The key issue isn’t simply whe

The key issue isn’t simply whether the Fed hikes 25bp—it’s what happens to yields afterward.

With the 10-year Treasury briefly above 5% and Brent above $100, markets are facing pressure from both tighter financial conditions and renewed inflation risks.

For me, the Treasury market is the crucial signal. If long-term yields stay elevated, high-duration assets—including expensive AI names—may face continued valuation pressure even if earnings remain strong.

The AI story isn’t necessarily broken; the market may simply be demanding more proof of future cash flows. That makes Fed guidance, long-term yields and AI capex expectations the three things I’ll watch most closely after the decision.

@WallStreet_Tiger [正经]

Fed Rate Decision Due: Can Markets Absorb a 25 bps Hike?

Indexes closed lower again Tuesday: QQQ −0.65% to $704.54, SPY −0.46% to $757.39, S&P 500 −0.45% to 7,585.73. Everything waits on 2 a.m. Beijing Wednesday, when the Fed is expected to hike 25bp to 3.75%–4.00% with oil and yields climbing. Morgan Stanley, JPMorgan and Goldman all argue the turn is priced and that earnings and growth still carry equities, so one hike does not redirect the move. The tape agrees for now — indexes down under 1%, VIX at 17.20, no panic. But "already priced in" is a calculation, and it gets redone the moment the path is redrawn. Have the big banks called this right?

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