Government Shutdown, Trade War, And The Market

Deal or No Deal? That is the billion-dollar question on both sides of the Atlantic.

Despite what we’ve been led to believe, the Federal Reserve Bank of the United States is not a benevolent government agency set up to act in the interest of the public. Instead, it’s a private entity set to act as the means to fund the U.S. government with the mandate by Congress to provide for maximum employment and stable prices.

Stable prices, to the Fed, mean that the level of inflation that’s acceptable is around 2%. Banks want inflation to boost lending profits.

The Federal Reserve is simply an organization set up to make sure banks are profitable and the U.S. government has resources to fund its trillions of dollars in mostly wasteful spending.

We, the public, don’t need a central bank to help guide our economy and the idea that the Fed has the tools to do so, is ridiculous.

It Does More Harm than Good…

The Fed is more likely the cause of financial disruptions than it’s been helpful in avoiding them.

The Fed does have the power to move the markets through its actions, and traders like us will try and profit from those moves.

Federal Reserve Chair Jerome Powell has been steadily losing credibility with the markets since December’s rate hike.

Powell’s comments after the December policy meeting indicated that Fed policymakers lowered estimates for additional rate hikes in 2019 from three to two and lowered the estimate for the neutral rate from 3% to 2.8%.

Stocks have yo-yoed since the meeting.

After last Wednesday’s release of the meeting minutes…

Major news outlets have heralded the end of this historic bull market. Yet America’s

…it’s clear that there’s uncertainty about the timing of future hikes.

While many Fed officials are willing to be patient on any further hikes, a few officials favored not hiking in December, and others believe that downside risks have increased.

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