Article source: Li's Perspective
Today (April 7th), we have encountered another Black Monday, with almost all global markets falling, not just the crypto market. People's panic emotions seem to be further fermenting, and the market is generally permeated with bearish sentiment.
Many people say: The market is completely doomed.
Trump says: I did this intentionally.
Powell says: Let's reconsider the interest rate cut.
Under such highly uncertain market conditions, risk aversion by large funds will become the primary task at hand. I just looked at the yield of the 10-year US Treasury bond, which has dropped to 3.88. As shown in the following figure.
This week is destined to continue to be a potentially volatile week, with many news points to pay attention to, such as (listing only the US side):
- April 9th, reciprocal tariffs officially take effect (Will trade negotiations ease?), House will hold hearings (proposed to promote crypto asset regulatory legislation)
- April 10th, unadjusted CPI year-on-year rate to be announced (market expected value is 2.6%), new Federal Reserve monetary policy meeting minutes
- April 11th, PPI year-on-year and month-on-month rates, one-year inflation rate initial value
As we always say, if you don't know what to do, the best action under such intense volatility is no action.
If you still have spare positions for long-term investment, and these funds will not affect your real life, then the upcoming decline is still an opportunity to gradually add positions (reserve) Bitcoin. In other words, for ordinary investors, steadily using core positions to continue accumulating more Bitcoin at low points remains a relatively stable and simple operational strategy.
Of course, this premise is that you still remain optimistic about the future opportunities in the crypto market. The above is just our perspective-taking, that is, what I would choose if I were currently in an empty position, just sharing a train of thought, not as investment advice.
Just this morning, a friend left a message backstage saying: I've been in the crypto for almost a year, persistently learning various crypto knowledge and making many trades on the chain. Now I've finally figured out what I should do next, but looking back, not only have profits disappeared, but my principal is almost completely lost. Now I want to sell but feel unwilling, want to buy but have no money, feeling very frustrated.
This might be the current state of many newcomers.
As a group friend described today: Last year on this day, Bitcoin was $66,000, almost reaching $70,000, and you were happy and expectant. Today this year, Bitcoin is $76,000, almost reaching $70,000, but you are desperate and afraid. Bitcoin is still that Bitcoin, you are still you, but the difference is that you can no longer be happy.
Most people, when first entering this field, if someone tells them to simply hold Bitcoin, they definitely won't do it. Because this seems boring and lacks high-multiple return opportunities. Only after experiencing 1-2 rounds of baptism will they seriously treat Bitcoin accumulation. I was the same myself, first buying Bitcoin in 2017 but only establishing my fixed investment strategy in 2019, with overall losses in between.
Back to the current market environment, after experiencing the staged peak in 2024, Bitcoin has dropped from around $109,000, and Altcoins have fallen even more miserably. Many people have once again experienced a roller coaster, watching returns gradually diminish or even become zero. Many are once again reflecting painfully, deciding what they would do differently if given another chance. But as we said in our previous article: As long as another big market comes, the market will always find a way to make you forget the past or continue to lose yourself.
They say the world is like a chessboard, ever-changing, but also that there's nothing new under the sun. Perhaps when the spear and shield coexist, there is no contradiction in itself.
Perhaps in a few years, looking back, the 2025 market will be very interesting, and the current market will likely be recorded in history. The next actions of the Federal Reserve may continue to draw a close to the current crisis.
Because the recent market has been boring, I haven't paid much attention to the fluctuations of my Bitcoin holdings. Besides daily outdoor sports and writing at home, I occasionally browse TikTok or video accounts for entertainment, and I discovered some interesting things.
For example: Domestic media and self-media have been posting videos of American citizens protesting against Trump/Musk these days. These videos look quite "spectacular", with massive crowds. The comments are mostly cursing Trump, calling him a complete fool.
For instance: A few days ago, an uninhabited small island (with only penguins) appeared on Trump's "reciprocal tariffs" list, which many media and self-media made videos mocking, saying Trump is taxing "Penguin Island", which is outrageous. Moreover, the data in Trump's tariff table seems to be numbers directly pulled in Excel by an intern, and many comments say Trump's team is clearly a makeshift operation.
This is why I usually don't like reading such news and comments. Many pushed contents are too subjective, and comment sections are extremely impetuous, lacking basic verification or thinking, with many comments being completely baseless. I don't know why TikTok doesn't push me more videos of beautiful long-legged women, but instead pushes these "positive energy" anti-American videos.
Of course, I'm definitely not trying to defend Trump. Honestly, from my perspective, I also dislike Trump. The more I "liked" him before he took office, the more I "hate" him now. But as we mentioned in previous articles, objectively, Trump is a successful businessman and a successful politician. He has people like Musk, a billionaire-level successful businessman, and many smart people around him. If you think Trump is a fool and his team is incompetent, then why don't you, as a "smart" person, become a president or global billionaire?
