Over about 15 months, the Fed slashed rates from 5.25% (Sep 2007) all the way down to 0–0.25% (Dec 2008), where they stayed for seven years.
Just 21 days after the first rate cut (9-18-2007) the market topped (October 9, 2007). From peak to bottom the market crashed -57%.
After the first Fed cut of the crisis (Sep 18, 2007):
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The S&P 500 closed at about 1,519 the day before the cut.
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It kept rallying and reached its all-time pre-crisis peak on Oct 9, 2007, at 1,565.15.
That’s just 21 days after the first cut. After that, the market began rolling over, with the financial crisis deepening through 2008. The stock market peaked 3 weeks after the first rate cut on September 18th 2007.
Here’s the breakdown of how the S&P 500 moved after its Oct 9, 2007 peak (1,565.15): Jan 9, 2008 → S&P 500 around 1,420 That’s about -9% from the peak. Apr 9, 2008 → S&P 500 around 1,354 About -13.5% from the peak. Oct 9, 2008 → S&P 500 around 909 About -42% from the peak. Mar 9, 2009 → S&P 500 closed at 676.53 That was -57% from the Oct 2007 peak.📉 3 Months Later
📉 6 Months Later
📉 1 Year Later
📉 Final Bottom