Markets Rally on Rate Cut Hopes, But Cuts Could Signal Economic Trouble Ahead
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Markets are cheering the possibility of Fed rate cuts in 2023, but cuts would likely signal a slowing economy.
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Rate cuts aren't inherently bullish - the Fed often cuts when the economy is headed towards recession.
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JPMorgan strategist estimates stocks could fall 20% in a recession; rate cuts may not prevent a downturn.
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Signs of economic slowdown emerging GDP growth slowed last quarter, retail spending declined in October.
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Sahm recession indicator flashing warning signs as unemployment rate ticks higher and job growth slows.