Bank of America Survey: Most Fund Managers Say Bitcoin Is a Bubble, Inflation Is Transitory
The latest Bank of America’s Global Fund Manager Survey shows that “long bitcoin” is now the second most crowded trade. Moreover, most fund managers believe bitcoin is in a bubble and agree with the Fed that inflation is transitory.
Bank of America’s June Fund Manager Survey
Bank of America (BofA) released its June Global Fund Manager Survey this week. The survey, conducted between June 4-10, covers 224 fund managers with $667 billion under management.
The fund managers were asked about many issues of concern to investors, ranging from where the economy and markets are heading to how much cash portfolio managers are holding and which trades they see as most overdone.
“Long commodities” is now the most crowded trade, overtaking “long bitcoin” which is now the second most crowded trade. The third most crowded trade is “long tech stock,” followed by “long ESG,” “short U.S. Treasuries,” and “long euro.”
Despite the BTC price pullback, 81% of the fund managers surveyed still think that bitcoin is in a bubble. This is a slight increase from May when 75% of the fund managers surveyed said bitcoin was in a bubble zone. Bank of America itself has also warned about the cryptocurrency being in a bubble. The bank’s chief investment strategist said in January bitcoin was “the mother of all bubbles.”
Meanwhile, 72% of fund managers say that inflation is transitory, agreeing with what the Fed has been saying. However, 23% think inflation is permanent. Federal Reserve Chairman Jerome Powell has used the word “transitory” to describe the threat of inflation to the U.S. economy several times. Nonetheless, a number of people have indicated that they disagree with him, including famed hedge fund manager Paul Tudor Jones and JPMorgan CEO Jamie Dimon.