The market took a hit this week, and most of the post-election gains were wiped out. This came after the Fed announced that they plan to cut rates twice in 2025 instead of the forecasted four, and also that they don’t expect inflation to reach its target rate until 2027.
To me, it’s all part of the cycles. It must not be forgotten that one of the mandates of our central bank, The Federal Reserve, is to keep inflation at 2%. I would say that over time, they have done a pretty good job, even with curveball like Covid when all bets were off.
Right now, inflation is running about 2.5%, which to me looks very close to 2%, although to most economists, it is probably a distant mark. We have a strong central bank which operates best it can without political influence, and I cannot imagine a country like ours without the values the Federal Reserve brings to all of us. I took the hit this week just like most Americans who are in the market, and I’m staying in the market because it will continue to be a safe place to invest for the long-term.
