Quote:
Originally Posted by MrBaldBastard
Trump has put in place inflationary policies, all currency has fallen to the USD this year, The Chinese and all us foreign webmasters are all making more because of it.
Only ones hit is the American consumer paying the hidden tariff tax.
Call it Import tax and it might sink in better.
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correct and this problem will become even bigger when more fresh money is pumped into the market and given to people who will not pay it back but increase the demand.
this will produce even higher prices and the fed can only answer with higher interest rates.
higher interest will:
a. move money from the stock market to fixed deposits
b. bring a higher demand on the dollar because also money from outside will go where the high interest ist.
and the consequence is a even higher dollar what makes imports cheaper and exports
harder.
plus: there will be too much money in the loan market because the demand on loans will decrease.
you can guess 3 times what they will do than.
they will payout credits to people what are even more unable to pay it back and we are back in 2004-2008 when that bubble crashed.
if they do not do that the us will pay higher interst for foreign money that nobody else want to borrow than the financially broken.
if the import prices will increase all that happens just faster because the consumer prices will rise to the sky.
and no - the FED is not crazy when they increase the interest - it is their one and only chance to react on things what have been so predictable wrong.
no matter what the stock market is doing in the next few weeks - it might go up and down - the destination is already stone-chiseled.
it would be the first time in the history of economy when this would not happen and there is not one logic reason for that.