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2021-11-09

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Opinion: Why a Fed rate hike could be just the medicine stocks need to keep this bull market going<blockquote>观点：为什么美联储加息可能只是股市维持牛市所需的良药</blockquote>

How should stock market investors react when the U.S. Federal Reserve begins to raise the Federal Fu

Opinion: Why a Fed rate hike could be just the medicine stocks need to keep this bull market going<blockquote>观点：为什么美联储加息可能只是股市维持牛市所需的良药</blockquote>

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{"i18n":{"language":"zh_CN"},"data":{"magic":2,"id":844269946,"tweetId":"844269946","gmtCreate":1636431603110,"gmtModify":1636431818187,"author":{"id":3574898254285562,"idStr":"3574898254285562","authorId":3574898254285562,"authorIdStr":"3574898254285562","name":"TendousTendy","avatar":"https://static.tigerbbs.com/925947ffc7566aad9cffa7ce79ddf982","vip":1,"userType":1,"introduction":"","boolIsFan":false,"boolIsHead":false,"crmLevel":11,"crmLevelSwitch":0,"individualDisplayBadges":[],"wearingBadges":[],"fanSize":10,"starInvestorFlag":false},"themes":[],"images":[],"coverImages":[],"title":"","extraTitle":"","html":"<html><head></head><body>Delusional</body></html>","htmlText":"<html><head></head><body>Delusional</body></html>","text":"Delusional","highlighted":1,"essential":1,"paper":1,"likeSize":4,"commentSize":0,"repostSize":0,"favoriteSize":0,"link":"https://laohu8.com/post/844269946","repostId":1182010893,"repostType":2,"repost":{"id":"1182010893","kind":"news","pubTimestamp":1636426760,"share":"https://www.laohunote.com/m/news/1182010893?lang=zh_CN&edition=full","pubTime":"2021-11-09 10:59","market":"us","language":"en","title":"Opinion: Why a Fed rate hike could be just the medicine stocks need to keep this bull market going<blockquote>观点：为什么美联储加息可能只是股市维持牛市所需的良药</blockquote>","url":"https://stock-news.laohu8.com/highlight/detail?id=1182010893","media":"Market Wacth","summary":"How should stock market investors react when the U.S. Federal Reserve begins to raise the Federal Fu","content":"How should stock market investors react when the U.S. Federal Reserve begins to raise the Federal Funds rate? That question, in <a href=\"https://laohu8.com/S/AONE.U\">one</a> form or another, is being asked by almost all investors these days. While no <a href=\"https://laohu8.com/S/AONE.U\">one</a> knows for sure when the Fed’s rate hike cycle will begin, it could happen soon —perhaps by the end of the year. With the Fed funds rate near zero and the U.S. economy growing, the question is when, not if.<blockquote>当美联储开始上调联邦基金利率时，股市投资者该如何反应？这个问题，在<a href=\"https://laohu8.com/S/AONE.U\">一</a>如今，几乎所有投资者都在询问这种或那种形式。虽然没有<a href=\"https://laohu8.com/S/AONE.U\">一</a>美联储加息周期何时开始，可能很快就会开始--也许在今年年底。随着联邦基金利率接近于零，美国经济不断增长，问题是何时，而不是是否。</blockquote> Conventional wisdom dictates that rate increases are bad news. Higher rates mean that stocks face stiffer competition from bonds. It also means that stocks are worth less, according to standard discounted cash flow analysis: Higher rates mean that the present value of stocks’ future earnings and dividends are lower.<blockquote>传统观点认为加息是坏消息。更高的利率意味着股票面临来自债券的更激烈竞争。根据标准贴现现金流分析，这也意味着股票的价值降低： 较高的利率意味着股票未来收益和股息的现值较低。</blockquote> Yet it’s surprisingly difficult to support this conventional wisdom with historical data. In fact, the S&amp;P 500SPX,+0.09%has performed better in the wake of Fed decisions to raise the Fed funds rate than in the wake of rate cuts, on average.