To repeat, this steady improvement is not automatic. People will only save and invest when the government allows them to keep a portion of the returns. The stock market’s success—not only this past week, but over the past few years—is largely due to President Bush’s tax cuts. It is a simple matter of accounting that when the after-tax flow of income to an asset increases, its present market value will increase. As the stock market is the arena to buy and sell ownership in some of America’s largest companies, it is an excellent indicator of the financial condition of the country. Corporate profits have been at record highs lately, and thus it’s not surprising that the stock market has been doing so well.
Of course, the cynic could retort that this is just what the Marxists were talking about—the system is rigged for the wealthy few, while the little guy gets the shaft. But it helps everyone, not just Donald Trump, when the stock market rallies. If you’ve got a pension, chances are a large chunk of it is invested in the market. The endowments of universities and other recipients of donations are also tied to the market.
And finally, I’d ask those who lament our “horrible” economy: Do you really want to go back to the 1970s before the Reagan Revolution, when (in real terms) the stock market had been sliding for years, and unemployment and inflation were both in the double digits?