Laura Hagger

Why Rate Cuts Often Signal Trouble Ahead 🧵 (not saying that’s the case now, just providing historical context for the uninformed) 1/ When the Fed cuts rates, markets often cheer. But history shows that cuts usually come after the economy is already weakening – and they often precede market declines. 2/ Since the 1970s, the Fed has launched seven major rate-cut cycles, averaging –6.4 percentage points over ~26 months. Every one has been tied to a slowdown or recession. 3/ Market volatility tends to spike before the first cut – ~22.5% vs a ~15% average. That elevated fear lingers for at least a year. 4/ Stocks usually bottom 3 months after the first cut – about 5% lower than when the cut was announced. 5/ Examples: – 2001: S&P 500 was –10.7% three months later. – 2007: Down ~2.1% at 3 months and –21.7% one year later. 6/ Not every cut is doom. If the economy keeps expanding, stocks can rally hard – S&P 500 has gained ~20%+ a year later in those cases, without exception. 7/ Bottom line: Rate cuts don’t cause crashes, but they often confirm trouble is here. In recessions, they precede pain. In expansions, they fuel rallies. Context is everything.

5 reasons you should stop giving a f*ck: 1. Nobody’s thinking about you – they’re too busy worrying about themselves. 2. Your loudest critics are people you’d never take advice from. 3. In 100 years we’ll all be gone – none of this will matter. 4. Regret stings harder than failure – so take the shot. 5. Worrying won’t change the outcome – it just ruins the moment. Care less. Live more.