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Yahoo
22-05-2025
- Business
- Yahoo
Here's How Kevin O'Leary Is Investing During Tariff Turbulence: Should You Do the Same?
Keeping up with tariffs has been a little bit like watching a tennis match — they go from one side to another almost daily. It can be challenging for an investor to keep up. At times like this, it can pay to listen to an experienced investor, like 'Shark Tank's' Kevin O'Leary, and follow their lead. Be Aware: Find Out: Here's how O'Leary in investing during the tariff turbulence and whether you should do the same. One of the biggest risks of the tariffs the Trump administration has proposed is that they will raise prices, which could lead to a recession. Federal Reserve Board of Governors Chairman Jerome Powell recently said while the Fed does not predict recessions, there is typically a one in four chance of recessions within 12 months at any given time. O'Leary gave his insight on the likelihood of a recession in a recent interview with CNN's John Berman. 'Let me just say that we've been talking about recession now for four years in a row, you may recall. Forecasters of recessions have been wrong for four years straight. … We're not in a recession right now.' O'Leary added that he is not currently investing as he would in a recession, since there is no recession at the moment. Read Next: O'Leary explained that, while tariffs make for 'a difficult, tricky situation,' market corrections are commonplace. 'The markets correct 20% all the time, almost every 18 months. … This is nothing new for the S&P 500,' he said, adding that these corrections are often buying opportunities. 'It's a value deal.' Professional investors commonly recommend 'buying the dip,' or investing during a downturn, as there are bargains to be had when stock prices fall. The volatility in the markets is a byproduct of the administration's tariff policies, according to O'Leary. 'There's a lot of volatility and that's what you get when you take these kinds of actions,' he said. 'No administration has ever taken on 60 trade negotiations simultaneously, let alone China on top of that.' O'Leary is well known for his long-term approach to investing, and nothing in his comments about tariffs or recession would indicate he's deviating from that. In his book, 'Cold Hard Truth on Men, Women, and Money,' he recommends the individual investor pare down spending to invest as much as possible into a 401(k) or other retirement account. By looking at your income and expenses over a 90-day period, you can see how much money you have to invest. If you want to invest more, you need to trim back your expenses. O'Leary recommends sticking to this approach and not worrying about a possible future recession. 'I would argue right now that people that count out the American economy are constantly wrong all the time.' Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates 6 Big Shakeups Coming to Social Security in 2025 Sources CNN, 'Harvard Sues Trump Admin Over Threats to Cut Funding; U.S. Markets Look to Rebound After Selloff; Nearly Half of U.S. Teens Say Social Media Hurts Their Generation.' YouTube, CNBC Television, 'Powell on the possibility of a recession.' This article originally appeared on Here's How Kevin O'Leary Is Investing During Tariff Turbulence: Should You Do the Same?
Irish Independent
12-05-2025
- Business
- Irish Independent
The week ahead in business: fintech summit, eurozone GDP and online safety panel
Organised around the theme of 'Trade, Technology, and Policy: The Changing Dynamics of Growth,' it will look at the challenges facing the US and EU economies. Speakers include Adriana Kugler, a member of the Federal Reserve Board of Governors. The annual one-day National Fintech Summit will be staged at Croke Park tomorrow. It's billed as a platform for players in the Irish fintech sector to network and collaborate. Attendees will include banks, start-ups, SMEs and policymakers, and they will take part in discussions about EU regulations, tech transformation, open banking, global fintech trends and, inevitably, AI. On Wednesday, the Institute of International and European Affairs (IIEA) will host a panel discussion on the Digital Services Act, which is an EU regulation that aims to protect people online by pushing platforms to address harmful content. This event is being held in collaboration with the Economic Regulators Network and speakers will include John Evans, the Digital Services Commissioner with the Irish media regulator Coimisiún na Meán. Members of Financial Services Ireland will convene on Friday at the Alex Hotel in Dublin for their annual lunch. Finance Minister Paschal Donohoe will deliver the keynote address at the event. On the same day, Enterprise Ireland will host a semiconductor meet-up for people from the industry, with the aim of offering a platform for discussions on innovation and collaboration in their line of work. This week the Central Statistics Office (CSO) will announce Ireland's trade balance for the month of March, showing the level of goods exported and imported. There was a huge spike in exports in the first two months of the year, due to US importers stocking up their warehouses as a precaution against US president Donald Trump's tariffs. That trend probably continued into March. On Thursday, Eurostat will release an initial estimate of the eurozone's economic growth for the first quarter of the year. It will also provide an Industrial Production report for March, looking at the performance of factories, mines and utilities, which might give us an insight into how much all the recent global uncertainty has affected the euro area. There will be results on Tuesday from DCC, the leading Irish international sales, marketing and support services group which is listed in London but has its headquarters in Dublin.
