reply on: U.S. Job Market Stumbles as Government Becomes Sole Job Creator \ stacker news ~econ

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59 sats \ 7 replies \ @riberet19 3 Jul \ parent \ on: U.S. Job Market Stumbles as Government Becomes Sole Job Creator econ

I've heard many economists say that when rates fall the market will crash, how true can this be? because they supposedly discount that something bad is happening in the economy and that is why they lower interest rates.

33 sats \ 2 replies \ @TomK OP 3 Jul

A sharp fall of rates normally anticipates a deep recession. This will make investors reduce their holdings while insolvencies rise etc etc. The market crash is the bursting bubble that follows when the herd leaves the room, needs cash

59 sats \ 1 reply \ @riberet19 3 Jul

This is what usually happens, that is, there has never been a fall in interest rates without a recession, or I am wrong

49 sats \ 0 replies \ @TomK OP 3 Jul

I do not remember any other important case.

16 sats \ 3 replies \ @Bell_curve 3 Jul

I don’t understand that reasoning either

59 sats \ 2 replies \ @riberet19 3 Jul

But this is what has usually happened during past interest rate cuts.

33 sats \ 1 reply \ @TomK OP 3 Jul

The cut is the sign of weakness and normally follows after they broke a market or a segment like banks

16 sats \ 0 replies \ @Bell_curve 3 Jul

Bigger concern should be inflation