One of the investors who made a profit by calling during the 2008 subprime mortgage bust says that cryptocurrencies are now one of three major themes driving today's narrative. He is not yet a fan of cryptocurrencies.
In a new interview with Bloomberg TV, Neuberger Berman's Steve Eisman talks about artificial intelligence (AI), infrastructure, and cryptocurrencies:
While he understands the first two themes, Eisman says he doesn't believe in cryptocurrencies.
The investor said there is a theory that digital assets are a hedge against inflation and fiat currencies, but this is contradicted by their correlation to risk assets and the Nasdaq.
“Ask the people who own cryptocurrencies. Why do they own it? They all say the same thing. They say…it’s the end of fiat currencies. The cat and the dog are going to lie together someday, you're going to be in a cave, but at least you're going to have some kind of digital gold, that's the theory.
Well, let's just take their word for it. If that were the theory, then on days when everyone is worried about inflation, everyone is worried about budget deficits, the Nasdaq is down 300 points, and interest rates are rising, cryptocurrencies should rise.
And on days when everyone feels good, NVDIA is up, Nasdaq is up, interest rates are down, and no one cares about inflation, cryptocurrencies should go down. And does it work like that? it's not. It acts in direct contradiction to its own theory. The correlation with Nasdaq is around 75%.
So to me it's just another way to keep people guessing. Research doesn't have any data points to say it's right, nor can it say it's wrong. ”
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