On the Crazy Crypto/Stonks Extravaganza in Recent Days

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by Chris Black

All this carnage and the FED has not even tightened yet.

June should be an interesting month.

And the markets have not even woke up yet to the high inflation economy we are in now where corporations earnings/profits get decimated due to people having less discretionary income.

Algos rule the stock market. Trying to make sense of any move is a fool’s game.

Inflation is way out of control. Even the 1970s wasn’t this bad. The current inflation rate if it were based on the same metrics as the 1970s would be close to 30%.

Homes that were selling for $150k in garbage towns last year are up over $225k right now. $10 retail items in 2020 are now $22. If the Fed keeps playing this game to prevent the largest bubble in history from popping, it just creates more pain.

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Bitcoin has been correlating with stocks since the pandemic, so whatever affects the traditional market affects Bitcoin.

BTC is now mainstream so it is affected by macroeconomics factors and monetary policies.

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Bitcoin will likely trade like stocks for a long time.

We are going down baby.  You will own nothing and work for Amazon.

In 2018 all hell broke loose when the 10 year reached today’s levels.

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Housing tanked and stock market sold off. Interest rates were at 2.5% before Trump bullied Powell into submission.

1.5% will collapse everything this time due to massive debt load.

Most companies have survived by rolling over their debt at very low levels to support their money losing operations (Uber, Lyft, etc.).

The repo market will fall apart since much of the collateral will become questionable just like in 2018.

That’s when the real fireworks will start when credit dries up due to junk collateral.



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