Hutter is making a big talk: the Federal Reserve's policy logic is changing, and bitcoin will meet a new macro test

Global financial markets, or are at the start of a new monetary policy cycle。

On 25 June, the fourth edition of Hutter, Professor at the Shanghai School of Advanced Finance at Shanghai Transport University, a former Senior Economist of the Federal Reserve, was held on the theme " From Wall Street to Web3: How will the new Fed Chairman reshape the global financial markets? " , with systematic sharing around hot spots such as the evolution of the Federal Reserve ' s monetary policy paradigm, the global liquidity cycle, US equity and Bitcoin linkages, and digital asset regulation in the United States。

According to Hu Jian, understanding future market trends should not be limited to interest rate reductions or increases, but rather to whether the bottom paradigm of the Federal Reserve monetary policy is changing, which will be an important variable for global asset pricing in the coming years。

The change in the Federal Reserve's policy paradigm has been a major pusher in the last 18 years of the global stock market

According to Hu Jian, understanding the current global capital markets requires, first and foremost, understanding the fundamental changes in the monetary policy of the Federal Reserve following the 2008 financial crisis. He stated that the continued rise in the United States share and global venture assets over the past 18 years was not only a result of improved corporate profitability or technological innovation, but, more importantly, a change in the monetary policy paradigm of the Federal Reserve。

" After 2008, the U.S. stock and other financial markets, the bull market, in a significant part, was the result of the Federal Reserve changing the monetary policy paradigm and relying more on base currency issuances to regulate the supply of money. This paradigm switch has far-reaching implications, not only for US equity, but also for Web3 asset prices like bitcoin."

It was further explained that quantitative easing had not contributed significantly to long-term inflation, but had changed the distribution of the underlying currency in the financial system, with large amounts of liquidity eventually flowing to asset markets。

The new Federal Reserve Chairman or the promotion of a renewed shift in monetary policy

The new Federal Reserve Chairman, Kevin Walsh, who spoke of market concerns, argued that his greatest characteristic was a tendency to reduce balance sheet dependence, or to revert to an interest-rate instrument-based policy framework in the future。

" When the new President comes to power this year, it is clear that the paradigm will be changed. One of the most important things is the abbreviation, which is the decline in the supply of basic money."

However, in his view, the new policy would not move forward overnight. There was still considerable uncertainty about current geopolitical risks, energy prices and inflation trends, and the Fed needed to balance market stability, so the abbreviation would be more prudent. "The abbreviation rate will probably be restarted, but the rhythm is very important. If the rhythm is right, it will certainly have a huge negative effect."

Liquidity remains an important variable affecting bitcoin

With respect to the Web3 market, Hute indicated that Bitcoin was increasingly integrated into the global financial system and that its price performance was closely related to global liquidity. In the last decade in particular, Bitcoin prices were strongly and positively associated with the NASDAQ index, reaching a high of 77 per cent. In the long run, Bitcoin is driven by macro-factors similar to traditional technology units, such as liquidity。

He emphasized that the abbreviation did not mean that the cattle market would end immediately, but that the asset market would lose the liquidity support that had been consistently available for more than a decade。

“AS A SINGLE FACTOR, THE ABBREVIATION WOULD CERTAINLY BE DETRIMENTAL TO ANY ASSET MARKET, INCLUDING THE UNITED STATES SHARE AND ALSO TO BITCOIN. BUT IT IS NOT THE ONLY FACTOR, AND THE DEVELOPMENT OF AI, THE STRENGTH OF FUNDAMENTALS AND MARKET SENTIMENT MAY CONTINUE TO SUPPORT ASSET PRICES."

In his view, for investors, a longer-term focus on global liquidity changes was more justified than a daily focus on interest rate reduction expectations. "The mobility remains the shell. Among all the factors affecting asset prices, liquidity is clearly a particularly critical factor."

U.S. dollarization will accelerate Wall Street and Web3 integration

In response to the recent increase in the currencyization of United States shares, Hu Jian considered this to be an important manifestation of the deep integration of traditional finance with Web3。

"Boundary must be blurring. Now Wall Street is entering Web3 and Web3 is becoming increasingly associated with Wall Street, which is a inevitable trend."

He indicated that, in the short term, United States equity monetization might divert some of the encrypted market funds, but in the long run, its real significance was to facilitate access to the chain of markets for traditional capital。

HE ALSO CAUTIONED, HOWEVER, THAT RWA PROMOTED TRANSACTION EFFICIENCY RATHER THAN ASSET VALUE PER SE. " DON'T FANTASIZE ABOUT TURNING A ROTTEN ASSET INTO A GOOD ASSET BY PACKAGING IT THROUGH RWA. HIGH-QUALITY ASSETS ARE ALSO HIGH-QUALITY ASSETS, LOW-QUALITY ASSETS OR LOW-QUALITY ASSETS."

Digital asset legislation in the United States is a global model

Finally, Hutch also focused on interpreting the digital asset regulation legislation being advanced in the United States。

IN HIS VIEW, THE CLARTY BILL WOULD CERTAINLY BE PASSED AND WOULD PROBABLY BE ADOPTED THIS YEAR. HE STATED THAT THE INSTITUTION-BUILDING AROUND DIGITAL ASSETS IN THE UNITED STATES WOULD NOT ONLY MEAN FORMALIZING A GLOBAL DIGITAL FINANCE COMPETITION STRATEGY, BUT WOULD ALSO PROVIDE AN IMPORTANT REFERENCE FOR GLOBAL DIGITAL ASSET REGULATORY PRACTICES, INCLUDING IN CHINA。

According to Hu Jian, the future direction of digital finance is well established, with major global economies continuing to explore new paths to integrating digital assets with traditional finance, and the advancement of United States institution-building will further accelerate this process。

As a long-term knowledge-sharing component of the flash currency HTX, the Global Finance, Science and Technology, and Web3 authoritative experts have been continuously invited to engage in in-depth sharing around front-line issues such as macroeconomics, digital finance, AI and block chains to help global users build more systematic market awareness and seize long-term investment opportunities in a complex and volatile global financial environment。