Signing off for 2023 - See you in 2024

Last week the Fed announced that they expect interest rate cuts several times next year.

This is bullish for the market overall, so we are having this run-up. It’s also tied into the Santa Rally.

Some people think that rate cuts are bearish. And they are right when there is a problem in the economy that the rate cut is put in place to solve. The 2008 financial crisis was an example of this.

This rate cut isn’t because of a crisis in the economy. It is necessary because the US risks being unable to pay its debt if rates remain high. The fed is forced to cut rates as they see their debt load now, whether they like it or not.

Rate cuts mean that medium and small corporations can borrow money cheaply and invest and grow. This is bullish.

When we heard certain members of the Fed saying rate cuts weren’t guaranteed later last week, this seemed to be an effort to slow down skyrocketing equity / stock prices once they pumped. 

The Fed doesn’t like when what they say has a direct result on equities, so they walked back their statement on cuts being guaranteed for a moment. You may have noticed the market slowed- but only for a morning. Once institutions digested that news, they realized it was a nothing-burger.

The big institutions know they will be forced into rate cuts, it’s a given at this point. They have to pay the debt bill. Rate cuts are simply a matter of when.

Enjoy the Santa Rally this week. I like the idea of moving into more cash after Dec 29th so I can buy some dips in Jan and trade from there.

I’ve gotten emails from some of you sharing your profits using the trades. I love hearing from you, and nothing will make me happier than getting a slew of these messages from you next year. No doubt they are coming!