The market, looking at risk assets such as bitcoin seems to be thinking we are going back to the past 10y norm in terms of interest rates.
I do not see a world where we go back to 0% unless we do into a deep deep recession.
I do not see a world where we go back to 0% unless we do into a deep deep recession.
Now as ironic as it is, that would also mean that risk assets would likely come under immense pressure as capital becomes scarce.
My view over the US int rates is that we will stay above 2.5-3% for the next decade.
My view over the US int rates is that we will stay above 2.5-3% for the next decade.
The 0% int rate and QE times are gone and I think people as well as the FED recognize the enormous mistake that led to
0% means you have no breathing room when a crisis hits. (which we solved with even more QE)
We saw companies that should have gone bankrupt continue to survive
0% means you have no breathing room when a crisis hits. (which we solved with even more QE)
We saw companies that should have gone bankrupt continue to survive
We saw Housing become more unfordable than pretty much ever before as debt became cheap. (leading to people not willing to sell now and higher rental market).
QE and 0 Rates should have stopped after 2011ish.
People got drunk on debt and the risk was very low for a decade.
QE and 0 Rates should have stopped after 2011ish.
People got drunk on debt and the risk was very low for a decade.
Getting rich should not be easy, getting rich should not be done by accumulating mountains of bad debt.
These processes are long and painful and will likely lead to less GDP output.
The reason is simple, any new project needs to be financed at a higher cost.
These processes are long and painful and will likely lead to less GDP output.
The reason is simple, any new project needs to be financed at a higher cost.
Bad risk is somewhat protected as we do not see the type of variable loans we saw pre 2008 crisis, however anyone that wants to continue with bad deals and practices will have to pay the price from now on.
You see corrections in that area now.
You see corrections in that area now.
Houses are not going for 50% over ask.
The unprofitable companies deflated by 70%+
This is also why I think the MEME basket and alike will stay down while true assets will recover during the final waves
There needs to be an understanding that the old reality is now truly gone.
The unprofitable companies deflated by 70%+
This is also why I think the MEME basket and alike will stay down while true assets will recover during the final waves
There needs to be an understanding that the old reality is now truly gone.
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