{"id":59987,"date":"2024-12-19T05:32:39","date_gmt":"2024-12-19T05:32:39","guid":{"rendered":"https:\/\/thepatientinvestor.com\/?p=59987"},"modified":"2024-12-19T11:01:57","modified_gmt":"2024-12-19T11:01:57","slug":"fed-shock-really","status":"publish","type":"post","link":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/","title":{"rendered":"Fed shock &#8211; really?"},"content":{"rendered":"<p>Stocks plunged on indications that the Fed would slow further rate cuts after announcing a 25-basis-point cut at the FOMC press conference on Wednesday.<\/p>\n<p>Really? That could be seen coming for months. The economy has proven resilient, unemployment is low, and retail sales are growing. The obvious question is: &#8220;Why cut rates at all?&#8221;<\/p>\n<h2>FOMC Decision<\/h2>\n<p>As expected, Chairman Jerome Powell announced a 25-basis-point rate cut, lowering the fed funds rate target to 4.25% to 4.5%.<\/p>\n<p>Financial markets were spooked by the sharp jump in FOMC projections for rate cuts next year. The Dot Plot now centers on a further 50 basis points of rate cuts in 2025, a target range of 3.75% to 4.0%.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-dotplot.png?resize=525%2C519&#038;ssl=1\" alt=\"FOMC Dot Plot\" width=\"525\" height=\"519\" \/><\/p>\n<p>Compare that to the September projection below, which was equally divided between 100 and 125 basis points of cuts next year, a range of 3.0% to 3.5%.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-dotplot-sept.png?resize=525%2C519&#038;ssl=1\" alt=\"FOMC Dot Plot - September\" width=\"525\" height=\"519\" \/><\/p>\n<p>Powell explained that:<\/p>\n<ul id=\"clickthrough\">\n<li>The economy is &#8220;strong&#8221; and has made good progress towards the Fed&#8217;s goals.<\/li>\n<li>The job market has cooled but remains &#8220;solid.&#8221;<\/li>\n<li>Inflation continues to move towards the Fed&#8217;s 2% target.<\/li>\n<\/ul>\n<p>The Fed Chair provided further background in answers to reporters&#8217; questions:<\/p>\n<ul>\n<li>&#8220;We feel that slowing the pace of future adjustments seems prudent now, especially as we expect inflation to be stickier than we initially thought.&#8221;<\/li>\n<li>&#8220;Some FOMC members did cite future inflationary fiscal policy as a concern.&#8221;<\/li>\n<li>&#8220;Most forecasters keep calling for a slowdown in economic growth, but we haven&#8217;t seen it yet and don&#8217;t see one happening soon. The US economy is doing great.&#8221;<\/li>\n<li>&#8220;We&#8217;re not too worried (about loose financial conditions). Both inflation and labor have cooled, so our policy is working. Financial conditions aren&#8217;t impeding us.&#8221;<\/li>\n<\/ul>\n<h3>Fed Balance Sheet<\/h3>\n<p>Powell announced that QT would continue at the same rate, but the rate offered on reverse repo (RRP) would be lowered, which may encourage further money market outflows into the T-Bill market. Total Fed holdings of Treasuries and mortgage-backed securities (MBS) have fallen by $1.9 trillion since their peak of $8.5 trillion in 2022.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-fed-sec-mbs.png?resize=525%2C363&#038;ssl=1\" alt=\"Fed Balance Sheet: Treasuries and Mortgage-Backed Securities (MBS)\" width=\"525\" height=\"363\" \/><\/p>\n<p>Only another $6.0 trillion to go. \ud83d\ude1f<\/p>\n<h2>Treasury Markets<\/h2>\n<p>Ten-year Treasury yields jumped. Breakout above resistance at 4.5% would offer a target of 5.0%, which would be bearish for stocks and precious metals.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-tnx.png?resize=525%2C404&#038;ssl=1\" alt=\"10-Year Treasury Yield\" width=\"525\" height=\"404\" \/><br \/>\n<div class=\"content_block\" id=\"custom_post_widget-53989\"><p><!-- AD START --><\/p>\n<div id=\"pi-ad\">\n<div id=\"pi-ad-hd\">Want to hear more from the Patient Investor?<\/div>\n<div id=\"pi-ad-content\">\n<div id=\"pi-ad-logo\" align=\"center\">\n<div><img data-recalc-dims=\"1\" decoding=\"async\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/pan\/images\/patient-investor\/patient-investor-logo-2020-10-17.jpg?w=525&#038;ssl=1\" alt=\"\" \/><\/div>\n<div>the patient investor<\/div>\n<\/div>\n<div id=\"pi-ad-offer\" align=\"center\"><a href=\"https:\/\/thepatientinvestor.com\/index.php\/subscribe\/\" target=\"_blank\" rel=\"noopener\"><span style=\"\">Colin Twiggs\u2019 newsletter offers weekly coverage of financial markets and the economy \u2013 including macro trends, key sectors, energy and precious metals.