According to a report from Capriole Investments, the U.S. Federal Reserve’s (FED) aggressive monetary policy is one of the reasons that Bitcoin may outperform other assets in the coming year. The FED has taken steps to increase the money supply in the economy and lower interest rates in response to the COVID-19 pandemic.
Capriole Investments suggests that this could lead to a decrease in the value of traditional assets and an increase in demand for alternative stocks like Bitcoin. However, remember that this is just one company’s prediction and that many other factors could affect the performance of Bitcoin and other assets in the coming year.
The U.S. Federal Reserve (FED) has a history of lowering the federal funds rate, an interest rate at which banks can lend and borrow overnight, in response to high inflation, according to a report from Capriole Investments. In the past, the FED lowered the federal funds rate when inflation exceeded 5% and declined by more than 20%.
While the peak of inflation has typically persisted for several more years in these instances, it has eventually swayed in the 2-3% range in the following years while the Federal fund rates remained low.
This analysis relies on historical data, and beware that many other factors could impact the economy and the actions of the FED in the future. Therefore, researching and consulting financial professionals is always a good idea before making investment decisions.
Capriole Investments’ Predicts Bitcoin Will Outperform Gold in the Coming Decade.
According to an analysis by investment firm Capriole, Bitcoin may outperform Gold in the coming decade due to its perceived advantages. The firm cites three main reasons for this: its resistance to counterfeiting, its digital nature that makes it easier to transfer and store, and its smaller size when you contrast it to Gold.
Capriole also predicts that the 2020s will be a “decade of hard money,” similar to the 1970s and that this could be a “lost decade” for stock market investors. At the time of the analysis, the one Bitcoin was $16,584. It is unclear from the information provided what the “Bitcoin bottom signals” or “cost of production” mentioned in the passage refer to or how they are relevant to the analysis.
In conclusion, Capriole Investments believes that the U.S. Federal Reserve’s monetary policy and lower value of traditional assets may increase demand for alternative investments, like Bitcoin, in the coming year. However, it is important to remember that this is just one company’s prediction and that many other factors could affect the performance of Bitcoin and other assets.
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