Dow drops 653 pts in 1/2 day - Trump blames (of course) somebody else....

[candycorn]

But when the stock market began to boom days after Trump was elected, you guys said it had nothing to do with Trump, that it was all thanks to Obama. When the boom continued after Trump took office, you guys still said it had nothing to do with Trump. But now that the market is undergoing a long-overdue adjustment, oh, *now* it's Trump fault!

By the way, the stock market is still far above where it was when Trump was elected. On election day, the market stood at 18,332. As of yesterday, it was at 21,792. So the market is over 3,000 points higher than it was the day Trump was elected.

For the time being.

 

[Pilot1]

Presidents don't control the stock markets. All they can do is try to contribute to a positive business environment through Tax, Energy, Trade, and other policies that affect the economy. The Stock Market is NOT THE ECONOMY.

The Fed interest rate hikes have more effect on the Stock Markets right now than anything the President, or the Government can do. It is basic finance, and economics. Higher interest rates give investors attractive alternatives for investment that are dependent upon interest rates, and those are NOT STOCKS.

 

[Toro]

The Dow going up was all thanks to President Trump. Now that it going down it’s the fault of the Fed or something.

No, no, no...you people said the Dow / economy was the Kenyan Chimps economy...remember?

Sorry, I did no such thing. If President Trump gets credit for the rise than he gets the blame for the fall. Don’t like it? Tough shit.

Hey look, I’m simply exposing your filthy friends and what they all said. They said Trump “inherited” the Kenyan Chimps economy. No walking it back now.

You would rather the vile sob in our wh to have inherited gwb's economy?? We were going up ...trumps tax cuts took it further Now the ah who shoots from the lip is bringing it down

Between Trump's wall and six investigations into his foundation, transition team, campaign, white house, inauguration, collusion with Russians and administration, Trump is simply incapable of leading.

So he's doing and saying a lot of stupid things now.

And the markets are reflecting it.
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Trump isn't the primary reason for the stock market decline.

He's making it worse by saying he might fire Powell. And his tariffs - i.e. trade "taxes" - are not good for the economy.

But the primary reason why the stock market is falling is because interest rates are rising and the Fed is unwinding quantitative easing.

 

[Toro]

Sorry, quarter % hike, if in fact everything is up & doing better why would a quarter % hike cause all this craziness. if its not raised now we wont be able to reduce it when the next recession happens.

It's not a single quarter point hike that matters. What matters is the cumulative effects of interest rate hikes that help drain liquidity in the financial system, which has been happening for some time.

 

[Mac1958]

But the primary reason why the stock market is falling is because interest rates are rising and the Fed is unwinding quantitative easing.

Too complicated. Not partisan enough.



By the way, did you see Powell's comments? That they're essentially putting the QT on "automatic pilot"?

Not as dumb as Mnuchin's comments, but not a smart thing to say.
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[Mikeoxenormous]

Duh Donald blaming the Fed Reserve and wants to deny:

1. HIS government shutdown
2. Erratic, out of nowhere Middle East policy change and
3. Firing of an admired and venerable former Marine General, Jim Mattis.

Biggest drop in the stock market since

He's the biggest fuck up to enter the White House since Harding.
.
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Dow Drops Below 22K, Stocks Trade Lower as Wall Street Can't Shake Steep Slide
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Awesome!
Burn this motherfucker to the fucking ground.

I hope the god that the government never recovers from what is happening and all the failed government get a permanent furlough, that the Democrats could of avoided by putting a measly ole 5 billion in the budget for the wall, that the US people want. But instead the Democrats want illegals to be here, they want more Radical Muslims from the middle east here, and like Obama did with Mattis, fired someone who follows the Democrats more than the people.

American people? Voted overwhelmingly anti trump and the GOP in last elections.

Yeah, in 2018 the votes just kept showing up, recount after recount. Some not even filled out..

 

[Toro]

[

LOLOL

Moron...

Obama:

• DJIA: UP 149%
• NASDAQ: UP 265%
• S&P500: UP 167%

Trump:

• DJIA: UP 10%
• NASDAQ: UP 11%
• S&P500: UP 4%

I posted on this board many months ago that the stock market will have done better under Obama than it will under Trump, even though Trump is much more pro-business.

The reason is simple - the valuation of the stock market was low when Obama became President and it was high when Trump became President.

Valuation has been the single biggest determinant of intermediate-term performance of the US stock market. Stocks have historically done better over a 10-year period when they have been cheap and have done poorly over a 10-year period when they have been expensive. Politics have not mattered.

 

[Toro]

But the primary reason why the stock market is falling is because interest rates are rising and the Fed is unwinding quantitative easing.

