Fed rate cuts are often a warning sign for the economy. That might not be the case this time around.

• The Federal Reserve cutting interest rates has long been viewed as a harbinger of imminent economic doom.
• Cuts in 2000, 2007, and 2019 were soon followed by recessions.
• But here's why an easing cycle in 2024 might not be the economic warning it once was.

The Federal Reserve sparked a huge rally this week after acknowledging that rate cuts are more likely than rate hikes in 2024 as inflation continues to moderate.

Conventional thinking on Wall Street has been that cuts are a warning that the economy is on the brink of a recession. If the Fed sees a slowdown in the economy, it will lower rates to stimulate demand and consumer spending.