#牛回速归

Fed Chairman Powell's dovish speech at the Jackson Hole Symposium last Friday has reset the clock for the Bull Market in US stocks and opened the door for further gains.

Wall Street veteran Jim · Paulsen said in an interview on Friday that a "new Bull Market" for U.S. stocks had emerged after the Fed confirmed its intention to cut interest rates.

Paulson said, "The Fed has unleashed a lot of positive forces for US stocks that did not exist before," he worked on Wall Street for 40 years before retiring.

He added, "This is the only bull run in the entire Bull Market period after World War II that the Fed has maintained a tightening policy. Typically, the Fed begins to ease policy before the start of a bull run. Therefore, to some extent, I think the Fed's action actually takes us back to the beginning of the bull run."

The positive forces unleashed by the Federal Reserve include the decline in interest rates and US bond yields, as well as the acceleration of money supply rise. These are the missing factors in the current Bull Market that started in October 2022.

These forces, combined with positive actual GDP rise and sustained anti-inflationary trends, should boost the mood of businesses and consumers.

Paulson said, "Taking all these factors into account, we have not experienced such a situation before, and we will see a rise in private sector confidence. Consumer and business confidence, I think, will also begin to improve, which feels like a brand new Bull Market," he pointed out that these conditions usually herald a comprehensive pump in the US stock market.

The US stock market's pump before 2025 is consistent with Paulson's optimistic view of the economy, as he does not believe there will be a recession in the near future.

Paulson pointed to consumers and businesses with strong balance sheets and $60 trillion money market funds as his reasons for optimism.

"I think it's hard to find the vulnerability that causes a recession," Paulson said. "And when pessimism remains high, which means confidence is low, it tells me that people have been cautious all along."

Looking ahead, Paulson said it doesn't matter whether the Fed cuts rates by 25 or 50 basis points at the September FOMC meeting, what matters is that officials will cut rates.

Paulson concluded, 'It's not just a matter of the Fed cutting rates by 25 or 50 basis points, but the intention to lower rates is opening up a whole new level of support for US stocks. I believe this support will continue into next year and beyond.'