The Fed has three options. Here’s the difference between them, and why anything could happen

Key points from this article
I don't think this is true after last Friday's remarks by Bullard (most dovish fed member and voter) and Rosengren, a centrist who isn't fully on board with any cut at all apparently. All this after the evening prior when the NY Fed making a statement walking back their own president's speech just hours after he delivered it. It was chaotic and the Fed was scrambling to get market expectations in line prior to the blackout period which began last Saturday. Here's an excerpt from the article explaining the drama last week
The fact that two Fed members are in favor of keeping rates steady, is a strong case against a 50bp cut.

What's the history telling us?
The Fed doesn't move rates in either direction by 50 basis points during normal easing or tightening cycles. At least this has been the case for the last 20 years under which Greenspan, Bernanke, Yellen, and now Powell have led the Fed.

The only rate changes greater than 25bp were in the form of rate cuts, and they were delivered while the Fed was aggressively easing dealing with the recession in 2001 and the last financial crisis. In 2001, many believe Greenspan was late on cutting rates and subsequently cut rates by 50bp in six consecutive meetings.

Then, in 2007 the Fed started cutting aggressively again and started by cutting rates in Sept 2007 by 75bp when they took the Fed Funds Rate from 5.25% to 4.75%. They continued to cut until Dec 2008 when rates reached 0.25%.

What's EventsTrader's point?
The point is, if history is any indicator, 50 basis point rate cuts don't come as a surprise to the markets at a time where the data doesn't support it. A cut larger than 25bp is a drastic move by the Fed. Other than consistently low inflation, there isn't strong enough statistical evidence to support a measure that's always been reserved for markets in much worse shape than the one we are in.

Another point is that the Fed doesn't surprise the markets. They work hard to be transparent with their policy. Changes in rates have always been delivered with a progressive approach and priced in prior to the FOMC meeting. This approach by the Fed hasn't changed. There's never been this much pressure by the white house to direct the Fed policy, and perhaps that's interfered with the Fed's ability to communicate their upcoming actions.

What's the uncertainty right now?
Over 25% of the market still expecting a 50bp rate cut is very shocking, and that's where the uncertainty lies.

In all likelihood, the Fed is going to cut rates by 25 basis points. However, the market isn't in agreement. The Fed doesn't like that but can't do anything about it because we are in the blackout period and won't here from any Fed official until the FOMC meeting. This puts a lot of risk related to volatility on both the rate announcement, the rate statement, and the press conference afterwards.

There's a lot of time between now and the 31st, but with only GDP and PCE inflation data due out before then (as far as data that can shift expectations), this could be one the most highly anticipated FOMC meetings since the days Greenspan and the briefcase indicator.

Here's where the market stands in terms of rate cut expectations via the CME FedWatch Tool.

One last thing...
Use caution and do your own research. I always appreciate feedback and debate. I want to hear the counter argument. Here's a picture of a trader after taking losses because he listened to others, rather than doing his own research:

Personally I'm dumping every stock I own into cash except gold and silver stocks because there is something seriously wrong when stockmarkets are smashing all time record highs daily and the Fed are considering ZIRP with some officials considering QE. You use these tools when the economy is in trouble there isn't any other time you should use them so to use them now means you do not have any tools left if it doesn't work basically you get a crash.

Business and financial writers are attempting to make a cut fait accompli. The hubbub of a 50 point cut ha been to assure a 25 point cut. I see no basis to make any cut. Better to keep the breathing room for a time when there is some rational to do one.