The Dow Jones finished at 10,809 after losing 635 points on Monday, Forbes reports. The 5.5% decrease is the lowest point in the stock market since September 2010. Standard & Poor’s (S&P) 500 Index also fell 80 points and stocks plummeted for NASDAQ and NYSE. It is believed that drop and rapid sale of stocks came are in reaction to S&P’s Friday announcement to downgrade the United State’s credit rating for the first time ever.
The drop signal a lowered amount of faith in America’s economy.
S&P also stated that it would be downgrading the debt of mortgage brokers Fannie Mae and Freddie Mac.
The L.A. Times reported that investors have been seeking to acquire gold and treasury bonds as “safe” measures to whether any economic storm that might ensue in days to come.
However, President Obama says that the nation’s economic issue can be overcome.
“There will always be economic factors we can’t control…but how we respond to those tests, that’s entirely up to us,” he said in a statement.
In order to repair the nation’s economy and prevent a large economic crisis, the president believes that tax reform, job creation, and an assessment of government programs in the coming years will be vital.