P Spx: Trade War and December Performance

p spx: Yes, that really is a form of quantitative easing QE no matter how they spin it, according to Market Watch. Instead of dire headlines on the trade war, now there's a phase one trade deal with China, where new tariffs are cancelled, and some old ones are cut . Instead of diving in an unseasonal manner, as U.S. stocks did in December 2018 where at one point in the month the market was on track to deliver the worst December performance since 1931 the S&P 500 SPX, -0.02% now is hitting all-time highs. Instead of overtightening, as it did back then, the Federal Reserve is accelerating the growth of its balance sheet. Looking back a year ago, my prediction for U.S. stocks in 2019, coming when the market was at its worst, worked out quite well see No bear market for stocks in 2019 because economy, earnings will keep expanding . At that time, I was trying to filter out the senseless panic in the air on December 26, 2018 the day of the 2018 intraday S&P 500 low 2,346.58 . It's that time of the year again, so here's my 2020 forecast emerging markets get more attractive; U.S. stocks go higher, the economy strengthens and President Donald Trump is re-elected. The same way quantitative tightening hurt the U.S. market in 2018, the opposite nowadays boosts stocks and the economy. Here's a big reason why If the Fed goes through with its pledge to buy 60 billion of Treasury bills through the second quarter of 2020, the Fed balance sheet will be at, or close to, an all-time high in 2020 see this chart . Quantitative easing is like printing money but for financial institutions only and this inflates the prices of both stocks and bonds. (news.financializer.com). As reported in the news.