The worst December in 87 years. That's the record of major U.S. equity indices this month. Both the Dow Jones Industrial Average and the S&P 500 are down over 7 percent this month with no end in sight. The Federal Reserve is, as of this writing, eight hours away from announcing their rate decision and providing guidance for 2019 and 2020. I predicted a few weeks ago that the U.S. Federal Reserve (the Fed) would forgo a final rate hike in January and not hike at all in the first two quarters of 2019. While I stand by the latter part of the argument, President Trump is seemingly goading the Fed to hike rates, and the Fed may very well have hiked rates by the time you read this. You will benefit from knowing the Fed's decision as you read this column, but the fact is this rate hike, or lack of one, isn't as important as the wording the Fed uses to describe the future as it sees it.

President Trump tweeted Tuesday: "I hope the people over at the Fed will read today's Wall Street Journal Editorial before they make yet another mistake. Also, don't let the market become any more illiquid than it already is. Stop with the 50 B's. Feel the market, don't just go by meaningless numbers. Good luck!" While deliberately trying to influence the Fed, Trump must realize that the Fed won't respond well to his words. Implying that the Fed is making "the market... illiquid" is a major accusation in and of itself. Further implying that it goes by "meaningless numbers" is as much of an insult as is possible. How will the Fed respond?

If the Fed doesn't raise rates, as it had already been slated to do, it will appear to have bowed to political pressure. If it does raise rates and the market continues to tank, Trump will have a great scapegoat in the Fed and can blame it for market turmoil. Trump has, again, positioned himself masterfully here. Whatever the Fed decides, its wording will be what the market watches for. Should the Fed decrease its predicted rate hikes next year from three to two as expected, the markets will breathe a sigh of relief. If they actually come out and say they will suspend all hikes, as I believe they will, this will spook the markets and spark the very market sell-off the Fed was trying to prevent. The Fed is very much between a rock and a hard place on this one.

While equity markets have been punished in recent weeks, sending indices into negative territory for the year, crude oil has all but imploded. With Brent crude oil trading near 55 dollars per barrel and West Texas Intermediate (WTI) nearly 10 dollars less with no signs of improvement, energy prices are in major correction territory. Should the Fed's guidance point to a major realignment of monetary policy with rates flat or actually decreasing in the next 12 months, dollar flight will take place. Coupled with lower energy prices, a drop in the dollar will be music to the ears of emerging market (EM) investors as both EM currencies and equities will be the beneficiaries of lower energy prices and stronger currencies. This is especially true for EMs, such as Turkey, which depend almost entirely on energy imports.

It will be very interesting to see how the Fed breaks the bad news to the markets, but whatever the announcement, President Trump's victory tweet will be close behind.