Experts at Nordea, one of the largest commercial banks in Northern Europe, forecast a wave of bankruptcies to begin in the United States. Analysts have come to this conclusion based on data analysis over the past 15 years.
In April, the US unemployment rate reached 14.7% — this is the worst result since the Great Depression. In February, the figure was 3.5%. The cause of the layoffs was the coronavirus pandemic. Many companies lost revenues, and management began to cut back to reduce costs.
U.S. Unemployment Rate and Corporate Bankruptcies
A wave of bankruptcies can lead to the stock market collapse. On the background of the pandemic, stocks of many companies have already fallen in price. So, over the past three months, shares of Delta Airlines, American Airlines Group and United Airlines Holdings have fallen by 67–75%.
In addition, the shares of the largest US retail stores have lost in price at about the same level. For example, Macy`s quotes for the same period fell from $ 17 to $ 5, GAP – from $ 18.3 to $ 7.7. Some companies have indicated a possible suspension of operations, for example, J.C. Penney, and Neiman Marcus Group and J. Crew Group filed for bankruptcy protection.
In times of crisis many pay attention to cryptocurrencies in the stock market. In 2020, Bitcoin has repeatedly shown a correlation with the US stock market. However, now the correlation between the first cryptocurrency and the S&P 500 index has decreased. According to The Block, over the past month this figure fell from 0.53 to 0.15 points.
We also note that recently there has been a halving in the bitcoin network. Block 630,000 was mined on May 11, 2020 at 22:23 Moscow time by AntPool pool. The reward for adding it, excluding commissions, was 6.25 BTC, while it was 12.5 BTC for the previous block.
At first, Bitcoin did not immediately respond to halving. However, now it is trying to take the round mark of $ 10,000. Most experts agree that this is only the beginning. So this is an opinion of the head of Galaxy Digital Mike Novogratz, and the co-founder of Morgan Creek Digital investment company Anthony Pompliano.
Analysts at AMarkets note: according to statistics, the growth of BTC begins immediately after the halving, first the local maximums are updated, which now correspond to the level of $ 13,500. Then, after a short correction, which lasts several weeks, the growth continues, and a new peak is reached within a year.
Accordingly, the next update of the price maximum may occur in the summer of 2021, which means that it is time to invest in BTC. Problems in the stock market can also strengthen the position of the first cryptocurrency.