Why Crypto & Stocks Crash? What to Expect Next?

In the latest podcast interview, Opening Bell Daily co-founder Phil Rosen and Professional Capital Management CEO Anthony Pompliano discuss the factors behind the decline in stocks and Bitcoin. They also discuss Trump and Kamala economic policies, the proposed capital gains tax hike, and what asset prices could look like with potential interest rate cuts.

He notes that Bitcoin is hovering around $56k, down 12% over the past six months, with a 30% drop in daily active addresses. Despite this downturn, Pompliano points out that Bitcoin holders are long-term players, treating it as a financial asset rather than a simple consumer product.

Why Are Bitcoin and Stocks Falling? Let’s Dive In!

Are there catalysts on the way?

Rosen also discusses potential catalysts that could impact Bitcoin’s price over the next six to 12 months. While there’s no clear cause for a massive price surge, he suggests that events like interest rate cuts or even large-scale purchases by sovereign wealth funds could spark bullish momentum. However, he tempers expectations, saying that a full-blown bull market may not be imminent and that volatility is expected to decline over time, making Bitcoin less risky than the S&P 500.

Stocks: September dip or steady rise?

September has historically been the worst month for stocks, with the S&P 500 losing an average of 7% over the past 75 years. Despite this, investors remain optimistic, with record levels of investment in stocks and the S&P 500 hitting nearly 40 record highs this year.

Rosen emphasizes two important points: First, investing in stocks has proven successful for many over the long term because consistent investing over the long term can lead to wealth accumulation.

Second, while there are concerns about overexposure and a potential stock market crash, the real focus should be on long-term investment strategies rather than short-term fluctuations.

Dollar Devaluation: The Key to Long-Term Growth?

A key part of Rosen’s argument revolves around the inevitable devaluation of the US dollar. As the dollar loses value, financial assets such as real estate and stocks will naturally rise in price. This phenomenon explains why real estate investors consistently make money even when the intrinsic value of the property has not necessarily increased. The loss of purchasing power in the dollar means that future buyers must pay more for the same asset.

A bull market with a bear twist

Continuing with the advice to stay long in the market, Rosen sees the bull market rolling along, but doesn’t expect sky-high 100% or 200% gains. Instead, steady growth is the game, fueled by the devaluation of the US dollar. While some fear a crash, Rosen believes the key is long-term, consistent investing, with the S&P 500 proving to be a wealth-building powerhouse for those who can ride out the bumps.

Economic crisis? Investment confusion? What is your bear strategy? Tell us.