Powell OUT, Warsh IN as Fed Chairman SOON!

[Satofan44]

Companies can hype all they want, but central banks have the final say on the state of the economy. This directly affects the stock market. So if a central bank like the FED decides to cut rates, the market will boom. The inverse happens if rates are raised. Considering that the new FED chairman is hawkish, I'm afraid both crypto and stocks will continue to decline within the short-term. Even precious metals such as Gold and Silver are suffering. I'm not sure about bonds, though.

Every decision the FED makes affects us one way or another. Even if Kevin Warsh wants to satisfy Trump by cutting rates, there will be other board members that will oppose him. Former chairman Jerome Powell is still on the Board of Governors. Since inflation is high, the FED should either leave rates unchanged or raise them a bit. We'll see what happens...

This is due to the fact that this is the accurate assessment of the US and the world at this time. I would rather a honest FED chairman than one pretending that everything is fine when the economic situation is in a terrible situation, and actually doing the opposite of what the economy needs in most cases will cause even more damage leading to a spiral. The world has been in various chaotic issues for over a decade now, the illegal migration scam, the pandemic, various wars and many other things are going on. The situation has yet to stabilize let alone actually become bullish. At the current overview, the situation still does not look bright. When you have retards on the "opposing" sides always arguing in favor of more war, then we find ourselves in this situation. You have many who want Trump to back off of the peace deal and engage in more war, and many that want Zelensky to fight until every single Ukranian is dead or Ukraine is gone for good instead of conceding to what has already been lost.

Too many people have incentives for this kind of thing, the system is backwards. If things were normal, whatever that means these days, for 5 to 10 years we would be back in golden times.

[Wind_FURY]

The market was reminded again who is in charge here.

While everyone was arguing about AI, SpaceX, robotaxi and new hype deals, the Fed calmly came out and said: guys, no one canceled the bets.

The new head of the Fed, Kevin Warsh, made it clear that if inflation does not cool down, the rate may rise by another 50 bps.

And the market was like, OK, we remembered. Nasdaq , S&P 500 decreased their values . The yield on 10-year treasuries has gone to 4.6%.

AI can be a real technological wave. Nvidia can keep making money. Data centers can be built.
So I wouldn't be looking at who says “AI” the loudest right now. I would see who would survive the 4.5%+ rate without fairy tales and presentations.

Bitcoin reacted only with increased volatility.

Companies can hype all they want, but central banks have the final say on the state of the economy. This directly affects the stock market. So if a central bank like the FED decides to cut rates, the market will boom. The inverse happens if rates are raised. Considering that the new FED chairman is hawkish, I'm afraid both crypto and stocks will continue to decline within the short-term. Even precious metals such as Gold and Silver are suffering. I'm not sure about bonds, though.

The U.S. stock market, particularly in the A.I. sector are actually continuing to surge to their new All Time Highs, not "continuing to go down".

Every decision the FED makes affects us one way or another. Even if Kevin Warsh wants to satisfy Trump by cutting rates, there will be other board members that will oppose him. Former chairman Jerome Powell is still on the Board of Governors. Since inflation is high, the FED should either leave rates unchanged or raise them a bit. We'll see what happens...

I believe that because their midterm election is coming, Trump will probably want to lower inflation and sacrifice the A.I. surge to stabilize prices of goods and services.

[SquallLeonhart]

To be fair, if it is rising, then inflation would be battled, but investments will drop, and then the price of bitcoin would also drop, and considering we are suppose to be in bear market, it would be even more. But if it is cut down, and smaller, then investment will go up, and bitcoin price would be in a weird position.

Because rates cut down would mean that people would withdraw their money from there, and look to invest somewhere, but bitcoin is in a bear market and gone down 50%+ so far, which means that it may not be a prime place to put your money in since people expect it to not recover right away. So I am not sure what would happen, and we have to wait and see how the market will react and what will happen with his meeting.

