Crypto Bulls Charge as Markets Soar—But the Fed Throws Shade

Crypto's back with a vengeance. Bitcoin knifes through resistance levels while altcoins party like it's 2021—but Jerome Powell's crew just won't stop raining on the parade.

When Lambos Fly Again

Retail traders are FOMO-ing into memecoins (again). Institutional money's piling into ETH ETFs. Meanwhile, the Fed's latest minutes read like a buzzkill roommate complaining about the noise.

Wall Street vs. Cypherpunks

Traditional finance types keep muttering about 'unsustainable valuations' between sips of their $8 oat milk lattes. Meanwhile, decentralized exchanges are processing more volume than some small countries' GDPs.

The punchline? This rally's either the start of something huge—or the setup for the most entertaining crash since Lehman Brothers. Place your bets.

Expectations of Fed Rate Cuts

Before the announcement of trade tariffs, there were strong expectations of a Federal Reserve interest rate cut in September. Yet, these probabilities have waned following President Trump’s re-imposition of rates in April, affecting trade negotiations. New inflation figures are set to release next Tuesday and Wednesday, adding to the volatility of the current market.

Austan Goolsbee, President of the Chicago Fed, has pointed out that the new rates announced by President TRUMP negatively impact inflation projections. He explained these higher rates hinder the path for interest rate cuts. His candid commentary may not be the news President Trump desires to hear.

In a recent interview, Goolsbee shared that suspended tariffs initially pointed the Fed towards rate reductions, but the reintroduced tariffs altered this course. On August 1, a 35% tax on Canada and a 50% tax on Brazil will be imposed, with approximately 20 other countries seeing rates from April enforced.

Fed’s Current Stance and Future Implications

Jerome Powell, the Fed chairman, consistently mentions the Fed is well-positioned to observe developments before acting, asserting that current rates are not excessively tight. While the Fed has maintained steady rates since December, there is growing concern over whether inflation will continue to fall.

Goolsbee stands out among Fed members, as he has advocated for an earlier interest rate reduction. While recent comments from Waller hinted at supporting rate cuts, Bowman remains uncertain. Despite past advocacy, Goolsbee now appears to retract his stance.

“Adding factors to the mix complicates answering if prices will rise or not.” – Goolsbee

With unemployment less severe than expected and inflation on the rise, elevated tariff rates effective August 1 are anticipated. The effective duty stands at 20%, leading many Fed members to propose holding off on rate cuts. The upcoming Fed meeting has a 95.3% likelihood of rates remaining unchanged, with a 61% expectation of a September rate cut.