It is CryptoPortfolio project and my name is Dan.Today I will tell you why soon the whole world will experience economic turbulence and why holding Ethereum and Bitcoin can be quite profitable during these dark times.BTW, this presentation consists of economic analysis of US economic conditions.I think you clearly understand that our world is interconnected.If something big happens in one country, the other can feel the effects of this event almost instantly.So here we go, the general reasons why the United States of America will soon experience stock market collapse and how we, Ethereum and Bitcoin fans, can benefit from that event.First of all, the appearance of so called “too big to fail” institutions which are receiving money almost unconditionally from the US government because the fall of these institutions can lead to much dire consequences.Then, low US interest rate contributes to the debt problem.Low interest rates incentivize everybody to borrow more, increasing the problem in size.Debt accumulation is the direct consequence of the low interest rate.

I will expand on it a bit later.According to the Federal Reserve, the money supply in the United States doubled since 2007.That’s another reason you should buy more Ethers and Bitcoins.Remember the dot com crisis which happened because of the stock market overvaluation of certain companies?The coming crisis is no exception.The bubble will burst with a lot of bad consequences.All the little reasons lead us to the financial catastrophe of 2017 ( I think this year it will be with almost 100% probability)And now let us look into the picture of stock market collapse with more precision.What will we see?Debt is the first and the most significant contributor to the stock market collapse which is about to happen.As you can see from this graph, the debt levels are growing each year after the 2008 economic crisis.While interest rates fall, the interest payments grow.Who could predict that companies will borrow more when interest rates are low.So, debt in the US has doubled since 2017 to 2015 for non-financial companies.Average interest payment decreased to 4% which is 2% lower than it was in 2007.Interest expenses have increased by 40% which is very significant for US market.Another important indicator is NET Debt divided by EBITDA.

IN short, Net Debt is all companies liablilities minus all liquid assets.And EBITDA is earnings before interest, tax, depreciation and amortization.This graph shows us the increase in this ratio since the end of 2010.Basically, the bigger this ratio, the harder it is to service debts for companies.This problem of servicing debts creates another problem, the defaults of the companies which can no longer service.The current levels of this ratio already exceed the economic collapse of 2008.Summing it up, companies now have tougher time than during the last economic crisis.It is that bad.The debt accumulation problem creates another problem which is the artificial increase in companies’ capitalizations.I will tell you why this happens.This graph shows you the bonds issuance, this way companies can borrow funds at much lower rates than from banking institutions directly.As you can see, the bonds issuance has dramatically increased.And Dividend recapitalization increased too.Basically, dividend recapitalization means that company spends borrowed funds on repurchasing its own shares from the market, artificially increasing, most of the time, its capitalization and average share price.So, US has doubled its bonds issuance since 2007, which amazes me, to be honest.According to the latest data from Bloomberg ,the bonds issuance in 2016 exceeded 1 trillion dollars.

Just mind-blowing sum of raised money.In 2015 the companies spent more than 8% to repurchase their own shares to artificially increase their share price.They used the borrowed funds, that’s what is interesting!This leads to artificial share price growth and overheated financial market.Another great indicator is EBITDA divided by Interest payments.ecuador bans bitcoinIt shows how tough it is for companies to service their debts.AS you can see the number was lower in 2009, the peak year.cae el precio del bitcoinBut it looks like that soon this will be the past, because the US is aggressively riding towards lower numbers.So, the less number the harder it is to service the debts.This is another great indicator as Net Debt/EBITDA.The peak was 2009, we will soon see even lower numbers in the United States.Defaults.litecoin miners wiki

I think everybody know what default is and how serious it is.Here we go.These are the columns which show defaults for first 6 months of each year.As you can see the 2016 was significant among all other years , except, may be, for 2009 which was the year filled with the biggest amount of defaults.Summary.bitcoin difficulty in may 2014Defaults are reaching crisis levels.armory without bitcoin coreThis is partly due to the fact that many energy industries lost profitability and they went bankrupt.Defaults are usually happening in the middle of the crisis so defaults are not that high yet.bitcoin mlpWe are still yet to see how powerful the next financial crisis will be.What does P/E means?o'que é a moeda bitcoin

But I think you should see it as a capitalization.In other words, it is net profit.So if we combine it, we divide capitalization by net profit and we get our ratio.bitcoin graph inrBasically, it shows us overvaluation or undervaluation.moon bitcoin trickFor example, if you measure tesla P/E you will get some fantastic number because Tesla isn’t profitable at the moment.So this number is derived from the stocks.And professor Shiller is responsible for keeping this ratio alive, showing how undervalued or overvalued stock markets in the United States are.So, P/E shows us the number which is capitalization divided by annual net profit.P/E shows undervaluation or overvaluation.At the moment, P/E exceeds even the pre crisis levels of 2008!That’s a huge indicator of stock market overheating!It is not that bad as the situation in 2000s when P/E index was bigger than current numbers but it still is dangerous to have this overoptimistic numbers.This is basically the repeat of Shiller index.

It shows undervaluation or overvaluation of the stocks.In this example, it shows the valuation of S&P500.EV basically means capitalization, EBITDA was discussed earlier.So this graph shows us the annual change in EV/EBITDA ratio.As you can see, different years were marked with different values.2009 shows us the lowest value which was a result of the market collapse, it was the time when money started aggressively leaving the stock market.Ev/EBITDA is almost the same as P/E.This ratio exceeds levels of 2007, which was the year after which there was an economic collapse in the world.At the moment, the ratio shows us that the stocks are overbought and market is overflown with liquidity which is bad for market valuation of different companies.Its like you have a lot of money you do not know where to invest.Finally, these are all the reasons why the economic collapse is inevitable.If you have any questions, I am ready to answer them in the comment section or in telegram.And now we have come to the most interesting topic which is how will economic crisis affect the prices of Ethereum and Bitcoin.

And we look at them as cryptocurrencies but we shouldn’t forget about Ethereum advantage or so calledEthereum has advantage in from of Smart contracts and the associated price opportunities.Smart contracts will have additional influence on Ethereum price, because all the new ICOs are conducted on this blockchain.If you want a little more, I advise you to watch my video on “Ethereum price and why Ethereum will be bigger than Bitcoin”What are the features whci will be significant for Ethereum and Bitcoin when crisis happens?First of all, it is defence against double spending attacks.Then, the inflation which is very low and supply of coins which will be limited in both blockchains.In details, Ethereum will have limited supply of about 100 million ethers, and Bitcoin will have supply of about 21 million bitcoins.That’s the greatest advantage, considering the dramatic increase of money supply in almost every country.Inflation proof cryptocurrencies can save and increase your wealth during the tough economic times.Then, the payment mechanism.

It is not that well developed and this is the advantage right now.Who knows when bitcoin or Ethereum will become something usual for all people , but that is the time when those cryptocurrencies will cost a lot of money.Finally, undiscovered price.We still do not know the price which will be a norm for Ethers and Bitcoin in future.And that’s a great thing!You buy and hold!And that is all!It has to take time for cryptocurrencies to discover its true price on the money markets.And by that time even small hodles (or holders) may be will become millionaires in venezuelan terms.I am joking, of course I mean United States Dollars terms.There are the possible outcomes for Ethereum and Bitcoin duruing the crisis times!The first is growth of Bitcoin and ethers.They are considered to be safe heavens having a limited coin supply.The other possibility is decline.We still do not know how market will react to economic downturn.But I think that there is a higher possibility of growth than there is possibility of the decline.At the end of the day you will make your own decision based on all the information which is provided to you.