The big news in the UMich data was not inflation expectations. Look at what people are saying about the jobs market! Expected change in unemployment worst since the 2008 recession. No one is asking for a raise in this environment. https://x.com/RenMacLLC/status/1900550337498321398
"A recession is worth it." Those shocking words came straight from Trump's Commerce Secretary Howard Lutnick. The markets are in free-fall. Wall Street's panicking. And Main Street's about to feel the pain. Here's what's really happening: https://x.com/themarketsniper/status/1900216288427074023
Lutnick claims any recession would be "because of Biden's nonsense." But his own words tell a different story: "These policies are the most important thing America has ever had, so it is worth it." Worth what exactly? Let me explain: https://x.com/themarketsniper/status/1900216467553214855
Trump's new economic experiment centers on aggressive tariffs. But here's the twist: The reasons keep changing. One day it's jobs. Next day it's making Canada the 51st state. Even Trump's own advisers can't keep up with the shifting narrative. https://x.com/themarketsniper/status/1900216705743561024
The results are already devastating: The S&P 500 has plunged 9.3% from its February peak. Major banks are now predicting a 40-60% chance of recession. But that's just the surface-level damage... https://x.com/themarketsniper/status/1900216723279929804
CNBC analysts are breaking rank: "What President Trump is doing is insane. It is absolutely insane." "There are no bounds around President Trump... This is very different from his first administration." The markets agree. Here's why: https://x.com/themarketsniper/status/1900216980084596990
Wall Street severely miscalculated. They thought Trump's tariff talk was just campaign rhetoric. They believed he'd focus on tax cuts and deregulation. Instead, he's launched the most aggressive trade war in modern history https://x.com/themarketsniper/status/1900217255113482331
Investment strategist Ross Mayfield puts it bluntly: "There's a tolerance for pain that investors hadn't priced in." Translation: Trump's willing to let markets burn. But there's an even darker reality emerging: https://x.com/themarketsniper/status/1900217271848685573
The chaos might be intentional. Market insiders who know Trump's next move can: • Buy the dips • Predict the spikes • Profit from the volatility While regular investors watch their 401(k)s evaporate
The damage isn't contained to Wall Street. Supply chains are scrambling. Manufacturing is freezing. Consumer confidence is plummeting. And American workers will pay the price. https://x.com/themarketsniper/status/1900217302320373815
Meanwhile, foreign capital is fleeing, from the bond markets, and now potentially the hyper-valued stock markets. With the collapse in the US bond markets over the last 4 years Our ability to fund deficits is at risk. Equity, and housing markets are destabilizing. And inflation readings, whilst down recently, could revert back up ominously Yet Lutnick insists: "It's worth it."
The stark reality:
This isn't a normal market correction.
This isn't typical policy uncertainty.
The US's bottomless overdraft has been pulled The 'right-sizing' of America has begun
This is an unprecedented economic reversion, with your financial security as collateral.
For regular Americans, the stakes couldn't be higher:
• Retirement accounts at risk
• Job security threatened
• Cost of living climbing
• Cuts in government costs, will lead to contagion
And we're only 50 days into this administration. https://x.com/themarketsniper/status/1900217771948204389
Trump & Lutnick need the cost of borrowing to come down [Interest Rates].
They have $9Trn in debt rollovers, to refinance and Interest rates costs are crushing American Governments finances, and the US's housing markets.
A recession fixes this, at least for a spell.
A recession will also potentially crack the US stock market.
Then there is 'Tariffs', they pump inflation everywhere, whilst there is a lot of 'hand-wringing' about the pain for the consumer.
"Shock Fact", in truth inflation devalues the debt mound, something badly needed.
In short 'Stagflation' as an outcome, whilst made to look like an accidental outcome, may well be planned policy.
In the 70's 'Stagflation', was brutal on living standards, the stock market and housing.
This could be the big one! What comes may make 'the big short' look tiny by comparison! When markets get unpredictable, traditional trading indicators fail.
...Overnight Wall St rebounded from highly oversold levels: Dow +674pts, S&P500 +2.12% to 5638 and Nasdaq +2.61% to 17.754
...the highly anticipated rebound came a few days later than what we would have expected to be normal
...but it didn't rebound because the worsening outlook is looking like turning around
...in fact it is the opposite: Michigan 1 yr and 5yr inflation expectations have turned much higher- 1 yr has shot up to 4.9pc from 4.3pc, 5yr to 3.9pc from 3.5pc- higher inflationary expectations typically becomes a self fulfilling prophecy
...while Michigan consumer sentiment crashed from 64.7pc the previous month to 57.9pc; consumer expectations also crashed to 54.2 vs 64.3 est and 64 from previous month
...suffice to say that all the chaos from Trump's tariffs and the layoffs from DOGE are having a major impact on consumer confidence https://x.com/SuburbanDrone/status/1900586547663020193
...making the spectre of a US recession even more probable in the near horizon.
..it has begun.
Junk bond yields just broke above the 2025 peak of 7.43%, signaling escalating risk in corporate credit. It’s too early to call a full-blown collapse, but this is a clear risk-off signal—money is rotating out of corporates. https://x.com/kurtsaltrichter/status/1900624983048458282
NEGATIVE WEALTH SHOCK B/c households are massively OW stocks, the current 10% market decline has created a wealth shock equivalent to 12% of GDP. 10% corrections are typical (53 since 1950). But, wealth shocks are rare (13). The economy is more vulnerable to a stock decline https://x.com/WarrenPies/status/1900529370189496493
