Raoul Pal: “Crypto Is Macro Now” – Weak Global Economy Give Way For Crypto
According to Raoul Pal, a macro guru and ex-Goldman Sachs executive, a developing macro setup has appeared that could potentially send Bitcoin and other crypto assets into the completely new levels.
Pal, who is also the CEO of Real vision, shared in an interview with The Breakdown host Nathaniel Whittemore, how a weak global economy could serve as a catalyst for the growth of the crypto market.
“The macro setup is, I think, global growth comes out weaker for the next nine months. And I think that the Federal Reserve, even if they talk about tapering, will end up accelerating QE [quantitative easing]. That’s how I think this plays out. That’s what the bond market is telling you. Once crypto markets sniff this out, they’re going to explode. What we’ve got is a macro that’s potentially there.
Macro stories develop slowly. They’re not quick narratives. It’s month-by-month data. So we will see this over the next three months. But we will probably have a global slowdown.”
The weakening of the global economy could lead into some of the largest central banks to cut interest rates or engage in another round of money printing, Pal explains.
“We’ll probably have the Bank of Japan having to print for the reasons we’ve just talked about – that Japan’s totally screwed up the virus. They will do it in size. Chinese economy is in the toilet right now. They will probably do something. So we’ve got stimulus coming from Asia. Do the Fed do more? Do the Europeans do more? Generally, they have. They’ve generally cut rates twice after every recession. So they’re likely to do it again for a number of technical reasons.”
According to the expert, the combination of loose monetary policies and crypto’s sound money properties gives space for the “perfect setup” for the continuation of the bull market.
“So we have rate cuts, and this perfect setup with no supply, and demand in the middle of an exponential bull market. You don’t get these often in your life.”