<blockquote>然而，用历史数据来支持这种传统观点却出奇地困难。事实上，平均而言，标准普尔 500SPX,+0.09% 在美联储决定提高联邦基金利率后的表现好于降息后的表现。</blockquote> I reached this conclusion upon analyzing all rate hike increases and decreases announced by the Federal Reserve’s Open Market Committee (FOMC) dating back to 1990. For each rate change decision I calculated the S&amp;P 500’s total return from the date of the increase, either over the subsequent 12 months or until the date of the FOMC’s next rate change decision, whichever came first. The results are summarized in the table below.<blockquote>我是在分析了美联储公开市场委员会（FOMC）自 1990 年以来宣布的所有加息和降息后得出这一结论的。对于每次利率变动决定，我计算了标普500从加息之日起、随后 12 个月内或直到联邦公开市场委员会下一次利率变动决定之日（以先到者为准）的总回报。结果总结在下表中。</blockquote> <img src=\"https://static.tigerbbs.com/8e2f1f93d49dd2c6accbf0ab1aac2787\" tg-width=\"700\" tg-height=\"471\" referrerpolicy=\"no-referrer\"><blockquote></blockquote> If other things were equal, these results would suggest that investors actually prefer higher rates. But, as is so often the case, things are not equal. For example, as Eric Swanson told me in an interview, the Fed raises rates when it worries that the economy may be overheating. Swanson is a finance professor at the University of California, Irvine. Since the stock market typically does well when the economy is firing on all cylinders, it’s not particularly surprising that the stock market will do well, on average, during a rate-hike cycle.<blockquote>如果其他条件相同，这些结果表明投资者实际上更喜欢更高的利率。但是，正如经常发生的那样，事情并不平等。例如，正如埃里克·斯旺森在一次采访中告诉我的那样，当美联储担心经济可能过热时，它就会加息。斯旺森是加州大学欧文分校的金融学教授。由于股市通常在经济全速前进时表现良好，因此在加息周期中，股市平均表现良好也就不足为奇了。</blockquote> For similar reasons, it’s not surprising that the stock market will struggle during a rate-cut cycle. That’s because the FOMC will cut the Fed funds rate when it is worried that the economy is in danger of contracting. For a recent example of that, just think back to the waterfall decline in February and March of 2020 that was precipitated by the COVID-19 pandemic.<blockquote>出于类似的原因，股市在降息周期中陷入困境也就不足为奇了。这是因为当联邦公开市场委员会担心经济有收缩的危险时，它会下调联邦基金利率。最近的一个例子，只要回想一下2020年2月和3月由新冠肺炎疫情引发的瀑布式下跌。</blockquote> Other tools in the Fed tool chest<blockquote>Fed工具箱中的其他工具</blockquote> There are two other big reasons why the stock market doesn’t react to rate hikes in the way conventional wisdom would suggest. The first is that the Federal Reserve in recent years has become increasingly transparent, telegraphing to the markets well in advance about when it may change the Fed funds rate. This means that the stock market will have had plenty of time to react by the time a rate hike actually occurs.<blockquote>股市对加息的反应并不像传统观点那样，还有另外两大原因。首先，美联储近年来变得越来越透明，提前向市场发出何时可能改变联邦基金利率的电报。这意味着当加息实际发生时，股市将有充足的时间做出反应。</blockquote> This certainly has been the case this year, for example. For a number of months now, the Fed has explicitly announced its intention to begin tapering its monetary stimulus. In addition, the Fed circulates a “dot plot” after each rate-setting meeting showing FOMC members’ projections of where the Fed funds rate will be in coming months.<blockquote>例如，今年的情况确实如此。几个月来，美联储已经明确宣布打算开始缩减货币刺激措施。此外，美联储在每次利率制定会议后都会分发一份 “点阵图”，显示联邦公开市场委员会成员对未来几个月联邦基金利率走势的预测。</blockquote> Advisers often say: “Buy the rumor, sell the news.” This appears to apply here, making it difficult to measure the stock market’s reaction to higher rates. What appears to be the poor performance during a rate-cutting cycle might in fact be anticipation of the beginning of a rate-hike cycle.<blockquote>顾问们常说：“买谣言，卖新闻”。这似乎也适用于这里，因此很难衡量股市对加息的反应。