The head tech guru on Wall Street, Cathie Woodhas entered a spiral of lobby to the main US institutions in order to defend the interests of its star fund and consequently provoke a comeback of the technology sector, its main stock market. Even if it’s artificial.
His latest rants have been that the bitcoin will be exchanged for a million dollars in 2030 or what, If the American Federal Reserve (Fed) does not lower interest rates again, it will end up generating an economic crisis as serious as that of 1929.
In an interview with Bloombergthe CEO and Investment Director of ARK Invest has asserted that, “sometimes, you need the test that supposes a bubble and go through a crisis to see who the survivors are” and, in this sense, has defended that “bitcoin returns to smell like a rose.”
“Maybe the institutions will step back and say they really get it. They want to do their homework and see what’s going on in this market. Therefore, I will be more comfortable moving towards bitcoin as a first phase in which they will have to understand it better ”, he added.
However, bitcoin is now trading in the $16,416 for each of its cryptocurrencies, which represents a loss of value for the queen cryptocurrency of 65.6% so far this year and 74.5% since its all-time high, when on November 12, 2021 it touched 64,400 Dollars.
[Los gurús de las ‘criptos’ alertan de una cascada de quiebras en el sector tras la caída de FTX]
Thus, if his risky -and perhaps unrealistic- prognosis comes true, in eight years bitcoin could revalue 5,991%, up to that iconic million dollars.
Wood has a lot at stake in the renaissance of the technology sector on the stock market. Even though its popular ARK Innovation ETF lived the best day in its history a couple of weeks ago when the latest inflation data was released in the United States, the fund It continues to sink 59.5% this year. A loss that could be irrecoverable unless tech stocks soar again.
Fight against the Fed
On the other hand, he advocates that the Fed Jerome Powell pivot on its current strategy of monetary tightening and that return to its previous downward path of rates. “If the Fed doesn’t pivot, the scenario will be more like 1929. The Fed raised rates in 1929 to stifle financial speculation and then, in 1930, Congress passed the Smoot-Hawley Act, putting tariffs higher than 50%. in more than 20,000 goods and services pushing the world economy into the Great Depression”, he warned.
And he has also criticized on his Twitter account that, “unfortunately, today there are some echoes of the same thing, the Fed is ignoring the deflationary signals.”
Unfortunately, today has some echoes of the same. The Fed is ignoring deflationary signals, and the Chips Act could harm trade perhaps more than we understand. Much like the reaction to Smoot-Harley, economists have paid little attention to the potential impact of the Chips Act.
—Cathie Wood (@CathieDWood) November 12, 2022
Since the US central bank began to forcefully raise the official price of money, technology companies have done nothing but go down. The collapse of the Nasdaq 100 is 28.5% So far this year, and companies in the technology sector have destroyed more than 120,000 jobs in 2022 alone.