- Robert Kiyosaki in a recent tweet exclaimed that bitcoin along with gold and silver would be a safe hedge against ‘zombie debt’.
- The critically acclaimed famous writer for ‘Rich Dad, Poor Dad’, feels that the debt could rise to approximately $1.6 trillion in 2021.
- There have been cases of unusual correlation but crypto derivatives are a safe hedging tool.
Robert Kiyosaki in a recent tweet exclaimed that bitcoin along with gold and silver would be a safe hedge against ‘zombie debt’. The critically acclaimed famous writer for ‘Rich Dad, Poor Dad’, feels that the debt could rise to approximately $1.6 trillion in 2021. CEO’s of large corporations have been receiving financial support from the Fed, often not backed by a security. Now, these loans have become defunct and fallen off the credit report of the borrowers. However, the debt has risen from the grave and is somehow due on behalf of the borrowers.
FED is Ded. Loans to Zombie CEOs cannot be paid back. In 2020 Zombies owe $900 billion with decling income. By 2021 Zombie debt to pass $1.6 trillion. Got gold, silver, Bitcoin? “Accept what ever comes to you woven in the tapestry of your destiny.” Marcus Aurelius. Take care.
— therealkiyosaki (@theRealKiyosaki) June 28, 2020
Bitcoin as a Hedging tool
History is ripe with proof that there are no specific correlations between cryptocurrencies and regular asset classes. There have been cases of unusual correlation but crypto derivatives are a safe hedging tool. Over the years, digital currencies seem to have lost their volatility. Thus, allowing investors to diversify their portfolio and reduce their losses. Pooled liquidity will also provide benefits to those looking to safeguard their loans.
Bitcoin (BTC) has outperformed gold by more than double this year after it rose 37%. Several digital currencies promise stability and lesser correlation with regular asset classes. Bitcoin accounts for 0.4% of the world’s money while digital currencies on the other hand account for 0.7% of the total. It shows that there are few takers of the same and hence could provide stability.
It has outperformed stocks like the S&P 500 by 13% and MSCI All-Country World Index by 16%. The damage caused by the pandemic and the subsequent issue of stimulus packages in the United States has alarmed investors of an upcoming recession. The digital currencies offer a risk-reward ratio better than stocks, bonds, and gold.