Nobody was happier to take credit for surging stocks than President Donald Trump, who touted and tweeted each leg up. Now the bull is on life support and the search for its potential killer is on.
And while many on Wall Street share the president's frustration with the man atop his markets enemies list, Federal Reserve Chairman Jerome Powell, they say Trump himself risks making things worse with too much aggression when equities are one bad session away from a bear market.
"You would think that after coming off of the worst week for the markets since the financial crisis in 2008, he would look to create some stability," said Chuck Cumello, chief executive of Essex Financial Services. "Instead we get the opposite, with this headline and more self-induced uncertainty. This coming from a president who when the market goes up views it as a barometer of his success."
Attempts by Treasury Secretary Steven Mnuchin to reassure markets that Powell wouldn't be ousted appeared to have largely removed that as an immediate concern for traders, but the secretary's tweet Sunday that he called top executives from the six largest US banks to check on their liquidity and lending infrastructure added to anxiety.
To be sure, equities remain solidly higher since Trump took office. Even with its 17 per cent drop over the last three months, the S&P 500 has risen 18 per cent since Election Day.
The Nasdaq Composite Index is up 25 per cent with dividends. True, volatility has jumped to a 10-month high, but market turbulence was significantly worse for three long stretches under Barack Obama.
The S&P 500 slumped 7.1 per cent last week and the Nasdaq Composite Index spiraled into a bear market.
While Trump seems to have found his villain in Powell, blame is a dubious concept in financial markets, as anyone who has tried to explain the current rout can attest.
Along with the Fed chairman, everything from rising bond yields, trade tariffs, falling bond yields, Brexit, tech valuations and Italian finances have been implicated in the downdraft that has erased US$5 trillion from American equity values in three months.
Whatever's behind it, nothing has been able to stop it. And while many on Wall Street credit the president for helping jump-start the market after taking office, they say he should look in the mirror to see another person creating stress for it right now.
"Trump was gloating how much good he had done for the economy and the market. Now he's blaming Powell for the decline instead of himself," said Rick Bensignor, founder of Bensignor Group and a former strategist for Morgan Stanley. "Half his key staff has been fired or quit. The markets are off for a variety of reasons, but most of them have Trump behind them."
If Trump is bent on getting rid of Powell, there may be ways of doing it that don't risk kicking a volatile market into hysteria, said Walter "Bucky" Hellwig, a senior vice president at BB&T Wealth Management in Birmingham, Alabama.
"It doesn't have to be firing, it could be someone else taking Powell's job. That could be a net positive for the markets," Hellwig said. "A friendly change in the head of the Fed may cause some turbulence short-term but it may be offset with the markets repricing the risk associated with two rate hikes in 2019."
For now, the turmoil shows no signs of letting up. In the Nasdaq 100, home to tech giants like Apple and Amazon.com, there have been 17 sessions with losses greater than 1.5 per cent this quarter, the most since 2009. Small caps are down 26 per cent from a record, while the Nasdaq Biotech Index has dropped at least 1 per cent on seven straight days, the longest streak since its inception in 1993.
It's been a long time since anyone in the US has lived through this protracted a decline. Including Trump.
"It's impossible to tease out what the proximate causes are," said Kevin Caron, a senior portfolio manager at Washington Crossing Advisors. "The normal ebb and flow of financial markets are all part of the mix. It's impossible just to point to the chairman as the only input."