- Nassim Nicholas Taleb’s Analysis on Japanese Market Collapse and Bitcoin Crash Explained
- Explains Japanese market collapse’s role in Bitcoin crash.
- Author of “Black Swan” and “Antifragile” books.
Recently in an interview the author of “The Black Swan” Nassim Taleb give his view on efficacy of the latest strategy used by the Bank of Japan which led to the ‘office cleaning’ of the stock market in Japan and then a multiple in the US stock market and Bitcoin Crash Explained.
Years of near-zero interest rates
Taleb said that the BOJ has taken the interest rate to zero percent for almost 33 years and has been QE’in the tools into the Japanese economy for last 23 years. He said that those strategies “entail a cost which you have to pay at some point in time. ” Three have noted that Japan’s QE program has worked unlike the volatile approach of the US Federal Reserve which nonetheless resulted to recent high inflation nonetheless.
Raising interest rates
But as the BOJ debates a further, such similar experts from all over the world have termed it as unproper timing. Mari Iwashita, the chief economist of Daiwa Securities Co said that this would have been wiser on the part of Japanese to wait for the trend on the US economy as to whether heading for a recession or whether it will be a soft landing for the US economy before raising interest rates again.
This is so because the Japanese currency has crashed through the floor and this has affected the price of Bitcoin.
When Japanese equity market crashed, US markets also had the same experience; this forced Its Bitcoin down from approximately $61,000 to about $49,750 within two days. Other digital currencies also followed the dips in Bitcoin and the similar trend as well. In relation to this event, host of the Keiser Report and Bitcoin lover Max Keiser said it looks like it is not as bad as it seems in terms of damage. If he were the Fed he would desist here to deflate 40% or more perhaps off the global markets.
The state of the bitcoin price
Bitcoin has only been somewhat able to recover its previous position after the fall that was triggered by the Japanese and later the US markets. It currently stands at around $56,308, but it almost seems like it cannot as it races in the markets all over the world due to the state of the economy. The macroeconomic environment that both Taleb and Keiser provide once more assists in explaining how and why Bitcoin is still experiencing such price movement in the present.
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