Dalio: The Fed is in a Difficult Position, Should Not Cut Interest Rates, Warns of Consequences of "Inappropriate Rate Cuts"

By: blockbeats|2025/05/21 15:00:01
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Original Title: "Dalio: The Fed is in a Difficult Position, Should Not Cut Rates, Warns of Consequences of 'Inappropriate Rate Cuts'"
Original Author: He Hao, Wall Street News

On Tuesday, Ray Dalio, the founder of hedge fund Bridgewater, was asked about the possibility of the Fed cutting rates given the current economic situation in the U.S. In response, Dalio stated that the Fed is in a difficult position and should not cut rates. Dalio believes that the Fed should not cut rates at the moment, as rate cuts are not the appropriate monetary policy choice. He pointed out that the Fed is in a very challenging situation and needs to balance multiple factors. There is currently significant uncertainty and deteriorating market sentiment, but the real economy itself has not shown significant problems yet. Therefore, the Fed's situation is very tricky.

Dalio mentioned that from a longer-term perspective, political factors will impact future monetary policy. If a new Fed chair takes office, it is more likely to push for rate cuts because policymakers usually prefer economic stimulus. Additionally, as interest rates have a significant impact on debt servicing costs, and debt levels are currently so high, the pressure for rate cuts will also increase as rate cuts can ease debt burdens. Dalio pointed out that one person's debt is another person's asset. So the issue is that if rates are lowered, the return on assets will also decrease. So, how are rates lowered? There may be rate cuts, but ultimately, some form of intervention is needed to achieve this, and these intervention measures will weaken the currency's value, leading to a "currency value dilemma."

Dalio believes that if we imagine a future where monetary policy changes, taking into account the impact of midterm elections, it will be a very worrying period:

If the market sees, for example, a too aggressive or inappropriate rate cut measure, it could actually have a very negative impact on the bond market. Because doing so would push up long-term rates, steepen the yield curve, and could also lead to a depreciation of the dollar, an increase in gold prices, reflecting a dynamic where the market is fleeing the bond market because the value of money has become more important.

This week, heavyweight officials such as the Fed's number two and three have spoken out, hinting that rates may stay until at least September, with Atlanta Fed President Bostic expecting possibly only one rate cut this year. Investors currently see less than a 10% chance of a rate cut at the next FOMC meeting in June and expect only two rate cuts this year, each by 25 basis points, lower than the four rate cuts expected by the market at the end of April.

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On March 4, 2026, DDC Enterprise Limited (NYSE American: DDC) today announced preliminary, unaudited full-year financial performance for the year ended December 31, 2025. The company expects to achieve record revenue and record positive adjusted EBITDA, primarily driven by continued growth in its core consumer food business and overall margin improvement. The final audited financial report is expected to be released in mid-April 2026.


2025 Full-Year Financial Highlights


Revenue: Expected to be between $39 million and $41 million, reaching a new company high.


Organic Growth: Excluding the impact of the company's strategic contraction of its U.S. operations, core revenue is expected to grow 11% to 17% year over year.


Gross Profit Margin: Expected to be between 28% and 30%, reflecting continued operational efficiency improvements.


Adjusted EBITDA: The company expects to achieve a positive full-year result in 2025, a significant improvement from a $3.5 million loss in 2024, mainly due to rigorous cost controls and a higher-margin sales mix.


Core Consumer Food Business Performance


In 2025, DDC's core consumer food business maintained strong operational performance.


The company also disclosed Core Consumer Food Business Adjusted EBITDA, a metric that further excludes costs related to its Bitcoin reserve strategy and non-cash fair value adjustments related to its Bitcoin holdings from adjusted EBITDA to more accurately reflect the core business performance.


In 2025, Core Consumer Food Business Adjusted EBITDA is expected to be between $5.5 million and $6 million.


Bitcoin Reserve Update


In the first half of 2025, DDC initiated a long-term Bitcoin accumulation strategy, holding Bitcoin as its primary reserve asset.


As of December 31, 2025: The company holds 1,183 BTC.


As of February 28, 2026: Holdings increased to 2,118 BTC


Today's additional purchase of 65 BTC brings the company's total holdings to 2,183 BTC


DDC Founder, Chairman, and CEO Norma Chu stated, "We are proud to have closed 2025 with record revenue and positive adjusted EBITDA, demonstrating the steady growth of the company's consumer food business and the ongoing improvement in profitability. We are building a disciplined, growth-oriented food platform and strategically allocating capital to Bitcoin assets with a long-term view, aligning with our core beliefs. We believe that this dual-track model of 'Steady Consumer Business + Strategic Bitcoin Reserve' will help DDC create lasting long-term value for shareholders."


Adjusted EBITDA Definition
For the full year 2025, the company defines "Adjusted EBITDA" (a non-GAAP financial measure) as: Net income / (loss) excluding the following items:· Interest expense· Taxes· Foreign exchange gains/losses· Long-lived asset impairment· Depreciation and amortization· Non-cash fair value changes related to financial instruments (including Bitcoin holdings)· Stock-based compensation


About DDC Enterprise Limited


DDC Enterprise Limited (NYSE: DDC) is actively implementing its corporate Bitcoin Treasury strategy while continuing to strengthen its position as a leading global Asian food platform.


The company has established Bitcoin as a core reserve asset and is executing a prudent, long-oriented accumulation strategy. While expanding its portfolio of food brands, DDC is gradually becoming one of the public company pioneers in integrating Bitcoin into its corporate financial architecture.


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