No achievement is too small for President Donald Trump to tweet about.
On Thursday morning, he bragged about the stock market being on the “longest winning streak in decades.” Trump repeated this assertion at a press conference in the afternoon at the White House in Washington, D.C.
The fact behind Trump’s assertion is that the three main stock market indices – S&P 500, the Dow Jones Industrial Average and the NASDAQ – have each hit new highs five trading days in a row. However, Trump’s take fails to give the whole picture.
The U.S. is in the midst of a long stock market boom – the S&P 500 has risen almost three-and-a-half times since the depths of the 2008 financial crisis. But almost all of those gains were under President Barack Obama, and because stock ownership is massively unequal, it’s a boom that huge swathes of American’s never took part in.
Under the Trump administration the stock market’s logic has been blinkered by the president’s promises. Trump is moving to cut financial regulations, so bank stocks have zoomed higher. He also wants to cut corporate taxes and allow companies to bring overseas cash back at a likely discounted rate, which will boost profits and enable companies to pay bigger dividends and buy back stock.
That’s fantastic news, but only in the short term and only if you own stocks, which almost half of Americans don’t. Even more important, stock ownership is incredibly unequal: The top 10 percent of the richest Americans own 80 percent of the stock market and the next 10 percent owns just 11 percent. Those stats come from the Federal Reserve’s 2013 Survey of American Consumer Finances and calculations by welfare expert Matt Bruenig.
Of course, it’s not news that the stock market in and of itself is an incomplete gauge of broad economic well-being: While the stock market has boomed in recent years, middle class incomes have dropped since 1999.
Indeed, Trump’s own election was in part a sign of frustration at the decades-long trend of income stagnation for U.S. families, while the top 1 percent’s wealth boomed in the wake of the financial crisis and bailouts.
The stock market doesn’t seem to have considered that a massive infrastructure bill is unlikely to happen (a set of tax breaks for private projects is more likely), a trade war is a very real possibility, while restrictive and hastily written immigration orders are already a proven priority of Trump. The new administration has yet to face a crisis not of its own making.
In other words, the stock market is treating the Trump administration like a diner who sits down for a three-course meal and pretends like desert is the only thing on the menu.
In the short term, taking credit for a booming stock market is probably an urge that’s impossible for any president to resist ― many of Trump’s predecessors did. Longer term, however, it can’t mask real concerns about cleaving economic inequality and slow or no income growth for for ordinary Americans.