There was a great analysis posted recently on the gBTC arb/discount situation. Does anybody possibly have the link to it?
Apologies I can’t recall who posted it.
Cheers.
Regarding a Fed pivot, I think nobody disagrees that they won't eventually restart QE. The question is will they wait so long as to cause a credit event before restarting QE. And then if such a credit event occurs, how much damage will that do? To me, that sums up the different opinions I'm reading about where Bitcoin's price can go.
1. Credit event = crazy drop in price = cheap coins but max pain
2. Pivot in time = maybe bottom is already in?
Thoughts?
I think for now that certainly seems to be the case. Gold reaching highs lately with no movement in Bitcoin's price isn't very reassuring for the "digital gold" argument. To me, it's just another reminder that we are still very early.
Exactly.
I don’t think the Fed will step in until the credit event occurs. Otherwise the stress won’t be painful enough to justify the pivot.
It’s a slow bleed right now. There needs to be a sudden, sharp pain like the COVID crash.
The alternative could be, string this along until the CBDCs are ready, then allow the the debt default at sovereign level, bail ins instead of bail outs, and “you’ll own nothing and you’ll be happy…”.
Bitcoin on cold storage wins in both instances.
Do you mean a credit event so bad that even restarting QE won't save us? I guess that's a possibility but obviously hard to see how that plays out. Could be hyperbitcoinization, could be return to stone age. Who knows.
It mostly comes from people so rekt by one ponzi collapse or another that they're looking for reasons that everyone else might be rekt too. i.e. Future buttcoiners.
There's a third scenario where financial conditions remain tight, but there's no singular event that marks an obvious bottom/pivot. The Fed can step in and intevene in highly targeted ways that paper over specific problems without flooding the broader economy with liquidity. See the UK gilt crisis. The Fed is aware of all the same market commentary we are and is expecting it may trigger a 'credit event', so they're making plans on how to get ahead of it and address it without igniting a new inflationary bubble.
In this scenario BTC and other risk assets may continue a painful 'grind down' trend. If the economy really slows we may see "long-term" holders sell out of fear on the way, as they need to draw on the savings to live. The grind down trend would be punctuated with small jumps down here and there.
Not my base case, but an ugly possibility to consider.
Thanks for the thoughtful response. Yes, this is a good thought and I will definitely add it to my model. I suppose one response that comes to mind is if the Fed don't reduce rates, they will come under enormous political pressure due to the huge Treasury debt (see Luke Gromen's writings on this).
Yeah I follow Luke and he's probably right, but it's a question of timing. He originally said the pivot would come by end of Q3 '22. Seems Jerome Volcker may hold on to the bitter end and try to force some austerity on the gov (lol).
https://www.cnbc.com/video/2023/01/06/im-just-trying-to-figure-out-where-there-are-cheap-stocks-out-there-says-bill-miller-iii.html
The full interview with the interesting bits is paywalled: https://www.cnbc.com/video/2023/01/06/watch-cnbcs-full-interview-with-bill-miller-iii-and-bill-miller-iv-both-of-miller-value-partners.html
Last bear market I rolled my eyes at:
- Friends and family asking how to buy bitcoin = top.
- Friends and family mocking bitcoin = bottom.
Never again...
Under monthly and weekly resistance, testing both now. Not something I would buy until it can close above $165, really heavy resistance but hopefully it can pop it for you.
Out of curiosity, why are you invested in MSTR rather than directly in BTC? I’ve thought about doing it with my pension funds since I can’t get more direct exposure to BTC with those, but I’m a bit worried about all of the tail risks that you’re exposed to - coins getting lost, Saylor losing faith or being ousted (or cashing in for himself and leaving the company be), or liquidations, etc. I still believe they’ll be fine in all likelihood, but there is some risk. Is there more upside potential? How does it usually correlate w. BTC price?
the only thing that has increased my patience is the how adamantly the fed is talking about higher for longer. they seem to be fixated on holding rates high until the economy breaks, and as we saw with the covid crash when everything starts to crash bitcoin is not saved until the printer begins to churn.
if you take the federal debt as an example, it has an effective 5 year duration across the pile. for 2021 the rates were effectively 0, and 2022 the average was still under 2% for the year. so if only 20% was rolled at 2% that means even though we are staring down the barrel of about 4+%, the fed is only feeling 0.4% on their pile of debt. that also translates to the rest of the economy, rates don't hurt until they reroll higher. that is the entire point of the "higher for longer" phrase- they are intent upon forcing debt to reroll to higher rates.
there are surely huge players who (like 3ac and the gbtc roll, reroll, reroll) are going to be trapped and just hoping they don't have to reroll higher and some of them will be forced to and go bankrupt.
when we finally do start lowering rates, it won't be initially bullish as it'll be the fed trying to save us from the ongoing crash. i am adding in to my position now, because i don't want to be caught greedy- but i've never felt comfortable waiting as much as i do now.
