That said, the market is expecting a "hawkish cut," where the Fed telegraphs fewer cuts for next year in its Summary of Economic Projections (which is due to be released tomorrow).
As you can see in this table below, coming out of their September meeting, they saw the Fed funds rate at 3.4% level by the end of next year. They will likely dial that UP by a quarter point tomorrow, which would align with the market view.
Let's take a look at the year-to-date performance of the AI Kings (otherwise known as Mag 7).
These stocks now represent 34% of the S&P 500 index. And with that, they are contributing about 90% of the overall return of the index for the year.
If we look at growth in world money supply since Covid, it's around $20 trillion. The growth in market value of the AI Kings has been $12.5 trillion over the same period. Add another $3 trillion in the growth in the value of cryptocurrencies, and it's fair to say that we know where most of the excess money supply (i.e. above trend growth money supply) has been absorbed from the covid response.