The Economic Strategy Behind Currency Games: The Fluctuations of the US Stock Market Affect Global Market Nerves
Currently, the US capital market is experiencing a thrilling game of monetary policy. In the face of the Federal Reserve's determination to maintain high interest rates, the White House's economic strategy reveals unprecedented contradictions—whether to tolerate short-term fluctuations in the capital market in exchange for long-term policy space has become
a key proposition testing the wisdom of decision-makers.
From the perspective of macroeconomic regulation logic, the Federal Reserve's confidence in maintaining high benchmark interest rates stems from robust employment data and unmet inflation control targets. However, the current government evidently pays more attention to the financing cost pressures of the real economy, especially under the dual demands of manufacturing return and debt expansion, lowering the cost of capital has become an urgent task. This policy demand division is reminiscent of the balance problem between "ensuring growth" and "preventing risk" in China's macroeconomic regulation.
It is noteworthy that the special attributes within the US economic structure are amplifying the impact of market volatility. Statistics show that over 60% of ordinary households' wealth is deeply tied to the securities market; this asset allocation characteristic is similar to the concentration of wealth among residents in real estate in our country. Just as the cyclical adjustment of the real estate market can significantly affect consumer confidence, the sharp fluctuations in the US stock market may similarly transmit to the real economy through the wealth effect.
From a strategic game perspective, decision-makers may have policy considerations of "retreating to advance." By allowing the market to moderate its adjustment, it can relieve inflation pressure to create space for monetary policy while also forcing capital to flow towards the real industry. This strategy is akin to the "pain therapy" in China's supply-side reform, exchanging short-term costs for long-term structural adjustment space. However, practical operation requires precise control of market expectations to avoid triggering systemic risks.
The current situation subtly echoes the policy dilemma before the 2008 financial crisis. The lessons of Greenspan maintaining low interest rates for an extended period, which led to asset bubbles, are still fresh in memory, while current policymakers must guard against the risk of economic overheating and address the challenges of industrial restructuring amid globalization's retreat. This dilemma is a true reflection of the complexity of contemporary macroeconomic governance.
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