<\/span><span style=\"\"><strong>Subscribe from only $14.50 USD or $19.50 per month<\/strong>. <span style=\"white-space:nowrap;\">No lock-in contracts.<\/span><\/span><span id=\"pi-ad-button\">Subscribe<\/span><\/a><\/div>\n<\/div>\n<\/div>\n<p><!-- AD END --><\/p>\n<\/div><\/p>\n<h2>Stocks<\/h2>\n<p>The S&amp;P 500 plunged to support at 5860. Breach would signal a test of 5700.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-spx.png?resize=525%2C404&#038;ssl=1\" alt=\"S&amp;P 500\" width=\"525\" height=\"404\" \/><\/p>\n<p>Tesla (TSLA) dipped sharply after a spectacular two months, peaking at +117%, compared to Nvidia (NVDA) at -6.6%.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-big7.png?resize=525%2C404&#038;ssl=1\" alt=\"Top 7 Technology Stocks\" width=\"525\" height=\"404\" \/><\/p>\n<p>The weekly chart of the equal-weighted S&amp;P 500 index ($IQX) shows a breach of support at 7150, likely headed for a test of 6900. The lower Trend Index peak identifies selling pressure but is still above zero, indicating that the primary trend remains intact.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-iqx-w.png?resize=525%2C404&#038;ssl=1\" alt=\"S&amp;P 500 Equal-Weighted Index - Weekly\" width=\"525\" height=\"404\" \/><\/p>\n<h2>Financial Markets<\/h2>\n<p>The Chicago Fed National Financial Conditions Index dipped to -0.66% on December 13, indicating &#8220;loose&#8221; monetary conditions. Moody&#8217;s Baa corporate bond spreads are also at a thirty-year low, reflecting easy credit conditions.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-nfci-baa.png?resize=525%2C363&#038;ssl=1\" alt=\"Chicago Fed National Financial Conditions Index &amp; Moody's Baa Corporate Bond Spreads\" width=\"525\" height=\"363\" \/><\/p>\n<p>Bitcoin retraced to test support at $100K, but the strong uptrend still signals abundant financial market liquidity.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-btc.png?resize=525%2C363&#038;ssl=1\" alt=\"Bitcoin (BTC)\" width=\"525\" height=\"363\" \/><\/p>\n<h2>Dollar &amp; Gold<\/h2>\n<p>The Dollar has strengthened in response to rising Treasury yields, with the Dollar Index breaking resistance at 108.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-dxy.png?resize=525%2C404&#038;ssl=1\" alt=\"Dollar Index\" width=\"525\" height=\"404\" \/><\/p>\n<p>The Bank of Japan may be forced to raise interest rates again to support the Yen, which could cause an outflow from US financial markets as carry trades unwind.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-jpy.png?resize=525%2C404&#038;ssl=1\" alt=\"Japanese Yen - Weekly\" width=\"525\" height=\"404\" \/><\/p>\n<p>Gold broke support at $2,625 per ounce, signaling a test of primary support at $2,550.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-gold-d.png?resize=525%2C404&#038;ssl=1\" alt=\"Spot Gold\" width=\"525\" height=\"404\" \/><\/p>\n<p>The long-term uptrend, shown on the weekly chart below, remains intact.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-gold.png?resize=525%2C404&#038;ssl=1\" alt=\"Spot Gold - Weekly\" width=\"525\" height=\"404\" \/><\/p>\n<p>Silver similarly broke support at $30 per ounce, but a breach of primary support at $26.50 remains unlikely.<\/p>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-12-18-silver.png?resize=525%2C404&#038;ssl=1\" alt=\"Spot Silver - Weekly\" width=\"525\" height=\"404\" \/><\/p>\n<h2>Conclusion<\/h2>\n<p>The Fed is riding a wave of deflationary pressure from the global economy, led by China. The bear market in crude oil and copper signals that global demand is contracting. Low inflation should enable further rate cuts next year, but the pace will likely slow as the Fed is wary of a resurgence in domestic demand.<\/p>\n<p>The prospect of inflationary economic policies from the new administration could set off a public feud between Donald Trump and the Fed chairman. Stimulating an economy that is already close to full employment would force the Fed to hike rates to ease inflationary pressures, attracting the ire of the new president.