With the Dow hitting 23,000 for the first time in its history, Sunshine State News talked with Trish Regan from Fox Business Network on whether or not that kind of growth can be sustained and if there are perils ahead for the market.
One of the leading financial journalists on TV, Regan hosts “The Intelligence Report” on the Fox Business Network and, before that, hosted “Street Smart” on Bloomberg Television and worked as an anchor for “The Call" on CNBC. Regan is also a featured columnist for USAToday.
SSN: This week, the Dow hit 23,000 for the first time. What do you see as the main factors for this record high?
Regan: Less regulation, the promise of lower taxes, and, perhaps most importantly - optimism. There’s a belief on Main Street and Wall Street that the federal government is committed to growing our economy. So, instead of, “How can we punish big, bad business?” It’s “how do we enable businesses to grow so that more jobs are created?” That’s an important distinction. Small business is the engine of growth in this nation – and big business helps a lot, too. For us to succeed, we must offer the most competitive environment.
SSN: We’ve seen around 50 record highs on Wall Street this year and the Dow moving from 22,000 to 23,000 in the course of two and a half months. Is this kind of growth sustainable?
Regan: If we see the meaningful economic reforms that the country has been promised? The traders and CEOs I speak with say, absolutely. We could actually see better 3 percent overall growth. And, growth is critical if we hope to generate a real increase in wages.
SSN: Increasingly Republicans on Capitol Hill and in the White House are saying tax reform might have to wait until 2018. How is the tax reform debate impacting the markets?
Regan: The markets will be highly disappointed if Washington doesn’t deliver. Economic reforms that result in more jobs and higher wages are essential to our future. I talk a lot about, what I call, our hourglass economy. We’re an hourglass with the wealthy on top, poor on the bottom, and the middle class stuck in the middle and feeling the pinch. The wealthy have benefited from asset inflation in this economy. Meanwhile, the poor have had access to an increasing number of social programs. So, the real problem for our nation is in the center of that hourglass. The middle class are squeezed because they often don’t have enough money to invest—but, they have too much money to qualify for handouts! Middle class Americans are trapped in an economy that has made it increasingly difficult for them to earn a living and this needs to change. If economic reforms can address this hourglass problem, that’s significant.
SSN: October has often been a rough time for the market from the crash of 1929 to “Black Monday” which took place 30 years ago this month. Are there any signs that we could be looking at a major reversal, correction or downturn in the near future?
Regan: Having reported on the financial crisis of 2008, I feel like I’ve seen the worst of it. While the potential for a correction in a bull market is always there, it doesn’t worry me. A systemic problem would. However, I don’t see any systemic issues on the horizon right now.
Mild corrections, I wouldn’t worry about. They’re healthy for the markets because they offer opportunities for more people to invest. Eventually, we’ll regain any lost ground.
SSN: This week marks the 10th anniversary of the launch of the Fox Business Network. What do you think have been the network’s highlights over the past decade? How do you see its role in business today and in the future?
Regan: We are thrilled to be beating the competition. I came here two years ago, just as the political season was beginning to heat up and, while our competitors were stuck trying to cover whether or not a particular stock would be going up or down in a given day, we focused on explaining the link between the markets and Washington. We do that better than anyone else. Period. I like to say, our viewers care about macro, not micro. That means they want to know which policies matter the most, whether those policies will be implemented, and how those policies will affect their lives and investments. We get that. The intersection between the economy, politics and the markets is our niche – and viewers know it.
