My job is following political influences on financial markets. I’ve been doing it for 25 years and I am good at it. Fixing the proximate cause for a one day or one week move in the markets is a mug’s game. This economy is strong as hell. Tariffs are kicking in. Wage hikes are kicking in. Oil prices are poised for another upside breakout. There’s a lot of inflationary signals in the economy, and all the people on this thread who think that interest rates should not be going up in that context are just fools. Those higher rates long and short, have an impact on the outlook.
Concur. Inflation is hidden and tame at the moment. How quickly people have forgotten the financial terror of rampant inflation and its devastating effect.
Absolutely correct that interest rate increases are justified. In fact, Trump totally predicted this in the 2016 campaign.
During that period Trump said interest rates needed to be raised back then and predicted that for political purposes that Ma Fed, Janet Yellen, would continue to protect Obama and not do so. Trump correctly predicted that the Feds would begin to raise rates during his term. We all knew the game and we all knew he was right.
A big dip? Yeah, but I’m not worried. Letting off a little steam is healthy and good for the market long term.
Well, the Chairman of the Fed just said we had a very vibrant economy, with low unemployment, growing GDP, and very low inflation.