The US stock markets reminded us that in the world of financial investments, there aren’t many ‘safe’ options, probably none. Just like the cryptos, stock and commodity investors have experienced one of the toughest months on Wall St. since 2008. Dow Jones, FTSE Nasdaq and even industry leaders like Apple have experienced considerable falls across the markets. This has been the worst week since Donald Trump’s inauguration. It comes after one of the best years in history for shares and stock and even more surprisingly, just a week after the Dow hit a record high.
Just putting it into perspective, the 500 wealthiest people in the world, combined lost over $68.5 Billion, that’s a whole lot of money, especially for seasoned, veteran investors like Warren Buffet, who lost a little over $3.3 Billion in a week, the same Warren Buffet who spoke publically against the risks involved in cryptocurrencies investments. Although he might still be right about some, he failed to mention that wherever money is involved, there are risks.
The irony of the situation is that this specific freefall in prices is a result of healthy financial growth in the US markets. Odd, but there is a reason for it. Exceeding expectations for financial growth, higher wages, after years of stagnation and the creation many more American jobs led to a genuine public fear of over-priced inflation rates. The SEC knows that the economy is in good shape and can afford stretching the thin line. To further fuel the chaos, we see analysts categorize this correction as a “melt-up”, where shares continue to rise despite looking overpriced by traditional yardsticks, one last ‘hurrah’ before a downward correction or crash. Sounds familiar? Too familiar.
The blockchain is a disruptor and a game changer. The financial markets as we know them will have to change in order to adapt to the new reality, but money, regardless of the form that it’s in, Fiat, Crypto or even the good old barter has a value that WE give it, without US, it is just a piece of paper or a line of code.