The End?Have the fed realized that the economy is broken? Is there something they don’t want to tell us? Why was there 818,000 jobs overstated in the data they ‘react’ to. What is the real data?
Consumer stocks are a more reliable barometer for how healthy the economy. Stocks from Dollar General, to Starbucks, to Nike and LVMH, the spending is weak.
Low income consumer - weak
Mid tier consumer - weak
High end consumers - weak
So did we get a 0.5% reduction because they have reacted too late and realized the economy has underlying weaknesses? Possibly so, they have done so in the past:
Looking at the history of recent cuts followed by crashes due to economic weakness:
2000-2001 - dot-com bubble
2007-2008 - Great financial crisis
Rate cuts were implemented in response to underlying economic issues. The market interpreted these cuts as confirmation that the Fed was worried about economic conditions, which led to panicked selling and eventual market crashes.
2024 - 2025 - the end of the grand supercycle due to massive rise in unemployment or do we get the continuation to more all time highs?
Nobody knows where we are just yet but there are clues to what will happen next, if you know what you’re looking at.
I do firmly believe we are in the 5th wave of a multi decade supercycle. When it ends, it will be very ugly. Stay tuned!