The devastating impact of coronavirus is glaringly obvious not only the social fabric but also on the global economic system. The highly contagious disease has brought the world to its knees and governments and federal institutions are leaving no stone unturned to support their economies to avoid global meltdown kind of a situation that the world witnessed in 2008.
US Federal Reserve Announcement
Central banks of the various countries are coming forward with economic packages and one of the most important announcements has come from the US Federal Reserve, which is now gearing to swamp the market with liquidity. While this declaration might have come as a reprieve for many disgruntled companies and employees, the stock market has a different take on the news.
Given the fact that more printing of the money will ultimately devalue its position in the market, the dynamics of the stock market have changed on the backdrop of the Fed’s announcement. More specifically, the gold and cryptocurrency have shown positive trends with their value climbing the ladder just after the announcement of having “Infinite Liquidity” has been made. The resurgence in the prices of the gold has been led by the speculation that the situation today has become, more or less, akin to the 2008 Global financial crisis and the infusion of fresh liquidity into the market will ultimately have a positive impact on the prices of gold as well as Bitcoin.
Word has it that the US Federal Reserve is going to start a massive buyback process, which will turn out to be a positive for the owners of the gold and crypto holders. During this buyback process, the Federal Reserve is estimated to be spending around $2.5 trillion/month, which is a massive exercise by any standards of comparison.
What has also stimulated Bitcoin holders is the fact that this particular announcement of increasing the liquid into the market has just come before the event of Bitcoin halving that is expected to…