WASHINGTON — We stand by what we wrote on Wednesday — that an incumbent president’s greatest advantage is time (because you get four years to focus on the general election, versus just months for your eventual opponent).

But that advantage disappears if the economy goes south.

And that might be the biggest news over the last 24 hours: The state of the U.S. economy feels a lot more fragile than the traditional indicators suggest (like the 3.7 percent unemployment rate).

“Shares on Wall Street were off sharply. ... The S&P 500 was down 2.9 percent. And bond markets offered an ominous warning on American growth prospects, with yields falling to levels not seen in years,” the New York Times writes.

Additionally, “The financial jitters, which continued Thursday as markets in Asia were down in early trading, came after new data showed the German economy hurtling toward a recession and factory output in China growing at its slowest pace in 17 years.”

And this morning’s developments aren’t any brighter.

“Global stocks fell after China vowed to take ‘necessary counter-measures’ over U.S. plans for a new tariff on Chinese imports, compounding investors’ concerns about weakness in the global economy,” the Wall Street Journal says.

Bottom line: Trump’s political standing is already in dangerous territory, despite a historically low unemployment rate and a growing economy.

What happens if that positive economic news goes away?

But there’s also a challenge for Democrats, especially when it comes to tariffs and trade.

Can you promise to get tough on China and oppose free-trade agreements when it appears that those strategies have backfired? (And how do you out-Trump Trump on trade?)

Or do you take a more pro-free trade approach, which is contrary to where the left and organized labor are on the issue?

There isn’t an easy answer here for Democrats.

Tweet of the day

Have to assume Trump is freaking out because neither he nor the Fed identifiably caused today’s stock drop and it’s unclear his usual tools will do anything about it. — Josh Barro (@jbarro) August 15, 2019

Trump heads to New Hampshire

The negative economic news is the backdrop to tonight’s Trump rally in Manchester, N.H. at 7:00 pm ET.

“The state, which he lost by about 2,700 votes in 2016, is doing well economically, at least when using broad measures,” per the AP.

“But beneath the top-line data are clear signs that the prosperity is being unevenly shared, and when the tumult of the Trump presidency is added to the mix, the state’s flinty voters may not be receptive to his appeals.”

By the way, Trump has been blaming the Federal Reserve for the economic jitters – because it raised interest rates and then didn’t lower them enough.

But we remember when Trump was against low interest rates during Obama’s presidency.

“The Fed's reckless policies of low interest and flooding the market with dollars needs to be stopped or we will face record inflation,” he tweeted back in 2011.

Beto’s back

Beto O’Rourke this morning will deliver a speech from El Paso, marking his return to the 2020 presidential campaign after the deadly shooting last week that killed 22 people in his hometown.

“O’Rourke will recommit to holding President Trump accountable for the state of the country — and focus on the stakes of removing a president from office whom he has explicitly linked to the deaths of fellow El Pasoans, according to a senior campaign official,” NBC’s Garrett Haake writes.

“He’ll focus heavily on three key issues: racism, white supremacy and guns — and plans to propose what the campaign calls ‘new, bold solutions.’”

The good news for Beto: His campaign has a new sense of urgency and it’s getting newfound attention after his handling of the El Paso tragedy.

The bad news: This is, by our count, Beto’s second relaunch/reset (his first being when he junked his local campaigning strategy for a more national one).

And successful campaigns usually don’t get two relaunches/resets.

2020 Vision: Hickenlooper exits the race

We told you August would be a month when the 2020 Democratic field would winnow due to the heightened requirements to make next month’s debate stage.

And it seems we have the first casualty of August.

“Former Colorado Gov. John Hickenlooper is expected to drop out of the Democratic presidential race on Thursday, a source close to Hickenlooper told NBC News on Wednesday night,” Stephanie Ruhle and Alex Johnson report.

It’s still unclear if Hickenlooper would make a run for Colorado’s Senate race, or if he’s getting out of politics altogether.

On the campaign trail today

Pete Buttigieg and John Delaney stump in Iowa… Andrew Yang is in South Carolina… And Amy Klobuchar headlines a dinner in Arkansas.

Dispatches from NBC’s embeds

Elizabeth Warren brought out a comedic side to her campaign during a house party in New Hampshire, NBC’s Benjamin Pu reports: “As for the funny moments - why do I bring up the funny side of Warren’s campaigning style? I’ve had several voters tell me that Warren has better energy and charisma over Sen. Bernie Sanders, her policy contemporary. These two incidents I flagged above really killed with the crowd, and they were, as far as I can tell, unscripted. The crowd always leaves energized and hopeful and cheerful, by their own admission.”

Amid yet another shooting gaining national attention, Pete Buttigieg spoke about the limits of the 2nd Amendment during a house party in Iowa. NBC’s Maura Barrett relays Buttigieg’s comments: “When one of your friends gets that look in their eyes and says, ‘Look, you can't do anything because that's unconstitutional 'cause that would be infringing.’ And the word ‘infringe’ is in there. One thing you can do is remind them that the word ‘well-regulated’ is in there too."

Data Download: The number of the day is … 5

Five.

That’s the number of times — before yesterday — that there has been an inversion of the yields on the 2-year and 10-year Treasury notes since 1978.

From our colleagues at CNBC: “There have been five inversions of the 2-year and 10-year yields since 1978 and all were precursors to a recession, but there is a significant lag, according to data from Credit Suisse. A recession occurred, on average, 22 months after the inversion, Credit Suisse shows. And the S&P 500 actually enjoyed average returns of 15 percent 18 months after an inversion before it eventually turns.”

The Lid: “While I breathe, I hope”

Don't miss the pod from yesterday, when we reported on the latest polling out of South Carolina.

ICYMI: New clips you shouldn’t miss

NBC's Jonathan Allen: "The GOP would like Steve King to kindly shut up."

Trump is talking to lawmakers of both parties about gun control.

The president isn't exactly going out on a limb as tensions simmer in Hong Kong.

Another day, another Biden-family/Ukraine story.

And broken bones in Jeffrey Epstein's neck are raising more questions about his death.

Trump Agenda: On edge

Here's the latest on how the recent combination of hate and violence has minority communities on edge.

The New York Times tells the story of an heiress whose riches still fund some of the country's biggest anti-immigration organizations.

2020: “Trumpgret” in New Hampshire

Some voters in New Hampshire are feeling "Trumpgret."

Harry Reid says he wishes Al Franken would run again.

Not everyone in New Hampshire is happy about Corey Lewandowski's Senate ambitions there.

Kamala Harris has unveiled a plan for online gun sale background checks.