Recently, watching the speeches of several Federal Reserve officials, there is a subtle feeling that whether to cut interest rates or not is no longer mainly an economic issue, but rather a concern that a small misstep might scare the market to death.

Lisa Cook was very straightforward this time, saying that private credit is growing too fast, hedge funds are playing too aggressively in the Treasury market, and AI is bouncing around in trading, all making the financial system appear more fragile than expected.

She even hinted that if asset prices suddenly collapse, she wouldn't be surprised at all.

Doesn't that sound alarming? Actually, it's a warning to the market: don't treat risks as air.

Harker was even more direct, continuing to oppose rate cuts.
The reason is simple: inflation hasn't stabilized, financial conditions are too loose, and you shouldn't take it lightly.

Now, if the Fed cuts rates, they might end up being the ones supporting the market, which could actually accelerate the buildup of risk.

Bostic also said that caution is needed (the most commonly used word by the Fed).
And Goolsbee is quite worried about a rate cut in December, with a key point being that inflation doesn't seem to be moving in a good direction.
In other words, we once thought the finish line was in sight, but now it suddenly seems the runway has extended further.

Overall, the attitude of these Fed officials has become quite clear: they are not afraid to cut rates, but they are afraid to do so lightly.

Why?
Because currently, the prices of various assets in the market are so high that even the Fed feels uneasy.
Once they loosen policy, will it directly ignite another round of market frenzy?
If the risk bubbles keep inflating, who will be responsible when they burst?

So, there's a subtle logic at play: the market wants to cut, the Fed fears cutting, the market fears falling, and the Fed fears you won't fall.

This is the real game.
Everyone fears the other losing control, everyone wants to maintain the illusion of stability.

But the reality is, asset prices are already at the top of the mountain. A slight change in sentiment could trigger a slide.
What the Fed is doing now is trying to slow down the descent and keep it steady, avoiding a misstep.

Ultimately, this is not about whether the economy is good or bad, but whether the Fed dares to let the market cool down.

From their current tone, they are increasingly reluctant to make reckless moves.
This also means that the upcoming volatility in global markets will only be bigger than you imagine, not smaller.

#美联储 #降息