{"id":30759,"date":"2023-10-10T10:52:38","date_gmt":"2023-10-10T14:52:38","guid":{"rendered":"https:\/\/cryptocornercafe.com\/cafe\/?p=30759"},"modified":"2023-10-10T10:52:38","modified_gmt":"2023-10-10T14:52:38","slug":"bitcoin-and-crypto-poised-to-skyrocket-as-endgame-of-us-policy-nears-analyst","status":"publish","type":"post","link":"http:\/\/cryptocornercafe.com\/cafe\/2023\/10\/10\/bitcoin-and-crypto-poised-to-skyrocket-as-endgame-of-us-policy-nears-analyst\/","title":{"rendered":"Bitcoin And Crypto Poised To Skyrocket As Endgame Of US Policy Nears: Analyst"},"content":{"rendered":"

The intricacies of US monetary policy have been placed under the microscope by Jordi Alexander, CIO of Selini Capital, who today offered an incisive analysis<\/a> of the potential ripple effects these policies may have on the Bitcoin and crypto market. Drawing correlations between traditional financial mechanisms and the nascent digital asset landscape, his commentary elucidates a series of complex market dynamics that every investor should be aware of.<\/p>\n

At the crux of Alexander\u2019s argument is his observation that the Federal Reserve\u2019s approach to handling current economic conditions might be nearing an inflection point. As reported<\/a> by NewsBTC, there are growing concerns in the bond market. Bonds with maturities exceeding 10 years have seen a decline of 46% from their highest value in March 2020. Moreover, the 30-year bonds have fared even more poorly, with a drop of 53%.<\/p>\n

Alexander remarked, \u201cHaven\u2019t expressed macro views in a while \u2013 but as things are about to really start moving \u2013 its time. I spent months analyzing the endgame of US policy. The outcome I saw is now coming into view. Gradually at first.. then all at once, the Fed will poo-poo in their pampers. \u201d<\/p>\n

Why QE Might Be Back Sooner Than Later<\/h2>\n

The analyst perceives the recent shifts in the bond market, especially concerning long-term bonds, as a precursor to potential policy changes. To back this up, Alexander is referencing Nick Timiraos of the Wall Street Journal who recently highlighted a specific sentiment from the Dallas Fed President Lorie Logan that is indicative of this shift.<\/p>\n

Logan has begun to express reservations about the earlier hawkish stance of the Federal Open Market Committee (FOMC), largely due to the recent surges in Treasury yields and term premiums.\u00a0Her concerns emphasize the tug-of-war between the need for restrictive financial conditions to bring inflation down and the current strength of the labor market and overall economic output.<\/p>\n

Remarkably, Logan believes that the reasons for the tightening of financial conditions, especially those connected with the recent surges in Treasury yields and term premiums, might reduce the necessity to raise the fed funds rate.<\/p>\n

Commenting on this U-turn by the Fed\u2019s Logan, Alexander argues, \u201cThis is the Bat-Signal I have been waiting for. What does it mean? Why is the Dallas Fed president in the top tweet doing a big baby U-turn? Because they are starting to realize they are losing control of the bond market!\u201d<\/p>\n

Expanding on the nuances of the bond market, Alexander emphasized the distinction between the front and back ends of the curve. He stated, \u201cThe front of the curve, such as T-bills & 2-year bonds, are generally very responsive to rate guidance by the Fed\u2026 But the Fed never has as good control over the back end- especially 30-year bonds.\u201d Alexander\u2019s analysis points towards a decelerating demand for these long-term bonds, suggesting a potential loss of market control by the Federal Reserve.<\/p>\n

This evolving bond market scenario places the Federal Reserve in a precarious situation. Alexander, elaborating on this potential dilemma, posits, \u201cWhat if they agree to stop raising rates or even initiate cuts, but bond buyers still don\u2019t show up?\u201d He further speculated on a possible shift \u2013 the endgame \u2013 in the Federal Reserve\u2019s approach: \u201cPlaced between a rock and a hard place, the Fed might be pushed towards Yield Curve Control,\u201d hinting at a reversion to Quantitative Easing (QE) policies.<\/p>\n

Drawing a parallel to the Japanese financial scenario, Alexander prophesied, \u201cThe USD could very well be the casualty of this policy direction, much like the Yen\u2019s predicament in Japan.\u201d He then connected these macroeconomic shifts to the digital asset space, forecasting, \u201cGoodbye Quantitative Tightening, hello my old friend Mr. QE. The timeline is uncertain, but it is time to start paying attention to term premium, like the Dallas Fed!\u201d<\/p>\n

Bitcoin And Crypto Could Profit Massively<\/h2>\n

Ultimately, QE is something that Bitcoin and cryptocurrencies have benefited tremendously from in the last bull market. Alexander therefore also predicts \u201cyes your internet coins [aka Bitcoin and crypto] could then benefit\u201d. Remarkably, this view is shared by several analysts.<\/p>\n

BitMEX founder Arthur Hayes recently expressed<\/a> a similar view, according to which the Fed will sooner than later find itself in a bind to reintroduce QE. Hayes predicts a Bitcoin price of $750,000 in 2026.<\/p>\n

But this perspective isn\u2019t universally accepted. Yuga.eth from Coinbase drew on Austan Goolsbee\u2019s confidence in the FOMC\u2019s commitment to tackling inflation. To this, Alexander sharply responded, \u201cNothing about increasing the debt is helping the inflation anyway. As I wrote at the very beginning, the only way to do it properly would be to increase taxes, especially corporate.\u201d<\/p>\n

