Stephan Schnee · 2024-09-18T18:39:54.686224Z

$O Interest rates are finally lowered after 4 years and what does Realty Income do? It drops sharply at first, of course :-D The stock market is a bit sick, isn't it?

9Mo

Because the stock market is not as simple as you imagine.
It was completely priced in that interest rates would be lowered. However, as 0.25 was expected, the "big" move came as a surprise. Now there is a brief panic because it could mean that there is no soft landing in the USA after all but a hard recession

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Stephan Schnee@MrCumEx

9Mo

@Barrd Yes, the stock market is just like a bitchy woman ;-)

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Jan K.@Ilu92

9Mo

@Barrd Where did you get the idea that 0.25 was calculated?
It was priced at 0.5 with over 60% probability according to watchtool. Accordingly, it turned out as the market expected.

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Jan@Barrd

9Mo

@Ilu92 because only 0.25 was fed in over the last few weeks/months. The 0.5 only came into focus in the last two weeks. Which was ultimately the right thing to do

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Ti M.@douc1t

9Mo

@Barrd is all true, but why is everything else going up right now? Tech and co wouldn't be happy about a hard recession either 🤔

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Jan@Barrd

9Mo

@douc1t Powell's speech afterwards was very good. It dispelled the worries of the investments for the time being.
First the cut is announced and then the Fed chief always gives a speech where he explains everything further.
And in this case it was reassuring :)

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Lama@MLana

9Mo

Well, I wouldn't call <2% strong.

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Stephan Schnee@MrCumEx

9Mo

@MLana It is more than just strong for the fact that interest rates were cut sharply today. Normally, the share price would have to rise sharply because the market was only expecting a 0.25% cut....

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Ayecaramba@Ayecaramba256

9Mo

@MrCumEx so 65% 0.5 was expected

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Stephan Schnee@MrCumEx

9Mo

@Ayecaramba256 falsch.

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Kai@Dividenden-Sammler

9Mo

@MrCumEx ne correct - the majority assumed 0.5%.

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Lama@MLana

9Mo

@MrCumEx The market is never "normal".

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Stephan Schnee@MrCumEx

9Mo

@Dividenden-Sammler hier Lügner! https://www.t-online.de/finanzen/aktuelles/wirtschaft/id_100492530/zinswende-in-den-usa-notenbank-fed-senkt-leitzins-ueberraschend-deutlich.html

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Stephan Schnee@MrCumEx

9Mo

@Ayecaramba256 The US Federal Reserve has started the downward turn in interest rates - with an unusually large step. It lowered the key interest rate by half a percentage point to the new range of 4.75 to 5.00 percent. https://www.tagesschau.de/wirtschaft/finanzen/fed-leitzins-senkung-100.html

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Stephan Schnee@MrCumEx

9Mo

@Dividenden-Sammler Interest rate cut higher than expectedIt was considered a foregone conclusion that the Fed would initiate a turnaround in interest rates. It was unclear how big the interest rate cut would be. Many economists had previously expected a smaller move of a quarter of a percentage point. The cut marks a turning point in interest rate policy, as the Federal Reserve had kept interest rates in the range of 5.25 to 5.50 percent for over a year in the fight against stubbornly high inflation.

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Kai@Dividenden-Sammler

9Mo

@MrCumEx According to CME FedWatch, a 0.5% move was considered likely at around 65% - a 0.25% move was only around 35%.

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Stephan Schnee@MrCumEx

9Mo

@Dividenden-Sammler has changed every day. Nevertheless, everyone is now writing that it's a big surprise!

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Voir toutes les 9 autres réponses

Tom@Tomtom12

9Mo

Then just buy more

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Stephan Schnee@MrCumEx

9Mo

@Tomtom12 Position is full.

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Woods@Woods

9Mo

If the stock market were predictable, we would all be millionaires.

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Miraglia D.@Danilo84

9Mo

I think it will fall even further in the short term. But that's a good way to buy cheaper :)

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Stephan Schnee@MrCumEx

9Mo

@Danilo84 Yes, it will probably rise again tomorrow or the day after tomorrow anyway. It's already recovering....

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gui H.@useref748d772fc84f3e

9Mo

The "sharp" interest rate cut can also be seen as a premonition of an economic crash.

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Stephan Schnee@MrCumEx

9Mo

@useref748d772fc84f3e Yes, anything is possible....

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DerMartin@DerMartin

9Mo

No. The stock market is just not as "normal" as you would like it to be. That's why experience is so valuable. Because you can hardly learn this complexity from textbooks.

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Stephan Schnee@MrCumEx

9Mo

@DerMartin yes I think realty income will really rise today

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