🔥 Growing Because Everything’s Bad?

Bitcoin and stocks held strong despite the weekend flare-up in the Middle East — a time when traditional markets are closed, leaving crypto to absorb the shock alone. After a quick “truce,” markets shifted focus to macro data, which shows the U.S. economy slowing, the labor market weakening, and inflation dynamics clouded by trade deal delays.

Despite that, markets are rising: Nasdaq hit all-time highs, and the S&P 500 is close. Why? Expectations of early Fed rate cuts. Even Powell, usually cautious, admitted tariffs may have less inflationary impact than feared. Meanwhile, the U.S. economy posted negative GDP in Q1 (-0.5%), and jobless claims suggest a declining labor market.

👉 On inflation: by the time mutual tariffs are fully in place, inflation may already be low enough that any rebound will be modest and short-lived. If so, the Fed may have to respond with aggressive cuts — 0.50–0.75%, not the standard 0.25%.

Rate cut expectations are rising: a week ago, the chance of a cut at the July 30 Fed meeting was 10%; now it’s 23%. Markets now expect three cuts by year-end.

👉 Lower rates = cheaper money = more liquidity = growth in risk assets.

The bull party may continue if weak inflation and growth data persists. ❗️But if the Fed hesitates, this rally could quickly turn into a hangover.

For now, I’m betting on growth.