Morning kings.
No time to waste.
I was up all night so I figured I might as well drop some quick thoughts ahead of Jerome Powell’s rate cut decision today.
Nobody knows exactly what he’s going to do but we can come up with a pretty good idea based on the current odds as of this morning and some of the market action yesterday.
Markets are almost fully pricing in a 25 basis point cut, with odds sitting in the mid-90% range. A larger 50 basis point cut carries only a small chance, roughly single digits, while the probability of no move at all is just a couple percent. Any possibility of a rate hike is essentially zero (though not impossible).
Today I want to quickly talk through the following:
What I think happens today
A handful of stock and crypto picks I’m ramping up before Powell’s presser, and some that are gaining a large amount of attention from retail
How aggressive cuts will impact certain industries
Expectations for performance through year end
Today is likely the day the Federal Reserve finally pivots. That being said there are large numbers of influencers, pundits, traders, and other folks who say that:
a.) it’s priced in
b.) it’s the top and a sell the news event
There could be some truth to this, but generally speaking, I am inclined to NOT agree with the majority. This has served me well in many areas of life outside of markets and in this particular instance I think it will pay to at least explore the idea that we are going to continue higher in the medium term regardless of what ends up happening today.
I ran a poll on X and got the opposite expectation — the majority of respondents think we are going to pump.
So what do we make of all the panic, top calling, and emotion this week?
It’s all noise and even if it’s baked in, do you really think crypto and growth tech/AI aren’t going to be absurdly higher in 2026 and beyond?
The Bank of Canada cut rates 25 bps to 2.5%, matching most estimates this morning. Standard Chartered and Societe Generale are saying there will be a 50bps cut today.
Historically, the S&P 500 tends to perform well after the Fed starts cutting rates. This of course isn’t a guarantee given the absurd environment we are in right now but it can give us a reference. Looking back over the past few decades, the index has averaged double-digit gains in the 12 months following the first cut, with returns closer to 20% when the economy avoids recession.
This path is by no means smooth, it’s common to see chop or even downside in the first 1–3 months as markets digest the shift, before momentum builds later in the easing cycle (which is a main reason I have shifted our timeline re:crypto in spring of 2026).
The real kicker is that rate cuts usually usher in a regime of cheaper money and looser conditions, which tends to fuel growth stocks, tech, and high-beta names.
At the end of the day, this is a liquidity story, and history shows liquidity usually wins. Whether it’s today or in the months ahead, the setup favors another leg higher for the risk assets we actually care about.
Let’s dive into the names and trades that could run hardest into year-end. It’s time to take advantage of the paper hands and emotional investors who will cough up at the first sign of a “sell the news” reaction today.