Business
As it was mentioned on a newscast, the suggestion was not to check your retirement accounts.
The U.S. stock market dropped 1,600 points on Thursday, which followed a significant decline on Wednesday.
By Friday morning the market was down another 1,000 points as what can only be called a trade war is taking place, with President Donald Trump continuing to raise tariffs on the nation’s trading partners around the world.
Other nations are responding to Trump’s hike in tariffs by implementing higher tariffs on their own.
Since taking office in January, Trump has mentioned raising tariffs on one day, only to delay the decision or cancel it the next.
What we all want to see is some consistency in what Trump is planning to do in terms of the U.S. economy.
A recession would not be welcomed as in many states, including Indiana, there is continued hope for new investments in the business and housing sectors.
The market is responding to the tariff increase in much the same manner it did during the COVID-19 pandemic, when many of the business around the world either closed or scaled back activity.
With each new increase in the tariffs, the price of goods being purchased in America will increase on everything from shoes and fresh produce to electronics, clothing and automobiles.
Many Americans have their individual retirement accounts tied to the stock market.
As the market declines, funds in those accounts decrease, which will cause tensions for those already retired and those anticipating retirement in the near future.
“If we do get into a global trade war, then it’s a very different discussion,” said Phil Blancato, a chief market strategist in New York. “Then we have a potential recession, significantly higher prices. We’ve got a stag-flationary environment. Those are all very dangerous moments. I don’t believe that’s the case, simply because the U.S. economy was strong going into this. We still have full employment. Other countries need us more than we need them.”
“That doesn’t mean we get a free lunch here,” Blancato continued. “There are going to be one-time price hikes on certain goods, not all goods.”
As most of us have noticed, the price of gasoline has increased significantly in the area to $3.39 per gallon, and the price of eggs is not decreasing.
There was a bit of encouraging news recently with job growth continuing to increase in the U.S.
Only time will tell what will be the next move by President Trump in terms of the economy and how it will impact millions of Americans.