Once the Federal Reserve starts cutting interest rates, the probability of a mad bull market breaking out will increase significantly, indicating that 2025 may become the year of the mad bull. However, some voices pointed out that the real climax of the bull market may come before the first interest rate cut, because the realization of the interest rate cut news may actually trigger a market correction. The historical trend of the US stock market is a lesson learned from the past.

However, not all experts are optimistic about an immediate bull market next year. Some well-known bloggers have different opinions. They believe that 2025 is more likely to be the end of the bull market, and even assert that the bull market has quietly ended. Of course, there are also views that in the next few years, we may still be in the aftermath of this bull market, and may even usher in a long-term bull market. However, all of this is closely linked to expectations of interest rate cuts, and market fluctuations are inevitable under expectations.

Looking back at history, taking 2019 as an example, the Federal Reserve began to cut interest rates in July of that year, gradually lowering interest rates from 2.25% to 0~0.5%. The entire interest rate cutting cycle lasted for 8 months and did not end until March 2020. Interestingly, although expectations for an interest rate cut had emerged as early as July, the real bull market in the currency circle did not fully erupt until after the interest rate cut cycle ended, that is, in April of the following year.

Based on this historical experience, we can reasonably speculate that even if the Federal Reserve begins its interest rate cutting journey in 2025, if the interest rate cutting process begins in September this year and continues for more than a year, the next bull market may be even more intense. As a major benefit, interest rate cuts often take time to fully unleash their effects.

As for the specific duration and magnitude of this round of interest rate cuts, it is still difficult to determine. Considering that the current interest rate has climbed to around 5.5%, the path of interest rate cuts in the future may be relatively long. It is not impossible to gradually drop from 5.5% to around 2%, or even further to 1.5%, 1% or even 0.25%. The future is full of variables, but the market opportunities brought about by interest rate cuts deserve our close attention. For more in-depth analysis and market dynamics, please click on my avatar for details!

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