Economy • Apr 21 20:25 • Modified on Apr 21 20:25 Another bloodbath on US stock markets, hundreds of billions up in smoke Author : BNR Web Editors
Investors are pulling their money out of US stock markets en masse, as uncertainty surrounding the trade war continues to persist. The major US indices are recording heavy losses, up to 3.6 percent. Since their peak in February, the major US stocks have lost more than 16 percent of their value.
Trump's continued attacks on Powell are fueling concerns about the independence of the US central bank.
While the stock exchanges in the Netherlands and Europe are largely closed for Easter Monday, this is certainly not the case in the United States. Indices Dow Jones, Nasdaq and the S&P 500 are losing between 3.1 and 3.6 percent of their share price at the time of writing. In total, more than 750 billion dollars has gone up in smoke in the most important American shares.
The uncertainty in the American stock markets is partly due to the attacks of the American president Donald Trump on Jerome Powell, the president of the central bank in the US. Trump has repeatedly increased the pressure on Powell, including by suggesting that he wants to fire him.
Powell's Resignation Trump reiterated his criticism of Powell, saying in a Truth Social post that the economy could slow unless interest rates are lowered immediately. That followed comments from a White House adviser on Friday that Trump and his team would explore firing Powell as an option.
Read also China has US in a stranglehold, rare metals export restrictions could harm US defense Trump’s continued attacks on Powell are adding to concerns about the independence of the US central bank. In principle, a president cannot fire the head of the Fed unless there is evidence of misconduct. If Trump were to go so far as to fire Powell over a policy disagreement, it would put further pressure on the US economy, while the trade war is already having a huge impact.
Unpredictability "The market doesn't like the Fed's independence being questioned," Joe Saluzzi, co-head of trading at Themis Trading, told Reuters. "The market can at least try to predict what an independent Fed will do. If their independence is questioned, then there can be more erratic (unpredictable) decisions. And the market doesn't like unpredictability."
