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Opinion: Despite stock market drop, economic outlook is bright thanks to Trump

This article originally appeared on on December 5, 2018

The wild gyrations of the stock market have spooked some investors into wondering what lies ahead. All major U.S. stock indexes fell more than 3 percent Tuesday – including a nearly 800-point drop in the Dow Jones Industrial Average – in the worst day for the market in nearly a month.

Some analysts blamed uncertainty over a new U.S.-China trade agreement for the drop. They fear that despite President Trump’s optimism about a beneficial trade deal with China following his meeting Saturday with Chinese President Xi Jinping, a trade war between our two countries could still break out.

In addition, some investors have interpreted the recent phenomenon where short-term interest rates have become nearly equivalent to longer-term 5- or 10- year Treasury bond rates as a potential signal that the Federal Reserve Bank (the Fed) has increased interest rates too much, leading to anxiety about the pace of economic growth.

The stock market was closed Wednesday to mourn former President George H.W. Bush on the day of his funeral. But what lies ahead?

While the market will always have it ups and downs, the most important factor in its long-term performance is the strength of the American economy. And today there’s no question that our economy is booming under Trump administration policies.

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