🔍 My Theory on Why Fed Rate Cuts Aren’t Going to Plan 💡
- 📉 $BTC Down 10% since JAYPOW announced the September rate cut at Jackson Hole. Aren’t rate cuts supposed to be good for risk assets?
- 💵 RRP Pays 5.3%: No T-bill under 1-year maturity offers a higher rate, pushing money from T-bills to RRP—a liquidity negative for markets.
- 📊 RRP Up $120B Since J-Hole: As long as T-bill rates stay below RRP, we can expect this trend to continue.
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I’ll dive deeper into the implications of Fed rate cuts and more thoughts on this at my KBW keynote tomorrow. Stay tuned! 🎤📈 #FedRateDecisions #ratecuts #liquidity