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Thanks for nothing, Jer.
Fed Chairman Jerome Powell gave his thoughts on the economy yesterday… and it would have been better if he just kept his mouth shut. Powell told the White House that it should keep spending money to prop up the economy as it looks to recover from the coronavirus pandemic. And you know when Jay speaks up he means business.
Jerry Interest Rates warned of a bleak future. Sadly, it doesn’t sound very far fetched at all. With economies opening slower, company revenues could remain depressed leading to bankruptcies, leading to fewer jobs, and so on. It’s a vicious cycle.
It’s of no interest
Powell didn’t stop at saying that the economy is worse off than the Bulls post-Jordan (both times). He indicated that there are no plans for the Fed to move its benchmark rate negative after dropping it to zero in March. He even went as far as to say the scope and downturn have been the worst recession since WWII. This guy has zero chill.
So, how did markets react?
As you can expect, they took a nosedive. The Dow, S&P, and Nasdaq dropped 2.17%, 1.75%, and 1.55%, respectively. But it wasn’t all Jer-bear’s fault.
Billionaire investor David Tepper took to day-time TV to say that the stock market is the second most overvalued he has ever seen it. The other time? 1999 aka the tech bubble.
The bottom line…
On the plus side, at least we don’t have to worry about inflation. Consumer prices have posted their biggest decline since 2008 at 0.8% for the month of April.
Clothes, auto insurance, flights, and hotel rooms all saw record price declines. Ah, the Four Horsemen of the Coronapocalypse.
Water Cooler Talking Point(s)
💧 “Fuckin’ Jerry. Like, I know I’m not going to be a pro-athlete either, but you don’t have to come out and say it.” (Ian, The Water Coolest HQ)
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