Yahoo
07-05-2025
- Business
- Yahoo
Jerome Powell keeps interest rates the same — and ignores Trump
On Wednesday, Federal Reserve Chairman announced that he would keep interest rates the same, despite overtures from President Donald Trump. Trump has repeatedly called for Powell to lower interest rates as he seeks to tilt the global economy in the United States' favor by levvying across-the-board tariffs against adversaries like China and allies like Canada, Mexico and Europe. Powell, whom Trump nominated to lead the country's central bank, remained firm that the Federal Reserve would remain apolitical. 'It doesn't affect our doing our job at all,' Powell said in response to a question about Trump's calls to cut rates. 'We're always going to consider only the economic data, the outlook, the balance of risks, and that's it. That's all we're going to consider.' Federal Reserve Chairman Jerome Powell announced he would keep interest rates the same (Getty Images) In his remarks and press conference afterward, Powell made it clear that the tariffs could risk higher inflation and unemployment. That would pit the Federal Reserve's two mandates — keeping inflation and unemployment low — in direct conflict with each other. ADVERTISEMENT 'And if that's what we do see, if the tariffs are ultimately put in place at those levels, which we don't know, then ... we won't see further progress toward our goals, but we might see a delay in that,' Powell said. At the same time, Powell, a Republican who worked in George H.W. Bush's administration and had a distinguished career in finance, shied away from partisanship, given the fact the Federal Reserve is supposed to remain apolitical. Powell's term as chairman ends a year from now, but his position on the Federal Reserve Board of Governors expires in 2028. But he demurred when asked if he would stay on board. 'I don't have anything for you on that,' Powell said. 'We want to make the best decisions for the people that we serve. That's what we think about day and night.' In recent weeks, Trump hinted that he wanted to fire Powell – and then, when markets reacted negatively, insisted he had 'no intention' of doing so. ADVERTISEMENT Again, Powell dodged political territory. 'I don't have anything more for you on that,' he said. 'I've pretty much covered that issue.' He also dodged when asked about the fact he has yet to meet with Trump since the president's return to office. 'I've never asked for a meeting with any president, and I never will,' Powell said. 'I think it's always come the other way. A president wants to meet with you, but that hasn't happened.' While the Federal Reserve is dedicated to to keeping prices and unemployment low, Powell himself seems to have an additional dual mandate personally: to navigate the joint challenges of the dangers Trump's tariffs pose to the US economy while also avoiding discussing politics. Ostensibly, the US government has numerous branches that are supposed to remain devoid of political influence. But Trump has targeted many of them, firing two Democratic commissioners on the Federal Trade Commission; significantly weakening the Consumer Financial Protection Bureau, which is funded by the Federal Reserve; and flouting rulings from the courts in regards to controversially sending immigrant Kilmar Abrego Garcia to an El Salvador prison on suspicion of being a gang member but without having been charged with a crime. ADVERTISEMENT Powell, and the Federal Reserve as a whole, is different. Trump often expressed dissatisfaction with Powell during his first term, but Powell earned high praise for his management during the COVID-19 pandemic. Powell's management led to Trump's Democratic successor Joe Biden renominating him for another five-year term. As a result, Powell is not necessarily 'standing up' to Trump as much as he is doing what central bankers always do: canceling out the politics and focusing on the data. But doing so is much harder in the Trump era when the president sees almost every institution as something he wants to personally control. Ironically, this week, Trump faced steadfast opposition from Canadian Prime Minister Mark Carney on Tuesday when the newly-elected Carney visited the Oval Office. Despite Trump's insistence on adding Canada to the United States, Carney told Trump 'as you know from real estate, there are some places that are never for sale.' Incidentally, Carney and Powell know each other from when Carney ran the Bank of England. Perhaps the key to ignoring Trump's bullying may come not from bluster on one's own behalf, but from having the traits of an academic and unassuming central banker and financier.