<\/p>\n<p>US financial markets, with rising long-term Treasury yields, are sucking up global liquidity and more than offsetting Fed tightening (QT). The strong Dollar increases pressure on international borrowers in the Eurodollar market as domestic exchange rates weaken. The Bank of Japan may also be forced to hike interest rates again to support the Yen, causing further unwinding of the carry trade and outflows from US financial markets.<\/p>\n<p>The S&amp;P 500 is overdue for a correction, but the primary uptrend is unlikely to reverse unless there is a sharp contraction in financial market liquidity.<\/p>\n<p>Gold and silver are undergoing a sharp correction, but the primary uptrend remains intact. Two long-term fundamental trends support precious metals. First, central banks are increasing their gold reserves and reducing currency reserves as the global sovereign debt bubble expands. Second, in response to a collapsing domestic real estate market, Chinese investors are switching focus to gold and silver as a store of wealth.<\/p>\n<h4>Acknowledgments<\/h4>\n<ul>\n<li>Federal Reserve: <a href=\"https:\/\/www.federalreserve.gov\/newsevents\/pressreleases\/monetary20241218a.htm\">FOMC statement<\/a><\/li>\n<li>Federal Open Market Committee (FOMC): <a href=\"https:\/\/www.federalreserve.gov\/monetarypolicy\/files\/fomcprojtabl20241218.pdf\">Summary of Projections<\/a><\/li>\n<li>Adam Taggart&#8217;s Thoughtful Money\u00ae: <a href=\"https:\/\/adamtaggart.substack.com\/p\/special-report-reaction-to-todays-1e1\">Reaction To Today&#8217;s Federal Reserve Rate Cut Decision<\/a><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Stocks plunged on indications that the Fed would slow further rate cuts after announcing a 25-basis-point cut at the FOMC press conference on Wednesday. Really? That could be seen coming for months. The economy has proven resilient, unemployment is low, and retail sales are growing. The obvious question is: &#8220;Why cut rates at all?&#8221; FOMC &hellip; <\/p>\n<p class=\"link-more\"><a href=\"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;Fed shock &#8211; really?&#8221;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[31,44,5342,6,9,34,35],"tags":[69,5056,6622,1073,6538,6750,6091,5349,3010,3013,3204,3206,6393],"class_list":["post-59987","post","type-post","status-publish","format-standard","hentry","category-the-fed-banks-interest-rates","category-crude-oil-natural-gas","category-cryptocurrency","category-fixed-income","category-gold-precious-metals","category-us-canada-countries-regions","category-us-dollar-index","tag-10-year-treasury-yield","tag-bitcoin-btc","tag-chicago-fed-national-financial-conditions-index","tag-dollar-index","tag-fed-dot-plot","tag-fed-holdings-of-treasuries-mbs","tag-moodys-baa-corporate-bond-spreads","tag-reverse-repo-rrp","tag-sp-500","tag-sp-500-equal-weighted-index","tag-spot-gold","tag-spot-silver","tag-top-7-technology-stocks"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Fed shock - really? - the patient investor<\/title>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fed shock - really? - the patient investor\" \/>\n<meta property=\"og:description\" content=\"Stocks plunged on indications that the Fed would slow further rate cuts after announcing a 25-basis-point cut at the FOMC press conference on Wednesday. Really? That could be seen coming for months. The economy has proven resilient, unemployment is low, and retail sales are growing. The obvious question is: &#8220;Why cut rates at all?&#8221; FOMC &hellip; Continue reading &quot;Fed shock &#8211; really?