Economist Peter Schiff, known by his nickname "Gold Bug," tweeted this week that he thinks there are two scenarios for the financial markets to react to the US Federal Reserve at the moment:
● Or “The Fed succeeds in returning inflation to 2%. Stocks, bonds, and real estate all crash, ushering in a massive financial crisis and severe recession that includes government defaults & spending cuts”;
● Or “The Fed pivots before inflation returns to 2%. If the Fed pivots, either to avert a financial crisis, or in reaction to one, inflation will soar, the opposite of what was experienced after the 2008 financial crisis. This time instead of running toward the dollar, the world will run away from the dollar.”
Billionaire Schiff believes that "The days of sub-2% inflation are gone," so it's worth preparing for the serious implications of today's market realities. This also applies to the digital asset market, since today it’s absolutely clear that the exchange rate of the main cryptocurrencies does not just correlate with the prices of the largest fiats and classic assets, but directly depends on them. The fight against inflation in the US and the UK is a forced reaction to the global logistical, economic and infrastructure crises, and, apparently, the consequences of the actions of the governments of large states may turn out to be much less predictable than we would like to.
Canadian businessman and chairman of O'Shares Investments, Kevin O'Leary, recently stated that Bitcoin's price action could pick up and we could see an uptrend, but that would first require the U.S. Congress to pass the Stablecoin Transparency Act. “Even though it has nothing to do with Bitcoin, that will be the first regulation passed by U.S. regulators, and I would argue you want to be long bitcoin going into that outcome. You’re going to see a lot of interest in institutional capital coming into stablecoins.” — O'Leary said. The businessman also believes that if financial institutions adjust their actions in accordance with political ones, then there will be a real chance for the growth of the cryptocurrency flagship. Thanks to this, the price of BTC will be able to overcome the trading range from $19,000 to $22,000, and this can happen quite quickly. That is, the scheme boils down to the fact that as soon as stablecoins fall under transparent regulation, bitcoin will begin to grow. But it is extremely important that the regulation algorithm assumes the legitimization of digital assets. This is what will become a "green light" for investors, who now risk not only losing their deposits, but also "quarreling" with the regulator.
The Conference Board, a non-profit research platform whose membership includes more than 1,000 public and private corporations and organizations from 60 countries, has released the results of a survey of 136 US executives who were asked to describe the economic conditions they are preparing to face over the next 12 to 18 months. According to the survey, the vast majority of CEOs, namely 98% of those surveyed, said they were preparing for a massive recession in the US, and 99% of respondents said they had begun preparing for a recession in the EU. Chief Economist of The Conference Board, Dana M. Peterson, drew attention to the fact that CEO confidence in economic institutions fell by several points by the end of the 3rd quarter of 2022, and at the beginning of the fourth quarter this indicator is at the lowest level since Great recession. But this is not news, as many experts have predicted that the US economy is likely to slide into recession. For example, JPMorgan CEO Jamie Dimon suggested that a recession could hit in six months and the stock market could easily drop another 20%. In June, the chief executive of the corporation warned of an approaching economic hurricane, advising people to prepare. And in August, the head of JPMorgan hyped and announced that “something worse” than a recession was coming.