Posted on 10/11/2018 7:49:48 AM PDT by SeekAndFind
Donald Trump hit out at the Federal Reserve on Wednesday, accusing them of “going loco” over interest rate hikes this year, hours after the worst US stock market sell-off since February.
Mr Trump said in an interview on Fox News that the market plunge was not because of his trade conflict with China, instead blaming the US central bank. “That wasn’t it. The problem I have is with the Fed,” he said. “The Fed is going wild. They’re raising interest rates and it’s ridiculous. The Fed is going loco.”
He added: “They’re so tight. I think the Fed has gone crazy.”
Mr Trump appeared to blame the Fed for a stock rout that market analysts mostly attributed to fresh concern about his trade war with China.
The broad US stock market sell-off on Wednesday took the S&P 500 to the lowest in three months, the Dow Jones Industrial Average plunged as much as 836 points and the Nasdaq 100 Index tumbled more than 4 per cent for its worst day in seven years.
The sell-off came a day after the IMF said the world economy was plateauing and cut its growth forecast for the first time in more than two years, blaming escalating trade tensions and stresses in emerging markets.
Mr Trump has slapped tariffs on $250bn (£190bn) in Chinese goods this year, and Beijing has retaliated with levies of $110bn of American products. The IMF projections don’t take into account the president’s threat to expand the tariffs to effectively all of the more than $500bn in goods the US bought from China last year.
Mr Trump has been publicly criticising the Fed - led by Chairman Jerome Powell, whom he appointed - since July for interest-rate increases and declared he was “not happy”
(Excerpt) Read more at yahoo.com ...
Spanish for crazy > it’s been popular in the US for as long as I’ve been around.
Well, Trump could argue his economy is doing so well the Fed is worried about inflation and that is the reason for the rise in rates which he detests.
...
He could, but I think he knows that growing economies don’t cause inflation.
Did a growing economy cause the inflation in Venezuela?
China puts tarrifs on a lot of American products. They have more to lose since we buy more from them. We can put more tarrifs on them until they cry uncle.
I personally don't think rate hikes are the major reason for the recent market setbacks. I think there are many reasons, not the least of which is that there are a lot of questions surrounding the futures of the big tech companies and Amazon - and they are the ones who created these questions.
The minute the Facebook privacy and censorship issues made the news, investors became skittish on Facebook and the stock has been reverberating since then. Now Google is under the same scrutiny, and I think it's a concern to investors that anti-trust moves against major tech companies, and Amazon, could happen. The politicization of the tech industry is undermining its stability.
I don't like saying this, because I'm invested, but it is a major consideration. The market runs on emotion as much as anything else, and the ‘feeling’ about these big tech companies has changed. This could change again, and enthusiasm restored, if they commit to being ‘serve everybody’ loyal American tech companies that refuse to be political and refuse to censor. At this point, what they will do and how this will play out is not clear.
Based on past observations, nothing spurs the Fed into action like wage gains for America’s hourly workers. That’s a sign of inflation, don’t you know. And in Trump’s economy, hourly workers are realizing their first significant gains in many years and the Fed just can’t abide that so they have to hit the brakes.
I hope people have had "the conversation" with their parents. There are situations around here where the grown kids thought the house was an asset....they never knew it was reverse mortgaged! And they should be paying for those life insurance policies the parents got years ago. Many of those old policies have a whole lot of value, and it's gone if the folks can't afford the payments.
I wish Economics were taught like it used to be. I've run into "financial advisors" who like to give us old folks free fancy prime rib dinners and then sell us an annuity because we're too feeble to manage our money, or whatever. I always raise my hand and ask one question: "Do you know the rule of 72"? It's astounding how many don't!
I suggest you read a bit more about the selection process. Aside from the Board of Governors, the Federal Reserve is no more “federal” than Federal Express.
bmp
Dropping interest rates is a tool to give an ailing economy a boost. If you keep interest rates at zero, you lose having that tool when you need it. The time to raise rates is when the economy is strong, like now.
He's right. Cramer on CNBC just talked about dumping real estate from investment portfolios because rising rates have popped a cap on the real estate boom in places like CA and AZ (his wife's a realtor). Rising rates also have an impact on the car biz (see the latest news about Ford?).
That was wrong.
How about you write Cramer and find out?
I love Trump and all he is doing, but he has fallen for hiring far too many predictably GOPe swamp creatures.
Nobody’s perfect.
Unavoidable under the circumstances.
Lots of unforced errors on that front.
But again, nobody is perfect and I am amazed at what he is managing to accomplish.
As for unforced errors, the size and scope of what he’s trying to fix, he’s going to make them.
So far nothing fatal, like Roberts, for example. Souter.
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