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Recently, Musk posted a chilling tweet on his official Twitter account that revealed a bleak outlook for the global economy, which is truly worrying. He claimed that a severe global recession is irreversible and that the Fed should not continue to raise interest rates because their data is already seriously lagging and a mild recession is fast approaching.
Musk owns many well-known companies, such as Tesla, SpaceX, Starlink, Model π, Neuralink, and OpenAI, and his words have had a huge impact in society, especially when it comes to everyone's economic interests. He stressed that the Fed should not raise interest rates, as this would only exacerbate the downturn in the economy and could even lead to a deeper recession. He warned everyone to remember his words.
The death of the canaries in the mines has already happened, and like the determined miners, they have unfortunately died. The image is reminiscent of more banks failing and an economic storm sweeping through. Canaries are often used to detect carbon monoxide, and Musk likens it to an economic bellwether whose collapse portends economic instability, even from the solid Swiss banks. This storm will only intensify.
Musk believes that he personally has more real-time global economic data than anyone else, thanks to companies he leads, such as Tesla, Starlink and Twitter. This data gives him deeper insights that allow him to better understand what is happening in the current economic sector.
So, what exactly will the Fed's rate hike have on us? In simple terms, a Fed rate hike would result in more dollars flowing back into the banking system, reducing the supply of dollars in the market, which in turn would push up the value of the dollar, making it more cost-effective to buy goods or assets from other countries with the same amount of dollars. On the contrary, the Fed's rate cut will cause the dollar to flood the market, increase supply, and depreciate the dollar, which may trigger a massive divestment of investors in other countries and deprive other countries of their assets.
In the current global economy is still dominated by the US dollar, the continuous interest rate hike of the US dollar will curb inflation in the United States, but it will lead to the depreciation of other countries' currencies, causing problems in the field of import and export and cross-border e-commerce, causing prices in other countries to soar. In addition, once the dollar cuts interest rates, those businesses that invest in the dollar will also suffer.
But why do we feel a gradual recovery in the economy at home? The reasons are twofold. First of all, the state has achieved good results in control and control, starting from the "20th National Congress", the country has gradually shifted to the domestic market as the main body, built an economic development pattern of "international and domestic dual circulation", reduced dependence on the international market, and cultivated endogenous economic momentum.
Secondly, observing the recent May Day tourism boom, although people are still keen on tourism and consumption, more attention has gradually shifted from high consumption to low consumption, and people are more willing to enjoy the scenery, climb the mountains, and enjoy barbecue. In addition, those who had planned to travel abroad also set their sights on domestic tourism.
So, what should ordinary people do to deal with the economic crisis that may come? First of all, don't invest blindly, especially don't buy items that are not urgently needed, such as real estate. Secondly, a certain amount of hard currency should be kept, and if conditions permit, the purchase of some precious metals can be considered. However, the most important hard currency is our own health and knowledge, and continuous learning and upgrading of our skills is the most valuable investment.
In addition, there is no need to worry too much, according to the experience of past economic crises, it is often the middle and upper classes, especially those at the top of the pyramid, who are hit hard, while the middle and lower classes are less affected. The economic crisis is like fishing in murky water, the more mixed the water, the more the fish need to remain calm, silently do their job, and avoid becoming the object of capture and exploitation.
In these uncertain economic times, prudence and rationality are our best friends, not blind panic. Hopefully, we can be well prepared to meet possible challenges and protect our wealth and future.
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