&quot;\" \/>\n<meta property=\"og:url\" content=\"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/\" \/>\n<meta property=\"og:site_name\" content=\"the patient investor\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/profile.php?id=61572934660810\" \/>\n<meta property=\"article:author\" content=\"https:\/\/facebook.com\/people\/The-Patient-Investor\/61572934660810\/\" \/>\n<meta property=\"article:published_time\" content=\"2024-12-19T05:32:39+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-12-19T11:01:57+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.incrediblecharts.com\/images\/2024\/2024-12-18-dotplot.png\" \/>\n<meta name=\"author\" content=\"Colin Twiggs\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Colin Twiggs\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"7 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/\"},\"author\":{\"name\":\"Colin Twiggs\",\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/#\\\/schema\\\/person\\\/d42b18d516a80149d739845749ac6454\"},\"headline\":\"Fed shock &#8211; really?\",\"datePublished\":\"2024-12-19T05:32:39+00:00\",\"dateModified\":\"2024-12-19T11:01:57+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/\"},\"wordCount\":862,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.incrediblecharts.com\\\/images\\\/2024\\\/2024-12-18-dotplot.png\",\"keywords\":[\"10-Year Treasury Yield\",\"Bitcoin (BTC)\",\"Chicago Fed National Financial Conditions Index\",\"Dollar Index\",\"Fed Dot Plot\",\"Fed Holdings of Treasuries &amp; MBS\",\"Moody's Baa Corporate Bond Spreads\",\"Reverse Repo (RRP)\",\"S&amp;P 500\",\"S&amp;P 500 Equal-Weighted Index\",\"Spot Gold\",\"Spot Silver\",\"Top 7 Technology Stocks\"],\"articleSection\":[\"Banks &amp; Interest Rates\",\"Crude Oil &amp; Natural Gas\",\"Cryptocurrency\",\"Fixed Income\",\"Gold &amp; Precious Metals\",\"US &amp; Canada\",\"US Dollar Index\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/\",\"url\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/\",\"name\":\"Fed shock - really? - the patient investor\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.incrediblecharts.com\\\/images\\\/2024\\\/2024-12-18-dotplot.png\",\"datePublished\":\"2024-12-19T05:32:39+00:00\",\"dateModified\":\"2024-12-19T11:01:57+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/#primaryimage\",\"url\":\"https:\\\/\\\/www.incrediblecharts.com\\\/images\\\/2024\\\/2024-12-18-dotplot.png\",\"contentUrl\":\"https:\\\/\\\/www.incrediblecharts.com\\\/images\\\/2024\\\/2024-12-18-dotplot.png\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/2024\\\/12\\\/19\\\/fed-shock-really\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/thepatientinvestor.com\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Fed shock &#8211; really?\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/#website\",\"url\":\"https:\\\/\\\/thepatientinvestor.com\\\/\",\"name\":\"The Patient Investor\",\"description\":\"Smart. Strategic. Unfiltered. \",\"publisher\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/thepatientinvestor.com\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/#organization\",\"name\":\"The Patient Investor Pty Ltd\",\"url\":\"https:\\\/\\\/thepatientinvestor.com\\\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/#\\\/schema\\\/logo\\\/image\\\/\",\"url\":\"https:\\\/\\\/i0.wp.com\\\/thepatientinvestor.com\\\/wp-content\\\/uploads\\\/2026\\\/03\\\/cropped-cropped-patience-bg-1-inverted-400x400-1.png?fit=250%2C250&ssl=1\",\"contentUrl\":\"https:\\\/\\\/i0.wp.com\\\/thepatientinvestor.com\\\/wp-content\\\/uploads\\\/2026\\\/03\\\/cropped-cropped-patience-bg-1-inverted-400x400-1.png?fit=250%2C250&ssl=1\",\"width\":250,\"height\":250,\"caption\":\"The Patient Investor Pty Ltd\"},\"image\":{\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/#\\\/schema\\\/logo\\\/image\\\/\"},\"sameAs\":[\"https:\\\/\\\/www.facebook.com\\\/profile.php?id=61572934660810\",\"https:\\\/\\\/www.instagram.com\\\/colin_thepatientinvestor\"]},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/thepatientinvestor.com\\\/#\\\/schema\\\/person\\\/d42b18d516a80149d739845749ac6454\",\"name\":\"Colin Twiggs\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/29a4e13250381b203ea835108c2d5eee4947439713c271ae5ba60afb53194432?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/29a4e13250381b203ea835108c2d5eee4947439713c271ae5ba60afb53194432?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/29a4e13250381b203ea835108c2d5eee4947439713c271ae5ba60afb53194432?s=96&d=mm&r=g\",\"caption\":\"Colin Twiggs\"},\"description\":\"Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters. Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis. Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008\\\/2009 and 2020 bear markets well ahead of actual events. He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.\",\"sameAs\":[\"https:\\\/\\\/facebook.com\\\/people\\\/The-Patient-Investor\\\/61572934660810\\\/\",\"https:\\\/\\\/www.instagram.com\\\/colin_thepatientinvestor\",\"https:\\\/\\\/au.linkedin.com\\\/in\\\/colintwiggs\"],\"url\":\"https:\\\/\\\/thepatientinvestor.com\\\/index.php\\\/author\\\/investor\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Fed shock - really? - the patient investor","robots":{"index":"noindex","follow":"follow"},"og_locale":"en_US","og_type":"article","og_title":"Fed shock - really? - the patient investor","og_description":"Stocks plunged on indications that the Fed would slow further rate cuts after announcing a 25-basis-point cut at the FOMC press conference on Wednesday. Really? That could be seen coming for months. The economy has proven resilient, unemployment is low, and retail sales are growing. The obvious question is: &#8220;Why cut rates at all?&#8221; FOMC &hellip; Continue reading \"Fed shock &#8211; really?\"","og_url":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/","og_site_name":"the patient investor","article_publisher":"https:\/\/www.facebook.com\/profile.php?id=61572934660810","article_author":"https:\/\/facebook.com\/people\/The-Patient-Investor\/61572934660810\/","article_published_time":"2024-12-19T05:32:39+00:00","article_modified_time":"2024-12-19T11:01:57+00:00","og_image":[{"url":"https:\/\/www.incrediblecharts.com\/images\/2024\/2024-12-18-dotplot.png","type":"","width":"","height":""}],"author":"Colin Twiggs","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Colin Twiggs","Est. reading time":"7 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/#article","isPartOf":{"@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/"},"author":{"name":"Colin Twiggs","@id":"https:\/\/thepatientinvestor.com\/#\/schema\/person\/d42b18d516a80149d739845749ac6454"},"headline":"Fed shock &#8211; really?","datePublished":"2024-12-19T05:32:39+00:00","dateModified":"2024-12-19T11:01:57+00:00","mainEntityOfPage":{"@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/"},"wordCount":862,"commentCount":0,"publisher":{"@id":"https:\/\/thepatientinvestor.com\/#organization"},"image":{"@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/#primaryimage"},"thumbnailUrl":"https:\/\/www.incrediblecharts.com\/images\/2024\/2024-12-18-dotplot.png","keywords":["10-Year Treasury Yield","Bitcoin (BTC)","Chicago Fed National Financial Conditions Index","Dollar Index","Fed Dot Plot","Fed Holdings of Treasuries &amp; MBS","Moody's Baa Corporate Bond Spreads","Reverse Repo (RRP)","S&amp;P 500","S&amp;P 500 Equal-Weighted Index","Spot Gold","Spot Silver","Top 7 Technology Stocks"],"articleSection":["Banks &amp; Interest Rates","Crude Oil &amp; Natural Gas","Cryptocurrency","Fixed Income","Gold &amp; Precious Metals","US &amp; Canada","US Dollar Index"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/","url":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/","name":"Fed shock - really? - the patient investor","isPartOf":{"@id":"https:\/\/thepatientinvestor.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/#primaryimage"},"image":{"@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/#primaryimage"},"thumbnailUrl":"https:\/\/www.incrediblecharts.com\/images\/2024\/2024-12-18-dotplot.png","datePublished":"2024-12-19T05:32:39+00:00","dateModified":"2024-12-19T11:01:57+00:00","breadcrumb":{"@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/#primaryimage","url":"https:\/\/www.incrediblecharts.com\/images\/2024\/2024-12-18-dotplot.png","contentUrl":"https:\/\/www.incrediblecharts.com\/images\/2024\/2024-12-18-dotplot.png"},{"@type":"BreadcrumbList","@id":"https:\/\/thepatientinvestor.com\/index.php\/2024\/12\/19\/fed-shock-really\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/thepatientinvestor.com\/"},{"@type":"ListItem","position":2,"name":"Fed shock &#8211; really?"