Arthur Hayes Predicts 1930s-Style Debasement to Boost Bitcoin and Stock Market, Hurting Savers
BitMEX co-founder Arthur Hayes predicts that a forthcoming devaluation of fiat currencies will lead to a surge in the values of Bitcoin (BTC) and stocks. In his recent analysis, the cryptocurrency expert expresses certainty that the economy is entering a new phase of inflation, and BTC will soon “regain its mojo.”
Hayes highlights data from the Congressional Budget Office (CBO), which forecasts a record $1.9 trillion budget deficit for the US in the 2024 fiscal year, excluding the COVID-19 crisis years. According to Hayes, there is no recession on the horizon, but many individuals may face financial hardships. Despite this, he believes that the overall economic system will remain stable.
The crypto veteran emphasizes the loose fiscal and monetary policies in place, advocating for holding onto cryptocurrencies as a means of wealth preservation. Drawing parallels between the present situation and the economic landscape of the 1930s to 1970s, Hayes suggests that transitioning from fiat to crypto assets is prudent due to the anticipated devaluation resulting from the expansion and centralization of credit allocation through the banking system.
Hayes also anticipates that companies will leverage inexpensive credit to artificially inflate their stock prices through buybacks. Central banks’ bond purchases have increased credit availability and reduced costs, prompting firms to borrow money for stock repurchases.
The prevailing economic environment, according to Hayes, presents an opportunity for individuals to safeguard their wealth by investing in cryptocurrencies. He suggests that the current conditions resemble historical periods marked by currency devaluation and centralized credit allocation, making crypto assets an attractive option for wealth preservation.
In conclusion, Hayes’ analysis underscores the potential impact of impending fiat devaluation on Bitcoin and stock markets, urging investors to consider cryptocurrencies as a hedge against economic uncertainties.