[JeffBrad12]

To be fair, if it is rising, then inflation would be battled, but investments will drop, and then the price of bitcoin would also drop, and considering we are suppose to be in bear market, it would be even more. But if it is cut down, and smaller, then investment will go up, and bitcoin price would be in a weird position.

Because rates cut down would mean that people would withdraw their money from there, and look to invest somewhere, but bitcoin is in a bear market and gone down 50%+ so far, which means that it may not be a prime place to put your money in since people expect it to not recover right away. So I am not sure what would happen, and we have to wait and see how the market will react and what will happen with his meeting.

Seems like there is an impending rate hike and hawkish stance in the future even with Warsh as a Chairman.
This could be a bad news for bitcoin when recovery is still ongoing from the most recent dumps. After all, whether rate hikes or not depend on votes not the Chairman.
Stock market already reacted with the rumour and plunged a little because 9 Fed official already signaled support for it.

[Wind_FURY]

To be fair, if it is rising, then inflation would be battled, but investments will drop, and then the price of bitcoin would also drop, and considering we are suppose to be in bear market, it would be even more. But if it is cut down, and smaller, then investment will go up, and bitcoin price would be in a weird position.

THEN the Four-Year-Cycle would be complete.

 

Because rates cut down would mean that people would withdraw their money from there, and look to invest somewhere, but bitcoin is in a bear market and gone down 50%+ so far, which means that it may not be a prime place to put your money in since people expect it to not recover right away. So I am not sure what would happen, and we have to wait and see how the market will react and what will happen with his meeting.

I'm VERY confident that those people will miss the best opportunity to buy Bitcoin. Plus a majority of those people will be the plebs who will FOMO at prices OVER $100,000, or probably higher than that.

 ¯\_(ツ)_/¯

[bubilas]

The new Fed chairman proved to be firm on his principles but cautious about his upcoming rate decision. He didn't signal a mandatory hike in July and outright refused to "predetermine" the outcome of the meeting. At the same time, he repeatedly emphasized that the Fed has no intention of tolerating persistent inflation.

You didn't seem to remember his words about crypto: Warsh was asked whether the Fed would bail out the crypto market or stablecoin-related entities in the event of a systemic crisis. His response:
"We're trying to get to a position where we don't have to bail out anyone, including crypto."
The Fed doesn't want to bailout. However, he didn't say the Fed would ignore systemic risk. The goal is to limit risks in advance so that a bailout isn't necessary. The logic is that: Crypto is already being actively integrated into banks and the payment system.
And it's considered a segment of the financial market.
Historically, the Fed has worked to prevent systemic risks, but it has no intention of restricting or stimulating the development of the cryptocurrency sector specifically.

[summonerrk]

The new Fed chairman proved to be firm on his principles but cautious about his upcoming rate decision. He didn't signal a mandatory hike in July and outright refused to "predetermine" the outcome of the meeting. At the same time, he repeatedly emphasized that the Fed has no intention of tolerating persistent inflation.

You didn't seem to remember his words about crypto: Warsh was asked whether the Fed would bail out the crypto market or stablecoin-related entities in the event of a systemic crisis. His response:
"We're trying to get to a position where we don't have to bail out anyone, including crypto."
The Fed doesn't want to bailout. However, he didn't say the Fed would ignore systemic risk. The goal is to limit risks in advance so that a bailout isn't necessary. The logic is that: Crypto is already being actively integrated into banks and the payment system.
And it's considered a segment of the financial market.
Historically, the Fed has worked to prevent systemic risks, but it has no intention of restricting or stimulating the development of the cryptocurrency sector specifically.

