The Stock Market Follow-Up

A couple of days ago, I wrote about the Stock Market when it was at a very low point. It had fallen for a few days and didn’t show any promise.

I wrote about how awkward it was for the President that boasted for so long about how strong it was.

I wrote that there had to be some reason for the fall.

Today, the fall that we saw that hurt so many people’s pocket books, temporarily, is a little bit easier to understand and I want to explain a bit of it to you.

Basically, the market needed a moment to catch its breath. It had seen such positive spikes since the Presidential election that it was time for it to bounce back to normal levels.

I think a large part of the increases came from all of the changes that we are experiencing in the world we live in today.

This makes sense, the President just signed into law a massive tax cut and the unemployment rate fell to an attractive low.

These would be perfect reasons for the economy to boom and the Stock Market to take off.

If the economy is working, money is spent and stock prices soar through the roof.

This, however, can be the exact reason a fall happens. What goes up has to come down.

The Stock Market, sometimes, is not the most accurate picture of how the Economy is performing.

In this case, investors essentially worried that the Economy was “too strong”, if that makes any sense. If wages increased and unemployment decreased, they worried this would have a negative impact.

So, yes, the Stock Market is a Political conversation!

It’s been an interesting couple of weeks, but I think we can all relax about the stock market; it just needed a moment.


Blake Tarmann