Why Bitcoin WILL breakout uncontrollably amidst FED Unlimited Liquidity Stimulus – BTC Only Markets
Bitcoin soars amid announcement of change in US economic strategy
U.S. to update economic strategy for the first time amid ongoing coronavirus pandemic
The regulator intends to review the updated strategy every five years
Gold proponent Peter Schiff called the size of the US economic bubble “catastrophic”
Bitcoin price has risen by more than $ 200 after the refusal of the US Federal Reserve to adhere to the economic strategy of the last thirty years
On Thursday, August 27, Chairman of the Board of Governors of the Federal Reserve System (FRS) Jerome Powell announced a new economic strategy under which the US Federal Reserve will allow inflation to exceed the previous target..
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“By narrowing our ability to support the economy by lowering interest rates, the lower bound increases the risks of declining employment and inflation,” Powell said..
Powell said the Federal Open Market Committee (FOMC) unanimously approved updates to the previously approved Long-Term Objectives and Monetary Strategy Plan..
Update, Federal Committee Will Allow Inflation To Rise Above The Fed’s 2% Target By Keeping Rates At A Lower Level.
Despite high unemployment rates, which recently hit a 50-year low of 3.5%, inflation remained below 2%.
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Reduced inflation during the coronavirus crisis could affect a significant drop in prices, which in turn will affect the consumer ability of Americans and harm the US economy.
“Many find it illogical that the Fed wants to raise inflation. However, inflation that is too low for a long time can pose serious risks to the economy, ”Powell said..
“Fed surrenders without a fight”
The head of the Fed also added that the regulator intends to conduct a “thorough public review of strategy”, tools and methods of information exchange in the field of monetary policy approximately every five years..
Against the background of the statement of the head of the Fed, the price of bitcoin almost immediately jumped by almost 3% from $ 11,270 to $ 11,570.
However, Bitcoin could not continue to grow for a long time and at the time of writing the material, the price of the BTC / USDT cryptocurrency is $ 11,423.
Equity markets grew along with bitcoin. The Dow Jones Industrial Average (DJIA) climbed 0.75% to 28,544.94, while the S&P 500 rose by 0.39% to 3,492.42 points.
Renowned bitcoin critic Peter Schiff has already criticized the Fed chairman’s speech, saying that the regulator’s decision is “that no one at the FOMC has the courage to fight it.”.
“The Fed’s economic bubble is so big that piercing it to fight inflation would be a disaster. Thus, the Fed surrenders without a fight, ”wrote Schiff on his Twitter page..
Mark van der Cheese, founder of blockchain-focused investment fund First Block Capital, interpreted Powell’s speech as a call to get rid of fiat currency.
“The way I see Powell’s speech is that anyone who has cash in US dollars should immediately invest in financial assets. The money printer will continue to work to “support the economy.” It will only support stocks, gold and bitcoin, “Cheese wrote..
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