Bloomberg Surveillance
Potential Rate Cuts on Fed Day and Harris-Trump on the Economy
Sep 18, 2024
Alicia Levine, Head of Equities at BNY Wealth Management, shares her insights on the uncertainty surrounding potential Fed rate cuts through 2025 and their implications for risk assets. Jason Furman, Professor of Practice in Economic Policy at Harvard Kennedy School, discusses economic policies under Trump and Harris, exploring how presidential leadership shapes economic outlooks. The duo also delves into the Federal Reserve's cautious stance on interest rates and the potential fallouts of tariffs on consumers and trade.
35:45
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Quick takeaways
- As the Fed's rate cuts approach, certain equity sectors like REITs and financials are expected to thrive, despite potential market volatility.
- Concerns about potential tariff policies highlight risks to the U.S. economy, emphasizing the importance of thoughtful negotiation strategies.
Deep dives
Current Market Dynamics and Fed Actions
The financial landscape currently shows signs of a significant turn, particularly following the Fed's pivot in December. This pivotal moment has led to an increase in market activity, with the market up 19% year to date. As the Fed begins to cut rates, there is an expectation of market volatility, but historical trends suggest that being in the bond market during such times is advantageous. Notably, the market's anticipation of these cuts suggests that investors should carefully consider their positions in both bonds and equities.
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