TRADITIONAL ECONOMISTS FEARING THE WORST. BUY BITCOIN NOW ?

[bornil267645]

The chief economist at HSBC, Stephen King, told clients that the global economy “is like an ocean liner without lifeboats.” He fears that another recession might be incredibly difficult, if not impossible, to recover from. He cited factors that many don’t consider when assessing whether a recession is likely, such as a collapse of the Chinese economy, which has seen a steady decline in recent quarters.

Note: the following is not professional investment advice. Please consult an investment professional if that is what you are looking for.

For Americans, who are just climbing out of the last recession now seven years later, another global recession could be disastrous. Unemployment is only just starting to correct itself, and in many cases, people have finally succumbed to taking jobs that pay less than they previously earned. This notwithstanding, the banker cites higher wages as a contributor to corporate stagnation as well as figures that say productivity is at a low.

Recessions are a supposedly natural part of the traditional economy; this cannot be argued. They are not usually global, but when they are, everybody suffers, from the highest income brackets down. Those living month to month with no safety net such as residual income or investment income are hit the hardest because if they lose their jobs they have nothing to rely on. If they manage to get another job quickly enough, it often will not pay the same wages, and then it becomes a question of how far inside their means they were previously living.

Bitcoin Could Be Your Lifeboat

The signs are clear that a recession is possible in the near term. Some industries will thrive in any economy, but most require there to be liquid capital to purchase their goods and services. Whether or not you believe your job is recession proof, now could be a golden opportunity to buy Bitcoin. The price is at historic lows, and you can rest assured that if a recession does hit, the wealthiest people will be looking at Bitcoin, buying it up, and therefore increasing the price with unprecedented buy pressure. For them, Bitcoin has only recently become a legitimate-looking investment, with things like the Bitlicense in New York nearing completion, the first Bitcoin bank ItBit receiving regulatory approval, and more than one fund trading in Bitcoin.

If you bought now, and the recession hit, you might see a chain reaction of the price increasing. You would then be able to dump your Bitcoin holdings onto wealthier hands and better survive the recession. Or, for many of the things you need to do, you could simply spend your Bitcoin directly, it having increased buying power as people look to get away from a weakening dollar.

There are many ways to prepare for hard economic times. Unfortunately, in this day and age, saving in a bank is one of the least effective of them. Giving Bitcoin a try might just prove to be a strategy worth your time.

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[aso118]

In a recession, asset prices tend to plunge. Bitcoin is still looked at by most people as some sort of asset/investment. If this mentality continues, Bitcoin's price too could plunge during a recession.

[maku]

Right now and in the near future, bitcoin will loose its value in times of economic recession. Today only geeks (like some of us) believes that btc will cure some of the problems that today "classic" currency have. But that's the future, if tomorrow there will be some kind of financial crash bticoin will drop massively as well.

[NUFCrichard]

stock markets are at all time highs, or very near to them.  They have risen over 100% since the last recession, even though most economies aren't doing well.
It's been about 5 years of near uninterupted gains, yet interest rates remain at or near zero and actual employment numbers are poor.

We are due a correction, the markets are being propped up.  I fear that the correction will just be about 10%, then it will continue onwards and upwards.  At some point we will all pay for this cheating of the economy, but it might be a while yet.  Only when confidence in the system is lost will everything come down, that's when it will be time to go for Bitcoin!

[aso118]

stock markets are at all time highs, or very near to them.  They have risen over 100% since the last recession, even though most economies aren't doing well.
It's been about 5 years of near uninterupted gains, yet interest rates remain at or near zero and actual employment numbers are poor.

It is all QE driven. That is why whenever there was some positive news (like improvement in employment data) during QE, markets crashed because they were afraid that QE might end.

[Possum577]

It is all QE driven. That is why whenever there was some positive news (like improvement in employment data) during QE, markets crashed because they were afraid that QE might end.

This is true. But don't you think that every negative turn despite positive news gets us closer to absorbing the impacts of the end of QE? Eventually the markets will have reacted as much as they ever will to QE and we'll be back on our own way...with the market reaction to new news only.

[tabnloz]

The price is low but in this global QE fed economy of distortions and unchartered policy combinations, who can predict where btc will go?

There are so many questions and unknowable variables as to how bitcoin will behave during a stock correction, a gold spike / dip, events in China or US (together or in isolation).

But we do have some assumptions that seem valid:

* The infrastructure of the btc economy is being built out rapidly, both in a decentralised sense and in integrating with traditional systems.

* Longer term, in an era of ZIRP, NIRP, bailins and banning cash, btc will act as a store of value.

* As evidenced by NSA scandal, media coverage, TBTF institutions and the actions of big banks pre crisis, it is difficult to distinguish between economic truth, spin, opinion and misinformation.


This says to me that btc could go much higher in the future. For others the steep price decline YOY says that btc is doomed to failure.

[Buttknuckle]

The more pessimistic the general public is about something, the more I like it.  Pessimism about crypto currency seems to be at an all time high.  Time to get in.

As far as the economy, its not going to great in america.  Sure the numbers look good, but many employed people are earning the same or less than before, and at the same time there is a serious increase in housing cost and medical costs squeezing the middle class.  The stock market is at historical highs as far as valuation goes, and it will go down when interest rates go up.  Whether its a bear market or a crash depends on the presence of a catalyst.  In any case I have sold most my stocks.   This isnt market timing, its capital preservation.   I havent got much and I really dont want to lose it.

I see bitcoins as a good prospect.  It is getting better known all the time.  In general I expect more adoption which should equal better price.  It seems silly to invest in a currency, but if you look at it as bullion and storage of value instead of currency then it makes more sense.  I don't know if the general public will see it this way. 

[sdmathis]

John Kenneth Galbraith said "The only function of economic forecasting is to make astrology look respectable." I wouldn't put too much stock into economic forecasts.

[qiwoman2]

I am not quite sure if buying up a ton of btc is the right choice right now. Having a few bitcoins as part of your portfolio can't do any harm but I wouldn't bet all my bank on it because you should always diversify your assets as much as possible and not stick all your eggs in one basket.

[AtheistAKASaneBrain]

I've noticed a trend of economists that went from hating BTC, to being neutral, to being supportive and presenting themselves as Bitcoin experts and charging for BTC courses. How ironic.

[gentlemand]

Bitcoin is still a luxury and an oddity. It would need to be a whole lot more established to be anywhere being considered some kind of safe haven.

If your job goes in a recession the last thing you'll be tempted to do is buy more.

[Buttknuckle]

you should always diversify your assets as much as possible and not stick all your eggs in one basket.

Quoting just for emphasis.  This is the golden rule for any type of investing.  No matter how good an investment looks there is always a chance of it going down.  Things like disruptive technology or fraudulent accounting can wipe a company out overnight.  Bitcoin could become valueless if for example someone figures out some exploit that no one thought of before.

[legendster]

Isnt it amazing how most of us who are replying here are part of a paid signature campaign ?? Haha
Sticking to topic, no time is a good time to invest, similarly no time is a bad time to invest - when we are talking about cryptos.
Yes, the world economy may face another crisis pretty soon but chances are when that happens there wouldnt be much need currency exchange going on in the crypto world which could lead to a fall in BTC prices. When you think about an investment, you need to consider the one very crucial aspect : 'Store of Value'.

Bitcoin or any crypto currency is not a reliable store of value. So yeah, it can be your life boat - under the right circumstances OR it can be a sinking stone.