Alberto Poli @pino428: "𝙎𝙩𝙤𝙘𝙠 𝙈𝙖𝙧𝙠𝙚𝙩 𝘾𝙤𝙧𝙧𝙚𝙘𝙩𝙞𝙤𝙣 𝙖𝙣𝙙 𝙏𝙧𝙪𝙢𝙥'𝙨..."

Italy

𝙎𝙩𝙤𝙘𝙠 𝙈𝙖𝙧𝙠𝙚𝙩 𝘾𝙤𝙧𝙧𝙚𝙘𝙩𝙞𝙤𝙣 𝙖𝙣𝙙 𝙏𝙧𝙪𝙢𝙥'𝙨 𝙀𝙘𝙤𝙣𝙤𝙢𝙞𝙘 𝙋𝙤𝙡𝙞𝙘𝙮 In the early days of Trump’s presidency, the stock market entered a correction phase, with declines exceeding 10% within just a few sessions. However, drops of 5-10% are physiological events that regularly occur in financial markets and, in most cases, are quickly absorbed. The Nasdaq closed with a 7% decline since the beginning of the year, while the S&P 500 lost 5%. 𝙀𝙘𝙤𝙣𝙤𝙢𝙞𝙘 𝙐𝙣𝙘𝙚𝙧𝙩𝙖𝙞𝙣𝙩𝙮 𝙖𝙣𝙙 𝙏𝙧𝙪𝙢𝙥’𝙨 𝙋𝙤𝙡𝙞𝙘𝙞𝙚𝙨 The primary cause of this instability is the uncertainty generated by the aggressive economic policies of the Trump administration. After being a growth driver for the markets during the pre-election period, the new president is now becoming a destabilizing factor. His trade strategy is triggering a trade war that could slow global economic growth. By February 2025, economic growth had shown signs of slowing. The federal government ran a deficit of $ 307 billion in February 2025, increasing by 3.7% year-over-year, highlighting a structural problem in public finance management. The Trump administration needs substantial fiscal space to finance its economic policies, which include tax cuts and investments in strategic sectors such as technology and infrastructure. However, rising interest rates are complicating the situation: debt servicing costs already exceed the entire defense budget and represent one of the main concerns for the U.S. economy. Trump has openly expressed his hostility toward the Federal Reserve's monetary policy, particularly targeting Jerome Powell. His strategy may be aimed at weakening the markets to pressure the Fed into cutting interest rates, thereby facilitating public debt refinancing and supporting domestic consumption. 𝙈𝙖𝙧𝙠𝙚𝙩𝙨 𝙖𝙣𝙙 𝙄𝙣𝙫𝙚𝙨𝙩𝙢𝙚𝙣𝙩𝙨: 𝙏𝙝𝙚 𝙎𝙝𝙞𝙛𝙩 𝙏𝙤𝙬𝙖𝙧𝙙 𝙀𝙪𝙧𝙤𝙥𝙚 𝙖𝙣𝙙 𝘾𝙝𝙞𝙣𝙖 As American investors face uncertainty, many financial institutions are shifting their focus toward European and Chinese markets. The German DAX outperformed the S&P 500 in 2025, signaling a shift in global investor preferences. Europe, thanks to a more expansionary fiscal policy and increased spending on defense and infrastructure, is becoming an attractive alternative. 𝙄𝙣𝙛𝙡𝙖𝙩𝙞𝙤𝙣 𝙖𝙣𝙙 𝙈𝙤𝙣𝙚𝙩𝙖𝙧𝙮 𝙋𝙤𝙡𝙞𝙘𝙮: 𝙒𝙝𝙖𝙩 𝙩𝙤 𝙀𝙭𝙥𝙚𝙘𝙩 𝙛𝙧𝙤𝙢 𝙩𝙝𝙚 𝙁𝙚𝙙? On the macroeconomic front, inflation has shown signs of cooling: in February, the CPI rose by 0.2% month-over-month, below the 0.3% estimate. Annually, inflation fell to 2.8% (versus the expected 2.9%), while the core index (excluding energy and food) stood at 3.1%, the lowest level since 2021. However, some factors remain concerning: • Inflation expectations are rising: Americans anticipate inflation at 4.9% in the short term and 3.9% in the long term, the highest level since 1993. These figures give the Federal Reserve some room to cut rates, but the central bank remains cautious. The market is already pricing in 75 basis points of cuts by the end of 2025, but the new tariffs imposed by Trump could reignite inflationary pressures and complicate the Fed’s decisions. 𝙏𝙝𝙚 𝙍𝙞𝙨𝙠 𝙤𝙛 𝙖𝙣 𝙀𝙘𝙤𝙣𝙤𝙢𝙞𝙘 𝘾𝙧𝙞𝙨𝙞𝙨 𝙖𝙣𝙙 𝙏𝙧𝙪𝙢𝙥'𝙨 𝙎𝙩𝙧𝙖𝙩𝙚𝙜𝙮 Some analysts speculate that Trump is deliberately creating instability to force the Fed to cut rates, easing the burden of federal debt and reigniting economic growth. If this strategy fails and the market stops supporting him, the repercussions could be not only financial but also political. For now, the labor market remains resilient, with job openings rising to 7.74 million, exceeding expectations. However, consumer confidence is plummeting, reaching its lowest level in 29 months, with a 27.1% annual decline. This could lead to reduced consumption and slower economic growth in the coming months. 𝘾𝙤𝙣𝙘𝙡𝙪𝙨𝙞𝙤𝙣: 𝙒𝙝𝙖𝙩 𝙩𝙤 𝙀𝙭𝙥𝙚𝙘𝙩 𝙞𝙣 𝙩𝙝𝙚 𝘾𝙤𝙢𝙞𝙣𝙜 𝙈𝙤𝙣𝙩𝙝𝙨? Current market volatility reflects a transitional period for the U.S. economy. The uncertainty generated by Trump's policies, rising interest rates, and record deficits are pushing investors to reconsider their strategies. In the short term, the Federal Reserve will play a key role in determining market direction: if rates are cut, we could see a rebound in stocks and bonds. However, if trade tensions and fiscal issues continue to escalate, the market may face further turbulence. In this context, global investors are rebalancing their portfolios, reducing U.S. exposure and favoring Europe and China. If the EU continues to strengthen its economic policies and the dollar weakens, 2025 could mark the end of American exceptionalism and the beginning of a new growth cycle for European markets. Thank you for your support! $TLT (iShares 20+ Year Treasury Bond ETF ) $NSDQ100 $SPX500 $BTC

Not investment advice. The author may have financial interests in the mentioned instruments.