Thread by @BuysideHustle

Important dynamic going on right now in the economy. Potentially big negative implications for high growth/risk assets.

Thread and brief history lesson ⬇️

Post COVID, we entered a period of the easiest monetary conditions in history.
1) @federalreserve cut rates to zero
2) Trillions of dollars were printed to support the ecnomy
3) Unemployment rates 🚀

Vaccine rollout in November 2020 guaranteed COVID would be a nothing burger within the next year.
1) Stocks surge to all time highs
2) Unemployment begins falling rapidly
3) Consumer confidence/retail spending hit all time highs

Surprisingly, @federalreserve has continued to keep rates at zero and print hundreds of billions a month even though the economy has entered into a massive V-shaped recovery

At this point, economy is running super hot with inflation reaching the highest levels in recent history and unemployment heading back to pre-COVID levels

Ask yourselves a simple question: Are financial conditions going to get easier or tighter from here given this dynamic?

I see no reason why financial conditions are going to get easier. Fed will likely reduce levels of quantitative easing and raise rates sooner than expected.

-> Bad for high duration / growth / risk assets like $QQQ #Bitcoin
-> Good for value

Longer term, I do not disagree that there could be a lot of potential for $BTC or some of these tech companies that trade at very high valuations.

But I balance that view with what is happening from a macro perspective and the setup no longer seems attractive near term.

Just my two cents.
@RaoulGMI @42macroDDale @gamesblazer06