for instance the US dollar) sparked a reach for alternatives. Whilst gold (+43% since 2018) is a well-established store of value, it cannot be used a means of transaction. Bitcoin (up 402%) is too volatile to be used as store of value but may be used to clear a reduced number of transactions. Both asset values rest mainly on their relative scarcity.

My StratWeekly December 7 2020

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