Dow plunges after Trump tells US firms to sever ties with China

Dow plunges after Trump tells US firms to sever ties with China


CHERYL: DURING THE COMMERCIAL BREAK, WANT TO LET YOU KNOW WE ARE COVERING THIS BREAKING NEWS ON THIS FRIDAY AFTERNOON SELLOFF. WE ARE GOING TO BLOW OUT OUR BREAKS. NO MORE COMMERCIALS. WE WILL TAKE YOU RIGHT TO THE CLOSE OF TRADING AT 4:00 P.M. EASTERN TIME. WE ARE JUST OFF OF SESSION LOWS MOMENTS AGO WHILE WE WERE IN OUR LAST COMMERCIAL THAT WE’RE TAKING. THE DOW IS DOWN MORE THAN 600 POINTS. S&P IS DOWN 71 AND CHANGE. THAT’S A LOSS OF NEARLY 2.5%. THE NASDAQ AGAIN, REALLY THE PRESSURE IS HEAVILY ON THE NASDAQ. A LOT OF THE TECH COMPANIES, THINK ABOUT APPLE, THINK ABOUT ALL THE CHIP MAKERS, CHINA IS THE STORY. THE PRESIDENT ORDERED, QUOTE, ORDERED U.S. COMPANIES TO ABANDON CHINA. THE FED CHAIRMAN JEROME POWELL SAID THE FED WOULD ACT APPROPRIATELY TO SUSTAIN THE ECONOMY. HE WARNED ABOUT GLOBAL GROWTH CONCERNS, HE WARNED ABOUT, YES, TRADE UNCERTAINTY THIS MORNING. HERE’S A LOOK AT THE FED FUNDS FUTURES RIGHT NOW. THIS IS THE BET, IF YOU WILL, TRADERS ARE MAKING, WHETHER OR NOT WE ARE GOING TO GET A RATE CUT. MAYBE IT’S A QUARTER POINT, MAYBE IT’S A HALF POINT. RIGHT NOW CHARNG RIGHT NOW CHANCG RIGHT NOW CHANCE OF A RATE CUT FOR THE SEPTEMBER MEETING, A QUARTER POINT, 100% CHANCE. 100% CHANCE WE WILL GET A CUT FOR THE SEPTEMBER MEETING. ALL OF THIS DEPENDS ON WHAT THE FED DECIDES TO DO. THEY ARE ALWAYS DATA DEPENDENT. WANT TO SHOW YOU THE YIELD CURVE. WE HAVE BEEN WATCHING THIS. THE INVERSION OF THE YIELD CURVE WHICH IS THE TWO AND TEN-YEAR, IF YOU SEE THIS HAPPENING AND HEAR THIS HAPPENING, IT MEANS THERE’S A FEELING IN THE BOND MARKET THAT THERE’S A RECESSION COMING. IT’S AN INDICATOR, IT’S A WARNING. IT’S NOT A GUARANTEE. BUT IT’S CERTAINLY SOMETHING YOU WANT TO KIND OF WATCH, OBVIOUSLY. LET’S BRING IN THE FORMER INTERNATIONAL MONETARY FUND CHIEF ECONOMIST MAURICE OXFELD LIVE FROM JACKSON HOLE, WYOMING. WE ALSO HAVE ANDY BRENNER. GENTLEMEN, GREAT TO HAVE YOU BOTH HERE. MAURICE, YOU’RE ON THE GROUND. I DO WANT TO ASK YOU, HOW WERE THE PRESIDENT’S TWEETS, IN PARTICULAR THE LAST ONE, AIMED DIRECTLY AT JAY POWELL, SAYING HE’S AN ENEMY OF THE COUNTRY, THE MARKET, HOW IS THAT PERCEIVED THERE?