More than one friend asked me, "Isn't the interest rate cut a good thing? Why would it fall?"

In fact, it is not the interest rate cut that will cause the price to fall, but the initial interest rate cut that will cause the price to fall.

From the perspective of the secondary market, there is a popular saying in the currency circle that all good things are bad things. Because before the good things, the dealer wants to clean up the market.

From a macro perspective, the beginning of the interest rate cut is the end of the interest rate hike. When an economy has experienced a period of interest rate hikes and high interest rates, it is actually the time when liquidity is the most tense. Just like a person who has been fat for a period of time and is about to lose weight, losing weight is of course healthy, but when he or she just loses weight, he or she is the fattest, the most unhealthy, and the most dangerous. You can refer to the top post of Brother Feng on Twitter. There have been many crises at the beginning of the interest rate cut in history.

From the perspective of the real economy, the interest rate cut is to stimulate the economy. Therefore, the beginning of the interest rate cut may be the worst time for the real economy. After the Big Pie ETF is passed, it has a higher correlation with the US stock market than before. The US stock market is related to the real economy, and the initial interest rate cut is often a downward trend for the US stock market.

In addition, Brother Feng has another logic. Because the interest rate is going to be cut, whether it is the real or speculative market, repaying the high-leverage loans first and then lending them out after the interest rate cut can reduce the interest cost.

The most important thing is that because of the history of crises at the beginning of interest rate cuts after a period of high interest rates, and the history of US stocks falling at the beginning of interest rate cuts, the market has formed some consensus. Therefore, it is expected that there may be a certain amount of selling before the interest rate cut, so the interest rate cut may really fall at the beginning, and it may even start to fall in advance before the interest rate cut.