Though in good conscience I’ll never admit it in public, I will say that I enjoy watching laugh-track sitcoms made in the 90s. As someone who prides themselves on being an individual who is somewhat culturally informed, it would make sense that I watch television shows which demonstrate my knowledge. Having said that, this couldn’t be further from the truth.
I watch quite a bit of television when I have the time, and there are times when all I want to do is turn on Friends and let my mind turn to mush. I’m not saying Friends is a bad show, but the creators of the sitcom included recorded laughter during moments where the audience, or viewer, was intended to laugh. What if I don’t find the moment funny? We’re supposed to have the option to react to content how we choose, not when we feel obligated to do so.
Watch whatever you please, but here’s what you missed in the news yesterday.
Will It Shutdown Again?
President Donald Trump promised that if Congress cannot come to an agreement and pass seven different spending bills by the end of this week, the government could go right back into a partial government shutdown. Rather than fear the shutdown, we must embrace the possibility and fully recognize why it is such a distinct possibility.
President Trump has demonstrated, on several occasions, his unwavering determination to secure funding to construct a wall along the US-Mexico border. He has said, time and time again, that our Southern border is more dangerous than an IHOP on a Sunday, and yet, his words have fallen on the deaf ears of the Democratic leadership.
For those of you just tuning in, Democrats and Republicans are split on how to handle immigrants attempting to unlawfully enter the United States. The Dems agree that we should protect American citizens from harmful individuals, but from a systemic standpoint, we need to create an easier path to citizenship for those who wish to come to America for a better quality of life. Republicans, many of which share the sentiment of President Trump, want to strengthen our borders, by any means necessary.
According to several sources, the latest disagreement erupting in Congress stems from how to best operate ICE detainment centers. Democrats insist that we cap the number of detention beds used for interior enforcement to curb ICE’s capacity to capture and detain undocumented immigrants, and Republicans are concerned with this logic.
Democratic Rep. Ilhan Omar, one of the first Muslim members of Congress, broke the first rule of political fight club; she made anti-Semitic comments. No, this isn’t the first rule that Congress members are taught, but one should assume not to exhibit bigotry in the public eye, or in general. Members of the Democratic leadership condemned Ilham’s recent comments made on Twitter that many consider to be anti-Semitic in nature.
“We are and always will be strong supporters of Israel in Congress because we understand that our support is based on shared valued and strategic interests. Legitimate criticism of Israel’s policies is protected by the values of free speech and democratic debate that the United States and Israel share…but Congresswoman Omar’s use of anti-Semitic tripes and prejudicial accusations about Israel’s supporters is deeply offensive. We condemn these remarks…”
–House Speaker Nancy Pelosi and other House Democrats
Fed Announces No Rate Cuts, But Sees A Cut In The Future
For the past couple of years, the United States Federal Reserve has been in the middle of a lot of speculation. The trade war between the United States and China has created a clamor for cuts in interest rates.
But on Wednesday, the Fed held the interest rates as they were. Furthermore, the Fed officially announced that no cuts in interest rates were forthcoming in 2019. It’s interesting to note that the markets are betting heavily on a forthcoming rate cut from the Fed. Some even expect the cuts to be formalized in July.
Rate Cut Ahead?
The Fed has ruled out the possibility of any cuts this year (allegedly). But many market watchers believe that a lot depends on how the market conditions evolve over the coming months. The uncertainty regarding the trade war with China is a major problem.
Yet experts believe that if it turns into a prolonged skirmish, then the Fed might reconsider its position. The United States President Donald Trump has led been campaigning for lower rates from the Fed for some time.
After having delivered his statement on Wednesday, the Chairman of the Federal Reserve Jerome Powell seemed to imply that rate cuts could not be completely out of the question in 2019.
“Many participants now see the case for a somewhat more accommodative policy has strengthened.”
The decision by the Fed was possibly one of the most-watched events in recent times. Long-term ramifications are the main concern.
Market participants had been calling for multiple cuts. But the Fed voted to keep benchmark rates within the 2.25% and 2.5% range. It was the range that had been back in December when the Fed had controversially raised the interest rates. The voted had been passed 9-1 in favor of holding the rate.
Trade Talks Fail, What’s Next For The Market?
The trade war between the United States and China has probably been the biggest economic and diplomatic development since the turn of the year. Although the world’s two biggest economies were locked in talks for months over a new trade deal, it all unraveled quickly.
This happened when US President Donald Trump stated that the Chinese went back on their word. He then imposed tariff hikes on Chinese goods last Friday. The tariffs were raised to an astonishing 25% on goods worth $200 billion. Although Trump might believe this might bully the Chinese into submission, many experts believe that might not be the case.
Difficulty in Completing Deal
The President had imposed these tariff hikes right before the Chinese delegation was supposed to show up at Washington. This was for which many had believed was going to be the last round of talks. However, experts now feel that the escalation of tensions between the two countries following the latest developments will make it difficult to reach a deal that could be considered a win for the US. As soon as the tariffs kicked in, Beijing announced that it was looking at countermeasures as well. However, there were no specifics on the nature of these measures.
Last year, the two nations had been embroiled in a damaging retaliatory tariff war and it could lead to a protracted trade war, if the Chinese decided to resort of the same tactics. The Chinese delegation is going to be in Washington this week to engage in another round of talks but it is believed that a binding trade deal is unlikely to be signed.
Is A Trump Win Likely?
One of the biggest reasons why the deal might not be signed anytime soon is perhaps the fact that the US President needs to be able to claim it as a win for himself. The President has staked his personal weight behind a favorable deal for the US. But with every passing day, it is looking increasingly unlikely that it is going to happen.
If that is to happen, then China’s entire way of doing business will need to change. This is starting at intellectual property theft and expands to technology transfers by force from US companies. If those things are not part of the deal, then it would not be the sort of deal that can be claimed as a win for the US. It doesn’t help that today, China came in with its own tariffs. China will raise tariffs on $60 billion in U.S. goods, the Chinese Finance Ministry said Monday.
And in true Trump fashion, the U.S. may not be done retaliating. The U.S. President has threatened to put 25% tariffs on $325 billion in Chinese goods that remain untaxed. The president has signaled he is content leaving the duties in place, arguing they will damage China more than the U.S. What are your thoughts?
Can 102 Words Really Impact Stock Prices?
In short, the answer is yes. We’ve witnessed, first hand, this week how just a few words can drastically impact the stock market. If you’re just tuning in, at the beginning of the first full week of May, U.S. President Donald Trump Tweeted out a 102-word post that ended up triggering a sell-off costing the global markets around $1.36 TRILLION…with a “T”!
The “Trump Tweet” expressed that he would once again increase tariffs on Chinese goods by the end of this week. What followed has been a shock to the global markets with futures pointing at dramatic declines every day this week. Though some say that the decline are all but a speed bump, it still hasn’t helped the fact that this drop is one of the worst seen all year. People like Kerry Craig of JPMorgan Asset Management think that a trade deal can still be reached. The expectations, however, have been readjusted to reflect a more long-term time horizon.
Eyes Turn Toward The Second Half Of The Week
Other analysts like Oanda Asia Pacific’s Jeffrey Halley feel that investors are prudently “lightening their loads.” Halley said, “My feeling is that investors are lightening their portfolios as a precaution.”
“Liu will be in the U.S. from May 9-10. The invite comes from both the U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin.” Regardless of what “will happen,” what has happened thus far has been an emotionally charged & very fragile global market. As this story develops we will continue to follow with more updates.
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