Markets are betting on Fed to save the day. That could be a mistake

Investors looking for the Federal Reserve to provide the next catalyst for stocks could be disappointed, particularly if upcoming inflation data doesn't cooperate. Economists have grown worried in recent days that the economy is slowing. A weak July payrolls report and massive revisions to prior months reinforced the specter of a slowdown that had started to emerge in other data. The result is that markets are now pricing in the strong possibility of an interest rate cut when the Federal Open Market Committee meets again on Sept. 16-17. Traders also see a near certainty of a second cut by the end of the year, and nearly a 50-50 chance of third reduction, according to the CME Group's FedWatch Tool. "So, we are back to the 'bad is good' mantra, with the Fed expected to save the day by cuttin