Sen. Bernie Sanders of Vermont got into a conspicuous argument over the weekend Tesla (NASDAQ:TSLA) CEO Elon Musk. The duo exchanged views on billionaire taxation, Sanders’ age, and whether or not Musk should sell more Tesla stock.
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The fiery volley certainly attracted a lot of commentators (even Michael Burry of Big short Fame joined the brawl). As a result, many investors became concerned about the impact this showdown would have on Tesla stock.
However, it’s not Tesla that investors should be watching out for right now. Instead, the argument between Sanders and Musk led to an unlikely discussion Bitcoin (CCC:BTC-USD) and the effects of inflation.
For savvy investors, this means that now could be the perfect time to buy BTC on the plunge.
From Tesla Stocks to Bitcoin Benefits
That exchange started with Sanders tweeting about one of his favorite things – billionaires paying more taxes. Musk, currently the richest person in the world, couldn’t resist beating up Sanders. Mockery he for his age. Musk then went on to ask Sanders if he should sell more Tesla shares after selling 10% of his shares after a sale Twitter poll. His followers voted for him to sell, and Musk did just that.
Sanders never replied to Musk’s question about selling Tesla stock, but neither did he. The Tesla CEO sold roughly $ 6.9 billion in shares last week and dumped an additional $ 930 million yesterday.
While the controversy resulting from Musk’s decision to sell stocks based on a social media survey last week caused TSLA to decline, Tesla stock has rebounded today and is currently up 3%. Some experts, like Burry, have recommended that Musk has other reasons for selling stocks, such as the need to pay off personal debts. More recently, Burry implies in a now-deleted tweet that it may be because he just wanted to sell TSLA.
But so far the conclusion is that Tesla stock will leave this saga relatively unscathed. Sure, a short-term decline in stocks sent the company’s market cap briefly below $ 1 trillion, but the TSLA bulls will continue to advance. Plus, the most recent debut of Rivian (NASDAQ:RIVN) has paid great attention to the world of electric vehicles.
So for investors, there’s a much more relevant topic that emerged from the Twitter spit. It appears that Sanders’ sacking of billionaires struck a nerve with many cryptocurrency supporters. Why? Bitcoin bulls see the leading cryptocurrency as a solution to inflation, a symptom of what they see as economic problems well beyond Musk’s wealth.
Take crypto influencer Natalie Brunell, for example, who has over 90,000 followers and interferes to suggest that Bitcoin is the solution.
Hey @BernieSanders, if the government didn’t steal from the middle class / poor for decades through inflation tax, you wouldn’t have to go after people like @elonmusk. You guys in DC create the problems and moral dangers, then blame others and falsely claim to be prophets. #Bitcoin
– Natalie ₿runell (@natbrunell) November 14, 2021
Cameron Winklevoss, founder of the Twins Exchange and one of the most powerful voices about Bitcoin, supported them.
Imagine a crypto where supply has increased fourfold without input from the community. It wouldn’t pass the shitcoin chuckle test. Now remember that I am actually describing the US dollar.
– Cameron Winklevoss (@cameron) November 14, 2021
Inflation catalyzes crypto investors
What does this all mean for investors?
The argument that Bitcoin is a hedge against inflation is certainly not new. In fact, it has fueled the spike in BTC largely to all-time highs through 2020 and this year. However, interest in BTC and other so-called inflation hedges has increased in recent weeks. That comes as Consumer prices jump at record highs and the Federal Reserve is preparing to begin tapering.
Backing this trend is the fact that the government pumped cash into the economy during the pandemic to keep things afloat. With a recovery on the horizon, fears of inflation – and consumer prices – mount. That’s why Bitcoin Magazine Jerry Goddard continues Proponents of Bitcoin as a portfolio-saving investment.
It is an asset that also helps investors distance themselves from a government that they may no longer be able to trust. With rising consumer prices, some critics even have called the Fed’s credibility in question.
The appeal of decentralization
It may seem ironic that Bitcoin ends up winning in a debate between a billionaire CEO and a politician over taxing the rich.
However, when we look at this in depth, it makes sense. Sanders uses his classic ideology that taxing billionaires will provide the money struggling Americans need when prices go up. Although unemployment recently due to Job growth Much of the country remains under a cloud of economic pessimism under President Joe Biden. And history has taught us how easy it is to blame politicians when voters are too pessimistic about the economy, as it has been recently Axios Podcast discussed.
Crypto supporters only see another solution. Instead of arguing about taxes, they support Bitcoin, which InvestorPlace employee Alex Sirois describes as the “counterpart” to the US dollar. It is potentially an inflation-resistant way to bypass the US economy and avoid the problems that fuel Musk’s debate with Sanders.
Although the Fed will begin to slow, many investors are preparing for continued inflation. As Musk and Sanders continue to discuss taxes, take a closer look at Bitcoin. Some analysts estimate it will climb to as high as $ 89,000 in the coming year, if not higher.
At the time of this writing, Samuel O’Brient held positions (neither directly nor indirectly) in the securities discussed in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s posting guidelines.