Yeah, that important. Thanks.
The intrigue remains: todays Senate testimony. I expect Warsh to take a similar tone, but potentially harsher in his responses.
Because the questions will likely be more politicized and aggressive.
His strategy:
1. Don't give a direct signal for either a hike or a cut.
2. Repeat that the decision depends on the totality of the data.
Powell's mantra: "data dependent." Don't allow the market to interpret the weak June CPI as a final victory over inflation.
3. Emphasize the Fed's independence. Avoid as much as possible specific promises regarding the balance sheet and the timing of rate changes.
And I think he will withstand this onslaught of criticism and tough questions. The main thing: he has already (almost) dispelled fears of dependence on the Trump administration. Taken together, this position allows markets to shift their focus to economic data, rather than the rhetoric of the FOMC bankers.

[Wind_FURY]

Kevin Warsh will deliver his first speech at the Jackson Hole Economic Symposium later. The Bitcoin market is probably cautious, with some traders selling some of their Bitcoin and caused a correction below $80,000. Although, there are people who believe that he will not give "forward guidance". He will merely give an outline on where he wants to take the broader monetary policy under a situation where inflation in the United States is still above the Federal Reserve's 2.00% target.

  ¯\_(ツ)_/¯

Perhaps no announcement of a pivot to Q.E.

[pooya87]

I think some people are putting too much faith in the relationship between what FED does and bitcoin price!

For example what we are seeing now is just a correction after a $20,000 rise not a sell off because some dude in FED is supposed to say something.
Don't get me wrong, the recession that is caused by the high interest rates and the uncertainty that is caused by the "capital" waiting for some decision is hurting the economy as a whole and that shows up in the bitcoin market as well but it is not as strong a some people think it is.

[Abiky]

I think some people are putting too much faith in the relationship between what FED does and bitcoin price!

For example what we are seeing now is just a correction after a $20,000 rise not a sell off because some dude in FED is supposed to say something.
Don't get me wrong, the recession that is caused by the high interest rates and the uncertainty that is caused by the "capital" waiting for some decision is hurting the economy as a whole and that shows up in the bitcoin market as well but it is not as strong a some people think it is.

Bitcoin should move regardless of what happens with the mainstream economy. The whole point is to be a safe haven or store of value. I think the reason why the market reacts to the FED's decisions is because of the current administration's ties to crypto. I mean, Trump and his cabinet members have proclaimed themselves as pro-Bitcoin or crypto-friendly. Therefore, anything happening within the US government (good or bad) could have direct effects over Bitcoin's market price. At least, that's how I see it. But I could be wrong...

I wouldn't worry too much about the FED. With inflation kicking into high gear (thanks to Trump's tariffs and Iran war), we should only expect the USD to weaken itself over the long run. It will be even worse with alternative Fiat currencies. Bitcoin, on the other hand, will continue to rise towards "infinity and beyond". Just you wait and see.

[Swordsoffreedom]

Bitcoin should move regardless of what happens with the mainstream economy. The whole point is to be a safe haven or store of value. I think the reason why the market reacts to the FED's decisions is because of the current administration's ties to crypto. I mean, Trump and his cabinet members have proclaimed themselves as pro-Bitcoin or crypto-friendly. Therefore, anything happening within the US government (good or bad) could have direct effects over Bitcoin's market price. At least, that's how I see it. But I could be wrong...

I wouldn't worry too much about the FED. With inflation kicking into high gear (thanks to Trump's tariffs and Iran war), we should only expect the USD to weaken itself over the long run. It will be even worse with alternative Fiat currencies. Bitcoin, on the other hand, will continue to rise towards "infinity and beyond". Just you wait and see.

The Fed's impact on the market is nothing new. We saw the same thing under Biden. The Fed's statement and rate decision have always had an impact on investor sentiment and the market.

It wasn't just Bitcoin. Gold and stock also dropped while the DXY jumped after Kevin Warsh's pretty hawkish remarks. That's not a coincidence, whether we like to admit it or not.

But that's only a short term effect because the Fed is not the only factor affecting the market.

[coinrifft]

The Fed's impact on the market is nothing new. We saw the same thing under Biden. The Fed's statement and rate decision have always had an impact on investor sentiment and the market.

