Trump’s economic “rocket fuel” blows up
by digby
Tying the Dow to presidential performance is always ridiculous. It operates on its own logic and presidents take office dealing with economic environments that have nothing to do with them.
But live by the sword, die by the sword:
President Trump was up early one year ago and, in short order, picked up his phone. The night prior, the Dow Jones industrial average had closed at 24,792.20, a record high. Trump tweeted a celebration.
The Senate was poised to pass tax cuts that Trump had pledged would serve as “rocket fuel” for the economy. In a follow-up tweet, he made a similar pledge.
“Stocks and the economy have a long way to go after the Tax Cut Bill is totally understood and appreciated in scope and size,” he wrote. “Immediate expensing will have a big impact. Biggest Tax Cuts and Reform EVER passed. Enjoy, and create many beautiful JOBS!”
For a few more months, it seemed as if Trump’s embrace of the markets and the tax cuts had paid off. Between mid-December 2017 and early February, the Dow surged more than 1,000 points. And then things got bumpy.
As of writing, both the Dow and the S&P 500 are down for the year. For as good as Trump’s first year was — and, in terms of market expansion, it was good — his second year hasn’t been that great. In fact, it’s poised to be one of the worst second years for any president in the history of the Dow in terms of points.
The only one that has been worse? 2002, George W. Bush’s second year in office.
The best second year? Barack Obama’s.
boom.
But again, look at the environment in which both of those presidents were working: 9/11 and the Great Recession. And let’s be honest. “Points” is an irrelevant metric. It’s percentage that illuminates performance.
Still, that GOP tax cut “rocket fuel” blew up before it left the ground. And the Dow is volatile and going nowhere, just like him.
Trump takes credit for the sun coming up in the morning and blames Hillary when it goes down at night so all of his bragging and blaming is just plain stupid anyway. But his only real claim to the presidency was his alleged magical touch with money. (And yes, we know he’s a conman who actually bankrupts everything he touches.)
It will be interesting to see how Trump’s wealthy benefactors deal with this. You’d think they’d be worried that his dumpster fire of a trade war is only going to make everything worse but I suspect they will remain worried enough about losing their precious tax cuts that they’ll stand by their man no matter what.
The fact is that they might be smarter than he is in most ways but 2007 proved that they are just as selfish and unwise. Their greed will kill the golden goose yet.
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