The stock market's horror show gets scarier

[Bloomberg]( Today’s Agenda - The Fed [can't win](; neither can [the market](. - Britain needs some [remedial Brexit instruction](. - Russia is [meddling in the Balkans]( now too. - China’s got no reason to [fear a stronger yuan](. - This has been a great year for [terrible corporate PR](. The Fed Vs. the Markets If you had any doubt the Fed and markets see two completely different economies, today’s action should put that to rest. If the economy were a TV show, the Fed would see “House Hunters” while the stock market sees “The Haunting of Hill House.” Stocks [tumbled hard]( for a second straight day, with the Nasdaq Composite Index briefly dipping into [bear-market territory](. Meanwhile, the yield curve – the gap between two- and 10-year Treasury yields – shrank nearly to zero, on the edge of going negative and signaling a recession. Unlike yesterday’s freak-out, which was mostly about the Fed not being as freaked out as the stock market is, today’s was brought to you partly by President Donald Trump pushing the government [closer to a shutdown]( over border-wall funding. Whatever the reason, it’s more evidence markets are panicking like [Private Hudson]( in “Aliens,” in stark contrast to the calm optimism the Fed displayed yesterday when it raised its key policy rate and said it planned to raise rates twice again next year. Mohamed El-Erian writes [the Fed can’t win](, after nearly a decade of being unable to lose. For years, a sluggish economy let the Fed keep pressing on the gas, helping the market boom. Now the economic data are fine, and the Fed feels it must get policy back to normal, but the markets are in crisis. It’s as if, John Authers writes, traders suddenly realized “quantitative tightening” – the opposite of the Fed’s crisis-era policy of “quantitative easing” – is [as bad for markets as QE was good](. And really, as Robert Burgess writes, even if the Fed had surrendered to the market’s point of view, that probably wouldn’t have helped. [Stocks seem determined to fall](. This month is well on track to be the second-worst December of all time for the market. And a bad December, Bob notes, is often an omen of a bad year to come. Scary stuff. Further markets reading: The Fed and FedEx Corp. [both delivered bad news]( to emerging markets yesterday. – Shuli Ren Time for Remedial Brexit The U.K. is hurtling headlong toward a Brexit deadline with no real leadership and no clue of how to avoid disaster. Is there any way this ends well? If this were a class of particularly dunderheaded students, then you would try to make it easier on them, writes John Micklethwait, maybe [by giving them a multiple-choice test](. In this case, parliament and/or the people would be allowed to pick from an array of options, from remaining in the EU to a few varieties of Brexit. “This will drive the Brexiteers mad. The initial referendum was supposed to be a once-in-a-lifetime vote, they will point out. But it is also clear that circumstances have changed,” John writes. Read the [whole thing](. Russia Is At It Again It’s time once again for the world’s least-favorite game show: Who Is Vladimir Putin Bothering Now? Today’s target is the [Balkan states formerly known as Yugoslavia](, right on Europe’s southeastern flank. Bloomberg’s editorial board points out Russia has responded to signs of terrifying stability in the region by breaking out its fully array of destabilization weapons, including hacking and disinformation campaigns. The EU and U.S. must be more proactive about embracing Balkan states and letting them know they’ll protect them, the editors write. Read the [whole thing](. Further Russia Reading: It’s a bad sign for Putin that he wants to [ban street displays of the ruble’s value](. – Leonid Bershidsky China Shouldn’t Fear a Strong Yuan One of the goals of the Trump administration’s trade war with China seems to be to force that nation to let its currency appreciate. A stronger yuan would make Chinese manufactured goods less competitive in the global market, for one thing. China is not a fan of this for a few reasons, one of which may be the belief that the Plaza Accord of 1985, in which Japan and others agreed to let their currencies rise, wrecked Japan’s economy. Noah Smith examines this idea and finds it sorely lacking. In fact, evidence suggests  [Japan’s currency appreciation had no noticeable effect]( on its economy or trade imbalance – meaning a similar move might not be the big win Trump wants either. Further Trade-War Reading: Trump’s intervention in the Huawei case, using it as a trade-negotiation chip, is deplorable. It [makes a mockery of the rule of law]( and embarrasses Canada and U.S. prosecutors. – Bloomberg's editorial board Corporate America’s Dubious Achievements of 2018 From Facebook Inc.’s near-monthly self-owns to Under Armour Inc.’s affinity for strip clubs, this has been quite a year for companies behaving badly. Kara Alaimo breaks down the [five biggest corporate PR blunders of the year](. Remember when Lockheed Martin Corp. asked people to tag photos of its products in use? Or H&M’s “monkey” hoodie? Or Victoria's Secret’s tone-deafness about plus-sized models? Good times. Telltale Charts The beauty business is being [roiled by upstarts and new trends](, which is driving deal-making for an old guard trying to keep up, writes Tara Lachapelle. When you shop on Amazon these days, you’re increasingly likely to see Amazon.com Inc.'s private-label products. This forces brands to [pay Amazon to advertise their stuff]( to compete. Either way, Amazon wins, Shira Ovide writes. Further Reading Altria Group Inc. buying a stake in e-cigarette maker Juul Labs Inc. may be [more timid than transformational](. – Sarah Halzack You might think Bitcoin has had a bad year, but [it’s had worse](. – Aaron Brown Ignore Elon Musk’s antics and [focus on Tesla Inc.’s numbers](, and you’ll be happy. – Matthew Winkler Trump's Syria pullout and offer of a Patriot missile-defense system [isn’t the clear win for Erdogan]( it seems. – Bobby Ghosh Good riddance to Paul Ryan, who is [a liar, a fraud and bad at his job](. – Jonathan Bernstein There’s a bright side to [Western consultants like McKinsey]( working for autocracies. – Tyler Cowen The Gatwick Airport shutdown is evidence that drone you're buying your nephew is [a public safety menace](. – Leonid Bershidsky My 15 [favorite non-fiction books]( of 2018. – Stephen L. Carter ICYMI Robert Mueller is [saving the best for last](. Amtrak’s [Northeast Corridor is drowning](. Kickers Carbon-testing finds a third of [rare Scotch whiskies are fake](. (h/t Mike Smedley) Can’t believe we have to say this, but “[volcano tourism” is a bad idea](. (h/t Scott Duke Kominers) We should ditch Facebook and go back to the days of [personal websites](. Conscious [thought is an illusion](. Spend a day with the [Christmas-tree vendors]( of New York City. The AV Club’s [best movies of 2018](. Note: Please send thoughts, suggestions and kicker ideas to Mark Gongloff at mgongloff1@bloomberg.net. New to Bloomberg Opinion Today? [Sign up here]( and follow us on [Twitter]( and [Facebook](. [FOLLOW US [Facebook Share]]( [Twitter Share]( SEND TO A FRIEND [Share with a friend] You received this message because you are subscribed to Bloomberg's Bloomberg Opinion Today newsletter. [Unsubscribe]( | [Bloomberg.com]( | [Contact Us]( Bloomberg L.P. 731 Lexington, New York, NY, 10022