Stock, bond, and currency crash, I'm truly impressed
Tomorrow when the US stock market opens, I’m still worried about the risk of a circuit breaker. As I’ve mentioned before, the liquidity crisis is a significant tail risk for Bitcoin. If the US stock market has a circuit breaker, I fear Bitcoin will be dragged down with it. It looks like the 10-year US Treasury is about to crash tomorrow.
Short sellers are also very nervous. If the 'understanding king' says a couple of positive things tomorrow, it might trigger another short squeeze. It's tough.
Wall Street is also struggling. Ackman has already lost a lot; these days he’s been crazily urging to postpone the tariff enforcement for a month, but the 'understanding king' doesn’t listen at all. Musk’s words are also ineffective; US-EU tariffs remain unchanged. Even Netanyahu's influence seems to have waned, so when everyone sees that even Netanyahu is struggling, they panic.
Right now, I just don’t know how long this extremely outrageous level of tariffs will last, because this level is absolutely unsustainable. If it continues, it will lead to a global recession. I don’t know how negotiations between various countries are progressing, and based on the tariff levels, the market will price in recession and stagflation narratives.
I’ve mentioned before that if tariffs lead to a recession in the US, it will be global. I expect there will be two legs of decline; during the real recession, the second leg of deleveraging will drop severely. However, the Federal Reserve will ultimately save the market, but the recovery period after the recession will be very long.
The national fortune of the United States is going to be ruined by the tariffs of the Empress Dowager.