IYY - What I Expect After The Fed Cuts Rates In 2024
2024-06-20 01:11:46 ET
Summary
- Last week, the Fed maintained its view that rates would be cut this year.
- While the outcome was quite hawkish, I chose to look beyond this and ask what happens after they finally cut rates, so we can prepare.
- Since 1921, the Fed has initiated 22 rate cut cycles. How did the S&P 500 do afterwards?
- What can we learn from the past as we look to the future?
Written by Sam Kovacs
Have you ever wondered what actually happens when the Fed cuts rates? While stock market pundits, myself included, have been tirelessly speculating on the pivotal moment of the rate cycle, how much have we truly examined the aftermath?
In this article, I'll look into the historical patterns of stock market reactions following rate cuts, and try and place the current market in a historical archetype by asking tough questions like: Are we in a bubble? If yes, will it burst any time soon? Are we headed for a recession? Are we on the brink of massive technological change.
Sounds good? Let's dive in.
The Fed's long history of rate cuts
The Fed was established in 1913 by the Federal Reserve Act to provide the United States with a stable and secure financial system. Since its inception, monetary policy has been a key tool the Fed has used to influence economic conditions....
What I Expect After The Fed Cuts Rates In 2024