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Mr. Market started seriously pricing in the possibility of interest rate cuts.

To be fair, the signal came from the Top of the economic politburo that matters that being the Federal Reserve.

Speaking at an event at the Chicago Fed last Tuesday, Chairman Jerome Powell hinted that the Fed would likely cut rates to keep the economic expansion going.

With stocks still within 10% of their all-time highs, the soothing words may just be enough to avoid another selloff.

But it may also finally spark the final late-Bull market rally that gets fearful investors to throw away the fear and embrace the greed.

That’s how Bull markets die, not of old age. They die on speculative greed, as in Y’s 1929, 2000, and 2008 among other dates in between.

Consequently, the market is vastly increasing the odds of a cut in interest rates by the end of the year, maybe even 2 years.

Given that interest rates are at 2%, and at this stage in past market rallies they have been averaging closer to 4-6% that is not a huge vote of confidence on the economy right now.

In other words, the Fed is spiking the punchbowl while we’re still riding the euphoria of the near-Zero % interest rates of Ys’ 2008-2015.

The job of the Fed is to be just the opposite.

Fed Chairman William McChesney Martin, who headed the agency from Ys 1951 to 1970, is best known today for saying it’s the Fed’s job to take away the punch-bowl as the party gets going.

But that is the Fed at work. Rather than try to act as a brake on the economy when it’s running hot, or getting...

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