Arthur Hayes, former CEO of BitMEX, whose writings are eagerly read by the crypto world, stated that the expectation of an increase in cryptocurrencies continues. In his latest blog post, Hayes, who talked about his summer and winter holidays in the northern and southern hemispheres, combined his diet here with cryptocurrency comments.

“The market requires “real food” in the form of printed money…”

Hayes, who said that during the winter holidays he sometimes took chocolate-style foods loaded with sugar because he needed quick energy, likened the Fed’s experience to “the intense feeling of hunger that comes after the feeling of satiety after taking sugar”.

“The Fed rate cut sugar high might be short-lived if traders resume unwinding dollar-yen carry trade positions if the yen surges in value. Doing more rate cuts to stop the fall in various financial markets will only accelerate the pace of the narrowing of the dollar-yen interest rate differential, which in turn will strengthen the yen and cause more positions to be unwound. The market requires “real food” in the form of printed money supplied by a rising Fed balance sheet to staunch the bleeding.”

“The money printing will work”

Referring to the fact that some experts cited the fall in prices during the past interest rate cut periods, Hayes used the following statements:

“Some cite the decline in stock markets after Fed rate cuts as an example. Others say that interest rate cuts have led to a recession both in the US and in developing countries. That may be true, but if interest rates are cut when inflation is above expectations, and growth is strong, imagine what they will do when a recession actually comes… They will start the money printing machine and increase the money supply enormously. This will cause inflation. It will even be unfavourable for some businesses and assets. For assets with limited supply, such as Bitcoin, it will provide huge rises.”