Institutional Investor Hall of Famer Richard Bernstein is sounding the alarm at Bitcoin.
He warns that Bitcoin is a bubble and that crypto fever is pushing investors away from the market groups capable of making the biggest profits, especially oil.
“It’s pretty wild,” Richard Bernstein Advisors’ CEO and CIO told CNBC’s Trading Nation on Monday. “Bitcoin was in a bear market and everyone loves the asset. And oil was in a bull market and you never really hear about it. People don’t care. “
Amber, who has spent decades on Wall Street, calls oil the most ignored bull market.
“We have this big bull market in commodities and everyone says it doesn’t matter,” he said.
WTI crude oil is trading at its highest level since October 2018. It stood at $ 70.88 on Monday and is up 96% over the past year.
Bitcoin may be up 13% in the past week, but it’s still down 35% in the past two months.
Although Bitcoin saw a meteoric surge last year, Bernstein suggests that a rollback to this level would not be sustainable. He believes the rush to own Bitcoin and other cryptocurrencies has become dangerously parabolic.
“Bubbles are different from speculation in that bubbles permeate society. They go outside financial markets,” he said. “With cryptocurrencies, and most likely most technology stocks, you can see that now where people talk about it at cocktail parties.”
Right now, Bernstein is most optimistic about companies that are not geared towards innovating or disrupting the economy. He was pessimistic on technology stocks in 2019.
“Your portfolio could suffer badly”
“If you’re on the wrong side of the seesaw in the next or two years, maybe five years, your portfolio could suffer badly,” said Bernstein. “The side of this swing that you want to stand on is the inflation-friendly side that most people don’t invest in.”
Bernstein predicts inflation will take many investors by surprise, but at some point he expects the tide to turn.
“In six months, or 12 months, or 18 months, growth investors will buy energy and commodities and industrials because that’s where the growth will happen,” said Bernstein.
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