This week in Bidenomics: Early exit

Published On Dec 21, 2024, 10:00 AM

The Federal Reserve is adjusting its monetary policy in light of expected policy changes under Donald Trump. Fed Chair Jerome Powell indicated that Trump's proposed policies could lead to inflation, requiring the Fed to reconsider its approach towards interest rate cuts. Although the Fed cut rates by a quarter point, market reactions were negative, with stocks falling as fears of inflation and increased regulation grew. Analysts believe the incoming administration's policies may lead to stagflation, with anticipated slower growth and rising inflation.

Stock Forecasts

SPY

Negative

Given the potential for increased regulatory burdens and tariffs under a Trump administration, alongside recent market reactions, investors should be cautious. Companies that rely heavily on consumer spending or have thin margins might see decreased stock performance as inflation impacts consumer behavior and costs associated with tariffs emerge.

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