COMMENTARY_ Riding the economic roller coaster: Lessons from Reagan, Trump and the market’s wild ride

THE WASHINGTON TIMES

Riding the economic roller coaster: Lessons from Reagan, Trump and the market’s wild ride

Why long-term investing wins

Stock market and U.S. economy illustration by Linas Garsys / The Washington Times more >

COMMENTARY

By Cal Thomas - Wednesday, March 12, 2025

OPINION:

When I began investing in balanced mutual funds in 1983, the Dow Jones Industrial Average stood at 1,190. On Monday, despite dropping more than 1,000 points, the index closed at 41,911. It’s the difference between looking at short-term versus long-term investing.

I called my financial adviser, who told me not to worry about the latest decline because I am diversified. Besides, she said, “it’s only paper.” That may not sound reassuring until one considers we’ve been here before.

The year was 1981, and the country was struggling with double-digit inflation (13.5% at the end of the Carter presidency), high unemployment (8%), high interest rates (mortgage rates soared to 16.64%) and sinking public confidence.

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READ MORE: https://www.washingtontimes.com/news/2025/mar/12/riding-economic-roller-coaster-lessons-reagan-trump-markets-wild-ride/

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As with Reagan, Mr. Trump has to deal with the fallout from his predecessor’s economic policies, including Mr. Biden’s Inflation Reduction Act, which caused inflation and produced the high prices and other negative consequences Democrats claim are Mr. Trump’s fault. Really? After only six weeks in office and with his last Cabinet officer confirmed by the Senate just this week?

Detox is painful, but the result is worth the effort. Our problem is that too many Americans have become overly reliant on the government to take care of them while ignoring the old Puritan ethic of self-reliance. Politicians have been fine with this because it contributes to their careers and power. That attitude has contributed to our $36 trillion national debt and inflation, which the administration, with the help of Elon Musk and his squad at the Department of Government Efficiency, is trying to reduce.

Economic roller coasters can be scary, but like the rides at the fair, the end produces satisfaction, relief and even a thrill. So, hang on.

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