In reaction, the Dow Jones Industrial Average fell 300 points as markets opened on Wednesday morning, before recovering somewhat, according to reports.

Cohn was Trump’s top economic advisor, heading something called the National Economic Council (NEC).

The market has seesawed in recent weeks, and key indexes are down from record highs reached in January. In addition to Cohn’s departure, experts have cited concerns about inflation and rising interest rates, as well as the possibility of a trade war stoked by new tariffs on aluminum and steel.

So who is Gary Cohn?

Cohn was Trump’s top economic advisor, heading something called the National Economic Council (NEC).

The NEC helps to coordinate policy-making for domestic and international economic issues. It also helps to coordinate economic policy, advice, and goals for the president, and assists in  implementing the president’s economic policy agenda, according to its mission statement.

One objective of the NEC is to ensure the president hears competing points of view on economic policy.

Why did Gary Cohn quit?

Cohn, a Democrat, is a free-trade advocate, meaning he supports open international trade with limited restrictions on exports and imports, as well as trade agreements such as the North American Free Trade Agreement, and the Trans-Pacific Partnership.

These treaties favor negotiations around imports and exports, in contrast to trade wars.

Last week, the president announced he would levy tariffs on aluminum and steel imports of 10% and 25%, respectively.

The move provoked strong international condemnation from trading partners, as well as numerous members of Congress, such as House Speaker Paul Ryan (R-Wis.) It also prompted fears that trading partners would impose tariffs of their own on U.S. products, in retaliation.

Why does Cohn’s departure matter?

Cohn was viewed by many on Wall Street as a voice of reason, according to financial experts who have expressed concerns that his departure adds uncertainty to the Trump administration’s economic direction.

“Cohn has been a voice of moderation, he’s been a voice who understands markets, who understands investors, a voice that’s committed to US playing a leadership role in the global system. His departure leaves an enormous void in that sense,” Nathan Sheets, the chief economist at PGIM Fixed Income told CNBC on Tuesday.

On Wednesday, Treasury Secretary Steve Mnuchin said the administration would go ahead with its planned tariffs on steel and aluminum.

Gary Cohn’s background

Cohn, the grandchild of Polish immigrants and the son of a middle class family from Ohio, struggled with academics due to dyslexia, but ultimately landed a job at Goldman Sachs, according to reports.

He started out in the Goldman’s bonds and commodities divisions and moved on, over a 20-year career at the bank, to become its president and chief operating officer.

He left those positions in 2016 to work for the Trump administration.

Here’s what Goldman chairman and chief executive Lloyd Blankfein had to say about Cohn on Twitter on Tuesday:

Gary Cohn deserves credit for serving his country in a first class way. I’m sure I join many others who are disappointed to see him leave.

— Lloyd Blankfein (@lloydblankfein) March 6, 2018

The post Who is Gary Cohn and Why Does His Departure Matter? appeared first on Stash Learn.

Commodities are the stuff of life. They’re also one of the building blocks of the economy, and they’re as old as time. They’re things like gold, steel, aluminum, oil and even food. Pork bellies and cattle, live and turned into beef. They’re also the unleaded gas in your car. The corn and sugar in your pantry.

All of these things are commodities. They’re all valuable, and that’s why people invest in them.

What are commodities?

Unlike some of the more esoteric elements of the economy, commodities are rooted in reality. They’re heavy, they fill up pallets, and sometimes they even smell and make noise. They’re more tangible than currency, and they’re certainly more earthy than that flashy new stuff called cryptocurrency. And they’re easier to understand.

Commodities are useful. People were trading in gold and wheat thousands of years ago. Why? Their value is undeniable. Gold is generally considered the safe haven for investment, because everyone has always recognized its value.

How are commodities traded?

Commodities are divided into several categories, including energy, metals, agriculture, meat and consumer goods. Energy includes oil and gasoline, both natural and unleaded. Metals include gold, silver, platinum and copper. Agriculture includes corn, soybeans and wheat. Meat includes hogs and live cattle. Consumer goods include cocoa, coffee, cotton and sugar.

Commodities are divided into several categories, including energy, metals, agriculture, meat and consumer goods.

In the U.S. the two largest commodity exchanges are in New York (of course, think Wall Street) and Chicago (which makes sense, considering the stockyards of “The Jungle,” by Upton Sinclair.) They are called the New York Mercantile Exchange, the NYMEX and the Chicago Mercantile Exchange, CME.

Why do people invest in commodities?

Here’s something else, to keep in mind: Commodities can act as hedge against inflation, according to some experts, since they tend to increase in value as inflation rises.

Inflation can have a negative impact on  other stocks. And as we wrote recently, fears about inflation have sparked some of the current market turmoil. So commodities can potentially work as a stabilizing position in a portfolio when other equities are particularly volatile.

How do people invest in commodities?

There are three primary ways to invest in commodities

You can buy the actual raw product. Cowboys still run cattle drives into Fort Worth, Texas and miners still extract gold from the depths of South Africa. But if you don’t feel like buying a ton of zinc on a pallet and trying to figure out how to unload it, there are other ways.

Some investors put their money in commodity futures. They may try to predict what will happen to the price of bacon a month or two down the road.

Others might invest in exchange-traded funds, also known as ETFs. They’re perhaps the most user-friendly tools for investors, since they act as baskets of commodities (such as pork bellies) which are traded as units on the market.

What are the risks?

Commodities can still be subject to volatility, caused by natural shortages, or even political uncertainty. President Trump and the U.S. Department of Commerce unveiled a blueprint recently that would impose a 24% tariff on all steel imports, and even steeper tariffs of 53% on steel imports from a dozen countries. This could spark fresh price swings in commodities markets.

Explain it to me: What’s a tariff?

Oil is also notoriously volatile, experiencing the worst spikes during its long history in 1979, when the unstable political situation in Iran disrupted the flow of petroleum, followed by an even worse spike in 1980 with the Iran-Iraq war. Oil prices spiked once again to their biggest peak ever in 2008, when hit $100 a barrel for the first time, due to a regional crisis.

Even something as simple as corn can be the plaything of the environment and politics. Remember when biofuels like ethanol were going to change the world? That was also in 2008, when corn prices spiked so dramatically from the ethanol boom that was blamed for driving up food prices in general.

Back in October, the CME Group in October started including the trading of bitcoin futures in its exchange. Is cryptocurrency the new commodity?

Not yet. The thing about commodities is that they’re rooted in the real world. And for investors looking to diversify, they can potentially have a place in your portfolio that can hedge against inflation and rising interest rates.

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