In the middle of a pandemic, the world waits for Joe Biden's presidency with a berated breath. Everyone's attention is focused on the inauguration of the elected president. The Presidential Inaugural Committee has decided to make much of the event virtual. Social distancing, safety, and health protocols will also be in place.
Joe Biden's inheritance is not something to be envied. Although the stock market is at an all-time high, the budget deficit and weakened USD, as well as the potential economic crisis and lack of stability, are challenges Biden has to face.
Biden inherited a weakened national currency that fell by 12% from last year's high. It makes it easier for buyers to obtain US stock and determines the competitiveness of US products.
He also inherited a national debt of around $28 trillion from Trump, nearly 40%. Because of the expenses caused by a coronavirus, he has to deal with a massive balance sheet. Tax cuts in 2017, flood spending, and the economic crisis caused by the global pandemic have all weighed USD to become an affordable reserve currency possibly.
Federal Reserve does not seem to have sufficient power to defeat the next crisis. The US central bank has declared 0 interest rates. The central bank will not be able to maneuver if the economic situation worsens or a new crisis hits the nation.
Regarding the stock market, S&P500 is to rise in the first 100 calendar days during Biden's presidency. Meanwhile, betting on Bitcoin has become the most popular trades in financial markets, according to Bank of America's fund managers' survey.
While betting against the weakened USD has become the third most popular trading choice, bitcoin is becoming increasingly popular as a digital currency, akin to gold asset and inflation hedge. The cause is attributed to a 230% rally within the last three months. Bitcoin hit the record of $41,900 earlier this year. Ethereum is also leading the market, becoming the top cryptocurrency of the year with a 92% gain.