>>WELL, YOU KNOW, I CAN GIVE YOU MY REACTION. THERE ARE A NUMBER OF ISSUES IN THE WORLD ECONOMY NOW BUT THE BIGGEST FACTOR DEPRESSING GROWTH EVERYWHERE IS THE PRESIDENT’S TRADE WAR. I THINK THE PRESIDENT IS EAGER TO JUICE THE ECONOMY GOING INTO THE ELECTION. THE TRADE WAR IS WORKING IN THE OTHER DIRECTION SO HE’S LINING UP A RANGE OF SCAPEGOATS INCLUDING THE FED MOST PROMINENTLY BUT ALSO CHINA, EUROPE, YOU IN THE MEDIA. CHERYL: YEAH. WELL, WE HAVE A LOT TO COVER, OBVIOUSLY, AND THE CHINESE CERTAINLY TOOK A HUGE SWIPE AT THE UNITED STATES THIS MORNING, BUT JAY POWELL’S IN A TOUGH SPOT HERE. HE’S GOT CRITICISM COMING FROM THE PRESIDENT. THAT’S ONE THING HE’S GOT TO DEAL WITH. ALSO, HE’S GOT TO MAKE THIS A DATA-DEPENDENT CUT IN THE MEETING IN SEPTEMBER. WHAT I THOUGHT WAS INTERESTING, HERE’S THE QUOTE, THERE ARE HOWEVER NO RECENT PRECEDENTS TO GUIDE ANY POLICY RESPONSE TO THE CURRENT SITUATION. WHAT DO YOU MAKE OF THAT PARTICULAR LINE FROM POWELL THIS MORNING?>>WELL, WE HAVE NEVER HAD THIS KIND OF SITUATION BEFORE WHERE TRADE IS SO PROMINENTLY AFFECTING THE GLOBAL, THE WORLD’S ECONOMIES. I THINK, THOUGH, THAT THIS KIND OF HELPED POWELL TODAY BECAUSE HE’S ALREADY SAID HE’S LOOKING TO DO WHAT IS APPROPRIATE AND HE’S AWARE OF SIGNIFICANT RISKS ON THE HORIZON, YET HE’S GOT ALL KINDS OF FED BANK GOVERNORS WHO HAVE SAID THEY DON’T WANT TO EASE AT ALL. NOW ALL OF A SUDDEN, YOU’VE GOT STOCKS DOWN 600 POINTS, S&P DOWN 71, REAL FEAR OUT THERE BECAUSE OF WHAT CHINA DID THIS MORNING. WE THINK CHINA WAS TRYING TO SEND THE PRESIDENT A MESSAGE GOING INTO THE G7, BUT IT’S HAD MORE OF AN EFFECT THAN THAT AND IT’S ACTUALLY HELPED POWELL BECAUSE I THINK IT’S GOING TO ENABLE HIM TO GET THE FED GOVERNORS WHO REALLY DO NOT WANT TO EASE AT ALL, GET THEM IN SYNC FOR A 25 BASIS POINT CUT IN NOVEMBER. CHERYL: SIMILAR COMMENTS FROM NEIL KASHKARI EARLIER THIS WEEK. THAT KIND OF MOVES THE NEEDLE FORWARD FOR A BIGGER RATE CUT. HOW LIKELY IS IT WE GET A HALF A POINT? I ASK YOU THAT, I THINK THE NUMBERS MATTER, BECAUSE AT SOME POINT THE BANK’S NOT GOING TO LEAVE ITSELF ENOUGH ROOM IN CASE WE HAVE A REAL GLOBAL RECESSION AND THERE IS TALK ABOUT THESE CENTRAL BANKS AROUND THE WORLD MAKING THESE STEEP CUTS. YOU HAVE NEGATIVE RATES IN EUROPE. YOU CAN ONLY GO SO FAR.