Is the cryptocurrency world about to change in September? Interest rate cuts, bubbles, and Trump's interest rate calculations.
An interest rate cut in September is almost a certainty, with a probability exceeding 89%. The market has already taken this as a foregone conclusion. Trump has recently been meddling in the Federal Reserve's personnel arrangements, clearly wanting to control the direction of interest rates. After all, with the elections coming up this year, if he wants his family to comfortably hold the White House, he must keep interest rates around 1%. This intention is hardly hidden.
Recently, the market has undergone a thorough washout; those who should have exited have done so, while others have stayed. However, the cryptocurrency world may experience its biggest bubble before the end of the year. Currently, market analyses are sometimes saying a cut of 50 basis points and other times 65 basis points; these predictions are simply unreliable. Personally, I think there should be at least a 300 basis point cut, with a reasonable drop to 400 basis points by the end of the year. Those suggesting 50 or 65 basis points are just guessing.
Trump's calculations are quite loud; a rate cut can stimulate the economy, leading the stock market and the cryptocurrency world to rise. If voter sentiment improves, re-election will naturally be secure. But the cryptocurrency world shouldn't get too carried away; bubbles grow quickly but burst just as fast. Don't be misled by short-term emotions. A rate cut is a done deal, but the specific magnitude and pace will depend on how Trump operates the Federal Reserve.
Personally, I believe this round of interest rate cuts is driven by both political and economic factors. Trump will try his best to lower interest rates to secure re-election, and it's highly probable that the cryptocurrency world will rise as a result. However, don't forget the risk of bubbles. If you really want to play, focus on the rhythm after the interest rate cuts and don't be swayed by rumors of 50 or 65 basis points; starting from 300 basis points is the real deal.
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