It has been revealed the fact that there is an incredibly significant rug pull of liquidity that will take place, and this is going to have two important effects. Check out the latest reports about this below.

Rug pull of liquidity and its impacts

According to Bloomberg Intelligence’s senior macro strategist Mike McGlone, the economy is on the verge of a recession due to an impending liquidity crunch, which will also lead to a Bitcoin (BTC) correction.

McGlone predicts that the Federal Reserve will continue to be hawkish until the end of 2023 to combat inflation, which will cause the plummeting of risk assets like Bitcoin.

He asserts that the current situation is the greatest rug pull in liquidity ever, following the biggest pump in liquidity ever, and the evidence supporting this is shocking.

McGlone notes that there are plenty of economists who previously predicted a recession due to the Fed’s aggressive rate hikes have pushed out their timelines to the end of this year, and he believes that high-interest rates will cause bond yields and the stock market to drop.

“I can go back and give you examples from the 1920s when the US created a massive supply of liquidity, and they shouldn’t have. So, the money supply is still negative, PPI (producer price index) year-over-year is still negative, and the Fed is still hiking rates. Everything else is going to trickle down from that, and the Fed is not going to stop…”

He continued and stated the following:

“I fully expect bond yields, everything to drop after the stock market does, and the question is, What stops it? On our call this morning, even our main economist said, yes, they’ve been early, there have been a little bit wrong, but they’re still maintaining their year-end recession view.”

It is also important to note the fact that the analyst predicted that Bitcoin will collapse in 2023 as liquidity declines.

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