#美联储降息 Seeing this report from JPMorgan, scenes from the liquidity crisis in 2019 flashed through my mind. Interest rate cuts are fully priced in, and the US stock market is facing profit-taking—this phrase sounds fresh, but it’s actually an old story repeating.

Do you remember the panic at the end of 2018, followed by the buyback wave in September 2019? It was the same back then, the market surged crazily under the expectation that "interest rate cuts are coming," but when it actually happened, it turned out to be a selling point. History is so interesting this way; investors are always repeating the same psychological game—expectation vs. reality.

The current situation has become more complicated. On one hand, there is the support expectation from the dovish Federal Reserve, while on the other hand, consumer debt has surpassed $1.2 trillion and credit card rates exceed 20%. The data pointed out by Bitfinex is quite concerning—layoff rates are nearing a three-year high, and the voluntary resignation rate has fallen to a new low since 2020. This is not a signal of a strong economy; it is a sign that people are starting to tighten their belts.

How many times have we seen such a situation: loose policies come, risk assets rebound in the short term, but the fundamentals have not really improved. It was like this after the massive monetary easing in March 2020, and the liquidity in 2021 was also like this. If real large-scale easing has to wait until May next year, then the next period will be a test—can interest rate cuts really stimulate growth, or are they just providing a support needle for asset prices?

I don't find anything surprising about JPMorgan's mention of year-end profit-taking. The key is to see who still has the motivation to continue chasing highs after this wave of Liquidity normalization.