Arthur Hayes argues new Fed liquidity tool “RMP” masks renewed money printing

Arthur Hayes, co-founder and erstwhile CEO of crypto speech BitMEX, argued successful a Substack effort published Friday that the Federal Reserve’s caller “reserve absorption purchases” (RMP) programme is efficaciously a rebranded signifier of quantitative easing.

Hayes argues that by buying short-term Treasury bills and recycling liquidity done wealth markets, the Fed is efficaciously financing authorities spending portion avoiding the governmental stigma of quantitative easing, adjacent arsenic officials framework the programme arsenic a method liquidity operation.

“The RMP is simply a thinly disguised mode for the Fed to currency the government’s checks. This is highly inflationary from some a fiscal and existent goods/services perspective,” helium wrote.

US Treasury issuance by maturity. Source: MacroMicro

Hayes said policies similar RMP grow fiat liquidity and, successful his view, favour scarce assets specified arsenic Bitcoin, golden and silver.

I emotion QE due to the fact that it means wealth printing, and thankfully I ain fiscal assets similar gold, gold/silver mining stocks, and Bitcoin that emergence faster than the gait of fiat wealth creation.

At the aforesaid time, helium warned that radical without assets are harmed, arsenic wealth instauration erodes purchasing power, weakens wages comparative to prices and shifts wealthiness toward plus holders.

“Unfortunately, successful the present and present for astir of humanity, wealth printing destroys their dignity arsenic productive humans,” helium wrote. “When the authorities intentionally debases the currency, it destroys the nexus betwixt vigor inputs and economical outputs.”

Related: Bitcoin rebounds connected Japan complaint hike arsenic Arthur Hayes sees dollar astatine 200 yen

Polymarket points to intermission aft December complaint cut

On Dec. 10, the Federal Open Market Committee (FOMC) cut involvement rates by 25 ground points and announced purchases of short-term Treasury securities, a determination Fed Chair Jerome Powell said was “solely for the intent of maintaining an ample proviso of reserves” and abstracted from the stance of monetary policy.

The Fed said the purchases would initially full astir $40 cardinal successful the archetypal period and could stay elevated for respective months to easiness near-term pressures successful wealth markets, peculiarly astir seasonal fluctuations specified arsenic taxation payments. 

Despite the involvement complaint chopped and the announcement of short-term Treasury purchases, analysts said mixed signals from Powell were apt to dampen a sustained Bitcoin rally until the rate-cutting rhythm resumes successful 2026.

The terms of Bitcoin was astir $92,695 connected Dec. 10, according to Yahoo Finance data. It is was trading astir $87,300 astatine clip of writing.

At the clip of writing, Polymarket traders were overwhelmingly pricing successful nary alteration to Fed argumentation successful January, with the probability of rates staying unchanged astatine astir 77%, portion likelihood of different 25 ground constituent chopped beryllium adjacent 21% and larger moves are viewed arsenic highly unlikely. 

Odds of Fed complaint chopped successful Jan. Source: Polymarket

Powell’s word is acceptable to expire successful May 2026. US President Donald Trump, who has publically pushed for the adjacent Fed seat to prosecute assertive involvement complaint cuts, is preparing to interrogation finalists to win him, with National Economic Council Director Kevin Hassett wide viewed arsenic the frontrunner.

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