Looking at the phenomenon of bitcoin, it reminds me of Internet stock bubble at the end of the 1990s. At that time, Internet-related stocks rose greatly and power and money moved to Silicon Valley in West from Wall Street in East. Because the Fed raised the interest rates rapidly, the Internet stock bubble eventually collapsed, and Nasdaq has had a long break for almost eight years. After the internet stocks bubble collapsed, the real estate was booming and shares of U.S. financial sector marched high altitude. In fact, real estate and banks have no significant impact on the real economy.
However, the financial crisis in 2007-08, the real estate collapsed and Wall Street's financial industry received government reliefs and government regulation together. While the stocks of financial companies crawled during the past ten years, Amazon, Google, Facebook High-tech shares rose greatly again, and the top six companies of the most valued companies are high-tech companies (Google, Apple, Microsoft, Amazon and Facebook) .
Along with that, the human resources, capital and power of the United States are moving to tSilicon Valley in west in the eastern from Wall Street in east part of the United States. The winning of the trump 's presidental election and the Wall Street began to fight back. The wall street still holds the financial hegemony at this time.
he financial institutions are trying to dismantle the Volcker's rule in the Dodd-Frank Act. In addition, the Federal Reserve has been trying to raise interest rates carefully again. It is raising the bank's net profits of banks and stocks of banks are gradually rising again.
However, as the short-term interest rate rises and the long-term interest rate declines, the economy will again enter a recession, so the Fed is trying to raise the long-term interest rates through quantitative reductions.
The appearance of bitcoins at the peak of the great recession is a threat to Wall Street banks, but it is the best ally for Silicon Valley IT companies. The hegemony of finance will be split between Wall Street banks and IT companies in Silicon Valley due appearance of bitcoin. There are a lot of US IT companies getting benefits from booming of bitcoins. Typical examples are NVIDIA (NVDA) and Overstock.com (OSTK).
Among the forces that influence the political world in the United States, the power comparison of the Wall Street of the financial institutions' hegemon and Silicon Valley represented by the IT company has been transferred to the bitcoin. It seems that the US government will not easily sanction bitcoins. In addition, although Amazon does not receive bitcoins yet, Overstock.com suddenly becomes hot stock while amazon watching the stock price of Overstock.com rises in only a few months, it will start to receive bitcoins eventually, and the influence of bitcoin further expands.
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