Mariel Butan had started feeling uneasy about the stock market long before this week’s big string of stumbles. As someone who calls herself “very liberal,” Butan was already struggling to make sense of why stocks had soared to new heights under President Trump. She felt a “big disconnect” between her views of the future and what the stock market was telling her.
But even now — as the market plunged into the red again Thursday, days after some indexes fell by more than 1,000 points — she was hardly feeling any better.
“If the stock market were truly reflecting my faith in Trump as president,” said Butan, who lives in Big Sky, Mont., and works for a nonprofit education organization, “it’d have to dip quite a lot further.”
For liberals across the country, this stock market has been particularly difficult to digest. And the market’s recent shakiness has not been much of a salve. Democrats have seen their confidence in the economy plummet over the past year, while the faith of Republicans has grown, according to Gallup polls.
Some of this is expected. Political views have long colored how people view the economy. Republicans were widely gloomy under President Barack Obama, despite positive indicators. But today the gulf in economic expectations of liberals and conservatives has widened to critical levels, driven by growing polarization and a stock market seemingly determined to defy gravity.
Passions have only been inflamed by Trump’s frequent embrace of the market’s performance via tweets and speeches, something previous presidents rarely did. There is even a new index fund guided by the partisan divide, investing only in companies that support Republicans. Its stock symbol: MAGA.
“There’s an emotional tie with the stock market. It reflects our mood,” said Diahann Lassus, president of the wealth management firm Lassus Wherley in New Providence, N.J.
She has clients on both sides of the political aisle, but she finds it is the liberal ones who have struggled with each record high. Lassus said she sometimes needs to sit them down and remind them, “You can be depressed and still make money.”
But it’s not easy.
Investors opposed to Trump feel conflicted. They don’t like the president, but the stock market has shot up more than 20 percent since his election.
They’re getting richer, but feeling worse.
“I feel guilty about this money,” said Joseph Kelly, who lives in Newtown, Pa., and, along with his wife, is put off by the president.
Yet since Trump took office, they have earned $500,000 in the stock market, Kelly said: “It makes me sick.”
The market was not always so welcoming to Trump. Fears about his presidency started on election night, when stock market futures indicated prices would fall as Trump’s upset win became clear. The downturn never came. Stocks instead launched on an upward tear. Conservative media outlets took joy in pointing out all the commentators who incorrectly predicted a stock disaster if Trump won.
But conservatives were guilty of the same undue pessimism under Obama.
Obama was dogged for years by claims from conservatives that his administration’s attempts to pull the country out of recession were sure to fail. They didn’t. Conservative economists were still warning in 2014 of inflationary doom from low interest rates and the Federal Reserve’s big balance sheet.
Conservative negativity about the economy continued until the 2016 election.
A week before Trump won, just 16 percent of Republicans thought the economy was getting better, a Gallup poll found.
A week after, that number jumped to 49 percent.
Republicans now report their highest level of economic confidence in 13 years.
“My Republican clients — mostly real estate developers and small-business owners — they are very optimistic,” said Danilo Kawasaki, chief operating officer at Gerber Kawasaki, an investment management firm in Santa Monica, Calif.
Kawasaki said he tells all of his clients to “turn off Trump. Don’t pay attention to what he’s doing.” He wants them focused on the economy. And that can be hard to do in the current environment.
In Birmingham, Ala., some clients of Bridgeworth Financial are almost too excited by the current market.
“They view this as the new normal — that we’re going to have higher-than-normal growth rates from now on,” said Zach Ivey, the firm’s chief investment strategist.
Ivey said it can be hard to convince investors that the party can’t continue forever.
“It’s very emotionally charged,” Ivey said.
Partisan passion led Hal Lambert, founder of Point Bridge Capital in Fort Worth, to create an index fund tracking Republican-friendly companies. He ranked the companies in the S&P 500 by how much they gave to Republican candidates in recent elections and then followed the top 150 donor firms. His fund has slightly outpaced the S&P.
In Lambert’s view, this is because “better managed” companies give more to the GOP. And that’s why he borrowed Trump’s “Make America Great Again” slogan — MAGA — for the fund’s ticker symbol.
Some liberals take comfort in arguing that Obama’s policies set the nation on its current, mostly rosy path. They say Trump is only reaping what Obama sowed. And they point out that the Dow jumped by a greater percentage in Obama’s first year in office than Trump’s. But those claims haven’t calmed jitters.
“There is extreme angst, and it really has to do with not trusting the administration and therefore not trusting the market,” said Jennifer Hatch, president of Christopher Street Financial, a New York financial planning firm that specializes in LGBT clients.
Hatch’s mostly liberal clients have not had an easy time keeping their money in the market.
“I’m doing more hand-holding now than ever, assuring them we are well positioned for corrections or disaster,” Hatch said.
The gulf between people’s moods and the mostly positive economic outlook, she said, “it’s a real schism.”
It’s been hard for some clients of Boston-based Zevin Asset Management, which deals with many foundations and religious organizations.
“There is some dissonance they feel around the gain in their portfolio right now,” said Pat Tomaino, the firm’s director of socially responsible investing.
Tomaino said the market’s rally was built on the expectation of tax cuts and reduced regulation under Trump’s administration, “and a lot of that has regrettably played out.”
But Tomaino pushed back against any “liberal guilt” over the market’s gains.
“This is a moment of truth for folks who consider themselves progressive and have money in the markets,” he said. These investors should use their holdings and money to advocate for change.
Butan had another idea. She said she would gladly give back the money she has earned from the recent “ridiculous” stock returns in exchange for “modestly good” ones, just to feel better about the country’s direction.
That’s a trade she said she would make.
“I feel guilty about this money.”
Joseph Kelly of Newtown, Pa. He and his wife are put off by President Trump.Yet since Trump took office, they have earned $500,000 in the stock market.