By May next year, the interest rate cut trend must be completed.

In my opinion, there’s no longer any mystery about Powell's departure; the key is who will take over next and when the market will start to react. Treasury Secretary Mnuchin himself said he doesn’t want the job, so that basically rules him out. Currently, everyone is most optimistic about Hassett, and the reasons are quite obvious:

This person has a very clear stance, openly supports cryptocurrency, which is very important in the current environment; plus, he repeatedly says that the current data warrants further interest rate cuts, without ambiguity; and on top of that, he fundamentally shares the same economic thinking as Trump.

So the reasoning is straightforward: as long as the market feels Hassett is really going to take over, the current “hawkish” expectations from the Federal Reserve will be overturned immediately, and everyone will begin to price in “faster and earlier easing.” That’s why I always feel that continuing to cut rates in the second half of next year is not a matter of probability, but almost a certainty.

However, many people have misunderstood: cutting rates does not mean a constant flood of liquidity. The wave that truly relied on liquidity to push the market will likely be nearly finished by May next year. The subsequent rate cuts will be more about consolidating direction and providing market confidence, rather than opening the floodgates again.

In the first half of the year, the focus was on “whether expectations will loosen,” while in the second half, the focus will be on the valuation adjustments brought about by “political changes + policy implementation.” The market has always acted in advance; once it’s actually implemented, the trend may not move at all.

Brothers, the powerful coin that can yield a 10x profit is here. I am preparing for a big wave in the upcoming trend; this time, a successful all-in will definitely result in a bountiful harvest. I want to witness it in the chat room. #美联储降息