The Milk Road Show Can Crypto & US Equities Continue to Grow in a World of Endless Inflation? w/ Jonny Matthews
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Feb 5, 2025 In this discussion, macro specialist Jonny Matthews, a former portfolio manager at Brevan Howard, shares his insights on the resilience of the U.S. economy and its implications for investments. He questions if crypto can flourish amid persistent inflation and explores global economic divergences. Jonny emphasizes the need for strategic reassessment in light of strong economic growth and government policies. He also highlights challenges in making financial decisions, urging listeners to focus on informed investment strategies rather than retreating to cash.
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US Economy Strength
- The US economy is currently robust, with high employment and strong balance sheets.
- Jonny Matthews believes this strength is driven by productivity growth, unlike other economies.
US Productivity Growth
- US productivity improvements outpaced other economies due to a flexible labor market.
- The pandemic-driven labor reallocation allowed workers to find better-suited jobs, increasing efficiency.
Inflation and Liquidity
- Despite low inflation pre-pandemic, current high inflation and US deficits may persist.
- Matthews suggests the Fed might tolerate 3% inflation if the labor market remains strong.