Yesterday was another ugly day for the bulls. At its morning low, the Dow Jones Industrial Average was down about 506 points. After a head-fake recovery, it finished the day down over 724 points. In times like these, everyone wants to know why. There are a number of theories running around out there. A review of the news on a number of financial websites suggests that share prices were (1) pressured by worries of a trade war. There is a rumor that Trump administration is set to announce tariffs directed at China for intellectual property theft. Some reports indicate the tariff could be as high as $50 billion on Chinese goods. (2) Many want to point at Facebook. The user data issue is taking on a life of their own, and these folks argue the resulting contagion is affecting tech shares which have been the high fliers ever since the financial crisis. (3) The New York Times reported John Dowd resigned as Trump's lead lawyer in special counsel Robert Mueller's investigation. While turnover is nothing new for this administration, people point to us nonetheless. While all of these are plausible, we think there is a bigger issue at play.
