People often misunderstand the difference between emergency cuts, programmed cuts, expected cuts, and priced-in cuts. What we are seeing right now is far beyond what I would describe as an emergency. Powell will likely highlight how inflation is going lower toward the 2% target and the favorable CPI and PPI numbers that are also better than market expected at the beginning. Using this as a reason for rate cuts which are above the first expectations. Currently, the market has priced in a 0.25% to 0.50% cut. Ignore short-term volatility, as the Fed will almost certainly print money again. Don’t compare this cycle to others or to other emergency cuts; each rate cut is unique and should be analyzed on its own terms.

Only someone with no knowledge about this market would repeat the mainstream narrative that others are discussing. No, a rate cut does not signal that ‘something broke,’ as some misguided analysts claim. We already know that something is broken in our system, we have known this for a long ti…