Source: Talking about Li and other things
Although we have written a lot about market conditions and Bitcoin topics and opinions in recent days, we can still continue to see some interesting comments in the background. Here I select two more representative categories:
- Following a public account to read your articles is giving you face, but the articles even have WeChat beans set up?
- I often see news reports about many people’s Bitcoin positions being liquidated. Bitcoin is a virtual currency, just like the tulip bubble. Are all the people in your circle gamblers?
Because both types of questions seem interesting, I will briefly answer them publicly here:
First, let’s talk about the issue of WeChat Beans.
I can only say that regarding face, I don't know you, is your face important? And to be honest, if you are not strong enough, then no one in this world will care about your so-called face.
Besides, Hualihuawai has already published 519 articles through the official account, which are all open and free. In addition, we also have a WeChat Beans column, which has only 5 articles so far, and based on some special considerations, we have only set a symbolic redemption threshold of 2.1 yuan (21 WeChat Beans). As shown in the figure below. If you have successfully obtained 519 articles from others for free, but you feel dissatisfied because of 5 articles and think that you can't save face, then please save your face and unsubscribe as soon as possible. It may be a good thing for you.
The second issue is regarding Bitcoin.
In fact, there are gamblers in any field, it’s just a matter of how many there are. Of course, you can think that everyone except yourself is a gambler, and this is your freedom. Regarding Bitcoin, if you think that Bitcoin is just a virtual currency, and in your eyes it may just be a very expensive "WeChat Beans", then I will not oppose your view, because everyone has the right to maintain their own views and opinions. Of course, you can also think that Bitcoin is a tulip bubble, and we will not refute you on these.
For those who still have such thoughts or views, our suggestions are:
- It doesn’t matter what opinions you have. You can share your opinions freely within the scope permitted by law, but don’t use your opinions to challenge others.
- Block all news or information related to Bitcoin and try to avoid them as much as possible.
Often, people tend to be dissatisfied with something, but in the final analysis, it may be more because of their own mistakes or failure to become a vested interest. For example, if you spent $1,000 to buy 100 bitcoins in 2012 and successfully got them until now, I guess now that you look at the $10 million in your account, you will no longer say that Bitcoin is a tulip scam.
Having discussed the two interesting questions above, let’s briefly discuss the topic of Bitcoin.
If we look at the time dimension in a longer time, we can clearly see that from January 2023 to now, Bitcoin is generally in an upward trend. As shown in the figure below.
Or it is no exaggeration to say that if you buy Bitcoin with your eyes closed at any time between January 2023 and October 2024, and if you ignore the fluctuations in the middle and can successfully get it to November 2024, then from the perspective of overall profit, you will not lose money.
But the reality is that over the past two years or so, we have always seen people giving various reasons for whether to buy or sell, and many people always hope that they can always buy at the lowest point and sell at the highest point, hoping that they can accumulate wealth in a very short period of time. In the end, after all the trouble, they found that not only did they not make money, but some people even lost some of their principal.
In fact, since Bitcoin passed the spot ETF at the beginning of this year, although Bitcoin is still experiencing a considerable level of price volatility, compared with the previous bull market cycle, this cycle has begun to become relatively low from a risk perspective. We can also assume that starting from this cycle, Bitcoin will officially enter a "low-risk" asset cycle.
In addition, if we simply compare it with the historical development of gold, we can even think that BTC ETF is the most successful financial product in history.
As for some people who still think that Bitcoin is a tulip bubble or a Ponzi scheme, we can only say that you might as well just say that the US government is a scam, because the approval of an ETF requires government approval. Since the BTC ETF can be approved by the US government, isn’t that equivalent to the US government allowing a tulip scam or a Ponzi scheme?
Obviously, so far, this view seems to be untenable, and it is more of a "revenge" psychological rhetoric of those who missed the opportunity. Or let's put it in a simpler way. Have you ever seen the tulip bubble that lasted for 15 years (the Bitcoin white paper was released on October 31, 2008, and then Satoshi Nakamoto mined the first Bitcoin block on January 3, 2009)?
Here is another interesting data. According to the statistics of 99bitcoins website, Bitcoin has been declared dead 477 times in the past ten years. As shown in the figure below.
But this so-called "death report" and tulip bubble rhetoric did not prevent the price of Bitcoin from rising more than 1.52 million times. As shown in the figure below.
At the same time, don’t forget that it has been less than a year since the BTC ETF was officially approved, and with the further adoption of institutions in the future (it is not ruled out that some countries/regions will include BTC in strategic reserves), Bitcoin has just entered a "new stage" of development. If you ignored 1 Bitcoin in the past, and you feel that you can’t afford 1 Bitcoin today, then you can only look far away from 1 Bitcoin in the future.
