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Americans’ retirement and investment portfolios would suffer with other presidents, and the economy wouldn’t be as strong as it is now, President Trump said in remarks to reporters after the jobs report on Thursday.
Since November 2016, the Dow Jones Industrial Average DJIA, +0.97% has grown roughly 45%, the S&P 500 SPX, +0.96% has increased by 47% and the Nasdaq Composite COMP, +0.98% jumped nearly 100%, he said. “These are not numbers other presidents would have,” he said, noting others may want to raise taxes. “Your 401(k) will drop down to nothing and the stock market will drop down to nothing.”
He credited the growth of the stock market to his administration’s actions with partners and Congress, including the federal government’s response to the coronavirus crisis. “This is not just luck,” he said. “This is a lot of talent.”
The stock market has taken investors on a wild ride this year. In February, when the first few cases of the coronavirus were detected in the U.S., the stock market tumbled to correction territory, and in March, it officially entered a bear market. States issued lockdowns, which shuttered businesses and cost workers their jobs or a portion of their earnings, and Americans began claiming unemployment in droves.
Since then, the market has seen its fair share of ups and downs. In the three months following the shutdowns, the U.S. was back in a bull market, as states combated coronavirus cases across the country and hope formed for businesses to reopen to an almost normal schedule again. Even then, however, the market has been rocky as it reacts to jobs reports, record levels of daily coronavirus cases in some states, and uncertainty over the future.
On Thursday, the U.S. stock-index futures saw gains in response to the country seeing a drop in unemployment, from 13.3% in May to 11.1% in June.
Also see: How can I protect my 401(k) from a coronavirus-driven market downturn?
Throughout this, retirement savers have been told not to panic. Volatility is normal, and if they have a financial plan from a professional adviser, it likely includes a cushion for those seeing their investments take a beating. The government expanded eligibility requirements for savers to withdraw or borrow from their retirement plans, though advisers have cautioned to use that option as a last resort.
It’s too soon to tell what the longer-lasting impacts of the coronavirus crisis, and its effects on the economy, will mean for retirement savers and retirees, though. Nearly everyone will be affected, whether they are high- or low-earners, because of lower retirement account balances and faltering job security, experts said.
