Wednesday was a rough day for the stock market. The S&P 500 and the NASDAQ both fell, and the Dow Jones lost all its gains from this year.

It’d be easy to argue that this drop is bad news for President Trump and the GOP. Trump has spent a significant amount of time talking up the stock market and taking credit for the overall state of the economy. So if the market undermines Trump’s arguments about the economy, skeptical Republicans could bolt right before the midterm elections.

I don’t think this argument is bad or that it’s doomed to end up being wrong. But I’m not convinced that that’s what’s happening yet.

Economic factors generally don’t have a clear, 1-to-1 effect on midterm elections. Other studies have shown that while GDP growth and other major economic factors are helpful in forecasting presidential elections, their predictive power is much lower in midterms. Presidential approval, on the other hand, is helpful for forecasting what’s going to happen in midterm elections.

That’s because midterms are basically referendums on the president and his party, and economics are only one part of that story. Trump’s approval rating on the economy is actually decent – RealClearPoltics puts it over 50 percent. But his stances and attitudes on other issues (e.g. the tweets, the less-than-popular legislation, etc.) drag his overall approval down to somewhere in the low-to-mid 40s.

In other words, the stock market numbers don’t shoot directly into people’s brains and immediately affect their opinions of Trump and the GOP. They’re weighted alongside other issues, and they compete for mental space with other news stories like Khashoggi and bombs that are sent to politicians.

And the stock market is just one of many economic indicators. It’s possible that the stock market drops for a bit, starts to rebound, then ends up having no real effect on Trump’s approval because it doesn’t do much to shift the bigger, living, breathing economy. You could argue that that’s exactly what happened early in 2018


The first graphic is the daily returns on the Dow Jones since Trump’s inauguration and the second is presidential approval (as tracked by FiveThirtyEight) over basically the same period.

The stock market drop in early 2018 didn’t seem to have a big effect on Trump’s approval rating. That’s probably partially because other stories were driving public opinion (e.g. Trump’s approval was trending as the Tax Reform Bill brought some skeptical Republicans back into the fold and as the GOP’s unpopular ACA replacements left the headlines). But it’s also partially because, as far as I can tell, the broader economy was fine for much of 2018. I’m not an economist, so I don’t know the deep details of the numbers, but my lay understanding is 1) the stock market doesn’t always perfectly reflect what else is going on in the economy and 2) the economy seems to have been humming along well for most of the Trump Administration. And more broadly, the ups and downs of these two graphics don’t really match up with each other well.

So if a drop in the stock market fails to accompany broader economic problems, I’m not convinced that it’ll be a big enough deal to really shift the midterm results. That could happen, but as far as I can tell we’re not there yet.

That being said, the stock drop does highlight a risk for the Trump Administration. The overall health of the economy is one of Trump’s biggest strengths. It’s part of the reason that many lukewarm Trump supporters (I’m thinking of those who say they “somewhat” approve of the President’s job performance) are still behind him. If the economy goes bad, Trump could shed the some of the Republicans who aren’t all in on this iteration of the GOP, which could seriously harm his poll numbers.

But as far as I can tell, that hasn’t happened yet – and I don’t know enough about economics to make a good prediction about when a downturn will (or won’t) hit.

So far this stock market downturn hasn’t evolved into a full-blown economic downturn, and there’s less than two weeks between now and the midterm. Two weeks can feel like a solid decade given the pace of the Trump-ian new cycles, but there’s really only so much time for public opinion to change. Barring major changes (e.g. big economic news, an attack on US soil, etc.) I would guess that Trump’s approval rating won’t swing wildly before Election Day. In fact, I would guess that the midterms landscape will continue to look the way it’s looked for much of Trump’s presidency: like a referendum on Trump where the Democrats probably (but not certainly) have enough strength to take the House but likely don’t have the juice to take the Senate.