So instead of ad hominems, dispute his thesis.
It’s a simple one:
“Since October The Fed has single-handedly dismantled the US economy. The Trump tax cuts at year end 2017 set the economy on fire. The US stock markets set numerous records. So the Fed had to step in and kill the economy or, God forbid, he would get re-elected in 2020!”
He’s imputing a political motive to the Fed’s actions, not an economic one. If it’s a well tested and agreed upon economic motive - you know, too much “irrational exuberance” - then point that out and defend it.
You and Jerry Powell need to enlighten us all about the macro-economic wonderfulness of simplistic rate change mechanisms. Right now, I’d say the carnage in the markets show that at minimum, there are major players on the planet who simply don’t agree and are voting with their cash.
Is a market in free fall the intended effect of Jerry The Genius’ actions, and if not, then how come he didn’t understand that?
His thesis is as stupid as one would expect from someone so incredibly stupid.
Trump/Ryan/McConnell tax cuts added growth. Yes they did, in year one. But there is no additional added growth in year two. In terms of GDP and earnings it’s “permanent” but in terms of GDP GROWTH and EARNINGS GROWTH, it’s a one-time stimulus. The same with the massive deficit spending push, which was just as big as the tax cut. It’s a sugar high, but it fades. This is currently happening, and it’s happening at the same time that Trump’s trade war is adding to the worries of the market, and at the same time that China itself, the swing variable in global growth, is facing serious growth headwinds for the first time in 25 years.
To say that this 1/4 point move by the Fed is “killing the economy” is pure nonsense. Rates are incredibly low, still, well below “neutral” in other words they are still providing stimulus not tightness to the economy.
Sometimes the stock market gets too high and it declines. These declines are better not ascribed to policy malice without first considering the notion of VALUATION. By sophisticated valuation metrics like the CAPE Shiller PE ratio, the stock market in October was at the highest level ever with the exception of early 2000, and late 1929. It was a piece of shit. I’m sorry to all who lost money. I even lost some myself, but once this bloodbath is over, there may be some cheap stocks, and I will buy them.