Why is President Trump calling on the Federal Reserve to cut the rate by a full percentage point, despite the robust jobs number for April and the strong GDP report last week?

Wall Street and most economists can’t rationalize the demand and feel if the good data continues the next move by Jerome Powell may be to raise rates.

What the “experts” are missing in the equation is the unprecedented events that will take place in the second quarter of this year well outside of the economy.

What will investors do when the top intelligence officials from the Obama administration are indicted for spying on the incoming president? What does the Dow do when treason and/or sedition charges are brought against Democrats, some of whom are running for the 2020 presidential nomination?

These are such one-off events that no one can predict the financial impact to the markets.

Despite Attorney General William Barr trying to lay the groundwork by alerting Americans that there was spying going on against the Trump team in his testimony to the Senate Judiciary Committee, there’s little history to figure in to assess the fall out from criminally charging the prior administration with these allegations.

Dow futures are down 500 points Monday morning on China tariff worries again. How large would the drop be on the news I lay out below?

Before the Fed meets again in June:

• We may see a report on ex-FBI Director James Comey and his involvement in Spygate along with his former deputy Andrew McCabe his deputy.
• Americans will also get to witness the declassification of the FISA warrants used to spy on the Trump campaign and the lack of credible evidence behind the warrants.
• And finally we may have the Department of Justice Inspector General Michael Horowitz’s report on ex-Attorney General Loretta Lynch and her department’s involvement in Spygate along with other possible criminal complaints.

Anyone of these reports would have the capability to knock the legs out from under the markets. Taken in total — for the sake of prosecutions — the need to protect average Americans from a market crash is the goal with Trump’s request to Powell.

As proof I point to the fact that Powell after meeting with Trump early this year reversed his stance of possible three rate hikes this year to none so far.

I believe the President told Powell that things will change dramatically this year and that the Fed will need to be nimble in its moves.

So why no cut this last meeting? Well, the Fed can cut rates anytime it wants to. It does not have to wait for a meeting.

So, we shall see.