Looking at the charts of both the Dow, SPY and the Russell, it looks like this continued sell off is extreme. As they said on the upside, this time is it different? Will it continue to sell of into the abyss?
The Powell statements are NOT encouraging. Half the work of the Fed Chief is managing its audience even if he is not accommodating the market. Although he expects two hikes in 2019, he says it is uncertain if it will be two or more and depends on the future data. They why say two for sure?! Perhaps say just don’t know.
He is becoming notorious to making off the cuff statements like the Tweeter-in-chief. This insensitive attitude can itself cause major systemic risks.
The capital markets are needed for funding – precipitious declines will make both stock issues and capital raising for small and medium companies exorbitant. And this will have its fallout on other credit and capital markets including private markets. So the Fed ignoring the market or making insensitive remarks are a dangerous thing.
Powell is neither Greenspan, nor Bernanke and not even Janet Yellen.