Wednesday, December 5, 2018

Trump's Big Stupid Mouth Tanks The Stock Market

Mod: The Dow Jones Industrial Average fell just short of 800 points yesterday. Here are a few of the unfortunate reasons why it did.

JPMorgan warns investors that Trump’s tweets on purported China deal appear ‘completely fabricated’ (Raw Story link): A new note from investment bank JPMorgan advises traders to not buy into the hype that President Donald Trump has ended his own trade war with China. As reported by CNBC’s Carl Quintanilla, JPMorgan is telling investors that Trump’s declaration this week that China will immediately drop all tariffs on American cars has no basis in reality.

In particular, the note said that investors should have “valid reason for caution” when it comes to investing on the hopes that Trump is on the verge of a major breakthrough with China.

“It doesn’t seem like anything was actually agreed to at the dinner and White House officials are contorting themselves into pretzels to reconcile Trump’s tweets (which seem if not completely fabricated then grossly exaggerated) with reality,” the note states.

Shortly after a dinner meeting with Chinese President Xi Jinping during the G-20 summit in Argentina, Trump excitedly declared that China would eliminate tariffs on American cars and would also start bulk buying American soy beans once again. However, the only concrete measure to have come out from the meeting seems to have been a decision to not further escalate trade tariffs while the United States and China try to hammer out a new deal.

Mod: This next report comes from the usually pro-Trump Washington Examiner.

Trump's tariff tweets tank markets, and maybe the economy (The Washington Examiner link): No sooner had President Trump helped reinvigorate a badly listing stock market by finally talking nice about trade with China than he utterly ruined it by pronouncing himself “Tariff Man” in an astonishingly wrongheaded tweet.

The Dow Jones Industrial Average closed down 800 points (3.1 percent) for the day, almost entirely in response to Trump brandishing his trade-warrior regalia by saying that trade amounts to foreigners “raid[ing] the great wealth of our Nation.”

Just this morning, a Washington Examiner editorial noted that the markets had responded tremendously well to reports over the weekend of a trade truce between the U.S. and China. My editors perceptively warned that “if Trump's tariffs stand for long, or if this truce collapses and a trade war with China proceeds, the economy will suffer serious damage.”

Sure enough, Trump sent a message interpreted as a threat of continued trade warfare.

Immediately, the stock market tanked. This is par for the course for the last two months. Due to a number of factors, all major stock indexes suffered a horrid month of October and a wildly erratic November — but the worst downturns, even before the October swoon, repeatedly followed indicators, often from Trump himself, that trade tensions were growing rather than easing. Conversely, every single hint of a trade truce has produced a mini-rally.

'Chaos breeds chaos': Trump's erratic and false claims roil the globe. Again. (The Washington Post link): After his Argentine steak dinner last weekend with Chinese President Xi Jinping, President Trump announced that they had reached an “incredible deal” to temporarily suspend his trade war. But days later, Trump declared, “I am a Tariff man.”

Trump last week proposed stripping away electric-car subsidies from General Motors as punishment for the automotive giant moving to cease production at plants in the United States and Canada. But then his chief economic adviser, Larry Kudlow, said the White House would do no such thing. Targeting a single company, he explained, would be illegal.

"The Adventures of Tariff Man" video link
Then there is the way Trump talks about how the economy works — imprecise at best, ignorant at worst. For instance, the president routinely says that China and other countries are paying billions of dollars to the United States because of his tariffs. But that is false. Tariffs are paid by companies, often U.S. firms, that import foreign-made products. Once again this week, world leaders, U.S. lawmakers and jittery investors have been reminded that Trump’s words cannot always be trusted.

The whiplash nature of Trump’s economic policies and pronouncements bore tangible consequences on Tuesday, when U.S. stock markets cratered amid investor skepticism of Trump’s China talks. The Dow Jones industrial average dropped 799 points, or 3.1 percent, while the Standard & Poor’s 500-stock index fell 3.2 percent and the Nasdaq dropped 3.8 percent.

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32 comments:

  1. I have no idea what it will take to make trump shut the hell up.

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  2. His lying is catching up with him and having an impact.

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  3. I was thinking about dabbling in the stock market, I'm glad I didn't. Think I'll wait til he and his corrupt cronies are sitting behind bars.

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  4. Trump Is More Loyal to Dictators Than to the U.S.

    https://slate.com/news-and-politics/2018/12/trump-khashoggi-killing-lies.html

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  5. Those Top 10 stock declines are all Obama's fault. No, really!