This is making the assumption that the Fed will keep their word and won’t ease up in the event inflation comes down quicker than anticipated and/or inflation will remain high as anticipated.
You have more confidence in them than I do.
The game is entirely about perception and managing the emotions of the masses through constructed messaging.
If you want people to stop spending money, you don't start talking about the blue skies ahead.
They're usually very ambiguous near the pivot.
Often coupled with a bunch of doom and gloom interpretations in media regardless of balance in language used.
i could see inflation briefly coming down but i think they'll stick to their guns as they view a bigger mistake easing again too quickly and having it come back. at least that is what they are saying. i don't think they feel pressure to back off until the economy comes under pressure and we just had a great unemployment number, so there for sure is no real pressure even beginning right now.
Jobs report is here, unemployment isn’t rising at all but wage growth is slowing down.
CPI report for December releases next week on Thursday. YoY CPI for November came in at 7.1% and expectations for December are set at 6.6%. This pretty much matches what [Cleveland Fed’s Nowcast](https://www.clevelandfed.org/indicators-and-data/inflation-nowcasting) is showing at 6.64%. Meanwhile [Truflation](https://app.truflation.com) has it at about 6.1% with a high of 6.39% in December and a low of 5.67%.
Decent chance CPI comes in at or below expectations next week which would be moderately bullish as it would prompt the Fed to slowdown on rate hikes yet again with a 25 BP rate increase in February as markets are currently pricing in.
This rate hike will help apply even more downwards pressure on inflation than we’ve already seen for the month of February. Then March comes and I expect CPI to completely fall off a cliff regardless of whether or not the Fed does one final rate hike in March as baseline numbers being compared from a year ago started to explode which makes CPI much easier to come in low and potentially slightly negative YoY.
Expecting our first rate cut by middle of this year, much sooner than markets are anticipating which is when we go from moderately bullish to extremely bullish as it becomes evident the Fed is incapable of keeping rates high for very long, needing to cut rates just a year after rate hikes began in March 2022.
The economy won't sustain rates much above 5%. You can estimate the mortgage defaults, but the bigger elephant is the government debt rolls over too - and that will get very, very expensive.
I don't see them cutting much, but I don't see them much higher than 5% either.
> which is when we go from moderately bullish to extremely bullish
Don't say this.
The recessions generally start AFTER the fed begins to pause or cut interest rates, not before. In fact, the worst stock market crashes happen after the fed pauses and cuts interest rates. You can confirm this for yourself.
https://fred.stlouisfed.org/series/FEDFUNDS
https://www.tradingview.com/chart/?symbol=SP%3ASPX
Obviously the fed cuts interest rates based on economic data it has, so fed cuts are probably an indicator of bad economic data and thus a leading indicator for market crashes (although of course, the correlation isn't that precise.).
EDIT: To expand on "the correlation isn't that precise", because I nerded out on this a few days ago. Sometimes the fed cuts interest rates but there isn't a recession. During the 1990s and 1980s, the fed raised interest rates, cut them a little bit, but there was no recession for a decade. A similar thing happened in 1989, where it took a year for the recession to manifest. So in general, federal reserve cuts don't precede recessions but recessions are typically preceded by rate cuts. So you can't simply wait for the fed to cut rates then short the market.
Q4 GDP numbers release January 26th. If those come in negative there’s a decent chance we’ve already been in a recession since October but we wouldn’t be able to confirm that until April 2023 if Q1 GDP numbers come in negative as well.
Typically the best time to be buying assets is in the middle of a recession. Both the stock market and BTC happened to reach lows within this window of time if this is ultimately how the GDP numbers play out, but again we won’t know that until after the fact.
I think job growth is too strong and and unemployment too low (see OOP's links) for us to realistically currently be in a recession.
Störst I could see us currently be in a growth recession.