>>YEAH. I THINK THAT ENCAPSULATES THE CONFLICT WITHIN THE FEDERAL OPEN MARKET COMMITTEE. THERE ARE THOSE WHO WOULD LIKE A STRONG PREEMPTIVE CUT TO AVOID GETTING TOO CLOSE TO THE ZERO INTEREST RATE POINT. THERE ARE OTHERS WHO WOULD PREFER TO WAIT UNTIL THEY SEE THE WHITES OF A SLOWDOWN’S EYES. CHAIR POWELL AND HIS SPEECH, HE REFERRED TO A NUMBER OF RISK FACTORS THEY ARE MONITORING. THE CLOSELY RELATED FACTORS OF MUTED INFLATION, TRADE WAR AND SLOW GLOBAL GROWTH AND ALSO REFERRED TO RISK MANAGEMENT BY THE FED. I THINK HE’S LEAVING THE DOOR WIDE OPEN TO MORE CUTS THIS YEAR, PERHAPS A FRONT-LOADED CUT IN SEPTEMBER, AND CERTAINLY IF THE KIND OF TURBULENCE WE ARE SEEING TODAY CONTINUES, WE WILL SEE IT IN THE ECONOMIC NUMBERS AND THAT WILL JUSTIFY SOMETHING AGGRESSIVE. CHERYL: WE ARE GOING TO BE GETTING A REVISION ON Q2 GDP, THAT WILL ACTUALLY BE NEXT WEEK, NEXT THURSDAY, I BELIEVE. IF WE SEE MORE PRESSURE ON GROWTH, AND AGAIN, IF YOU SEE EMPLOYMENT AND INFLATION WHICH OF COURSE ARE THE FED’S ACTUAL MANDATES, NOT REACTING TO POLITICS OR TRADE, THAT COULD REALLY BE A GAME CHANGER, NOT JUST FOR THE COMMITTEE BUT FOR THE MARKETS.>>YEAH. THE WAY I SEE IT IS THERE’S NO RECESSION ON THE HORIZON FOR THE U.S. ECONOMY. CONSUMER GROWTH CONTINUES TO BE VERY STRONG. IT’S 70% OF GDP SO WE’RE NOT GOING INTO A RECESSION. EUROPE, ON THE OTHER HAND, IS ALREADY IN CRISIS AND WITH THESE TWEETS TODAY GOING BACK AND FORTH, I’M JUST AFRAID ABOUT WHAT THE ECB IS GOING TO DO ON SEPTEMBER 12th AND WHAT WE MAY DO TO FOLLOW THEM ON SEPTEMBER 18th. IT COULD REALLY BE AN UGLY SEPTEMBER. CHERYL: YOU KNOW WHAT, MAURICE, HE BRINGS UP A REALLY GOOD POINT. G7 IS THIS WEEKEND. THE PRESIDENT IS GETTING ON A PLANE ABOUT 10:00 P.M. EASTERN TIME HEADING OVER THERE. THIS IS GOING TO MAKE FOR AN INTERESTING 48 HOURS. IT COULD BE REALLY A CRITICAL 48 HOURS FOR THE MARKETS, NOT JUST WHAT’S HAPPENING IN THE G7 BUT ALSO WHAT’S HAPPENING IN HONG KONG. WE ARE NOW AT 11 STRAIGHT WEEKS OF PROTESTS THERE.>>WELL, LOOK, THERE’S HONG KONG, THERE’S THE POSSIBILITY OF A NO-DEAL BREXIT AND THAT WILL BE SOMETHING DISCUSSED AT THE G7. THERE’S THE TRADE CONFLICT PEOPLE AREN’T FOCUSING ON BETWEEN KOREA AND JAPAN WHICH IS REGIONALLY QUITE IMPORTANT. THERE’S A LOT IN THE MIX HERE. AND YOU KNOW, THESE G20, G7 MEETINGS HAVE BEEN FEATURING A LOT OF DISCORD IN THE PAST. LOOK, WE KIND OF HAVE FOCUSED ON CHINA HERE IN TERMS OF THE TRADE CONFLICT BUT DON’T FORGET, THE PRESIDENT HAS THREATENED OTHER TARIFFS ON EUROPEAN CARS. SO THAT COULD COME UP ALSO. I THINK IT WOULD ADD TO THE KIND OF TERROR WE ARE SEEING OUT IN THE MARKET. CHERYL: MAURICE, YOU LOOK NICE AND RELAXED.

