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Government Shutdown Sends Stocks Plummeting – Mnuchin Calls In ‘Plunge Protection Team’

With stocks down sharply and the S&P 500 index reportedly on pace for its biggest percentage drop in December since the Great Depression, Treasury Secretary Steven Mnuchin called the heads of the six top U.S. banks and released a statement saying that there was “ample liquidity for investing” despite the government shutdown.

According to the statement, Mnuchin talked with the chief executives of Citi, Bank of America, Goldman Sachs, JP Morgan Chase, Morgan Stanley and Wells Fargo, as he joined with President Trump in trying to ease concerns on Wall Street amid all the doomsayers, the Daily Mail reported.

The Treasury also revealed plans to convene a group called the “Plunge Protection Team,” which was also convened during the 2009 financial crisis — included in the group are officials from the Federal Reserve and the Securities and Exchange Commission, according to the Daily Mail.

The group is part of the president’s Working Group on Financial Markets, which will come together Monday on a call with Mnuchin.

Amid reports that Trump was considering firing Federal Reserve Chairman Jerome Powell, after a decision Wednesday to increase interest rates, Mnuchin went online to quell these rumors and to say that he disagreed with the increase, “especially in light of my major trade negotiations which are ongoing.”

The partial government shutdown is not helping matters, and the increase in interest rates, which the president has been critical of, could slow economic growth.

While the market’s open on Monday may prove to be interesting, one thing is certain, the statement from Mnuchin has prompted a sea of questions from those who follow the market.

Here’s a sampling from Twitter:

And there were plenty of skeptics suggesting that it may be time to run for the hills:

Via BPR

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