Forbes
04-05-2025
- Business
- Forbes
Kevin Warsh Is Viewed As A Future ‘Adult' At The Fed. That's Dangerous
WASHINGTON, DC - APRIL 18: Jon Hilsenrath, Author, chats with Adam Posen, President, Peterson ... More Institute, Kevin Warsh, Former Member, Federal Reserve Board of Governors; and Karen Karniol-Tambour, Co-CIO, Bridgewater at The Semafor 2024 World Economy Summit on April 18, 2024 in Washington, DC. (Photo byfor Semafor) High prices beget low prices. It's the high prices that summon more supply, more innovative production processes that ultimately result in lower prices, and often both. That high prices foretell lower prices rates more discussion as Republicans and conservatives rush to anoint former Fed Governor Kevin Warsh as the next Fed Chairman. They seemingly view Warsh as another 'adult' with whom they have history with in the Trump economic room, while Warsh likely fits Trump's preference for good-looking people. Ok, but what about Warsh the economic theorist? This is the real danger associated with Warsh that happy-talking conservatives don't seem willing to acknowledge, or grasp. Warsh is an interventionist by his own admission. He still defends his former Fed boss Ben Bernanke's 'try everything' response to financial uncertainty in 2008. Warsh also defends the Fed's 'quantitative easing' efforts in 2008-2009 meant to push down interest rates. If we forget for a moment that the Fed can't alter reality opposite Bernanke and others who buy into (and practiced) central-banking mysticism, stop and think about what it signals about Warsh that he thinks otherwise: it's a sign that he's fully willing to substitute himself for the information-pregnant marketplace when it's sending crucial signals. Lest readers forget, prices are how the market economy organizes itself, yet Warsh thinks it's alright for government officials to intervene when market prices are communicating what they don't like. Here lies the danger of 'adults' like Warsh, and arguably 'free market' Republicans more broadly. Just as hardline anti-communist hardliner Richard Nixon could go to China, Republicans can meddle with markets. That's the stuff of crises. More on this in a bit. For now, it's useful to contemplate the speech Warsh gave last week and that had conservatives rapturous. In one editorial Warsh was lionized for observing that the Fed 'has undermined its own credibility in recent years by failing to fulfill its core duty of providing price stability.' Really? Market prices, much like credit prices, are an effect of wildly sophisticated cooperation among man and machine (we don't borrow money, we buy what money can be exchanged for) around the world, and the infinite prices of either could never, ever be managed or overseen by central bankers. From there, Warsh promoted the fiction that the quantitative easing he initially supported ultimately 'disguised the true cost of capital,' and the latter allegedly 'subsidized government deficit spending by keeping the cost of borrowing artificially low.' No, that's not serious. Just the same, it's remarkable the veiled disdain conservatives have for the market signals they claim to embrace. Seriously, do they really believe the deepest markets in the world in which are traded the most owned assets in the world (Treasuries) were really tricked by men and women with last names like Bernanke, Yellen, and Powell on the way to much easier borrowing than would have taken place if markets hadn't been duped? Hopefully the question answers itself. Contra Warsh, the danger isn't that the Fed can trick markets and control credit prices (what a laugh), it's Warsh himself. It's that conservatives view him as their adult in the room. Except that Warsh joined with other adults in 2008 to intervene in a healthy correction, one that logically included financial institution failure, and that if left alone would have taken place absent what some who should know better claim to this day was a 'financial crisis.' No, no such thing. Markets just are. They're a mirror. The only crisis is one of intervention, and the adult in Warsh situationally embraces intervention. Which is the stuff of crises by its very name.
