United States President Donald Trump on Tuesday announced via Twitter that he has told his representatives to stop negotiating with Democrats in Congress over a new round of coronavirus relief aid until after the November 3 election.
Trump accused the Democratic leader, House Speaker Nancy Pelosi, of “not negotiating in good faith”, announcing: “I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business.”
In his series of tweets, Trump said he had instructed Senate Majority Leader Mitch McConnell “not to delay, but to instead focus full time on approving my outstanding nominee to the United States Supreme Court, Amy Coney Barrett.”
“Our Economy is doing very well,” Trump added. “The Stock Market is at record levels, JOBS and unemployment also coming back in record numbers. We are leading the World in Economic Recovery, and THE BEST IS YET TO COME!”
But stocks took a nose dive following Trump’s announcement, with the Dow Jones Industrial Average down more than 375 points, or 1.34 percent, by the closing bell. The broader S&P 500 – a proxy for US retirement and college savings accounts – was 1.4 percent in the red, and the Nasdaq Composite Index fell 1.57 percent.
Trump’s announcement fell just hours after Federal Reserve Chairman Jerome Powell said that the US economic recovery is in danger of faltering without more government aid.
In a virtual address to the National Association for Business Economics, the Fed chief warned: “Too little support would lead to a weak recovery, creating unnecessary hardship for households and businesses.”
Pelosi fired back at Trump in a statement, echoing Powell’s warnings and adding: “Clearly, the White House is in complete disarray.”
The House Speaker also accused the president of “putting himself first at the expense of the country, with the full complicity of the GOP Members of Congress” and said Trump “refuses to put money in workers’ pockets, unless his name is printed on the check.”
A slew of data – from initial claims for unemployment benefits to consumer spending and income to job creation – is signalling that the US economic recovery is shifting into low gear.
That deceleration is attributed by many economists to the waning effects of nearly $3 trillion in federal virus relief aid that Congress passed in March and April.
The $600 federal weekly top-up to state unemployment benefits expired at the end of July. Layoffs remain stubbornly high, and many workers who were furloughed are finding that their job losses are becoming permanent.
And though the nation’s unemployment rate fell from a pandemic high of 14.7 percent in April to 7.9 percent in September, it is still far from February’s rate of 3.5 percent.
While the real economy has a lot of ground to make up to recover its pre-pandemic strength, Wall Street has powered ahead to overcome losses from earlier in the year and stage new highs.
But Trump’s announcement on Tuesday landed on Wall Street like a gut punch, sending the major stock indexes down sharply.
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