Prediction Markets Don't Believe The Fed
Today’s letter is brought to you by Consensus 2024!Consensus 2024 is happening May 29-31 in Austin, Texas. This year marks the tenth annual Consensus, making it the largest and longest-running event dedicated to all sides of crypto, blockchain and Web3. Don’t miss Bitcoin: We Are So Back, where Anthony Pompliano will discuss what the next bull market will look like, how it will differ from previous run-ups and the broad macro investment thesis for bitcoin and crypto more broadly. Consensus has tailored programming for Bitcoin maxis and multi-chain mavericks alike, covering everything from post-halving strategies to mining and more. Plus, you absolutely won’t want to miss the epic BTC (Nic Carter) vs ETH (David Hoffman) battle at Karate Combat. That’s just a taste of what's to come at crypto’s only big-tent event. Join Consensus in Austin alongside 15,000+ investors, founders, brands and more to take in all that blockchain has to offer. Get your pass today and use code POMP to save 20%. To investors, The market continues to work overtime trying to figure out the Federal Reserve’s plan to cut interest rates. Optimism ruled the day as we entered 2024, including a belief that we would have majority of the Fed’s interest rate decisions lead to rate cuts before the year ended. Today the sentiment is very different. Rather than opine on the qualitative feelings of the market, we can look to the Kalshi prediction market for a quantitative read on how people are thinking about what should unfold related to interest rates. According to these prediction markets, we were set for 5 interest rate cuts in January, but that number has now fallen to under 2. Quite a fall in expectations in just 5 months. You can see that the most popular prediction now is a single rate cut in 2024. At the start of the year, the market predicted an interest rate cut by July was more than 90% likely. Today that percentage has fallen to 27%. These same markets think there is a 92% chance of no change to interest rates in the next meeting, but an 8% chance to cut at least 25 basis points and a 2% chance of a cut larger than 25 basis points. What about the crowd that thinks there is going to be another increase in the interest rate, rather than cuts on the horizon? Those people are in the minority according to prediction markets. If you wager $100,000 on an interest rate hike happening before the end of 2024, you stand to make ~$566,000 if you are correct. Finally, the prediction markets believe there is a 37% chance that we will see an interest rate below 5.25% this year, while there is a 33% chance below 5% interest rate and an 11% chance we see lower than 4.75%. Most people don’t think in terms of probabilities. However, it can be one of the best ways to navigate complex, unknown scenarios. These prediction markets are not crystal balls, but rather can show you a quantifiable measurement on how sentiment and market expectations is changing in real-time. I will keep seeking information on my journey to learn. Hopefully you find this valuable. Have a great weekend and I’ll talk to everyone on Monday. -Anthony Pompliano Hannah Maruyama is the Founder of Degree Free. In this conversation, we talk about the data as to why college may not be as lucrative as people think, examples that include an 18-year-old bitcoin developer, why proof-of-work is so important, role of the parents, and a brand new launch program working one-on-one with teenagers. Listen on iTunes: Click here Listen on Spotify: Click here How The Idea of Proof-of-Work Is Changing CollegePodcast Sponsors
You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research. Invite your friends and earn rewardsIf you enjoy The Pomp Letter, share it with your friends and earn rewards when they subscribe. |
Older messages
Bitcoin Is Beaten Down By The Macro Environment
Wednesday, May 1, 2024
Listen now (3 mins) | To investors, Bitcoin's price has been falling in recent weeks. This may be surprising to market participants that expected the digital currency to rise aggressively after the
Hong Kong Launches Crypto ETFs To Lackluster Trading Volumes
Tuesday, April 30, 2024
Listen now (3 mins) | To investors, There were six new crypto ETFs that started trading in Hong Kong on Tuesday. These were the first spot bitcoin and spot ether ETFs to launch in the region, but the
There Is So Much Money Sloshing Around The System
Monday, April 29, 2024
Listen now (2 mins) | READER NOTE: This Thursday I am hosting a free webinar for anyone who is trying to transition into a new job in the bitcoin and crypto industry. Previously, my team and I have
Podcast app setup
Monday, April 29, 2024
Open this on your phone and click the button below: Add to podcast app
Politicians Want Higher Taxes To Cover For Their Lack of Discipline
Thursday, April 25, 2024
Listen now (4 mins) | Today's letter is brought to you by Shortform! Shortform has the world's best guides to 1000+ nonfiction books. Learn key points and gain insights you won't find
You Might Also Like
🌎 How the smartest startups are building remotely
Thursday, July 4, 2024
Smart startups are going global, and now it's your chance to do the same
🌎 How the smartest startups are building remotely
Thursday, July 4, 2024
Smart startups are going global, and now it's your chance to do the same
🕵️♂️ A new heist (next week)
Thursday, July 4, 2024
And you are invited!
LUC #58: Understanding Data Streams — The Solution to Handling Continuous Flows of Big Data
Thursday, July 4, 2024
Plus, concurrency is NOT parallelism, explaining SOLID principles, and API design best practices
Temu got sued for stealing [Crew Review]
Thursday, July 4, 2024
Happy 4th of July! After you celebrate Independence Day, try to liberate yourself from unnecessary PPC spend by attending our PPC Bootcamp's final webinar this July 8. All you need is an EcomCrew
Unraveling SEO in 2024
Thursday, July 4, 2024
I keep hearing from people whose websites never recovered after Google's September 2023 Helpful Content Update. And the blows just kept on coming... more algorithm updates, AI Overviews... it's
Ranking gaming's most active VCs
Thursday, July 4, 2024
Sizing up Asia-Pacific's healthcare market; PE piles into pharma services; Forestay snags $220M for Fund II Read online | Don't want to receive these emails? Manage your subscription. Log in
On the 4th of July
Thursday, July 4, 2024
We all share a responsibility to improve our nation through our willingness to respect each other's differences, working on solutions, not complaining about problems.
Miracle Paint, America's Smartest Highway and European City Branding | Non-Obvious Insights #426
Thursday, July 4, 2024
July 04, 2024 | Read Online Miracle Paint, America's Smartest Highway and European City Branding fb tw in email Dear Newsletterest, I'm traveling in Europe today for an event and so my story
🔔Opening Bell Daily: Bullish on USA
Thursday, July 4, 2024
A special edition that features two interviews with veteran investing experts on reasons to be optimistic on the US economy.