DFVL - Populism + Weakening Economy + Limited Central Bank Power To Ease + Elections = Risky Markets And Risky Economies
Recently, 1) the Fed wisely rolled back its plans to hike interest rates and to shrink its balance sheet and 2) Chinese negotiators made clear that they are willing to do a trade deal. These are good things that the markets reacted well to. At the same time, a) the wealth/opportunity gap is increasingly becoming manifest in b) increased populism of both the left and the right, which is leading to c) greater conflict both within and between countries and d) more extreme and worse decision making, which is especially risky when e) economic growth