Trump Throws the Markets a Curve


It’s warm and sunny in Florida and Arizona, where baseball’s spring training is underway.

It’s the time of year when players are chipper, managers are geniuses, and fans of every team from the world champion Houston Astros and the new Murderers’ Row New York Yankees to the cellar-dwelling Detroit Tigers and Philadelphia Phillies think they have a good shot at winning it all.

Meanwhile, a Nor’easter has pelted the middle Atlantic states with wind, rain, even snow, and a different kind of storm engulfed Wall Street. Since Tuesday, the Dow Jones Industrial Average has lost more than 1,000 points and the S&P 500 is down nearly 100 (although both rallied off their lows).

Gurus and pundits blamed it on two things. First, new Federal Reserve Chair Jay Powell’s Congressional testimony, in which he noted how good the economy was, led some traders to conclude there would be four, not the expected three, rate hikes this year.

And then on Thursday, President Donald Trump announced he would impose 25% tariffs on steel and 10% tariffs on aluminum imports to protect American jobs. The move surprised many as the corporate free traders in the administration lost to the economic nationalism that had defined his presidential campaign.

So, which one mattered more? And what’s next?

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