While many Americans were uncertain about the future of the country after the election of Donald Trump, the stock market rallied on his promises to cut taxes and repeal the Affordable Care Act in favor of a more market-friendly health care bill. Tuesday, the Dow fell by nearly 240 points, its largest dip in five months. This drop comes as investors have begun to question the Trump administration’s ability to fulfill its campaign promises.
Some investors believe that the administration’s inability to push through its Affordable Care Act replacement bill puts the rest of its market-stimulating policies in danger as well. “President Trump promised that this health care bill would be signed, sealed, delivered within the first couple of weeks of him taking office,” Jack Ablin, chief investment officer for BMO Capital Markets said in a memo. “All this is doing is pushing the rest of the agenda out.”
On Tuesday, Merrill Lynch released a survey of its fund managers, with a record number saying the market is extremely overvalued. Just 10 percent of those surveyed believe that the administration will make good on its promise to pass any tax reform before Congress’ August recess. “President Trump’s legislative agenda is getting mired in a congressional swamp, as starry-eyed optimism runs headlong into bloodshot realism,” Ablin said.
While investors have become uncertain about the future of the market given Trump’s shaky first two months, his inability to spur Congress into passing his agenda could be the best thing to happen for the American people. If Trump’s American Health Care Act passes, over 24 million Americans will lose health care coverage and the price of insurance will surge throughout the country.
