Will interest rate hikes and cuts reap the global economy?
1980: A 19% interest rate hike caused the Latin American economic crisis in 1982, and some small countries lost their sovereignty.
1989: A 9.5% interest rate hike caused the real estate bubble to burst, and the small life entered the "lost thirty years".
1995: The interest rate was raised to 5.5%, causing the Asian financial crisis in 1997.
From the beginning of masks in 2020 to 2023, the Federal Reserve has completed ten interest rate hikes, raising the interest rate to 5.5%.
After each interest rate hike, it is accompanied by an interest rate cut. So, why can interest rate hikes and interest rate cuts "harvest" the global economy?
After the interest rate cut, the US dollar will not generate profits in the Federal Reserve, and the funds will flow to the world, to other countries, to the stock market, the real estate market and other places that can generate profits, promoting and stimulating global economic prosperity, and the economic bubble will be blown up.
After the interest rate hike, the US dollar will flow back to the Federal Reserve from the world. Once the US dollar recedes, the stock market, the real estate market, the economy, etc. will begin to decline. The economic bubble was punctured, factories stopped working, workers lost their jobs, consumption power declined, a series of vicious reactions, and real estate prices fell.
When the tide receded, there were only rotten shrimps and rotten fish, and cheap assets were everywhere. Then they took a big net to buy these cheap high-quality assets. The US dollar chased profits, and its purpose was only one-profit!
Since World War II, since the US dollar dominated the global economy, it has been "harvesting" global wealth in cycles. When countries gradually wake up and hate the US dollar, can it still play? It will eventually fall from the altar!
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