Trump Has The Stock Market and Fed Cornered
The stock market selloff continues amid the escalation of the trade wars between the US and 180 other countries. It’s left investors asking the questions:
Where is the bottom?
Are we headed for a recession?
Unfortunately, the answers are largely rooted in the decisions that President Trump makes in the coming days and weeks. There have been talks about the Fed decreasing rate, tax reform getting passed sooner, negotiations beginning with 50 of the 180 countries that we placed tariff on, but in this article we are going to explain why all of these solutions may be too little too late when it comes to the overall negative impact that tariff are currently having on the US economy.
A Market Selloff Triggered By A Fed Policy Error
The Fed made a significant policy error last week by deciding not to cut the Fed Funds rate and the stock market is now responding to that error via the selloff we have seen over the past week. Unfortunately, this policy error is nothing new. Throughout history, the Fed typically waits too long to begin reducing interest rates after inflation has already abated and they seem to be on that path again.
This Market Rally Could Be A Bear Trap!! Here’s why……
The recent stock market rally could end up being a bear market trap for investors. If it is, this would be the 4th bear market trap of 2022.
