More Trumpian losing, both on Wall Street and with the Fed

So after the DOW Jones lost nearly 1,400 points over the last 3 trading days of last week, how did stocks respond today after a long 3-day holiday weekend? With more losing.

And stocks weren't the only financial items that were in decline today.

Major U.S. stock indexes dropped and the dollar index slid to a three-year low on Monday as U.S. President Donald Trump's continued attacks on the Federal Reserve chair and the bank's monetary policy rattled investors.

Investors flocked to safe-haven assets including gold, which hit another record high, and the Swiss franc.

Trump has been complaining about Fed Chair Jerome Powell and Powell’s continued “wait and see” approach on any changes in interest rates, as the Chair says he wants to wait for data on inflation and the economy as a whole in the wake of Trump’s tariff announcements at the start of this month.

That’s not good enough for Trump, who wants to see interest rates go down because he and Elon Musk are strung out on debt . And investors are getting spooked as a result of the President's rantings.

[Trump's] comments about Powell fueled worries about the Fed's independence in setting a monetary policy path and about the outlook for U.S. assets. Most markets were closed on Friday and some, including most of Europe, remained on holiday for Easter Monday, leading to thinner-than-usual liquidity.

Powell is "a steady hand, he's a known entity, he's stability in a world of uncertainty. He brings that calmness to the market, something people can rely on that hasn't changed stability while all this chaos is going on," said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut.

In other words, Mr. President...

Hilariously, the biggest barrier to interest rate cuts right now IS DONALD TRUMP. Putting tariffs on a widespread range of products are highly likely to raise prices for consumers no matter where the products come from. Dollar devaluation is also inflationary, even as it helps US exports due to more competitive prices overseas. But those exports now can’t get sold in other places because those other countries have been putting on retaliatory tariffs against US goods.

So if demand doesn’t fall off a cliff while prices are going up, there’s no reason for the Fed to cut rates further, because why would they want to encourage even more borrowing and more inflation? And with many US manufacturing businesses are already facing higher costs as the components and parts for their products cost more due to tariffs, that would likely counteract any help those firms might get on the interest rate front.

The only way an interest rate cut makes a lick of sense is if we get information that the economy is in free fall, with large amounts of layoffs and order cutbacks. While I can see a scenario why the recessionary free fall might happen soon, there’s no evidence of it happening today, as unemployment claims have remained low and there was a surge in new manufacturing orders and imports in Q1 to get ahead of the tariffs.

So I think the markets continued to tank today because there’s a sense from Wall Street traders about 2 things:

1. The Fed is stuck between trying to limit tariff-induced inflation, and trying to fend off a Q2 recession that is nearing inevitability. But also...

2. It feels like the wheels are completely off the Trump Train, between the Old Man's ranting against the Fed Chair and general idiocy on his tariff policy, to the drunken, careless, one-sideburn Fox News host that is in charge of the Department of Defense,, to the dimwitted Homeland Security Secretary that just had her purse stolen from a DC restaurant this weekend with $3,000 in cash and who-knows-what kinds of confidential information.

The Money Men are apparently realizing that having a GOPpuppet in charge to give away tax cuts and allow corruption isn’t as important as having people with a clue in charge. Especially if the person calling the shots is a senile rich kid that has only worked at Daddy's business, doesn’t know anything about how and why the real economy works or how and why real jobs grow and improve.