Raoul Pays, CEO of Real Vision and a macro expert, claims that he is stockpiling cryptocurrency assets because he anticipates a sharp decline in economic statistics over the coming months.
The former Goldman Sachs executive claims that since economic unrest has already been largely priced in, risky assets like equities and cryptocurrencies shouldn’t fall much further.
“Over the next three months, the economic data will completely collapse,” The inflation story will completely disintegrate, leaving only rags behind. And the market is wondering if this means that either stocks or cryptocurrencies need to decline.
And given how much has already been included in, in my opinion, the price may not be much lower. Whether it’s an AAII [American Association of Individual Investors] study, an institutional investor survey, a market positioning survey, or a survey from Bank of America Merrill Lynch, this is the most pessimistic mood I’ve ever seen in the last 40 or 50 years in the financial markets.
The market so struggles to establish a legitimate new major bottom. Although a 10% drop in the S&P 500 is theoretically feasible, I’m not a buyer at these prices.
I recently started buying cryptocurrency. In June, I was able to reach the low and made tremendous gains. Therefore, I believe that a large portion of the end of the world has already been included into the markets. Everything believes that it must all fall on the following earning leg.
Pal continues to believe that the Federal Reserve will switch back to lowering rates, which will strengthen risk assets, despite a number of rate hikes and aggressive statements from the Fed.
The bond market is absolutely out of sync with all other macro and every other asset class at a rate that has never happened in history, which will make the problems we are facing worse.
In the end, though, I still think that bond yields will eventually decline much more rapidly than most people anticipate, forcing the Fed to alter its course.
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