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- While Writing framing this article, Bitcoin is trading at $ 19,240.
In an interview with CNBC, Paul Tudor Jones, a Billionaire investor and renowned hedge fund manager, acknowledges that the U.S economy is either near or already in the middle of a depression as the Federal Reserve bolts to tame rising expansion with aggressive rate hikes.
Paul said, “I don’t know whether it started now or it started months ago.” He added, “We always find out, and we are always surprised when the recession officially starts,but I’m assuming we are going to go into one.”
The National Bureau of Economy Research is the official mediator of recession and uses several factors to determine its determination. The National Bureau defines a recession as a “significant decline in the economy and lasts more than a few months.” Regardless, the economists of the bureau are also not to use GDP as a primary barometer.
Despite H1 and H2 of the financial year, the country’s economy severely declined, and the report of H3 is likely to be published on 27 October 2022.
The CIO(Chief Investment Officer) and Founder of Tudor investment noted a typical recession playbook for the guide investors. History shows more space to fall before colliding with the risky property.
Paul mentioned, “Most recessions last about 300 days from the commencement of it,” and added, “The stock market is down, say, 10%. The first thing that will happen is short rates will stop going up and start going down before the stock market bottoms.”
The popular investor stated that bringing Inflation back to its 2% target for the Fed is challenging due to increasingly significant wages.
Paul quoted, “Inflation is a bit like toothpaste. Once you get it out of the tube, it’s hard to get it back in.” Adding more, he said, “The Fed is furiously trying to wash that taste out of their mouth. … If we go into recession, that has really negative consequences for a variety of assets.”
The Fed has been tightening its most aggressive motion to fight Inflation since the 1980s. The Central Bank increased the the-fourth point for the third time last month, leading to a higher increase. Paul noted that the FED should tighten to avoid prolonged economic pain.
In the end, supporting his statement, Paul mentioned, “If they don’t keep going and we have high and permanent inflation, it just creates I think more issues down the road.” “If we are going to have long-term prosperity, you have to have a stable currency and a stable way to value it. So yes you have to have something 2% and under Inflation in the very long run to have a stable society. So there’s short-term pain associated with long-term gain.”
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
