Trump On Thin Ice With Traders As US Stocks Sink Third Day
“I don’t watch the stock market”.
“I don’t watch the stock market”.
“We have traded up on such optimism before, only to then be let down”.
“Expectations are extremely volatile”.
“President Trump needs to sign the bill using braille”.
How dramatic would the unwind be?
All of this is playing out against a backdrop defined by a (rare) dearth of news flow…
There’s plenty of optimism, but when it comes to trade, market participants are understandably jaded.
It’s the flip-side of the overwrought, hair-on-fire rhetoric that accompanies selloffs.
Where to now?
Cue a backtest.
It’s now just a matter whether the bubble merely deflates, or actually bursts in earnest.
That could be good or bad.
“He believes the United States will go on to exceed even its remarkable achievements of the past”.
This may mean that the market has become too comfortable with the trade outlook.
Rampant optimism is now reinforcing the Fed’s message that rate cuts are done.
What could go wrong?
The two sides “are in the process of resolving outstanding issues”.
“Good and easy to win”, he said.
You can thank margin pressure and slowing global growth.
“All of this impeachment nonsense” and what not.
“I am adding to my shorts here”.
Don’t show him a dollar chart.
“Tantrum” risk comes calling.
“Compression of risk premia is only a side effect”.
Impeachment bluster and aggressive trade banter make for a bitter pill.
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