One trillion dollars have gone missing. There aren’t many topics on which I consider myself an expert, but after four decades in journalism I will assert that I know a good story when I see it, and I will tell you that the disappearance of a trillion bucks sounds like a humdinger.
But we haven’t exactly been tearing up our front page to make way for tales of the trillion-dollar search, have we? Nor do you see much of it on television. But, then, the cable news audience is usually diverted by such consequential stuff as whatever the day’s turtle-tinkle tweets from the White House may be.
Check this fact, though: Stocks in those high-flying companies known as FAANG — Facebook, Amazon, Apple, Netflix and Google — have collectively lost $1 trillion in market value from their high-water mark over the past year. If, by chance, you invested your nest egg entirely in those companies — maybe you got excited as the president bragged that the market was skyrocketing on his watch — then I am sorry to report that you must never even think of retiring. In fact, you’d better stop reading and get back to work now, because you’re going to need the overtime pay.
The big five’s woes aren’t the end of the story. The stock market overall is suddenly performing dreadfully. All the market gains since the start of 2018 have been wiped out. The S&P 500 has plunged this badly at the start of a fourth quarter only five times in history, including three years of the Great Depression and the 1987 Black Monday crash.
On this topic, President Donald Trump has been uncharacteristically quiet. He used to love to gloat about the stock market. Just a year ago this month, he said, “The reason our stock market is so successful is because of me,” and complained in a tweet that the “fake news” media wasn’t giving him credit.
Having thus been called out, I must respond that I am here neither to bury this Caesar nor to praise him, because neither the market’s tumble nor its rise were really Donald Trump’s legacy to claim. Myriad factors cause stocks to move, and a president’s actions are but a piece of the puzzle. Yes, last year’s tax cut juiced the economy a bit, but since it was financed by government debt, it’s likely now contributing to the slide. The Federal Reserve has been hiking interest rates; that always puts downward pressure on stocks. Fears that Trump’s trade war with China may hurt exports for years are taking hold, spooking investors. But more significantly, the bull run that began in 2009, under a different president, has been going on for so long that it’s simply time for the natural leveling to occur. And so it goes.
Which is why this hasn’t overtaken newspaper front pages. A market downturn is usually a slow-moving event, as predictable and natural as cold temperatures settling on upstate New York in November. So while it deserves some coverage, just as the weather does, it’s not going to get what in my line of work is irreverently called “second coming type” — that is, a headline presumed big enough to tout the physical return of Jesus of Nazareth. This ain’t that.
People who invest in the market — 54 percent of Americans, either through individual stocks, mutual funds, pensions or 401(k)s — presumably know that it’s an up-and-down thing. It can be unsettling to people of a certain age (see hair color in my column logo), but it’s the way things are.
Note, though, that almost half of Americans aren’t in the market, so they never saw that party on Wall Street the president used to brag about. Maybe they got some benefit from wage and job growth, but a market dip will erase all that quickly.
Moreover, those non-market players are on the losing end of our economy’s record inequality. That’s also rarely front-page news, because it has become as much a fact of life as the market’s rise and fall. But here’s the fact of that: The richest 1 percent of Americans hold 38 percent of the wealth, while the bottom 90 percent hold 73 percent of the debt.
This underlying reality drives much of what you see on front pages, in digital alerts and on newscasts. Wealth inequality yields the offspring of poverty — crime, drug dependence, social unrest — as well as political frustration that gives rise to a society torn by nationalism and racism, its citizens too distracted by fears and daily struggles to confront such crucial issues as climate change and health care. The American dream was born in hope, but it can be buried by intractable wealth inequality.
That doesn’t draw White House tweets or breathless reports from network correspondents. It’s ever-present, so you can’t cover it like the rise and fall of the market, and few politicians make much of a stink about it, so there aren’t big headlines on our pages. But that, folks, is a genuinely big story.
Rex Smith is editor of the Times Union. Contact him at rsmith@timesunion.com.