The internal divisions within the Federal Reserve have become public and are more intense than expected.

Federal Reserve officials' recent remarks have directly triggered the market: there may be a need for cumulative rate cuts of over 100 basis points by 2026. This is not a mild policy adjustment but a clear signal—the dovish camp believes the current policy framework is significantly tight, and economic growth is being dragged down.

Contrasting this with the hawkish stance reveals the contradiction. Hawkish officials insist that current interest rates are already in the "neutral zone," implying limited room for future rate cuts.

The numbers are clear: the federal funds rate is currently stuck between 3.5% and 3.75%, but the market generally estimates the neutral rate at only 3%. According to Milan's logic, this means rates need to fall rapidly and significantly to reach the level the economy truly needs.

This is not just a policy debate but a direct hedge against future liquidity directions. The huge internal disagreement within the central bank usually signals one thing: policy paths will be full of uncertainty. What markets fear most is never a single direction but "not knowing which side the Fed will choose."

When Federal officials start using phrases like "far exceeding 100 basis points," a comprehensive game of liquidity expectations has already begun. For holders, it's time to prepare adequately for the upcoming volatility.