Whiplash.
Trump announced a giant policy switch in the last sentence of a Truth Social post.
We just witnessed a spectacular case of market manipulation. Was it careless? Or was it corrupt?
Maybe the announcement of a "pause" on tariffs was just careless, impulsive incompetence. Trump is a free-wheeling gut-instinct decisionmaker, who understands the value of unpredictability. His apparent impulsiveness preserves the idea that Trump is crazy enough to do just about anything, so beware. It is a negotiating tactic. Maybe there is nothing nefarious; this was just Trump being the erratic inconsistent showboat we have watched for years. Apply Occam's razor: maybe it was just simple incompetence, plus a little of Trump wanting to make his own social media platform essential reading.
Maybe it was pure crony corruption. That, too, is Trump being Trump. He openly and publicly rewards his friends. It would be so easy for Trump to do it here, and he gave himself an alibi by having put his "stock tip" right there in the open. He said to buy. Maybe some friends got rewarded with a heads up that he meant buy right now, before he reversed policy later that morning. In the case of Trump, the simple, straightforward Occam's razor presumption would be that a few people got tipped off. Friends help friends make money.
Trump began yesterday with two back-to-back posts on Truth Social reiterating his steadfast support for his tariff policy. After the 10:18 a.m. Truth Social post, the markets jumped. He wasn't sticking to his guns after all. Whew! The S&P500 moved up 9.5 percent; the NASDAQ moved up 12 percent. A hedge fund friend with a hint of Trump's upcoming reversal could have purchased options or futures contracts that would have doubled or tripled their money within hours.
Trump's announcement did not need to take place the way it did. He could have told the exchanges that he had an Oval Office announcement and to pause the exchanges for the announcement. He could have made the announcement. Then the exchanges would have reopened with all market participants having access to the same market-moving information at the same time. That procedure would have sent a message of competence and fair markets.
The fact that Trump chose to announce the tariff reversal the way he did is also a message: Trump does whatever the heck he wants, when he wants, and if some people get rich and other people get blindsided, so be it. Trump is in charge.
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2 comments:
It's no coincidence he cites the Gilded Age with such approval. Plenty of slimy, back door stock manipulation back then. Except now we have the likes of Diamond Jim Fisk in the White House, with the world economy in the balance as well.
Naturally, he sees his own interests as corresponding with the nation's interests. The only brake in my view is that he wants to go down in history as a successful statesman as well as salesman. Consensus thief and wrecker he can't afford.
People who commit fraud can not be trusted. To act on what a liar says is foolish. If people place financial bets on what Trump says, go ahead. I’ve had inmates look me right in the face and lie and when proved wrong two minutes later have to admit they had lied. News flash- Trump can not be trusted. Believe only what he does, not what he says.
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