THE FIRST "FED DAY" UNDER KEVIN WARSH TURNED OUT TO BE THE WORST FOR THE MARKET SINCE 1994

Yesterday, June 17th, was a pivotal day — the Fed's rate decision, and Kevin Warsh stepped in as the new chair of the U.S. Federal Reserve.

The rate was left unchanged at 3.75%, and none of the 19 participants felt it was necessary to tighten the monetary policy today. Although Warsh made it clear — inflation is still above the target of 2%, and the Fed hasn't hit that target for 5 years now.

Also, Warsh declined to provide his own forecasts, removed the strict 'forward guidance', and is now launching working groups on communications, balance, data, employment, and inflation. Essentially, the Fed is opening a new chapter and preparing changes in its policy.

On the flip side, the vast majority of experts are pointing out that yesterday's first FOMC meeting led by Kevin Warsh was marked by a sharp downturn in the stock markets, making it the worst debut day for the new head of the regulator since 1994. Specifically, in light of Warsh's press conference, the S&P 500 index dropped 1.2%, while the Dow Jones plummeted by more than 500 points. BTC initially gave around -2%, then quickly bounced back, but now it’s starting to weaken again.

Moreover, there was a sharp increase in yields on the year-long treasuries following the first FOMC meeting. By the way, the rise in yields on 'buddies' to 4% with rates at 3.75% means only one thing - at one of the upcoming meetings in 2026, the Fed will raise rates, not lower them as was expected at the start of this year. This will immediately trigger a sell-off of risk assets (stocks, commodities, crypto, etc.).

Finally, I’d like to point out that the crypto market is still holding up fairly well (for now, while the US market is peaking), but a serious correction in the stock market will definitely lead to a significant sell-off in crypto.