降息周期中看似糟糕的表现，实际上可能是对加息周期开始的预期。</blockquote> The other reason the stock market doesn’t always react in predictable ways to rate hike decisions: The Fed in recent years has increasingly relied on large-scale asset purchases in addition to changing the Fed funds rate —otherwise known as quantitative easing (QE).<blockquote>股市并不总是以可预测的方式对加息决定做出反应的另一个原因是： 近年来，美联储除了改变联邦基金利率外，还越来越依赖大规模资产购买--也就是所谓的量化宽松（QE）。</blockquote> Indeed, according to research from UC Irvine’s Swanson, QE appears to have just as much impact on the stock market as cutting the Fed funds rate used to have in the decades before any of us had ever heard of QE. The study, “Measuring the Effects of Federal Reserve Forward Guidance and Asset Purchases on Financial Markets,” appeared in the March 2021 issue of theJournal of Monetary Economics. In fact, Swanson reports that, in a zero-Fed-funds world, QE may have even more impact on the stock market than rate changes.<blockquote>事实上，根据加州大学欧文分校斯旺森分校的研究，量化宽松对股市的影响似乎与我们听说过量化宽松之前的几十年里联邦基金利率的下调一样大。这项名为 “衡量美联储前瞻性指引和资产购买对金融市场的影响 ”的研究发表在 2021 年 3 月号的《金融市场》杂志上。货币经济学杂志事实上，斯旺森报告说，在一个零联邦基金的世界里，量化宽松对股市的影响可能比利率变化还要大。</blockquote> The bottom line? It’s not the case that a Fed funds rate hike is good news. But, at the same time, there is no easy, straightforward or mechanical way in which you can use changes to the Fed funds rate to time the stock market.<blockquote>底线？联邦基金加息并非好消息。但是，与此同时，没有简单、直接或机械的方法可以利用联邦基金利率的变化来确定股市的时机。</blockquote>","source":"lsy1604288433698","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Opinion: Why a Fed rate hike could be just the medicine stocks need to keep this bull market going<blockquote>观点：为什么美联储加息可能只是股市维持牛市所需的良药</blockquote></title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 12.5px; color: #7E829C; margin: 0;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nOpinion: Why a Fed rate hike could be just the medicine stocks need to keep this bull market going<blockquote>观点：为什么美联储加息可能只是股市维持牛市所需的良药</blockquote>\n</h2>\n<h4 class=\"meta\">\n\nMarket Wacth2021-11-09 10:59\n\n</h4>\n</header>\n<article>\nHow should stock market investors react when the U.S. Federal Reserve begins to raise the Federal Funds rate? That question, in <a href=\"https://laohu8.com/S/AONE.U\">one</a> form or another, is being asked by almost all investors these days. While no <a href=\"https://laohu8.com/S/AONE.U\">one</a> knows for sure when the Fed’s rate hike cycle will begin, it could happen soon —perhaps by the end of the year. With the Fed funds rate near zero and the U.S. economy growing, the question is when, not if.<blockquote>当美联储开始上调联邦基金利率时，股市投资者该如何反应？这个问题，在<a href=\"https://laohu8.com/S/AONE.U\">一</a>如今，几乎所有投资者都在询问这种或那种形式。虽然没有<a href=\"https://laohu8.com/S/AONE.U\">一</a>美联储加息周期何时开始，可能很快就会开始--也许在今年年底。随着联邦基金利率接近于零，美国经济不断增长，问题是何时，而不是是否。</blockquote> Conventional wisdom dictates that rate increases are bad news. Higher rates mean that stocks face stiffer competition from bonds. It also means that stocks are worth less, according to standard discounted cash flow analysis: Higher rates mean that the present value of stocks’ future earnings and dividends are lower.<blockquote>传统观点认为加息是坏消息。更高的利率意味着股票面临来自债券的更激烈竞争。根据标准贴现现金流分析，这也意味着股票的价值降低： 较高的利率意味着股票未来收益和股息的现值较低。</blockquote> Yet it’s surprisingly difficult to support this conventional wisdom with historical data. In fact, the S&amp;P 500SPX,+0.09%has performed better in the wake of Fed decisions to raise the Fed funds rate than in the wake of rate cuts, on average.