The markets are pricing in the first rate cut in more than four years. As of this writing, it looks like we can expect a 50-basis-point cut on Wednesday, with a 50% probability of a 1.25% cut by December.
That’s fast… but what’s the hurry? Is the Fed that desperate to accommodate the mountain of T-bill debt the Treasury will roll over in the coming year? Treasury Secretary Janet Yellen made a big bet that the Fed would cut this year when she directed the Treasury to issue T-bills over bonds and notes.
The Fed has a “mountain” of its own to contend with - unrealized losses they’re holding onto.
We need to ask ourselves two questions (at least!): Are they sprucing up the balance sheets’ appearance by cutting rates? Or are we peeking over the edge of an economic precipice?
That’s what we’ll answer in tonight’s video - all the answers. Naturally, we’ll look at bonds, gold, and, importantly, bank stocks.
Let’s get right to it…