- Catherine Wood predicts that the US economy could enter a “deflationary boom” if the phase of the “rolling recession” ends and politics receives more scope.
- ARK Invest adapts investments, while Wood emphasizes the growing role of Bitcoin as an alternative system in the middle of financial uncertainty.
Catherine Wood, CEO from ARK Invest, once again expressed an opinion that caused discussions among investors. She claims that many people may not be aware that the market is now in the last phase of one Rolling recession located. However, this phase offers a fantastic opportunity for Wood.
It is of the opinion that this disorder of the Federal Reserve under Jerome Powell and the Trump administration, should it come to power, will provide more scope for flexible monetary policy.
In our view, the market today is discounting the last leg of a rolling recession, which will give the Trump Administration and the Powell Fed many more degrees of freedom than investors expect, setting up the US economy for a deflationary boom in the second half of this year. https://t.co/p2qOq8jqAS
— Cathie Wood (@CathieDWood) March 10, 2025
Deflation as a gateway to growth
According to Wood, investors could misjudge the extent of political flexibility that results from these circumstances. If this is the case, the US economy could enter a “deflation boom” in the second half of the current year, as it calls it.
Deflation is sometimes associated with an economic downturn under the global uncertainty. However, Wood sees this a chance for a quick expansion, especially in the areas of technology and innovation.
The investment approach that ARK Invest has just chosen is one of the most important signs for Wood’s confidence. Two companies standing for the digital technology and finance revolution, Tesla and Coinbase, increased the company’s participation.
In contrast, ARK Invest has reduced his commitment to Block and Sofi, which indicates a changed approach that is supposed to adapt to the dynamics of the market.
Shadow on ARK-Invest subsidiary
Although Wood’s optimism has attracted attention, he did not remain without challenges. Officials from the province of Ontario have accused Emerge Canada, an international subsidiary of ARK Invest, that they have misused $ 6 million in investor funds. This case shows how bad fund management can undermine the trust of investors alone.
Although he has no direct connection to ARK Invest, the problem remains more general, especially with regard to the openness and responsibility of the financial industry.
Wood sees Bitcoin as an investment securing
Wood, on the other hand, also emphasizes the potential of Bitcoin as a asset, which, in addition to gold, is increasing more and more at the center of the investment environment. According to CNF, Wood Bitcoin sees gold as an important competitor, especially in economically uncertain times. She emphasized that Bitcoin has remained strong during the banking crisis, an indication that he is increasingly seen as a security.
Wood also provided a graphic that illustrated the long -term upward trend from Bitcoin compared to gold in order to underpin its point of view. This is a foretaste that Bitcoin is gradually establishing itself as a replacement investment.
Although volatility is still considerable and many investors doubt this claim, Wood is certain that this tendency will become more noticeable in the next few years.
Future of the US economy
Wood’s interpretation of a deflationary explosion must certainly not be taken for bare coin. Many analysts warn that too low inflation could lead to economic stagnation. According to Wood, investors should start seeing things differently.
It is of the opinion that technological progress such as AI and blockchains will drive the economy into an unprecedented heights of expansion.
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