$BTC
KEVIN WARSH IS HEADING INTO FOMC AT THE WORST POSSIBLE TIME.
The FOMC meeting is happening on Wednesday, and the Fed could trigger a massive market selloff regardless of what it says.
Both CPI and PPI have come in hotter than expected, while core inflation is also rising.
The U.S.-Iran war is pushing energy prices higher, adding even more pressure to inflation.
Meanwhile, the U.S. economy is showing signs of weakness.
The housing market is struggling, borrowing costs remain painfully high, and companies are cutting jobs.
The Fed now faces two major problems: rising inflation and a weakening economy.
And neither option looks good.
If the Fed stays too relaxed about inflation, bond yields could rise as investors worry that inflation is getting out of control.
If the Fed turns hawkish, stocks and crypto could sell off as markets price in higher interest rates and tighter financial conditions.
If the Fed signals rate cuts, investors could question why it's easing policy when inflation is still rising.
The Fed needs inflation to cool without causing more damage to the economy.
But right now, inflation is moving higher while economic conditions are getting weaker.
That's what stagflation is, and it's the worst possible outcome for an economy.
A single hawkish comment could send stocks lower, while a dovish surprise could create fresh concerns about inflation and send bond yields soaring.
So if the Fed fails to restore confidence, this meeting could become one of the most volatile and disastrous for the global markets.#crypto #CryptoNews
KEVIN WARSH IS HEADING INTO FOMC AT THE WORST POSSIBLE TIME.
The FOMC meeting is happening on Wednesday, and the Fed could trigger a massive market selloff regardless of what it says.
Both CPI and PPI have come in hotter than expected, while core inflation is also rising.
The U.S.-Iran war is pushing energy prices higher, adding even more pressure to inflation.
Meanwhile, the U.S. economy is showing signs of weakness.
The housing market is struggling, borrowing costs remain painfully high, and companies are cutting jobs.
The Fed now faces two major problems: rising inflation and a weakening economy.
And neither option looks good.
If the Fed stays too relaxed about inflation, bond yields could rise as investors worry that inflation is getting out of control.
If the Fed turns hawkish, stocks and crypto could sell off as markets price in higher interest rates and tighter financial conditions.
If the Fed signals rate cuts, investors could question why it's easing policy when inflation is still rising.
The Fed needs inflation to cool without causing more damage to the economy.
But right now, inflation is moving higher while economic conditions are getting weaker.
That's what stagflation is, and it's the worst possible outcome for an economy.
A single hawkish comment could send stocks lower, while a dovish surprise could create fresh concerns about inflation and send bond yields soaring.
So if the Fed fails to restore confidence, this meeting could become one of the most volatile and disastrous for the global markets.#crypto #CryptoNews
