Financial Advisor Predicts Boom for Bitcoin if Trump Cuts Interest Rates

Libra Coin News
Thu, 09/12/2019 - 11:13
Darryn Pollock
As US President Donald Trump calls for more interest rate cuts Dan Tapiero, of DTAP Capital, predicts a boom for Bitcoin.
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President of the USA, Donald Trump, recently took to Twitter demanding another cut in interest rates; in fact, he called for interest rates to drop to zero or below. For Dan Tapiero, of DTAP Capital, the "debasement of the dollar," as he calls it, would potentially be a boom Bitcoin and other assets, such as gold. 

The reason for Trump calling on the reserve to make such a move is to drive economic activity hopefully. However, it will also lead to people earning no interest for storing money in the safety of banks, or even worse, have to pay to store their cash. 

If this is the case, there will be little benefit or enticement to store wealth in a bank, and people looking to gain benefits from their savings will potentially look elsewhere, and Bitcoin is becoming a popular choice in today's modernizing and uncertain world. 

The problem with interest rates

When governments and banks start playing around with the interest rates, there is usually an indication of economic concern. Slowing growth is generally stimulated by a central bank interest rate cut as high-interest rates encourage saving and low ones are known to encourage spending and borrowing, which drives new economic growth.

The first time negative interest rates were seen was in the post-2008 financial crisis, in Europe. The European Central Bank dropped the rates below zero because of low inflation and a massive debt crisis.

Bitcoin becomes more enticing.

Although low-interest rates are supposed to encourage spending and negate saving, there will be a vast swath of the population that will want to maintain their savings and will be looking elsewhere to see growth in their money rather than a slow trickle out the banks of negative interest rate come about. 

This is the reason Tapiero is eyeing both Bitcoin, and a traditional safe-haven asset, gold, as the ones that would benefit the most if Trump gets his wish.

First President to call for negative interest rates. Medium term this is direct call for a debasement of the US dollar in an attempt to create excess growth into 2020 election. Federal Reserve "boneheads." Gold and Btc should benefit as alternative stores of value," Tapiero tweeted.

About the author

Darryn Pollock is an award winning  journalist from Durban, South Africa. He picked up Vodacom’s Regional Sports Journalist Award in 2017 while expanding his Blockchain and cryptocurrency reach.  He is a contributor to Forbes, Cointelegraph, Binary District, CCN, U.Today and of course, CryptoComes. Darryn’s belief is that Blockchain technology will be the driving force of the next technological wave and it is the obligation of journalists and writers to tell its emerging story with integrity and pride.

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