If the Fed decides to keep rates steady tomorrow without dropping, then I expect a 3% drop.

If there is an interest rate drop then we have bottomed and in for another bull run.

There is a prevailing theory, especially among the MAGA crowd, that Trump was playing 4D chess and tanking the market on purpose to get the Fed to drop rates, fulfilling a campaign promise and allowing Trump to refinance a large portion of the government debt at lower rates. While I don’t necessarily agree with the hypothesis, we know that short-term moves in the market are generally not based on fundamentals.

I also think that if Powel doesn’t drop rates, then the next social media post that Trump makes will be something along the lines of “Powel needs to be fired” and that will add more uncertainty to the market. If anything, we mostly like Powel because he’s been so transparent. Do we know what a Trump appointed Fed chair would do?

What do you think?