Today, I see negligence and delusion as the new real reality that we are living in. The soul driver of the U.S. markets is no longer fundamentals or reasoned speculation—it is sheer euphoric exuberance, moody and reactive to sentiment rather than sound policy or performance. Market highs are being celebrated as indicators of recovery and strength, but I believe we are witnessing the classic symptoms of a dead cat bounce—a temporary recovery in asset prices after a major decline, which is doomed to collapse again. Let’s begin with what we are seeing from a political and policy standpoint. My assessment of Donald Trump is that he tends to be overreactive, often imposing rules and restrictions in a highly erratic manner. On several occasions, he has been seen scaling down severe measures to less-than-moderate levels soon after announcing them. A recent example is the imposition of massive tariffs on China, despite the fact that the two countries share a significant trade deficit. These m...
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