Assuming that the bond market is usually wrong in the short term in its forecast regarding the interest rate development of the central banks, we could theoretically assume that this will also be the case this time and that the Fed may even raise interest rates against all expectations in response to the rising inflation rates. This would kill two birds with one stone: it would put a spoke in the wheel of the excessive debt policy from Washington and at the same time massively shock its biggest opponent, the European Central Bank. All we hear these days from the ECB Tower in Frankfurt is whimpering begging for interest rates to be lowered soon. The eurozone is in a deep recession, and if we look at China's massive expansionary monetary policy, this would also be a blow to China as a business location.
91 sats \ 5 replies \ @siggy47 16 Mar
Powell would be destroyed by the liberal press for hurting Biden's reelection chances. It would be fun to watch.
reply
76 sats \ 3 replies \ @Bell_curve 16 Mar
Which is why it won’t happen
The Federal Reserve is supposed to leave interest rates unchanged during an election year.
Powell created a loophole in December by saying we expect 6 rate reductions in 2024.
Until “inflation” hits 2 percent, Powell cannot lower rates.
He will only increase rates if he is feeling “suicidal”
reply
10 sats \ 2 replies \ @siggy47 16 Mar
I agree with half of what you said. No way he raises rates before the election. However, I can see him making the case that 2 1/2 or 2 3/4% inflation is close enough for a rate cut. The media will give him cover.
reply
97 sats \ 1 reply \ @Bell_curve 16 Mar
That’s true
The media is already questioning the 2 percent target.
https://time.com/6548908/inflation-target-federal-reserve-essay/
reply
0 sats \ 0 replies \ @TomK OP 16 Mar
Yep. Need to readjust now
reply
76 sats \ 0 replies \ @TomK OP 16 Mar
Perfect clown show... and we are watching this off distance.
reply
71 sats \ 1 reply \ @Coinsreporter 16 Mar
I Don't think Fed will do it. However if that's done, it will most likely put the brakes on Bitcoin Rally as well.
reply
51 sats \ 0 replies \ @TomK OP 16 Mar
yes, but i don't think it can boldly slow down global liquidity enough to disrupt the bitcoin rally. besides, it seems like bitcoin is kind of an asset for america, built up via ETFs etc maybe they have themselves on the balance sheet?
reply
10 sats \ 0 replies \ @Wumbo 16 Mar
One could only hope but I am not sure an increase interest payment on the US national debt will affect spending.
reply
31 sats \ 0 replies \ @orange_crush 16 Mar
Rarely can you 'win' in economies. This is because the underlying principle of cooperation is so important to outcome. If the US is too successful while our developed nation partners and enemies are desperately flailing, then other nations may blame us and look for new global solutions for leadership. And judging by Europe's need to over manage, this won't be bitcoin.
Good thing we are so proficient in stirring up conflicts to keep everyone dependent on our defense capabilities.
Anyway two things are known:
US deficit spending will continue
US military power will continue
Just siphon off what you can with speculative attacks on the dollar while we drive this cruise ship called America right off the edge of the world. We'll need resources to build the new world.
reply