On The Money: Stocks slide for second day as Trump blames 'loco' Fed | Mulvaney calls for unity at consumer bureau | Pelosi says Dems will go after Trump tax returns

On The Money: Stocks slide for second day as Trump blames 'loco' Fed | Mulvaney calls for unity at consumer bureau | Pelosi says Dems will go after Trump tax returns
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Happy Thursday and welcome back to On The Money. I'm Sylvan Lane, and here's your nightly guide to everything affecting your bills, bank account and bottom line.

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THE BIG DEAL--Stocks slide as Trump pins blame on 'loco' Fed: U.S. stocks fell sharply for a second straight day Thursday as fears of higher interest rates and overpriced technology shares rattled investors.


The Dow Jones Industrial Average closed with a loss of 546 points, a 2.1 percent drop, after falling by 650 points earlier Thursday. The Nasdaq composite and S&P 500 index dropped 1.25 percent and 2 percent each as the steepest sell-off since February stretched into its second day.

Stocks briefly gained ground as trading opened Thursday, a day after the three major indexes dropped at least 3 percent each, before turning south later in the morning.


President TrumpDonald John TrumpCould Donald Trump and Boris Johnson be this generation's Reagan-Thatcher? Merkel backs Democratic congresswomen over Trump How China's currency manipulation cheats America on trade MORE, who loves touting the stock market and hates high interest rates that can get in the way, has blamed a series of Federal Reserve rate hikes for the downturn. The president has broken from the majority of Republicans, who favor higher rates, and said the Fed is out of control.

"The problem in my opinion is [Treasury bonds] and the Fed," Trump told Fox News. "The Fed is going loco and there's no reason for them to do it and I'm not happy about it."

Trump explicitly blaming the Fed for the stock downturn is a major escalation of his frequent criticism of the central bank. The president had told reporters earlier Wednesday that the Fed "has gone crazy" with rate hikes, but said that day's stock downturn was "actually ... a correction that we've been waiting for, for a long time."

"The problem that I have is with the Fed," Trump said late Wednesday, "The Fed is going wild. I mean, I don't know what their problem is that they are raising interest rates and it's ridiculous."

The top White House economic adviser on Thursday said that Trump was not giving orders to the Fed, but simply sharing his opinion of the independent central bank.

National Economic Council Director Larry Kudlow told reporters that Trump's fierce criticism should not be seen as an attempt to influence the Fed, and that the president respects the central bank's intended insolation from politics.

Behind the scenes, Kudlow and Treasury Secretary Steven MnuchinSteven Terner MnuchinHow China's currency manipulation cheats America on trade The Hill's Morning Report: Trump walks back from 'send her back' chants Trump faces new hit on deficit MORE urged Trump to hold back on slamming the Fed and instead focus on the strong economy, according to Politico.


What comes next: Stocks had another brutal day Thursday, but it's too early to tell if this is the start of the sweeping correction traders have been bracing for since the start of 2018. If the market holds steady, Trump will likely be satisfied enough to curb his shots at the Fed. But if this is the start of a protracted downturn, you can expect an onslaught of criticism as we head into the midterm elections.

Overall, the economy is fairly strong and the Fed's insistence on moving ahead with rate hikes underscores that. The GOP has ample stats and figures to tout as its defends its control of government, but a Trump war on the Fed could undercut that economic message.



SCOOP--Mulvaney calls for unity at consumer bureau amid racial controversy: The acting director of the Consumer Financial Protection Bureau (CFPB) issued a call for unity to agency employees Thursday amid a backlash over racially charged writings by a top official he appointed.

Acting CFPB Director Mick MulvaneyJohn (Mick) Michael MulvaneyThe Hill's Morning Report: Trump walks back from 'send her back' chants Trump faces new hit on deficit GOP wants commitment that Trump will sign budget deal MORE urged agency staffers to treat each other with "professionalism, respect and civility," in an internal Thursday email obtained by The Hill, asking the consumer watchdog agency to come together around its mission.

"We do our work together, and we are either going to choose to do it very well, or we won't," Mulvaney wrote. "That is a choice we make together. Our focus must always remain on doing our jobs, enforcing the law and working together to do a great job for the American people."


  • Mulvaney has faced an internal rebellion inside the CFPB over the emergence of blog posts dismissing hate crimes. The blog posts were written 14 years ago by Eric Blankenstein, the bureau's director of supervision, enforcement and fair lending.
  • Several senior CFPB officials, Democratic lawmakers and liberal political groups have called on Mulvaney to fire Blankenstein. The acting director said in the Thursday email that he is "not going to let any outside group dictate who works here or how I structure or manage the bureau."


I've got more on Mulvaney's message and why it will likely fall flat at the CFPB here.

Pelosi promises to request Trump tax returns if Dems win House: 
House Minority Leader Nancy PelosiNancy PelosiDHS chief to Pelosi: Emergency border funding 'has already had an impact' The Hill's Morning Report: Trump walks back from 'send her back' chants Trump faces new hit on deficit MORE (Calif.) on Wednesday said that if Democrats win back the House in November's midterms, they will demand that President Trump hand over his tax returns.

Pelosi told The San Francisco Chronicle's editorial board that forcing Trump to release his tax returns "is one of the first things we'd do" if Democrats control the Lower Chamber.

"That's the easiest thing in the world. That's nothing," she said.

Democrats have pledged previously to get their hands on Trump's tax returns if they gain control of the House, with Minority Whip Rep. Steny HoyerSteny Hamilton HoyerThe House Democrats who voted to kill impeachment effort Overnight Defense: House votes to block Trump arms sales to Saudis, setting up likely veto | US officially kicks Turkey out of F-35 program | Pentagon sending 2,100 more troops to border House votes to block Trump's Saudi arms sale MORE (D-Md.) arguing that the public deserves to know "whether or not a president is serving his interests or the public's interests." Here's more on the Democratic gameplan from The Hill's Michael Burke.