NEW YORK (CNN/Money) - So the Fed didn't do anything with interest rates (real shocker there) and, to judge by what went on in the market, investors have finally taken to heart the idea that it isn't going to raise rates for a long, long time.

It will be interesting to see how long this point of view prevails.

Justin Lahart, senior writer at CNN/Money, talks about how long it will be until the Fed starts raising rates again. Play video (Real or Windows Media)

Most Wall Street economists don't expect the Fed to hike its funds target rate above today's 1 percent in the first half of next year, and they're split about evenly over whether the Fed will move at all in 2004. Until Tuesday, however, investors took a far less sanguine view of when the Fed would move on rates.

According to the fed funds futures contracts, which price off of Fed rate move expectations, as of Monday investors were split evenly over whether the central bank would raise rates by a quarter point by its January meeting. By March a rate hike looked like a done deal and by July they expected the Fed to have raised rates by three quarters of a point.

But by the close Tuesday the futures suggested the Fed won't begin to hike until May, and that by July the funds rate will only be a quarter or half point higher than it is now.

It's a forecast that, by most investors' lights, is one step closer to Nirvana. The low funds rate will keep the juice flowing into the economy leaving borrowing rates low. Treasury yields shouldn't move significantly higher, so they shouldn't offer too much competition for stocks as an investment.

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But this view appears rife with inconsistencies. To judge from stocks' historically high valuations, investors expect earnings to continue to accelerate through next year. This is not a view shared by all those economists who think the Fed is going to stay on hold. Rather, they believe economic growth will moderate next year from its current pace, and this moderation will bring with it slower earnings growth. It's not a bad environment, but neither is it the sort of future the bulls have in mind.

If the economy does do what the stock market seems to be saying it will? It's hard to imagine the Fed won't be hiking.