Today I want to dive into yesterdays Fed rate cut which came in at 25 points. Honestly this was lower as I was expecting a 50 point cut again however there is still another meeting in December in which we should see another 25 points come off.

This is starting to get into the territory of where people can start borrowing money again and start being more open to selling off their home and moving instead of staying stuck because of a crazy high mortgage rate.

There's a lot of things going for both the stock market and the crypto markets. With Trump winning the election, Fed interest rates coming down and an overall positive outlook for the future of things once again it's hard to think anything other then a major bull run coming for both stocks and crypto.

But is that the case?

When we look deeper the stock market has been increasing at crazy rates already which is primarily fueled by what is called the Magnificent 7. This is Apple, Microsoft, Google parent Alphabet, Amazon, Nvidia, Meta and Tesla. But most of these stocks and companies honestly feel pretty maxed out at the moment.

It's pretty hard to see these stocks having anymore big gains so that could mean the stock market is a bit overstretched already. Making it that even though things are looking good the stock market most likely could be in for some rather mediocre rises over the next few years.

But here's the wild part for Crypto in my opinion. Because of the underperformance of the stock market most likely going to happen the crypto markets should actully explode being that people will be still looking for better than inflation returns and crypto is the one place that can for sure offer that compared to the overly saturated and hyped up stock market.

Mortgage Rates

Another hot topic around all of this is of course real estate and confusion on how mortgages work. Most are thinking because the fed has decreased rates the mortgage rates will fall. And while yes this is true it's going to be far slower to act and that's because most banks and mortgage rates factor in the 10 year rate and not some flash in the pan change that the FED does. Instead the FED rates are more on target to the rates from up to 6 month treasury bonds and the rate cuts don't really mean anything until you start to spread out over years as everything else is more sluggish.

To me all of this is leading into a core focus into crypto at least for 2025 and seeing what happens after that point. What are your thoughts?

*This article is for entertainment purposes only and is not financial advice. In short do your own research and take responsibility for your own actions.

Posted Using InLeo Alpha