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Modern Economic Nonsense — Recession is coming

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The global economy is a house of cards. The 2008 financial crisis was just the first sign that things were not well. Since then, central banks have been artificially stimulating the global economy through quantitative easing and record-low interest rates to prevent another recession. But these measures cannot go on forever. When interest rates reach their lowest possible point, there’s no further that they can go down. With most central banks now ending their QE programs, we are approaching the end of an unprecedented period of monetary stimulus that has kept the world afloat for nearly a decade after the last recession. What comes next will be very different from what we’ve experienced so far. In a recent interview with Dutch newspaper De Volkskrant, billionaire investor Warren Buffett warned that “the next recession will come sooner than people expect” and will be more severe than in 2008 because monetary policy has backed up against its limits. Markets remain overpriced, he said, and artificial stimulus won’t work for much longer. “We are sitting on a keg of dynamite that will explode sooner or later,” he said. This time, the recession is not because we are running into economical trouble, it is we are having too much wealth!

Why is the next recession coming?

The global economy is currently growing at the slowest rate in the last five years. A marked slowdown in the Chinese economy, heightened trade tensions, and uncertainty surrounding Brexit have dented global growth. This can be seen in weaker trade growth, declining corporate earnings, and a slowdown in global investment. The US economy, the world’s largest, is also facing headwinds. The recent stock market turmoil in China and the US-China trade war have only added to the picture. It is important to remember that the Chinese market was already grappling with a slowdown in economic growth and a real estate slowdown, both of which had a negative impact on the stock market. The US market, meanwhile, has been in the grips of a bear market for months, with the S&P 500 hovering at around the same level as it was back in October 2017. Worst, the US printed much money to cover the Pandemic downturn and to carry more debts that cannot be erased easily without possible economical contractions.

Record-high household debt and overvalued equity markets

Household debt in the US has surged to record highs. According to the Federal Reserve’s data, the ratio between household debt and income has increased to a record high of 6.8. This is far higher than the average over the past three decades of 5.5. Household debt has been rising in the wake of the financial crisis, as the Federal Reserve kept interest rates low. Meanwhile, household income has been falling since the 2008 financial crisis, falling from $51,971 in 2007 to $44,749 in 2017, according to the Bureau of Labor Statistics. Amid this backdrop, equity valuations are at their highest ever. The S&P 500’s price-to-earnings ratio (PE) is currently at 22.6, well above its long-term average of 16.5. This means that the stock market is trading at a premium, as investors are willing to pay more for each dollar of earnings. However, when an asset is trading at a premium, it is more likely to face a correction or a slump. 

Central banks have run out of options

Central banks have maintained the fragile global economy on life support through years of ultra-loose monetary policy. They slashed interest rates to record lows and pumped trillions of dollars into equities, real estate, and other assets through asset purchase programs like quantitative easing (QE). But now, after nearly a decade of quantitative easing, central banks are cutting back on their support for the economy. The Federal Reserve has already ended its QE program. The European Central Bank (ECB) and the Bank of Japan (BoJ) are winding down their stimulus programs. The BoJ has ended its QE program, and the ECB has hinted at an end to its asset purchase program. Other central banks are expected to follow suit in the next few years. Infinity QE is not a solution but a problem to create down the road. The Fed needs to control the consequence of the QE – inflation and avoid the hike in the unemployment rate – the recession is unlikely successful. While huge debts drag the Fed’s foot to proceed more aggressive Quantitative Tightening (QT) gives the Fed no choices but to put everyone into recession and possible QE again to pump up the economy. 

Protection against recession: don’t rely too heavily on equities or bonds

While equities and bonds have generally performed well in the face of global financial crises, they are risky assets that are subject to extreme volatility and can fall significantly in a recession. You can reduce your exposure to equities by investing in equities in different regions and industries so that you are not too heavily concentrated in one sector. This will reduce the damage to your portfolio in the event that one sector suffers a significant decline in value. You can also diversify your equity holdings by choosing low-cost Exchange-traded funds (ETFs) that track different indices, like the S&B 500, MSCI EAFE, FTSE 100, and others. Bonds provide a steady and reliable income, but you must choose your bonds carefully; ignore the allure of high-yield corporate bonds and invest in government bonds instead. If you are looking for an investment that offers higher yields, then consider real estate investment trusts (REITs) or stocks in high-yield companies, which have a higher risk profile. Of course, there are always cases that you cannot predict.