<blockquote>然而，用历史数据来支持这种传统观点却出奇地困难。事实上，平均而言，标准普尔 500SPX,+0.09% 在美联储决定提高联邦基金利率后的表现好于降息后的表现。</blockquote> I reached this conclusion upon analyzing all rate hike increases and decreases announced by the Federal Reserve’s Open Market Committee (FOMC) dating back to 1990. For each rate change decision I calculated the S&amp;P 500’s total return from the date of the increase, either over the subsequent 12 months or until the date of the FOMC’s next rate change decision, whichever came first. The results are summarized in the table below.<blockquote>我是在分析了美联储公开市场委员会（FOMC）自 1990 年以来宣布的所有加息和降息后得出这一结论的。对于每次利率变动决定，我计算了标普500从加息之日起、随后 12 个月内或直到联邦公开市场委员会下一次利率变动决定之日（以先到者为准）的总回报。结果总结在下表中。</blockquote> <img src=\"https://static.tigerbbs.com/8e2f1f93d49dd2c6accbf0ab1aac2787\" tg-width=\"700\" tg-height=\"471\" referrerpolicy=\"no-referrer\"><blockquote></blockquote> If other things were equal, these results would suggest that investors actually prefer higher rates. But, as is so often the case, things are not equal. For example, as Eric Swanson told me in an interview, the Fed raises rates when it worries that the economy may be overheating. Swanson is a finance professor at the University of California, Irvine. Since the stock market typically does well when the economy is firing on all cylinders, it’s not particularly surprising that the stock market will do well, on average, during a rate-hike cycle.<blockquote>如果其他条件相同，这些结果表明投资者实际上更喜欢更高的利率。但是，正如经常发生的那样，事情并不平等。例如，正如埃里克·斯旺森在一次采访中告诉我的那样，当美联储担心经济可能过热时，它就会加息。斯旺森是加州大学欧文分校的金融学教授。由于股市通常在经济全速前进时表现良好，因此在加息周期中，股市平均表现良好也就不足为奇了。</blockquote> For similar reasons, it’s not surprising that the stock market will struggle during a rate-cut cycle. That’s because the FOMC will cut the Fed funds rate when it is worried that the economy is in danger of contracting. For a recent example of that, just think back to the waterfall decline in February and March of 2020 that was precipitated by the COVID-19 pandemic.<blockquote>出于类似的原因，股市在降息周期中陷入困境也就不足为奇了。这是因为当联邦公开市场委员会担心经济有收缩的危险时，它会下调联邦基金利率。最近的一个例子，只要回想一下2020年2月和3月由新冠肺炎疫情引发的瀑布式下跌。</blockquote> Other tools in the Fed tool chest<blockquote>Fed工具箱中的其他工具</blockquote> There are two other big reasons why the stock market doesn’t react to rate hikes in the way conventional wisdom would suggest. The first is that the Federal Reserve in recent years has become increasingly transparent, telegraphing to the markets well in advance about when it may change the Fed funds rate. This means that the stock market will have had plenty of time to react by the time a rate hike actually occurs.<blockquote>股市对加息的反应并不像传统观点那样，还有另外两大原因。首先，美联储近年来变得越来越透明，提前向市场发出何时可能改变联邦基金利率的电报。这意味着当加息实际发生时，股市将有充足的时间做出反应。</blockquote> This certainly has been the case this year, for example. For a number of months now, the Fed has explicitly announced its intention to begin tapering its monetary stimulus. In addition, the Fed circulates a “dot plot” after each rate-setting meeting showing FOMC members’ projections of where the Fed funds rate will be in coming months.<blockquote>例如，今年的情况确实如此。几个月来，美联储已经明确宣布打算开始缩减货币刺激措施。此外，美联储在每次利率制定会议后都会分发一份 “点阵图”，显示联邦公开市场委员会成员对未来几个月联邦基金利率走势的预测。</blockquote> Advisers often say: “Buy the rumor, sell the news.” This appears to apply here, making it difficult to measure the stock market’s reaction to higher rates. What appears to be the poor performance during a rate-cutting cycle might in fact be anticipation of the beginning of a rate-hike cycle.<blockquote>顾问们常说：“买谣言，卖新闻”。这似乎也适用于这里，因此很难衡量股市对加息的反应。