The Federal Reserve is highly likely to cut interest rates by 25 basis points at 2:00 PM ET today. While this move feels overdue, my concern lies with Fed Chair Powell’s press conference and the release of the Summary of Economic Projections (SEP).

With tariffs back on the policy agenda under the new administration and the labor market continuing to perform better than anticipated, inflation is starting to resurface as a pressing issue.

Back in September, Powell projected a total of 100 basis points in rate cuts for 2025. However, that forecast might now be trimmed to 75 or even 50 basis points.

Sustained high interest rates won’t necessarily help cool the economy. Instead, they could risk pushing it over the edge. Consider the implications for entrepreneurs: starting or expanding a business may become unfeasible under such conditions. Meanwhile, large corporations with greater resources could thrive, amplifying inequality.

It’s reminiscent of It’s a Wonderful Life, where Old Man Potter capitalized on the Great Depression by buying out struggling banks. His ability to play the long game gave him a significant advantage, a scenario eerily similar to what we might face today.

Bottom line, don’t wait to buy if you plan to time the market/rates. Housing is one of the best hedges again inflation and the projections for 2025 are from 3-9% rise.