As of right now, 9:55AM when we write this article the Fed has not yet announced it will cut rates or by how much.
But Wall Street hates to be disappointed and anything less than 50BPS will likely cause some selling today.
However, the S&P 500 is ALWAYS, ALWAYS higher after a rate cut when stocks are at all time highs 1 year later.
So hang tight out there. Hold onto the stocks you believe. Continue to build your Forever Portfolio like we advocate for here at Rocket2Riches.
It’s the Rocket Plays you need to double-down on your conviction with. Small caps are going to absolutely skyrocket in a rate cut environment so don’t let short term pain affect your long term gain.
A couple other reasons the market is painful today:
1. uncertainty. Wall Street hates not knowing what will happen, so they take profits and sell the day rather than buy it.
2. China is banning NVIDIA chips. Though knowing China they will reverse course when they realize what a stupid move they’ve made. This is just how it is in their long and painful history.
3. NVIDIA going down is bringing everything down, it’s the world’s largest company right now
4. Tariffs are still ongoing and that’s got everyone spooked. It only takes a tweet from the president right now to add more uncertainty (see reason #1)
5. Speaking of the President, the shakeups at The Fed and wanting to replace everyone who doesn’t agree with his vision also creates uncertainty. Wall Street wants to know the Fed is going to be pro business, on their side, etc, so they’re on edge.
If you’re like us, you like to buy on down days.
The stock market however is one of the only places where nobody shops when things go on sale.
Go to any other store in America and you’ll see people BOGO’ing their brains out. Applying promo codes to their shopping cart online. Googling and making sure it’s not cheaper somewhere else online.
But when it comes to investing? NONE of that due dilligence ever enters the picture on a down day in the markets. Human psychology is hard to overcome and fear is what’s kept us alive this long. So it’s difficult to add to your Forever Portfolio on days like these.
But it almost always pays off in our experience.
We’ll post again after the Fed cuts rates…
But since everyone is allowed to through out their predictions nowadays, we’ll just go ahead and guess they’ll go big with a jumbo cut. Jobs are in the toilet, inflation is still out there and I assume most people at The Fed want to keep their job.
But no matter WHAT happens…
Keep stacking assets, regardless of the outcome.
