President Obama was snapped back into the reality of dealing with a fragile economic recovery today as stocks plunged in the wake of his re-election and the labor department announced that job openings dropped to a five-month low.
The Dow Jones industrial average plummeted 200 points within minutes after the opening bell and it continued falling, down 354 points two hours later. In late afternoon trading, it was down 323 points, or 2.5 percent, while index futures also plunged after the European Union slashed its growth forecast for next year.
Meanwhile, the dollar rose and the Labor Department announced that the number of job openings waiting to be filled declined by 100,000 to 3.56 million from the prior month. The figures show that the October jump in private payrolls, which was the biggest in eight months, may be difficult to sustain.
Mere hours after the jubilation of winning a hard-fought campaign against Republican challenger Mitt Romney, Obama must now face the headaches of the so-called ‘fiscal cliff’ of $607 billion in tax increases and spending cuts, high unemployment and uncertain economic growth.
As he approaches the challenges ahead, voters will be holding him to his acceptance speech promise that ‘the best days are yet to come.’
Obama returns now to a still-bitterly divided Congress in Washington, which must come to a deficit reduction agreement within the next 54 days to avoid the fiscal cliff’s debilitating mixture of tax increases and spending cuts.
If Congress fails to act, the U.S. economy would contract sharply, potentially sending the nation into a second recession that could spread globally.
Businesses are already slowing hiring and holding back from making new investments in preparation for the possibility that Congress fails to overcome its division.
With the weight of the nation’s economy on his shoulders, President Obama stressed the need for bipartisanship in his acceptance speech last night.
‘In the coming weeks and months, I am looking forward to reaching out and working with leaders of both parties to meet the challenges we can only solve together,’ Obama said. ‘I believe we can seize this future together because we are not as divided as our politics suggests.’