RATE RELEGATION
08/08/2024 |
Markets are implying an 80% chance of a 50bps September cut. Great news, right? Maybe not. On 1/3/2001, the Fed began with a 50bps rate cut and a recession came in March. On 9/18/07, the Fed also began with a 50bps cut and in December a recession commenced. Both times equities jumped and headlines praised the Fed. In the 2001/02 recession equities fell 42%, in the 2008/09 recession, 50%.