Too complicated. Not partisan enough.



By the way, did you see Powell's comments? That they're essentially putting the QT on "automatic pilot"?

Not as dumb as Mnuchin's comments, but not a smart thing to say.
.

QT has been on automatic pilot for nearly two years, so I don't have a problem with it. I think Powell is correct.

Asset markets were over-inflated pretty much everywhere because of QE. The unwinding of QE was always going to be rocky no matter when we did it. So it's being unwound, and the markets are going down.

It's going to cause a slowdown in the economy, but I think it's going to feel much worse than it will be. The stock market did much better over the past 9 years than warranted by the economy. So I think the market will fall much greater than warranted by the economy.

If you can't unwind QE when claims are at all time lows, when can you unwind it?

 

[Pilot1]

Trump isn't the primary reason for the stock market decline.

He's making it worse by saying he might fire Powell. And his tariffs - i.e. trade "taxes" - are not good for the economy.

But the primary reason why the stock market is falling is because interest rates are rising and the Fed is unwinding quantitative easing.

Ultimately, the better trade deals Trump is still NEGOTIATING will be better for our economy. It is creating some volitilty, as the Trade Partners that have taken advantage of the U.S. for DECADES push back, and complain. They will be forced to negotiate better trade deals as they need our markets more than we need theirs. That's just a FACT.

However, I agree with you that the Fed, and interest rates rising, tightening the monetary supply is the primary reason for the stock market decline, and Trump has said so. He is correct.

 

[Toro]

Just curious, Faun...did you want to take a crack at explaining why the Fed only raised interest rates twice from the time that Barry was elected until the time that Trump was elected...yet has raised them six times in the two years that Trump has been President? You seem to be declaring that Obama was great with the economy and Trump has not been...yet the Fed who makes policy based on the strength of our economy didn't seem to agree with you AT ALL!

You use statistics to mislead...not illuminate!

That's because the economy was weak under most of Obama's tenure and has been significantly stronger under Trump. When the economy is strong, rates go up. When the economy is weak, rates are low.

The Fed did keep rates too low for too long under Obama. We are now unwinding that policy, and it's causing turmoil in the stock market.

In the long-run, this is good for the economy even if it doesn't feel like it.

 

[there4eyeM]

The stock market is responding to the slowing of easy money for financial investing. The money should never have been provided for that in the first place, as it only contributes to speculation, bubbles and crisis for the whole economy stemming from one selfish part.
Investment for the creation of wealth should be cultivated. Investment for mere dollar accumulation should not be underwritten by the public.

 

[Mac1958]

But the primary reason why the stock market is falling is because interest rates are rising and the Fed is unwinding quantitative easing.

Too complicated. Not partisan enough.



By the way, did you see Powell's comments? That they're essentially putting the QT on "automatic pilot"?

Not as dumb as Mnuchin's comments, but not a smart thing to say.
.

QT has been on automatic pilot for nearly two years, so I don't have a problem with it. I think Powell is correct.

Asset markets were over-inflated pretty much everywhere because of QE. The unwinding of QE was always going to be rocky no matter when we did it. So it's being unwound, and the markets are going down.

It's going to cause a slowdown in the economy, but I think it's going to feel much worse than it will be. The stock market did much better over the past 9 years than warranted by the economy. So I think the market will fall much greater than warranted by the economy.

If you can't unwind QE when claims are at all time lows, when can you unwind it?

I don't like the idea of anything being put on automatic pilot. Yes, Powell is bringing some (unexpected) tough love to this mess, and no one (outside of politics) can argue that it doesn't need to be done, but "automatic pilot" suggests intellectual rigidity and a lack of attention.

I think we have more than enough intellectual rigidity right now. It's one (good) thing to have a clear and defined overall direction, but the Fed (which now appears to be the Center of the Universe) has to signal that it will make minor course corrections if and when necessary. Auto-pilot it the opposite of that.

It may just be semantics, but markets don't seem to care.
.

 

[Toro]

Ultimately, the better trade deals Trump is still NEGOTIATING will be better for our economy. It is creating some volitilty, as the Trade Partners that have taken advantage of the U.S. for DECADES push back, and complain. They will be forced to negotiate better trade deals as they need our markets more than we need theirs. That's just a FACT.

However, I agree with you that the Fed, and interest rates rising, tightening the monetary supply is the primary reason for the stock market decline, and Trump has said so. He is correct.

I work in the investment business. In my job, I get to talk to some of the smartest people on Wall Street. (FTR I don't consider myself to be one of those people.) In the winter of 2016, I'd ask these very smart people "What would you do if the US slapped a 40% tariff on all goods coming from China?" which is what Trump was promising at that time. Almost to a man, they'd all say "Trump's not going to become President." Then I'd say, "I didn't ask you if Trump was going to become President. But let's pretend that he does and he slaps a 40% tariff on all goods from China. What would you do?" And almost to a man, they'd say "I'm going to cash," meaning they'd sell everything.

