Dear Investors,

A big macro event will shake the markets in less than two weeks.

Will it be a positive boost or a market correction based on fears of recession?

In This Letter

• The FOMC meeting is behind the corner.

• Money Markets - the 6.44 trillion cash.

• Is it time to panic?

The FOMC meeting is behind the corner.

The FOMC (Federal Open Market Committee) meeting is scheduled for the 18th of September.

And this one will be a big one.

The current interest rates are the highest since the dot com bubble (January 2021). That means it is expensive to borrow money (credit).

In theory, the lower the rates, the more money is in circulation (people borrow more), and the higher risky assets, such as stocks and crypto, can go.

According to estimates, there is a 100% probability the FED will lower interest rates, either by 25 bps or even 50 bps.

Also, the FED’s chairman, Jerome Powell, signaled in his speech that “the time has come” to cut interest rates.

That is a very good sign for the risky assets.

However…

Some analysts are worried that the 25 bps is already priced in risky assets, and if the Fed decides to cut rates by 50 bps, it will signal a recession and spook investors.

To sum it up,

• In the long term, this is great, as it starts the new liquidity cycle that will drive crypto to new highs.

• In the short term, expect sharp rises and declines as investors search for a clear signal that the economy is under control and expanding.

And how much money are we talking about?

Money Markets - the 6.44 trillion cash.