We have had a volatile few weeks in the markets…..up….down….up again…..down again…..
Just the other day the markets went up then down 2000 pts and then up 1000 then down another 1000…..markets are waiting for Trump to do something to off-set the market losses…..
US stocks slid on Wednesday as investors mulled the timeline for the White House’s stimulus measures in response to the coronavirus outbreak.
All three major indexes tanked roughly 5%, erasing gains made during Tuesday’s rebound. The drop ushered in another day of heightened volatility from coronavirus risks and the escalating oil-market war between Russia and Saudi Arabia.
Investors initially expected stimulus details to be announced Tuesday. Markets surged through the previous session amid reports that President Donald Trump wanted to cut payroll taxes through the November election. The fiscal stimulus would join the Federal Reserve’s early-March monetary-policy boost.
Trump’s ace in the hole for the election is the good economy……and with the virus crapping all over his rep as an astute businessman…..he may decide to do something to help and to improve his chances for the next election….
President Trump on Tuesday proposed eliminating the payroll tax until the end of the year to mitigate the effects of the coronavirus. A few different timelines were discussed during a closed-door meeting with Republican lawmakers, with some talk of the rollback stretching beyond 2020, officials tell NBC News, adding Trump favors a cut that would last at least until November. Payroll taxes are paid by employers and employees to fund Social Security and Medicare. Employees pay 6.2% on the first $137,700 of their income for Social Security, and 1.45% of all their earned income for Medicare, with employers matching those amounts. Under the Obama administration, the Social Security payroll tax was temporarily cut to 4.2%, per CNN. The idea of a 0% payroll tax rate is reportedly being met with resistance from Republican senators, per CNBC.
Officials tell the Wall Street Journal that the April 15 tax deadline is also likely to be extended, though a specific date hasn’t been decided, nor is it clear who would qualify for the extension. Republicans also discussed federal assistance for the shale oil industry, which is suffering as a result of a price war between Russia and Saudi Arabia. “They are talking about specific industries that would be hurt the worst and to try and get first of all this payroll tax deduction,” GOP Sen. David Perdue of Georgia tells NBC. “That’s at the top of my list as having immediate impact,” but “if you’re not getting paid, that doesn’t help.” Any economic stimulus plan would need to be approved by Congress. House Speaker Nancy Pelosi said Tuesday that Democrats were working on a plan of their own.
Something needs to be done to calm the nerves of the profit takers…..but is the proposed plan anything but a secret attack on Social Security?
Economists and progressive advocacy groups are warning that President Donald Trump’s proposal to cut or temporarily suspend the payroll tax in an effort to mitigate the economic impact of the coronavirus is “a Trojan Horse attack on our Social Security system” that will do little to help most U.S. households.
Slashing the payroll tax, the primary funding mechanism for Social Security, “is the wrong way to go,” said Dean Baker, senior economist at the Center for Economic and Policy Research (CEPR).
But do not worry the president went on national TV to calm the frayed nerves…..and it did not go so well…..
President Trump announced a 30-day ban on travel to the US from Europe Wednesday night—but the anti-coronavirus move did not reassure the stock market. CNN reports that Dow Jones futures plummeted more than 1,000 points overnight, setting up another day of stock market carnage Thursday, the day after a 1,465-point plunge officially ended the 11-year bull market. Asian markets also saw major falls Thursday, and European markets suffered in early trading, with Britain’s FTSE 100 down 5.7% to 5,542.17. Analysts say investors were dismayed by Trump’s failure to set out a comprehensive medical and economic response to the outbreak and its effects. More:
- Travel ban clarified. Trump initially said all travel from Europe—excluding the UK—would be suspended for 30 days, but officials later clarified that the ban only applies to foreign nationals who have been in the 26 Schengen Area countries that allow passport-free travel between each other, the AP reports.
- Britain won’t follow suit. Authorities in Britain say they won’t copy the US ban on flights from the European Union, the Guardian reports. “With regard to flight bans we are always guided by the science as we make our decisions here,” health secretary Matt Hancock said Thursday. “The advice we are getting is that there isn’t evidence that interventions like closing borders or travel bans are going to have a material effect on the spread of the infections.”
- EU condemns move. The European Commission slammed Trump’s move in a statement Thursday, reports the New York Times. “The coronavirus is a global crisis, not limited to any continent and it requires cooperation rather than unilateral action,” the EU’s governing body said. “The European Union disapproves of the fact that the US decision to impose a travel ban was taken unilaterally and without consultation.”
- Airlines hardest hit. The Wall Street Journal reports that airlines and cruise ship operators have been the hardest hit by pretrading drops, with America Airlines, Delta, and United all down at least 10%. Analysts say that with the full effect of the virus and containment measures on the world economy still largely unknown, markets may remain volatile for weeks to come.
Sorry but the markets are not showing much faith in the proposals by this president….and today’s opening shows the lack of confidence in the president…..
The market is cratering at the open, and it happened so fast that trading was suspended for the second time this week. The Dow fell more than 1,700 points, about 7%, after another string of worrying coronavirus developments. The benchmark S&P fell 7% as well, and that triggered a 15-minute “circuit breaker” pause in trading, reports CNBC. The plunges come after the Dow slipped into a bear market Wednesday after 11 years of a bull run. On Thursday, the S&P also entered a bear market.
Meanwhile, the New York Stock Exchange is exploring the unprecedented step of closing its trading floor and switching to electronic backup systems, reports the Wall Street Journal. The move comes amid a push to discourage large gatherings of any kind as a way to curb the spread of the disease.
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