- Novogratz believes the US election will make stocks unsafe
- Bitcoin and gold are known as stores of value and hedge against inflation
- The billionaire said the correlation between Bitcoin and the stock market won't last forever
Michael Novogratz, CEO of Galaxy Digital, said it was dangerous to be deep in the stock market at this point, with only 35 days left for the 2020 presidential election. Despite the recent surge in the greenback, Novogratz said he was more optimistic about Bitcoin and gold and skeptical about the US dollar ahead of the November event.
In an interview with CNNNovogratz stated that the equity rally the market has seen in recent months would soon be losing steam. He pointed out that Tesla and Apple stocks have already hit their highs and that the Nasdaq can now trade lower, about 10,000 or another 11% below current levels, he added.
Novogratz said the upcoming elections are the main external factor behind the high equity volatility. The billionaire said that at some point it would be okay to buy stocks. However, this is not currently the case, which would depend on who won the elections. He also said he thinks Democratic candidate Joe Biden would win, but the market might not like it, citing some of Biden's campaign promises. "If Biden wins, he'll raise taxes, especially capital gains tax. The market won't digest that well," he said.
Although Bitcoin is said to be correlated to the stock market, Novogratz believes the correlation won't last forever. "If the Nasdaq were to fall 5% today, Bitcoin would likely be lower, not higher. But I think you will see those correlations break down." he told CNBC.
He also touched briefly quantitative easing Measures, including printing more money, to revive the economy amid the pandemic. "We don't know what's going to happen, the dollar uncertainty and inflation must be way higher than our lifetime sales," he said.
Gold and Bitcoin are often viewed as a hedge against inflation. Novogratz said he preferred Bitcoin because it was much earlier in the adoption cycle. He mentioned that while he believes the price of gold will continue to rise, he expects Bitcoin to climb to $ 50,000 in the next two years.
(tagsToTranslate) Bitcoin (t) Gold (t) Exchange (t) Michael Novogratz (t) USA. Elections (t) Joe Biden