To help everyone better understand the Fed's interest rate cut cycle, we can compare the economy to the human body, and the interest rate cut cycle is similar to a patient's treatment process. Just as a sick person needs plenty of rest, during the interest rate cut cycle, investors should also act cautiously and avoid reckless investments.

'Preventive rate cuts' can be compared to preventive treatment for patients showing early symptoms. When the economy shows signs of recession, the Fed will implement small rate cuts to prevent further deterioration. Although the economy may appear resilient at this time and the stock market may rebound, the investment returns during this phase are usually not high.

'Violent interest rate cuts' are akin to a patient whose condition has deteriorated sharply and requires emergency treatment. During an economic or financial crisis, the Fed will implement significant interest rate cuts. At this stage, the economic outlook is uncertain, making it even less suitable for investment.

The best time to invest is only when the Fed stops cutting interest rates and declares that the economy has passed its most difficult period. It is similar to a doctor announcing that a patient has moved out of danger and transferred from intensive care to a regular ward.

Looking back at the interest rate cut cycle from July 31, 2019, to March 15, 2020, we can see that over 228 days, the Fed cut rates a total of 225 basis points, lowering the rate from 2.25%-2.50% to 0-0.25%. This rate cut process was divided into two phases: from July to October 2019, the Fed cut rates three times for a total of 75 basis points, mainly to address trade tensions and economic growth slowdown; at the beginning of 2020, it was in response to more severe economic challenges.

Understanding the characteristics and background of this interest rate cut cycle helps investors make more informed decisions in different economic environments. However, it is important to note that each economic cycle has its uniqueness, and investors should also formulate their investment strategies in conjunction with the current market conditions and their personal risk tolerance.