Latest / The Paul Barron Crypto Show / Jerome Powell Signals Rate Cut?🔥Crypto Market Update

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Jerome Powell Signals Rate Cut?🔥Crypto Market Update · The Paul Barron Crypto Show

• 0:06
  Speaker 1: Could the FED rate cut come in much sooner? Today
• 0:08
  Speaker 1: we'll break it down for you. A lot of things
• 0:10
  Speaker 1: are giving us indications that we may see some waffling
• 0:13
  Speaker 1: on the FED. I'll break it down. My name is
• 0:14
  Speaker 1: Paul Barrel. Welcome back in the tech path. I want
• 0:16
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• 0:52
  Speaker 1: One thing I want to get into today is, of course,
• 0:54
  Speaker 1: the Federal Reserves. Annual monetary are the semi annual Monetary
• 0:58
  Speaker 1: Policy Report and hearing, and the clips I'm going to
• 1:01
  Speaker 1: play for you today are breaking down how chair Pal
• 1:05
  Speaker 1: dealt with a lot of the questions that came in
• 1:07
  Speaker 1: on this. Now many people are looking at this statement
• 1:10
  Speaker 1: right here, which is probably the statement of the day,
• 1:13
  Speaker 1: and it's one that has been I feel a little
• 1:16
  Speaker 1: bit anticipated when I've been looking at this for a while,
• 1:19
  Speaker 1: and it's interesting that he's starting, I feel like there's
• 1:22
  Speaker 1: a crack in the armor, and that was that he
• 1:24
  Speaker 1: is saying that future trade deals, this is trade deals
• 1:28
  Speaker 1: may allow the Federal Reserve to cut interest rates. Now,
• 1:30
  Speaker 1: we still potentially will have lowering inflation, we still possibly
• 1:35
  Speaker 1: could have a strengthen jobs, and we've got what could
• 1:38
  Speaker 1: be a global macro dissolve of a lot of tensions.
• 1:43
  Speaker 1: So there are a lot of positive things trending right
• 1:47
  Speaker 1: now for the Fed to look at. Now, this first
• 1:49
  Speaker 1: clip is getting into how tariffs were involved. Take a look.
• 1:54
  Speaker 2: If not for if you just look at the basic
• 1:57
  Speaker 2: data and don't look at the forecast, you would say
• 2:00
  Speaker 2: that we would have continued cutting. The difference, of course,
• 2:03
  Speaker 2: is at this time all forecasters are expecting pretty soon
• 2:08
  Speaker 2: that some significant inflation will show up from tariffs now,
• 2:13
  Speaker 2: and you know, we can't just ignore that, but we're not.
• 2:16
  Speaker 2: We're just saying let's wait and see more. That's all
• 2:18
  Speaker 2: we're doing. And if you will have noticed, a substantial
• 2:21
  Speaker 2: majority of the Committee has written down great cuts in
• 2:24
  Speaker 2: the in the remaining four years for meetings this year.
• 2:28
  Speaker 2: So it's just a question of being prudent and careful
• 2:31
  Speaker 2: and but at a time when the labor market is
• 2:33
  Speaker 2: still strong. We don't see weakness in the labor market.
• 2:36
  Speaker 2: If we did, that would change things. You know, we're
• 2:39
  Speaker 2: going to continue to adapt as the data adapt. But
• 2:42
  Speaker 2: that is the difference between then and now.
• 2:45
  Speaker 1: Well, the thing that you have to consider is this
• 2:48
  Speaker 1: wait and see more. We broke this down earlier in
• 2:50
  Speaker 1: the week, is that the data that Palell is looking
• 2:52
  Speaker 1: at in most cases, well in all cases, is already dated.
• 2:55
  Speaker 1: So the issue is that they're not looking at the
• 2:58
  Speaker 1: right data that is more time. If you also consider
• 3:02
  Speaker 1: trade deals and inflation and how what we could see
• 3:06
  Speaker 1: as tariffs playing into this, you kind of have to
• 3:08
  Speaker 1: look at the countries that are coming in to potentially
• 3:10
  Speaker 1: trade deals. This is before July. That's in just like
• 3:13
  Speaker 1: three days, guys, So the likelihood of July. Remember the
• 3:16
  Speaker 1: next FOMC meeting is at the end of July's I
• 3:20
  Speaker 1: think it's July thirtieth. The last day, So that is
• 3:23
  Speaker 1: a long time between now and then for a lot
• 3:27
  Speaker 1: of deals to be underway. And remember that Trump and
• 3:30
  Speaker 1: his negotiation tactics have always been very bombastic. It moves markets,
• 3:35
  Speaker 1: it gets a lot of pressure off, and then eventually
• 3:37
  Speaker 1: it comes through, and maybe not in the exact point,
• 3:40
  Speaker 1: but it ends up coming through and you know, it resolves.
