🤔 Arthur Hayes argues that at a high level of public debt, raising interest rates can have a stimulating effect.
“Banks earn more income from their reserves, and holders of U.S. Treasury bills receive increased payouts. As a result, there is a general increase in consumption, especially in the area of financial assets.
Despite the fact that the Federal Reserve stopped purchasing RMP in mid-August, the total amount of assets at the Fed and banks continues to grow due to higher bank balances, which leads to the creation of new money.
Thus, even with increased costs, the total amount of money increases. This explains why financial assets will continue to grow,”
— Arthur Hayes noted.
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“Banks earn more income from their reserves, and holders of U.S. Treasury bills receive increased payouts. As a result, there is a general increase in consumption, especially in the area of financial assets.
Despite the fact that the Federal Reserve stopped purchasing RMP in mid-August, the total amount of assets at the Fed and banks continues to grow due to higher bank balances, which leads to the creation of new money.
Thus, even with increased costs, the total amount of money increases. This explains why financial assets will continue to grow,”
— Arthur Hayes noted.
$ETH
$SOL
$USDC
