The chairman of the House Ways and Means Committee wrote off Monday’s historic Wall Street losses as a positive byproduct of tax reform.
“It reinforces that tax reform is growing this economy. So, wages are increasing, which they haven’t for more than a decade — that’s a good thing,” Rep. Kevin Brady, R-Texas, told The Daily Caller.
“And so that is a part of the inflation, and then the second concern from Wall Street appears to be the Fed normalizing its interest rate — something that everyone has said is long overdue and a signal of a stronger economy, one that can assimilate those interest rate increases.”
The Dow finished Monday’s trading down 1,175.21 points, which amounts to a 4.6 percent loss. At one point late in the day it was down nearly 1,600 points before closing at 24,345.75. The S&P 500 lost 113.19 points (4.10 percent) and the Nasdaq Composite dropped 273.42 points (3.78 percent).
Brady said it’s time for the Fed — led by chairman Jerome Powell, who was sworn in Monday — to “normalize” interest rates because of the strong economy.
“I think the correction really represents the opposite of my pet peeve over the last number of years, which is every month and every quarter when the economy’s economic projections were slow, the market would rally, because interest rates wouldn’t be going up,” Brady said. “That always seemed puzzling to me — I think it’s healthy that they now see we are going to normalize these areas.”
Following the stock market losses, White House press secretary Sarah Sanders said President Donald Trump is focused on “on our long-term economic fundamentals, which remain exceptionally strong, with strengthening U.S. economic growth, historically low unemployment, and increasing wages for American workers.”
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