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If Trump fires the Fed’s Powell ‘both the currency and the bond market can collapse,’ according to Deutsche Bank (fortune.com)

submitted 2 weeks ago by babysandpiper@sopuli.xyz to c/economics@lemmy.world

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If Trump gets his way and removes Jerome Powell as chairman of the U.S. Federal Reserve, the market reaction would be swift and brutal, Deutsche Bank’s George Saravelos argues.

It could collapse the currency and bond markets, he says in a note seen by Fortune. Polymarket puts the chances of a Powell ouster at 19%.

“We consider the removal of Chair Powell as one of the largest underpriced event risks,” Saravelos says.

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[–] Revan343@lemmy.ca 5 points 2 weeks ago (4 children)

So...what do I buy puts on, to profit from this?

[–] funkforager@sh.itjust.works 3 points 2 weeks ago (1 children)

SPY or related index etfs

[–] DragonTypeWyvern@midwest.social 3 points 2 weeks ago* (last edited 2 weeks ago) (1 children)

If you assume the entire stock market won't collapse. Half those companies aren't just inbred, they're codependent.

[–] Vanilla_PuddinFudge 2 points 2 weeks ago

Finally, some good news.

[–] ikidd@lemmy.world 2 points 2 weeks ago

Yes

[–] Ushmel@lemmy.world 2 points 2 weeks ago* (last edited 2 weeks ago)

"you want to short the federal government??? yeah we will take your money high five bro"

I think I've seen this movie.

You can buy inverse ETFs on bond market benchmarks. Unlike stocks though, the interest rate will tick up as bond demand (price) goes down, so the dips tend get muted as people gobble up anything over 5%

[–] burgerpocalyse@lemmy.world 1 points 2 weeks ago

1000 units of gold-pressed latinum