On March 10, 2025, the Nasdaq plunged nearly 5%, and technology stocks experienced their largest one-day drop since 2022. Bitcoin fell to a low of 76,000 and has now rebounded to above 81,000.
This is counterintuitive, but it’s actually good news for encryption.
Trump and Musk seem to be intentionally creating a limited crisis to prick the U.S. stock market and create conditions for the Federal Reserve to flood the market with money.
Faced with the behemoth of $36.3 trillion in national debt (expanding by $3 million every minute), Trump's calculations are clattering in the Oval Office of the White House: every 1% rate cut by the Federal Reserve can free $400 billion from the noose of national debt interest.
This is equivalent to obtaining military expenditures for ten Ford-class aircraft carriers out of thin air every year. When the debt scale exceeds 120% of GDP, the hemostatic forceps of traditional economics have become ineffective, and the Trump team seems to be planning a breakthrough path full of gunpowder - using economic recession to force monetary easing.
This "negative leverage" operation is the most dangerous balancing act in modern financial history: using tariffs to smash global supply chains, using government layoffs to create a cold wave in the job market, and allowing the stock market to plummet and cause wealth to evaporate, forcibly turning the flames of inflation into a deflationary ice field. As the "financial repression" strategy revealed by former Lehman trader McDonald, this is a desperate struggle to suppress interest rates below the inflation rate, and it is also a targeted explosion of the debt empire's own blood vessels.
Fed Chairman Powell's tough stance is a perfect footnote in Trump's tactical sandbox. When unemployment data rises with corporate layoffs, and when the PMI index falls into a contraction range under the impact of tariffs, the central bank, which once used "data dependence" as a shield, is being bitten back by the rules it set. In this ultimate power game, Trump downplayed it in front of the Fox News camera: "The pain of the transition period will eventually pass", and Powell's toolbox only has the morphine of interest rate cuts.
This gamble is not without trace. The lesson of the Great Depression in 1929 warns that the natural bursting of bubbles will lead to a systemic collapse, while the Bank of Japan's initiative to burst the bubble in 1990 brought about the "lost thirty years" but preserved the foundation of the industry. Trump obviously chose the latter - to create a limited crisis in exchange for the strategic depth of the dollar hegemony.
Nomura Securities' analysis reveals the steel blade beneath the gentle veil: the so-called "mild recession" is actually using unemployment as a bulldozer for supply-side reform. When the federal government cuts off the "fat" in the 1.5 trillion deficit and when tariff barriers force the manufacturing industry to return, this operation will not only remove the rotten flesh of debt, but also reshape the bones of the US economy. The layoffs of tens of thousands of people in the department led by Musk are just the prelude to this drama.
This heroic economic experiment will eventually answer a fundamental question: When an empire reaches the edge of a debt cliff, what kind of courage and madness does it take to turn around and avoid falling into the abyss? The answer may be hidden in Trump's monologue of "either success or death" - this is a gamble of the times, and it is also the last crazy self-rescue of the dollar hegemony.
When the guillotine of Nasdaq cut off the last bull head and Tesla's stock price was cut in half, a cruel truth surfaced: the darkest moment of the US stock market is the bloody dawn of the US dollar hegemony. The Trump-Musk alliance is reconstructing the underlying logic of global capital flows with "creative destruction" - using a controllable financial market earthquake to replace the engine of the US dollar system, welcome the low interest rate range, and once again obtain all-round means to stimulate the economy.
The cost of this operation is bound to be tragic: the pension accounts of the middle class evaporated, the market value of technology giants was halved, and the global industrial chain was drastically restructured... But from the perspective of the empire, this may be the only antidote to prolong the life of "American exceptionalism." After all, under the sword of Damocles of 36 trillion debt, no country can solve the crisis elegantly - either suffocate in the bubble or rebuild in blood.
The darkness before dawn is the most dangerous, but the person holding the scalpel has already seen the dawn in the blood.
Buffett has already smelled blood, and is waiting for the market to crash and buy at the bottom with more than 300 billion U.S. dollars in cash; Wall Street has fallen into a collective frenzy of "recession trading", and the plunge in the two-year U.S. Treasury yield indicates that expectations for interest rate cuts have become a consensus.
When the flood of liquidity overflows again, there is only one word left for the crypto market: up, up, up.
Friendly reminder: This is the last wave of carnival in this round, remember to jump off the car when it’s almost time.
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