Day 1,154: Markets keep falling, ‘Trump bump’ virtually gone
The stock market plunged again Wednesday, continuing a five-week trend. Markets have largely responded to Donald Trump’s inept and delayed response to the coronavirus outbreak and the Federal Reserve’s panicked decision-making.
Markets have now all but erased gains since Trump’s inauguration.
The Dow Jones Industrial Average’s decline below 20,000 almost completely erased all of the iconic index’s previous gains since Trump’s inauguration, jeopardizing a key talking point for his reelection campaign. Earlier in the day, the S&P 500 fell by more than 7 percent, triggering a marketwide trading halt.
Since his 2016 victory, Trump has tweeted dozens of times about the record stock gains under his watch, posting as recently as Feb. 19 that it was the “Highest Stock Market In History, By Far!” He has repeatedly suggested that Americans check their 401(k)s to tote up their gains, and argued that the markets would have crashed had Hillary Clinton defeated him.
Now the upheaval sparked by the coronavirus pandemic, coupled with plunging oil prices and fears that shares were already inflated, has panicked investors, sending the Dow below the 19,827 where it stood on Jan. 20, 2017, the day Trump was inaugurated. Stocks pared their losses late in the day, and the Dow closed at 19,904.
For the Trump administration, they’ve already framed the issue simply: markets up = success; markets down = failure.
Trump’s top economic aides have also eagerly made the connection between the health of the stock market and the success of his presidency.
In a CNBC interview a month after Trump’s inauguration, Treasury Secretary Steven Mnuchin said he “absolutely” views the stock market as a “report card” for the administration.
Considering markets typically return an average of 10% per year, and Trump has now overseen a net gain of virtually zero — with all gains wiped out in just five weeks’ time — he has earned a failing grade.
1,154 days in, 308 to go
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