Top Democrats have accused Donald Trump of “plunging the country into chaos” as top officials met to discuss a growing rout in stock markets caused in part by the president’s persistent attacks on the Federal Reserve and a government shutdown.
“It’s Christmas Eve and President Trump is plunging the country into chaos,” the two top Democrats in Congress, House speaker nominee Nancy Pelosi and Senate minority leader Chuck Schumer, wrote in a joint statement on Monday.
“The stock market is tanking and the president is waging a personal war on the Federal Reserve – after he just fired the Secretary of Defense.”
Trump criticized the Federal Reserve on Monday, describing it as the “only problem” for the US economy, even as top officials convened the “plunge protection team” forged after the 1987 crash to discuss the growing rout in stock markets.
The crisis call on Monday between US financial regulators and the US treasury department failed to assure markets, and stocks fell again amid concern about slowing economic growth, the continuing government shutdown, and reports that Trump had discussed firing Federal Reserve chairman Jerome Powell.
The Dow Jones plummeted 653 points in a shortened trading day on Monday, capping its worst week in a decade and reportedly marking its “worst day of Christmas Eve trading ever”. Investors appeared increasingly skittish.
The S&P 500 also dropped 2.7%, leaving it on pace for its biggest percentage decline in December since the Great Depression and indicating a move to a bear market, according to CNBC.
In a tweet that did nothing to ease market concerns about the Fed’s cherished independence, Trump laid the blame for economic headwinds firmly at the feet of the central bank.
“The only problem our economy has is the Fed. They don’t have a feel for the market,” Trump said on Twitter. “The Fed is like a powerful golfer who can’t score because he has no touch – he can’t putt!”
Trump has frequently criticized the Fed’s raising of interest rates this year and has gone after Powell several times, telling Reuters in August he was “not thrilled” with his own appointee. The Fed increased rates again last week.
The drops came despite US treasury secretary Steven Mnuchin’s attempts to calm wary investors over the weekend.
Mnuchin said on Sunday that he had called CEOs from the nation’s six largest banks – Bank of America, Citi, Goldman Sachs, JP Morgan, Morgan Stanley and Wells Fargo.
Mnuchin said these banks had promised him that they had enough money on hand, despite the fact that concerns over liquidity did not appear to have previously shaken the market.
Prior to these Tweets, Mnuchin sought to dispel reports that Trump wanted to axe Powell over the Fed’s decision to raise interest rates.
Trump nevertheless railed against the Federal Reserve on Monday.
Traders seemed to react to the sudden resignations of defense secretary James Mattis and anti-Isis coalition leader Brett McGurk over Trump’s snap decision to pull US troops from Syria last week. Trump reportedly forced Mattis to step down two months early, apparently angry that Mattis openly criticized his policies.
The partial government shutdown went into effect at midnight on Friday after Donald Trump’s demands for border wall funding left lawmakers in a stalemate.
Trump tweeted on Monday that he was “all alone (poor me) in the White House waiting for the Democrats” to make a deal.
“Instead of bringing certainty into people’s lives, he’s continuing the Trump Shutdown just to please rightwing radio and TV hosts,” Schumer and Pelosi said in their joint statement, arguing that it was unclear what exactly what the president was trying to get out of the shutdown.
“Different people from the same White House are saying different things about what the president would accept or not accept to end his Trump shutdown, making it impossible to know where they stand at any given moment,” they said. “The president wanted the shutdown, but he seems not to know how to get himself out of it.”
House and Senate members could not broker a deal prior to Congress’s adjournment for the holiday and prior to this deadlock, however, and Trump warned of a “very long shutdown”.
While Senate majority leader Mitch McConnell appeared open to reconvening before the session resumes Thursday if a deal were brokered, House majority whip Steve Scalise’s staff told ABC News a vote wouldn’t take place before Thursday.
Mick Mulvaney, Trump’s new acting White House chief of staff, also painted a bleak picture during an appearance on Fox News Sunday.
Trump won’t step back from his “fight over border security,” Mulvaney said.
“I don’t think things are going to move very quickly,” he said. “There’s a chance this could go into the next Congress.”
More than 420,000 federal employees will work without getting paid during the partial shutdown.