It wasn't just Bitcoin. Gold and stock also dropped while the DXY jumped after Kevin Warsh's pretty hawkish remarks. That's not a coincidence, whether we like to admit it or not.

But that's only a short term effect because the Fed is not the only factor affecting the market.

That would be the key word here, it will have a impact but it's short lived. We all know how speculative crypto market in general. And in the past, covid-19, wars, geo-politics has somewhat put a dent in the market price.

Nevertheless, the impact didn't last that long. And for experienced investors, they will take this advantage of a momentarily lull in the market and continue their buying spree. This what separates the wise investors from those who easily buying the news and selling their crypto right away when the market goes down.

[Taskford]

The Fed's impact on the market is nothing new. We saw the same thing under Biden. The Fed's statement and rate decision have always had an impact on investor sentiment and the market.

It wasn't just Bitcoin. Gold and stock also dropped while the DXY jumped after Kevin Warsh's pretty hawkish remarks. That's not a coincidence, whether we like to admit it or not.

But that's only a short term effect because the Fed is not the only factor affecting the market.

That would be the key word here, it will have a impact but it's short lived. We all know how speculative crypto market in general. And in the past, covid-19, wars, geo-politics has somewhat put a dent in the market price.

Nevertheless, the impact didn't last that long. And for experienced investors, they will take this advantage of a momentarily lull in the market and continue their buying spree. This what separates the wise investors from those who easily buying the news and selling their crypto right away when the market goes down.

Yeah there's provably impact on that replacement happened. Knowing how people react with the news they read.

Those events or Macro shocks happening could move the market temporarily. But as what we experience also base on the data shown the effect is just temporary.

That's why many people have experience to deal with this situation treat the possible dips as another good opportunity. While those new or emotional investors always got carried out by panic, usual for them to lose because they are so easy to be manipulated.

We always see that short term Fuds does not beat Bitcoin long term potential, that's why those people need to relax if there's some market stress came.

[pooya87]

Bitcoin should move regardless of what happens with the mainstream economy. The whole point is to be a safe haven or store of value. I think the reason why the market reacts to the FED's decisions is because of the current administration's ties to crypto. I mean, Trump and his cabinet members have proclaimed themselves as pro-Bitcoin or crypto-friendly. Therefore, anything happening within the US government (good or bad) could have direct effects over Bitcoin's market price. At least, that's how I see it. But I could be wrong...

I guess.

I personally feel like this is repetition of history. A couple of years ago we saw topic after topic being created about how bitcoin follows US stock market just because due to recession at the time they both dumped at the same time! They said it so many times until we started seeing panic sells each time the US stock market dumped. That lasted for a while and I haven't heard anything of the kind for a long time now simply because there was no  correlation to begin with and people forgot about it just as quickly as they got on board of the panic sell train

Recession is affecting bitcoin for sure, but reacting to FED thing is the same panic moves all over again.

[STT]

My take on Warsh so far has been he is far more 'dovish' then anticipated.   However the tides and free markets matter far more then the man standing at the shoreline attempting to command the sea in its direction.  My take is even with 30 bull dozers you will struggle to defeat a situation fundamentally opposed in direction and strength, they can only attempt to smooth the path imo.

  Ultimately the FED is not dictating the situation only reacting to it and I would go on previous actions over decades as to what likely happens.   The FED might well react but it will lag the move, unlikely to curb movements directly.   Their first attempt is always via 'language' and indicating they will raise cost of money before they actually do.

  The FED actively tries to cast a bigger shadow ahead of itself then it actually is, a larger echo then the volume they can produce.   Its for sure that central banks even the largest cannot turn the tide.

[abhiseshakana]

I think some people are putting too much faith in the relationship between what FED does and bitcoin price!

For example what we are seeing now is just a correction after a $20,000 rise not a sell off because some dude in FED is supposed to say something.
Don't get me wrong, the recession that is caused by the high interest rates and the uncertainty that is caused by the "capital" waiting for some decision is hurting the economy as a whole and that shows up in the bitcoin market as well but it is not as strong a some people think it is.

