Timmer highlights how investors can prepare for a period of financial repression and generate returns in a high debt, low yield environment.
Stocks rebound after a disordered week where looming interest rate hikes curbed investors’ appetite for inflation-sensitive assets.
A strong dollar and deflationary pressures may have been this week’s downfall for commodities like gold. The US currency briefly reached a two-month high on Friday while gold slumped the lowest it has in over a month.
“(We) believe that the FED is only making the case for bitcoin stronger, as it doesn’t seem they’ve implemented any systems to curb inflation. This strengthens the idea behind a monetary system that can’t print dollars at will; the US has printed almost 25% of all circulating dollars in the last 16 months,” Michael Rabkin, head of institutional sales and global partnerships at DV Chain, wrote in a note to Blockworks.
Chair Jerome Powell announced that officials had begun discussing when to scale back $120 billion in monthly bond purchases, and released a ‘dot plot’ indicating two more interest rate hikes in 2023.