Is A Recession Coming? How will a recession affect Crypto Prices.

Cryptos are supposed to be an asset class that can be used to hedge against inflation.

The Feds started to raise interest rates in March 2022 to fight inflation. Up to July 2023 they raised at an unprecedented rate and over that stretch of 17 months raised rates 11 times.

Did they overdo it and cause the economy to turn into a recession instead?

How will a recession affect Crypto prices? Will they go down together with the price of other asset classes like stocks and real property?

I believe that a recession will cause asset prices to go down. But the fall in Crypto may be less severe than for say, stocks. Being an asset class that is considered volatile, it cannot be ruled out that the initial drop in Crypto is more severe.

However I believe the drop will taper off and recover faster than stocks and real property. What do you think?

But in the first case, do you think that a recession will happen? Consensus forecasts from major banks, including Goldman Sachs, Morgan Stanley, UBS and Barclays, are for global growth to be constrained in 2024 by elevated interest rates, pricier oil and a weakened China, but with low odds for a recession. A year ago, many banks were forecasting a U.S. recession.

According to the major bankers, the odds of a recession are low and are lower than the odds a year ago. Do you believe the major banks?

Based on what businesses (Wall Street) are saying it does not seem to be so. Businesses seem to be more pessimistic. Generallty fund managers seem to agree with the Wall Street. So what will fund managers do with the funds they manage? Do you think that these institutional investors will go into Cryptos? Will they be "smarter" Than the man in the street (us generally) and be able to better time their investment into Cryptos? The timing of the approval of spot Crypto ETF's will have an effect on when the institutional investors go in. Currently they may be prevented from doing so by regulations. The approval by SEC of spot ETF may be required before they can do so. This is why there is so much excitement over the possibility of the SEC approvals