Trump stock market rally continues; Dow hits new high

More bad news, er, adjustment...

 

When the middle class to upper middle class people who voted for Trump see their 401k performance they are going to be angry.

 

more catalysts in the next few days to drive down the stock market more.

Fed to announce interest rate hike and the impending Gov shut-down​

 

there were indications that Congress will use CRs to kick the can down the road to Feb,, avoiding a Gov shutdown

so the market rose at the open, to > 300 point

Trump's hand-picked Fed Chair, J Powell, raised the interest rate, despite Trump's many tweets to the contrary

the market is down close to 500 points, an 800-point swing.



we all recall that Trump opted not to keep the previous Fed Chair, Janet Yellen, who had been more dovish, a lot more so than Powell

 

Every time this thread is bumped up, the DOW drops by hundreds of points....

Someone should close this thread.

 

Trump better hopes the market rebounds or else he might be facing the most lopsided loss in election history. Then again he might be in jail by the time 2020 rolls around.

 

I appreciate Powell ignoring Trump and doing his thing anyway. But I don't appreciate Trump's effort to interfere. Trump would like to pull every lever to get short-term economic benefits (see also unfunded tax reform) with no concern for the long-term costs. As long as the next economic collapse can be forestalled until Nov 2020, he's happy to do whatever. Independent Fed is a good idea. I wonder how long it'll last with this guy though.

 

Do we have economists here or somebody that understands what the FED is doing? I mean, they KNOW that these rate hikes and less than dovish statements will take down asset prices. This is so predictable that the end result is a recession.

My question: what is it the FED fears so much long term that every 8-10 years they embark on this destruction of asset prices, especially the stock market? What would be the problem in leaving things as they are?

 

run-away inflation

lower unemployment, avg hrly wage increasing,
increasing price of imports, etc.​

 

Economist here.

Interest rates in their natural state need to be high, ~5%, for various reasons.

Every economist in the country is shaking in their boots over this r****ded tax cut, which gives the government zero tools to counter the inevitable recession.

Right now, with the current economy, taxes need to be high and so do interest rates.

 

The guy who thinks raising the Fed Rate is a bad idea also thinks that trade wars are easy to win and that US consumers do not pay for the tariffs.

 

It's amazing with the loose monetary policy and low tax rates that we aren't seeing inflationary pressure after a 10 year boom.

 

Petroleum Dollar is why.

 

What surprises me more is that the 10 year boom was not boomier. We just gave the world's largest capitalist economy "free money" for the last 10 years, i.e. there was virtually no cost to borrow capital since the start of the Great Recession. What did we get? 10 years of average growth, which coming out of the Great Recession should not be scoffed at, as compared to what it took to get us out of the Great Depression.

 

I have no idea what-the-**** you are talking about, Mr Economist. My macro economy class is about 40 years in my rear view mirror.

But I have naively noticed that over the last 10 years that both China and India have had above average economic growth, lifting a large percentage of the world's population out of poverty. It must be true, for I read it on The Internet.

Perhaps the US Fed's free money economic policy lead to a global economic boom?

 

The idea behind petro dollars is by making the US currency an official reserve currency it would help keep interest rates and inflation lower as it would make dollars more useful (from increased liquidity) and increase demand for US securities.

I think that's only part of the reason, I think part has to be the low wage pressure in the labor market

 

This didn't age well

 

Yeah, where the **** did my 401k money go? Trump, I talking to you.