• 3:42
  Speaker 1: So that is one consideration that maybe they are looking at. Now.
• 3:47
  Speaker 1: One thing that you have to kind of compare against
• 3:48
  Speaker 1: is where's the housing market? Because the housing market is
• 3:51
  Speaker 1: one of the big categories that could take a major
• 3:54
  Speaker 1: hit here and here's Cardon talking about this. Fairchair should resign.
• 3:58
  Speaker 1: No inflation continues to punished in the American middle class.
• 4:01
  Speaker 1: This of course is all built on mortgage rates, and
• 4:03
  Speaker 1: this of course hurts the real estate market. I'll explain why.
• 4:06
  Speaker 1: But right now, when you don't have rates declining, you
• 4:10
  Speaker 1: have things like this going on, and that is a
• 4:13
  Speaker 1: complete flip on sellers versus buyers. And this is a
• 4:17
  Speaker 1: problem for the seller's market right now. If you are
• 4:21
  Speaker 1: in real estate, this is a massive hit and could
• 4:25
  Speaker 1: create a huge economic pressure on the marketplace. And of
• 4:29
  Speaker 1: course this gets into other things. There's a lot of
• 4:31
  Speaker 1: people's net worth are tied up in their house. So
• 4:34
  Speaker 1: think about how this plays out if we continue to
• 4:36
  Speaker 1: see interest rates holding at the position that they are.
• 4:40
  Speaker 1: And remember, it's interesting that the fifty basis points, which
• 4:43
  Speaker 1: was a surprise last fall, came at a time right
• 4:47
  Speaker 1: before an election and right before we see a new
• 4:52
  Speaker 1: president take office, and then all of a sudden, the
• 4:56
  Speaker 1: Fed becomes so resilient and so worried about all of
• 4:59
  Speaker 1: these scenarios that they continue to hold on these rates
• 5:03
  Speaker 1: higher for longer. These are the kind of things that
• 5:05
  Speaker 1: I think the market is starting to get fed up with.
• 5:08
  Speaker 1: Morgan Stanley though, coming in saying that they're expecting to
• 5:11
  Speaker 1: see a lot. Can you imagine seven rate cuts that
• 5:13
  Speaker 1: you have to remember, guys, they were the same group
• 5:17
  Speaker 1: they called for five rate cuts this year. Okay, just
• 5:19
  Speaker 1: so we remember last year Morgan Stanley and many others
• 5:22
  Speaker 1: JP Morgan five rate cuts this year. That is the
• 5:25
  Speaker 1: kind of thing that but I believe we are in
• 5:27
  Speaker 1: for ray cuts this year. Question is how quickly and
• 5:30
  Speaker 1: how fast do they come. Other things you've got to
• 5:33
  Speaker 1: look at is the rest of the global banks. Swiss
• 5:36
  Speaker 1: National Bank race twenty five basis points, Bank of Japan
• 5:40
  Speaker 1: fifty Bank of England four to five following a twenty
• 5:44
  Speaker 1: five basis cut in May Norway point B is every
• 5:47
  Speaker 1: buying everybody out there in terms of the central banks
• 5:52
  Speaker 1: are cutting rates and there's very clear indications as to why.