For the most part, markets have taken the tariffs in stride, at least until recently. But tariffs are ultimately bad for business because they raise taxes, reduce profits, and make the economy less efficient. Capital has been the biggest benefactor of globalization. Trump has been retreating from globalization, as many in his base want. But this retreat from globalization is bad for capital. So it's not surprising to see the market reacting negatively to tariffs. The market isn't going down primarily because of tariffs but tariffs are helping the market go down.

We are beginning to hear from company CEOs that they are delaying capital expenditures and hiring next year because of the uncertainty of tariff policy.

 

[Toro]

I don't like the idea of anything being put on automatic pilot. Yes, Powell is bringing some (unexpected) tough love to this mess, and no one (outside of politics) can argue that it doesn't need to be done, but "automatic pilot" suggests intellectual rigidity and a lack of attention.

I think we have more than enough intellectual rigidity right now. It's one (good) thing to have a clear and defined overall direction, but the Fed (which now appears to be the Center of the Universe) has to signal that it will make minor course corrections if and when necessary. Auto-pilot it the opposite of that.

It may just be semantics, but markets don't seem to care.
.

I think that if the economy really starts to slow, they'll hold back.

The problem is that the market is having a temper tantrum. Markets were expecting that the Fed would not only not raise rates next year but would stop with QT completely. That didn't happen.

Market participants have gotten so used to having a Fed put on the market that whenever the market starts looking rocky, they expect the Fed to become über-dovish and come rescue them. And when the Fed isn't über-dovish, the markets stomp their feet like a petulant child until they get their way. That's what's happening now.

Of course, market participants have been trained to act like that because that's how the Fed has been behaving for two decades.

The Fed has gotten us into this mess. Now they are trying to get us out. I give Powell credit for doing this.

Speaking of petulant, Trump has got to STFU. Him talking about firing Powell is making things worse. What a disaster that would be if he did so. The SP500 would get to 2000 in a hurry.

 

[Mac1958]

I don't like the idea of anything being put on automatic pilot. Yes, Powell is bringing some (unexpected) tough love to this mess, and no one (outside of politics) can argue that it doesn't need to be done, but "automatic pilot" suggests intellectual rigidity and a lack of attention.

I think we have more than enough intellectual rigidity right now. It's one (good) thing to have a clear and defined overall direction, but the Fed (which now appears to be the Center of the Universe) has to signal that it will make minor course corrections if and when necessary. Auto-pilot it the opposite of that.

It may just be semantics, but markets don't seem to care.
.

I think that if the economy really starts to slow, they'll hold back.

The problem is that the market is having a temper tantrum. Markets were expecting that the Fed would not only not raise rates next year but would stop with QT completely. That didn't happen.

Market participants have gotten so used to having a Fed put on the market that whenever the market starts looking rocky, they expect the Fed to become über-dovish and come rescue them. And when the Fed isn't über-dovish, the markets stomp their feet like a petulant child until they get their way. That's what's happening now.

Of course, market participants have been trained to act like that because that's how the Fed has been behaving for two decades.

The Fed has gotten us into this mess. Now they are trying to get us out. I give Powell credit for doing this.

Speaking of petulant, Trump has got to STFU. Him talking about firing Powell is making things worse. What a disaster that would be if he did so. The SP500 would get to 2000 in a hurry.

Trump won't STFU, he's not going to change, he has no idea what he's doing. And Mnuchin's comments were a perfect example of a clueless administration.

I agree that this medicine is needed, as long as we're keeping an eye on things. Real estate has fallen off the table in important areas, and as you point out above, business capex may tail off. Plus we have this guy in the White House. We just have to keep our hands on the freakin' wheel here.
.

 

[PredFan]

Duh Donald blaming the Fed Reserve and wants to deny:

1. HIS government shutdown
2. Erratic, out of nowhere Middle East policy change and
3. Firing of an admired and venerable former Marine General, Jim Mattis.

Biggest drop in the stock market since

He's the biggest fuck up to enter the White House since Harding.
.
.
Dow Drops Below 22K, Stocks Trade Lower as Wall Street Can't Shake Steep Slide
.
.

The stock market is going down because interest rates are rising and the Fed is reducing the size of its balance sheet.

Trump's tariffs and his idiotic bleatings about Powell are adding to it, but Trump isn't the primary cause of the decline.

You are mostly correct. The Trump haters here will never accept that.

