The Great September Pivot: A Letter to My Future Self

September 13, 2025

Dear December Me,

I'm writing this as the Dow sits at 46,108, the S&P at 6,587, and the Nasdaq at 22,043. All-time highs. Again. I'm writing this as we sit nine days away from what might be the most consequential Fed meeting since March 2020. I'm writing this because I want you to remember exactly how intoxicating — and terrifying — this moment feels.

Markets are pricing in an 86.9% chance of a rate cut on September 17th. The terminal rate has been sitting at 4.5% for nine months now. Nine months of economic purgatory where nobody knew if we were headed for a soft landing or a controlled demolition. Powell held steady through July. The jobs report broke everything.

Remember how quickly sentiment shifted? Before July's employment disaster, the market gave Powell's non-pivot only 37% odds. After those numbers hit — unemployment ticking up, job creation missing estimates — suddenly everyone became a dove. Overnight, rate cut probability shot past 80%. The market moved faster than a panicked central banker's printer.

Here's what I'm watching: $7 trillion sitting in money market funds. Seven. Trillion. Dollars. That's not just cash on the sidelines — it's a financial tsunami waiting for the dam to break. When Powell finally blinks, where does that mountain of 5% yielding money go? The equity rally we've seen is just the appetizer.

Gemini Space Station (GEMI) jumped 40% yesterday in its Nasdaq debut, pricing at $28 and opening at $37. A crypto exchange going public while Bitcoin hovers around acceptance feels like either perfect timing or peak euphoria. Probably both.

The Dow gained 617 points on Thursday alone. That's not a rally — it's a celebration. Markets partying before the host arrives. But here's the thing that keeps me awake: this optimism assumes Powell gets it right.

We're not just pricing in a rate cut. We're pricing in the Goldilocks scenario where he cuts enough to satisfy the doves without spooking the hawks, where inflation stays tame while unemployment doesn't spiral, where the everything bubble gets another year of life support without anyone asking uncomfortable questions about valuations.

The Russell 2000 has logged six straight weeks of gains. Small caps leading means something. Either it means the market believes in American growth stories again, or it means money is so desperate for yield that it's chasing anything that moves.

I keep thinking about that $7 trillion. When 5% money market yields become 3% yields, then 2%, then who knows what — where does that capital flow? Into NVDA at 100x earnings? Into Tesla because Elon promised robots? Into REITs because dividend yields look attractive again?

The structural question haunting this moment: are we witnessing the Fed's masterful orchestration of a soft landing, or are we watching the final act of the most expensive monetary experiment in human history?

By December, you'll know whether September 17th marked the beginning of a new cycle or the moment we admitted the old cycle was unsustainable. You'll know whether that $7 trillion became rocket fuel for the next leg up or gasoline for the next crisis.

Either way, remember this feeling. The weird confidence mixed with existential dread. The sense that everyone knows the music has to stop eventually, but nobody wants to be the first to leave the dance floor.

49 stocks in the S&P hit 52-week highs on Wednesday. The VIX is practically comatose. Credit spreads are tighter than a Fed governor's smile.

This is what the top feels like, or this is what the beginning of the next great bull market looks like. The beautiful thing about markets is that both can be true simultaneously, right up until they can't.

Stay paranoid,
Your September Self

P.S. — If Powell doesn't cut on the 17th, ignore this entire letter. We'll be living in a different universe by then.