Losing Confidence

Consumers are feeling okay about the present situation, but they are losing their confidence in the future. The obvious cause of their anxiety is Trump Turmoil 2.0. The Trump administration admits that its trade and DOGE policies might cause some economic pain in the short run but says they should lead to big gains in the long run ("The Golden Age of America").

The problem is that we Americans don't do pain very well. Americans are worrying that a recession is becoming more likely and that means fewer jobs. As a result, yesterday's big rally in the stock market stalled today following the release of the March consumer confidence report this morning. We continue to expect a choppy stock market for the next couple of months.