Open Thread II: What happens when the Fed cuts?

Excellent conversation last night — no politics, great debate and lots of varied (i.e., Bullish/Bearish) opinions. It has emboldened me to take another whack at it.

The equity markets look much better this week than last. This raises several worthy questions:

How much of a Fed cut is built in already? 25, 50 or 100bps?

What happens to equities when the Fed cuts?

Are there good parallels to other rate cutting periods? 1998, 2001, or… ?

Once again, a few provocative articles might color the discussions:

Must Stocks Rise Following a Cut in the Fed Funds Rate?  (Hussman)   

The Hunt for Black October (

Paulson Hedge Fund Trounced Competitors, up 300%; Goldman Fund Falls 16%  (Bloomberg) 

What say ye?



please steer clear of politics and ad hominem attacks . . . Please play nice!

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