The Dow Jones has been paused twice in the last 12 hours. These circuit breakers last 15 minutes and occur at specified percentages of loss: seven percent and 13 percent. Should the stock market drop 20 percent, it will shut down. The circuit breaker has not previously been used since 2008. Here is how Donald Trump has been dealing with the nation’s economic crisis.
CNBC’s Jim Cramer was furious with the president. Just before the market opened, this well-known financial analyst went off on the president for pulling a Marie Antoinette. When she was told the poor had no bread, she suggested they eat cake. Instead of dealing with this economic downfall, Trump was playing golf with team members of the Washington Nationals in Florida.
Cramer suggested several ways the commander-in-chief could be responding. Then, he said “We don’t want golfing:”
‘I think we all want more leadership. I think that we all want more test kits, if we’re going to just talk about health care. We all want the treasury secretary to come out and say ‘small businesses, we’ve got no-interest loans.’ We want to be able to take advantage of the curve … and be able to be ready. We don’t want golfing.’
The financial commentator took the situation right down to the bottom line. Did Trump want to win his reelection? If so, he had better get busy and deal with the situation:
‘t would be great if the president came out and said, ‘whatever it takes. Whatever it takes. Now, I am not saying that he should panic. I’m saying that if he wants to be the president come January, it’s a ‘whatever it takes’ moment.’
One of the president’s advisors Larry Kudlow erroneously told Americans that coronavirus had been “contained.” Cramer went right to the heart of the economic matter:
‘That may be an ill-advised position.’
Markets reopen after ‘circuit breaker’ pauses trading for 15 minutes, according to The Boston Globe:
‘The stock market on Wall Street has reopened after it was paused for 15 minutes following a sharp drop of more than 7 percent minutes after trading began on Monday. The drop continued after trading resumed, with the Dow falling more than 2,000 points shortly before 10 a.m. before recovering slightly.’
Then the trading fell seven percent:
‘A 15-minute trading halt trading halt took hold after the S&P 500 Index fell 7% to 2,764.21 as of 9:34 a.m. in New York, triggering the breaker for the first time since December 2008 at the depths of the financial crisis. Futures had plunged 4.89% overnight Sunday, triggering exchange rules that limit losses on those contracts and distorting price discovery for the cash market before the opening.’
Traders have never seen a 13 percent or a 20 percent circuit breaker:
‘When trading resumes, another 15-minute pause will happen if losses reach 13%, a drop that would put the S&P 500 at 2,585.96. If the decline hits 20%, or 2,377.9, markets will close for the day. Only the 20% rule applies in the final 35 minutes of cash trading. Traders have never seen a 13% or 20% breaker trip.’
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