Bank of America Says Bitcoin Can Act as Hedge Against Stock Markets Crash

Bank of America strategist Michael Hartnett has come to these conclusions that commodities, cash and cryptocurrencies could perform well against equities and bonds amid a combination of inflation shocks, recession and Fed policies, Business Insider has learned.

Investors in the stock market should brace for the S&P 500 falling below 4,000 by the end of 2022, which creates downside potential from 11% from current levels.

According to the analyst, as consumer demand recovers, supply chain disruptions persist, and the war in Ukraine continues, inflation has “gone out of control” to peak levels in 40 years. He has added:

“Inflation will trigger a recession. Almost all such episodes in the past preceded it. Expectations of higher yields on the government debt market and a weaker dollar have increased the likelihood of a downturn in the economy.”

He has warned that an inflation shock is followed by an interest rate shock and then a recession shock.