In October, the Dow Jones industrial average reached a record high, nearing 27,000. As I write this letter, the Dow is down to 22,787, a decrease of 15.6 percent.

What are the reasons for this staggering market decline? Many ideas have been advanced by market analysts, by political leaders and by the media. These are some of the causes expressed by the media:

Global economic decline: Some of the big hitters in the global market, such as China and several of the European countries, have experienced economic downturns.

 Federal Reserve interest rate increases: During this year, there have been four increases in the Federal Reserve rate, each being one quarter of 1 percent.

 Historical last-quarter decline: It is not unusual for the stock market to decline in the months of October, November and December.

 Signs of a slowing U.S. economy: While there continue to be positive economic indicators, such as good company earnings rates and low unemployment, there seems to be a growing concern that the boom market can’t go on forever.

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The media seldom talk about what I believe to be a big contributor to the market decline: that is, the midterm elections. When it became apparent during the summer months that Democrats would retake the House of Representatives, the market began its precipitous drop. Within two days of the election, the market continued its nosedive.

What is it that Democrats do that causes market downturns? For one, business is not their friend; the party often increases taxes, and they find various ways to regulate business and other activity, which usually end up adding to a company’s expenses.

The media need to tell the whole story.

Robert Haggett

Biddeford


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