The Trump administration may have intentionally created uncertainty in stock markets to corner the Federal Reserve Chair Jerome Powell with lowering interest rates, according to a market commentator.
Doing this increases the likelihood that the US will no longer have to refinance around $ 7 trillion in its debt owed over the next few months, Bitcoin commentator Anthony Pomplano Says In a post 10 x post.
US president Donald Trump and Secretary of Treasury Scott Bestent “take things in their own hands; they crash asset prices in an attempt to force Jerome Powell to cut interest rates,” said Pompiano, who serves as the founder and CEO of the Professional Capital Management and host of POMPast.
In late January, Powell announced that Fed does not lower interest rates From the current range of target 4.25% to 4.5% despite calls from Trump to do so.
Pompliano said the recent market The panic is driven In part of Trump’s tariffs-and used to create a more favorable bond market while lowering Treasury’s 10-year yield.
He mentioned that the 10-year yield of Treasury had already had down From about 4.8% in January to 4.21% today – a sign that Trump’s purported approach was “in the right direction.”
Source: Thomas Kalow
Whether Pompliano’s theory is right or not, the stock market has become tanking of the latter, and the crypto is that it is even more difficult.
Extensive market index funds like State Street’s Standard and Poor’s 500 Index Fund (Spy) fell 2.66% on March 10 only, while the NASDAQ-100% fell 3.8%, Google’s financial data shows.
Both indexes drop 7.32% and 10.7% in the last month, while Bitcoin (Btc) dropped 27.4% from $ 108,786 all-time high, and over $ 1.2 trillion became Pinasan From the Cap of the Cryptocurrency Market since December 17.
If the stock market continues the tank, it will go down to a “WHO BLINKS FIRST” contest between Trump and Powell, Pompliano said.
While Trump has not confirmed such an approach, Pompliano pointed to an interview with Fox News on March 9 where Trump said: “No one is rich when interest rates are high because people can’t borrow money.”
Pompliano added that lowering interest rates will also benefit American consumers:
“The big goal is to get interest rates, and this will lead to more economic activity, thanks to accessing cheap capital. Give people cheap capital and they will go and do things here.”
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The CME Fedwatch, a tool used to measure expectations for a Changing Federal Reserve Interest rates, would have kicked a 96% probability that the target rate would remain between 4.25% and 4.50% following the next Federal Reserve meeting on March 19.
However, it is close to 50-50 odds for the target rate to be lowered to Federal Reserve’s Following the meeting on May 7.
The Federal Reserve usually prevents the decrease of interest rates when Inflation is highAs one of its main goals is to maintain price stability.
However, a Trump’s recession, Or “Trumpcession,” as it calls, can force the top bank of America to start again.
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