Can interest rate cuts solve the "overvaluation risk" of US stocks and bonds?
Taking the 2008 financial crisis as a lesson, if the USA has already or is about to start declining, even a significant interest rate cut cannot prevent the arrival of a bear market. According to goldman sachs's latest research reports, if the economy has already entered a recession before the first interest rate cut, then the s&p 500 index is expected to drop an average of 14% in the next year.
A week ahead | Powell and Fed officials speak intensively! The Fed's most favored inflation indicator is about to be released.
Micron Technology, Costco, and many other companies have successively released their financial reports. In addition, the Japanese stock market was closed on Monday for the autumnal equinox; on Tuesday, the Reserve Bank of Australia announced its interest rate decision, and RBA Governor Lowe will then hold a press conference on monetary policy; on Thursday, the Swiss National Bank announced its interest rate decision.
After the resolution, the two heavyweight voting members spoke out, Goldman Sachs: suggesting that the Federal Reserve may slow down the pace of interest rate cuts, it's hard to say in November.
Goldman Sachs stated that the current market expectation is a 25 basis point interest rate cut in November and December. However, there is still significant uncertainty whether there will be a 50 basis point interest rate cut in November.
Analysis: Short-term debts may be boosted by the Fed's interest rate cut.
Gelonghui September 21st | Since the Federal Reserve is cutting interest rates, short-term Treasury bonds and other short-term bonds should get a boost because they are closely related to the federal funds rate. Long-term bonds will depend more on the outlook for inflation and economic growth, which the Federal Reserve does not directly control. The advice of Stuart Springer, a senior wealth advisor at Citigroup's personal wealth management company, is: "Shorter, but not too short, is the best choice for now."
Express News | Analysis: A deficit means the Federal Reserve needs to maintain restrictive interest rates for a long time.
Express News | On the day the Federal Reserve cut interest rates, they sent someone to China to discuss the economy.