The Bank of Russia is set to make a second straight half percentage-point cut to its key interest rate, offering only limited relief to the slowing economy amid uncertainty over whether an upcoming tax hike could stoke inflation https://t.co/9sgasAqTHe ...

US central bank cuts interest rates for third time this yearFollow live https://t.co/0jfoSeNIhj ...

The Bank of Canada cut interest rates as it sees damage from US tariffs persisting, but signaled that borrowing costs are roughly at the right place as long as its forecasts materialize. https://t.co/ZEhUFDnuM1 ...

New Zealand’s central bank is expected to cut interest rates this week but economists are divided over how aggressively it will respond to the weak economy https://t.co/WgDJt69GEz ...

Market Trends & Regulatory Landscape - Interest rates are being lowered, with expectations of further decreases [1] - The SEC is urged to approve approximately $125 trillion (estimated based on context) of 401k capital for crypto investments [1] - Crypto Spot ETF approvals are underway, facilitated by new generic listing standards [1] - The SEC has requested issuers of LTC, XRP, SOL, ADA, and DOGE ETFs to withdraw their 19b-4 filings [1] - Withdrawals of 19b-4 filings could commence as early as this week [1] Timeline - Q2 2025 is on Wednesday [1]

Market Trends & Dynamics - Small cap stocks and ETFs are currently in focus [1] - Major indexes, including the small cap Russell 2000, hit record highs following a 25 basis point interest rate cut by the Fed, signaling potential for further cuts [2] - The S&P 500 index has significantly outperformed the Russell 2000 over the past 10 years, gaining approximately 302% compared to the Russell 2000's 142% return [3] - Small and midcap companies led a market rally with the Russell 2000 surging 7% in August [3] - The Russell 2000 ETF is up almost 12% this year, outperforming IJR due to holdings benefiting from the AI boom, quantum computing, or nuclear energy [15][16] Investment Opportunities & Risks - Small cap stocks are sensitive to interest rates due to higher debt burdens and floating interest rates, potentially benefiting from expected rate cuts [5][6] - Small cap valuations appear attractive, with the Russell 2000 having a P/E ratio of 1890%, compared to the S&P 500's 2990% [4] - Small cap stocks are dependent on continued economic growth and may underperform if the economy slows down or enters a recession [6][7] - ETFs are a better way to get exposure to small cap stocks due to limited analyst coverage for individual small cap stocks [10] ETF Performance & Characteristics - The iShares Core S&P Small-Cap ETF (IJR) is up about 923% since its inception in May 2000, while the iShares Russell 2000 ETF (IWM) is up about 640% over the same period [8] - The Invesco S&P SmallCap Momentum ETF (XSMO) selects 120 securities with the highest momentum scores and has an expense ratio of 39 basis points [17] - The VictoryShares US Small Cap Free Cash Flow ETF (VFLO) aims to select 200 profitable small cap companies with high free cash flow yields and has an expense ratio of 47 basis points [18][19]

Hassett offers an endorsement of the Fed’s decision to cut interest rates by 25 basis points, even after Trump and his allies had pressed for a bigger reduction https://t.co/8Xs9silHQJ ...

Economic Conditions - The unemployment rate remains low but has edged up, with job gains slowing and downside risks to employment rising [1] - Inflation has risen recently and remains somewhat elevated [1] - Recent indicators suggest that growth of economic activity has moderated [3] - GDP growth rose at a pace of around 1% to 1.5% in the first half of the year, down from 2.5% last year [3] - The moderation in growth largely reflects a slowdown in consumer spending [3] - Business investment in equipment and intangibles has picked up from last year's pace [4] - Activity in the housing sector remains weak [4] Monetary Policy - The Federal Open Market Committee decided to lower the policy interest rate by a quarter percentage point (0.25%) [2] - The Committee also decided to continue to reduce its securities holdings [2] Economic Projections - The median participant projects GDP to rise 1.6% this year and 1.8% next year [4]

Market Outlook & Strategy - The market anticipates three rate cuts, which differs from the potential of a one-time cut, impacting market highs [6] - Economic data holding steady is positive for stocks, leading to a steeper curve and growth [2] - Focus on interest rate-sensitive sectors and mega-cap growth stocks for continued outperformance [4][5] - Low rate volatility, lower dollar volatility, and lower oil prices are conducive to buying risk assets globally [15] Economic Indicators & Concerns - Labor market weakening is a key factor influencing potential interest rate cuts [4] - A bifurcated economy exists where the stock market performs well, but challenges remain for new graduates and the working class [8] - Consumer strength, especially among lower-end and younger consumers, is crucial for a healthier bull market [10] Global Trade & China - Optimistic China trade news signals the worst is behind us, providing clarity for companies to plan costs [11][12] - Peak aggregate rates are expected to be 30%, allowing companies to better judge costs and plan [12] - China's economy may be performing worse than its stock market, similar to the US labor situation [13]

Poland’s central bank is set to cut interest rates by a quarter point next week before a likely pause in its monetary easing, according to Monetary Policy Council member Henryk Wnorowski https://t.co/Cr3q0kes61 ...