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Markets Erase All Gains During Trump Presidency

Markets Erase All Gains During Trump Presidency

The Dow Jones Industrial Average slid yet again on Wednesday, erasing all of the gains it had made since Donald Trump took office — as well as a key argument Trump has made for his reelection in November.

When Trump took office, the Dow stood at 19,827 points. On Wednesday, that number was even lower — 19,520 at the time of publication.

That’s down from a high of 29,398 on Feb. 14.

The market has struggled for weeks amid the growing COVID-19 outbreak. On Wednesday, the latest drop triggered the fourth automatic halt in trading in a month.

The stock market slide — thanks to economic fallout from the outbreak and related business closures — could spell trouble for Trump’s reelection hopes.

Trump has long touted stock market gains as evidence that voters should give him a second term in office.

More specifically, he has claimed that Americans’ 401k retirement accounts were performing well because of him.

“STOCK MARKET AT ALL-TIME HIGH! HOW ARE YOUR 401K’S DOING?” Trump tweeted in on Jan. 9. “70 percent, 80 percent, 90 percent up? Only 50 percent up! What are you doing wrong?”

He also touted market gains in his State of the Union speech in February.

“Since my election, U.S. stock markets have soared 70 percent, adding more than $12 trillion to our nation’s wealth, transcending anything anyone believed was possible,” Trump said. “This is a record. It is something that every country in the world is looking up to. They admire. Consumer confidence has just reached amazing new highs.”

He added, “All of those millions of people with 401ks and pensions are doing far better than they have ever done before with increases of 60, 70, 80, 90 and 100 percent, and even more.”

Trump has similarly celebrated market milestones, suggesting they were tied to his success as president.

“New Stock Market RECORD. Congratulations, spend your money wisely. KEEP AMERICA GREAT!!!!!” Trump tweeted just a few weeks ago on Feb. 11. 

He even used the stock market success as reason why he shouldn’t be impeached and removed from office.

“STOCK MARKET CLOSES AT ALL-TIME HIGH! What a great time for the Radical Left, Do Nothing Democrats to Impeach your favorite President, especially since he has not done anything wrong!” Trump tweeted on Dec. 23, 2019, days after he was impeached by the House of Representatives.

Those gains, however, are now gone, as investors fear the loss of business and jobs thanks to the drastic social distancing measures that have been put in place to prevent the spread of COVID-19, the disease caused by the new coronavirus.

Trump has yet to comment on the stock market losses.

He did, however, comment on a gain a few days ago.

“BIGGEST STOCK MARKET RISE IN HISTORY YESTERDAY!” Trump tweeted on March 14 after the market recovered briefly from an otherwise dramatic loss one day prior.

All of those gains have since been erased.

Published with permission of The American Independent Foundation.

U.S. Shares Steady In Early Trade

U.S. Shares Steady In Early Trade

New York (AFP) — U.S. shares traded fairly flat early Tuesday, appearing to continue taking a breather that started last Friday after a solid one-month run.

But biotech shares got a boost from Vertex Pharmaceuticals (+40.6 percent) after it reported promising results in tests of two drugs for treating cystic fibrosis.

Thirty minutes into trade, the Dow Jones Industrial Average was down 13.52 points (0.08 percent) to 16,923.74.

The broad-based S&P 500 slipped 1.32 (0.07 percent) to 1,961.29, while the tech-rich Nasdaq Composite gained 5.47 (0.13 percent) to 4,374.14.

“By and large, markets look to be consolidating some of their recent gains as the end of the second quarter approaches,” said Patrick O’Hare of Briefing.com.

Facebook led the major companies with a 1.6 percent gain, while Philip Morris slipped 1.6 percent.

On the Dow, UnitedHealth was the biggest gainer, up 0.5 percent.

Blackberry eased 2.2 percent after three days of gains that came on an improvement in the struggling smartphone maker’s finances.

Bond prices rose. The yield on the 10-year U.S/ Treasury fell to 2.60 percent from 2.62 percent, while the 30-year dropped to 3.42 percent from 3.45 percent. Bond prices and yields move inversely.

AFP Photo / Spencer Platt

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TOP CEOs Downgrade Economic Growth Forecasts, Expect To Spend Less

TOP CEOs Downgrade Economic Growth Forecasts, Expect To Spend Less

By Jim Puzzanghera, Los Angeles Times

WASHINGTON — Top U.S. chief executives slightly downgraded their economic growth forecast, according to a survey released Tuesday, and fewer said they expected to increase investments in their businesses amid uncertainty over whether Congress will reinstate some key corporate tax provisions.

Despite those concerns, the second-quarter economic outlook index from the Business Roundtable rose to 95.4 from 92.1 in the first three months of the year, the trade group said.

The index rose because of improvement in CEO expectations for increased sales and hiring in the next six months.

But AT&T Inc. Chief Executive Randall Stephenson, who chairs the organization, said a drop in the percentage of business leaders expecting to increase their capital spending was a major concern.

The decline was driven by the December 31 expiration of some temporary tax provisions, such as a 50 percent bonus on depreciation write-downs and a tax credit for research and development costs.

Congress is expected to extend those measures retroactively, but has not acted yet.

After the economy contracted in the first quarter, CEOs reduced their forecast for annual growth this year to 2.3 percent from 2.4 percent in the previous survey.

The downgrade came after the International Monetary Fund on Monday reduced its U.S. growth projection to 2 percent this year from an April forecast of 2.8 percent.

“CEO expectations for both investment and growth remain well below the potential of the U.S. economy and below what we should be experiencing at this stage of a recovery,” Stephenson said.

He called on Congress to extend the expired corporate tax provisions to remove uncertainty.

“It’s really unclear to the business community when those extenders or if those extenders will get passed, and that’s what I think you’re seeing manifesting itself in this greater pessimism about investment,” Stephenson said.

Photo: Tax Credits via Flickr

Europe Forecasts Stronger Growth; Boost For U.S. Exports Seen

By Jim Puzzanghera, Los Angeles Times

WASHINGTON — European officials on Monday forecast stronger economic growth for the region, a major market for exports from the United States.

The economy of the 28-nation European Union will expand 1.6 percent this year after just 0.1 percent growth in 2013, according to the spring forecast by the region’s executive body. Growth will increase to 2 percent next year, the European Commission said.

“The recovery has now taken hold,” said Siim Kallas, the commission’s vice president.

“Deficits have declined, investment is rebounding and, importantly, the employment situation has started improving,” he said.

The region’s unemployment rate remains high at 10.5 percent as of March, according to Eurostat. the EU’s statistical agency. But that was down from 10.9 percent a year earlier.

The spring forecast projects the rate to remain stable at 10.5 percent this year and then fall to 10.1 percent in 2015.

In contrast, the U.S. unemployment rate dropped to 6.3 percent in April, its lowest level in more than 5 years.

In addition, the European Commission forecasts the U.S. economy to expand 2.8 percent this year and 3.2 percent in 2014.

As the numbers indicate, the European Union has had much more difficulty recovering from the Great Recession.

Debt crises and uneven attempts at austerity have hobbled the region’s economy, which fell back into recession in 2012-13. Monday’s report said the biggest risk to growth was a loss of confidence because of stalled economic reforms.

Europe’s economic troubles have hurt the U.S. economy because the double-dip recession reduced demand for American exports. A pickup in growth in the EU should lead to an increase in U.S. exports.