When looking at any issue, we should try to be objective and do more analysis, and even consider perspective-taking for necessary thinking. This helps our rational judgment. This is also a good exercise for our investment thinking. Judgments can be right or wrong, but we need to avoid making completely subjective judgments right from the start.
Let's continue discussing the above example. Why are American citizens protesting (some reports say 20,000 people participated, others say over 300,000 protesters might participate - I'm too lazy to check the exact numbers, not very interested in specific figures)?
Some domestic media reports say the protests are to resist Trump's tariff policy. Some mainstream media say Trump is shooting himself in the foot, and facing US bullying, China has first demonstrated strategic patience and wisdom, and that Trump's antagonism towards the world will not end well.
After consulting some foreign media about ChatGPT, the reasons for this protest seem to be mainly focused on issues related to the democratic system, such as restrictions on abortion rights, immigration policies, and limitations on transgender rights. In other words, while tariff issues are also one of the reasons for the protest (after all, eggs in US supermarkets have become more expensive), Americans seem to be more concerned about issues related to the democratic system.
So, why did Trump become a president that people don't like after officially taking office?
This issue was actually mentioned in our previous related articles. The core problem seems to be the US debt problem, in plain words, the US government is indeed out of money, and since Trump is in charge, he needs to solve the basic living expenses.
To solve this problem, the more direct methods currently include:
- Have the Federal Reserve lower interest rates (reduce interest rates to alleviate debt pressure)
- Reduce some government-related expenses
- Collect more taxes to subsidize expenditure pressure
- Other methods (such as a $5 million immigration gold card)
The first method currently seems to be something Powell is "not giving face to". The second method is something Trump has been promoting, such as what Musk did after taking office, but it seems to face significant resistance. The third option, continuing to address the tax issue as an emergency, also seems to be a choice, although this comes with considerable risks that could lead to potential economic problems or other issues (such as a US stock market crash or global tensions), but there doesn't seem to be a better or faster way to make money right now.
I just quickly checked the data. The total federal tax revenue for the 2024 fiscal year is about $4.9 trillion, mainly consisting of the following components:
- Individual income tax of about $2.4 trillion
- Social insurance and retirement tax of about $1.7 trillion
- Corporate income tax of about $530 billion
- Other income of about $253 billion
However, the budget deficit for the 2024 fiscal year has already reached $1.8 trillion, with total expenditures of about $6.75 trillion. According to the latest data from the CBO (Congressional Budget Office), the budget deficit for the 2025 fiscal year will reach $1.865 trillion. At the same time, nearly $3 trillion in US debt will mature in 2025.
An important issue here is quite clear: the US has the world's most profitable companies (such as Apple and other large enterprises), but these large companies "almost" do not pay taxes.
Here's a simple example: if the production cost of an Apple phone in China is $300, to avoid taxes, Apple would first sell the phone produced in China to its Irish subsidiary for $700, then export it to a company in the Netherlands (a tax haven), which might also be registered in Ireland, and then export it to the US mainland, selling it to American consumers at a market price of $750. This way, although Apple's profit on the phone in the US is only $50, $400 of profit has actually been perfectly transferred in advance without paying US taxes.
Of course, the above is just a simple example, and the actual operation process would be more complex.
At this point, we should understand Trump's difficulties. Government expenses are huge, but when facing those extremely wealthy corporate giants, they can't collect "a single penny" in taxes because these large companies always have a thousand ways to perfectly avoid the US tax system (large companies in other countries are similar, with many well-known companies registered on small islands).
If Trump directly confronts these corporate giants for money, he would probably not know how he might die. Therefore, Trump is more willing to achieve his goals by targeting other countries (targeting other countries at least won't get him assassinated). For example, implementing a comprehensive "reciprocal tariff" policy seems to be a method where, no matter where these companies are registered, even if it's on a small island with only penguins, they must pay at least 10% tax.
If the above scenario is true, the corporate giants should also understand Trump's "calculation", but no one wants to directly tear each other apart at home.
However, these are just our speculations. As for what Trump (and his think tank) are thinking and what new things they will do next, no one can know. Whether it's Bitcoin, gold, or US stocks, the market seems to be completely controlled by Trump's policies. Now it seems everyone is waiting for the Federal Reserve's next move, which will be left to time to verify.
In reality, the social world is like this: the rich fight each other for their own interests or positions, and those who ultimately get hurt are often the poor (ordinary people).
In any case, we may face even greater storms ahead, but after the storm, there will still be a chance to see a new rainbow. The key is whether you can "survive" relatively intact until then. The market has reached its most difficult moment, but market opportunities are often created through falls. You must strictly manage your positions, strictly follow your trading discipline, continue to be patient, don't get overly excited by sudden rises, and don't panic because of sudden drops. Always face short-term market fluctuations with your "most comfortable" position.