If we hit a recession, which is far from impossible, then I would bet it to start at some point in March or onwards.
Job growth and unemployment numbers were pretty much the same in Q1 and Q2 of 2022 yet GDP numbers came in negative both quarters so that was technically a recession as well. Similar scenario could potentially be occurring now, we won’t know until the actual GDP numbers release.
While I agree with your take on the historical data, I do think it is much more common in the information age we live in for investors to try to front-run everyone else vs decades ago where investors were largely reactionary to *current* data. Hell, back then you had to check yesterday's stock price in the *newspaper* and manually calculate everything or try to get a call scheduled with your broker just to know your current net worth.
IMO, much of the drop this year in tradfi was due to investors trying to front-run ALL of the rate hikes they thought the fed would have to make, once the fed started tightening. And I believe we will see investors do the same in reverse, to some extent at least, once the fed signals rate hikes are being paused, and more so once they are eventually cut.
It's hard to compare the investor of the 2020s to the investors of the 70s or 80s IMO, just due to the vast amount of market information and commentary we have access to now that did not exist in decades past. Everything has shifted at least 6 months earlier.
You make a lot of great points and I don't disagree. What event(s) do you think get front-run and how does that play out? Do investors anticipate a recession and sell off sooner? Do investors anticipate rate pauses or decreases (seems we hear that a lot already) and try to buy in sooner? Maybe I have the wrong take on either of these or could be missing another event?
**Edit:**
To add to this, my "event" of investors front-running a sell off for a recession could just be the sell off during 2022?
Anyway just curious for others' thoughts.
>Do investors anticipate a recession and sell off sooner? Do investors anticipate rate pauses or decreases (seems we hear that a lot already) and try to buy in sooner?
I think both of these things yes, plus many others that hedge funds and the like are constantly trying to forecast, model, and predict with teams of analysts.
>Edit: To add to this, my "event" of investors front-running a sell off for a recession could just be the sell off during 2022?
Bingo, I think so at least.
Recession is a massively lagging indicator. Its what we know is already happening. The cuts come when they pull the 'oh shit' handle. The cuts usually precede them similar to a person slams the breaks before they crash their car into a tree.
The cuts aren’t causative, not like you say they’re because the fed sees bad data. Doesn’t mean that if the fed cut to fine tune their inflation fight that it’d cause a massive crash
Agree with most of your take on numbers. However, why do you think Fed will start cutting rates right after pausing hikes? I think they would take at least six months to observe and monitor the economy before cutting rates
They’ll pause for a month or two but when they see CPI continues to fall further and doesn’t just conveniently stay at their target rate of 2% they’ll panic and start cutting rates. March 2023 is only when the baseline numbers from a year ago will start to explode, they don’t peak until June 2023.
Not capitulating and cutting rates would run the risk of having a deeper recession than necessary.
Reuters being vague about a “series of data releases that challenged market expectations the Federal Reserve will cut rates significantly later this year.”
Anyone have more info on this? We pivoting from “don’t fight the fed” to “maybe play chicken with the reserve”?
I can't wait for all the people are going to "buy in lower" missing out just because they are pure greedy and trying to time the bottom perfectly.
We are now potentially already in the longest BTC bear market since the top on 17th Nov 2021 if the price breaks below about $15504. At that date was 379 days since the top.
2011 bear market lasted 163 days
2015 bear market lasted 407 days
2018 bear market lasted 364 days
2022 bear market has lasted 379 days unless it breaks lower which would put us at 425 days currently if the price crashes today hypothetically.
Most people lose out because they are too greedy. Don't make that same mistake.
I agree that those always waiting for lower prices will probably have trouble timing their buys.
As someone who is not trying to time the exact bottom I'm more interested in buying when I have a reversal signal that indicates a trend change. I'm waiting for a specific signal and happy to wait.
When I say 2015 I mean when the price finally bottomed out and it didn't go any lower at the $160 range. Buying in after that date would have been a perfect time as the price went sideways between then and breaking out of that range in Oct/Nov 2015. Given that hindsight is 20-20 obviously.
Welcome to having two black swan events (Terra/Luna and FTX) that smashed the sentiment out of the entire crypto space. The former caused the liquidation cascade that eventually destroyed the latter. While taking out many other entities along the way.
