You’ve likely heard that stocks are tumultuous because investors are afraid of a trade war with China. This is just plain wrong. Trade fears are the excuse. The real volatility is because we are still in a correction. Basically, Trump boosted the economy so fast that inflation had to catch up to market gains a little.
Real experts, who actually understand trade, have predicted from the start that this correction would happen and that it would probably last through the summer. Those same experts also predicted that the correction hit its ultimate bottom in March, and so far they’ve been right.
There’s one easy way to understand this. The initial sell-off in February was sparked by a better-than-expected jobs report. We got good economic news and still saw stocks tumble. That’s how we know this is a natural correction and not constant responses to Trump’s Twitter account.
Here’s the big secret. Trump knows all of this. He knows it well, and it’s exactly why tariff talks are happening now. He didn’t move forward with any of it while stocks were still climbing relentlessly. He didn’t want to spook investors. But, now that we’re in a correction, he has more wiggle room to present a tough front and negotiate some good trade deals.
As for the trade war, the numbers are already in. You don’t have to guess who will come out ahead. You can see the facts in this video.
