Some argue that the United States is continuously shorting us through monetary policy. However, the exchange rate of the Chinese yuan has only slightly depreciated, while the U.S. Treasury and the Federal Reserve have paid a huge price. The Federal Reserve has been raising interest rates for over two years, with rates becoming increasingly higher, and overnight reverse repurchase agreements have resulted in substantial losses for the Federal Reserve.

To put it simply, banks use their money to purchase the Federal Reserve's overnight reverse repurchase agreements. In the past, the interest rates on the U.S. dollar were low, and the Federal Reserve's costs were limited. However, the issue now is that the U.S. dollar interest rates are very high, and banks are not keen on lending, which leads to the Federal Reserve underwriting the massive U.S. dollar capital flowing back to the United States. Consequently, losses have become inevitable.

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In fact, the U.S. Treasury has paid an even higher price. The United States aims to create a high-interest environment by continuously raising interest rates, causing debt collapses in other countries. However, in reality, the interest payments on U.S. government debt have also increased significantly.The expenditure of the previous fiscal year was merely $600 billion, but the interest expenditure on debt for the current fiscal year has soared to $1.1 trillion. As the U.S. fiscal deficit continues to expand, the increase in debt interest directly adds to the annual fiscal deficit.

According to basic logic, the Federal Reserve should now accelerate the pace of interest rate cuts to address the deficit issue.

However, with the recent strong performance of China's capital market, a large influx of global funds into China has caused the Federal Reserve to change direction once again.

On one hand, the U.S. recently released an eye-catching non-farm employment data. The number of employed individuals exceeded expectations by 100,000, while the unemployment rate dropped by 0.1 percentage points.

Perhaps feeling this was not enough, the U.S. then also announced a CPI data with a year-on-year increase of 2.4%.

This move is nothing more than an attempt to inform the market that inflation has not declined as expected, and employment is far more optimistic than anticipated. Therefore, significant interest rate cuts are not feasible.

On the other hand, Federal Reserve Chairman Powell publicly stated that the possibility of substantial interest rate cuts in the future has been urgently halted.

But if the Federal Reserve continues to maintain high interest rates, more maturing low-interest Treasury bonds will be replaced with newly issued high-interest Treasury bonds, further increasing the interest expenditure of the U.S. Treasury.

At the same time, the Federal Reserve's deficit is also difficult to make up before 2027.

Does the U.S. still have the confidence? How long can it sustain?