Macro-economist Henrik Zeberg warns of worst crash since 1929

If you ask macro-economist Henrik Zeberg, there is currently a chance of a scenario that comes close to the economic crash of 1929. We must therefore prepare for a recession or crisis that is more severe than that of 2008. It remains to be seen to what extent the crypto market can withstand this at the moment.

“The similarities are scary!”

Henrik Zeberg, a popular macro analyst with a following of more than 100,000 people on Twitter, sees huge similarities between the current development of the economy and that of the period 2007 – 2008. At the time, the recession also started with a decline in activity on the housing market (blue line) followed by a massive rise in unemployment (orange line).

If we are to believe the words of the analyst, there is a possibility that we will have a bigger crash than that of 2007-2009 and that we may also go deeper than during the crash of 1929. That last crisis is also known as the Great Depression.

In that respect, it may very well be that dark times are coming. We are already seeing the first signs of this with the problems at parties such as Silvergate Bank and Silicon Valley Bank, which could no longer keep their heads above water due to the higher interest rates of the Federal Reserve.

What does this mean for Bitcoin?

It remains to be seen what this will ultimately mean for Bitcoin. That’s hard to say, as it would be the first time in Bitcoin’s lifespan that the asset has entered a global economic crisis. In the most likely scenario, we will see a massive drop for all risk assets first, and Bitcoin will be no exception.

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On the other hand, Bitcoin is also the answer to the problems we are seeing now, which may make people choose to flee to the decentralized currency for part of their capital. In the long run, this can only be good for Bitcoin, as it means central banks have to turn the money printers back on and interest rates have to go down.

Lower interest rates and a larger money supply mean that the relative scarcity of fiat currencies like the US dollar is decreasing, which is good for Bitcoin. After all, Bitcoin has an absolute scarcity of 21 million units and that becomes more attractive as governments and commercial banks make the money printers run faster.

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