Banerji: We're seeing people grow more optimistic... turbocharged after that jumbo rate cut by Fed

She's got a new piece in the journal titled People Are Growing More and More Bullish. How can they be more and more bullish? They've already been bullish for the better part of two to three years now. Good morning, Dom. That's right. We are seeing people grow more optimistic about this rally. I think we've seen a lot of people take a sunnier outlook on stocks for a lot of this year. But that optimism was kind of turbocharged after that jumbo break cut that we saw by the Fed. We're seeing the VIX fall to its lowest level of the month. We're seeing other measures across markets from high yield bonds to derivatives show that people are really positioning for this rally to continue. All right. So if that is the case, that brings into mind all of these elements about complacency and this idea that people don't care. And when they don't, that's when the bad things start to happen. How do you reconcile that kind of market dynamic? I would say looking across the market, people are not concerned about a drawdown right now. We saw the ratio of put options to call options trade yesterday hit one of the lowest levels of the year. Again, the VIX is down. Yields on high yield bonds, which are the most sensitive to how the economy is doing, are at some of the lowest levels since 2022. So we are seeing people pile into that soft landing trade. And of course, you could argue now everyone is on this side of the But look, the data has held up so far. And I think that's why people are going to be keeping an especially close eye on things like inflation spending this Friday and jobs next Friday. So let's take us through the word of the day in your mind. What is it? You kind of alluded to it already. I get a sense for what you're going to say. The word of my word of the day is calm. I think, you know, there's been a remarkable calm out there and people are positioning for this really placid stretch of trading to continue. Take a look at what's happening ahead of the opening bell. We're down like zero point one, zero point two percent. And people just aren't positioned for turbulence ahead. There is just not a lot of fear out there in the market right now. How do you I mean, I look at this and I say we have JP Morgan CEO Jamie Dimon talking about this notion of rising risks in the geopolitical sphere. We've also got a presidential election coming up that could in many ways be a catalyst for volatility. We've got a fourth quarter shopping season coming up that could be a referendum on the strength of the U.S. consumer. Yet, as you point out, the VIX languishes. What exactly is happening and why are there no concerns about for all these potential catalysts coming up? I think a lot of it does come back to the Fed. Right. And I think a lot of people were encouraged by this 50 basis point rate cut, which was much more than a lot of people expected. And when you take a look at the data going back to the 1980s, stocks and bonds typically do do well after the first Fed rate cut. And I think there are some warning sounds like warning signs out there, including in the consumer confidence data yesterday. But it hasn't been enough to move the needle in the other direction. And again, I think a lot of people got the recession trade wrong the past two years and they're almost afraid to say it now. OK, if that is going to be the scenario that we are dealing with, there has to be a sense then that if there is a leadership regime that happens, it could be a broadening out of this market rally that we've been talking about. Is it going to be a broadening out trade? Do you see that kind of in the fund flows data? Do you see it in the options market? Do people believe that the market can do better without just leadership from the magnificent seven? I think that's already been on display, right? Take I mean, after NVIDIA's last earnings report, we did see other corners of the market pick up some slack and just take a look at trading this week. It's been the energy sector, the material sector leading the way, Caterpillar hitting a record high, McDonald's hitting a record high. That is a broadening trade. That is, you know, the corners of the market that are most sensitive to the economy doing really, really well right now.