Despite the optimism, there are reasons to be cautious about the projected 2024 returns. Federal Reserve Chair Jerome Powell emphasized that the projected 2024 cuts are merely a projection and that the path forward is uncertain due to ongoing high inflation. Furthermore, some market experts, including Wall Street guru Jim Grant, have pointed out that the purchasing power lost from inflation is not likely to return. Therefore, investors are advised to hold off on making big spending plans for 2024 for the time being.
Key takeaways:
- The Dow Jones Industrial Average hit an all-time high following the Federal Reserve's announcement that they would hold off on raising interest rates and are projecting three rate cuts for 2024.
- However, some Wall Street banks, such as UBS, are questioning if the market is becoming overconfident, citing the ultra-low levels of the VIX index as an example of investors getting ahead of themselves.
- Fed Chair Powell warned that the projected 2024 cuts are just a projection and that inflation is still a concern, advising investors to not count their chickens before they hatch.
- Other market news includes the correlation between a low approval rating for the US president and better market returns, the expected launch of the largest-ever hedge fund by Bobby Jain, and a 2.1% year-over-year decline in the US median asking rent for November.