There are two types of numbers in the world of President Trump: numbers that prove how good he is as president and numbers that don’t exist.
During the campaign, this took the form of polling. During the Republican primary, Trump would often bring the latest poll numbers with him to rallies and regale audiences with lengthy articulations of what percentage he had, what percentage Jeb Bush had and so on down the line. It was clear that he enjoyed the validation those polls offered. A candidate insistent on his own excellence could point to polls and, in the style of Sally Field, see that America (or Republicans, at least) really liked him.
Had Trump only had to run against Bush for the rest of his career, we’d be hearing about poll numbers still. But winning the Republican nomination meant running against Hillary Clinton, whose poll numbers were consistently better than Trump’s. He was left occasionally talking about questionable polls that showed him with a lead or more reputable ones that showed him closing the gap.
It didn’t get better on Election Day, when he lost the popular vote by almost 3 million votes. (Instead of talking about that, Trump usually talks about his 304 electoral college votes, which he has in the past dubbed an “impossible” feat.) Once he was inaugurated, his approval dropped into the 30s, where it has generally stayed. Sometimes he’ll tweet about a slightly better approval poll, but not often.
So most of 2017 was spent celebrating a number that just kept going up and up: the stock market. The Dow Jones industrial average was soaring, Trump was tweeting, and all was well. Each day the market was up was a good day for Trump, and he missed few opportunities to make that case to the public. The Dow’s gains were even maybe reducing the federal debt somehow; who knows?! All was well.
And then it wasn’t.
On Friday, the Dow fell 666 points, the sixth-worst plunge in its history. The Standard & Poor 500 fell about 60 points, a smaller drop as a function of its value but still a bad day for the index. Trump, true to form, was mum about the drop.
On Monday, an even sharper fall. The Dow closed down 1,178 points, the biggest single-day fall in the average’s history. The S&P dropped about 113 points — its largest drop, too. The Dow closed 8.5 percent off its all-time high, and the S&P off 7.8 percent. The two-day fall was the worst in Dow history and the fourth-worst in the S&P’s.
More frustrating for Trump? The Dow has now given up a third of the gains it’s seen since he was inaugurated and more than a quarter of the gains it’s seen since the election. The S&P’s drop was more severe, losing 37 percent of the gains since inauguration and 31 percent of the gains since Nov. 8, 2016. Both are still up since Trump took office, but the recent trend does stand out.
See if you can spot the past two days on this graph.
By Feb. 5, 2010, the Dow had gained 26 percent under Barack Obama. Trump was on track to beat that easily — until the past two days of trading.
Everyone saw this coming. Stock markets don’t go up forever. Markets often go down, occasionally spectacularly. Trump’s constant insistence on the strength of the markets being a positive reflection of his presidency meant that, inevitably, it would be noted when the markets dropped significantly. His political opponents easily teed up. A no-brainer.
Former Obama press secretary Jay Carney:
Good time to recall that in the previous administration, we NEVER boasted about the stock market — even though the Dow more than doubled on Obama's watch — because we knew two things: 1) the stock market is not the economy; and 2) if you claim the rise, you own the fall.
— Jay Carney (@JayCarney) February 5, 2018
It’s worth remembering the broader context here. The Dow’s biggest single-day fall comes when it was near its highest value — meaning that, as a percentage of the average, the fall wasn’t the largest. It’s the second-biggest drop as a percentage of value since 2009 and the 102nd-biggest in history. There have been 192 days during which the S&P has seen bigger single-digit falls in the percentage of its price. Even over the past two days, the declines as a percentage of market value are more modest. For the Dow to have seen a record fall in percent of market value, it would have needed to fall more than 5,770 points. So: It could have been worse.
From a political perspective, Carney’s right. The Dow, like an approval poll, is a very iffy thing to celebrate each time it goes up. It’s very Trump to champion short-term increases in the market, sure, and very Obama to stoically nod at long-term increases in private. But just because those responses are in character doesn’t mean that Obama’s strategy wasn’t better.
It was better.
With the notable exception that Trump operates by different personal and political rules. Constant reversals of even some of his most fervently asserted positions have elicited little more than shrugs from many of his supporters and don’t seem to have fazed him much, either. Supporters will note — correctly — that the markets are still up during his presidency, and many will take from that the lesson that Trump intended all along: that he is an exceptional manager of the American economy.
The Dow isn’t the economy, and Trump’s ability to move either of those things at his will is certainly debatable. But if you are inclined to think that things Trump does are great, you will probably still think that Trump’s handling of the economy is great no matter what the Dow does.
Trump, for one, is so inclined.