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Home / Business / Dow crashes on the worst Christmas Eve for stocks in history as Trump accuses the Fed

Dow crashes on the worst Christmas Eve for stocks in history as Trump accuses the Fed



<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Dow crashes in the worst case Christmas Eve for the holdings in the story, when Trump's debt originally appeared on abcnews.go.com "data-reactid =" 15 "> Dow collapses on Christmas Eve's worst for holdings in history, while Trump originally accused the Fed abcnews.go.com

The Dow Jones Industrial Average plunged more than 650 points Monday – the country's worst Christmas Eve meeting in the country's history – according to experts – after buzzing statements by the Treasury, an escalating trade with China and an economic slowdown.

Stock prices are negative for the year, and the Dow has dropped by thousands from its peak of nearly 27,000.

The Dow ended the day with a dramatic drop of 653 points at 21,792, a shortened trading session before the Christmas break, a decline of nearly 10 percent from a week earlier. The day's losses of 2.9 percent, which added to the previous week's 6.8 percent, set the stage for last week's trading.

"I think it was the worst December 24th in history," said US Global Investors dealer Michael Matousek told ABC News. "There has not been a worse Christmas Eve since I started in the industry 22 years ago."

Last week was the worst in ten years – since the financial crisis of 2008. This month is currently well on its way to ending the worst December since the Great Depression.

The tech-heavy NASDAQ also suffered and ended the day at 6,193 more than 5 percent. It entered the bear area last week for the first time since the 2008 recession, more than 20 percent below its record high of 29 August.

PHOTO: An image of President Donald Trump is on a computer on the floor of the New York Stock Exchange New York (24 December 2018) to see (Seth Wenig / AP)

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President Trump repeated his attack on the Federal Reserve, which has become foreseeable after bad performances of the stock market, on which the president concentrates rather than other economic indicators.

"The only problem is our e Conomy has the Fed, they have no sense of the market," Trump tweeted. "The Fed is like a mighty golfer who can not score because he has no points of contact – he can not putt! "

The central bank raised interest rates last week in an expected Movement of 0.25 percent The bank published a less positive forecast than expected and forecast a slowdown in the economy.

Trump has consistently cracked interest rate hikes and defeated its chairman Jerome "Jay" Powell. The Wasington Post and other news media report on Trump Mnuchin for suggesting Powell for this job.

Markets Moving Down Tweet Trump's tweet would try to fire Powell, which heightened market instability and concerns about central bank independence.

However, the markets' recent slowdown in performance has largely been attributed to the policies of the White House.

PHOTO: Traders work on the floor of the New York Stock Exchange in New York, December 21, 2018. (Bryan R. Smith / Reuters, FILE)

Over the weekend, Mnuchin tweeted that he called JP Morgan Chase's CEOs, Bank of America, Goldman Sachs, Morgan Stanley, Wells Fargo, and Citigroup from his vacation in Cabo San Lucas, Mexico. His agency is one of the federal departments affected by the current closure of the government. Others in the Ministry of Finance are forced to say home without pay. It is unclear whether Mnuchin went on vacation in a government plane.

The bank directors assured the secretary that "they have sufficient liquidity to lend to consumers, business markets and all other market operations". Mnuchin wrote:

"They had no problems with the release or margin and the markets continue to function properly," he added.

Mnuchin's comments seem to appease investors, economists and traders that this would not be the case for a run on banks that triggered the latest crisis.

The message may have had the opposite effect, as it was not a concern of market watchers until its tweet.

"If that were not the end In December, I'd have thought it was April fools," said Jared Bernstein, former chief economist of Vice President Joe Biden, to the Washington Post: "Markets are already nervous enough Space signs can intercept incoming asteroids. I did not know it came to us. "

Market watchers, who were generally optimistic, voiced concerns about the panic that Mnuchin's comments, along with the general instability in the White House, could ignite. 19659032] "My guess is that Trump's Mnuchin has been pressured to do something," and that half-way attempt to calm markets is the result. Timothy Duy, an economics professor at the University of Oregon and author of the influential Fed Watch blog, wrote to ABC News in an email.

"Mnuchin apparently believed (of course, speculation) that easing fears of a financial crisis could support the stock market. But that's not a serious fear at this point, "Duy said, adding that traders are being shaken by trade wars, political uncertainty, and a weakening economy, as many experts expected.

" Mnuchin has created a fear which is actually not an up to date issue, and thereby creates the perception that it knows about a problem that no one else knows about, "added Duy." Such a thing can trigger a financial crisis as market participants stop fearing the unknown to buy something and the financial institutions stop lending each other. "

PHOTO: Finance Minister Steven Mnuchin speaks to the news media after a television interview at the White House in Washington, December 3, 2018 (Leah Millis / Reuters, FILE))

Many experts pointed out that the panic from the Minister of Finance's statements could affect the banks, which had a major impact on the global economic crisis. It is widely believed that the banks are in order.

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"A run on the banks is when people are afraid that money will not be liquid. So they start withdrawing money, like Lehman Brothers, so they had to go to the Fed for extra money, which is essentially a bailout, "Matousek said.

"There is a difference between now and then because we did not have any stress tests like this," Matousek added. "We have so much stress testing, they are so regulated, when I saw that he called the banks, that I'm only told that the administration is a little unsure what's going on."

Duy added that although Mnuchin's comments on this were highly unusual, "it is generally believed that Mnuchin's actions were so poorly designed that they can not be taken seriously, but they were so bad that they had a worrying flaw This implies uncertainty that undermines investor confidence. "

The New York Stock Exchange (NYSE) was closed on Monday at 13:00 ET. On Tuesday it is closed for Christmas.


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