A lot of people interpreted your comments at the October meeting that you know when there's a foggy [clears throat] situation we slow down to mean that you know there wouldn't be a cut now there'd be a cut in January instead. So it'd be good to get a sense of why did the committee decide to move today rather than to move in January instead. Thank you.>> Right. So in October I said um that there was no certainty of moving and that was uh that was indeed correct. I said it's possible you could think about it ...

Core Viewpoint - Investors are preparing for the Federal Reserve's final interest-rate decision of 2025, with historical trends indicating a modest gain for the S&P 500 on Fed days in December [1][2]. Group 1: Historical Performance - Since 2000, the S&P 500 has averaged a gain of approximately 0.2% on December Fed days, with a median gain of 0.1% [2]. - Last December was an exception, as the S&P 500 experienced its largest decline on a Fed day since 2000, following the release of economic projections that suggested a slower pace of rate cuts [3]. Group 2: Market Reactions - Fed Chair Jerome Powell has historically caused market volatility on Fed days, often leading to significant sell-offs in the final trading hour [4]. - Recently, however, the S&P 500 has shown less volatility on Fed decision days, with an average one-day change of only 0.14% over the last five Fed days [7]. Group 3: Current Expectations - Investors anticipate a 25 basis point rate cut from the Federal Open Market Committee, with a focus on guidance for the rate path in 2026 and any signs of division among FOMC voting members [6]. - The consensus suggests that today's rate cut may be characterized as a "hawkish cut," indicating a pause on further cuts for the time being [8].

Core Viewpoint - The market is currently skeptical about the necessity for rate cuts, with the 10-year yield hovering around 4.20% due to concerns over inflation and fiscal deficits [1][2]. Domestic and Global Influences - The rise in 10-year yields is influenced by both domestic factors, such as the Fed's potential for overly accommodative policies amidst persistent inflation near 3%, and global factors, including rising yields in other markets like Japan [4][5]. - Approximately half of all U.S. Treasuries are held outside the U.S., making international yield trends significant for U.S. bond markets [5]. Yield Curve and Market Expectations - The yield curve is expected to steepen, with 10-year yields testing the upper range around 4.25% [7]. - Short-term yields are pricing in potential rate cuts, reflecting some softness in the labor market, while long-term trends suggest a steeper yield curve [8]. Investment Opportunities - There are opportunities in global government bonds, particularly as a weaker dollar may enhance diversification [10]. - A focus on high credit quality and intermediate duration bonds is recommended to balance reinvestment risks and inflation-related yield increases [10]. - The municipal bond market offers attractive tax-equivalent yields, making it appealing for investors in higher tax brackets [11]. - Treasury Inflation-Protected Securities (TIPS) are suggested for those concerned about inflation, as they lock in real yields [11].

Core Viewpoint - Gold's recent rally faced a correction due to risk-off sentiment in technology and concerns over the Federal Reserve's monetary policy approach, which increased the dollar's value and pressured gold prices [1] Group 1: Federal Reserve and Market Sentiment - After a decline, market sentiment improved, driven by rising expectations that the Fed will shift from a hawkish to a more accommodating stance [2] - Polymarket indicated an 81% chance of a 25-basis point cut by the Fed during the December 10 meeting, up from 44% a week prior [3] Group 2: Economic Implications of Monetary Policy - A dovish Fed approach would likely decrease the dollar's relative value, potentially encouraging spending and investment, but could disincentivize savings [4] - The risk-free yield from 10-year Treasuries may become less attractive due to inflation, leading to negative real returns if inflation exceeds the yield [5] Group 3: Investment Strategies and Opportunities - Investors may seek higher-income-generating specialty funds to keep pace with living costs, as consumer prices continue to rise [6] - The ProShares Nasdaq-100 High Income ETF (IQQQ) is positioned to benefit from anticipated Fed easing, making it more attractive compared to traditional debt securities [8] Group 4: IQQQ ETF Mechanics and Performance - The IQQQ ETF employs a daily call-writing mechanism, allowing for more frequent adjustments to strike prices compared to monthly systems, which can lead to significant opportunity costs [9][10] - Since the start of the year, IQQQ has gained nearly 6%, with a stronger performance of about 15% over the last six months [12] - The ETF's structure involves total return swaps, introducing credit and execution risks, while providing option-premium-based income [11][13] Group 5: Market Trends and Investor Considerations - IQQQ has shown a bullish trend since late November, with a 1.5% gain since December 1, despite low but stable trading volume [14] - Investors looking for income while maintaining exposure to leading tech names may find IQQQ's approach suitable, balancing capped upside with steady cash flow [16]

Joining me now to talk about this is Independent Institute senior fellow and former Federal Reserve Board nominee Judy Shelton. Uh Judy, let me just jump to it. Let's talk first about whom you are favoring among the five candidates on the short list and then we'll get to who you do not think should get the job.>> Well, I think Kevin Hasset would be an excellent choice. Uh we just heard in that answer that um he's not willing to say exactly what he will do over the next six months. Yeah.>> But I think the th ...

