The distracting shiny object: S&P ups and downs
For anyone who gets their economic news from cable TV, we're in the craziest period of the Trump presidency so far.
Driving the news: The S&P 500 fell by 3.4% last Monday, Feb. 24. It then fell another 3% the following day, and it fell by 4.4% on Thursday Feb. 27. This week, it rose 4.6% on Monday, fell 2.8% on Tuesday, and rose 4.2% on Wednesday. It's entirely possible we'll see another 3%+ swing today.
Making matters worse: With the market still near all-time highs, a 3.7% intraday swing in the Dow corresponds to a 1,000-point move.
- That's guaranteed to generate banner headlines — and freak out boomers who still think of 1,000 Dow points as being a major milestone.
How it works: The Trump administration explicitly uses the stock market as a barometer of its success, and the coronavirus was a large part of the reason for the recent stock-market volatility. Those factors explain why Treasury Secretary Steven Mnuchin and National Economic Council director Larry Kudlow were appointed to the government's coronavirus task force.
The bottom line: So long as the stock market remains volatile, expect Trump to fixate much more on the Dow than he does on CDC mortality reports.
Go deeper: How Trump’s economy stacks up