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Thread #1: Alright, lets make a thread about the current financial macro situation in the world. We all know corona is the catalyst for the financial bubble that popped (if you don’t believe this is a psyop, you should unfollow me rn).
What’s interesting is that if you look at the macro economic situation, we clearly are in a downfall of the long term debt cycle (see image). The productivity line is (almost) irrelevant as our whole economy is based on credit rather than productivity.
The reason why a long term debt cycle starts high is because people are investing the money they just received. When a recession hits, Bank doesn’t give loans easily = spending goes down
Spending goes down = economy goes down = people gotta pay back the money (hence the downfall in the chart). The long term debt cycle bust is called a deleverage. It can either be nasty or not.
A beautiful deleverage: 1. Gov is giving money to the jobless people by taking from the rich 2. Gov cuts debt in 2, banks receive some money instead of nothing 3. Gov is printing money.
If all 3 happens at the same time, the recession could go smoothly and we recover. But if only 1 or 2 measurements are taken, the recession will go terrible.
Right now , we see that the gov is printing money but the first 2 measurements aren’t taken into reality (yet). The next few months will be very interesting with all the shit happening with Deutsche Bank.
I had a discussion with a friend last weekend and we both agreed that a big crash will happen based on the possibilities. Holding cash (yes, I know, inflation bla bla) is ironically a good call as you want to buy the dip in real estate or stonks.
In terms of crypto, I have honestly no idea. We don’t have a clear history of what happens with crypto during a big macro crash outside of march (which I don’t see as the ultimate crash).
TL;DR : be a permabull on cash and Chainlink
