November 26, 2019
On November 18, President Trump met with Fed Chairman Jerome Powell and Treasury Secretary Steven Mnuchin. The official Fed statement said that “Powell said that he and his colleagues on the Federal Open Market Committee will set monetary policy, as required by law, to support maximum employment and stable prices and will make those decisions based solely on careful, objective and non-political analysis.”
In other words, the Fed is following its Congressional mandate and refuses to be influenced by President Trump’s rhetoric. I should add that President Trump tweeted that they had a “very good & cordial meeting” and they discussed a range of issues including “interest rates, negative interest, low inflation, easing, dollar strength & its effect on manufacturing, trade with China, E.U. & others, etc.”
I suspect that President Trump reminded Fed Chairman Powell that a strong U.S. dollar is causing U.S. manufacturers, such as Tesla, to continue to outsource their manufacturing to China. Ironically, the lack of commodity price inflation is one cause of low inflation, since commodities are priced in U.S. dollars. In a recent speech, Powell called the U.S. economy a “star” performer and expressed confidence that its current record-long expansion will persist. Hopefully, Powell and Trump can at least agree on that point.
Navellier & Associates does not own Tesla pillar in managed accounts and a sub-advised mutual fund. Louis Navellier and his family do not own Tesla in personal accounts.
Update on Hot Spots Around the World
There were a lot of interesting developments around the world last week. China is now being much more aggressive in Hong Kong, arresting protestors. Iran shut down the country’s internet service after reports from Amnesty International of at least 106 deaths from massive protests over fuel price increases. And Israel remains on high alert as its “Iron Dome” continues to shoot down missiles fired from Gaza.
In our own hemisphere, Bolivia’s new government kicked out around 725 Cuban doctors and medical staff as it recalled its diplomatic staff from Venezuela due to external election meddling. Colombia has been very generous and has accepted 1.4 million official refugees from Venezuela, but the real number of refugees may be closer to two million. Ecuador and Peru are now rejecting Venezuelan refugees, which is putting more pressure on Colombia. A senior international official said “Colombia is now a ticking time bomb” due to the rising tide of Venezuelan refugees. In fact, the Columbia government announced plans to close its borders to contain mass protests that are planned in other Latin American countries.
I recently spoke at a conference in Miami, where the Cuban Security forces were being blamed for their influence in Venezuela and meddling in Bolivia, Chile and other countries in Latin America. Russia also continues to meddle in Venezuela, while China has been spreading influence throughout Latin America.
It’s sad that our news media is nearly 100% focused on political news, ignoring the rest of the world.
CHIEF INVESTMENT OFFICER
Louis Navellier is Founder, Chairman of the Board, Chief Investment Officer and Chief Compliance Officer of Navellier & Associates, Inc., located in Reno, Nevada. With decades of experience translating what had been purely academic techniques into real market applications, he believes that disciplined, quantitative analysis can select stocks that will significantly outperform the overall market. All content in this “A Look Ahead” section of Market Mail represents the opinion of Louis Navellier of Navellier & Associates, Inc.