Raoul Pal, a former Goldman Sachs executive, anticipates a significant rally in cryptocurrency and tech stocks, citing the inevitable rise in liquidity from central banks worldwide.
According to a report by The Daily Hodl, Real Vision Founder and CEO has indicated his belief that cryptocurrency and technology stocks are poised for a significant rally in the upcoming period. During a recent interactive Q&A session, the founder of Real Vision indicated that prevailing signs pointed towards an unavoidable surge in money printing by global central banks, a move that could considerably lift risk assets, primarily in the cryptocurrency and technology realms.
Pal highlighted his belief that increasing liquidity will primarily fuel the ascent of cryptocurrency and technology. His future-facing indicators have supported this belief, and so far, this has shaped the year’s narrative. This trend has puzzled many individuals, including himself, regarding the bond market. The lack of decrease in bond yields has been a confusing aspect for many, including Pal. He believes this is tied to the complex matter of the debt ceiling.
The debt ceiling issue, rife with substantial risks, is challenging to value accurately, according to Pal. A general bearish sentiment surrounds this issue, and Pal considers this a reasonable position, given the potential for unpredictable events. Any situation causing financial market stagnation, in Pal’s view, would inevitably lead to further stimulus.
Pal highlighted that signals associated with the central bank balance sheets of the G5 nations hinted towards an incoming tide of liquidity in the financial markets. Despite the bearish outlook of some analysts on risk assets due to economic uncertainties, Pal argues that their perspective is misdirected. He believes that despite a considerably slowing economy, central banks are still likely to increase the money supply.
Pal acknowledged that there might be stumbling blocks and hurdles along the way. However, he firmly believes that as the economy slows down, increased activity by central banks will continue to drive asset prices upwards.