At present, the core focus of the traditional financial market and the crypto market is on the United States. Not only are the institutions entangled, but the Federal Reserve is even more entangled.
How will the Federal Reserve cut interest rates? Will it expand its balance sheet? Will the economy decline? These major issues seem to have entered the realm of metaphysics. If the interest rate is cut, it may explode the "yen-dollar" arbitrage fund leverage, trigger a liquidity collapse, and then induce an asset price collapse; if the interest rate is not cut, with such high interest rates and debts, the economic pressure is increasing, and the possibility of an economic recession is increasing; if the Federal Reserve expands its balance sheet again to print money to supplement liquidity in the financial system, the pressure on the dollar to depreciate will increase, inflation will return, and the credit foundation of the dollar will be shaken, which will affect the core interests of the dollar. The uncertainty of the US economic recession has intensified, and the Federal Reserve needs to choose between "soft landing + dollar depreciation" and "strong dollar + hard landing". Both paths are very entangled. The former shakes the credit of the dollar, and the latter may induce a collapse! ! !