降息周期中看似糟糕的表现，实际上可能是对加息周期开始的预期。</blockquote> The other reason the stock market doesn’t always react in predictable ways to rate hike decisions: The Fed in recent years has increasingly relied on large-scale asset purchases in addition to changing the Fed funds rate —otherwise known as quantitative easing (QE).<blockquote>股市并不总是以可预测的方式对加息决定做出反应的另一个原因是： 近年来，美联储除了改变联邦基金利率外，还越来越依赖大规模资产购买--也就是所谓的量化宽松（QE）。</blockquote> Indeed, according to research from UC Irvine’s Swanson, QE appears to have just as much impact on the stock market as cutting the Fed funds rate used to have in the decades before any of us had ever heard of QE. The study, “Measuring the Effects of Federal Reserve Forward Guidance and Asset Purchases on Financial Markets,” appeared in the March 2021 issue of theJournal of Monetary Economics. In fact, Swanson reports that, in a zero-Fed-funds world, QE may have even more impact on the stock market than rate changes.<blockquote>事实上，根据加州大学欧文分校斯旺森分校的研究，量化宽松对股市的影响似乎与我们听说过量化宽松之前的几十年里联邦基金利率的下调一样大。这项名为 “衡量美联储前瞻性指引和资产购买对金融市场的影响 ”的研究发表在 2021 年 3 月号的《金融市场》杂志上。货币经济学杂志事实上，斯旺森报告说，在一个零联邦基金的世界里，量化宽松对股市的影响可能比利率变化还要大。</blockquote> The bottom line? It’s not the case that a Fed funds rate hike is good news. But, at the same time, there is no easy, straightforward or mechanical way in which you can use changes to the Fed funds rate to time the stock market.<blockquote>底线？联邦基金加息并非好消息。但是，与此同时，没有简单、直接或机械的方法可以利用联邦基金利率的变化来确定股市的时机。</blockquote>\n<div class=\"bt-text\">\n\n\n 来源：<a href=\"https://www.marketwatch.com/story/why-a-fed-rate-hike-could-be-just-the-medicine-stocks-need-to-keep-this-bull-market-going-11635955739?mod=home-page\">Market Wacth</a>\n为提升您的阅读体验，我们对本页面进行了排版优化\n\n\n</div>\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{},"source_url":"https://www.marketwatch.com/story/why-a-fed-rate-hike-could-be-just-the-medicine-stocks-need-to-keep-this-bull-market-going-11635955739?mod=home-page","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1182010893","content_text":"How should stock market investors react when the U.S. Federal Reserve begins to raise the Federal Funds rate? That question, in one form or another, is being asked by almost all investors these days. While no one knows for sure when the Fed’s rate hike cycle will begin, it could happen soon —perhaps by the end of the year. With the Fed funds rate near zero and the U.S. economy growing, the question is when, not if.\nConventional wisdom dictates that rate increases are bad news. Higher rates mean that stocks face stiffer competition from bonds. It also means that stocks are worth less, according to standard discounted cash flow analysis: Higher rates mean that the present value of stocks’ future earnings and dividends are lower.\nYet it’s surprisingly difficult to support this conventional wisdom with historical data. In fact, the S&P 500SPX,+0.09%has performed better in the wake of Fed decisions to raise the Fed funds rate than in the wake of rate cuts, on average.\nI reached this conclusion upon analyzing all rate hike increases and decreases announced by the Federal Reserve’s Open Market Committee (FOMC) dating back to 1990. For each rate change decision I calculated the S&P 500’s total return from the date of the increase, either over the subsequent 12 months or until the date of the FOMC’s next rate change decision, whichever came first. The results are summarized in the table below.