Forward Guidance The System Is Too Levered To Take Real Pain | Arthur Hayes
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Apr 23, 2025 
Arthur Hayes, co-founder of BitMEX and now chief investment officer at Maelstrom, dives into current economic dynamics. He discusses how Trump's concessions are shifting markets and the US-China trade tensions amidst high tariffs. Hayes highlights the decoupling of Bitcoin from US assets, exploring its role as a global liquidity tool. The conversation also covers monetary policy challenges, the Fed’s stance on quantitative easing, and the implications of the Supplementary Leverage Ratio on banking liquidity and crypto investments.
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Leverage Limits U.S. Tariff Pain
- Trump's maximal tariff stance strained U.S. markets, forcing quick policy concessions.
- The U.S. financial system's extreme leverage limits tolerance for such disruptions.
China's View on U.S. Tariffs
- China perceives aggressive U.S. tariffs as humiliating, affecting its domestic politics.
- Xi Jinping cannot concede to U.S. trade demands without losing face internally and regionally.
Trade Deficit Drives Bitcoin Decoupling
- Decreasing U.S. trade deficit means foreign investors sell U.S. stocks, forcing printing to offset fiscal shortfalls.
- Bitcoin benefits as it likely decouples from U.S. tech due to structural capital flow shifts.