Recession-proof portfolio: invest in cash, gold, and high-quality businesses

A recession-proof portfolio should be flexible and dynamic, allowing you to shift between different asset classes depending on market conditions. It must be able to deliver returns regardless of economic conditions and must not be heavily dependent on interest rates, equities, or bonds. The following are some of the best ways to build a recession-proof portfolio: Invest in cash: If you want to invest in cash, you can buy short-term Treasury bills, money market funds, or invest in a high-yield online savings account. Invest in gold: While gold is not a useful asset in all economic conditions, it is an ideal asset to own when the economy is heading towards a recession. Invest in high-quality businesses: You can choose to buy the shares of a company that you believe will perform well even in a recession. However, you must select your investments carefully, as stocks tend to lose value in a recession.

Recession-proof portfolio: invest in cryptocurrency

Another way to weather recession is to dive into cryptocurrency. Of course, you should bear in mind that crypto is a lotto ticket to the future. A gamble to prevent the worst-case scenario. You should not yolo your hard-earned money but put a small fraction of your money into buying and forget about it. Also, there is no perfect recession-proof portfolio but to trade off the short-term risk for a long-term gain under your bear risk and mental health. The key here is not to beat up the recession but to explore a potential opportunity. 

And do not waste your time following the trend:

Conclusion

A recession is a natural part of the business cycle and inevitable in the life of any economy. It is important to remember that recessions are not unusual and they are necessary for maintaining a healthy economy. A recession can affect everyone, no matter what their profession or industry. While there is no way to predict exactly when a recession will occur, it is important to prepare for one by setting aside savings and building up an emergency fund. With the right strategies and a little luck, you can weather the storm and come out stronger on the other side. Now that you know what a recession is and how to protect yourself from one, you can keep calm and be prepared for anything.

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Crypto Research

Central bank is the mother of the crypto afterall

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As the old saying goes, “The hidden power of the government is to support or contravene the will of the people.” The central bank is no exception. In fact, it’s so powerful that it can even contravene the will of the people. That’s right: The Federal Reserve Bank President Bernanke has been able to control what money the central bank prints and how much interest it levies on those funds. This allows for a variety of strategies to combat inflation and other financial crises. However, all this power rests on a thin sword—the federal government. Because with so much power comes responsibility. What action will you take when your authority over money is challenged? When you see yourself VERSUS opponent as the central bank? Here’s why you should fight back.

What is the Federal Reserve Bank?

Friedan’s famous definition of power is “the ability to do or affect things which the rest of the world does or does not do.” It is the ability to controlling and influencing the financial and economic outcomes of others. In short, the central bank is the entity that has the power to control the flow of money and make or break a financial crisis. In that sense, the federal government is also the most powerful entity in all of reality: It’s the one who controls and decides what happens in the world around it.

The Federal Reserve Banks

The Federal Reserve Banks are the administrative agencies within the U.S. Department of the Treasury that create and manage the collective monetary asset of the United States. These include the Federal Reserve Banks of New York City, San Francisco, andChicago, as well as the Oklahoma City and Trenton-based state-run banks.

How the Fed Works

The federal government owns and regulates the creditworthy banks and financial institutions that compose the Federal Reserve System. Although the government owns a majority share of the banks that compose the system, each Federal Reserve Bank is independent. The federal government provides funding for each bank, but the banks are ultimately responsible for funding the federal debt. To achieve that, the banks have a series of mechanisms they use to fund the federal debt. The qualifying banks for the federal credit program include U.S. Mainland banks like Bank of America, Capital One, Citi, Wells Fargo, and Wells Fargo Bank. Additionally, the federal government provides funding for certain international banks that qualify because of their close relationship with the United States. These include international investment banks such as Morgan Stanley, Goldman Sachs, and Citigroup, as well as U.S.-based financial services companies like American Express, Citi, and Wells Fargo.

Why You Should Care

So, the Fed has the power to control and determine what happens in the world around it. The question is, how should you use that power? The answer is both simple and profound: If you use your power well, then everything will be fine. If you use your power poorly, then everything will be dark. In fact, it’s likely that the dark times ahead will be some of the most tense and challenging times in human history. That’s why it’s important to have the foresight and foresightfulness to prepare for them. In the words of the apostle Paul: “In the midst of temptation, occur the wise and prudent steps, which God permits us to take.”

How to Invade the Fed’s Territory

Banks are not the only entities that bank on the Federal Reserve System’s success. The global financial services industry is ready to Leverage if required to increase its exposure to the U.S. economy. That industry is particularly keen on increasing its exposure to creditworthy banks and financial institutions located in emerging markets. That’s why the Financial Services Regulatory Authority, which oversees the international banking industry, recently issued its “Go Big or Go Home” monetary policy.

