Fight inflation (hike rates)
Support employment (lower rates)
Today's data showing a less than expected 2.7% inflation rate, as well as the poor job numbers recently reported, gives the Fed the green light to lower rates at the next meeting and perhaps more after that.
Understandably, the S&Ps spiked higher regaining much of yesterday's sharp decline.
All things being equal, the mkt should hold these gains and perhaps push through yesterday's high. If it instead stalls out, that would be bearish action and I'd be looking to short it.
Then again, that may just be worth what you paid for it. ;-)
https://www.npr.org/2025/12/18/nx-s1-5647510/inflation-economy-prices-affordability
https://www.cnbc.com/2025/12/18/cpi-inflation-report-november-2025.html
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The stock market will especially like this because as joj stated, it gives them the green light to lower interest rates which makes interest bearing investment options less competitive with stocks, amongst other things.
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The impact of Trump's tariff's are inflationary for several reasons.
1. They impose an immediate tax by the ADDITIONAL AMOUNT of the tariff that US companies, then consumers pay for goods. This is indisputable.
2. There are also supply chain negative. Cutting off free trade agreements with trading partners will always reduce supplies in some markets. Always! Which ones depend on the unpredictable dynamics of individual dynamics. Free trade will always maximize US company and consumer access to global supplies of products.
3. Tariffs and the current leadership is long term negative to the relationships with our trading partners. Their impact imposes dynamics that become permanent when trading partners replace us with agreements from stable leaders that offer reliable terms they can trust .
4. Tariffs are costing jobs, not adding them. The additional costs, especially to smaller businesses cause less expansion and some contraction/cutting costs to make up for the higher costs of tariffs. The last thing that they do is incentivize countries overseas to move business to the US, which is currently being run by a madman that in the middle of the night could suddenly change the terms of any agreements with anybody about anything during another unhinged screed.
5. America's respect in much of the world is at an all time low since numbers have been tracking it.
6. Ronald Reagan was a strong advocate of FREE TRADE even though he did use tariffs SELECTIVELY(as an exception) based on a SMART, RATIONAL strategy to manage particular issues with particular countries that WERE EFFECTIVE. And don't believe the lies that try to mischaracterize his position. Reagan was also NOT A FAN OF DONALD TRUMP as Trump has stated on his Twilight Zone presidential plaques in the White House.
https://www.factcheck.org/2025/10/reagans-words-on-tariffs/
I see Mm is still suffering so what's new. Inflation is no where or down, take your pick. Job losses were by a good measure from our fed gov finally getting rid of 300,000 fake jobs from a bloating top heavy centralized socialist democrat gov, the fed shut down did hurt some 4th quarter numbers and finally had the fed not been led by a crazed lib who used politics not policy to rule things would even be brighter. And the best shocker of all with energy going the way its going among other things the first 1/2 of next year looks like a huge up term in most areas. Must be tough to have a guy living rent free inside your head but our economy is also showing more net take home pay to boot leading in '26. Ohh by the way how is that Epstein thing going? I see the latest horrific pics out
Trump were of him with some candidates at his queen contest but their faces were black out. All the while we find billions shipped to illegal Somalis and Minnesota pols led by the guy Kammala chose to be VP. Jesus, what a mess.