Forbes Labels Bitcoin ‘Portfolio Insurance’

Portfolio Insurance? I thought Bitcoin was too ‘speculative’?

Key Points

Bond market conditions worsen, giving BTC power
Bonds market suffering from lack of liquidity
Fixed-income market moving towards Bitcoin
Famous high-Yield Bond trader turned BTC bull calls bonds ‘a ponzi’
Experts expect a ‘Bitcoin standard’ is coming, in the face of decrepit fiat monetary policy and management
Forbes says “every fixed-income investor needs to consider bitcoin as a portfolio insurance.”

The federal reserve is preparing their annual symposium, and many are not expecting everything rosy. Trading conditions in traditional investment vehicles found in many fixed income portfolios is worsening, according to Forbes. There is a lack of liquidity and widening bid-ask spreads in the bond market, and the Fed’s sentiment in Jackson Hole during their upcoming symposium could worsen already bad market conditions.

This is partly because the the Fed is currently buying $120 billion worth of bonds every month to prop up the economy. The Fed has pledged to continue buying these bonds until the economy “reached full employment and price stability goals were met.” If the spigot is turned off on this pump of fake liquidity into the bond market, there will be a massive correction in these markets, and it will ripple into most markets. However, according to Forbes, Bitcoin will be a hedge against all this madness.

Forbes cites higher prices, inventory shortages, labor scarcity among other things could even be exacerbated by the Fed’s “rampant money printing.” We have seen inflation on an unprecedented rise, sitting at nearly 5.4% according to government data. We have not seen inflation levels this high right before the mega-crash of 2008-2009.

In fact, the charts are eerily similar, and one day, soon, the musical chairs game will have to stop, just like in 2008, around the time Bitcoin was devised to give people a way out of the next inevitable crash. All this coupled with the recent ’50 year anniversary’ headlines of Nixon jettisoning the gold standard, led Forbes to proclaim that Bitcoin is and will be benefitting. “[Bitcoin] continues to entice investors who previously viewed gold as the de-facto inflation hedge and portfolio insurance.

Greg Foss, a career “high-yield bond trader turned bitcoin bull” is quoted by Forbes stating: “There’s a price for everything, fiat is a Ponzi, bonds are a fiat contract, therefore bonds are programmed to debase. It’s that simple.” He then went on the record saying that “every fixed-income investor needs to consider bitcoin as a portfolio insurance.” Keep in mind, by the second quarter of 2020, when bond buying (corporate debt buying) peaked due to covid, the total market made up over 12 trillion dollars…can you imagine if just 1% moved into BTC?

Forbes states Foss’s great reputation “gives his words added ballast.” They call him an expert in pricing and trading corporate credit. He is a self-described “laser-eyed bitcoin strategist espousing the popular “digital gold” narrative.” Foss’s thesis for Bitcoin being the new standard is due to central bank manipulation of “pen market pricing mechanisms, fiat currency, and debasement”. Foss is so bullish on Bitcoin, he called it “the best asymmetric trade I have seen in 32 years” based on an index he created called the Fulcrum Index.

Forbes pointed out how much crypto has grown in 2020 in the light of increasing government money printing and manipulation. Citing the rise of DeFi and citing billionaire investor Matthew Roszak, who predicts that the market cap of DeFi could grow 10x in the next 12 months. He says a “global chase for yield” will spur this increase. Forbes stated that the institutional interest in crypto looks primed to go even crazier, with recent announcements by Fidelity and Blackrock, mega-major firms who have tapped into the crypto market as of late.

Forbes ultimately predicts that the “battle” between central banks and DeFi, is “heating up” and “now would be a good time to stretch out your legs and reach for the popcorn.” One thing is clear: we know where the smart money is going, and that is towards crypto. Remember, not only are they finally calling Bitcoin ‘legit’, they are deeming it insurance against this broken fiat system.

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