Stocks are dropping hard and bond yields are jumping as the Fed refuses to fight inflation, which is bad news for investors, borrowers, and anyone hoping for cheaper loans.

• The Fed held interest rates steady instead of hiking, choosing to let inflation run rather than risk crashing an economy hooked on cheap money.
• Bonds are selling off anyway — the 30-year yield topped 5.2%, its highest since 2007, as investors demand more to lend to a government that keeps spending.
• Big tech is the problem: Microsoft, Amazon, and Alphabet are pouring half a trillion into AI data centers, but weak earnings (Meta fell 9%) are making investors dump those stocks.
• Higher borrowing costs threaten mortgages, business loans, and consumer spending, while tech stocks have already fallen into correction territory.
• Oil is another risk — Trump is threatening fresh strikes on Iran, US emergency oil reserves are near record lows, and China is buying more crude again.

Outlook: If the Fed is eventually forced to hike, the market reaction could be violent, with more downside for stocks likely near-term.