President Donald Trump on Wednesday weighed in for the first time on wild gyrations in the stock market over the past two weeks, writing on Twitter that the 8 percent plummet over five days amounted to a “big mistake” by investors.
He suggested that the sharp sell-off, particularly on Friday and Monday, came from concerns that the economy was going so well it would lead the Federal Reserve to raise interest rates, putting pressure on future borrowing and growth.
Trump tweeted “In the ‘old days,’ when good news was reported, the Stock Market would go up. Today, when good news is reported, the Stock Market goes down. Big mistake, and we have so much good (great) news about the economy!”
The stock market has risen markedly since the end of the financial crisis in 2009, though it has picked up precipitously since Trump was elected in November 2016. Trump has often sought to tie the stock market’s success to his economic agenda of lowering taxes and stripping away regulations. There are signs that wages are beginning to increase at a higher rate, and job gains have been mostly steady in the past several years.
But there are growing concerns about inflation, and the Federal Reserve is expected to continue raising interest rates, moves that would likely impact investor appetite for stocks. The federal government is also adding hundreds of billions of dollars in debt each year, another factor that is fueling investor concerns.
During the 2016 campaign, Trump called the stock market increase under President Barack Obama a “big, fat, ugly bubble.”
It’s unclear whether the stock market volatility from the past two weeks will continue or smooth out, but the White House is hoping a strong economic picture will help Republicans in the November midterms.
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