3. QE Returning Doesn’t Mean Markets Will Explode Immediately

Many investors still cling to a simple formula: once the Fed stops QT and reintroduces QE—effectively adding liquidity—risk assets should surge right away.

But history suggests the opposite. During the last cycle, Bitcoin did not rally when QE resumed. Its first reaction was a decline, followed by a period of listless trading. Only after this lag did a sustainable uptrend emerge. As we look toward 2026—a midterm election year that often carries bearish undertones—the setup increasingly resembles 2019: policy-driven pops that fade, not a straight line higher.

The impact of macro policy is never instantaneous. Liquidity takes time to flow through money markets, credit channels, and risk assets. The narrative “QE = immediate bull run” ignores this transmission process and can lead investors to position themselves prematurely—buying at the moment optimism is peaking.

Understanding the delay between policy action and market response is key to avoiding the classic trap: pricing in the news long before it becomes reality.

In an environment where liquidity is scarce and slow-moving, risk assets demand greater patience, not blind optimism.