Interest Rate Policy - The market anticipates a 25 basis point interest rate cut in September following guidance from Jerome Powell [1] - The Federal Reserve's decision-making will be data-dependent, assessing economic outlook and risk balance [1] - A friend of the company suggests that cutting rates into an economy where PMIs are going higher is just going to help the market in a significant way into the end of the year [1] - The company friend does not think the Fed should do a 50 basis point cut [1] Labor Market - The labor market is now considered more important than inflation in the Fed's decision-making [1] - Estimates suggest potential benchmark revisions for labor, indicating 500,000 to 900,000 job losses [1] - The labor market is more fragile than the 42% jobless rate suggests [2] Market Reaction & Economic Impact - Stocks surged 80 points and Bitcoin gapped up from $112,000 to $116,000 in response to the news [2] - Lower interest rates are generally viewed as beneficial for businesses, consumers, and investors, potentially leading to economic growth [2] - History suggests that a period of 5 to 12 months between Fed cuts is typically bullish for stocks, with the S&P 500 rising in 10 out of 11 instances [2]
Rate CUTS Are Coming And Markets Are Ready To RIP
From The Desk Of Anthony Pomplianoยท2025-08-22 21:00