Expert sees two 'drastically different' outcomes after Fed rate cut

STORY: :: Lisa Bernhard, Reuters

:: George Cipolloni, Portfolio Manager, Penn Mutual Asset Management

Market reaction after a Fed rate cut is "recession-dependent," Cipolloni explained.

"If the economy is not in a recession, the market tends to go up roughly 10 to 15%," he said. "And if we are in a recession, the market tends to go down about 10 to 15%."

Speaking with Reuters' Lisa Bernhard, Cipolloni added that the bond market right now is "telling us a really important story."

"If you look at the two-year yield relative to the Fed funds rate right now," he said, "it's at its widest gap in 35 years," signaling the economy "may already be in that recession."