Fight Back! News

News and Views from the People's Struggle

U.S. stocks fall for second day

By Masao Suzuki

Trump tweets while novel Coronavirus infections surge outside China

San José, CA – For a second day in a row, U.S. stock prices fell about 3% Tuesday, February 25. After a 1000-point drop on Monday, the Dow Jones Industrial Average fell almost 900 points, or more than 3%, while the broader S&P 500 fell 3%. Investors fled to buy bonds, pushing their prices up and their interest rate down to all-time record lows, with the ten-year U.S. government bond interest rate falling to 1.35%. Typically falling interest rates show fear of slower economic growth or even a recession ahead.

While stocks tried to bounce at the beginning of the day after Monday’s loss, they started to fall after a top U.S. Center for Disease Control doctor warned that it was a matter of when, not if, the coronavirus spreads to the United States. This warning came after infections continued to rise in south Korea, now with more than 1100 cases, and in Italy, with more than 300 infections. Even worse, five more countries – Austria, Croatia, France, Spain and Switzerland – reported new coronavirus infections traced back to Italy.

President Trump, in an attempt to prop up the stock market, claimed that U.S. coronavirus cases were “down to about ten” when in fact they have risen to 57. He then returned to tweeting about his trip to India and complaining about the prosecution and conviction of his associate Roger Stone. Larry Kudlow, Trump’s chief economic advisor, claimed that the coronavirus is “well contained.” But these reassurances rang hollow on Wall Street.

Meanwhile, in Washington D.C., the Trump administration acting head of the Department of Homeland Security, Chad Wolf, in testimony before Congress, showed his ignorance of the coronavirus issue. Like Trump he tried to downplay the issue, claiming that the seasonal flu has about the same death rate as the novel coronavirus COVID-19, when in fact the coronavirus is about 20 times more deadly.

The Trump administration has tried to cut funding for the CDC every budget year and proposed a 20% cut for this fiscal year. Trump’s former National Security advisor John Bolton eliminated the Global Health Security directorate. While Congress has restored most of the CDC funding cuts, Trump has focused on creating a new military Space Force.

While the Trump administration was quick to ban travel from China, this approach can give a false sense of security that is no substitute for public health preparedness. Italy was the first and only E.U. nation to ban flights from China, but now finds itself at the center of a new outbreak of the disease. Trump’s secretary for Health and Human Services admitted that the government only has 10% of the total number of medical masks that it would need to fight an outbreak.

The Trump administration proposal for $2.5 billion to fight the coronavirus came only after it has become clear that the virus is spreading. His proposal actually only has $1.25 billion in new funding, mostly for vaccine development that could be a year away. Even worse his proposal wants to take hundreds of millions of dollars from the fight against the deadly Ebola virus, which still has scattered outbreaks in Africa.

#SanJoséCA #US #PeoplesStruggles #economy #stockMarket #DonaldTrump #Coronavirus