The Future of Money and Banking

The financial services industry is not the only one ready to Leverage if the central bank does not step in. In fact, the entire financial services industry could soon become a target for financial leverage. That’s because the Federal Reserve has been using quantitative easing to help reduce the levels of high-interest debt, which accounts for one-quarter of all total credit ratings. How that is accomplished, the central bank doesn’t explain. But it can be done—and done effectively—when the need for more money is great and the need for more creditworthy banks and financial institutions is great.

Bottom Line

The financial services industry is ready to Leverage if the central bank does not step in. That industry is also ready to Go Big or Go Home if the central bank doesn’t step in. And that’s just in the developed world. The entire financial services industry could soon be a target for financial leverage. That’s because the Federal Reserve has been using quantitative easing to help reduce the levels of high-interest debt, which accounts for one-quarter of all total credit ratings. That’s why the central bank has been using quantitative easing to help reduce the levels of high-interest debt, which accounts for one-quarter of all total credit ratings. The financial services industry could soon become a target for financial leverage. And crypto may not able to escape.

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Crypto Research

You need a Crypto debt management system

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As is the case with most big-ticket purchases, you need a system in place to manage your debt. Fortunately, there are a variety of ways to get started developing one. From building a personal budget to planning ahead for retirement, it’s possible to develop a sustainable and healthy financial model with the help of a debt management program. Regardless of your individual needs, it’s important to consider how your current relationship with money will be impacted by implementing a strategy that limits your debt. Having an accurate picture of your long-term financial goals is crucial when developing a strategy. Get started today by reading through these steps.

Get to know your combined debts

One of the most important steps in developing a debt management system is getting to know your combined debts. This includes everything from your home equity loan to your mortgage and other types of loans. This will allow you to get a clear picture of how much extra cash you’re willing to accept from your creditors in exchange for making smaller payments. It’s also a good idea to discuss your net worth and assets as part of this process. Having a clear picture of what you’re willing to pay in return for the right to make larger payments is crucial to building a sustainable financial model.

Define how much you’re willing to accept from your creditors

One of the most important steps in developing a debt management system is getting to know your combined debts. This includes everything from your home equity loan to your mortgage and other types of loans. This will allow you to get a clear picture of how much extra cash you’re willing to accept from your creditors in exchange for making smaller payments. It’s also a good idea to discuss your net worth and assets as part of this process. Having a clear picture of what you’re willing to pay in return for the right to make larger payments is crucial to building a sustainable financial model.

Plan for retirement, and then use that money for now

One of the most important steps in developing a debt management system is getting to know your combined debts. This includes everything from your home equity loan to your mortgage and other types of loans. This will allow you to get a clear picture of how much extra cash you’re willing to accept from your creditors in exchange for making smaller payments. It’s also a good idea to discuss your net worth and assets as part of this process. Having a clear picture of what you’re willing to pay in return for the right to make larger payments is crucial to building a sustainable financial model.

Develop a budget

One of the most important steps in developing a debt management system is getting to know your combined debts. This includes everything from your home equity loan to your mortgage and other types of loans. This will allow you to get a clear picture of how much extra cash you’re willing to accept from your creditors in exchange for making smaller payments. It’s also a good idea to discuss your net worth and assets as part of this process. Having a clear picture of what you’re willing to pay in return for the right to make larger payments is crucial to building a sustainable financial model.

Use debt management tools

One of the most important steps in developing a debt management system is getting to know your combined debts. This includes everything from your home equity loan to your mortgage and other types of loans. This will allow you to get a clear picture of how much extra cash you’re willing to accept from your creditors in exchange for making smaller payments. It’s also a good idea to discuss your net worth and assets as part of this process. Having a clear picture of what you’re willing to pay in return for the right to make larger payments is crucial to building a sustainable financial model.

Conclusion

Developing a debt management system is an important and costly business. The best way to start is with a realistic budget. You can rest a little bit easier knowing that you have a plan for how to use the money you have.

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Crypto Research

Is this the end of the crypto

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Blockchain is here to stay. It’s just a matter of when, and what type of adoption will happen as a result. However, for the industry at large, it has probably been one of the most significant digital transformation events in recent memory. This year witnessed the launch of the first major cryptocurrency market cap, with more than $1 trillion being raised in total from investors over the course of 2021. So where do we stand? Do we need another massive digital transformation event or have we already passed it by? Let’s see…

What is the future of blockchain?

