All News is Bad News

Lately, it seems that any and all news causes the stock market to decline.  Probably what ever the Fed does tomorrow will do the same. 

• Raise interest rates - This is the most likely scenario.   The stock market will view this as too aggressive since the economy is already slowing down and heading towards recession.   Even with a dovish 2019 forecast, an interest rate increase will be viewed as too hawkish.  Result - the market declines.
• No change to interest rates - This is a possibility.   The stock market will view this as an acknowledgement the Fed has already raised interest rates too much and is concerned about causing a recession.   Result - the market declines.
• Lower interest rates - This is unlikely.   The stock market will view this as a recession being imminent.  Result - the market declines significantly.

12 of the last 13 times the Fed raised interest rates, a recession occurred.  The market knows this and that's why all the Fed news tomorrow will be bad news for the stock market.

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This is not financial or investment advice. Please consult a professional advisor.

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