• 5:56
  Speaker 1: And this is mostly for economic preservation, which is the
• 5:59
  Speaker 1: biggest challenge that I think a lot of the market
• 6:01
  Speaker 1: is pushing into. This was an interesting move because the
• 6:05
  Speaker 1: percentage of a July thirty rate cut doubled from what
• 6:10
  Speaker 1: was just a little bit ago down around almost nothing
• 6:14
  Speaker 1: to where we are right now at twenty four percent
• 6:17
  Speaker 1: on a quarter basis points. So is this trending now
• 6:21
  Speaker 1: based on what we're seeing? Remember this is just the
• 6:23
  Speaker 1: first day of Palell's cracking the armor. Could we start
• 6:27
  Speaker 1: to see these things pile up going forward? I want
• 6:30
  Speaker 1: to go to another clip right here. This, of course,
• 6:32
  Speaker 1: is Jeddie Vance piling in on pal saying, I'd love
• 6:36
  Speaker 1: to hear your argument why Pole cut raise fifty paces
• 6:38
  Speaker 1: points right before the election? But can do it now
• 6:40
  Speaker 1: with inflation that's lower. These are the kind of things
• 6:43
  Speaker 1: that are starting to compile, and these are the kind
• 6:44
  Speaker 1: of things that I think are putting pressure on Pal
• 6:47
  Speaker 1: for maybe the first time. Let's go into another clip,
• 6:50
  Speaker 1: because this is moreno getting into it in a heavy way,
• 6:54
  Speaker 1: on Palell, listen to.
• 6:55
  Speaker 3: This, and it says the Federal Reserve plays no role
• 6:59
  Speaker 3: in commenting on trade policy. So you don't comment on
• 7:03
  Speaker 3: supply shops. You don't comment on tax policy, which clearly
• 7:07
  Speaker 3: affects inflation. You don't comment on the demand point. You
• 7:10
  Speaker 3: just said now that we should forgive student debt. Why
• 7:14
  Speaker 3: is a person that goes to Harvard because a gender
• 7:17
  Speaker 3: studies major pays Harvard obscene amounts of Moody because professors
• 7:21
  Speaker 3: are grossly overpaid. There is that person better than a
• 7:24
  Speaker 3: working class Ohio and that is a plumber, but can't
• 7:27
  Speaker 3: afford a car because interest rates are too high. Car
• 7:30
  Speaker 3: prices have gone up. This is car prices. This is
• 7:33
  Speaker 3: car prices. Since this year, car prices are down. Car
• 7:39
  Speaker 3: prices are down. Inflation in America is down. We got
• 7:43
  Speaker 3: elected by millions of voters. You got elected by one person.
• 7:46
  Speaker 3: He doesn't want you to be in that job. And
• 7:49
  Speaker 3: you are costing this government four hundred billion dollars a
• 7:52
  Speaker 3: year by refusing to lower interest rates. Nobody in this
• 7:55
  Speaker 3: chamber has that kind of power to have a four
• 7:57
  Speaker 3: hundred billion dollar impact on this economy, on our deficit,
• 8:01
  Speaker 3: and I just think that you should consider whether you're
• 8:04
  Speaker 3: really looking at this from a fiscal lens or a
• 8:06
  Speaker 3: political lens, because you just don't like tariffs.
• 8:09
  Speaker 1: All right. So there you have it again, more pressure,
• 8:12
  Speaker 1: a lot of data that's coming at PAL. Clearly we're
• 8:15
  Speaker 1: seeing the impact now automotive, real estate. Now what we'll
• 8:19
  Speaker 1: most likely see in coming next, I think is going
• 8:21
  Speaker 1: to be retail sales as we start to see the
• 8:24
  Speaker 1: pressure of these high interest rates. Here's a clip of
• 8:27
  Speaker 1: Trump trying to interview new candidates. They're talking about it anyway.
• 8:31
  Speaker 1: Take a look.
• 8:32
  Speaker 4: You are criticizing the Federal Reserve chair before coming to
• 8:36
  Speaker 4: this summit. I think he's terrible.
• 8:38
  Speaker 2: I was wondering if you've begun interviewing different candidates for
• 8:42
  Speaker 2: the Fed pick.
• 8:42
  Speaker 4: Yeah, I know within three or four people who are
• 8:46
  Speaker 4: going to pick. I mean, he goes out pretty soon, unfortunately,
• 8:48
  Speaker 4: because I think he's terrible. We have no inflation, We
• 8:52
  Speaker 4: have a tremendous economy. Hundreds of billions of dollars of
• 8:56
  Speaker 4: tariff money is pouring in. Factories are being built because
• 8:59
  Speaker 4: they don't want to pay the tariffs, so they're building
• 9:01
  Speaker 4: them all over the country. I think what last to
• 9:04
  Speaker 4: fifteen trillion dollars I told you five point one trillion
• 9:07
  Speaker 4: from the Middle East alone, but of investment money coming
• 9:10
  Speaker 4: and there's never been anything like that in the history
• 9:12
  Speaker 4: of our country. But we have no inflation, and we
• 9:16
  Speaker 4: have borring because Biden stupidly they did short term dead.
