The stock market tumbled substantially on Monday, largely due to investor fears of a resurgence of COVID-19, rising price inflation, and reduced expectations of continued economic growth.
Yet, according to President Joe Biden, “capitalism is alive and very well,” and the American people should ignore what they are seeing with their own eyes and trust that his plans will work to make the nation’s economy even better than it was before the pandemic began, the Washington Examiner reported.
The president also dismissed inflation concerns, took credit for hundreds of thousands of jobs added over the past six months, insisted that his multi-trillion-dollar spending plans would fuel the economy and job growth without adding to inflation, and urged everyone to get vaccinated against the virus.
Stock markets plummet
As President Biden sang the praises of his economy, the Dow Jones Industrial Average (DJIA) suffered its worst decline of the year, dropping as much as 946 points before slightly rebounding to close out the day down 725 points, or about 2.1%, CNBC reported.
The S&P 500 and Nasdaq Composite also tumbled — 1.6% and 1.1%, respectively — on Monday while numerous other markets and metrics moved in a negative direction.
The drops were reportedly caused by concerns about the surge of new “delta variant” COVID-19 cases nationwide as well as predictions that the robust economic recovery — which is really just the nation getting back to work following the easing of pandemic-related business restrictions — would slow substantially in the coming months, to say nothing of the worry that dumping trillions of more dollars into the economy would add to inflationary woes.
Biden claims success
None of that was evident in a speech President Biden delivered Monday to tout the economy and the purported positive impact his administration had already had on it, a speech that began with his highlighting dire economic predictions from and taking shots at his predecessor, former President Donald Trump, without actually naming him.
“Folks, it turns out capitalism is alive and very well. We’re making serious progress to ensure that it works the way it’s supposed to work: for the good of the American people,” Biden said. “So, for all those predictions of doom and gloom, six months in, here’s where we stand: record growth, record job creation, workers getting hard-earned breaks.”
He went on to claim that he had brought the economy “back from the brink” and laid the foundation for a “long-term boom” and not just a “temporary boost.” A big part of that “foundation” was his $1.9 trillion American Rescue Plan, a roughly $600 billion bipartisan infrastructure deal, and an estimated $3.5 trillion partisan agenda catch-all measure that he has dubbed the “Build Back Better” plan.
Biden also dismissed concerns over rising inflation — the American people are undeniably paying more now for just about everything — and insisted that higher prices were “expected” and “temporary” and solely the result of the global economy reopening after being shut down in response to the pandemic.
He did, however, note that “unchecked inflation” would pose “real challenges” to the U.S. economy but pointed out that he had instructed Federal Reserve Chairman Jay Powell and his independent institution to “take whatever steps it deems necessary to support a strong, durable economic recovery.”
Of course, in Biden’s view, such action by the Fed would be unnecessary if his massive spending plans were approved by Congress and everyone became fully vaccinated, which he claimed would “enhance our productivity — raising wages without raising prices. That won’t increase inflation. It will take the pressure off of inflation, give a boost to our workforce, which leads to lower prices in the years ahead.”