JPMorgan Strategist Warns of Economic Risks Post-Trump Victory

Following Donald Trump's reelection, U.S. stock markets surged, with major indices seeing significant gains, while bond yields spiked, raising concerns for borrowers as mortgage rates may approach 7%. JPMorgan's David Kelly highlighted that Trump's potential tax cuts could boost corporate earnings but warned of inflation risks, suggesting that tariffs could harm the economy. The 10-year Treasury yield jumped to its highest since July, indicating that Trump's policies could complicate the Federal Reserve's interest rate strategies. Cryptocurrencies like Bitcoin also saw upward movement, reflecting a favorable sentiment towards Trump's digital currency policies, despite broader market uncertainty about his second term. Analysts express caution as Trump's proposed tariffs and potential Federal Reserve independence curbs might lead to unpredictable economic consequences. Overall, while the immediate market reaction is positive, the long-term implications of Trump's policies remain ambiguous.