The author of The Big Short (Michael Lewis) advises investors not to overreact to current events. Historical data shows the U.S. stock market typically recovers quickly and trends upward, even during wartime.
Most countries have annual defense budgets covering routine costs like salaries, equipment, training, maintenance, and operations—but not full-scale, prolonged wars. Serious conflicts often exceed these budgets, forcing governments (especially in the U.S., via Congressional approval) to ramp up spending.
This extra funding usually comes from borrowing (issuing bonds) or, if borrowing becomes too expensive, increasing the money supply. Raising taxes is politically unpopular and rarely the primary choice.
Ultimately, this can fuel higher inflation, which tends to drive asset prices upward over time —including $BTC , often viewed as "digital gold" due to its fixed supply of 21 million coins, making it a potential hedge against fiat currency debasement and government-driven inflation from such spending surges
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