At press time, Bitcoin traded at $26,677.<\/p>","protected":false},"excerpt":{"rendered":"

<\/p>\n

The intricacies of US monetary policy have been placed under the microscope by Jordi Alexander, CIO of Selini Capital, who today offered an incisive analysis<\/a> of the potential ripple effects these policies may have on the Bitcoin and crypto market. Drawing correlations between traditional financial mechanisms and the nascent digital asset landscape, his commentary elucidates a series of complex market dynamics that every investor should be aware of.<\/p>\n

At the crux of Alexander\u2019s argument is his observation that the Federal Reserve\u2019s approach to handling current economic conditions might be nearing an inflection point. As reported<\/a> by NewsBTC, there are growing concerns in the bond market. Bonds with maturities exceeding 10 years have seen a decline of 46% from their highest value in March 2020. Moreover, the 30-year bonds have fared even more poorly, with a drop of 53%.<\/p>\n

Alexander remarked, \u201cHaven\u2019t expressed macro views in a while \u2013 but as things are about to really start moving \u2013 its time. I spent months analyzing the endgame of US policy. The outcome I saw is now coming into view. Gradually at first.. then all at once, the Fed will poo-poo in their pampers. \u201d<\/p>\n

Why QE Might Be Back Sooner Than Later<\/h2>\n

The analyst perceives the recent shifts in the bond market, especially concerning long-term bonds, as a precursor to potential policy changes. To back this up, Alexander is referencing Nick Timiraos of the Wall Street Journal who recently highlighted a specific sentiment from the Dallas Fed President Lorie Logan that is indicative of this shift.<\/p>\n

Logan has begun to express reservations about the earlier hawkish stance of the Federal Open Market Committee (FOMC), largely due to the recent surges in Treasury yields and term premiums.\u00a0Her concerns emphasize the tug-of-war between the need for restrictive financial conditions to bring inflation down and the current strength of the labor market and overall economic output.<\/p>\n

Remarkably, Logan believes that the reasons for the tightening of financial conditions, especially those connected with the recent surges in Treasury yields and term premiums, might reduce the necessity to raise the fed funds rate.<\/p>\n

Commenting on this U-turn by the Fed\u2019s Logan, Alexander argues, \u201cThis is the Bat-Signal I have been waiting for. What does it mean? Why is the Dallas Fed president in the top tweet doing a big baby U-turn? Because they are starting to realize they are losing control of the bond market!\u201d<\/p>\n

Expanding on the nuances of the bond market, Alexander emphasized the distinction between the front and back ends of the curve. He stated, \u201cThe front of the curve, such as T-bills & 2-year bonds, are generally very responsive to rate guidance by the Fed\u2026 But the Fed never has as good control over the back end- especially 30-year bonds.\u201d Alexander\u2019s analysis points towards a decelerating demand for these long-term bonds, suggesting a potential loss of market control by the Federal Reserve.<\/p>\n

This evolving bond market scenario places the Federal Reserve in a precarious situation. Alexander, elaborating on this potential dilemma, posits, \u201cWhat if they agree to stop raising rates or even initiate cuts, but bond buyers still don\u2019t show up?\u201d He further speculated on a possible shift \u2013 the endgame \u2013 in the Federal Reserve\u2019s approach: \u201cPlaced between a rock and a hard place, the Fed might be pushed towards Yield Curve Control,\u201d hinting at a reversion to Quantitative Easing (QE) policies.<\/p>\n

Drawing a parallel to the Japanese financial scenario, Alexander prophesied, \u201cThe USD could very well be the casualty of this policy direction, much like the Yen\u2019s predicament in Japan.\u201d He then connected these macroeconomic shifts to the digital asset space, forecasting, \u201cGoodbye Quantitative Tightening, hello my old friend Mr. QE. The timeline is uncertain, but it is time to start paying attention to term premium, like the Dallas Fed!\u201d<\/p>\n

Bitcoin And Crypto Could Profit Massively<\/h2>\n

Ultimately, QE is something that Bitcoin and cryptocurrencies have benefited tremendously from in the last bull market. Alexander therefore also predicts \u201cyes your internet coins [aka Bitcoin and crypto] could then benefit\u201d. Remarkably, this view is shared by several analysts.<\/p>\n

BitMEX founder Arthur Hayes recently expressed<\/a> a similar view, according to which the Fed will sooner than later find itself in a bind to reintroduce QE. Hayes predicts a Bitcoin price of $750,000 in 2026.<\/p>\n

But this perspective isn\u2019t universally accepted. Yuga.eth from Coinbase drew on Austan Goolsbee\u2019s confidence in the FOMC\u2019s commitment to tackling inflation. To this, Alexander sharply responded, \u201cNothing about increasing the debt is helping the inflation anyway. As I wrote at the very beginning, the only way to do it properly would be to increase taxes, especially corporate.\u201d<\/p>\n

At press time, Bitcoin traded at $26,677.<\/p>\n

<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"colormag_page_layout":"default_layout","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[82],"tags":[],"class_list":["post-30759","post","type-post","status-publish","format-standard","hentry","category-blockchain"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/posts\/30759","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/comments?post=30759"}],"version-history":[{"count":0,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/posts\/30759\/revisions"}],"wp:attachment":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/media?parent=30759"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/categories?post=30759"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/tags?post=30759"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}