}]},{"@type":"WebSite","@id":"https:\/\/thepatientinvestor.com\/#website","url":"https:\/\/thepatientinvestor.com\/","name":"The Patient Investor","description":"Smart. Strategic. Unfiltered. ","publisher":{"@id":"https:\/\/thepatientinvestor.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/thepatientinvestor.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/thepatientinvestor.com\/#organization","name":"The Patient Investor Pty Ltd","url":"https:\/\/thepatientinvestor.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/thepatientinvestor.com\/#\/schema\/logo\/image\/","url":"https:\/\/i0.wp.com\/thepatientinvestor.com\/wp-content\/uploads\/2026\/03\/cropped-cropped-patience-bg-1-inverted-400x400-1.png?fit=250%2C250&ssl=1","contentUrl":"https:\/\/i0.wp.com\/thepatientinvestor.com\/wp-content\/uploads\/2026\/03\/cropped-cropped-patience-bg-1-inverted-400x400-1.png?fit=250%2C250&ssl=1","width":250,"height":250,"caption":"The Patient Investor Pty Ltd"},"image":{"@id":"https:\/\/thepatientinvestor.com\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/profile.php?id=61572934660810","https:\/\/www.instagram.com\/colin_thepatientinvestor"]},{"@type":"Person","@id":"https:\/\/thepatientinvestor.com\/#\/schema\/person\/d42b18d516a80149d739845749ac6454","name":"Colin Twiggs","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/29a4e13250381b203ea835108c2d5eee4947439713c271ae5ba60afb53194432?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/29a4e13250381b203ea835108c2d5eee4947439713c271ae5ba60afb53194432?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/29a4e13250381b203ea835108c2d5eee4947439713c271ae5ba60afb53194432?s=96&d=mm&r=g","caption":"Colin Twiggs"},"description":"Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters. Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis. Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008\/2009 and 2020 bear markets well ahead of actual events. He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.","sameAs":["https:\/\/facebook.com\/people\/The-Patient-Investor\/61572934660810\/","https:\/\/www.instagram.com\/colin_thepatientinvestor","https:\/\/au.linkedin.com\/in\/colintwiggs"],"url":"https:\/\/thepatientinvestor.com\/index.php\/author\/investor\/"}]}},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p9tQ4n-fBx","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":62298,"url":"https:\/\/thepatientinvestor.com\/index.php\/2025\/08\/20\/this-fomc-meeting-will-be-a-watershed\/","url_meta":{"origin":59987,"position":0},"title":"This FOMC meeting will be a watershed","author":"Colin Twiggs","date":"August 20, 2025","format":false,"excerpt":"Key Points Stocks have stalled ahead of the FOMC decision from the Fed Housing permits confirm weak consumer sentiment The S&P 500 retreated ahead of the interest rate decision from the Fed. A breach of support at 6400 would warn of a correction. The Dow Jones Industrial Average has encountered\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"S&P 500","src":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2025\/2025-08-19-spx.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2025\/2025-08-19-spx.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2025\/2025-08-19-spx.png?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":62459,"url":"https:\/\/thepatientinvestor.com\/index.php\/2025\/09\/18\/62459\/","url_meta":{"origin":59987,"position":1},"title":"Powell walks the tightrope with the latest FOMC decision","author":"Colin Twiggs","date":"September 18, 2025","format":false,"excerpt":"Key Points The Fed cut rates by 25 basis points, with two more expected this year. There is no change to the rate of Fed balance sheet runoff (QT). FOMC dot plot projections reflect a mildly dovish long-run monetary policy, but not sufficient to antagonize the bond market. Chair Jerome\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"FOMC Projections","src":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2025\/2025-09-17-fomc.