The capital market has been quite lively recently, with A-shares showing signs of peaking after a big pump, the Hong Kong stock market not following suit, BTC experiencing a significant pullback first, and the Nasdaq also declining today, all pointing to issues related to liquidity.

The "safety cushion" reverse repurchase account OnRRP on the Federal Reserve's balance sheet has only 40 billion left, and it will soon start to "withdraw blood" from bank reserves, significantly increasing the crowding out effect on the market.
Now the bank reserves are 33 trillion, of which excess reserves are 1 trillion, and the market will face a net issuance of about 300 billion US Treasuries. Liquidity is shifting from "ample" to "tight."
The impact on assets requiring liquidity is particularly severe: crypto, Nasdaq, US long-term bonds.
To change this situation, the Federal Reserve or the Treasury needs to take action; otherwise, the market trend will continue to show a pullback.
The Federal Reserve is basically a hands-off manager now, lacking the motivation to inject liquidity, and we can only hope that Powell will be dovish at the Jackson Hole meeting this weekend.
On the Besent side, there is a will but not enough strength. The Treasury TGA account has just returned to 550 billion. If the market changes drastically, how much can Besent take out for the bond repurchase?
Of course, Besant's verbal skills are strong, and a large-scale crisis is unlikely. However, a short-term market pullback is inevitable. #Crypto market pullback