Blockchain is a decentralized, public, and distributed ledger that provides record-keeping and transparency for all online transactions. It’s also called the virtual credit card that people use to stay on top of all their finances. It’s an advanced technology that can ensure transparency, security, and accountability for allocating public resources. It’s based on smart contracts and digital currencies like Bitcoin, Ethereum, and others. Blockchain technology has been used in digital payment systems for years and can be used to securely store data across geographic boundaries and in a variety of digital forms. CBDC is a blockchain technology implemented by the central bank is one of examples.

New products and services will be released

The current digital transformation landscape is full of exciting new products and services that will soon be released. It can be hard to choose just one. There are so many great choices right now and it’s hard to know where to start. But some of products experienced recent shake up and less likely to progress faster than other products.

Digital payment is the king

If you’ve been following along with our progress at this point, you’ll have a pretty good idea of why we love payments so much. In fact, we are still working on that final piece to our connected payment system — how many payments do we need to make before our payments can be counted as secure? Let’s take a look at the numbers. For businesses looking to scale their operations and reach an untapped market segment, digital payment is the king — especially when used efficiently. To achieve maximum impact, enterprises need to integrate cryptocurrency into their payment infrastructure as quickly and smoothly as possible. A properly functioning digital payment strategy works both ways: it protects users from fraud and it makes transactions more efficient by making them automated and frictionless. Here is what you need to know about digital payments.

What is digital payments?

Digital payments are made using a digital currency, typically Bitcoin, but also other digital assets such as debit and credit cards. A digital payment typically provides a set amount of money to the paymentor, with the payment receiving party then sending a digital token that is then stored in the customer’s account. The payment is charged against the account balance, which is then collected and sent to the payee. The payee could be the business, whether a company or individual, that made the payment, as well as the server or service that sent the payment.

How do digital payments work?

There are a number of key things that make digital payments successful, but the big one is communication. Digital payments rely on a user communicating with the service provider to complete the transaction. If a user experiences a problem logging into their account, it would be inadequate to just leave a message and hope that the service provider gets back to them. As there is no way to selectively ignore messages on digital payment systems, it’s important to have communication mechanisms in place to get the transaction completed. To send a digital payment, the user sends a certain amount of cryptocurrency to the payment service provider. The payment service provider then sends the requested amount to the user’s address. The user then receives the completed transaction in the form of digital tokens. After the payment, the user can use the tokens to access their account with the payment service provider.

Why are digital payments so popular now?

The popularity of digital payments has its roots in the financial crisis of 2007-08, which led to major changes in how payments were made and handled. Pay-per-use (PPU) payment systems were introduced as a new way to settle payments. PPUs use a mathematical formula to determine the amount of payment needed to complete a transaction. This formula is then used to determine the security of the payment as each payment will contain private information such as financial accounts, payment history, and payment triggers. The payment system also contains a database of all the payments made with that payment type. This history is used in the same way that credit cards use information about past purchases to verify the account holder.

Best practices for digital payments

When handling digital payments, consider these best practices. Communicate with service provider upfront. Before sending a payment, remember to communicate with the service provider to exchange information, confirm the payment type, and specify the amount. Be specific about what information you want to share. If possible, make your communication as short as possible. Ask for proof of the transaction. If the payment system does not have access to your digital wallet, ask for a proof of the transaction. Explain the procedure. Discuss the procedure for all parties in the transaction. Take the time to understand the procedure. Ask the service provider if they have any questions. Embraced a new communication method. Before communicating with a service provider, some businesses have begun using a new method of communication — email. In addition to communication using email, some businesses are using social media, post-it boards, and other digital communication tools. This could be a significant shift in how payments are made, and in how payments are processed, but it shouldn’t be taken to heart. Don’t assume everyone in your industry will adopt this new way of communicating. Made a clear and distinct outline of the transaction. Before communicating with a service provider, outline the transaction in multiple levels. This includes the moment the transaction is completed, the complete transaction, and any applicable extensions. It’s also a good idea to include a rough price range so the customer can be equipped for any discounts or other discounts not available in the higher price ranges.

Final words

Digital payments are becoming more widespread as more people are embracing the benefits of digital payments. While there is some room for improvement in terms of operational details, the end goal is to make digital payments as frictionless as possible. This means more than just creating digital payments; it also means making sure that the process is automated and frictionless. For more information on how to implement digital payments in your business, contact a trading platform developer today. They can help you create a toll-free number that you can call if you have any questions or concerns.

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