Deutsche Bank conducted a survey on financial bubbles. 89 percent of respondents see some bubbles in the financial markets with Bitcoin near the “extreme bubble” area. However, more respondents expect the cryptocurrency to double than Tesla’s stocks.
Deutsche Bank Bubble Survey
In a survey published Tuesday by Deutsche Bank, 627 market professionals were asked to rate how they view financial bubbles in a range of assets on a scale of zero to ten. According to CNBC, the poll was conducted between January 13th and 15th. The bank found that 89% of respondents are seeing some bubbles in financial markets right now.
According to respondents, Bitcoin is the closest to the “extreme bubble” area, followed by US tech stocks and European government bonds. Additionally, they see fewer bubbles in European stocks, Asian stocks, and US non-tech stocks.
Deutsche Bank survey results show how respondents see bubbles in different types of assets. Source: Deutsche Bank.
Bitcoin price has increased 66% since early December and 9% since the start of the year. Bitcoin’s price hit an all-time high above $ 41,000 on January 8th. It has since pulled back and is trading at $ 32,475 at the time of writing based on data from Markets.Bitcoin.com.
Deutsche Bank’s survey also compares Bitcoin to Tesla’s shares, which have also seen tremendous gains in recent months. Tesla’s stock is up 44.5% since early December and nearly 16% since early January. Deutsche Bank strategist Jim Reid, along with research analysts Karthik Nagalingam and Henry Allen, said:
When asked about the 12-month fate of Bitcoin and Tesla – a symbol of a potential tech bubble – the majority of readers assume they will halve rather than double from these levels, with Tesla being more vulnerable according to readers.
However, when comparing Tesla stock to Bitcoin, more respondents believe that Bitcoin is more likely to double than Tesla and less to halve.
Chart comparing Bitcoin to Tesla’s shares in Deutsche Bank’s survey. Source: Deutsche Bank
In the Deutsche Bank survey, respondents were also asked whether the Federal Reserve is curtailing its asset purchase program as a potential contributing factor to the bubble explosion. “71% of the respondents do not believe that the Fed will rejuvenate before the end of the year, which corresponds to the statements of the Fed governors until the end of last week,” said analysts at Deutsche Bank. They noted that “a quarter of readers might think that economic growth / markets may be forcing their hand”.
What do you think of the results of Deutsche Bank? Let us know in the comments below.
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