Bitcoin investor Anthony “Pomp” Pompliano has sparked a major debate, claiming that Donald Trump is deliberately tanking markets to force the Federal Reserve into cutting interest rates.
In a March 10 post on X, Pompliano argued that Trump and Treasury Secretary Scott Bessent are actively driving down asset prices to pressure Federal Reserve Chair Jerome Powell into lowering rates, which could help refinance America’s mounting debt.
The strategy, if true, could reshape both financial markets and the 2024 election cycle, but does the theory hold up?
At the heart of Pompliano’s claim is a high-stakes debt crisis. The U.S. has nearly $7 trillion in debt due in the next few months. Refinancing this debt would be costly if rates stay high, further straining the economy.
Trump has publicly criticized high interest rates, arguing that they stifle economic growth. Despite his calls, the Fed held rates steady in late January, refusing to cut from the current 4.25% to 4.5% target range.
According to Pompliano, Trump is taking a more aggressive approach, leveraging market fear to push the Fed into action.
Market Chaos Coincidence or Coordinated Strategy?
Pompliano points to several recent developments that could support his theory:
- Trump’s new tariffs have added fresh uncertainty to the economy.
- The S&P 500 dropped 2.66% on March 10, while the Nasdaq-100 fell 3.8%, according to Google Finance data.
- Bitcoin has plunged 27.4% from its all-time high, wiping out over $1.2 trillion from the crypto market since Dec. 17.
At the same time, bond yields are falling, which Pompliano sees as proof that the strategy is working.
“The 10-year Treasury yield is already down from nearly 4.8% in January to 4.21% now—a sign that Trump’s plan is heading in the right direction,” he claimed.
If yields continue to fall, borrowing costs will drop, easing pressure on the government’s massive debt obligations.
Who Will Blink First? Trump or Powell?
Pompliano believes this standoff is turning into a game of chicken between Trump and Powell.
Powell may have to cut rates if markets continue to tumble, even if it goes against the Fed’s usual playbook.
The CME FedWatch tool, which tracks rate expectations, currently shows a 96% probability that the Fed will hold rates steady on March 19. However, by May 7, expectations for a rate cut are near 50-50 odds—suggesting that the pressure campaign could work.
“The big goal is to get interest rates down,” Pompliano said. “That will lead to more economic activity, thanks to access to cheap capital. Give people cheap capital, and they’ll go and do things with it.”
While Trump has not openly admitted to manipulating markets, his March 9 Fox News interview raised eyebrows.
“Nobody ever gets rich when interest rates are high because people can’t borrow money,” Trump stated.
If the Fed refuses to cut rates, some economists warn of a “Trumpcession,” a recession triggered by aggressive economic moves under his administration. However, if rates do fall, it could set the stage for a Trump-led economic resurgence heading into the election.
What Happens Next?
With markets on edge and the next Fed meeting on March 19, investors are bracing for potential rate decisions in May.
- If the Federal Reserve stands firm, markets could face more volatility as Trump ramps up pressure.
- If Powell gives in and cuts rates, it could fuel a rally across stocks and crypto, but at the risk of reigniting inflation.
Trump’s influence over the economy remains a powerful force—whether it’s a calculated strategy or just strong rhetoric. Either way, markets are watching closely, and the stakes couldn’t be higher.
