Bitcoin (BTC) is winning the battle of the safe havens as another corporate buy-in sees $115 million enter its books.
Asset management giant Stone Ridge confirmed that it made the significant purchase via its spin-off New York Digital Investment Group or NYDIG, which now has over $1 billion in assets under management.
Economist: Fed must print $5 trillion in 2021
“The macro backdrop against the public health backdrop has caused a lot of people to rethink their portfolio composition,” the company’s new CEO, Robert Gutmann, told Forbes on Oct. 13.
“As the trillions of dollars on the balance sheets of banks, asset managers, insurance firms, endowments, & family offices begin their migration to the #Bitcoin universe, they will need firms like NYDIG to guide them. $1 billion down, more to go.”
The news comes as a new report warns that the United States Federal Reserve will need to print $5 trillion next year.
Published on Oct. 12, the report by economists Lawrence ‘Larry’ Summers and David Cutler calculates the indirect cost of the Coronavirus to be $16 trillion.
“The total cost is estimated at more than $16 trillion, or approximately 90% of the annual gross domestic product of the US. For a family of 4, the estimated loss would be nearly $200 000,” it summarizes.
“Approximately half of this amount is the lost income from the COVID-19–induced recession; the remainder is the economic effects of shorter and less healthy life.”
Commenting on the findings, David Rosenberg, chief economist at Rosenberg Research & Associates, concluded that the Fed alone would thus need to print $5 trillion of liquidity in 2021.
This would compound the feeling of unease which began with this year’s mass money printing, which has sent U.S. national debt over $27 trillion.
Rosenberg told Twitter followers to buy gold, but for Max Keiser, there is a clear alternative which makes more sense.
“Gold works, but #Bitcoin is THE FASTEST HORSE IN THE RACE,” he wrote in reply to Rosenberg.
Bitcoin hit highs of $11,690 on Tuesday before returning towards $11,400 at press time, still on monthly gains of 10.5% and year-to-date returns of 60%. As Cointelegraph reported, hopes are increasing that the short term will bring further upside, with even $17,000 coming into play should $12,000 be flipped to support.
From V-shaped to K-shaped
For the fiat economy, however, the picture is looking much bleaker, according to new comments from the International Monetary Fund (IMF).
Speaking to CNBC last week, IMF Managing Director Kristalina Georgieva said that the outlook for many countries was now not a V-shaped recovery but a K-shaped one.
“Most countries are going to be faced with uneven recovery and we see in many cases a ‘K,’ with parts of the economy doing really well, and other parts contracting dramatically,” she forecast.
For Keiser, this was a textbook definition of a phenomenon he calls “neofeudalism.” This involves the concentration of more of the world’s wealth closer to the state at the expense of those further away, creating the modern equivalent of lords and peasants.
“The extreme wealth concentration created by Covid becomes permanent. This would be a new Dark Ages,” he tweeted on Wednesday.
“Bitcoin fixes this.”