Debunking the post debunking that markets are going to tank because the Fed started cutting rates myth

Post I am debunking: https://www.reddit.com/r/wallstreetbets/comments/1fmmrtr/debunking_the_markets_are_going_to_tank_because/

u/fuglysc posted misleading data by Ned Davis Research that didn't even adjust for real returns and preached it as if it's some "objective truth". You can't use nominal returns through 1970-1990, because contraction occurred during stagflation as nominal prices increased. It is a straight up embarrassing rookie mistake…

The dataset also included rate cuts that began at the bottom of an already active recession. Naturally the markets goes up once the economy recovers from a recession and valuations are cheap. It's not applicable to the current market as we're currently cutting rates following a market boom, not bust.

When you control for these variables, the data actually suggests that there's usually a bear market after rate cuts following a boom. Although some of those declines are short lived, it's still important to know that they exist, so you don't get caught off guard.

Nov 1966: +14% 12-month performance.

Sep 1969: -28% drawdown in monthly price. -25% 8 months after rate cut. -14% 12-month performance.

Jan 1981: -29% drawdown. -26% 18 months after rate cut. -14% 12-month performance

Aug 1984: +10% 12 month performance.

Apr 1989: -19% drawdown. -10% 18 months after rate cut. +2% 12-month performance.

Jun 1995: +19% 12M performance.

Nov 2000: -42% drawdown. -40% 22 months after rate cut. -15% 12-month performance

Jul 2007: -53% drawdown. -50% 19 months after rate cut. -18% 12-month performance

Jul 2019: -20% drawdown. -14% 9 months after rate cut. +9% 12 month performance.

https://www.macrotrends.net/2324/sp-500-historical-chart-data

Condensed summary for short attention spans:
Data since 1950 suggest that a bear market will occur ~70% of the time after the Fed starts cutting rates following an market boom.