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Mike Novogratz warns of US and global credit crunch – Fed expected to cut rates ‘sooner than we think’ – Economics

Galaxy Digital CEO Mike Novogratz has warned of a credit crunch in the US and around the world. He stresses that “we are headed for a recession” and expects the Federal Reserve to cut interest rates “sooner than we think”.

Novogratz on global credit crunch and recession

Galaxy Digital CEO Mike Novogratz shared his outlook for the US economy in an interview with CNBC on Wednesday. Comparing the current market situation to December 2018, he said: “It reminds me a lot of December 2018 when the Fed had this idea of ​​a last one [interest rate] surge and of course it sent the market into a tailspin and they had to reverse it soon after.”

Noting that “information has changed dramatically in a short period of time,” he stated:

The commodity market is telling you, the oil market is telling you, we’re headed for a recession. We’re going to have a credit crunch in the US and around the world.

Novogratz stressed that Federal Reserve Chair Jerome Powell “should take a break and will cut rates sooner than we think.” He added: “This is a big shift in psychology. Bitcoin (BTC) and Ethereum (ETH) are on the move.”

The executive continued, “If ever there was a time to be into bitcoin and crypto – that’s why it was created by governments printing too much money when the pain gets too much, and we’re seeing that.”

Asked if he sees “the possibility of contagion” in the U.S. banking system and globally, Novogratz reiterated, “There is contagion.” He added that people learn their lessons and end up relying on just four or five custodians become.

“I think Congress and the Fed need to do something more dramatic… or we’re going to see constant pressure on these regional banks and the entire system,” Novogratz concluded.

Now we have a market going into a credit crunch, how do banks raise capital? You lend less. You’re about to experience a credit crunch in the United States, and that’s starting to price itself into the market in dramatic ways.

What do you think of Mike Novogratz’ statements? Let us know in the comment section below.

Mike Novogratz warns of US and global credit crunch – Fed expected to cut rates ‘sooner than we think’ – Economics, Crypto Trading News

Kevin Helms

As an Austrian economics student, Kevin discovered Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open source systems, network effects and the interface between economics and cryptography.

photo credit: Shutterstock, Pixabay, WikiCommons

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Source: Crypto News Deutsch

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