Goldman Sachs Invites Investors to Talk About Bitcoin (BTC), Gold and Inflation – As Fed’s Balance Sheet Tops $7 Trillion

Bitcoin and cryptocurrency will be at the center of an upcoming customer conversation hosted by investment banking giant Goldman Sachs. Scheduled for Wednesday, May 27, the conference call, dubbed “the US economic outlook and the implications of current inflation, gold and bitcoin policies,” will focus on macroeconomic trends and how they affect financial markets.

On Thursday, the Federal Reserve announced a record breaking balance of $ 7.09 trillion for the week ending May 20, against $ 6.98 trillion the week before. The changing economic winds have painted a dramatic landscape with seemingly limitless money prints that have led institutional investors to increasingly go to gold while also investigating the rise of Bitcoin.

Federal Reserve President Jerome Powell has already warned that the upcoming second-quarter economic data will be the worst the country has ever seen. But in a recent 60-minute interview, Powell also spoke of the Fed’s broad powers to curb the brutal tide that has wiped out jobs and threatened equities during the pandemic.

According to Powell,

“We can do much more. We have been out of ammunition for a long time. No, there really is no limit to what we can do with these credit programs we have. “

Extreme central bank monetary policy has paved the way for Goldman Sachs to discuss quantitative easing, the risk of monetary inflation and how the global economy positions assets such as bitcoin and gold.

While gold has risen in value since the spread of the coronavirus – with analysts to predict that the asset could reach record highs by the end of the year – Grayscale, one of the leading digital currency asset managers, points to a changing view of Bitcoin.

BTC got a big boost from Paul Tudor Jones, a leading hedge fund manager, who revealed earlier this month that he has a solid crypto investment strategy, allocating 1-2% of his assets in Bitcoin.

Reports grayscale in a newsletter to investors,

Jones emphasized Bitcoin as a tool for hedging portfolios to counter the rapid expansion of the Fed’s balance sheet and unsustainable global debt levels. By sharing his belief in Bitcoin, Jones even explored several assets to help with inflation including gold, stocks, government bonds, commodities and currencies. In his note, Jones said succinctly, “If I’m forced to predict, my bet is that [on] Bitcoin. ”

With a top of $ 7 trillion, the Fed’s balance sheet doubled in the first quarter of 2020 after the central bank printed over $ 3 trillion through bailout packages and quantitative easing.

Source: The Federal Reserve

As for applying a more conservative approach to managing the current crisis, Powell says this is not the right time.

Now is the time to harness the great fiscal power of the United States to do what we can to support the economy and achieve it with the least possible damage to the long-term productive capacity of the economy. ”

The Goldman call is organized by Sharmin Mossavar-Rhami, the company’s Chief Investment Officer; Harvard Kennedy School of economics professor and former chairman of the Board of Economic Advisers, Jason Furman; and Goldman’s chief economist and head of global research, Jan Hatzius.

Featured image: Shutterstock / Allen.G