At a time when the global financial situation is volatile, the entire network is calling for a rate cut in September. However, Arthur firmly believes that the United States will not cut interest rates in September, and I have posted several articles in a row. Today I will analyze the reasons in depth!
Does the US really care about non-farm payrolls and inflation rates when it comes to whether or not to cut interest rates? No, what the US cares about is whether the bosses can make money. To be precise, the US is a country disguised as a capital consortium alliance.
Powell claimed that the timing and pace of rate cuts depend on the balance of data, outlook and risks, but our experts directly translated it into the strongest voice for rate cuts. However, the so-called "data, outlook and risks" are just a word game. Even they themselves have not determined the direction, but the whole world surprisingly unanimously said that interest rates will be cut in September. Why is this?
My fans are all smart and understand that war has a purpose. A rate cut means the end of the financial war, but if it is just for traffic, they will definitely say that the rate cut will definitely happen, easily overheat the charts, and the number of views will soar. They will not care about logic, but just publicize the expectation of rate cuts and encourage everyone to buy houses and assets quickly. But I want to say, who can be convinced by this? We should look at what the United States does, not what it says.
We all know the US's goal, which is to blow up China's economy and cut interest rates to fatten itself. But have they achieved their goal? Let's first see how much the US has paid for this, and then see whether they are willing to give up easily.
First, the United States hits our demand side. Many people may not understand the demand side, but everyone should be clear about domestic demand. To put it bluntly, the demand side is to make the entire Chinese mainland run out of liquidity, leaving everyone without money. How did the United States do it? Raising interest rates and messing up the global situation. In the American plan, raising interest rates can at least achieve four major goals.
First, it caused the global dollar to flow back, including a large amount of dollar funds in China returning to the United States, resulting in an extreme shortage of money in the Chinese market, sluggish real estate and stock markets, and everyone became poorer.
Second, Chinese real estate companies hold a large amount of US dollar bonds, with a scale of nearly 800 billion US dollars. The US interest rate hike means that their debt repayment costs will soar, their capital chain will be broken, and then our land finance will be hit through the real estate crash.
Third, exports are the second important source of China’s fiscal revenue. If the United States raises interest rates, all countries will become poorer and have no money to buy our goods, which will affect export data and fiscal revenue.
Fourth, the US interest rate hike is forcing us to raise interest rates as well. Countries around the world are following the US interest rate hike, because if interest rates are not raised, a large amount of domestic money will flee to the US. However, the disadvantages of raising interest rates are obvious, which will increase corporate financing costs and be detrimental to the development of the real economy.
The United States is well aware that if we follow suit and raise interest rates, the manufacturing industry will collapse; if we do not follow suit and instead flood the market with money, we will face imported inflation and soaring prices. In order to amplify the effect, the United States has been causing trouble around the world during the interest rate hike cycle, including in Russia, Ukraine, Israel, Palestine, Iran, North Korea, and the Taiwan Strait, forcing funds to flee to the United States and increasing its crackdown on us.
While attacking the demand side, the United States also attacks our supply side, using various methods to reduce the amount of goods we produce.
First, they frequently hype up China’s overcapacity and ask us to take the initiative to reduce production and control capacity.
Second, increase tariffs to prevent our new energy vehicles and other products from entering their market.
Third, it is strangling us in the high-tech field and bulk commodity raw materials, such as iron ore and chips, leaving us short of parts and raw materials.
Fourth, we will support countries such as Mexico, Vietnam, and India in transferring their manufacturing industries so that they can replace our position as the world’s largest industrial producer.
Fifth, raising interest rates will make countries around the world poorer and unable to afford our products, so we will naturally reduce production.
Through these five consecutive tactics, Chinese foreign trade companies have been unable to receive orders, factories have laid off employees or even closed down, a wave of unemployment has occurred in the country, further amplifying the sluggish domestic demand.
Finally, the United States attacks our exchange rate and foreign exchange reserves. Why does it attack the exchange rate? Because once the country's exchange rate collapses, it is a necessary condition for the United States to acquire it. If the United States wants to reap our wealth, it must first collapse our exchange rate before it has room for maneuver. This is why the United States has frequently attacked our stock market in the past two years and has been singing the bad news about the Chinese economy everywhere, just to make the outside world lose confidence in us and cause the RMB to depreciate rapidly.
The three major strategic goals of the United States have been basically made clear. So has the United States achieved these goals? As long as we understand this, we will know whether the Americans are throwing smoke bombs or will really cut interest rates. There is a reason why the United States deceives itself. It underestimates our market and determination. The United States will eventually fail in the transformation of new energy, the 1.8 billion mu of arable land red line, the full-chain industrial system, and the new settlement system that is de-dollarized.
It is not the right time to cut interest rates now. First, the US election is imminent and the new government needs bargaining chips. Second, the interest rate cut is the trump card of the US. Once it starts, it will be impossible to return to the interest rate hike cycle in a short period of time. Only after the opponent has played all the cards can the final decision be made. Although all countries are in a difficult situation at present, they have survived under the pressure of the Fed's interest rate hike, and everyone has not played all the cards in their hands. In this case, the US directly cutting interest rates is equivalent to destroying its own martial arts and losing the initiative.
So I firmly believe that the United States will not cut interest rates in September, and the forecast time is January 2025. Let's talk about the impact of interest rate cuts on our country. Now everyone is uncomfortable because the United States has raised interest rates, domestic funds have been sucked into the United States, and we are facing deflation. The central bank is desperately cutting interest rates because it is worried that the domestic economy will not be able to make up for it. If the United States starts to cut interest rates, it will reverse market expectations and ease deflation, but don't be too optimistic. Just like there is a severe cold season after the winter solstice, the economy may only pick up after turbulent adjustments. It is particularly important to prepare food for the winter.
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