Pro Bitcoin (BTC) analyst Timothy Peterson gave an impressive assessment of the Fed’s monetary policy and market outlook.
Peterson argued that maintaining interest rates at current levels would not solve structural problems and would instead cause the economy to suffer even more.
According to Peterson, the major economic index (LEI) has fallen by more than 5% before all recessions over the past 50 years, with the Fed reducing interest rates every time. However, despite LEI, which has experienced a historic decline between 2022 and 2025, the Fed has not yet cut interest rates. Analysts have described this as an abnormality, saying, “There is a recession in this cycle, but the National Bureau of Economic Research (NBER) has not officially declared it.”
Peterson said that Russia’s invasion of Ukraine in 2022 caused disruption in global trade and supply chains, creating supply shocks for energy, food and important minerals. Analysts stress that these structural problems cannot be solved with high interest rates, commenting that “as long as interest rates are high, growth will be further reduced, unemployment will increase and consumption will be curbed.”
Peterson argued that the Fed’s fight against inflation fails, saying, “The underlying cause of inflation is supply constraints. The Fed’s tools cannot solve this problem. What’s more, consumers are debt, revenue growth is slow and food prices remain high.”
Analysts also said the stock market is not as strong as expected. “The majority of the S&P 500 rise comes from just a few high-tech companies,” Peterson said. “This suggests that it’s not a wider gathering.”
Peterson argued that on current terms, investors should look to what he describes as “hard assets” to protect their portfolio.
“The Fed cannot solve structural problems. The global supply chain is broken, and governments are spending excessively. Inflation is inevitable. Gold and Bitcoin must be at the core of your portfolio if you want to survive.”
*This is not investment advice.