CLEVELAND — It was another wild day on Wall Street as the markets closed for a third trading day. The market uncertainty was in response to President Trump's sweeping tariffs on a wide array of foreign countries last week. Mixed signals not long after the market opened over the possibility of a 90-day pause saw the market fluctuate between negative and positive territory for a time.
Watching from Northeast Ohio are investors we spoke with, like Ralph, who said he is "super concerned."
"I closed out my 401K and put it into an IRA," he said.
On the other hand, Jamey Mahoney said he has no concerns and will take no action.
"It's always come back around; it will again. You know we've been down before we always keep coming back up. That's what we do."
Financial advisor Rob Burnette told News 5 that what to do right now is a personal decision for each investor. Still, he advises his clients to look at what's happening from a historical perspective.
"Think Covid," he said. "Covid was down 31% in a very short period of time. We finished positive for 2020. So once again these things can come back, and my opinion right now is the market was having a temper tantrum."
That's partly because of uncertainty over whether the tariffs are permanent or subject to negotiation.
"They have no problem with risk; they know how to evaluate risk, they know how to hedge for risk. Risk is not an issue. Uncertainty is because they can't predict that," he said.
Count the state in that category. Governor DeWine reminded reporters Monday that the budget is based on economic predictions.
"Unlike the federal government, we have to actually balance our budget, which we think is a good thing, and so, if we have a downturn in the economy, if that's what happens, then certainly that's going to impact our budget."
He's also watching the markets for the impact they may have on the $114 billion Ohio Public Employees Retirement System (OPERS).
"We can only assume that anybody who owns any kind of broad portfolio of stock, OPERS would do, they certainly are going to be hit by this, there's no doubt about that," DeWine said. "They set up their investments however to weather storms and sure we're going to keep an eye on that but this is something that you know professionals investors do, make sure that they don't have everything in the stock market. Make sure they have bonds; they have other investments."
History has taught us that the one positive that comes out of the negative impacts of an economic downturn is the price you pay at the pump. While the average price of a gallon of gas this day in Cleveland is $3.13, which is up close to 11 cents higher than last week, it's not likely to stay there as oil has dropped over the last three days of trading. That's because when the economy slows, there's less energy consumption.
"That's why oil prices are tanking on the possibility of a broader trade war because a trade war is going to mean less spending," said Patrick DeHaan, head of Petroleum Analysis at GasBuddy.com. "It's going to mean less energy consumption and so at least for now oil prices have briefly dropped to their lowest level since the pandemic."
Beyond that, he said we're now at the point where we normally see the highest gas prices for the year.
"Typically, gas prices don't peak in the summer but typically right about now. In fact April 10 is the average peak that we've seen in the national average going back a decade. So we're real close to seeing peak pain at the pump and gas prices will probably fall back below $3 a gallon later this week."
