VanEck CEO Warns Next US Financial Crisis Will Start In Washington, Urges Investors To Hold ‘Real Assets’ Like Gold and Bitcoin
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VanEck CEO Jan van Eck urged investors to hold gold and Bitcoin.
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He said that these assets will act as a hedge against U.S. government spending, and remain a long-term Bitcoin bull.
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Van Eck expects the U.S. to inflate its way out of its debt, and doesn't think AI will ease the pressure by pushing prices down.
VanEck Chief Executive Officer (CEO) Jan van Eck said that the next U.S. financial crisis would begin in Washington rather than in the banking system, and said investors should hold "real assets" like gold and Bitcoin (BTC) as protection.
In an interview with Anthony Pompliano on Thursday, van Eck said, "For the entirety of U.S. history," financial crises have started with banks. This time, however, he expected the trouble to come from government debt. "This is going to be started in D.C. and no one can bail us out. And I think the rest of the world sees this," he said.
That outlook shaped his view on portfolios. When asked how investors could protect themselves from U.S. government spending, van Eck pointed to hard assets. "You have to have real assets, gold and Bitcoin in your portfolio. You don't know if it'll pay off," he said. He was clear about his position on Bitcoin over the longer run, and said, "I'm a long-term bull, so I definitely think it would be higher in 10 years.
No AI Bailout
Van Eck saw no easy way out for Washington, and said, "We're going to inflate our way out of our debt."
"There's no easy answer, and it's not going to be pretty." He also dismissed the idea that artificial intelligence (AI) would ease the pressure by pushing prices down. "All technology is deflationary," he said. "There was great technology in the 70s, but we had runaway inflation."
Bitcoin's price was down by 0.2% during the past 24 hours. On Stocktwits, retail sentiment around Bitcoin was in the 'bearish' zone, while chatter around it was at 'normal' levels over the past day.
Where Does Van Eck See Value?
Rather than adding more crypto products, VanEck is now pushing active management. He said it made sense because most financial advisers struggled to choose between tokens like Avalanche (AVAX) and Ethereum (ETH). "Most advisors can't pick Avalanche versus Ethereum or these kinds of things," he said.
According to the VanEck CEO, layer-1 blockchains, the base networks that other crypto applications run on, along with the trading platforms, would hold up. "The foundational ones will survive, I think, and then the exchanges, I think, will survive," he said.
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