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Ending the Gridlock: The Long-Awaited Debt Ceiling Compromise
This week I have a bit of exciting personal news!
I’ve signed my first book deal with Wiley & Sons to turn Myth Of Money into a book. It will feature several of my personal stories across crypto and finance, interviews I’ve conducted over the years, and some educational content about how money actually works!
Wiley is a leading professional and trade publisher in finance and investments and has published popular books such as The Bitcoin Standard, Cryptodad: The Fight for the Future of Money, Out of the Ether: The Amazing Story of Ethereum, and Investment Banking.
I’m really looking forward to working with them and creating something special for the community! The tentative release date is early 2024.
Debt Ceiling Deal Reached
President Joe Biden and top congressional Republican Kevin McCarthy have reached a breakthrough agreement to suspend the $31.4 trillion federal government debt ceiling, ending a long-standing stalemate. The announcement lacked celebration, reflecting the contentious negotiations and the challenging path through Congress before funds are depleted in early June.
The deal suspends the debt limit until January 2025 and includes spending caps for 2024 and 2025 budgets, reclaiming unused COVID funds, expediting permitting for energy projects, and introducing work requirements for food aid programs.
After intense discussions, the agreement was swiftly formed through phone calls, including a 90-minute conversation between Biden and McCarthy. Further deliberations occurred between the White House and House leaders.
While details are being finalized, McCarthy expects to conclude the drafting process on Sunday, engage in further dialogue with Biden, and schedule a Wednesday vote. Bipartisan support is crucial in the House and Senate, where Republicans hold a slim majority and Democrats have a narrow lead, respectively.
Negotiators have also agreed to cap non-defense discretionary spending at 2023 levels for one year, with a 1% increase in 2025.
Increase Taxes or Cut Spending?
Republicans aim to cut spending, while Biden and Democrats push for increased taxes to address the massive U.S. debt and fund initiatives like free community college. The prolonged debt ceiling standoff rattled financial markets, causing stock impacts and record-high interest rates. A default would trigger a recession, disrupt the global economy, and spike unemployment. Initially, Biden refused negotiations with McCarthy but began talks on May 16. However, raising the debt ceiling still requires significant effort. Passage relies on moderate support to overcome opposition and secure enough Republican votes in the Senate.
Meanwhile, Florida Governor Ron DeSantis, in a significant announcement on May 24 during a Twitter broadcast attended by Elon Musk and over half a million listeners, declared his candidacy for the 2024 presidential election. DeSantis has pledged to prioritize the protection of Bitcoin if he emerges victorious in the election.
This Week By the Numbers 📈
Product of the Week 😋
This week I’m excited to share with you a company founded by a dear friend Brandon Hiemstra - House of Macadamias (HOM).
As a long-time reader, you know I don’t share anything here that I don’t consume myself.
Many of us are already integrating nut products such as almonds and cashews into our daily diet, but did you know that Macadamias are lower in net carbs than most popular nuts (33% less than almonds and 50% less than cashews) and have arguably the best fat profile of any nut (almost like avocado on steroids!) This is what we call a monounsaturated fat for the ultra-healthy Mediterranean diet.
Endorsed by Tim Ferriss and Joe Rogan, HOM products have no added sugar or artificial ingredients - choose from hand-sorted, macadamia bars, creamy nut butter, and cold-pressed Extra Virgin macadamia oil, perfect for cooking given its high smoke point and buttery flavor.
For a very limited time, HOM is gifting our readers a free box of Namibian Sea worth $35 plus 20% off your entire order with code MYTH20.
Top Stories 🗞️
The New York City Banking Commission voted to halt deposits into the city's bank accounts at Capital One (COF.N) and KeyBank (KEY.N) after the lenders failed to submit plans on their efforts to root out discrimination. City Comptroller Brad Lander joined Mayor Eric Adams and the department of finance to announce the city would stop making deposits into the two banks, Lander said in a statement Thursday. The existing accounts will be used to make payments, but no additional deposits will be made, nor will new accounts be opened at either bank, according to a spokesperson for the comptroller.
Elon Musk's Neuralink received U.S. Food and Drug Administration (FDA) clearance for its first-in-human clinical trial, a critical milestone for the brain-implant startup as it faces U.S. probes over its handling of animal experiments. The FDA approval "represents an important first step that will one day allow our technology to help many people," Neuralink said in a tweet on Thursday, without disclosing details of the planned study. It added it is not recruiting for the trial yet and said more details would be available soon.
On May 22, Nanjing, the capital city of China’s eastern Jiangsu province, inaugurated the China Metaverse Technology and Application Innovation Platform to advance metaverse research and development across the country. The platform aims to bring together the resources of academic institutions and enterprises in China, strengthening research endeavors in metaverse-related fields. The metaverse refers to a virtual universe or collective virtual space encompassing all virtual worlds, augmented reality and virtual reality experiences. It is an interconnected digital realm where users can interact with each other and with computer-generated environments in real time. In February 2023, the city revealed its metaverse strategy, aiming to create a thriving industry with annual revenues surpassing 135 billion yuan ($19.13 billion) by the close of 2025.
Cryptocurrencies like Bitcoin may have lost their sheen as investments but that's not impacting the real enthusiasts. Salvatore Liggiero, an Italian developer unveiled the design of the world's first Bitcoin Tower. This 40-story architectural marvel is planned to be constructed in Dubai. And you guessed right, it will be in the shape of the Bitcoin currency symbol. Liggiero claims that his vision for the hotel does not fall under the traditional idea of hospitality. The developers will incorporate various technologies, and sustainable materials to build the tower. The developers have also offered a commitment to zero CO2 emissions in building the tower.
The Hong Kong Securities and Futures Commission (SFC) announced it would soon allow licensed platforms to serve retail investors. In a May 23 announcement from the SFC, the regulator said operators of virtual asset trading platforms willing to comply with the SFC’s proposed guidelines are welcome to apply for a license. The guidelines for virtual asset trading platforms will include asset custody safety requirements, cybersecurity standards and the segregation of client assets — among others. The SFC CEO Julia Leung said that providing clear regulator expectations is “key” to creating a responsible and innovative development environment.
Thank you for reading this week’s edition of the Myth of Money.🚀
Until next week,
About the Author: Tatiana Koffman
Hi there and thanks for reading! If you stumble upon my newsletter, you will notice that I write about money, economics, and technology. I hold a JD/MBA and spent my career in Capital Markets working across Mergers & Acquisitions, Derivatives, Venture Capital, and Cryptocurrencies. I write to make financial topics more accessible and create equal opportunity for the next generation of investors. I have personally invested in 20+ companies and funds (👉 my portfolio).