When risk-off continues, selling could be appropriate.
Market Needs to Prepare for The Worst
The President of the Federal Reserve Bank of St. Louis predicted that the US unemployment rate could hit 30% in the second quarter due to coronavirus shutdown, coupled with an unprecedented 50% drop in the US GDP. Not only is this situation worse than every prior war that the US has (officially) waged, but more than twice as dire as the worst days of the Great Depression.
Meanwhile, Bullard, one of the biggest Fed doves, said that the Fed is ready to do anything. Bullard called for a powerful fiscal response to replace the USD 2.5 trillion in lost income that quarter to ensure a strong eventual US recovery, adding that the Fed would be poised to do more to ensure markets function during a period of high volatility.
Bullard’s grave assessment “underscores the critical need for Congress and the White House to quickly find agreement on a massive aid program” especially after the Fed…
-120x86.jpg)
