The Federal Reserve is now completely entangled in politics and has fundamentally changed. Former Treasury Secretary Summers revealed a significant tidbit: Why is Trump recently fiercely criticizing Federal Reserve Chairman Powell for 'not lowering interest rates'?
Actually, he is looking for a scapegoat in advance! In case the economy really falters, Trump can blame the Federal Reserve, saying they raised interest rates too aggressively and were too slow to lower them, with nothing to do with the president—this tactic is called 'moat strategy,' redirecting public anger towards the central bank while he stays far away.
Trump has used this tactic more than once. He criticized like this in 2018, and as a result, the Federal Reserve lowered interest rates in 2019. When the pandemic hit in 2020, they directly lowered rates to zero, which sparked a massive bull market in cryptocurrencies. Now he's back, with an even louder voice: If the economy is good, it’s my achievement; if the economy is bad, it’s all the Federal Reserve’s fault!
Summers also predicts that Trump will eventually nominate a 'seemingly reliable' person to replace Powell. But this is not a good thing: if the economy collapses, this new chairman will be the ready-made scapegoat; if the economy improves, all the credit will go to Trump for his 'effective leadership.' In short, the independence of the Federal Reserve is quickly being undermined by politics, and future policies will definitely oscillate—this kind of chaos is precisely a great opportunity for making money in the crypto space!
History has long proven: When politics interferes with the Federal Reserve, cryptocurrencies surge! In 2019, Trump pressured for rate cuts, and Bitcoin skyrocketed by 120% in six months;
In 2020, with zero interest rates and rampant money printing, it directly ignited a huge bull market in DeFi;
This year is an election year, with policy debates raging, and Bitcoin has already rebounded 60% from its low in January!
Why is this happening? Because when traditional finance is thrown into disarray by politics and policies change frequently, assets like Bitcoin, which are 'not afraid of intervention,' become highly sought after. Ironically, while Trump criticizes the Federal Reserve, he is quietly planning to accumulate Bitcoin and wants it to hold a status as high as gold—this is not opposition to the existing system; it clearly aims to use cryptocurrency to establish his own new rules!
In summary: Trump's blaming the Federal Reserve is fake, but his desire to seize control of finance is real. The more chaotic traditional finance becomes, the greater the opportunity for assets like Bitcoin. When interest rate cuts become a political tool, you will find that Bitcoin is the 'hard asset' that becomes more valuable the more it is tossed around.
