Is Trump to Thank for the Dow Hitting 23000? – The Atlantic

Presidents, in general, do not have much control over the behavior of the markets. They help construct broad economic guidance, which can, in turn, shape how confident companies and investors are about their ability to turn a profit—sending the stock market up or down. But those changes are hard to directly attribute to his actions—that is unless the president says or does something especially extreme. And most presidents try pretty hard to avoid precipitating major market movements, though Trump has bragged about his perceived ability to tank stocks more than once, such as a tweet last week where he cheered a slump in health insurance stocks on the news that the government would stop paying subsidies for low-income individuals.

For example, though the stock market rose significantly during the Obama years, it’d be hard to make the case that those gains were the result of Obama specifically and not the policy decisions by the Federal Reserve, which kept interest rates low, pushing investors toward the stock market instead of bonds. Those rates remained historically low through the end of Obama’s tenure, and the start of Trump’s.

Trump’s claims that his presidency is responsible for the market’s trajectory is further complicated by what occasionally seems to be a misunderstanding of the relationship between the stock market and the federal government. In an interview with Sean Hannity, the president suggested that the $5.2 trillion gains in the stock market could help chip away at the national debt, “You can say in one sense we’re really increasing values; and maybe in a sense we’re reducing debt.” But growing corporate profits have very little to do with the amount of money owed by the federal government. In theory, increased profits could mean more tax revenue coming in from thriving businesses—but Trump also has plans to cut the corporate tax rate. The White House went on to clarify, saying that Trump “was simply making the point that we’ve seen enormous growth in the stock market since his election, that means more money in the pocket of everyday citizens, and more circulating in our economy as a whole,” according to several outlets.

Still, Trump’s obsession with touting stock market gains as a personal victory seems an odd choice given the fact that—at some point—the market is all but guaranteed decline. Then what?

That’s likely not a question that Trump or his administration will lose much sleep over. This pattern, of claiming victories and dismissing defeats as the responsibility of someone else—usually Obama—is an obvious one at this point. Trump has used the same tactic when it comes to other matters of economic concern, including jobs and unemployment. When the stock market finally does tick down, it’s sure to be someone else fault. Trump, for his part, will find other “wins” to tout.

Is Trump to Thank for the Dow Hitting 23000? – The Atlantic

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