My predictions will cover stocks, unemployment, COVID19 within a Q2 timeline. Bullets with a month summarize predictions within that specific timeframe. Bullets with a topic are reflections throughout Q2.
Q2 Short Term Macro
- APRIL — stocks will stabilize in a +1/-1 range around 25K. This is achievable between a backdoor understanding between the Fed’s printing money to guarantee to banks their holdings are secure. This keeps society from panic as it cloaks the economic reality we are entering a depression.
- MAY — mass protests to end of quarantine begin. Governments will be pressured to reopen. Reopening is destined to be a disaster. Local governments forego science giving in to pressure from their people. Failures will be measured by who fails the least. The public will be briefly uplifted by being released back into the public and getting their way. Stocks now have a reason to challenge for all-time highs attempting to apply steroids to this newfound euphoria.
- JUNE — this feeling of uplift will be ephemeral as we will be sobered when we realize life is not returning to normal. The reality of COVID19’s impact on changed behaviors in reopened society will wreak havoc on all economic projections. People will spend less, refuse to go into areas of high proximity, and businesses will continue to suffer.
- UNEMPLOYMENT — unemployment numbers will not get better but they will slow down in June. This will send stocks higher as the economy looks to be flattening the unemployment curve. The problem is jobs will not be replaced. America will start to form an underclass of permanently unemployed citizens measuring between 20%-30% of Americans.
- COVID19— wave 2 silently begins in May when we reopen the country. We will not learn from wave 1 as cases and deaths will look ok throughout May. Cases start accelerating again in mid-June and by end of June, the death count will begin to rise again setting up panic and the beginning of the fall in Q3. When June arrives we will know we shat the bed on COVID19.
- US DOLLAR — we will announce a new stimulus package(s) ranging between $6-$8 trillion to be rolled out between late Q2 and Q3. The public will be told it’s good enough to cover us through the year end but it will likely run out early Q3 and the discussion for an even larger package will commence then. The bright side is the Fed will have a properly greased payment channel, from Q1, to efficiently get money to both businesses and individuals. That will come to haunt us later in Q3 when the election cycle hits.
- STOCKS — stocks and unemployment will continue displaying a deeper divergence. 1% will continue to get richer through advances in technology while 99% suffer from skill set deficiencies.
Q2 Bitcoin
- Bitcoin’s halvening will occur on May 12. It will be met will little fanfare in regard to price action. Pundits will write headlines about how Bitcoin is dead.
- Bitcoin will continue its behavior as a trojan horse as swarms of people around the world will once again be exposed to Bitcoin in every headline in May. 30% of people will write it off as a scam without taking a second to look further. 70% of people will “Google: Bitcoin” in hopes of a get rich quick scheme. 9/10 of those people will stop searching once they see the price isn’t moving upward in May or June.
- That last 1/10 of the 70% above will persevere, researching beyond just “what is the halvening?” and “is now a good time to buy bitcoin?”. Those people get hooked by one of Bitcoin’s core properties (scarcity, decentralization, provability, transparency, etc.) which now directly corresponds to an acute pain they currently experience (negatively impacted by stocks, decreased trust in institutions, loss of faith in government, etc.) causing them to willingly explore the fundamentals deeper. These people go down the proverbial Bitcoin rabbit hole and begin to understand why it’s worth something, why it’s never been more relevant, and why it is a symbol that represents a fighting chance at making them better off tomorrow.
Q2 Ethereum
- Ethereum will celebrate Bitcoin’s post halvening price stagnation. Beware of anyone telling you this because those people only expose their lack of history in the space. Historically, Bitcoin does not rally after the halvening. The halvening historically servers a very different purpose: educating new curious minds.
- Ethereum bulls will make the case that Bitcoin has peaked and that it is a old, slow, archaic technology compared to Ethereum. On the surface, it’s very seductive to fall prey to this line of logic; especially because the price of Ether is substantially more affordable than Bitcoin. Tread lightly, you will get burned.
- Ethereum articles lambasting Bitcoin will be spread like wildfire from their marketing engine likely driving Ethereum prices upwards. 90% of this crowd will graduate from Ethereum into even more speculative purchases in Altcoins for the promise of even greater gains. The majority who choose Ethereum will get burned on long time horizons. There are too many technical gaps, vaporware sold, scammers around every corner.
Q2 Altcoins
- This is an Altcoin scammers time to shine (or shall I say, scam). This is when there is peak curiosity about Bitcoin with an ironic side effect of the majority of buyers leaning towards Ethereum.
- Altcoin folks hang by the coattails of Ethereum. Altcoin markets are the wild wild west. It’s where a coin can go up 1000% in a day for no reason at all. It’s where the real gamblers go to bet against the house.
- What new players in this market don’t realize is that the market caps on some of these are so tiny they can be easily manipulated by the coin owners themselves who gratuitously awarded themselves the majority of the joins at birth at no cost. Pumping a few hundred thousand into a market can setup what looks like a bull stampede. When really the original “whale” is just looking to fleece the new entrants.
Q3/Q4 Forward Look
- Q3 — UBI will stop being a punching bag for pundits and will start taking shape in Q3.
- Q3 —throughout Q2, stock indexes will fight hard to stay in and around 25K. But by end of Q2, it will reach or exceed the all-time highs. Only the most bullish investors will remain, most of main street will take their gains or losses off the table leaving banks to play chicken against the Fed.
- Q4 — With only the insiders (big banks) remaining playing chicken against the Fed’s… even they will realize they are now playing the final round of music chairs and only the Fed gets to decide when the music stops. The banks will a deceitful game of musical chair amongst each other, convincing one another they are in for the long haul while they start to sell to cash out their positions.