 

[Pilot1]

I work in the investment business. In my job, I get to talk to some of the smartest people on Wall Street. (FTR I don't consider myself to be one of those people.) In the winter of 2016, I'd ask these very smart people "What would you do if the US slapped a 40% tariff on all goods coming from China?" which is what Trump was promising at that time. Almost to a man, they'd all say "Trump's not going to become President." Then I'd say, "I didn't ask you if Trump was going to become President. But let's pretend that he does and he slaps a 40% tariff on all goods from China. What would you do?" And almost to a man, they'd say "I'm going to cash," meaning they'd sell everything.

For the most part, markets have taken the tariffs in stride, at least until recently. But tariffs are ultimately bad for business because they raise taxes, reduce profits, and make the economy less efficient. Capital has been the biggest benefactor of globalization. Trump has been retreating from globalization, as many in his base want. But this retreat from globalization is bad for capital. So it's not surprising to see the market reacting negatively to tariffs. The market isn't going down primarily because of tariffs but tariffs are helping the market go down.

We are beginning to hear from company CEOs that they are delaying capital expenditures and hiring next year because of the uncertainty of tariff policy.

I agree that tariffs are a tax, but ultimately, I see the negotiating strategy of Trump as sound. Through the THREAT of tariffs he is attempting to get our trading partners to reduce, or eliminate theirs. Why is it OK for Europe, China, Japan, and many other counties to put huge tariffs on our goods, with no fear of accountability?

How has Trump retreated from globalization? Yes, he wants to retain U.S. Sovereignty, but we are certainly not isolationists.

BTW, I'm an Asset Manager so talk to some of the same kind of people you do. They've been wrong, as much as they've been right.

 

[Toro]

Trump won't STFU, he's not going to change, he has no idea what he's doing. And Mnuchin's comments were a perfect example of a clueless administration.

I agree that this medicine is needed, as long as we're keeping an eye on things. Real estate has fallen off the table in important areas, and as you point out above, business capex may tail off. Plus we have this guy in the White House. We just have to keep our hands on the freakin' wheel here.
.

I agree.

But again, the rise in real estate was induced in part, though not entirely, by the Fed and their ridiculously low interest rates. Oddly, we have a very bifurcated real estate market. We have too many upper end homes and not enough on the lower end. If you look at NAHB data, there's roughly 7 months of supply, slightly above the long-term average of ~6 months. But at the upper end, there's 9 months of supply and at the lower end, there's 3 months. All the homebuilders have been focusing on the upper end because they can make profits there but can't make a dime on the lower end because of increasing costs and regulations. And the silly prices are in certain metro areas. Where I live, home prices haven't gone crazy. But they have in other parts of the state.

There's also too much retail space and too many restaurants. Some of that supply is going to have to be wiped out.

 

[edward37]

Duh Donald blaming the Fed Reserve and wants to deny:

1. HIS government shutdown
2. Erratic, out of nowhere Middle East policy change and
3. Firing of an admired and venerable former Marine General, Jim Mattis.

Biggest drop in the stock market since

He's the biggest fuck up to enter the White House since Harding.
.
.
Dow Drops Below 22K, Stocks Trade Lower as Wall Street Can't Shake Steep Slide
.
.

The stock market is going down because interest rates are rising and the Fed is reducing the size of its balance sheet.

Trump's tariffs and his idiotic bleatings about Powell are adding to it, but Trump isn't the primary cause of the decline.

You are mostly correct. The Trump haters here will never accept that.

Yes the market loves the uncertainty trump brings to our nation

 

[edward37]

Trump won't STFU, he's not going to change, he has no idea what he's doing. And Mnuchin's comments were a perfect example of a clueless administration.

I agree that this medicine is needed, as long as we're keeping an eye on things. Real estate has fallen off the table in important areas, and as you point out above, business capex may tail off. Plus we have this guy in the White House. We just have to keep our hands on the freakin' wheel here.
.

I agree.

But again, the rise in real estate was induced in part, though not entirely, by the Fed and their ridiculously low interest rates. Oddly, we have a very bifurcated real estate market. We have too many upper end homes and not enough on the lower end. If you look at NAHB data, there's roughly 7 months of supply, slightly above the long-term average of ~6 months. But at the upper end, there's 9 months of supply and at the lower end, there's 3 months. All the homebuilders have been focusing on the upper end because they can make profits there but can't make a dime on the lower end because of increasing costs and regulations. And the silly prices are in certain metro areas. Where I live, home prices haven't gone crazy. But they have in other parts of the state.

There's also too much retail space and too many restaurants. Some of that supply is going to have to be wiped out.

Sears is helping with that ,,Macy's closing many stores etc etc