Economic Lockdown/House Arrest… Beneficiaries: Bitcoin, Gold, Stocks

By Dr. Chris Kacher of Hanse Digital Access, KJA Digital Asset Investments and Virtue of Selfish Investing on The Capital

Second and Third Order Consequences

As I’ve written in prior reports, second order consequences of the economic lockdown are numerous. Demand shocks across various industries are inevitable. On Monday, we saw crude oil make pricing history. Storage capacity of oil went to virtually zero along with a demand shock for oil caused by the economic lockdown. Many of the world’s major economies have sent crude demand tumbling by as much as a third, leaving the industry facing what Jefferies analyst Jason Gammel called “the bleakest oil macro outlook” he had ever seen.

Bitcoin Whipping Boy

Mainstream media loves to jump on bitcoin when it comes to price moves as if they are equivalent to moves in the major averages. A log plot shows how a 46% correction in the S&P 500 is massive relative to its prior uptrend, while a 50% correction in bitcoin is a tiny blip.

Bitcoin Bathwater Babies

When everything, including gold and bitcoin, plunged in March, it was reminiscent of late 2008 when gold lost one-third of its value. But some of my metrics signaled at least an intermediate low in bitcoin on March 13 which was the first to rebound compared to gold and stocks as I wrote on March 17.



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Hanse Digital Access, KJA Digital Asset Inv. & VSI

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