• 9:20
  Speaker 4: So we have borring coming up. And you know, we'll
• 9:23
  Speaker 4: go ten years, maybe longer, maybe short, but we'll go
• 9:26
  Speaker 4: a long period of time when we do the dead
• 9:27
  Speaker 4: and because of him, because of this guy, we will
• 9:32
  Speaker 4: have to pay four years, we'll be paying for him.
• 9:35
  Speaker 4: I said, if there's inflation in two years or three
• 9:39
  Speaker 4: years or one year from now, you raise the rate
• 9:41
  Speaker 4: and you take care of the inflation among other things.
• 9:44
  Speaker 1: All right, So one point that obviously Trump is getting
• 9:46
  Speaker 1: at is that maybe there's a way around this if
• 9:49
  Speaker 1: in fact that the FED is concerned about another increase
• 9:55
  Speaker 1: in inflation, that okay, you raise rates again and deal
• 9:58
  Speaker 1: with that. And I get it. Yeah, there's yo yo effect.
• 10:00
  Speaker 1: But if you look at all of the contributing factors
• 10:03
  Speaker 1: of the economy, where we're seeing major markets including real estate, cars,
• 10:07
  Speaker 1: et cetera playing into this. Yeah, I think that is
• 10:09
  Speaker 1: something to consider because at some point an economy can
• 10:12
  Speaker 1: be hurt and puts basically into a death spiral where
• 10:16
  Speaker 1: it cannot recoil. So those are the things that you
• 10:19
  Speaker 1: have to kind of consider. US Treasury has posted a
• 10:22
  Speaker 1: three hundred and sixteen billion dollars budget deficit in May.
• 10:25
  Speaker 1: This is something to keep an eye on because this
• 10:27
  Speaker 1: is something that we thought that tariffs would have at
• 10:30
  Speaker 1: least some sort of dent. So far, realization of that
• 10:34
  Speaker 1: has not occurred. Now, granted, could something in the cycle
• 10:37
  Speaker 1: of throughput in terms of tariffs start to play into this,
• 10:41
  Speaker 1: especially if we get more deals done, Yes it could,
• 10:44
  Speaker 1: But so far, deficit still a problem, and the deficit
• 10:47
  Speaker 1: spending crisis is definitely worsening, so that only puts more
• 10:51
  Speaker 1: pressure on Powell. In general. Stable coins also could grow
• 10:55
  Speaker 1: into about a three point seven try this come from
• 10:57
  Speaker 1: Scott bessnt market by the end of the decade. Three
• 11:00
  Speaker 1: point seven trillion, I believe is low. We could see this.
• 11:04
  Speaker 1: I'm expecting over five trillion in the essence of what
• 11:07
  Speaker 1: we will see around the growth and retail sales. The
• 11:11
  Speaker 1: use case of banks entering the market and the competitive
• 11:14
  Speaker 1: natures of a lot of these neobanks and exchanges, brokerages,
• 11:18
  Speaker 1: et cetera, all playing in to a new ecosystem around
• 11:22
  Speaker 1: stable coins. And of course that means that there's a
• 11:24
  Speaker 1: lot of new demand that could lower government bar and
• 11:27
  Speaker 1: costs and also help bring in national debt. That would
• 11:29
  Speaker 1: be another benefit from this. And of course these are
• 11:32
  Speaker 1: the kind of things that we're facing right now in
• 11:34
  Speaker 1: the market. I want to go to this last actually,
• 11:37
  Speaker 1: this next clip that plays into the stable coin bill
• 11:41
  Speaker 1: and its position in the marketplace. By Chair Pile, take a.
• 11:44
  Speaker 5: Look what has changed about the risk of stable coins
• 11:49
  Speaker 5: since the Board adopted its policy in twenty twenty three,
• 11:54
  Speaker 5: and now that the Congress has weighed in at least
• 11:59
  Speaker 5: the Senate is swayed in and sent the Genius Act
• 12:02
  Speaker 5: to the House.
• 12:03
  Speaker 2: So I think what has changed is if you go back,
• 12:06
  Speaker 2: that's a couple of years ago. That was the period
• 12:09
  Speaker 2: of high profile failures and fraud and that kind of thing.
