WASHINGTON — Treasury Secretary Steven Mnuchin testified before the House Financial Services Committee on Tuesday, a day after the Dow Jones saw its largest point drop in history. Questioned about the “market rout” by Rep. Carolyn Maloney, D-N.Y., Mnuchin pointed out that, as of Tuesday morning, the Dow industrial average was up, and argued that the overall state of the economy is solid.
“They have been quite volatile today,” Mnuchin said of the markets. “I normally wouldn’t be looking at my iPhone, but given the market moves, I’m checking it. … We’re back up today. I’m not overly concerned about the market volatility. I think the fundamentals are quite strong.”
The Dow Jones climbed from just over 20,000 points to more than 26,000 during President Trump’s first year in office, but has fallen more than 2,000 points since Jan. 26. It was up and down on Tuesday morning, although not as volatile as on Monday, when it plunged 1,175 points.
Mnuchin’s testimony, which had been scheduled previously, was about the annual report of the Financial Stability and Oversight Council. In his introductory remarks, he said that one of his “top priorities” is “sustained economic growth for the American people.” He pointed to strong economic growth during the past year, as well as “special bonuses” and wage increases issued by companies in the wake of recent tax cuts. Mnuchin said these benefits showed that Trump’s tax policy has had a “positive impact.”
Mnuchin’s statement that the “fundamentals” of the economy are strong echoes the line from the White House. On Monday night, after the precipitous point drop, White House press secretary Sarah Sanders released a statement saying, “The President’s focus is on our long-term economic fundamentals, which remain exceptionally strong.”
Maloney pressed Mnuchin on whether the recent declines have larger “financial stability implications.” The treasury secretary responded by pointing to the overall growth of the stock market in recent months.
“No. I don’t think these types of moves, given how much the market has rallied, do have financial stability concerns,” said Mnuchin.
Trump has repeatedly pointed to stock prices as evidence that his policies were strengthening the economy. Maloney asked Mnuchin if the Trump administration would also “claim credit when the markets go down.”
“Again, I think we’ll still claim credit for the fact that it’s up over 30 percent since the election,” Mnuchin said.
Mnuchin’s testimony was scheduled to continue into the afternoon.
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