#1 spot: “Trump said he ‘hereby ordered’ U.S. companies doing business in China to explore relocating their operations… A1, A6”
#8 spot: “Powell gave his most forceful warning yet about the risks from escalating trade tensions and the limits to the Fed’s ability to cushion any fallout. A1”
#9 spot: “Google issued new guidelines limiting employee discussion of politics and other topics of not related to work, a major shift for the firm. A1”
Connect the dots…
If you’re not a WSJ reader, the bold “A1” reference in the quotes above lets you know that the article is on the front page of the WSJ that day.
On Friday, in addition to the tweet mentioned above, Trump tweeted some of his most aggressive attacks toward business related to China, and toward Fed Chair Powell in a tweet stating “’Who is our bigger enemy,’ Fed Chairman Powell or Chinese President Xi?”
Markets don’t like this tension between the Fed and the White House. It’s not good for the “animal spirits” that often move the market before the economic data justifies the market’s trend.
If Google has to try to control how that the current political environment is disrupting its employees’ productivity, it’s a pretty good bet that the “animal spirits” are going to weigh on the market more than the bulls would like to believe.
Friday’s market was a small example of what this can lead to.