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BlockBeats, July 14: Fed Governor Waller said that if an artificial intelligence (AI)-related asset bubble bursts or the market experiences a sharp pullback, the financial environment will undergo “a rather significant change.”
Waller said he does not want the Federal Reserve to raise rates too early in order to avoid triggering an economic recession, but he also stressed that it must not repeat the mistake made in 2021—when the response to inflation was slow. He believes that the current job market remains stable, and that there is “a credible reason” to think inflation can continue to fall without further tightening of policy.
However, Waller warned that relying only on the market’s expectations of falling inflation is not enough to support the Federal Reserve continuing to hold back. If the Fed waits until market confidence fades before taking action, it may have to raise interest rates more aggressively to catch up with inflation. “We cannot tolerate ignoring inflation until it disappears entirely,” he said.

BlockBeats news: On July 14, Japanese investment bank Mizuho said that although Circle’s receipt of final approval from the U.S. Office of the Comptroller of the Currency (OCC) to establish the First National Digital Currency Bank is a positive step, it does not sufficiently address the company’s core challenges it currently faces.
Mizuho maintains a “neutral” rating on Circle, believing the market’s reaction to this positive development may be overly optimistic. The firm noted that since March of this year, the circulating market value of USDC has declined by about $7 billion to around $74 billion, indicating that its growth momentum is slowing and could weigh on Circle’s trading revenue and reserve income.

BlockBeats message: On July 14, Federal Reserve Governor Waller said on Monday that if future data shows inflation remains far above the 2% target, the Fed “in the short term” may need to raise interest rates. He said current monetary policy is at a “crossroads.”
Waller said this direction will be determined by new information such as the CPI report to be released on Tuesday. If the data trend turns unfavorable, the Fed is currently in a stage where it should not “be complacent.”
Waller said: “At the current level of policy, inflation could gradually fall to the 2% target. But I’m also concerned that another similar situation could occur—namely, that data over the next few weeks will show inflation remains at a high level, or even continues to rise. That would call for tighter monetary policy in the short term.”

BlockBeats News: On July 14, Federal Reserve Governor Waller said that if the core inflation data released this week again remains at a high level, the Federal Reserve would need to consider raising interest rates in the near term.
Waller said that the recent rise in core inflation has made him concerned. Tariffs, higher energy prices, and increased demand for investments in artificial intelligence are the main factors driving inflation higher. He expects overall inflation to slow starting this week, but core inflation will remain the key indicator to watch.
However, Waller also noted that if core inflation continues to fall, keeping interest rates unchanged remains a reasonable choice. He reiterated that the Federal Reserve is committed to bringing the inflation rate back to its 2% target while avoiding overly tight policy that could lead to an economic recession.

BlockBeats message: On July 14, influenced by the continued decline in SpaceX’s share price, Musk’s net worth fell below the $900 billion mark on Monday. SpaceX shares fell 3.8% on Monday to nearly $140, approaching its IPO offering price of $135. Tesla’s share price fell 3% during the same period. This round of pullback caused Musk’s net worth to evaporate by $37.9 billion, bringing his latest net worth to $879.3 billion.
Despite the shrinkage of his fortune, Musk remains the world’s richest person, ahead of Google co-founders Larry Page ($290.1 billion) and Sergey Brin ($267.6 billion). Musk holds 4.8 billion shares of SpaceX and 350 million stock options, and also owns about 700 million shares of Tesla.

BlockBeats message: On July 14, multiple market analysts believe that Bitcoin’s panic selloff, which has persisted for months, may be nearing its end, and marginal selling pressure is gradually drying up.
Wintermute over-the-counter trader Jasper De Maere said that although tensions have escalated in the US-Iran conflict and the situation in the Strait of Hormuz remains tense, Bitcoin is still holding above $62,000, indicating that the earlier selling pressure from “weak hands” has largely been cleared. In addition, US spot Bitcoin ETFs recorded a net inflow of $197.4 million last week, ending the prior streak of eight consecutive weeks of net outflows, which further reflects that selling pressure is weakening.