Just a week ago, President Donald Trump hailed the state of the stock market during his first State of the Union address.
“The stock market has smashed one record after another, gaining $8 trillion in value,” he said.
But Monday, as Trump touted the GOP-passed tax bill and the economy at a factory in Ohio, the stock market was in a free fall. The Dow Jones industrials plunged, ultimately closing down more than 1,150 points, the largest single-day slide.
No economic indicator has been as central to Trump’s economic messaging as the stock market. But with the market trending downward, at least in the short term, the White House is now seeing the risk of dwelling so much on a volatile metric.
"There are dangers wedding yourself to any one economic indicator,” a former Trump administration official said Monday. “When you aim to own the highs you get to own the lows too."
On stage in Cincinnati, Trump largely ignored the market, even as cable news networks bracketed his speech with alerts about the Dow. "Your paychecks are going way up," he told factory workers. "Your taxes are going way down. And right now, for the first time in a long time — and you've seen it — factories are coming back. Everything is coming back. They all want to be where the action is. America is once again open for business. Right?”
Most TV networks, including Fox News, cut away from Trump's speech to special reports about the stock market, showing the numbers fluctuating downward — completely overshadowing the president's event.
White House press secretary Sarah Sanders responded to the stock market dive in a statement after Trump’s speech. “The President’s focus is on our long-term economic fundamentals, which remain exceptionally strong, with strengthening U.S. economic growth, historically low unemployment, and increasing wages for American workers,” Sanders said. “The President’s tax cuts and regulatory reforms will further enhance the U.S. economy and continue to increase prosperity for the American people.”
And White House deputy press secretary Raj Shah previously downplayed the effect of the stock market on the president's messaging before the event.
"Look, markets do fluctuate in the short term," Shah told reporters on Air Force One on the way to Ohio. "We all know that. And they do that for number of reasons. But the fundamentals of this economy are very strong and they're headed in the right direction — for the middle class, in particular."
Shah pointed to Friday's jobs report, low unemployment numbers, and bonuses and raises that some companies have announced over the last two months. "We're very excited about the strength of the economy."
Trump, though he has often also brought up the unemployment rate, has spent much of his presidency fixated on the market.
“The stock market has hit record numbers, as you know, and there's been a tremendous surge of optimism in the business world, which means something different than it used to,” Trump told reporters at his first press conference as president last February.
His view of the market as it rallied over the last year, and how he sold it to voters, only became more explicit. “The reason our stock market is so successful is because of me,” the president said on Air Force One in early November. “I’ve always been great with money, I’ve always been great with jobs, that’s what I do. And I’ve done it well, I’ve done it really well, much better than people understand and they understand I’ve done well.”
But taking credit has raised questions about how exactly he’ll handle the plummet.
The former Trump administration official argued that the drop over the last several days shows that the president has to make his economic pitch "broader than just the stock market" because "strong economies are full of paradoxes."
"Last week we had a strong jobs report with solid wage growth, but that created a conversation about interest rate hikes that helped cause Friday’s selloff," the former official said.
The official also pointed to former GOP presidential nominee Mitt Romney as "a cautionary tale" for tying his candidacy to a single indicator — monthly jobs reports — when it was negative, only to see it turn in the last months of the campaign. "It stole his thunder. And his central case to voters was weakened a bit."
Scott Jennings, a GOP consultant who worked in the Bush administration, said Monday’s Dow drop “was an unfortunate thing to happen, while [Trump] was giving a big economic speech in Ohio,” but he said the “larger structural feelings about the economy right now for most voters are still good.”
“The smart thing would be to talk about the sound fundamentals — job growth, upward wage pressure — because they tend to be more stable,” Jennings said, adding that most people who aren’t day traders won’t change their view on the economy after one day. “They've lived through fluctuations before, so one day isn’t going to scare people into believing the economy isn’t sound.
Even ardent Trump backer Geraldo Rivera pointed out the issue with the president’s messaging.
A GOP consultant also said it's "very risky to brag about something every time it goes up because then you’re going to get criticized every time it goes down." But, the consultant argued, in the bigger scheme of things, Monday's events weren't an issue in and of themselves.
"The economy at large is incredibly important," the consultant said. "But I would argue that one day, any day, up or down, is probably not very important."
Former president Obama's press secretary Jay Carney tweeted Monday afternoon on the previous administration's reasoning for not boasting about the stock market, as Trump has done. (Obama, however, did boast about the stock market, but he did not talk about it in the same way Trump has, and used other economic indicators as well.)
The downturn in the stock market also gives Democrats an easy opening to attack Trump, and they are already taking shots.
“As the Dow nosedives on his watch, the President’s rambling, deceitful tax scam sales pitch reached an all-time low in Cincinnati,” said Drew Hammill, a spokesperson for House Minority Leader Nancy Pelosi, in a statement.
Democrats, though, face the same problem: That nosedive could always reverse.
Alexis Levinson contributed additional reporting to this story.