On the second anniversary of the US dollar interest rate hike, central banks around the world are waiting for news of a rate cut in dollars, but the attitude of the Americans is extremely confusing. What on earth are they waiting for?

The Federal Reserve has been flip-flopping between being hawkish and dovish. Is it really that they are capricious, or are they waiting for China to make a statement? In this matter, the Americans really need China's help, and there is another country that is also crucial.

While the attitude of the Federal Reserve is ambiguous, the European Central Bank is very clear. They are eager to cut interest rates.

On April 4th, the minutes of the European Central Bank meeting showed that inflation is expected to continue to decline in the coming months, making the first date for a rate cut more clearly visible.

The "big hawk" of the European Central Bank has also softened. On April 3rd local time, the hawkish member of the European Central Bank's governing council, Holzmann, stated that he is not fundamentally opposed to a rate cut in June, but he hopes that the Federal Reserve will follow suit, otherwise the effectiveness of its rate cut will be weakened.

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If the US cuts interest rates and Europe also cuts interest rates, central banks around the world will follow suit, and the era of global easing will come, allowing everyone to breathe a sigh of relief.

However, the US is on the verge of giving up but is still stubbornly insisting on not cutting interest rates. Why? What on earth do they want to do?

This round of US dollar interest rate hikes started in March 2022 and has been going on for two full years now, with a rate hike of 5.5 basis points, also the largest in history.

The US dollar interest rate hike is not just a matter for the Americans themselves, because the US dollar is the world's currency, and the Federal Reserve is equivalent to the world's central bank. Aggressive rate hikes have greatly contracted global liquidity.

In addition, the US dollar interest rate hike has led to a more serious consequence, which is to lead central banks around the world to raise interest rates, otherwise other currencies will depreciate against the US dollar, and it may collapse.Nonetheless, global currencies have depreciated against the US dollar, with almost no exceptions.

Americans are clearly aware of this outcome, hence conspiracy theories have emerged, suggesting that the US is set to reap the world's wealth. Unfortunately, regardless of whether this is the genuine intention of Americans or not, it is an undeniable fact.

The US dollar's interest rate hikes have also led to another consequence: a shortage of dollars, severely harming international trade and damaging the manufacturing industries of global production countries, including major producers like China, Germany, Japan, and South Korea, none of whom have been spared.

These facts are so clear that Americans cannot refute them, and in reality, they have not attempted to do so.

However, as we enter 2024 and the Americans are set to lower interest rates, the current situation leaves them dumbfounded.

This time, the situation surrounding the US dollar's rate cut is vastly different from the past, mainly in three aspects.

Firstly, domestically in the US, due to the high fiscal deficit and massive money printing since 2020, this has led to a hoarding of dollars and high inflation. After the dollar's interest rate hikes in 2022, even more dollars have returned to the US.

The current accumulation is terrifyingly large; the US finds it too hot to handle and fears losing control if it lets go. Once the interest rate cut is initiated, it might lead to an uncontrollable flood.

If, at this moment, certain countries take drastic measures to siphon off these funds, the consequences would be unimaginable. Not only could the US stock market collapse, but a commercial real estate crash and widespread bankruptcy of small and medium-sized banks in the US are also very likely.

Secondly, the current US debt crisis is severe, the petrodollar system is virtually defunct, and the dollar system faces the risk of collapse.The US dollar system is fragile. If interest rates are cut at this time, the dollar will plummet significantly. Should the US Dollar Index break below the critical point of 90, a global panic selling of dollars would ensue, accelerating the process of de-dollarization.

Thirdly, in the past, US interest rate hikes would burst a few countries' economies, followed by a rate cut, allowing US capital to have a clear target for harvesting. This time, however, there is none; everyone has held their ground, and US capital has lost its direction.

If US capital lacks a clear target for harvesting, it will flood towards economies with a solid foundation, good growth momentum, and larger economies. Currently, only two countries in the world meet these criteria: China and India.

The situation and the pattern have completely changed. If not handled well, it could lead to a reverse harvest. Therefore, the Americans are now holding a large basin of water, feeling panicked and at a loss.

However, not cutting interest rates is also not an option. Is there a solution? Of course, there is. In such a vast world, there's always a way to catch the falling water.

The Americans understand that to solve this dilemma, two things must be achieved.

The first thing is that when the US dollar interest rates are cut, everyone should refrain from snatching, allowing the dollar to flow freely, ideally benefiting everyone.

The second thing is that when the US dollar interest rates are cut, everyone should not be ruthless, showing mercy, and not causing the dollar to crash.

Given the Indian temperament, they are unlikely to pay attention to the Americans' approach and will probably take the opportunity to gain an advantage. They dare to resell Russian oil; what's a little dollar grabbing to them?

So the key lies in China. The Americans have heard that we have lent a large amount of US dollars and yuan, stabilizing the situation, which also means that our hidden strength is quite formidable.When the US dollar cuts interest rates, if we join forces with several countries to operate together, they are likely to end up in a bad situation.

The Americans want our help, but the past hurts are too deep, and now it's too late to pull back.

However, the US dollar still needs to cut interest rates, what should we do?

Therefore, US Treasury Secretary Yellen is here again. The old lady is also hardworking. First, she changed her friendly image from the past and threatened, then she set off with a worried look.

This trip, first go to Guangzhou, which is the manufacturing base and export frontier of China, to find out the details, find flaws, and negotiate terms.

In 2024, this big play will start.