On September 26, BitMEX co-founder Arthur Hayes posted on social media that based on the Federal Reserve's historic response to "high volatility", we know that once they start cutting interest rates, they will usually continue to cut until interest rates are close to 0%. In addition, we also understand that the growth of bank credit must be accompanied by accelerated interest rate cuts. The Federal Reserve will continue to cut interest rates, and the banking system will continue to release more dollars. No matter who wins the US presidential election, the government will continue to borrow to gain public support. Economic difficulties will be addressed through lower euro interest rates set by the European Central Bank. At the same time, governments will begin to force banks to lend more to local businesses in order to provide jobs and rebuild crumbling infrastructure.
As the Fed cuts rates and U.S. banks extend more credit, the dollar will weaken. This provides an opportunity for the Chinese government to increase credit growth while keeping the yuan stable against the dollar. If the Fed prints money, the People's Bank of China can do the same. This week, the PBOC announced a series of rate cuts throughout the Chinese financial system. This is just the beginning, and the real "killer weapon" will come when banks extend more credit. If other major economies are easing monetary policy now, there will be less pressure on the Bank of Japan to raise interest rates quickly.
Once again, major global economies are suppressing volatility in their countries or economies by reducing the cost of capital and increasing the supply of capital. If you are already cross margin invested in cryptocurrencies, relax and watch the fiat value of your portfolio soar. If you still have some fiat funds, hurry up and enter the crypto market.
