Tariff policy raises concerns in global markets, as it can lead to stagflation. Grayscale Research Head Zach Pandl discusses potential risks.
How Tariffs Slow Economic Growth
Zach Pandl notes that tariffs negatively impact economic growth by raising inflation. He states that they create a 'stagflation shock', slowing economic development and increasing inflation.
Impact of Historical Context on the Current Situation
Experts analyze recession risks and also consider the possibility of prolonged inflation. Reminiscing about events from the 1970s, such as the Arab oil embargo, investors seek alternative assets like gold and bitcoin. However, the current economic situation is different due to lower unemployment rates and better-managed inflation levels. Steve Sosnick, Chief Strategist at Interactive Brokers, highlights that we have not reached the severity of the shocks of the 1970s.
Prospects of Digital Assets and the Fed's Decisions
Bitcoin is attracting the attention of investors, especially if the dollar declines. The Fed discusses the possibility of lowering interest rates to maintain economic stability. Zach Pandl comments that such measures could serve as economic support.
Market conditions remain volatile, and diverse portfolios are more important than ever. Long-term strategies are proving essential for navigating today's complex economic landscape.
