A week in Dacxi
Every day, I will be giving a ‘Market Update’ to keep you informed with what’s going on in the general crypto and stocks sphere. Watch the Market Updates here.
We are respectful that this is a time of deep financial concern for many people. We also want to be clear that Dacxi has solutions to people’s economic problems, and it is essential to share this reality.
For all the fluctuations in the crypto-asset market, it should benefit significantly from these turbulent times due to the ‘digital gold’ status of Bitcoin and the interest of the wider financial markets. Dacxi’s affiliate programme should also attract many of those who are looking for new financial opportunities. We seem to have perfect timing, and this is currently being reflected in Dacxi’s performance in March.
They say that ‘history repeats itself’, so what can we learn from the last three financial collapses; the Asia Crisis 1997, Dot Com Bust 2000–1 and GFC 2008:
1. Market collapses after excessive irrational gains. Markets always collapse following a period of excessive asset price growth that does not reflect the underlying economy:
- Asian markets boomed in the 1990s, as ‘hot’ money poured into Asia chasing the Asian Boom.
- Tech/Comms stocks boomed in the late 1990s as investors chased Get Rich Quick dreams in the Dot Com boom of Internet hype.
- Then, after the Dot Com bust, driven by the Black Swan event of 9/11, governments stupidly allowed banks to ‘print’ $15trillion to grow the economy, which just inflated assets prices to crazy levels producing the Global Financial Collapse of 2008.
- Then, to grow economies after the GFC collapse, governments themselves printed trillions of dollars in ‘Quantitive Easing.’ Even more stupidly, they didn’t stop printing money even after stock markets grew by 100% to 2015. They also started QE again recently, causing stock market prices to double back as companies used cheap money to pay big dividends and buyback stock to push prices to execute executive bonuses. US stocks were up 31% last year, even though growth was just 2.3%. The market was ready for a significant collapse!
- The lesson: this market correction was guaranteed to happen!
2. Black Swan. The coronavirus crisis is simply a ‘Black Swan’ event that was the catalyst to this crash. The impact of the virus will drive a very harsh recession as well. Market collapses follow a standard formula…
- Firstly, [CRASH] something happens to trigger the collapse, and all markets are sold off aggressively.
- Then, [LIQUIDITY EVENT] the most liquid assets (gold, crypto) get sold off even more, as companies and individuals scramble to find quick cash to cover margin calls on their positions.
- Then, [MARKET SUPPORT] governments take action, making promises to stabilise the fall. This creates the BOUNCE.
- Then, [SECOND WAVE] traders estimate what will happen in the markets in the future. They go up or down.
3. Different assets respond differently. Today?
- Gold goes up if they think money will go into ‘haven.’ It’s bounced back to only 10% of highs.
- Some commodities will go up or down based on predictions. Oil looks very sick based on a weak Northern summer. Is this the end of the Oil Era?
- Property looks sick, as a recession, unemployment, and unaffordability should push prices down.
- Stock markets should recover as they are printing too much money. Eventually, the recession/depression will cause the markets to drop and not improve for a few years.
Crypto should have a very positive future, because:
- The other investment asset sectors look too sick; therefore, crypto looks positive comparatively for investors.
- Only a small percentage of institutional money diverted into crypto will have a hyperbolic impact on prices. Higher prices will attract more money.
- As Bitcoin is so dominant (63% of total market cap) and people talk of it as a ‘Digital Gold,’ ie, safe haven, it could/should attract big money.
- A boom always follows the Bitcoin halving in May in prices.
For these reasons and many others, Dacxi is confident about crypto and the company’s future. This change can only be great for Dacxi and, therefore, you. Take advantage of your good fortune. Share the news.