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About the Author: Oren Garnes

100 Comments

  1. Thx again Peter! You think just like I do and you watch all the crap I should all day but don't lol thank you for doing it for me.

  2. Temporary setback, get ready for the COMEBACK!!! Keep pushing our line President Trump. Our economy will soar from the changes you're making after China and Russia are subjugated to U.S. interests and immigration is brought to heel.

  3. The US companies have been ripping off the Chinese workers. They pay them very low wages. It is time for China to act and rectify this situation.

  4. Federal Reserve is a privately owned business (Rothchild controlled) that controls our government (and many others)…they caused the US to declare bankruptcy during FDR's presidency….that bankruptcy is why we pay social security taxes, it was FDR's selling our future and our children to the central banks.

  5. Don't cave into the Chinese and let's fight this fight, it's LONG, LONG OVERDUE. Thank you, President Trump and your brilliant leadership of our nation. MAGA KAG in 2020.

  6. AMERICANS…fix your Trumpy Dumpy problem ….before some others in this world do it for you

  7. Godspeed President Trump. Thank you for standing up to Communist China. America should not do business with communist China that does not give their citizens basic human rights. America should never be dependent on a communist country that is in competition with America to be the world’s super power. America must be self sufficient and not rely on any other country to prosper.

  8. It's about time someone was bold enough to take this action. There is no honor in propping up a totalitarian regime such a China by buying their goods while they steal our intellectual property and undermine our republic. Will it cost the average American something? Yes it will, but it will cost more to continue business as usual with them. It's time to bite the bullet and take the bull by the horns.

  9. It plunged, eh? Really, now, so dramatic. It dipped and is still at stellar heights. FOX needs an enema because they're full of shite.

  10. United States has no worries the market will always self correct and we will bring back business from China into United States starting a whole new industry ultimately the United States will be a new superpower if we cut ties with China and do the exporting not importing anymore

  11. The federal reserve is the largest enemy the United States has . There is nothing federal about it , it is a cartel of private banks that are systematically removing the wealth from the United States .

  12. Hey! My order from Chin a is n o t her2 yet! Ill gladly give up 300 less for the good of our country.
    Well…
    Ok. If thats what it tajes.

  13. DOW PLUNGES. Who gives a crap. LET IT. The ups and downs of the market are controlled by corrupt, greedy, fear-based investors and stock holders who have no CLUE about what Trump is doing. The ONLY thing that matters is what Trump is doing with China. He's trying to block them from taking over as the world's only economic superpower. They won't get there now, but it's because of Trump, and his full frontal assault on President Xi. China is the largest and most dangerous communist dictatorship in the world and they've built their evil empire on OUR money and OUR intellectual property! Trump is taking power back from China and restoring it to AMERICA. It won't be easy, the market will go up and down like it always does – but blocking Chinese dominance is a MUST DO! Take the sacrifices and stand with our President. He's doing this for America's future! The Founding Fathers are watching. Are we willing to fight for America with Trump? Or are we going to whine about losing a few conveniences and roll over for China like a poodle? Remember 1776. What sacrifice for this country did our forefathers make? Let's stand with Trump now, so we don't have to take up arms to defend ourselves later!

  14. You want minimum wage, benefits and you still think you can compete with China. I can't afford to buy cheap clothes now for $100s.

  15. Sad that the fat orange faced fool has access to the nuclear codes as well. Time for the traitor and idiot to RESIGN!

  16. Nothing like having a guy with the biggest string of bankruptcies in history lead America into becoming a s-hole country. The fact he's a confessed child molester should help. Brilliant.

  17. Trump is right to tell companies to leave China
    China is at war with the world economically.
    Now is the only time left to do this.
    Diversify your supply chain.

  18. Trump is the master! Wow, he's pushing the FED into a corner so they have no other options but to drop rates 🏆🇺🇲

  19. And that will be the end of Walmart’s, Amazon or anybody left except Monsanto who sells the poisons
    For Population Reductions.

    Note how many folks are walking around looking like 🐷s these days.
    That why they need guns, to keep from being eaten themselves

  20. It’s about time boycotting China’s products! China never change thief mentality, never trying to civilized.
    America must live without Chinese products!.

  21. Trump unpredictability especially on trade war with China that causing stock market around the world a series of continuous roller coaster rides!

    Does anyone doubt or even check whether Trump & his cronies make any money out of it?

  22. I care about the stock market the same way i care about China. When you put your money in the stock market it is a chance you take. When you move your factory to China it is the chance you take.

  23. Fair trade or no trade with China.. I prefer no trade but if they will come to the table under our terms ok..We can not be reliable on the communist chinese … Being self sufficient is a good thing..No its a great thing.

  24. Awesome, keep selling so we can buy in and make More $. Now is the time to BUY STOCKS. Do not walk away keep ur money in and pull from ur savings & Buy what you can!!!

  25. Recession isn't happening yet sorry Dems. We have our cups to drink your Tears.
    We will see the Dow hit 28,000. It will be going up.
    look at Firearm Stocks big time. Tech, pharma, Comm are a win if u can get em lower.

  26. We don't need China. China needs us! bring back manufacturing back in America. Tired of getting cheap crap from China?

