Part 8/13:
Market Recession Dynamics & Leverage Strategies
Understanding recessions is critical. The presenter offers a nuanced outlook:
Recession Indicators: Central banks tend to cut interest rates during downturns, spurring borrowing, equities, and real estate rallying due to increased liquidity.
Inflation and Devaluation: Excess liquidity fuels inflation expectations, raising asset prices and weakening currencies, which can boost exports and attract foreign investment.
Leverage Risks: Leveraged ETFs and tokens—such as 3L tokens—are double-edged swords. They amplify gains but also losses, recommending only short-term use (no longer than 12 weeks) unless managed carefully.