Tesla (TSLA, Financial) CEO Elon Musk recently tagged the United States as a financial crisis due to the country’s humongous $35.7 trillion debt and $1 trillion in annual interest. His concerns are looking valid at this time when the prices of bitcoin have risen sharply, as well, as gold retains a safe-haven appeal.
Musk’s statements align with other concerns about economic fundamentals in America, including fiscal issues that could potentially make the country bankrupt. This has been compounded by an unprecedented debt crisis at the Federal Reserve that threatens to overwhelm the system and inflationary concerns that have prompted some of the most legendary money managers in the market to alter their investment approach.
Musk’s aversive position is based on an aggressive Bitcoin market that is now being referred to as digital gold. The change comes as both resources have posted gains from a package of trends that see investors increasing their appetite for commodities and currencies deemed as inflation and risk hedges.
Initially, Musk kept his economic fears and advice separate from politics. However, He has recently been vocal about Trump’s return to the White House. In contrast, an administration friendly to crypto could coexist with traditional assets like gold.
With time passing, Musk’s dire predictions about America’s financial status continue to demonstrate just how fragile the world’s economy has become and how much more likely we are to see cryptocurrencies as part of the new financial systems.
This article first appeared on GuruFocus.