Wednesday's Markets Update (May 8, 2024)

08 May 2024 by rate3

On Wednesday, the stock market ended in a light green after a volatile day. Investors mulled mixed messages from officials and earnings reports. In world markets, the dollar strengthened on Fed comments, while the krona fell after Sweden's central bank cut interest rates. BTC turned red, edging to 61K, with ETH going under 3K, and the rest of major alts declining up to 5% (SOL, BCH).

World Markets

Spain's factory output dropped 1.2% in March compared to last year, reversing a small gain the previous month. Production fell in most sectors, including durable goods like cars and energy. This is the first decline in industrial activity in three months. (INE)
Brazil's retail sales in March 2024 were 5.70% higher than in March 2023, which is higher than the average annual growth of 3.24%. (Ibge)

Currencies

The dollar strengthened, reaching a one-week high. A hawkish Fed official signaled interest rates might stay elevated for a while, and investors are waiting for more clues on future rate changes.
The Swedish krona fell to 10.9 after Sweden's central bank cut interest rates (3.75%) to fight slowing economic growth. Inflation has dropped significantly since last year (4.1%), but the economy remains weak.

Comment: Self-Imposed Tyranny

Bloomberg interviewing Minneapolis Fed's Kashkari on the Milken Conference: "We are going to hold the rate until consumers adjust their behavior".

Translation: You have to do what I want you to do. Else? Inflation going bad? If that's a choice between the higher prices for eggs and your liberty? How sure you'll be?

Also, in the non-totalitarian, not centrally planned, not North Korean type economy, manufacturers will simply increase their production capacities (we are not living at the start of 20th century and we have more than enough of excess resources, not to mentioned an insane rise in productivity) and deliver cheaper and better products to our tables. Puff, inflation is gone. Unless of course Mr.Kashkari prefers Marks to Adam Smith.

Why do we still keep this atrocious, tyrannic, not elected institution - Fed - delegating our birth-rights to a couple of power hungry individuals dictating what we do with our money? Shall we allow them "to cool us down" (read "to make us poor") when they think it's appropriate?

Still, I suppose you'll hold your opinion while I will hold my to own.