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With the US economy struggling with rampant inflation, investors are eagerly waiting for the US Federal Reserve to announce the next Federal Fund rate hike next month. Harris Kupperman, founder of hedge fund Praetorian Capital, thinks it’s very likely that the Fed’s rate hike onslaught will “blow the Treasury.” Moreover, amid pessimistic macro trends, Jessica Walker, chief marketing officer at Fluid Finance, says the economic downturn and fiat currency weakness reveal the true benefits of cryptocurrencies. .
Bitcoin.com News of the Week report About many analysts who believe the US Central Bank will codify another three-fourths of a percentage point rise in the Federal Funds Rate (FFR) at its November meeting. On October 18, Harris Kupperman, founder of hedge fund Praetorian Capital, said: report It claims that the Fed is currently trapped, hence the avalanche is moving, and despite the tough talk, the Fed needs to pivot to raising the FFR I think
kupperman too claimed His argument on the podcast “Forward Guidance” is when he detailed that the Fed would really struggle when oil surged again. Praetorian Capital founder and chief adventurer. capitalist adventurein a podcast, argued that the Fed must turn around and accept high inflation as a reality today. He said continued rate hikes could lead to a “blow-up of the Treasury Department.”
Additionally, J. Kim of the skwealthacademy substack explains: Recent blog posts The forgotten financial weapons of mass destruction of 2008 are still a problem in 2022. I believe Under these market conditions, a flash crash in the Treasury market is inevitable, he said. Talking about financial weapons of mass destruction, Kim details how the perception that the world’s derivatives have declined significantly since 2008 is an illusion.
Kim’s article adds:
Bankers reduce their positions in these highly risky products that could collapse like a matrix of dominoes if one major bank were to default in any of these major categories of derivatives. If you think you did, you would be wrong.
Kim’s blog post explains how the US Central Bank could go rogue and wreak havoc on bond markets, similar to Kupperman’s position.
While the ECB appears to have kept its promise not to collapse this important derivatives market, the US Central Bank has not, said Kim’s blog post. If the Federal Reserve really goes rogue by continuing to boost the strength of the U.S. dollar against all other major global fiat currencies, this could lead to illiquidity in the worlds largest bond market, the U.S. Treasury. Not only could it lead to financial risks, but it could also lead to large-scale defaults, as does the U.S. dollar-denominated interest rate derivatives market.
Meanwhile, Fluid Finance chief marketing officer Jessica Walker told Kitco News anchor and producer David Lin of Kitco that options such as diversification and cryptocurrencies shine amid these macro trends. said. People are very concerned about the security of their own fiat currencies and their own coins right now, Walker told Lin at the Future Blockchain Summit in Dubai. Being able to diversify and have alternatives to fiat currencies is more important than ever in a time of great geopolitical uncertainty.
Walker also spoke about Canadian truck drivers’ protests against mandatory vaccines earlier this year. Stop Prevents Ottawa’s Freedom Convoy from receiving donations.At the time, banks froze bank accounts and Canadian Prime Minister Justin Trudeau called Emergency Law for Dealing with Protests. “It was a pretty scary time. I was more of an advocate of decentralization,” Walker said on Friday. , said a Fluid Finance executive.
In terms of diversification, Walker believes in Bitcoin, Ethereum, and several other blockchain projects. I do dollar-cost averaging of Bitcoin and Ethereum and then look at projects that I really believe in, Walker said. Said Kitco host on Friday.
What are your thoughts on Harris Kupperman and J. Kim’s take on the current volatile US Treasury market amidst the aggressive US central bank? What are your thoughts on Fluid Finance executive Jessica Walker’s diversification strategy? Let us know what you think about this in the comments section below.
image credit: Shutterstock, Pixabay, Wiki Commons, Editorial Photo Credit: Luis Boza / Shutterstock.com
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