On Monday, the Dow Jones stock market index fell a record 1100 points. It was more than a four percent loss in the Dow, marking the first steep decline we’ve seen since months and years of gains in the stock market.
The decline renews some fears with the Great Recession still fresh in all of our minds.
Will the market continue to fall? Will the fallout impact the economy?
The stock market was due for a correction, but how long will this correction last?
Greg David is director of Business Reporting Program and director of the Ravitch Fiscal Reporting Program at CUNY Graduate School of Journalism in New York. He says it’s difficult to say right now where the stock market is headed.
“The great bull market we saw beginning in 2009 may be over,” he tells Detroit Today host Stephen Henderson.
“The most important thing to remember is the stock market is not the economy.”
David says though the dip was large in number of points, it was not the biggest dip in percent of the stock market in a single day. The crash known as “Black Monday” in 1987 saw a drop in the Dow of 508 points. That was a 22.6 percent drop in the Dow, which sank to 1739 points.
David says President Donald Trump put himself in a precarious position by taking credit for the rapid gains in the stock market we’ve seen in recent months.
“Presidents before Trump have stayed away from taking credit for the stock market, because what goes up must come down,” says David. “But he’s broken every other rule, so why not this one?”
To hear more from David on Detroit Today, click on the audio player above.