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The economy is doing well, they say. No, maybe not. A growing number of economists (and other notable ones) have begun to extol their theses, pointing out that the global economy was not in crystal clear water, despite the apparent tightening of the stock market. The Bitcoin giant's research division, BitMEX, tackled this issue Tuesday by publishing an in-depth study on the "anatomy" of the potentially inevitable global fiscal mess.
Hold on, what they wrote is not very pretty.
The impending crisis and Bitcoin
The research unit of the Hong Kong-based stock exchange has first laid out a number of basic rules, explaining that since the rise of modern society, financial crises have brutalized investors every ten years. about years. BitMEX Research then drew on dozens of statistics to describe the current state of the global economy.
MUST READ. It's HAPPY.
Anatomy of the Next Global Financial Crisis – BitMEX Blog https://t.co/YuEx7Bxt9R
– Max Keizer, poet tweet. (@ maxkeiser) February 12, 2019
In summary, the team of researchers and badysts noted that the current financial system is currently unstable and fragile, thus confirming its claim by drawing attention to the dichotomy between the general lack of volatility and the sudden outbreaks of VIX. They noted that this instability was only underscored by low interest rates and a tumultuous political climate (think Brexit, Trump / Yellow Jacket), which makes it all the more interesting. more likely an underlying crisis.
And keeping this in mind, the BitMEX research team noted that it may be wise for investors to start building risk-mitigating portfolios. The exchange team wrote:
"Perhaps we could build a portfolio of VIX calls, long-term listed corporate bonds, index-linked government bonds, hedge funds specializing in volatility, gold and maybe in a lesser extent, even in Bitcoin. Again, although it is not known when these events will occur, it may be time to adjust its investment portfolio. "
Related reading: Exec of the European Central Bank: Bitcoin is the "harmful product of the financial crisis"
Financial operators are waving red flags too
same the The International Monetary Fund (IMF) has begun to express a sentiment that should worry both the institutions and the common investors, the International Monetary Fund (IMF). In a recent speech at the World Government Summit in Dubai, Christine Lagarde of the IMF said the global financial environment was approaching four swarms, heralding the possibility of a "storm".
Lagarde explained that these clouds included the US-China trade conflict, quantitative tightening, Brexit and, arguably the most important, the "heavy debt" that governments, individuals and companies have accumulated.
And, according to a recent MarketWatch article, the amount of US public debt surpbaded $ 22 billion earlier this week, reinforcing the idea that the global economy may be in a desperate situation. In response to this growing statistic, the Peterson Foundation, a US-based financial services group focused on changing the country's economic problems, said the fiscal situation is "not only unsustainable but accelerating."
While some claim that by a miracle miracle, the US government will find a way to pay its debts (or not repay them without macroeconomic collapse), many economists apparently claim that the end is near.
Ray Dalio, the co-founder of Bridgewater Associates, the world's largest hedge fund, has recently drawn worrying parallels between the current environment and the Great Depression. In a comment made in Davos, the world – renowned investor, who has become a pessimist in the market recently, explained that between 1929 and 1932, there had been a lot of "printing of money and money. purchase of financial badets ", just about like today. .
If you do not want to hear one of the richest men in America, for whatever reason, others have made similar comments. Dr. John Hussman, an American economist and investor with forecasting predicament, said earnings growth announced by investors would likely be "below what we have seen over the past two decades." with the idea that investment advisers tacitly encourage "reckless speculation" to conclude that stocks are trading at the "most obscene valuation" of all time.
Even Kenneth Rogoff, professor of economics at Harvard University and former chief economist of the IMF, expressed his sad feeling in a editorial recently published in Guardian. Rogoff remarked:
"Unfortunately, an inexorable financial system, combined with an increasingly toxic political environment, means that the next major financial crisis could come sooner than you think."
Crypto could be the answer?
Travis Kling thinks that cryptocurrencies, especially Bitcoins, could be the solution to a crisis, or at least the badet that will remain standing after such an event. Kling recently said that Bitcoin is a perfect protection against "the irresponsibility of fiscal and monetary policies". He said the skyrocketing strategies of Quantitative Easing (QE) used is "how would you write the script" for adoption all a decentralized nature.
Trace Mayer, a long-time Bitcoiner and zealous thinker against the establishment, echoed Kling's concerns about increasing public debt. In a recent tweet, Mayer pointed out that the 2008 recession was only 11 years old, but that governments and society in general did not learn what they had accumulated.
https://t.co/7mqtD0i5M2
11 years later with an additional debt of $ 87T The second verse is a little stronger and a little worse.
Except now, the safe and liquid pyramid of cash $ gold a new neighbor: #Bitcoin
And 99% in cash and 1% $ BTC can be a very good risk / reward portfolio construction. ? pic.twitter.com/wZy29LvXAN
– Trace Mayer (@TraceMayer) February 13, 2019
Echoing PlanB's badysis, Mayer then concluded that a portfolio consisting of 99% cash and 1% bitcoins could be attractive from a risk / return perspective and could outperform on a net basis. global bear market.
Featured image of Shutterstock
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