저자: JeffreyRoach · 외국인
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트럼프의 파월 연준의장 공개 비판과 관세 불확실성으로 3대 지수가 크게 하락했다. 로치는 시장이 이미 6월 이후 금리인하를 반영했고 하반기 완화가 예고돼 있어 파월 공격은 실익이 적다고 본다. 유럽 대비 미국의 잠재성장률이 높아 유럽식 인하 비교는 부적절하다고 지적했다. 시장은 관세·연준 독립성 우려에 민감하며, 확실성과 안정성을 원한다고 강조했다.
다듬은 글
top economic headlines. Uh but take a look at this. This is how the market closed today. And this was um quite disappointing for investors and brokers there in New York. Uh so, the Dow fell 972 points today, about almost 2 and 1/2%. The S&P 500 falling about 2.3% and the Nasdaq composite fell about 2 and 1/2% as well.
All three major indexes coming off a week in the red as well. So, not a good Monday start for the market here. We do want to bring into the conversation right now our friend there, Jeffrey Roach. She's the chief economist at LPL Financial. He joins me. Um Jeffrey, good to see you here on this Monday.
Hope you had a good Easter weekend. I got to ask, though, can you attribute any one single thing or point why the market did so poorly today? Why was that? Well, I think in this case, it is somewhat obvious. The one catalyst, I think, for the sell-off was a continuation from the president calling for Chair Powell's removal.
Uh Jay Powell is the chairman of the Federal Open Market Committee, the committee that sets interest rates. And clearly, when there is a a risk to the independence between our central bank and the executive branch, markets will not like that. Okay, so I do want to get into that with you because we did a segment on Friday.
Jerome Powell was in the crosshairs of President Trump as well on Truth Social. So much so that Trump was essentially saying he's going to be gone soon. He's been demanding that Powell cut interest rates. He wants Powell to do that now. Let's see his latest kind of diatribe against Powell this morning.
I want to read it in full. He says this, "Preemptive cuts in quotations in interest rates are being called for by many. With energy costs way down, food prices, including Biden's egg disaster, substantially lower, and most other things trending down. There's virtually no inflation, Trump says. He says with these costs trending so nicely downward, just what I predicted they would do, there could almost be no inflation, but there can be a all caps slowing of the economy unless Mr.
Too Late, a major loser, lowers interest rates now. Europe has already lowered seven times. Powell has always been too late except when it came to the election period when he lowered in order to help sleepy Joe Biden, later Kamala, get elected. How did that work out? He asks rhetorically. You know, Jeffy, I have to ask, a lot of people online were essentially saying that then candidate Trump did not like that Jerome Powell cut interest rates in September, about 2 months before the presidential election, and it seems like Trump is still taking it out on Powell months later.
Is that how you read it? Well, there it's a complicated situation here. Clearly, there was terrible optics when the Fed, the committee, ended up doing what we call now a supersized cut, a 50 basis point or half percentage point cut in September, end of September 2024. Bad optics because the data didn't warrant that cut.
The inflation data was still running a little bit hot. Perhaps they were trying to play catch-up because they were holding rates steady for so long. So, it makes things a little bit complicated. Now, granted, when you think about where we are today, 2025, I think I'm not sure the logic behind this diatribe because markets have priced in the Fed cutting rates beginning in their June meeting.
They're going to meet in early May, probably not going to cut rates, but start telegraphing to investors that they will. So, even before this diatribe, markets have already anticipated, the Fed has already talked about and communicated the idea that the latter half of this year they will ease up. So, I'm not sure what benefit he gets out of this.
One thing I mentioned is a complicated situation. There is a phrase here in the Federal Reserve Act section 10 talks about the president having the ability to remove for cause. Now, granted, it's hard to to argue for the anything that would fit in that category of for cause removal. But, at this point I'm not sure there's much to gain with complaints about Chair Powell at this point.
Right. The for cause, to your point, maybe seems open to interpretation. But, I can't imagine any disagreements with the president would fall under the for cause clause here. You know, I wanted to ask this. Trump keeps citing the European Central Bank that they have lowered interest rates. He says several times here.
That's not a one-to-one comparison, is it? I mean, their inflation rate it's different than ours. Trump is saying inflation isn't there anymore. Is that right? It's not? Well, I don't know if we would want to compare ourselves to Europe really in any situation because you think about the potential growth rate of Europe is much lower than our potential growth rate in the United States.
Hence, that's the reason why the European Central Bank has indeed cut for a couple times. By the way, Germany has been in recession for 2 years. They had very, very sluggish economy for a long time unlike what we've seen over the last little bit where job market growth has been pretty decent, consumer spending has been strong.
So, I certainly wouldn't want to compare our economy with the European economy. So, if Jerome Powell said, "Okay, President Trump, I'll cut interest rates at next meeting." What would happen to inflation? Would it stay the same? Would it go up? Would it go down? I mean, does does President Trump know what he's asking for essentially from Powell?
Right. Well, it it it's no surprise that a president is trying to influence the chair of the committee. You know, this has happened for decades. In fact, there's a lot of uh history with the Clinton and Greenspan era. In fact, in the you know, early to mid-90s, the Greenspan Fed was raising rates. Clinton would have Greenspan come over for meetings and say, "Greenspan, stop raising." A little bit different, but but the same concept is there that you have you often have a president asking and begging for the Federal Reserve to be a little more accommodative, less tight.
Uh so, it's nothing new between uh Trump and Powell. Uh but I again, I think it goes back to the fact that the Fed has already communicated their plans to ease up on rates the latter half of this year. We get We just should be patient. All right, we will be patient. I mean, they haven't to your point cut or uh um risen rates this year at all.
So, we'll just have to wait and see. I do want to get your comments on this because still so many are talking about the the tariff uncertainty that was unleashed due to this this policy regime put in place and then put on pause by President Trump here. Um so much so that we can talk about the 10-year Treasury yield market um which is still acting a little funky.
But, Bloomberg had this reporting today that a White House official confirmed President Trump meeting with retailers later this afternoon to discuss tariffs. So, we're told that representatives from Walmart, Home Depot, Lowe's, and Target were going to be in the White House. Um if you could be a fly on the wall in that meeting, what would you expect to hear, Jeff?
Well, I think a lot of conversations about what actually what took place in 2022 and 2023 reshoring nearshoring remember the pandemic was all about the fact that that that clearly highlighted a lot of the vulnerabilities in supply chains. In some ways could say 2025 we actually might be in a lot better shape today than we were say during Trump 1.0 and tariffs.
The fact that these retailers have been fairly flexible in building in additional flexibility because of the pandemic. Now granted a tariff is is different than a pandemic but the same idea is still holds that when you have an increased tax here you as a retailer are going to want to be as flexible as possible to move supply chains around to other alternatives.
But case in point here the markets do not like tariffs. And we see that with the weaker dollar with gold rallying the uncertainty is really the thing that's that's the biggest catalyst for these sell-offs. And to your point the market also doesn't like a fight between the Fed chair and the president.
That's right. The markets want certainty clarity stability. These are the things that allow for for well functioning capital markets. Okay, Darren Jeffrey Roach we appreciate your time your insight and we'll definitely be speaking soon. Have a good night. Take care.
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