What Are the Markets Telling Us Right Now?

The market’s reaction to the Fed’s giant rate cut has been strange.  Since the Fed’s move on September 18, the yield on the 30-year bond has traded sharply higher while equity markets have been grinding higher.  Gold has screamed higher and oil prices have traded aggressively lower.  Bottom line, with the exception of price action in oil, the markets are sending out some signals that suggest investors are expecting the Fed’s first rate cut since March of 2020 to ultimately be quite inflationary.  Let’s examine the markets a bit more closely.