‘Good news’ visit hit by market rout
UNITED STATES: US President Donald Trump promoted ‘‘a tidal wave of good news’’ on the American economy yesterday as US stocks plummeted in the second day of a selloff.
Stocks plunged the most in more than six years, with the Dow Jones Industrial Average closing down 1175 points. At one point during Trump’s speech at a Cincinnati-area manufacturer, the Dow was down 1597 points.
Trump has often boasted of the surge in US stocks since his election, but he didn’t mention the market during his speech at Sheffer Corp, a factory in Blue Ash, Ohio.
Though the Dow and the broader S&P 500 are now down for the calendar year, US stocks are up since election day. The Dow rose more than 25 per cent last year.
The television in Air Force One’s boardroom is usually turned to Fox News, but when White House staff boarded the plane after Trump’s speech, the network was broadcasting a red chart illustrating the market decline. Aides turned it off.
Treasury Secretary Steven Mnuchin later approached the press cabin. He waved off questions about the market and insisted that Fox News had been on throughout the flight.
Trump spent part of the flight talking with Republican Ohio Senator Rob Portman, Mnuchin and senior adviser Stephen Miller and was in good spirits, aides said.
‘‘The president’s focus is on our long-term economic fundamentals, which remain exceptionally strong, with strengthening US economic growth, historically low unemployment, and increasing wages for American workers,’’ White House press secretary Sarah Huckabee Sanders said after the plane landed.
‘‘The president’s tax cuts and regulatory reforms will further enhance the US economy and continue to increase prosperity for the American people.’’
Trump told workers at the factory that the Republican tax overhaul had ‘‘set off’’ a wave of favourable economic news. He cited a commitment Apple announced in January to invest US$350 billion in its US operations, and also lauded the bonuses some companies have given workers since the tax overhaul was passed by Congress. Trump had sought to highlight companies that had doled out employee bonuses and raises, citing the tax cuts as the reason, White House aides said.
Four corporate chief executives, each of whom paid their employees US$1000 bonuses, were at the Ohio event.
The event was the president’s second day trip to advance the GOP tax bill he signed in December, and his third visit to Ohio since taking office. He visited a bellwether voting district in western Pennsylvania last month.
Meanwhile, America’s lawyers are preparing for an increase in divorces this year thanks to the tax reforms.
For the past 75 years, maintenance payments, or alimony – the money a court typically orders a higher-earning spouse to pay to their former partner – have been tax-deductible. The arrangement has angered religious conservatives, who say it acts as an incentive for couples to divorce.
Under the reforms, the tax break will end for agreements finalised after December 31 this year, leaving lawyers handling a wave of panicky, unhappily married clients.
If Trump is paying maintenance to his two former wives, he will still be able to benefit from the tax break, as will anybody who hammers out an alimony deal before the end of this year.
– Bloomberg, The Times