After 3 Years of Tightening, There Was a Reason the Market Stayed Intact Despite Predictions of Collapse. We Walk You Through Where Money Was Created and Where It Flowed, Step by Step | Division Head Seong Sang-hyeon [Part 1]

The video revisits the view that division head Seong Sang-hyeon has advocated since 2023: “The Fed is tightening, but market liquidity is not declining.” It explains the possibility that banks expanding credit will replace the Fed and government fiscal spending as the main source of liquidity. He argues that the US government aims to lower its high debt ratio by increasing nominal GDP and productivity rather than directly reducing debt, and sees AI investment and bank deregulation as key tools for doing so. He maintains that inflation is difficult to control through interest rate increases alone because supply-side factors arising from the expansion of data centers, energy, and investment play a substantial role. He argues that the government and the Fed are likely to coordinate to manage inflation expectations without undermining the growth cycle. From an investment perspective, he concludes that a concentrated portfolio and leading sectors such as AI and energy, with operating profit margins and growth potential capable of overcoming high interest rates, are important. He also says that bank deregulation, stablecoins, and the Fed’s role in securing demand for short-term Treasury securities warrant continued monitoring.