The Birth of Bitcoin and the Perspective of Large Investor Masses Today: Yes, there is a contradiction here. When Nakamoto brought this idea to life, he was drawing attention to the cycles of rescue in the banking system. However, today, most investors are targeting speculative gains in cryptocurrencies. Famous macroeconomics expert Hugh is warning Americans.
US Deposits Could be Frozen
In a recent interview with Bloomberg Markets, hedge fund manager and macroeconomics expert Hugh Hendry issued important warnings about the US banking system. He emphasized that the exodus from the US banking system is continuing and believes that something much worse could happen. According to him, in order to prevent the problems caused by this exodus, the US could impose restrictions on the withdrawal of deposits from accounts.
Hendry suggests that further declines in the partially liquid demand deposit accounts, which are tracked in M2 money supply, could prompt the US government to intervene and convince citizens to prevent them from withdrawing their capital from the banking system.
"Sometimes it's appropriate to panic. I advise you to panic... You've just seen the largest drop in M2. M2 is deposits, not credit. These are deposits fleeing the system and going into money market funds. This could turn into a process where the Treasury and the Fed have to really restrict your ability as a US citizen to take money out of the US banking system."
The 1934 Gold Decision and Bitcoin (BTC)
Hendry says that the capital flight from US banks is not only related to fears about whether the FDIC will insure deposits above $250,000, and that providing a general guarantee to deposits would not solve the problem. This issue was raised in March but Yellen backed off. It was revealed in April that over 700 banks were facing the risk of bankruptcy.
"There is capital flight, there is deposit flight seeking returns from the banking sector. I'm afraid I'm not saying this lightly, but in 1934, the Federal Reserve Act took Americans' gold away. We are at a point where I'm sure Fed and Treasury officials are considering locking up US bank deposits."
In this environment of uncertainty, the famous expert believes that Bitcoin could be a good alternative for Americans to place their capital. On the other hand, gold, which reached historic highs, is also in demand from investors. The demand is not only from investors, as many countries like China have been increasing their gold reserves for a long time.
"It's time to have the most hated asset in the universe, ultra long-dated Treasury bonds. I know you all think we have an inflation problem. It was a supply shock. A supply shock requires the manifestation of more bank credit creation to carry it into the future. We are experiencing the opposite. I don't have any idea about it yet, but Bitcoin is something I can think of as an asset class that could potentially gain three or four times more value in the next five years. I don't have any other asset class to make that observation."
This article is not investment advice. Anyone considering investing should do their own research and take their own risks.