Yahoo
22-04-2025
- Business
- Yahoo
Trump Rages at the Fed Over Interest Rates
President Donald Trump is not happy with Federal Reserve Chair Jerome Powell. Airing his grievances over the weekend on Truth Social, the president complained that interest rates have not been lowered recently and accused the Fed, led by Powell, of lowering interest rates before the election "in order to help" Kamala Harris "get elected." In the financial community, it's kind of an open secret that the Fed was politically motivated to ease monetary policy. Christopher Waller, a member of the Federal Reserve Board of Governors, laid the groundwork for the cuts in a speech in December 2023, and all that was needed was a short run of soft economic data to pull the trigger on the rate cuts, which began with a half percentage point cut followed by two quarter-point cuts. Lowering the interest rate had the desired effect—fluffing up the stock market before the election—but the thumb on the scale was not enough to tip the election in Harris' favor. Politics often influences monetary policy decisions, despite the Fed's nominal independence. It should also be noted that the stock market is experiencing volatility comparable to what happened during the pandemic, when interest rates were cut to zero and the Fed engaged in quantitative easing. During this crisis, there is so far no hint of easier monetary policy, though it is needed. When it comes to monetary policy issues, Trump is a doppelganger of Turkey's president, Recep Tayyip Erdoğan, who has repeatedly lowered rates in the face of rising inflation, leading to a currency crisis, devaluing the lira, and potentially triggering hyperinflation. If Trump were left in charge of monetary policy, we would eventually end up like Turkey. Worryingly, some prominent intellectuals actually want Trump in charge of monetary policy. If we are to have a central bank, it should be independent. Libertarians rightly argue that we should not have a central bank, that 19 unelected bureaucrats with all their political motivations should not be in charge of the most important price in the economy—the risk-free rate of interest. "End the Fed!" has been libertarians' rallying cry at least since Ron Paul's 2009 book of the same name. I prefer the saying "privatize monetary policy." The markets are more than capable of setting interest rates on their own. They often do, without help from bureaucrats. There is also a lot of evidence that the Fed officials are simply following the cues of the short-term interest rate markets. The interest rate that the Fed sets is called the Federal Funds Rate. This is the interest rate at which banks lend to each other on an overnight basis, mostly for capital requirements or balance sheet reasons. The Fed sets the interest rate target, which these days is a range of one-quarter of a percent, and then adjusts it through open market operations, either buying or selling to keep the actual Fed Funds Rate in line with the target rate. All other interest rates, such as longer-term interest rates, and commercial interest rates such as the prime rate, are benchmarked off Fed funds. The Fed doesn't determine 10-year or 30-year interest rates (yet)—those are left to the bond market. It has been argued that the biggest financial crisis since the Great Depression was a result of leaving interest rates too low for too long after the dot-com bust, and then-Fed Chair Alan Greenspan was considered to be a good central banker. Zero percent interest rates throughout the 2010s led to asset bubbles and a huge misallocation of capital. Greenspan's predecessor, Paul Volcker, gets credit for stopping the great inflation by raising interest rates, although it resulted in a 6 percent drop in gross domestic product. When central bankers make errors, it is usually because they leave interest rates too low, sometimes due to strong political pressures. Market-determined interest rates would be messy but good. There would be volatility in short-term rates for sure. But who could do the job better? Traders would do a better job of determining monetary policy than a group of politicians with Ph.D.s in economics. A president shouldn't be in charge of interest rates. Profit-seeking economic actors should guide interest rates. At least if they are wrong, they are severely punished by losing money. There are no such consequences for the Fed officials. The post Trump Rages at the Fed Over Interest Rates appeared first on Sign in to access your portfolio
