The hot topic recently is the Federal Reserve's 50 basis point rate cut

Good evening everyone, I am your old friend Jin Caishen Ding Qiankun

Question 1: Does the US interest rate cut mean surrender and failure of the financial war?

A: No. Many people mistakenly believe that the Fed's rate cut is a "surrender" to China, but in fact, the Fed's decision is more based on its own economic situation, such as inflation and employment rate. The rate cut is not necessarily aimed at a certain country, but is a means of economic regulation. Just like we don't think Australia is fighting a "battery war" just because electric vehicle lithium battery raw materials rely on Australia.

Question 2: Why did the Fed directly cut the interest rate by 50 basis points instead of 25 basis points?

A: The Fed chose to cut the interest rate by 50 basis points mainly because it meets market expectations and can stabilize market sentiment. Cutting the interest rate too little may cause dissatisfaction, while cutting the interest rate too much may exacerbate market volatility. The Fed is very good at "expectation management" and they hope that the market will have a smooth transition.

Question 3: Does the Fed’s interest rate cut mean that the US economy is in recession?

A: Not necessarily. The Fed's rate cut does not necessarily mean a recession. Powell himself has denied this. Whether there will be a recession depends on the economic data in the next few months. At present, we have not seen clear signs of a recession.

Question 4: Will the Federal Reserve continue to cut interest rates?

A: Not necessarily. The Fed's decision-making is flexible and it will not simply enter a cycle of continuous interest rate cuts because of a single rate cut. The future direction of interest rates depends on economic data and market reactions.

Question 5: After the US interest rate cut, will China’s stock market and real estate usher in a bull market?

A: Not necessarily. Although interest rate cuts may bring back funds, the funds will not necessarily flow directly into the stock market and real estate. Investors will decide where the funds will flow based on their own risk preferences and investment strategies. Moreover, China's real estate issues are complex and may not attract a large amount of foreign investment quickly.

Question 6: Why didn’t the cryptocurrency market see a big bull market after the U.S. cut interest rates?

A: The rise and fall of the cryptocurrency market is affected by many factors, and interest rate cuts are just one of them. Moreover, unlike the 2020 round of interest rate cuts, this round of interest rate cuts is unlikely to directly trigger a large-scale bull market. Refer to yesterday's daily analysis. Investors should remain patient and focus on long-term trends rather than short-term fluctuations.

Summarize

The Fed's interest rate cut decision is a complex economic process affected by many factors. We should not simply interpret it as "surrender" to a certain country or "financial war failure". For investors, it is important to pay attention to market dynamics and grasp long-term trends, rather than blindly follow the trend or listen to rumors. In the investment process, it is crucial to remain rational and patient. #美联储宣布降息50个基点 #BTC #加密市场反弹