One of Donald Trump's standard election-season lines encourages people to look at the value of their investments. "The stock market is at an all-time high," the president boasted two weeks ago. "Think of that -- over 50 percent since my election. Fifty percent. People -- the 401(k)s -- and they have 401(k)s, and they were dying with them for years. Now they're so happy."
As it turns out, none of this was included in Trump's rally last night in Wisconsin. It's a safe bet this wasn't a simple oversight.
After yesterday's drops, all of the major Wall Street indexes are in negative territory for the year. On Jan. 1, 2018, for example, the Dow Jones Industrial Average stood at 24,719.22. Yesterday, it closed at 24,583.42.
The recent sell-off in stocks reflects fear that Congress will be remade in the upcoming election and pro-growth policies will fall by the wayside, according to White House advisor Larry Kudlow.Kudlow, speaking to reporters outside the White House on Tuesday, blamed the market decline on the midterm elections. "I think the stock market is worried that Congress will change and will overturn these pro-growth policies," he said. The "correction has to overcome the uncertainty about this election."
It's a classic heads-I-win-tails-you-lose pitch: when the markets go up, it's proof that Donald Trump is a genius; when the markets go down, it's proof that out-of-power Democrats are screwing things up.
To the extent that reality still has any meaning, there is nothing to suggest market drops are related to election "uncertainty." It's far easier to believe recent downturns are related to rising interest rates, Trump's trade war, weaker overseas growth, some unexpectedly sub-par corporate earnings reports, and the president's increasingly over-the-top criticisms of the Federal Reserve.
Some in the White House probably understand this, but blaming the president's political opponents is apparently more satisfying, even if it's wrong.