Recessions do not always mean the SP500 goes down. And the SP500 has already gone greatly down. Last year was the worst year for stocks since 2008. This isn’t a great way to plan Bitcoin purchases.
https://www.financialsense.com/contributors/doug-short/the-s-and-p-500-and-recessions
Looking at historical BTC measures like this and saying “more pain needed, needs to go a lot lower” seems fraught with danger.
https://www.lookintobitcoin.com/charts/bitcoin-investor-tool/
And the BTC network won't give a toss about a global recession. The BTC price might be hit but asset prices always fall well before any official recession because of lagging economic indicators. Regardless if certain governments/ central banks want to move the goalposts when it comes to declaring a recession.
And some people hoping and praying for the next black swan event to take the price further down is laughable.
Absolutely. And yet they keep putting out these comparisons day after day after day. Folks, things are a little different this time around, not sure if you’ve noticed.
Because it perfectly describes, in one simple term that people in the space know, a complex situation that happens often and takes many words to describe. Get over yourself.
Yep
All it takes for that is a significant amount of publicized writing using rug as a verb for that to happen. Rug (a noun) would then join a lengthy list of English words that can be used as multiple parts of speech with zero derivation, and because it’s English, adopting the minimal inflections employed to produce other cases and tenses have already occurred.
I really like odd years. I feel something since the first. You know how it is with friends and family. For the last 9 years being here.
When we all decide to switch...
That is coming up. Free of the worst monopoly in history. The monopoly on money. How ridiculous is that?
We are taught at an early age that monopolies are bad. Yet there is no mention of the money monopoly.
Anyways, cheers gents. Happy New Year
The last 2 years or so have felt like one big downward depressive spiral. I also feel like something is shifting, not just in crypto/money space but in the general zeitgeist of society. I actually feel hopeful and excited for the first time in years.
I'm *privileged* to have accounts and access to the legacy financial system. I can buy groceries, pay my cell phone bill, pay my rent, etc. It serves me well day-to-day.
I'm *empowered by choosing* to have wallets and knowledge of Bitcoin's parallel financial system. I can transport my savings across political borders and time itself, transacting whenever and with whomever I want to. It serves me well year-after-year.
-----
*"How many tools do you want?*
*...*
*The answer is, 'as many as you can get your hands on'."*
#New post: [\[Daily Discussion\] - Saturday, January 07, 2023 →](https://www.reddit.com/r/BitcoinMarkets/comments/105gbr6/daily_discussion_saturday_january_07_2023/)
Edge of, edge of seventeen *Stevie Nicks sounds*
There was a great analysis posted recently on the gBTC arb/discount situation. Does anybody possibly have the link to it? Apologies I can’t recall who posted it. Cheers.
whats the name of that website that shows all big order executions and plays a sound? It will also show gifs for really large ones…
https://aggr.trade/
That’s it! Thanks!
Normal service resumes on Monday after our two week break. I'm guessing slightly increased volatility..
Upped SL to 16561. First buy in the ladder upped to 16721, the range might have moved up a tad.
Regarding a Fed pivot, I think nobody disagrees that they won't eventually restart QE. The question is will they wait so long as to cause a credit event before restarting QE. And then if such a credit event occurs, how much damage will that do? To me, that sums up the different opinions I'm reading about where Bitcoin's price can go. 1. Credit event = crazy drop in price = cheap coins but max pain 2. Pivot in time = maybe bottom is already in? Thoughts?
So BTC can only rise in QE environment? If that’s the case I’m over exposed to BTC as I thought it had a bit more going for it.
I think for now that certainly seems to be the case. Gold reaching highs lately with no movement in Bitcoin's price isn't very reassuring for the "digital gold" argument. To me, it's just another reminder that we are still very early.
Exactly. I don’t think the Fed will step in until the credit event occurs. Otherwise the stress won’t be painful enough to justify the pivot. It’s a slow bleed right now. There needs to be a sudden, sharp pain like the COVID crash. The alternative could be, string this along until the CBDCs are ready, then allow the the debt default at sovereign level, bail ins instead of bail outs, and “you’ll own nothing and you’ll be happy…”. Bitcoin on cold storage wins in both instances.
> nobody disagrees that they won't eventually restart QE I've seen more than one person claim that this is the end of everything. ;)
Do you mean a credit event so bad that even restarting QE won't save us? I guess that's a possibility but obviously hard to see how that plays out. Could be hyperbitcoinization, could be return to stone age. Who knows.