Key Takeaways The FOMC is expected to cut interest rates by 25bps.The options market implies a ~1% SPX move post-announcement.Powell's tone and 2026 rate cut expectations are the real market drivers. If there’s one economic event investors should follow, it’s the action of central banks. Legendary billionaire investor Stanley Druckenmiller, who has never suffered a down year in more than 30 years on Wall Street, said it best when he said:“Earnings don’t move the overall market; it’s the Federal Reserve Boar ...

Core Viewpoint - The Federal Reserve is expected to announce a 0.25% rate cut during its final meeting of the year, with a 90% probability indicated by CME Group data [1][6]. Group 1: Federal Reserve Meeting Expectations - The Fed's final monetary policy decision will be announced on December 10, 2025, with expectations of a third rate cut this year [1]. - The Fed will also release its Summary of Economic Projections (SEP) for 2025, which includes forecasts on economic growth, inflation, and interest rates [2]. - Investors are particularly interested in any changes to the Fed's outlook for 2026, which previously indicated only one rate cut in that year following three in 2025 [2]. Group 2: Market Reactions and Trends - Stock market reactions were muted at the market open, with the Nasdaq Composite down 0.3%, the S&P 500 flat, and the Dow Jones Industrial Average up 0.2% [4]. - Treasury yields remained steady as investors awaited the Fed's policy decision, with the 10-year yield falling to 4.14% and the 30-year yield declining to 4.78% [5]. Group 3: Divergence Among Fed Officials - There is growing concern about potential dissent among Fed officials, as two members voted against the previous rate cut in October [3][11]. - At least three regional Fed presidents have expressed skepticism about the necessity of a rate cut this week, indicating possible dissent in the upcoming decision [10][12].

Group 1 - The Federal Reserve is expected to cut interest rates by 0.25% this week, but Bitcoin's price is anticipated to remain around $90,000 due to traders already pricing in the cut [1][5] - Analysts predict Bitcoin will hover around the $91,000 resistance level without a decisive break following the FOMC meeting, with significant price action expected in early 2026 [2][5] - The nomination of Kevin Hassett as the next Fed chair by President Trump is anticipated to influence monetary policy and market sentiment, with Hassett advocating for faster and larger interest rate cuts [3][4] Group 2 - The CME FedWatch tool indicates an 87% probability for a 0.25% rate cut, while Polymarket bettors push that probability to 95% [5] - Bitcoin exchange-traded funds experienced $89 million in outflows on Monday, contributing to a total loss of $177 million for December [6] - The Fed is currently facing challenges with outdated labor data due to a prolonged government shutdown, leading to a likely wait-and-see approach [7]

Core Viewpoint - The Federal Reserve's upcoming decision on interest rates will significantly impact consumer prices, the job market, and corporate America, with a 90% chance of a quarter-point cut predicted by CME FedWatch [1]. Economic Data and Labor Market - The Federal Open Market Committee's decision is complicated by a recent government shutdown that disrupted key economic data releases, leaving the Fed without a complete picture of the U.S. economy [2][3]. - Key job and price data are delayed, including the October consumer price index and unemployment rate, which will not be available before the December meeting [3][4]. - The delayed September jobs report indicated more job additions than expected, but the increase in unemployment suggests ongoing concerns about the labor market [5][6]. Federal Reserve's Strategy - Economists expect the Fed to cut rates again but may adopt a wait-and-see approach afterward to assess economic developments [7]. - Some Fed members advocate for larger and more consistent rate cuts, indicating potential shifts in monetary strategy in 2026 as leadership changes [8]. Impact on Consumers and Businesses - A third consecutive rate cut could lower costs for major purchases, such as mortgages and auto loans, while also making credit card payments cheaper [9][10]. - Sustained rate cuts could enhance the job market by facilitating business borrowing and investment, potentially leading to increased consumer spending [12].

Group 1 - The central bank is expected to cut interest rates for the third time this year, indicating a shift from a previously hawkish stance [1] - Betting markets, including Polymarket and Kalshi, show high confidence in a 25 basis point cut, with Polymarket offering 95% odds and Kalshi offering 93% odds [2] - Traders have priced in a nearly 90% chance of a quarter-point interest rate cut, reflecting a significant change in market expectations from last month [3] Group 2 - Several major brokerages, including JPMorgan, Morgan Stanley, Nomura, and Standard Chartered, have revised their forecasts to expect a rate cut, reversing earlier predictions of no change [3]