With Wall Street posting its worst December since 1931, NASDAQ, the tech engine of the stock market, said that we've entered a bear market, as worries about incompetent demagogue Donald "Rump" Trump's bizarre economic policies drive down the markets. The mid-cap S&P 400 confirmed that the bear market analysis. Just in the past week, the S&P 500 fell 7%, the Dow fell 6.8%, and the NASDAQ fell 8.4%. That will hit anyone with a 401(k) savings/investment account.
The foremost concern is Rump's tariff/trade war with China, the second largest economy in the world, with a deadline for negotiations expected to pass without agreements in place. The Trump government shutdown has also raised concerns that Rump is unable to negotiate a deal which would keep the government running. To top it off, there are reports that Rump has talked about firing Federal Reserve Chairman Jerome Powell -- his own appointee -- over the Fed's decision to raise interest rates four times over the past year. For Rump to fire Powell would be unprecedented and possibly illegal, not that Rump wouldn't try:
"The independence of the Fed is one of the pillars of confidence global investors have in the U.S. financial system. Powell's removal would undermine that confidence because it would now seem the most important central bank was now under the control of a politician, who may not always have the best interests of the economy at heart. Sometimes it's necessary to raise interest rates to keep inflation in check. [snip]
If Trump were to try to remove Powell or force his resignation it could cause the market to drop at least another five percent, according to Jeff Kilburg, CEO of KKM Financial in Chicago."All Rump had to do was to maintain the economic policies of President Obama which gave us over 7 years of growth and decreasing unemployment. Instead, he blew up trade agreements, imposed damaging tariffs, passed a tax giveaway to the top one percent which gave them a brief "sugar high," and added over a trillion dollars to the debt. For some one who bragged that he alone could fix it, he fixed it alright.