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  6. Facebook allegedly offered advertisers special access to users' data and activities, according to documents released by British lawmakers
    https://www.washingtonpost.com/technology/2018/12/05/facebook-allegedly-offered-advertisers-special-access-users-data-activities-according-documents-released-by-british-lawmakers/

    Never use your own name on the Internet.

    ReplyDelete
  7. Can Trump Get Out of a Trade Crisis He Created?

    “Three days after Trump emerged from his dinner with Xi touting an ‘incredible’ deal, U.S. and Chinese officials were offering different accounts of whether there was a 90-day deadline for progress in new trade talks, the schedule for China to increase its purchases of American farm and industrial products, and Beijing’s plans to reduce or eliminate specific tariffs,” the Washington Post reports.

    Said Trump on Twitter: “President Xi and I want this deal to happen, and it probably will. But if not remember… I am a Tariff Man. When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so.”

    First Read: “Remember, this trade/tariff standoff with China is a crisis that Trump created, and it’s a crisis that he ultimately might not be able to solve, because he doesn’t understand that tariffs mean higher prices for American business and consumers.”

    https://politicalwire.com/2018/12/05/can-trump-get-out-of-a-trade-crisis-he-created/

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  8. I hope everyone understands that your 401k just lost money and your pension funds thanks to trump.

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  9. Trump On Coming Debt Crisis: 'I Won't Be Here' When It Blows Up

    Since the 2016 presidential campaign, Donald Trump’s aides and advisers have tried to convince him of the importance of tackling the national debt.

    Sources close to the president say he has repeatedly shrugged it off, implying that he doesn’t have to worry about the money owed to America’s creditors—currently about $21 trillion—because he won’t be around to shoulder the blame when it becomes even more untenable.

    The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the national debt in the not-too-distant future. In response, Trump noted that the data suggested the debt would reach a critical mass only after his possible second term in office.

    “Yeah, but I won’t be here,” the president bluntly said, according to a source who was in the room when Trump made this comment during discussions on the debt.

    https://www.thedailybeast.com/trump-on-coming-debt-crisis-i-wont-be-here-when-it-blows-up

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  10. How much do you want to bet that the Trump Organization is actively in the stock options game right now, making money on the market volatility he's causing?

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    Replies
    1. No doubt he and his cronies are doing just that.

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  11. IMHO: GOP may decide 45 is too toxic to be the candidate in 2020

    They're showing signs of mutiny already. If Lindsey Graham is screaming against the Saudi assasins, and Putin has dumped trump by submitting intel, and the massive blue wave, they may finally have decided that winning is impossible with the crybaby in charge.

    His rallies are eroding and his ability to throw insults is dwindling: He can't afford to just make cheap shots anymore. Their efforts to rig the vote were mostly insignificant.

    At some point, his 29% base isn't enough, and if the GOP is good at anything, it's crunching numbers. They never liked the idiot, and if he can't deliver ..

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  12. Trump business gets 30 subpoenas

    https://www.sourcepolitics.com/trump-hit-with-30-subpoenas-irs-and-other-entities-involved/

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  13. "There is no man smaller than the coward at a hero’s wake."

    Irish Proverb

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  14. How about taking a time out for the rest of the day to remember 41.

    ReplyDelete
    Replies
    1. The thing that impressed me the most from the service was how many of those speaking mentioned his decency, kindness and concern for others. Such a contrast to our current president.

      Delete
    2. That guy did some eveil stuff around the globe

      I won’t mourn him

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    3. I came away with the feeling that I was being told how to remember him.

      Delete
    4. You're with the right crowd here...

      Delete
    5. Where do you receive your orders?

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    6. The take out window, of course.

      Do you go in for your order?

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    7. Screw the funeral, I mowed my lawn.

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    8. 4:35 - served with a heel click I'll bet.

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  15. Where’s the Russian collusion? All the “witnesses” you had such high hopes for are being processed out and mueller was satisfied with some written responses.

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    Replies
    1. You need to watch something other than Fox News. They are keeping you on a pablum diet.

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    2. I think we need another Benghazi investigation

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    3. What would it be, the eleventh?

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  16. Trump is too low class to show any respect to anyone. A real man would have greeted the Clintons today. That plastic ‘wife’ he bought is one terrible role model for women. Can this nightmare please f ing end ?!?!

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  17. Rocket Man and Tariff Man. Maybe Putin can be Puppetmaster Man.

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    ReplyDelete
  19. It only took him two years to, just now, start to make tears in Obama's great administration and our already great America. There were mistakes, yes, but now you will start seeing something so unbearable damaging to our country. It will years to recover and again the new aggressive liberal democrats will have to take care of all the damage 45 and the GOP have made. Unless, everything he's destroyed can somehow be annulled!

    ReplyDelete

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