The start of a commodities supercycle & the great economic reset
There has never in the history of capitalism been a time where the divergence between the monetary and fiscal policy is this out of synch with the economic circumstances.
Central banks are flooding the markets with money which comes from nowhere as it's being digitally printed and has no productive counterpart whatsoever. The fiat system has totally destroyed the notion of money as a store of value. This reckless increase in money supply not only decreases the purchasing power of everyone through inflation but it also widens the gap between rich and pour, as wealthy people have access to heaps of cheap debt to finance their lifestyle while not paying any taxes on that and on top of that getting tax rebates and meanwhile storaging their wealth on asset classes such as crypto and equities which are taxed with rates far bellow the 50% of income tax.
Official inflation numbers for the US is 7.5% while the true number is probably in the range of 13-16%. When retail gets nervous about inflation what happens is commodities jump 2-3x in prices. In other words commodities is probably the most positively correlated asset class with inflation and as such a great hedge to inflation.
Now when it comes to crypto, no it won't hold up initiall. When the liquidity gets out of the markets, crypto as an asset class has never held it's ground, as it gets extremely positively correlated with stock markets when they show signs of weakness. The last prominent example is march 2020 with btc dumping 70% in a span of 3 weeks, as people getting caught in a stock market dump tend to liquididate other assets to pump margin into losing positions and avoid getting margin calls.
Now inflation isn't old news it was apparent as early as summer of 2020, it's just that it wasn't represented in the cpi then, as trillions where printed and were used to purchase assets globably. Billionaires profited most from this, as they could borrow money at 0% interest rates and buy assets like crypto, real estate and equities which have done more than 100% the last couple of years. Now that's asset inflation, and gradually through stimulus checks we get to see CPI inflation, or in other words inflation in things that we poor people actually buy in, like food, rent and electricity.
I expect 2500-3200 S&P to hit
5000-7000 Nasdaq to hit
18-20k BTC to hit with perhaps a liquidation event to 14k.
Ethereum 1000-1400 to hit.
We might be in for a 2-3 year bear market starting in the comming months which is a typical time frame for super bubbles like 2000,1929. Stock markets haven't corrected since basically 2008.
Stay safe
Central banks are flooding the markets with money which comes from nowhere as it's being digitally printed and has no productive counterpart whatsoever. The fiat system has totally destroyed the notion of money as a store of value. This reckless increase in money supply not only decreases the purchasing power of everyone through inflation but it also widens the gap between rich and pour, as wealthy people have access to heaps of cheap debt to finance their lifestyle while not paying any taxes on that and on top of that getting tax rebates and meanwhile storaging their wealth on asset classes such as crypto and equities which are taxed with rates far bellow the 50% of income tax.
Official inflation numbers for the US is 7.5% while the true number is probably in the range of 13-16%. When retail gets nervous about inflation what happens is commodities jump 2-3x in prices. In other words commodities is probably the most positively correlated asset class with inflation and as such a great hedge to inflation.
Now when it comes to crypto, no it won't hold up initiall. When the liquidity gets out of the markets, crypto as an asset class has never held it's ground, as it gets extremely positively correlated with stock markets when they show signs of weakness. The last prominent example is march 2020 with btc dumping 70% in a span of 3 weeks, as people getting caught in a stock market dump tend to liquididate other assets to pump margin into losing positions and avoid getting margin calls.
Now inflation isn't old news it was apparent as early as summer of 2020, it's just that it wasn't represented in the cpi then, as trillions where printed and were used to purchase assets globably. Billionaires profited most from this, as they could borrow money at 0% interest rates and buy assets like crypto, real estate and equities which have done more than 100% the last couple of years. Now that's asset inflation, and gradually through stimulus checks we get to see CPI inflation, or in other words inflation in things that we poor people actually buy in, like food, rent and electricity.
I expect 2500-3200 S&P to hit
5000-7000 Nasdaq to hit
18-20k BTC to hit with perhaps a liquidation event to 14k.
Ethereum 1000-1400 to hit.
We might be in for a 2-3 year bear market starting in the comming months which is a typical time frame for super bubbles like 2000,1929. Stock markets haven't corrected since basically 2008.
Stay safe