Tonight in Beijing time (at 2:00 a.m. on September 17), the Federal Reserve will release its interest rate decision and the latest economic projections. CME data shows that the probability of a 25-basis-point hike is as high as 92.4%, while the probability of holding rates unchanged has fallen to just 7.6%. In addition, for October, the probability of a cumulative 25-basis-point hike is 52%, the probability of a 50-basis-point hike is 44%, and the probability of staying on hold has already dropped to 4%.

However, judging from the overall performance of U.S. stocks, gold, and the index that is rising today since last night, even though market expectations suggest the probability of a 25-basis-point hike is close to a sure thing, the impact on financial markets is not that significant. How should we interpret the reasons behind this? Then let Lu Ge share his personal view;

On the 16th, the market already showed something: it had anticipated that the Fed wouldn’t raise rates, or even if the Fed raised rates by 25 basis points, the market would treat it as “bad news already priced in,” and therefore as “good news.” The rise in technology and non-ferrous metals is itself a game played around the Fed’s policy decision results in the early hours. Many friends may not understand this, so let me explain it: it’s very simple. The spread of information follows social strata, not national borders. It’s not that Americans learn the news first and other countries learn later—the people in the same social tier across the world learn first, and information circulates within their circles. That’s why I’ve been saying all along: reduce the noise. Some information is actually spread with very strong purpose. It’s not convenient to go any deeper into this topic.

From a macro perspective, at present, the global tech sector is still in a relatively loose environment and a stage of creating/producing bubbles. Whether it’s the U.S. AI or China’s tech sector—for example, in A-shares, two giant companies are still slated to be listed: one is DeepSeek, and the other is Yangtze Memory.

The U.S. Treasury doesn’t really want to suppress inflation either. If it truly wanted to, it would be easy: raise rates by 50 basis points and inflation would come down very quickly. But during Powell’s term, they didn’t do that. Switching to Waller in the short term also won’t—people can look up Waller’s specific speeches. Inflation expectations are essentially to buy time for building the U.S.’s AI infrastructure. And once the AI infrastructure is nearing completion, rest assured, the speed of U.S. rate hikes and monetary tightening will be very fast.

There’s also a factor related to Trump’s midterm election. Even though the Federal Reserve needs to maintain “independence,” raising rates and tightening monetary policy run counter to the basic interests of the United States.

About cryptocurrencies:

Longtime followers of Lu Ge should know that, personally, I previously believed the bottom of the big cake would be around 48,000. But facts have shown that the market’s bottom was already reached and finished around 57,700. The market makers don’t necessarily want to keep smashing lower, but it’s difficult to drive it to an even lower level this year given the broader environment. For middle-class investors, nearly all their chips have basically been wiped out in this bear market. For the upper tier, it’s even harder—so they need to wait for the next tightening cycle.

As this round of the easing cycle continues, and as prices keep rising on the consumer side, the crypto market is highly likely to start a new upward trend after this rate decision ends. It’s highly likely to return to above 100,000 again. This may become the last opportunity before the bubble bursts.

Every friend who follows, likes, and shares—I’ll remember you, Lu Ge.

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This material is for learning and reference only and does not constitute investment advice. Trade at your own risk—consequences are your responsibility! $BTC $ETH