Cramer Cautions Dow Bulls About China’s Virus Outbreak
Virus outbreak concerns in China began to recede after
Beijing stressed its ability to deal effectively with the Wuhan coronavirus.
Dow bulls are pressing on, but fund manager and TV personality Jim Cramer said he’s worried that things aren’t as under control as investors would like to believe.
Concerns about the virus stem from the SARS epidemic in , which had a definite impact on stocks and productivity in the region that spread to global markets.
He warned that this central bank policy “trap” could come back to haunt the stock market:
The only thing I have trepidation about is negative interest rates, QE, and the diversion between stock prices and bond prices and yield and stuff like that … I think it’s very hard for central banks to forever make up for bad policy elsewhere, that puts in them in a trap. We’re a little bit in that trap today with rates so low around the world.
Dimon is not the first person to worry about the global economy’s ability to extricate it from years of unconventional monetary policy.
Hedge fund billionaire Ray Dalio has also been vocal about the dangers associated with runaway valuations in US stocks.
Most recently, Guggenheim’s Scott Minerd doubled down on his claim that the markets look like a Ponzi scheme amid the Fed’s stealth QE.
Dow Stocks: Boeing Struggles Again, IBM Soars Post Earnings
It was a general solid day in the Dow 100, as the index was able to establish itself in the green.
With Boeing stock (NYSE: BA) in free-fall after a downgrade and another MAX delay, new CEO David Calhoun reassured investors that the US aerospace giant would continue to pay its dividend . BA shares still fell 1.5% on the day.
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