Gu Jingci: 8.1 Some Views on Interest Rate Hikes, Interest Rate Cuts, and Warsh's Remarks

Bitcoin/Ethereum has been relatively quiet lately, and those without patience will suffer significant losses in this market. We have consistently advised holding firmly and shorting on rallies, as while the overall volatility is not high, there is still considerable potential. The market traded sideways over the weekend, and opportunities are always for those who are prepared. Today, let's discuss something else related to the current market: some differences between Powell and Warsh's tenures. First, I increasingly feel that Warsh is like a lackey of Trump. When he first took office, he emphasized hawkishness, interest rate hikes, and combating inflation. Later, he simply dragged things out, citing persistently high inflation, and then looking at the data. After reviewing the data once, he would want to review even more, followed by investigations that would last for months, further delaying the process. Trump's current goal is precisely to buy time, given the upcoming midterm elections; as long as interest rates are not raised, it's beneficial for him. There's a saying that an enemy who remains neutral is helping you, and Warsh is currently embodying this stance. Secondly, Powell is very direct in both raising and lowering interest rates, and his statements are also very straightforward. He does what he says, and if there's no interest rate hike and inflation is high, he's hawkish when necessary. In contrast, Warsh's speech left you wondering what he was trying to say. Crucially, he stated from the outset that he wouldn't provide any forward guidance in subsequent speeches, which was tantamount to playing dumb from the start. It's estimated that Warsh will continue to stall, focusing primarily on data. The investigation committee won't be established until the end of the year, by which time the midterm elections will be over, and whether or not interest rates are raised will be irrelevant. Furthermore, this might be a decision based on the current situation in the US. After all, interest rate hikes in recent years have just ended, with initial rate cuts. Raising rates again now would be detrimental to both sides, and further delays will only prolong the process.