Could more Fed rate cuts be on the cards this year than anticipated? In Q1 2025, the consensus was for just one rate cut, likely during the second half. But March’s sharp stock market correction, amid geopolitical and economic uncertainties, with the S&P sliding into correction territory for the first time since 2023, could be what was needed for more Fed rate cuts this year. If so, front-end rate strategies are back in...
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The year 2024 ends with the Fed keeping monetary policy in restrictive territory. Despite three rate cuts in 2024, with a 25-basis-point reduction in November and a more aggressive 50-basis-point reduction in September, sending the Fed fund rates to 4.25% to 4.5%, which is still above the neutral rate of 3.1% and therefore restrictive. Why is the Fed keeping rates in restrictive territory? There is still persistent inflation in...
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Stock buybacks could be the next adrenaline rush to keep the bulls running, particularly as the Fed loosening cycle commences in the second half of 2024 in time for the presidential elections. Fed rate cuts are coming soon, which will help fuel a new wave of stock buybacks Already, two central banks cut their base rates in June last month. The European Central Bank trimmed its key rate from 4% to 3.75%, its first rate cut in nine...
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The Big Cycle could have more of an impact on inflation than the Fed’s monetary policy. A change in the world order cycle is underway, which has been coined as the Big Cycle by Ray Dalio, a top geopolitical macro analyst and hedge fund investor of our time. When an existing global power retreats or appears too weak for global leadership, a power vacuum exists. This Big Cycle, where the existing post-WW11-US hegemonic rule is...
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The speed of Fed rate hikes this year, in 2022, is unprecedented in history. In just six months, the Fund rates have risen more than 2% at a time when the public deficit is also at an unprecedented level at over 31T USD. The speed of Fed rate hikes is bleeding its livestock (citizenry) dry Interest on the public debt is fast approaching 500B USD, the third largest budget item costing every adult farm animal 13,491 USD per year,...
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