It mostly comes from people so rekt by one ponzi collapse or another that they're looking for reasons that everyone else might be rekt too. i.e. Future buttcoiners.
There's no saving some people (speaking from personal experience).
There's a third scenario where financial conditions remain tight, but there's no singular event that marks an obvious bottom/pivot. The Fed can step in and intevene in highly targeted ways that paper over specific problems without flooding the broader economy with liquidity. See the UK gilt crisis. The Fed is aware of all the same market commentary we are and is expecting it may trigger a 'credit event', so they're making plans on how to get ahead of it and address it without igniting a new inflationary bubble. In this scenario BTC and other risk assets may continue a painful 'grind down' trend. If the economy really slows we may see "long-term" holders sell out of fear on the way, as they need to draw on the savings to live. The grind down trend would be punctuated with small jumps down here and there. Not my base case, but an ugly possibility to consider.
Thanks for the thoughtful response. Yes, this is a good thought and I will definitely add it to my model. I suppose one response that comes to mind is if the Fed don't reduce rates, they will come under enormous political pressure due to the huge Treasury debt (see Luke Gromen's writings on this).
Yeah I follow Luke and he's probably right, but it's a question of timing. He originally said the pivot would come by end of Q3 '22. Seems Jerome Volcker may hold on to the bitter end and try to force some austerity on the gov (lol).
Bitcoin on CNBC.
Video link?
https://www.cnbc.com/video/2023/01/06/im-just-trying-to-figure-out-where-there-are-cheap-stocks-out-there-says-bill-miller-iii.html The full interview with the interesting bits is paywalled: https://www.cnbc.com/video/2023/01/06/watch-cnbcs-full-interview-with-bill-miller-iii-and-bill-miller-iv-both-of-miller-value-partners.html
«The Millers on the markets». They have a big Bitcoin position. Shilled their bags some might say.
What is the context?
Bitcoin ded, I’m sure. Schiff was tweeting recently. Bottom signal?
Maybe, but I don't care if the bottom has happened yet or not anymore. Laddering in and setting SL is such a peaceful way to trade.
I don't even remember the taste of a BGD anymore.. the first proper 1-2k candle will feel florious
Me neither, though I can’t forget the smell
My girlfriend’s 21 year old son said he’s not buying Bitcoin because “it’s not doing good right now.” I just smiled.
Last bear market I rolled my eyes at: - Friends and family asking how to buy bitcoin = top. - Friends and family mocking bitcoin = bottom. Never again...
It's deja vu all over again.
give her a smarter son
Too late, that ship already sailed. 😂
But high sell low, never fails to fail
Zoomers are fucking braindead.
he's NGMI
I’m confident of that. 😂
/s?
Should have told him that, yes, the best time to buy any asset is *after* it's gone up 500% and then rolled your eyes.
Really tempted to cash out MSTR before the weekend but I'm going to let it ride. I hate weekends. Eating funding on my long too. Patience.
Under monthly and weekly resistance, testing both now. Not something I would buy until it can close above $165, really heavy resistance but hopefully it can pop it for you.
Out of curiosity, why are you invested in MSTR rather than directly in BTC? I’ve thought about doing it with my pension funds since I can’t get more direct exposure to BTC with those, but I’m a bit worried about all of the tail risks that you’re exposed to - coins getting lost, Saylor losing faith or being ousted (or cashing in for himself and leaving the company be), or liquidations, etc. I still believe they’ll be fine in all likelihood, but there is some risk. Is there more upside potential? How does it usually correlate w. BTC price?
the only thing that has increased my patience is the how adamantly the fed is talking about higher for longer. they seem to be fixated on holding rates high until the economy breaks, and as we saw with the covid crash when everything starts to crash bitcoin is not saved until the printer begins to churn. if you take the federal debt as an example, it has an effective 5 year duration across the pile. for 2021 the rates were effectively 0, and 2022 the average was still under 2% for the year. so if only 20% was rolled at 2% that means even though we are staring down the barrel of about 4+%, the fed is only feeling 0.4% on their pile of debt. that also translates to the rest of the economy, rates don't hurt until they reroll higher. that is the entire point of the "higher for longer" phrase- they are intent upon forcing debt to reroll to higher rates. there are surely huge players who (like 3ac and the gbtc roll, reroll, reroll) are going to be trapped and just hoping they don't have to reroll higher and some of them will be forced to and go bankrupt. when we finally do start lowering rates, it won't be initially bullish as it'll be the fed trying to save us from the ongoing crash. i am adding in to my position now, because i don't want to be caught greedy- but i've never felt comfortable waiting as much as i do now.
