Bad News for the Dollar, Good News for Crypto & Precious Metals
It looks like there’s bad news for the dollar and good news for crypto and precious metals investors. Rumors have been swirling about a new round of quantitative easing from the Federal Reserve, and it looks like this speculation may actually be true.
Quantitative Easing – What It Is, and Why It’s Bad News for the Dollar
Quantitative easing (QE) is a form of economic stimulus in which a central bank like the US Federal Reserve pumps money into the economy by buying government bonds and other financial assets. This increases the money supply, which can help boost markets, provide some liquidity, and lower interest rates.
However, QE is widely considered to be inflationary, as it increases the money supply without increasing production – this can lead to higher prices in the economy as well as a decrease in the buying power of the dollar.
Crypto & Precious Metals Seek Refuge from Fed Policies
It looks like investors have been taking refuge from the prospect of inflationary policies by investing in crypto and precious metals. BTC is up more than 3% over the past day and has surpassed the $10,000 mark. Precious metals have also seen significant gains, with gold and silver rising by 1.4% and 2.7% respectively.
Other safe havens also benefited from the news, with the Japanese yen and the Swiss franc appreciating against the US dollar.
What Can We Expect Going Forward?
It looks like investors are closely watching the Fed’s next moves. A potential policy change could mean more money put into the economy and higher inflation, which could cause the US dollar to weaken and make investments in precious metals and cryptocurrencies more attractive.
It remains to be seen how events will unfold, but one thing is for sure – the next round of bailouts is here, and it looks like crypto and precious metals are the beneficiaries.
Avoiding the Fed’s Policies
If you’re an investor looking to steer clear of the Fed’s policies, there are a few things you can do.
- Invest in Assets That Will Hold Their Value: By investing in assets like gold, silver, and cryptocurrencies, you can ensure that your investments will hold their value no matter what happens with the US dollar.
- Look for Alternative Investment Opportunities: Consider investing in alternative asset classes that don’t rely on traditional markets for their performance. For example, investing in foreign currencies or real estate outside of the US can be a great way to diversify and protect against inflation.
- Stick to the Basics: When all else fails, it can be helpful to stick to the basics of financial literacy. Make sure to save your money, diversify your portfolio, and maintain a healthy debt-to-income ratio. These steps can help ensure that you don’t get caught off guard when markets change.
Looking Ahead
Despite the bad news for the US dollar, the news isn’t all bad for investors. Crypto and precious metals have seen huge gains over the past few days, and if things continue as they are, this could be a great opportunity for those looking to diversify their portfolios.
At the same time, it’s important to remember to stick to the basics when investing, and be sure to consider alternative investments to the traditional markets, if you’re looking to hedge against potential Fed policies.
So be smart, do your research, and above all, don’t panic – with a bit of caution and a great investment strategy, you can come out on top in any market.
