The U.S. Federal Reserve’s looming decision on whether to cut interest rates in September 2025 is sparking heightened concern on Wall Street, as strategists at Bank of America (BofA) Securities draw unsettling parallels to the months preceding the 2007–08 financial crisis. A recent Liquid Insight report, published Aug. 14 by strategist Howard Du and his team, warns that the current monetary and inflation landscape is flashing signals reminiscent of the last time the Fed cut rates in a rising inflation environment. “This is a possible but historically rare regime,” they added. The last time it happened was from the second half of 2007 to the first half of 2008, they said in their note titled “Ghosts of 2007.”
At the same time, a separate BofA Global Research note, from the equity and quantitative strategy team, looked at another historical rhyme: between the megacap stocks dubbed the “Nifty 50”—notably Nvidia and other members of the “Magnificent Seven”—and the last time they outperformed the S&P 500 for so many years. (The first Nifty 50 to bear the nickname was a group that ran until roughly 1973, when the game changed for markets because of the onset of the Great Inflation and other factors, including a shift away from the gold standard.)
