Recently, the Fed's movements have made the market a bit restless. At the December FOMC meeting, three Fed officials voted against, marking the highest opposition record in the past six years. Among them, Cleveland Fed President Mester's stance is very clear - there is absolutely no need to cut interest rates at this time. Once this voice came out, the market's previous optimistic expectations for rate cuts were doused with a bucket of cold water.

Political pressure is also increasing. Trump publicly named four candidates for the Fed chair, clearly expressing his desire to see interest rates significantly lowered, even stating a target of 1%. The logic behind this is also understandable — the scale of US national debt has reached $37.7 trillion, and high interest rates mean paying huge interest on the debt every day. Estimates suggest that for every day the interest rate cut is delayed, the US has to pay an additional cost of about $1 billion in debt.

There are three issues currently on the table. First is the debt pressure, as the burden of government bond interest continues to increase in a high interest rate environment. Second is the dilemma between inflation and policy—if new tariff policies are introduced, it may drive up inflation, but if interest rates are lowered simultaneously to offset this, it could lead to a complex policy spiral. The third concern is regarding stock market liquidity, with some voices suggesting that there are warning signs of liquidity issues in the market.

The internal game within the Fed is also quite interesting. Hawkish individuals insist that the data is not sufficient to support a rate cut decision, and they each have their own logic for interpreting inflation data and unemployment data. This divergence is reflected in the market—currently, the futures market prices in only about a 21% probability of a rate cut in January. The yield curve in the bond market is also distorted, as investors adjust their risk hedging strategies.

From a certain perspective, this dispute over interest rate cuts is not merely a simple monetary policy issue; it involves a game of multiple dimensions, including the independence of the Fed, political pressure, and debt sustainability. The final decision of the Fed Chairman may gradually become clear in the next 60 days. Every meeting and every data report could become a trigger point for the market to reprice.

This process is equally important for the cryptocurrency market. The liquidity environment, interest rate expectations, and policy uncertainty are factors that can affect capital allocation choices. The key now is to see whether the Fed and the political level can ultimately find a balance.