Macro Tourist

Macro Tourist: Here’s Why The Market Is ‘Screaming Higher’

"Let me give you my interpretation of what's happening".

Read more from The Macro Tourist   The stock market has been on a tear recently.  There are lots of reasons being tossed around, but let me give you my interpretation of what's happening. This will be a simple explanation.  No doubt there are more factors at work than my rudimentary theory, yet this is my working assumption as to the source of the violent rally. The US is the G10 country with the most aggressive fiscal policy stance.  To get a sense of the extent of that accommodation, have a look at the US Federal Government outlays since the GFC.   Notice how during the Obama administration, the Federal Government outlays fell. Since then they have been steadily creeping higher.  So much so that they recently hit the most accommodating levels in the past decade. In our balance-sheet-constrained environment, a Federal government willing to push the fiscal gas pedal down to the floor is a rare and welcome sight.  This is causing the US to be the best performing economy out there. However, in 2018 Jay Powell was worried about a financial asset bubble.  When he took the helm of the FOMC, he was determined to nip any developing bubble in the bud before it
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2 comments on “Macro Tourist: Here’s Why The Market Is ‘Screaming Higher’

  1. Anonymous says:

    Won’t the tank run out and the fuel pump burn up eventually?

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