bitcoin (BTC) is in short supply at Tesla, even as its CEO predicts that US inflation has already peaked.
Talking at Tesla’s house Annual Meeting of Shareholders 2022 On August 5th, Elon Musk predicted that the next US recession would only be “mild to moderate”.
Musk on costs: “The trend is down”
after recently selling almost everything of his $1.5 billion BTC holdings, Tesla is seeing the emergence of exactly the kind of economic landscape in which risky assets thrive.
During a Q&A session at the Annual Meeting, Musk revealed that the six-month commodity price for Tesla parts is already getting cheaper, not more expensive.
Commodities, he said, are trending lower, giving a hint that inflation has already reached its highest levels.
“We have a sense of where prices are going over time and the interesting thing we’re seeing now is that most of our staples, most of the stuff that goes into a Tesla, not all of it, more than half of it, the prices have a downward trend in six months,” he said.
“This could change, obviously, but the trend is down, which suggests that we have passed the peak of inflation.”
Recovery from an inflationary period in which commodities are going downhill provides fertile ground for the recovery of risk assets, including crypto. Theoretically, this is due to lower inflation, which means fewer restrictions by the Federal Reserve, providing favorable conditions for risky investments.
If strength returns to the markets and cryptocurrencies outperform, the trend will be ironic for Tesla, which shed virtually all of its BTC exposure, with a gain of only $64 million – last month.
At that time Musk additional that BTC could return to the company’s balance sheet at a later date, and that the decision was not a comment on Bitcoin per se.
Meanwhile, the Annual Meeting produced more optimistic macro predictions, including a possible US recession that would be “relatively mild” and last about eighteen months. Inflation, Musk added, “will fall rapidly.”
A career higher in the second half of 2022
The irony of Musk’s comments was not lost on crypto commentators, and other voices are already betting that a rally in stocks is here to stay.
Related: Bitcoin Price: ‘Expected’ Weekend Volatility with $22K Level to Hold
Among them is Fundstrat Global Advisors, which this week noted that markets have historically bottomed out half a year before the Fed stops tightening through key interest rate hikes.
The firm predicted that the second half of 2022 could push the S&P 500 to 4,800 points, a boon for crypto markets that is still strongly correlated with broader stock movements.
This is important to note
– Markets know rates are rising
– is the “shock” that damages the marketsToday’s job report is not a “shock”
Get the “first word” on https://t.co/Vsy6WwaIxa @fs_insight https://t.co/HtuTCJANtO
— Thomas (Tom) Lee (not drummer) FSInsight (@fundstrat) August 5, 2022
Like Cointelegraph reported, more information about Bitcoin’s potential comeback came this week from the world’s largest asset manager. BlackRock, with over $9 trillion in assets, has partnered with US exchange Coinbase to bring crypto exposure to clients.
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