The Year of the Black Swan: Two Significant Financial Events to Watch in Q1 2024

What Is a Black Swan Event?

A black swan event is an extremely rare and unpredictable occurrence that has significant and widespread consequences.

It is characterized by being an unexpected outlier, having a high impact, and then being “rationally” explained after the fact.

The term originated from the belief that all swans were white until the discovery of a black swan in 17th century England.

Examples of black swan events include the 9/11 terrorist attacks, the 2008 financial crisis, and the COVID-19 pandemic. These events are difficult to predict and often have a profound effect on various aspects of society, such as politics, business, and financial markets.

While black swan events are typically associated with negative outcomes, they can also have positive effects, like the rapid rise of the internet.

Black Swan #1: Expiration of BTFP (emergency bank liquidity program) March 12th 2024

The expiration of the Bank Term Funding Program (BTFP) by the Federal Reserve on March 12th, 2024 holds significant potential as a strategic “Black Swan” event.

The decision to let the BTFP expire, despite ongoing bank reliance, is considered surprising and could lead to a major banking crisis.

Consequences include a decline in bank loans, impacting economic activity and reducing persistent inflation. Big banks stand to benefit by acquiring distressed banks, consolidating the financial landscape.

The strategic motive behind this potential Black Swan event is suggested to be the implementation of a U.S. Central Bank Digital Currency (CBDC).

The relationship between big banks and the Federal Reserve is a financial country club, and a planned banking crisis would create ideal conditions for quick CBDC legislation, small/medium bank consolidation, and the elimination of regional bank competition.

Read more about this event here:

Black Swan: Why US Banks Could Crash on March 12th 2024

Black Swan #2: The Bitcoin Halving March/April 2024

The 2024 Bitcoin Halving is a potentially significant “Black Swan” event in the context of its impact on the Bitcoin network and its implications for the global fiat financial system.

Occurring approximately every four years, the halving is emphasized for its role in preventing inflation and maintaining the scarcity of bitcoins. Unlike fiat currencies which are significantly susceptible to manipulation through unlimited printing, the halving model ensures a controlled supply.

The reduction in block rewards during halving events leads to a predictable and diminishing inflation rate, safeguarding against the erosion of purchasing power seen with traditional fiat currencies.

The article below highlights the unique market-driven mechanism of Bitcoin’s price influenced by scarcity, in contrast to fiat currencies affected by external factors.

Historical data from previous halvings in 2012, 2016, and 2020 illustrate the event’s impact on Bitcoin’s supply, inflation rate, and price dynamics.

The upcoming 2024 Bitcoin Halving is anticipated to continue this trend, with varied expert predictions for its potential impact on Bitcoin’s price, emphasizing the event’s significance in the cryptocurrency world.

Understanding Bitcoin Halving is portrayed as crucial for those interested in cryptocurrencies and their potential influence on the global financial landscape.

Read more here:

The 2024 Bitcoin Halving: What You Should Know and Why It’s Important