Expert Forecasts US Pre-Election Debt Crisis akin to ‘Bank of England’ Scenario
Macro Strategist Otavio Costa from Crescat Capital, a multidisciplinary asset management firm, has raised concerns about the declining liquidity index of U.S. government securities and its potential impact on U.S. debt.
Costa warns of a looming ‘Bank of England’ moment for the U.S. economy before the elections, anticipating a significant rise in yields. He points out that the U.S. faces one of the largest interest rate differentials compared to other developed economies, exacerbating the fiscal imbalance amidst an inflationary environment and reduced foreign central bank demand for Treasury issuances.
Costa suggests that traditional investment portfolios may shift allocation to safe-haven assets like gold to prepare for impending imbalances. Other analysts and experts, including Robert Kiyosaki and Mike Novogratz, have also issued warnings about the growing U.S. debt and advocated for alternative investments like gold, silver, and bitcoin to mitigate risks.
Clever Robot News Desk 22nd June 2024