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":50189,"url":"https:\/\/thepatientinvestor.com\/index.php\/2024\/03\/21\/gold-and-sp-500-break-to-new-highs\/","url_meta":{"origin":59987,"position":2},"title":"Gold and S&#038;P 500 break to new highs","author":"Colin Twiggs","date":"March 21, 2024","format":false,"excerpt":"https:\/\/www.youtube.com\/live\/DAkSmobTi8E?si=hCSpR9PwS0DXZ7Ai The FOMC decided to hold rates steady, with a target range of 5.25% to 5.50%. But they project three rate cuts by the end of the year, with a mid-point at 4.625%. Fed securities holdings have so far been reduced by almost $1.5 trillion. FOMC consensus is to slow\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"FOMC Dot Plot","src":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-03-20-dotplot.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-03-20-dotplot.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-03-20-dotplot.png?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":57614,"url":"https:\/\/thepatientinvestor.com\/index.php\/2024\/09\/18\/rate-cut-likely-to-boost-stocks-and-gold\/","url_meta":{"origin":59987,"position":3},"title":"Rate cut likely to boost stocks and gold","author":"Colin Twiggs","date":"September 18, 2024","format":false,"excerpt":"Financial markets paused ahead of the FOMC announcement on Wednesday. A rate cut of at least 25 basis points is widely anticipated, while expectations of 50 basis points are growing. Stocks The S&P 500 is testing resistance at the July high of 5670. The equal-weighted index broke resistance at 7100\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"S&P 500","src":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-09-17-spx.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-09-17-spx.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2024\/2024-09-17-spx.png?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":46393,"url":"https:\/\/thepatientinvestor.com\/index.php\/2023\/12\/14\/dovish-fed-dollar-falls-gold-climbs\/","url_meta":{"origin":59987,"position":4},"title":"Dovish Fed, Dollar falls, Gold climbs","author":"Colin Twiggs","date":"December 14, 2023","format":false,"excerpt":"Long-term Treasury yields plunged in response to a dovish Fed meeting which kept rates on hold, with a target range of 5.25% - 5.00%. Ten-year Treasury yields are now testing our target at 4.0%. Declining inflation and signs of labor market easing moved the FOMC to discard the additional rate\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"10-Year Treasury Yield","src":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2023\/2023-12-14-10y-666x451.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2023\/2023-12-14-10y-666x451.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2023\/2023-12-14-10y-666x451.png?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":59113,"url":"https:\/\/thepatientinvestor.com\/index.php\/2024\/11\/08\/fed-calms-market-jitters\/","url_meta":{"origin":59987,"position":5},"title":"Fed calms market jitters","author":"Colin Twiggs","date":"November 8, 2024","format":false,"excerpt":"Fed chairman Jerome Powell confirmed market expectations by announcing a 25 basis-point rate cut, lowering the target range for the fed funds rate to 4.5 to 4.75 percent. Notable from Powell\u2019s prepared remarks: We\u2019re confident inflation will get to 2% Economic activity is expanding at a \u201csolid pace\u201d Growth in\u2026","rel":"","context":"In &quot;Australia &amp; NZ&quot;","block_context":{"text":"Australia &amp; NZ","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/countries-regions\/australia-nz-countries-regions\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/thepatientinvestor.com\/wp-content\/uploads\/2024\/08\/jpowell.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]}],"_links":{"self":[{"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/posts\/59987","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/comments?post=59987"}],"version-history":[{"count":10,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/posts\/59987\/revisions"}],"predecessor-version":[{"id":60009,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/posts\/59987\/revisions\/60009"}],"wp:attachment":[{"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/media?parent=59987"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/categories?post=59987"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/tags?post=59987"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}