Bitcoin should move regardless of what happens with the mainstream economy. The whole point is to be a safe haven or store of value. I think the reason why the market reacts to the FED's decisions is because of the current administration's ties to crypto. I mean, Trump and his cabinet members have proclaimed themselves as pro-Bitcoin or crypto-friendly. Therefore, anything happening within the US government (good or bad) could have direct effects over Bitcoin's market price. At least, that's how I see it. But I could be wrong...

I wouldn't worry too much about the FED. With inflation kicking into high gear (thanks to Trump's tariffs and Iran war), we should only expect the USD to weaken itself over the long run. It will be even worse with alternative Fiat currencies. Bitcoin, on the other hand, will continue to rise towards "infinity and beyond". Just you wait and see.

We should not forget that bitcoin operated on the financial system where its liquidity highly influenced by FED even Bitcoin disregarding macroeconomic conditions and has independent monetary system which can not be intervere by central bank. We could say that profit taking can explain about bitcoin correction after a major rally, but we can not ignore FED part on its ecplanation when correction happen along with rising real yields, USD strengthened, liquidity tightened, deleverage, and waning risk appetite.

At the meantime Bitcoin may be heading towards monetary independence but does not yet possess market independence, it has not yet become a safe haven asset that is widely recognized and treated as such by either nations or the global financial system. Of course we wait the diminish of bitcoin correlation with the decision of a single central bank, which mean Bitcoin no longer viewed as risk asset that happens to have a limited supply but bitcoin treated as a monetary asset with a distinct function outside the fiat system

[adultcrypto]

Powell have tried in his tenur as Fed chair so he will be living with pride as a success. Being able to work with different administrations is a testament to how great he performed in that office so those who know him will miss him for his strength in character and not easily pushed around by anybody. Kevin Warsh is a pro cryptocurrency candidate and it is believed that his policies will favor cryptocurrency especially bitcoin.

[SUPERSAIAN]

Powell have tried in his tenur as Fed chair so he will be living with pride as a success. Being able to work with different administrations is a testament to how great he performed in that office so those who know him will miss him for his strength in character and not easily pushed around by anybody. Kevin Warsh is a pro cryptocurrency candidate and it is believed that his policies will favor cryptocurrency especially bitcoin.

It could be argued that Powell did his best during his term, but looking at the results, I don't think the Fed passed the test of dealing with inflation very successfully. The persistence of inflation, especially in the last few years, clearly shows the enormous cost of mistakes and delayed decisions in monetary policy. The Fed's view of inflation as temporary and its failure to act aggressively enough for a long time is now affecting people's purchasing power.

[Wind_FURY]

I think some people are putting too much faith in the relationship between what FED does and bitcoin price!

For example what we are seeing now is just a correction after a $20,000 rise not a sell off because some dude in FED is supposed to say something.

Don't get me wrong, the recession that is caused by the high interest rates and the uncertainty that is caused by the "capital" waiting for some decision is hurting the economy as a whole and that shows up in the bitcoin market as well but it is not as strong a some people think it is.

Laughable post.

It's not "putting faith in the relationship between the Federal Reserve and the market", ser. Plus I didn't get you wrong, but you got my post wrong. It's simply the market being the market, ser. Higher rates = less liquidity = bearish. Lower rates = more liquidity = bullish.

 

[BALIK]

Kevin Warsh is a pro cryptocurrency candidate and it is believed that his policies will favor cryptocurrency especially bitcoin.

That is not going to happen.

Unlike the president, Fed has pretty limited power over crypto. Their job is to run monetary policy based on the state of the economy, not to serve the interest of one industry or one asset.

Also, the Fed chair can't just make every monetary policy decision on his own. Most major decision have to go through a vote. So even if Kevin Warsh wanted policies that were good for crypto, he'd still have to convince the other members of the Fed.

So yeah, do not put too much hope in him.