The short end is the story
Everyone is arguing about the next rate cut. The only thing that matters is what happens to the front of the curve.
There is a version of rate commentary that treats the policy rate as a single number moving up or down, like a thermostat. For equity owners, the interesting part is not the level. It is the slope of the front end, because that is what prices the alternative to owning a stock.
When three-month bills pay a real return with no equity risk, every long-duration asset has to clear a higher bar. Small caps feel it first, then unprofitable growth, then the parts of the market that were only ever valued on a story. That is not a prediction of a crash. It is a description of which discount rate is doing the work.
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