My Twitter account has about 25,700 followers. There’s another account from a far more bullish chap which has nearly a million. He offered up the following thought regarding the forthcoming Fed cut:
I don’t know anything about the “12 months later” argument, and I’m not even going to touch the “barely in its 2nd inning” schtick, but allow me to share with you my own perspective about interest rates and stocks.
First off, here is the Fed Funds rate, courtesy of SlopeCharts, going back for many, many decades:
I created a layered chart with the aforementioned interest rate and the good old S&P 500 index. I synched them up and zoomed in on the past few decades. Kindly note the green tinted zones.
My conclusion is the diametric opposite of what my vastly-more-popular competitor asserted. What I see here – – 100% of the time – – is that major market plunges go HAND-IN-GLOVE with collapsing interest rates. It makes sense, too. When the market is in a free-fall, what else is the Fed going to do? RAISE rates?
We shall see, in the months ahead, which “100%” prediction turns out to be the more accurate.
