Author: Arthur Hayes; Translated by: Liam, Carbon Chain Value
Some of you are in a panic, but I like tariffs. Here are some charts to understand some deeper reasons behind my liking for tariffs. The global imbalance will be corrected, and the pain will be covered by money printing, which is a good thing for Bitcoin.
As foreigners sell off U.S. tech stocks and bring funds back home, the dollar is weakening. In the medium term, this is favorable for Bitcoin and gold.
We need China’s loose policies to allow domestic credit creation and to alleviate tariff pressure by devaluing the yuan to flow overseas. After imposing an effective tariff of 65%, China may allow the yuan to depreciate to above 8.00.
We need the Federal Reserve’s loose monetary policy. After the tariff announcement was released, the yield on 2-year Treasury bonds fell because the market tells us that the Federal Reserve will soon cut interest rates and may restart quantitative easing to counteract the negative impact on the economy.
We need the Bank of Japan to provide #yen liquidity. Why not respond to the new tariff rates by increasing quantitative easing, thereby implementing a weaker dollar-yen policy? I believe the dollar-yen will return to 160 or even higher.
Be patient, flexible, and fluid.
Yay!
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