Of course, the future seems bright, but the process is often tortuous, and from a longer time dimension, we may continue to experience new cycles (bull market, bear market) one after another.
Let’s not talk about the distant future, let’s talk about next year:
Many people seem to be full of expectations for the coming 2025, expecting Bitcoin to set new highs in 2025, and expecting a full-scale altcoin season to break out in 2025... In the previous market topic articles of Hualihuawai, we talked more about some macro factors that may be beneficial to the market next year. Next, let’s continue to talk about possible macroeconomic risks next year. After all, opportunities and risks coexist.
1. The Fed’s pace of rate cuts may slow
Regarding the expectation of the Federal Reserve's interest rate cut next year, we have actually already sorted it out in the articles a few days ago. At the interest rate meeting that ended last week (December 19, Beijing time), the Federal Reserve announced that it would lower the target range of the federal funds rate by 25 basis points to between 4.25% and 4.50%, and it is expected that the interest rate cut in 2025 may narrow to 50 basis points.
The news also directly led to a rapid decline in the market (including the US stock market and the crypto market). As of now, more and more people have taken the Fed's interest rate cut expectations as one of the important factors to measure market trends, and the Fed's slowing pace of interest rate cuts is definitely not good news for the market.
2. The tariff war may continue after Trump takes office
Recently, we have seen some signs through some media reports. For example, the United States may even impose a 100% tariff on BRICS countries next year. Once the trade war starts again, it will definitely have a certain impact on GDP products, and thus hinder economic development to a certain extent. As shown in the figure below.
3. NVDA's earnings could fall short of expectations
NVDA is an important representative of US technology stocks. According to data, last year alone, they contributed a return rate of 20% to the S&P 500 index. After they announced their third financial report last month (November 20), although the data still exceeded expectations (third-quarter revenue was US$35.1 billion, higher than the market analysts' general expectation of US$33.2 billion. Net profit was US$19.31 billion, higher than the market expectation of US$17.45 billion), the market's response did not seem to be strong.
According to this trend, the market seems to have higher expectations for NVDA, which will undoubtedly increase the volatility of the market next year.
4. Inflation in the U.S. remains a major problem
According to the current development situation, the United States should further increase or stimulate economic development after Trump officially takes office next year, such as resuming growth in the manufacturing industry and boosting the development of the oil and gas industry. According to some economists' forecasts, the US GDP growth will remain at around 3.0% and may accelerate in 2025.
But this growth rate will theoretically occur when inflation starts to rebound and monetary policy is relaxed. In other words, inflation is still a major problem that the United States (and the world) will face next year, and this problem seems to become more and more obvious. At the same time, the inflation problem, in turn, further affects the Fed's interest rate hike/cut policy mentioned above.
5. U.S. 10-year Treasury yields continue to rise
By the way, I would like to mention domestic financial products. I wonder if you have noticed that the yields of some domestic financial products (low-risk) have started to increase recently. Many products that previously had an annualized rate of return of only about 2% have risen to 3% or even higher. A long-term financial product I bought from a certain bank has recently soared to more than 4%. I haven't seen a "low-risk" financial product starting with 4 for a long time. As shown in the figure below.
This is probably mainly because the rise in treasury bonds has driven the rise in low-risk financial products. After all, many low-risk financial products are mainly invested in various debt assets. As for the reasons for the rise in treasury bonds, there are roughly two reasons. First, there is news that the policy interest rate is expected to be lowered by 40-50bp next year. Second, based on the current situation of our A-shares, it is estimated that a lot of funds will return to the bond market for risk aversion. Under the dual influence, it directly drives the rise of the bond market. From the current situation, as long as the A-shares do not have a big bull market like a few months ago (September) (although it is very short), it will naturally be good for the bond market. As shown in the figure below.
As for the relationship between the yield of government bonds and the rise and fall of financial products, we actually wrote a special article earlier (2022). Interested friends can search for historical articles to review. However, the performance of government bonds is only one aspect. In addition, the main problem for us next year is still the problem of possible deflation, but the topic in China is more sensitive, so we will not discuss it too much here. Let's continue to talk about the United States.
Since the Fed’s policy shift this month, the US 10-year Treasury yield has continued to rise. According to the current trend, it may reach 5% in the second quarter of next year, which is bearish for the market. As shown in the figure below.
Of course, the five aspects we listed above are more macro-influencing factors. After adding various other factors and news, we can only say that 2025 is a year full of opportunities, but also accompanied by greater market volatility risks. In general, remember the sentence in our previous article: strictly manage your positions, it is more important to live longer than to live well in the short term, and investment is a long-term and comprehensive practice.