• 12:13
  Speaker 2: And what's happened is, I think, you know, the industry
• 12:17
  Speaker 2: is maturing, our understanding of it is improving, and in
• 12:20
  Speaker 2: a sense, it's becoming much more mainstream. So all of
• 12:25
  Speaker 2: us are revisiting you know, the things that were done
• 12:28
  Speaker 2: during that era, and you know, I think the current
• 12:32
  Speaker 2: view is that you know that it's appropriate for I mean,
• 12:37
  Speaker 2: it's always been appropriate for banks to choose their customers
• 12:39
  Speaker 2: and to be able to undertake activities as long as
• 12:41
  Speaker 2: they're safe and sound.
• 12:43
  Speaker 1: All right, So point being that Chair Pal seems to
• 12:47
  Speaker 1: be coming in line with where stable corn growth is
• 12:49
  Speaker 1: going to be coming from. This will have an effect
• 12:51
  Speaker 1: on not only growth in the economy, but also I
• 12:55
  Speaker 1: think in general we're going to see inflation also be
• 12:57
  Speaker 1: addressed by this, mainly because you are to see a
• 13:00
  Speaker 1: lot of use cases where it starts to reduce fees,
• 13:03
  Speaker 1: et cetera in the financial system. One other thing to
• 13:05
  Speaker 1: consider is how the tax bill will play into this,
• 13:08
  Speaker 1: because remember these are all strategic moves that it's the
• 13:11
  Speaker 1: timing that is most interesting to me, and I'll explain
• 13:14
  Speaker 1: to what I'm talking about. But the Senate design their
• 13:16
  Speaker 1: vote by the end of the week, because the deadline
• 13:19
  Speaker 1: is now threatened in a recess. And this is a
• 13:21
  Speaker 1: statement right here by guess who mister Trump saying on
• 13:25
  Speaker 1: true social nobody goes on vacation till this thing's done.
• 13:29
  Speaker 1: So we're getting clarity coming out of the White House.
• 13:32
  Speaker 1: We're getting a lot of things that are positioning pressure
• 13:36
  Speaker 1: against Powell. All of this comes together at the same time. Timing.
• 13:40
  Speaker 1: As I said, timing is very intriguing here. Now, how
• 13:43
  Speaker 1: does this play out? Well, taxing bill, if the taxes
• 13:47
  Speaker 1: and Budget bill, if it passes, then that's done. If
• 13:50
  Speaker 1: the genius and the market structure bills get packaged in
• 13:53
  Speaker 1: that could be done in the next couple of weeks.
• 13:55
  Speaker 1: Then you have a teraror deal maybe that could be
• 13:57
  Speaker 1: landed between let's say India, and then you have the
• 14:02
  Speaker 1: FED coming in and saying, all right, maybe we will
• 14:04
  Speaker 1: start to give us a little room here for cutting rates.
• 14:08
  Speaker 1: My anticipation again is still looking at that July zone.
• 14:11
  Speaker 1: I know a lot of people are saying that's very aggressive,
• 14:14
  Speaker 1: but you got to think about this is July thirtieth.
• 14:17
  Speaker 1: Let's go in here. And this is my point. This
• 14:19
  Speaker 1: was a tweet I put out, actually I put it
• 14:20
  Speaker 1: out many days ago, but I kind of doubled down
• 14:22
  Speaker 1: on this point in this topic, and that is bullish
• 14:26
  Speaker 1: for July. Here's reason is that if you look at
• 14:28
  Speaker 1: all the timing here, and as I said, they presented
• 14:32
  Speaker 1: some very interesting facts here real estate, automotive, two major
• 14:36
  Speaker 1: markets in the United States. Then you look at what's
• 14:39
  Speaker 1: playing out right now for retail, which has not hit
• 14:42
  Speaker 1: right now. These are the dates that you have to
• 14:44
  Speaker 1: pay attention to. July twenty nine thirty that's the FOMC date.
• 14:47
  Speaker 1: Then you have the September date, which is mid September,
• 14:51
  Speaker 1: then October, and then December. Of course, if this doesn't
• 14:54
  Speaker 1: happen before September, retail is dead for the fall. And
• 15:00
  Speaker 1: that is the problem that we're going to start to
• 15:02
  Speaker 1: take a look at. And remember a lot of these
• 15:04
  Speaker 1: meetings are marked with these release of these economic projections
• 15:07
  Speaker 1: which are lagging datas. Again, all this plays into some
• 15:12
  Speaker 1: interesting time interesting that he cracked today in that hearing.
• 15:16
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