The pro-Trump economist Art Laffer, without knowing it, increases the Bitcoin Bull bias

The well-known economist Art Laffer co-authored a study of bitcoins in August 2015, in which he wrote that the cryptocurrency could usurp or occupy 1 percent of the market capitalization of gold at $ 2.5 billion. Four years later, the expert is once again presenting a strong bullish case for Bitcoin, although unknowingly.

Laffer told CNBC’s Squawk Box on Monday that he is not in favor of an independent Federal Reserve. The economist, who has officially advised two US presidents. UU On global financial issues, he said that the central bank of EE. UU It should be under government control to guarantee pro-public monetary policies.

    “I do not understand why the Fed is independent, to be honest,” Laffer said. “Fiscal policy is not independent. Military policy is not independent. Social policy is not. Why is monetary policy, this powerful tool for controlling the economy, not subject to democracy like any other instrument of government? “

Political pressure on the Fed is good for Bitcoin

The comments appeared in line with what the president of the United States, Donald Trump, has repeatedly said in the media. He has expressed his dissatisfaction with the decision of Federal Reserve Chairman Jerome Powell to raise interest rates four times last year and keep them stable in the current one.

“Just as we are doing it from the day after the significant Election when the Market soared, it could have been even better: an additional massive wealth would have been created and used very well,” Trump said last week. “Our most challenging problem is not our competitors; It’s the Federal Reserve!

Under intense political pressure, the Federal Reserve decided to cut interest rates in July. The central bank also paved the way to discuss further rate cuts by the end of 2019. The decision sent the US dollar index, along with treasury yields, to new annual lows. At the same time, safe haven assets such as gold and bitcoin increased.

“Bitcoin has become a hedge against irresponsible monetary and fiscal policy,” said Travis Kling, founder and CEO of Ikigai Asset Management. “We had the Fed make a complete reversal in a moderate way, then followed by all the other European Central Bank and Bank of Japan, and now we have this configuration in which central banks have become politicized in both the United States and the United States. The rest of the world is the new world in which we are living. “

Maintain sanctity

According to Norbert Michel, data analyst at the Heritage Foundation, the Federal Reserve has always been a pseudo-independent body. History is full of cases in which the presidents of the United States have enjoyed control over the monetary policies of the Central Bank. President Eisenhower, for example, ordered his Treasury secretary to pressure William Martin, president of the Fed between 1951 and 1970, to increase the money supply. When Martin refused, President Eisenhower told him to follow orders or resign. Martin followed the rules.

    “Whatever your opinion on the subject, let the Federal Reserve work because it currently assumes too much,” Michel wrote. “The idea that there is a scientific body established to guide monetary policy is very wrong.”

However, others believe that the Fed is and will remain an independent institution. Larry Kudlow, the White House’s chief economic adviser, said:

    “The Fed is independent. We are not trying to compromise that independence. Never will. I, by the way, started my entire career at the Fed a long time ago. “

In general, a combination of political and economic control creates a deficit of confidence among investors. As a skeptic of Bitcoin and the golden bull, Peter Schiff stated, even a dependent Fed will be as much a disaster as an independent one.

“Art Laffer is clearly looking for a job in the Trump administration. He thought the economy was big under Bush in 2006. He did not see the housing bubble or the impending financial crisis. “Trump’s economy is actually an even bigger bubble, with a much worse crisis looming,” Schiff wrote on Twitter.

Everything is good for bitcoin

Reference: newsbtc.com

Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.

You may also like...

Leave a Reply

Your email address will not be published. Required fields are marked *