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Thursday, 01 August 2019 09:08

Good Economic News Means Bad Market News

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(New York)

We are back in the weird world of the 2013-2016 era. Remember the time when weak/moderate economic news was great for stock prices? Welcome back. Investors are hoping that economic data trends flat or just a tiny bit weak, which would cause the Fed to loosen policy. However, if the economy does well, that would lead to tighter monetary conditions, which investors don’t favor. Therefore, right now, bad economic news is good for the market, and vice versa.


FINSUM: We have always found these kind of “goldilocks” scenarios rather perverse, but they are the reality nonetheless.

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