Goldman Sachs CEO Rejects 50 Basis Point Cut, Sends Market Into Frenzy

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Ah, the world of finance. Where everyone has an opinion, and none of them seem to agree. Enter Goldman Sachs CEO David Solomon, who recently shattered the dreams of many rate-cut enthusiasts by squashing the idea of the US Federal Reserve slashing interest rates by 50 basis points in September. This, of course, came just days after Standard Chartered Bank decided to roll the dice and predict the very thing Solomon called “unlikely.” Oops.

“Whether or not we have a 50 basis cut, I don’t think that’s probably on the cards,” Solomon declared during an interview with CNBC on Wednesday. A bold move from someone who clearly doesn’t care to entertain reckless optimism.

But hold onto your hats! While the mighty CME FedWatch Tool shows that a meager 7.8% of market participants are actually betting on a 50 basis point cut at the September 17 Fed meeting, Standard Chartered just couldn’t resist raising its forecast to that level. Their reasoning? August’s surprisingly weak jobs report. Because when in doubt, blame the job market, right?

And while we’re at it, let’s take a moment to appreciate Mister Crypto, the self-proclaimed oracle of the crypto world. He boldly predicted that if the rate cut miracle does indeed happen, “crypto will explode through previous ATHs.” We’re all waiting with bated breath for this digital fireworks show. 🔥🚀

Meanwhile, Solomon, ever the realist, isn’t buying into the hype. He’s betting on a smaller cut, citing the broad market consensus. “I’m pretty confident we’ll have a 25 basis rate cut,” he said. Which, let’s face it, is probably the least exciting prediction in the history of finance, but hey, stability is overrated.

Solomon Sees “Softening” Labor Market

“There’s no question that when you look at the labor market, there’s a little bit of a softening,” Solomon added. Wow. Another shocking revelation. The labor market isn’t bulletproof. Who would’ve thought?

But Solomon isn’t just twiddling his thumbs; he’s also eyeing potential for two more rate cuts this year. Yes, two! “I think you could see one or two other cuts, depending on how economic conditions play out from here,” he mused. So, brace yourselves for more financial drama in the coming months. 😱

This Fed meeting is important for more than just stockbrokers and bond traders. It’s also a big deal for crypto, since lower interest rates make traditional investments like bonds look as exciting as watching paint dry, while riskier assets (crypto, anyone?) suddenly seem like the cool kids on the block.

But wait, there’s more! Sentiment platform Santiment recently cautioned that the flood of social media chatter about the rate cut might be a red flag. “Historically, such a massive spike in discussion around a single bullish narrative can indicate that euphoria is getting too high and may signal a local top,” they said. So, if you’ve been daydreaming about your crypto portfolio turning into a mansion, maybe dial it back just a touch. 🤔

Crypto Market Might Have Already Priced in the Fed Cut

It’s not just Standard Chartered playing the guessing game. Bank of America, in a shocking twist, has reversed its long-standing stance of “no cuts in 2025” and is now predicting two 25 basis point cuts-one in September and another in December. We can only imagine how much caffeine was involved in that decision.

And let’s not forget the ever-dramatic Fed Chair Jerome Powell, who teased the possibility of a rate cut during his keynote at the Jackson Hole Economic Symposium in Wyoming on August 22. Ah, the intrigue. The suspense. The… looming uncertainty.

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2025-09-11 09:28