Tuesday, July 19, 2016

All Markets Are Connected, The US Economy Cannot Be An Island of Strength Forever

The trouble with domestic only analysis is that it assumes that markets, the manifestation of the intentions of the invisible hand, are independent (isolated) rather than interconnected. The Brexit, for example, would have a close to zero only if the US economy, a collection of markets, was completely independent of the global economy.  It's not, of course.  Any comment attempts to describe the US as island of strength within the sea of global turmoil is an illusion driven by opinion.  The Fed's opinion will quietly disappear into the data files of the Internet, rarely discussed unless queried by an automated google search or an aspiring mind that recognizes all markets are connected.

Headline: Fed’s Bullard Says Brexit to Have ‘Close to Zero’ U.S. Impact

Federal Reserve Bank of St. Louis President James Bullard said he thought the U.K.’s vote to leave the European Union wouldn’t have a lasting effect on the U.S. economy, joining Cleveland Fed chief Loretta Mester in playing down the threat Brexit poses to the U.S.



Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.