The all-important Fed rate decision is on deck. It will determine how the year will close out. Unlike previous Fed interest rate decisions, there is still uncertainty in the bets of what will happen on the morning of the decision, standing at 86%. Expectations are also that Powell’s rhetoric will be hawkish, giving little confidence that further cuts should be expected in the near term. Longer US interest rates are not falling, and global rates are on the rise, especially Japan. This is problematic because while the US Treasury is positioned strongly for lower short rates, it is the lower rates on real estate and auto finance that will stimulate the economy.The record amount of global debt creates a competition to refinance an ever-increasing amount of debt, which has been growing faster than economies, squeezing budgets with higher debt service. Restarting quantitative easing, where central banks make open market purchases of longer bonds, is the proven way to bring longer rates down, but that has been characterized as a tool for challenged economies, not ones still growing with stock markets near all-time highs.All that said, it remains likely that the Fed will cut today, and that when Powell is replaced next May with a Trump nominee, further cuts will be forthcoming. The history of the Fed cutting when the stock market is within 2% of all-time highs, 100% of the time stocks were higher 12 months later. On top of solid growth forecasts for the US GDP and earnings, a cut today is plainly bullish for stocks. On the commodity front, precious metals are largely flat, while crude oil has dropped below $58/bbl and natural gas has stopped falling. Gasoline continues to fall, down 10% in a month and now at a 5-year low - very helpful for inflation, especially consumer perception of inflation. Crypto has given back half of its rebound from yesterday. Expect upside after the cut and into the year-end. If the Fed surprises and does not cut, expect to see meaningful downside volatility. The trend remains positive, and the outlook for 2026 is getting better.