Edward Harrison

United States

Senior Editor, Bloomberg Media at Bloomberg News

Senior Editor @business

Articles

The Federal Reserve's Hold Creates Downside Equity Risk

1 week ago | bloomberg.com | Edward Harrison

This was one of the more challenging Federal Reserve decisions to anticipate. US macro data has deteriorated so much that, normally, you’d expect policymakers to cut interest rates. However, they’ve already said tariffs are keeping them on hold for a while, unless things really fall apart. Military conflict between Iran and Israel can only make that hold longer. Therefore, it was anyone’s guess what the Fed’s dot plot of interest rate projections would show.
Recession Risk Looms Over a US Stock Market That Wants to Rally

2 weeks ago | bloomberg.com | Edward Harrison

In financial circles, there’s an old adage: “Don’t fight the Fed.” That framing makes it seem like the Federal Reserve dictates and the market falls in line. I’d like to change the saying to: “Don’t fight the bull market,” to reflect the current zeitgeist. Sure, investors can de-risk tactically — by changing sector and country allocations, for example.
The TACO Trade Will Explode in July

3 weeks ago | bloomberg.com | Edward Harrison

Donald Trump has proven to be a lot more malleable than many in the financial world initially anticipated. Equity markets have adapted well, and now trade on the theme that Trump always chickens out (or TACO for short). That helped the S&P 500 gain 7% last month. But will this last? And will Trump capitulate again when the 90-day reciprocal tariff deadline comes?
Beware of the Almighty Dollar’s Fall

1 month ago | bloomberg.com | Edward Harrison

Have you seen the Road Runner cartoon, where the coyote chases the speedy bird only to overshoot the mark and run off the cliff? At first, Wile E. Coyote levitates as if he’s still on firm ground, but once the illusion fades, he plummets toward rock bottom. That’s the risk with US financial markets as foreign investors withdraw their support. To be sure, a panic isn’t the likely outcome here.
Trump Capitulates, But Buyer Beware

1 month ago | bloomberg.com | Edward Harrison

Now that the trade war between the US and China has de-escalated, everyone on Wall Street seems to think the risk of recession is greatly diminished. This suggests that Treasury yields will rise because the Federal Reserve won’t need to save the day. My view is that the Fed was never going to save the day to begin with, so de-escalation actually opens the door for rate cuts in a weakening labor market. Unlike the majority on Wall Street, I see downside risk in equities, not bonds.
No, the Fed Won’t Bail Out Trump (or Equities)

1 month ago | bloomberg.com | Edward Harrison

This article is for subscribers only. Equity markets have already sniffed it out: The pressure on Donald Trump to make trade deals is too great to think tariffs won’t come down from the lofty levels advertised on “Liberation Day.” The question is whether the deals come too little too late — and if so, whether the Federal Reserve will bail out the president. If you look at where stocks and bonds are trading, it’s clear many investors are betting that central bankers will ride to the rescue.
Investors Are Fleeing US Assets as Global Financial Crisis, Recession Loom

2 months ago | bloomberg.com | Edward Harrison

US President Donald Trump’s ‘America First’ economic revolution has quickly turned into ‘America Last’ as far as financial markets go. So many investors have been dumping US assets wholesale that we recently saw equities, bonds and the US dollar all decline in a self-feeding doom loop that hasn’t only hurt the value of American financial assets. If Trump persists, it threatens to cause an extended bear market and a financial crisis.
Stock Market Jitters Aren’t Just About Trump

2 months ago | bloomberg.com | Edward Harrison

This article is for subscribers only. It seems the bond vigilantes have claimed another victim — Donald Trump. The recent correction in US asset prices encompassing equities, the dollar and, crucially, Treasury bonds has caused the president to cave on much of his tariff bluster. He’s also eased back on his tough talk against Federal Reserve Chair Jerome Powell. That’s a good thing for the US and global economy, but a lot of damage has been done. I, for one, still expect a recession.
We Are Still Heading Into a Bear Market

2 months ago | bloomberg.com | Edward Harrison

This article is for subscribers only. This isn’t the newsletter piece I had intended or even wanted to write. But given the massive tariff levies, the 90-day pause for non-retaliation and wild market gyrations we are now seeing, events over the last 24 hours have overtaken my plans. As it stands, the S&P 500 just about tipped into a bear market before news that there was a 90-day reprieve caused a huge relief rally.
How Markets Are Assessing Trump's Grand Tariff Experiment

2 months ago | bloomberg.com | Edward Harrison

This is Washington Edition, the newsletter about money, power and politics in the nation’s capital. Today, senior editor Edward Harrison, author of Bloomberg’s Everything Risk newsletter, assesses the market reaction to the president’s tariffs. Sign up here and follow us at @bpolitics. Email our editors here. We’ve never seen an experiment with macroeconomic policy this large. I’m talking about the sweepingtariffs President Donald Trump announced today, of course.