Trump tells reps to postpone stimulus talks until after election

Trump tells reps to postpone stimulus talks until after election

United States President Donald Trump on Tuesday announced via Twitter that he has told his representatives to stop negotiating with Democrats in Congress over a new round of coronavirus relief aid until after the November 3 election.

Trump accused the Democratic leader, House Speaker Nancy Pelosi, of “not negotiating in good faith”, announcing: “I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business.”

The announcement fell just hours after Federal Reserve Chairman Jerome Powell said that the US economic recovery is in danger of faltering without more government aid.

In a virtual address to the National Association for Business Economics, the Fed chief warned: “Too little support would lead to a weak recovery, creating unnecessary hardship for households and businesses.”

A slew of data – from initial claims for unemployment benefits to consumer spending and income to job creation – is signalling that the US economic recovery is shifting into low gear.

That deceleration is attributed by many economists to the waning effects of nearly $3 trillion in federal virus relief aid that Congress passed in March and April.

The $600 federal weekly top-up to state unemployment benefits expired at the end of July. Layoffs remain stubbornly high, and many workers who were furloughed are finding that their job losses are becoming permanent.

And though the nation’s unemployment rate fell from a pandemic high of 14.7 percent in April to 7.9 percent in September, it is still far from February’s rate of 3.5 percent.

While the real economy has a lot of ground to make up to recover its pre-pandemic strength, Wall Street has powered ahead to overcome losses from earlier in the year and stage new highs.

But Trump’s announcement on Tuesday landed on Wall Street like a gut punch, sending the major stock indexes down sharply.

With roughly a half an hour left in the trading day on Wall Street, the Dow Jones Industrial Average was down more than 300 points, or 1 percent. The broader S&P 500 – a proxy for US retirement and college savings accounts – was 1.29 percent in the red.