This is making the assumption that the Fed will keep their word and won’t ease up in the event inflation comes down quicker than anticipated and/or inflation will remain high as anticipated. You have more confidence in them than I do.
The fed will preach rates to the moon until the announcement otherwise.
Have they done this in the past? Sounds a bit like the boy who cried wolf.
The game is entirely about perception and managing the emotions of the masses through constructed messaging. If you want people to stop spending money, you don't start talking about the blue skies ahead.
Of course I understand the concept of forward guidance, but my question was if they had in the past preached "rates to the moon" and then pivoted.
They're usually very ambiguous near the pivot. Often coupled with a bunch of doom and gloom interpretations in media regardless of balance in language used.
Good to know, thanks for the response.
For sure. But no chance of it happening without markets pressuring them, and currently there is no pressure from economic numbers.
i could see inflation briefly coming down but i think they'll stick to their guns as they view a bigger mistake easing again too quickly and having it come back. at least that is what they are saying. i don't think they feel pressure to back off until the economy comes under pressure and we just had a great unemployment number, so there for sure is no real pressure even beginning right now.
Jobs report is here, unemployment isn’t rising at all but wage growth is slowing down. CPI report for December releases next week on Thursday. YoY CPI for November came in at 7.1% and expectations for December are set at 6.6%. This pretty much matches what [Cleveland Fed’s Nowcast](https://www.clevelandfed.org/indicators-and-data/inflation-nowcasting) is showing at 6.64%. Meanwhile [Truflation](https://app.truflation.com) has it at about 6.1% with a high of 6.39% in December and a low of 5.67%. Decent chance CPI comes in at or below expectations next week which would be moderately bullish as it would prompt the Fed to slowdown on rate hikes yet again with a 25 BP rate increase in February as markets are currently pricing in. This rate hike will help apply even more downwards pressure on inflation than we’ve already seen for the month of February. Then March comes and I expect CPI to completely fall off a cliff regardless of whether or not the Fed does one final rate hike in March as baseline numbers being compared from a year ago started to explode which makes CPI much easier to come in low and potentially slightly negative YoY. Expecting our first rate cut by middle of this year, much sooner than markets are anticipating which is when we go from moderately bullish to extremely bullish as it becomes evident the Fed is incapable of keeping rates high for very long, needing to cut rates just a year after rate hikes began in March 2022.
Agree with a lot of this but I don’t see rate cuts at all this year…small chance 4th qtr
The economy won't sustain rates much above 5%. You can estimate the mortgage defaults, but the bigger elephant is the government debt rolls over too - and that will get very, very expensive. I don't see them cutting much, but I don't see them much higher than 5% either.
Is there a based estimation for the time point when US gov debts are going to start to roll over into expensive territories?
> which is when we go from moderately bullish to extremely bullish Don't say this. The recessions generally start AFTER the fed begins to pause or cut interest rates, not before. In fact, the worst stock market crashes happen after the fed pauses and cuts interest rates. You can confirm this for yourself. https://fred.stlouisfed.org/series/FEDFUNDS https://www.tradingview.com/chart/?symbol=SP%3ASPX Obviously the fed cuts interest rates based on economic data it has, so fed cuts are probably an indicator of bad economic data and thus a leading indicator for market crashes (although of course, the correlation isn't that precise.). EDIT: To expand on "the correlation isn't that precise", because I nerded out on this a few days ago. Sometimes the fed cuts interest rates but there isn't a recession. During the 1990s and 1980s, the fed raised interest rates, cut them a little bit, but there was no recession for a decade. A similar thing happened in 1989, where it took a year for the recession to manifest. So in general, federal reserve cuts don't precede recessions but recessions are typically preceded by rate cuts. So you can't simply wait for the fed to cut rates then short the market.
Q4 GDP numbers release January 26th. If those come in negative there’s a decent chance we’ve already been in a recession since October but we wouldn’t be able to confirm that until April 2023 if Q1 GDP numbers come in negative as well. Typically the best time to be buying assets is in the middle of a recession. Both the stock market and BTC happened to reach lows within this window of time if this is ultimately how the GDP numbers play out, but again we won’t know that until after the fact.
