July 11, 2019 | Party On, Wall Street!

The Dow closed above 27,000 for the first time on Thursday, giddy over the Fed chairman’s recent embrace of more easing. In two days of testimony before Congress, Powell left little doubt that the central bank is about to lower interest rates by 25-50 basis points. However, only a moron could believe this will mitigate the impact on the U.S. economy of slowdowns in Europe and China that are already well under way. What it will do is goose U.S. asset prices so that they are even more insanely overvalued than they are now, which in turn will attract flight money from Europe and China. Sounds like a perpetual motion machine, right? We all know that such a contraption does not exist, and that pumping U.S. stocks into the ionosphere at a time when business around the world is slowing dramatically is a recipe for disaster. Party on, Wall Street!
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Rick Ackerman July 11th, 2019
Posted In: Rick's Picks
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