Is the Fed Really Done Protecting the Stock Market?

Is the Fed Really Done Protecting the Stock Market?

Today, Jerome Powell was asked if there's a "Fed put" for the stock market—the idea that the Federal Reserve will step in to stabilize things when the market goes haywire, like it did in 1987, 2008, and 2020.

Back in those days, the Fed stepped up, cutting rates to save the market from crashing, especially during the Green Span and Zerp eras.

But when Powell was asked today, he went ahead and dropped a hard no. He said, “No,” and then rambled on with some typical Fed jargon, which... no one asked for, Jerome.

The market didn’t appreciate that answer. After Powell's dismissal of the idea, stocks started to sell off, with the NASDAQ ending the day down 3%.

So, if you're hoping for another Fed bailout, don’t hold your breath. The Fed’s done being the market’s safety net—at least for now.