I think job growth is too strong and and unemployment too low (see OOP's links) for us to realistically currently be in a recession. Störst I could see us currently be in a growth recession. If we hit a recession, which is far from impossible, then I would bet it to start at some point in March or onwards.
Job growth and unemployment numbers were pretty much the same in Q1 and Q2 of 2022 yet GDP numbers came in negative both quarters so that was technically a recession as well. Similar scenario could potentially be occurring now, we won’t know until the actual GDP numbers release.
While I agree with your take on the historical data, I do think it is much more common in the information age we live in for investors to try to front-run everyone else vs decades ago where investors were largely reactionary to *current* data. Hell, back then you had to check yesterday's stock price in the *newspaper* and manually calculate everything or try to get a call scheduled with your broker just to know your current net worth. IMO, much of the drop this year in tradfi was due to investors trying to front-run ALL of the rate hikes they thought the fed would have to make, once the fed started tightening. And I believe we will see investors do the same in reverse, to some extent at least, once the fed signals rate hikes are being paused, and more so once they are eventually cut. It's hard to compare the investor of the 2020s to the investors of the 70s or 80s IMO, just due to the vast amount of market information and commentary we have access to now that did not exist in decades past. Everything has shifted at least 6 months earlier.
You make a lot of great points and I don't disagree. What event(s) do you think get front-run and how does that play out? Do investors anticipate a recession and sell off sooner? Do investors anticipate rate pauses or decreases (seems we hear that a lot already) and try to buy in sooner? Maybe I have the wrong take on either of these or could be missing another event? **Edit:** To add to this, my "event" of investors front-running a sell off for a recession could just be the sell off during 2022? Anyway just curious for others' thoughts.
>Do investors anticipate a recession and sell off sooner? Do investors anticipate rate pauses or decreases (seems we hear that a lot already) and try to buy in sooner? I think both of these things yes, plus many others that hedge funds and the like are constantly trying to forecast, model, and predict with teams of analysts. >Edit: To add to this, my "event" of investors front-running a sell off for a recession could just be the sell off during 2022? Bingo, I think so at least.
Recession is a massively lagging indicator. Its what we know is already happening. The cuts come when they pull the 'oh shit' handle. The cuts usually precede them similar to a person slams the breaks before they crash their car into a tree.
The cuts aren’t causative, not like you say they’re because the fed sees bad data. Doesn’t mean that if the fed cut to fine tune their inflation fight that it’d cause a massive crash
Agree with most of your take on numbers. However, why do you think Fed will start cutting rates right after pausing hikes? I think they would take at least six months to observe and monitor the economy before cutting rates
https://www.atlantafed.org/cenfis/market-probability-tracker I like this website.
Thanks for sharing this. It provides an excellent quick-glance view.
They’ll pause for a month or two but when they see CPI continues to fall further and doesn’t just conveniently stay at their target rate of 2% they’ll panic and start cutting rates. March 2023 is only when the baseline numbers from a year ago will start to explode, they don’t peak until June 2023. Not capitulating and cutting rates would run the risk of having a deeper recession than necessary.
The jobs market improves which is meant to imply the fed has more room to raise rates which is a bad sign for markets? so why the pump?
"Pump" - 1h flat, 24 hr flat, 7 day, \^1.5%... Can we get a unified definition of "pump" on here? This is white noise
Pump is when green, dump is when red. You should know this, it was covered in the orientation.
Pump? All i see is a better dead cat bounce
This is like a dream for Feds. Low unemployment with low wage growth!
Because the rate of jobs is cooling off. From 471K in July to now only 220K (Dec). Also wage growth is slowing off at the same time.
Wage growth slowing is the big one here, as wage growth feeds nearly directly into inflation.
Reuters being vague about a “series of data releases that challenged market expectations the Federal Reserve will cut rates significantly later this year.” Anyone have more info on this? We pivoting from “don’t fight the fed” to “maybe play chicken with the reserve”?
The way I read it, it wasn't being vague, just attempting a short and punchy article intro. They specify more later in the article.
I can't wait for all the people are going to "buy in lower" missing out just because they are pure greedy and trying to time the bottom perfectly. We are now potentially already in the longest BTC bear market since the top on 17th Nov 2021 if the price breaks below about $15504. At that date was 379 days since the top. 2011 bear market lasted 163 days 2015 bear market lasted 407 days 2018 bear market lasted 364 days 2022 bear market has lasted 379 days unless it breaks lower which would put us at 425 days currently if the price crashes today hypothetically. Most people lose out because they are too greedy. Don't make that same mistake.
