Zero Interest Rates Create Bubbles and ‘Tumors Like Bitcoin’, Black Swan Author Doubles Price Target from $0 – Bitcoin (BTC/USD), Coinbase Global (NASDAQ:COIN)

The former Wall Street trader and author of The Black Swan has been a vocal critic of the leading cryptocurrency Bitcoin BTC/USD for several years and did not hesitate to do more recordings last week.

What happened: Author and former options trader Nassim Taleb said many people don’t understand how the economy works thanks to the Federal Reserve’s current interest rate environment.

“I think we’ve had 15 years – 14.5 years – Disneyland that basically destroyed the economic structure. Think about it – no interest. Anyone who says they’re 40 has no experience in the markets,” Taleb said on CNBC’s “Squawk Box.”

Taleb said people under 40, which include millennials and GenZ, don’t know “what the time value of money is.”

Taleb argues that cutting interest rates too much could have lasting effects on people and the economy.

“Zero interest rates for a long time, you hurt the economy, you create a bubble, you create tumors like bitcoin.”

Taleb sees the price of Bitcoin falling further with an eventual loose target of $0.

“Bitcoin is still being used, it’s still at $20,000. It’s not $1,000 or zero.”

Related Link: How to Buy Bitcoin

Why it matters: Taleb is the author of The Black Swan, a book based on the concept of Black Swan Events, which are unpredictable occurrences of massive impact.

The author was previously a proponent of cryptocurrencies, even urging people to use them to bypass financial systems. Taleb had a change of heart and later reversed his attitude, arguing that cryptocurrencies may be worthless.

Taleb also complained about the cryptocurrency platform’s customer support Coinbase Global COIN and closed his account.

In 2021, Taleb called Bitcoin a “failure” and went on to say the leading cryptocurrency has “characteristics of an open Ponzi.” Taleb argued that Bitcoin had no properties to make it a hedge against inflation and was instead a “failed currency” and pyramid scheme.

To hedge against inflation, Taleb instead recommended buying land instead of bitcoin.

BTC Price Action: Bitcoin is trading at $19,743 at the time of writing. The leading cryptocurrency is down 8.4% over the past week and over 58% year-to-date in 2022.

Photo: Courtesy of nrkbeta on flickr

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