\n\nIf other things were equal, these results would suggest that investors actually prefer higher rates. But, as is so often the case, things are not equal. For example, as Eric Swanson told me in an interview, the Fed raises rates when it worries that the economy may be overheating. Swanson is a finance professor at the University of California, Irvine. Since the stock market typically does well when the economy is firing on all cylinders, it’s not particularly surprising that the stock market will do well, on average, during a rate-hike cycle.\nFor similar reasons, it’s not surprising that the stock market will struggle during a rate-cut cycle. That’s because the FOMC will cut the Fed funds rate when it is worried that the economy is in danger of contracting. For a recent example of that, just think back to the waterfall decline in February and March of 2020 that was precipitated by the COVID-19 pandemic.\nOther tools in the Fed tool chest\nThere are two other big reasons why the stock market doesn’t react to rate hikes in the way conventional wisdom would suggest. The first is that the Federal Reserve in recent years has become increasingly transparent, telegraphing to the markets well in advance about when it may change the Fed funds rate. This means that the stock market will have had plenty of time to react by the time a rate hike actually occurs.\nThis certainly has been the case this year, for example. For a number of months now, the Fed has explicitly announced its intention to begin tapering its monetary stimulus. In addition, the Fed circulates a “dot plot” after each rate-setting meeting showing FOMC members’ projections of where the Fed funds rate will be in coming months.\nAdvisers often say: “Buy the rumor, sell the news.” This appears to apply here, making it difficult to measure the stock market’s reaction to higher rates. What appears to be the poor performance during a rate-cutting cycle might in fact be anticipation of the beginning of a rate-hike cycle.\nThe other reason the stock market doesn’t always react in predictable ways to rate hike decisions: The Fed in recent years has increasingly relied on large-scale asset purchases in addition to changing the Fed funds rate —otherwise known as quantitative easing (QE).\nIndeed, according to research from UC Irvine’s Swanson, QE appears to have just as much impact on the stock market as cutting the Fed funds rate used to have in the decades before any of us had ever heard of QE. The study, “Measuring the Effects of Federal Reserve Forward Guidance and Asset Purchases on Financial Markets,” appeared in the March 2021 issue of theJournal of Monetary Economics. In fact, Swanson reports that, in a zero-Fed-funds world, QE may have even more impact on the stock market than rate changes.\nThe bottom line? It’s not the case that a Fed funds rate hike is good news. But, at the same time, there is no easy, straightforward or mechanical way in which you can use changes to the Fed funds rate to time the stock market.","news_type":1,"symbols_score_info":{}},"isVote":1,"tweetType":1,"viewCount":2933,"commentLimit":10,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"symbols":[],"verified":2,"subType":0,"readableState":1,"langContent":"CN","currentLanguage":"CN","warmUpFlag":false,"orderFlag":false,"shareable":true,"causeOfNotShareable":"","featuresForAnalytics":[],"commentAndTweetFlag":false,"andRepostAutoSelectedFlag":false,"upFlag":false,"length":10,"subscribersOnly":false,"subscribersOnlyAccessible":false,"xxTargetLangEnum":"ZH_CN"},"commentList":[],"hasMoreComment":false,"orderType":2}