Mike Novogratz Sounds the Alarm on Upcoming Credit Crunch
Mike Novogratz, founder of Galaxy Digital, recently sounded the alarm on a potential credit crunch happening in the United States and globally. He believes the Federal Reserve may need to step in and cut interest rates sooner than most people think.
What Is a Credit Crunch?
A credit crunch is a situation where banks and lenders are unwilling or unable to provide large amounts of credit. In other words, borrowing becomes difficult and the economy suffers as a result.
Novogratz’s Warning from the Crypto World
Novogratz, who made his fortune in the crypto world, believes the current situation could be headed for a credit crunch because of trade wars and uncertainty in the global economy. He also said that it could be “worse than we even think”.
Fed to Restrain the Situation?
Novogratz believes the Federal Reserve will eventually step in and help restrain the situation. He believes that the Fed will need to cut interest rates “sooner than we think”.
What Does This Mean For the Average Consumer?
A looming credit crunch means that if you’re in the market for a loan, whether it’s a car loan, student loan, or home loan, you may need to prepare for higher interest rates should things take a turn for the worst.
The Takeaway
While it’s still too early to tell what the future holds, it’s never a bad idea to be financially prepared for a potential downturn. Store up a little cash, pay off some of your debts and look for good deals when you do need to borrow money. And oh yeah, don’t forget to laugh — it’s good for the soul!