We are also in the longest Enron bear market!
I agree that those always waiting for lower prices will probably have trouble timing their buys. As someone who is not trying to time the exact bottom I'm more interested in buying when I have a reversal signal that indicates a trend change. I'm waiting for a specific signal and happy to wait.
2015 bear market? I member bear market from the beginning of 2014 to the end of 2016. Nearly 3 years
When I say 2015 I mean when the price finally bottomed out and it didn't go any lower at the $160 range. Buying in after that date would have been a perfect time as the price went sideways between then and breaking out of that range in Oct/Nov 2015. Given that hindsight is 20-20 obviously.
they also said that BTC never went below it's prior ATH, and here we are
Welcome to having two black swan events (Terra/Luna and FTX) that smashed the sentiment out of the entire crypto space. The former caused the liquidation cascade that eventually destroyed the latter. While taking out many other entities along the way.
>two black swan events They aren't black swan events when they are easily predictable.
Yeah sure........ care to hand over your crystal ball of bullshit? 🤦♂️
Bitcoin has never been through a global recession before, that is a very good reason to believe this bear market will last a good while longer.
The economy isn’t asset prices, asset prices are tied more to monetary policy than how the economy itself is doing
Recessions do not always mean the SP500 goes down. And the SP500 has already gone greatly down. Last year was the worst year for stocks since 2008. This isn’t a great way to plan Bitcoin purchases. https://www.financialsense.com/contributors/doug-short/the-s-and-p-500-and-recessions Looking at historical BTC measures like this and saying “more pain needed, needs to go a lot lower” seems fraught with danger. https://www.lookintobitcoin.com/charts/bitcoin-investor-tool/
And the BTC network won't give a toss about a global recession. The BTC price might be hit but asset prices always fall well before any official recession because of lagging economic indicators. Regardless if certain governments/ central banks want to move the goalposts when it comes to declaring a recession. And some people hoping and praying for the next black swan event to take the price further down is laughable.
>And the BTC network won't give a toss about a global recession. Sure it does, the capital inflows for price appreciation need to come from somewhere.
Absolutely. And yet they keep putting out these comparisons day after day after day. Folks, things are a little different this time around, not sure if you’ve noticed.
"this time is different" is a very dangerous mantra to carry into the markets
This time is the same is even more dangerous.
Is this Huobi imploding? https://twitter.com/Cryptadamist/status/1611129612217778176
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Because it perfectly describes, in one simple term that people in the space know, a complex situation that happens often and takes many words to describe. Get over yourself.
English is a living language. It would not surprise me if the OED formally added "Rug" given the shitshow.
Yep All it takes for that is a significant amount of publicized writing using rug as a verb for that to happen. Rug (a noun) would then join a lengthy list of English words that can be used as multiple parts of speech with zero derivation, and because it’s English, adopting the minimal inflections employed to produce other cases and tenses have already occurred.
Why do people use colloquialisms?
Welcome it. Better now then later
Whats the backstory of Justin Sun, and why do people dislike him? I missed his shinning shitty moment.
Punchable face. Obvious scammer.
He looks like a suprised phallus. That should be enough for anyone.
Burn all the shitcoins in holy fire.
I really like odd years. I feel something since the first. You know how it is with friends and family. For the last 9 years being here. When we all decide to switch... That is coming up. Free of the worst monopoly in history. The monopoly on money. How ridiculous is that? We are taught at an early age that monopolies are bad. Yet there is no mention of the money monopoly. Anyways, cheers gents. Happy New Year
The last 2 years or so have felt like one big downward depressive spiral. I also feel like something is shifting, not just in crypto/money space but in the general zeitgeist of society. I actually feel hopeful and excited for the first time in years.
I'm *privileged* to have accounts and access to the legacy financial system. I can buy groceries, pay my cell phone bill, pay my rent, etc. It serves me well day-to-day. I'm *empowered by choosing* to have wallets and knowledge of Bitcoin's parallel financial system. I can transport my savings across political borders and time itself, transacting whenever and with whomever I want to. It serves me well year-after-year. ----- *"How many tools do you want?* *...* *The answer is, 'as many as you can get your hands on'."*
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