Capital flows to where it’s treated well. Remember this amid President Trump’s endless jawboning of Jerome Powell. According to Trump, along with his various cheerleaders inside and outside the administration, the Fed’s failure to lower its funds rate is what is holding back an even bigger boom. If you deduce from this that it’s Republicans cheering on market intervention on the naïve assumption that it will lift the economy, you’re on the right track.
Forget for a moment that the very drivers of economic and stock market vitality at the moment (think Nvidia, Meta, Amazon, Apple, Tesla, etc.) were all too risky by many exponents to rate interest rate-informed finance on their way up, and just think about the broader illogic of all the jawboning, cheerleading, and insults: it all presumes that the Fed’s rate fiddling can overcome the global market for capital itself, and the powerful need of those with title to capital to place it where it will be treated best…
