business
The Stock Market's Wild Ride...
Feb 7, 2018 at 04:34 AM
Photo by pixabay

Food For Thought

Should recent market volatility be a cause of concern? What, if anything, does it indicate about the state of the U.S. economy?

Share this Topic

Why It's Relevant

Over the past few days, stock markets has taken a significant hit. Last Friday, market indexes began falling sharply and then, things got worse. On Monday, the Dow Jones Industrial Average (DJIA) fell more than 1,100 points which represents the worst single-day point decline in its history. The S&P500 fell 4.1%, the worst percentage drop in six years.

While there is no broad consensus on a single trigger that led to the market sell-off, some experts suggest that concerns over future interest rate increases may have played a role.

Stocks rebounded slightly on Tuesday, with the S&P gaining 1.7% and the DJIA gaining 2.3%. 

Food For Thought

Should recent market volatility be a cause of concern? What, if anything, does it indicate about the state of the U.S. economy?

Share this Topic

The New York Times

Has Trumphoria Finally Hit a Wall?

Paul Krugman
View Original Article
Our Article Commentary

This opinion from Paul Krugman was classified as a view from the left because it contained these types of arguments:

  • It is very difficult to use market fluctuations to predict future economic movement. That said, recent market turmoil serves as a good reminder to take a "hard look at the economy's prospects".
  • There are good reasons to believe that US economic growth will slow to around 1.5% (about half the rate of the 3% growth promised by Trump). Additionally, there are indications that assets are overvalued.
  • Slow growth and high asset values alone wouldn't be catastrophic if we could trust policymakers to react in an effective manner. However, with a new, unproven Federal Reserve chair and a highly uninformed Secretary of the Treasury, these trends could lead to big trouble.
  • agree
  • disagree
  • hmmmm...
Politico Magazine

Why Presidents Shouldn’t Talk About the Stock Market

Jason Furman
View Original Article
Our Article Commentary

This view in Politico Magazine was classified as a view from the mid-left because it included the following types of arguments:

  • Early in his first term, former President Obama made the mistake of commenting on the stock market and he was quickly ridiculed as the "stock-picker in chief". After that blunder, Obama tended to avoid commenting on day-to-day market fluctuations.
  • By contrast, President Trump has a habit of tweeting whenever the Dow reaches a new milestone and his top economic advisers even went so far as to predict increases in the stock market.
  • A President's actions have a very "limited and indirect" impact on the stock market and the broader economy. Presidents should not try to claim credit when the markets are up, and they should not be blamed when the markets go down.
  • agree
  • disagree
  • hmmmm...
The Conversation

Three reasons not to worry about the stock market ‘crash’

Arturo Bris
View Original Article
Our Article Commentary

This opinion from Arturo Bris was classified as a view from the mid-right because it expressed these types of sentiments:

  • This week's market sell-off is not all that uncommon of an occurrence. In fact, between 1987 and 2018, the Dow has suffered similar declines of 4% or more 37 times.
  • The most worrying market crashes are those that are precipitated by a major geopolitical or economic event but there was no real news driving this sell-off.
  • Most importantly, the fundamentals of the economy still look solid. Across the world, economic growth rates are strong, corporate earnings are excellent, and assets don't appear to be irrationally overvalued.
  • agree
  • disagree
  • hmmmm...
The Washington Times

Terror on Wall Street

Editorial Board
View Original Article
Our Article Commentary

This editorial in the Washington Times was selected as a view from the right because it included these types of arguments:

  • The huge market sell-off this week was likely triggered by the positive jobs report that was just released.
  • For most Americans, news of low unemployment and strong wage growth is great. However, for some institutional traders, this news created fears that interest rates and inflation will rise in the near future.
  • President Trump is delivering on his promises to working-class Americans. These workers are celebrating our strong economy and wage growth instead of feeling jittery about short-term stock market fluctuations.
  • agree
  • disagree
  • hmmmm...
Click a square to view opinions.
Liberal
Conservative