Part 11/15:
Recent market movements reflect the uncertainty caused by tariff negotiations. The abrupt change in trade policy led to a 7% surge in the S&P 500 on Wednesday, only to be followed by sharp declines. Treasury yields soared, and the VIX index spiked, indicating heightened volatility and investor nervousness.
Concerns about future inflation are mounting, with consumer sentiment dropping and inflation expectations reaching levels not seen since the early 1990s. The White House’s tariff negotiations, though intended to stabilize trade, risk pushing inflation upwards, which can lead to higher interest rates—adversely affecting growth and stock prices.