Fed Hike Odds Fall to 15.5%: Where Is Money Going as Markets Fall? Bonds, stocks, Bitcoin and gold are selling off together. Where is money going, and what will the Fed’s Oct. 28 decision change? ━━ Why are markets falling? Nasdaq fell over 2% Friday; the S&P 500 and Nasdaq had their worst weeks since June. CoreWeave’s 50B $ debt raised concerns about debt-funded AI spending. The 10-year Treasury yield hit its highest since 2002, near 5.1%; the 30-year topped 5.4%. Bitcoin trades near 80,000–82,000 $. Gold fell from above 4,600 $ to 4,070 $, trying to hold 4,170–4,200 $. ━━ Fed outlook September CPI rose 3.7% y/y, lifting October hike odds to 40–50%. After Kevin Warsh stressed data dependence, odds for an Oct. 27–28 hike fell to 15–16%. December hike pricing remains near 90%: markets expect a later hike, not an end to tightening. ━━ Where is money going? 1. Short-term Treasuries and money-market funds offer attractive yields with less duration risk. 2. High U.S. rates support the dollar, pressuring gold and Bitcoin. 3. Energy benefits from oil near 105 $; the S&P 500 energy sector rose over 2.5% Friday. 4. Funds rotate from AI and chips into defensive sectors and banks. 5. Leverage unwinds pull money from markets. Margin calls force sales—even of gold—to cover losses; liquid assets like $BTC can be sold first. ━━ Fed scenarios A hike would lift the dollar and yields, pressuring stocks, gold and Bitcoin. A hawkish hold could keep risk appetite weak. A dovish tone could lower December hike odds and support gold and Bitcoin. ━━ Beyond the Fed Long-term yields reflect AI borrowing and U.S. federal debt above 40T $. Even if the Fed holds, long rates may stay high. Relief requires cooler inflation and lower energy prices. Bottom line: Money favors short-term bills, the dollar, energy and defensive shares, while long bonds, high-valuation tech, gold and Bitcoin remain pressured. The Fed’s December signal may matter more than Oct. 28. Not investment advice. $XRP