  27. We need our companies bring back Ford motor should bring back brookpark casting plant and we should start telling these college kids they have these high student loans that they have to go and do these jobs to pay off those student loans

  28. i thought trump's claim was that corporations were already allegedly going to come pouring back to the u s after he was elected. surprise…another lie. while he's pressuring other companies to sever ties with china, just make sure his companies do the same.

  29. Its about time, bring back all are companys make everything in the US Good for american citizens and are country

  30. Dictator Trump is now pushing communism – the state ccontrolled economy.

    And his idiot Deplorables are enabling him right off a cliff.

    Sad.

  31. Balls of steel. I back the president. We need to stand up to the Chinese. We'll be much better off in the long run.

  32. After Donald Trump is done believing he's winning his trade wars, will the US have anywhere to sell its products?

  33. Ain't nuthin' compared to America's $$$$$ Billions in losses over the past decades = due to previous presidents' foolish trade deals. More than ever I support President Trump. He takes these trade deals HEAD ON…… C'mon, FOX News, tell the story within its proper context.

  34. What Trump said, was a recommendation at it's strongest. It was NOT an order. Man, this media is so full of BS it's incredible.

  35. The Chinese trade which was immensely imbalanced against the US can simply not continue , trade has to be fair to all parties. They have poached industries from all over the world. It has been advantages only to the Chinese and if they were an honest nation the would openly declare this to be true ,not that this is likely to Happen.
    So where are we at now ….. well luckily President Trump is at the helm and he is NOT a pushover for the Chinese
    I am sure that as time allows to pass the Chinese will see the error of their ways and will come to realise that fair negotiating will be advantages to both China and the US ,they must talk and come to a fair agreement soon

  36. The DOW Jones, down 600 points because trump tweeted, WOW SO MUCH WINNING how much more can we take please mr president one term is all the country can take .

  37. People will say we need the cheap stuff china makes to save money, but the cheap stuff breaks quickly and you have to buy the cheap stuff again. Where is the saving if you have to keep buying the cheap stuff when for the amount of money for all the cheap stuff you could have purchased a quality item which will last much longer without breaking.

  38. This just shows how stupid Trump and his supporters actually are. Trump is acting like a dictator, and should be immediately removed from office.

  39. just a temporary reaction… hold on to your stock….. will benefit in a long run…. DO NOT SELL… Stock with your US stocks….. I am…. just like millions of American investors…

  40. President Trump was asked about the 600 point drop last night before he left. He stated "The stock market is up over 25 points don't ask me about 600 ". If he is not worried he who is responsible mainly for the huge increase, then why are people making such a big deal out of it. Markets go up and down all the time.

  41. The states can handle this "war". China cannot. The only reason they are willing to fight this is bc they are hoping trump loses in 2020. China needs the state's to stay a world power the likes of Russia and America.

  42. Chinese companies have been moving production out of China in favour of cheap labour markets in Vietnam, Thailand, Myanmar, etc for years. So we should do the same.

  43. the globalist press and its foreign sponsors want to lose the Trade war. they think Trump will fold fast. Wrong! Not this time. No pain no gain.

  44. Trump is right. This country has been dependent on foreign countries for far too long. And it’s killing us.

  45. I agree with Trump, U.S. firms in China should re-locate to other Developing Countries in Asia like India,Vietnam,Philippines, Malaysia,Indonesia,Laos,Cambodia,Thailand.

  46. Well, over here in Far Far West Texas we decided not to go to the recession party you people who do not like our president are trying to throw. We are doing pretty well and are planning for a great future. Thanks but no thanks to your next plan to remove our President.

  47. It amazes me how so many are advocating selling out to China !?!?! It is like supporting the destruction of the U.S. All in the name of profit, to hell with the middle class. Crazy times we live in.

  48. Will American Companies listen to President Trump? I remember back in the 1980's when I was still working when American Mfg. Companies went to Countries like China and India etc., because of cheap labor.

  49. Companies need to come home to give Americans JOBS again ! Not Walmart Jobs ! And Not fast food jobs ! REAL jobs for Adults !

  50. Hillary is running in November because no democrat candidate excites anybody and can’t raise the money to defeat Trump. Hillary raised 2 billion dollars last election and still lost. She actually got more votes than Trump so she’s gonna be the nominee… Trump 2020🇺🇸

  51. The Dow was in the high teens when Trump became president. Now it's just south of 26,000. There's no need to get hysterical over 600 points.

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