This week, on 12/18-19, the Japanese interest rate meeting will reveal whether Japan will raise interest rates. Basically, there is a high chance that Japan will raise rates, but will raising rates necessarily cause the market to crash? I am actually skeptical. It should only be under pressure in the short term. In the long term, it still depends on whether problems can be resolved through monetary policy adjustment.
For example, Japan raising interest rates may raise concerns about global capital fleeing from yen arbitrage, putting pressure on risky assets. This viewpoint is certain, but since Japan's negative interest rate in 2024, now at 0.5%, and possibly reaching 0.75% after multiple rate hikes, compared to the Plaza Accord when Japanese interest rates fell from around 5% to about 2.5%, there is still room for rate increases. Moreover, Japanese stocks have continued to rise during the rate hike phase from 2024 to now, and the impact of several rate hikes on capital flight has been decreasing each time.
Furthermore, this month the U.S. lowered interest rates. Initially thought to only stop the balance sheet reduction, it turned out to increase bond purchases by 40 billion per month. Is this also a precautionary measure for market liquidity? In fact, various events have probabilities of occurrence; the key point is whether the risks are controllable or uncontrollable. Regardless of interest rates, QT, QE, etc., these are all tools aimed at addressing current investment environment issues, and the market will ultimately reveal the answer. Investment is a long-term planning process, not a short-term speculative reaction. If investors maintain this mindset, it will be easier to make money. This is a personal opinion,#$WBETH ,$BNSOL $BTC
