Why have stocks risen even though interest rate hikes were announced?

by cranialrectumongus

Here’s my proverbial two cents on this matter. I’m old and have seen a lot. Doesn’t in anyway make me an expert but it also is not without some value.

1. The market already knows about inflation and recession. Markets reacts more negatively to black swan events like 9/11, 2008 financial meltdown/housing crisis/credit crunch, tech bubble, etc. Once it is known and counter measures are taken the market tries to discount the ill effects and look past the current situation, often rising amid bad news reports.
2. The Fed is already signaling that it is going to aggressively raise interest rates. While this seems somewhat counter intuitive because higher interest rates will slow the economy and may send the economy into recession, this also means that the Fed is not going to ignore or prolong the inflationary period by half-ass interest rate increases.
3. Basically, the market is saying “just rip the band-aid off” and then let’s get back to making money, lest we become Venezuela.