Cartoon by Marian Kamensky
Trump’s one weird trick for better polling numbers won’t work
AlterNet: Donald Trump isn’t a smart man, but he knows how to manipulate the stock market. Not only is he allegedly engaging in market manipulation while president, but it’s a Trump con that goes back decades.
Back in October 2018, the New York Times published a Pulitzer Prize-winning profile of Trump’s extensive tax fraud schemes, and in the process of that reporting uncovered one of the ways Trump screwed with the financial markets. Journalists David Barstow, Susanne Craig and Russ Buettner reported that Trump would routinely engage in a scam known colloquially as “greenmailing.” It involved Trump, along with his father, Fred, as his “wing man,” exploiting the news media to pump up the price of a stock by planting rumors, devised by Trump himself, about a takeover. This would drive up the price of the stock, only for Trump to either sell or to demand “lucrative concessions from the target company to make him go away.”
All told, Donald Trump is a bit of an expert at blurting things that force the markets to bend to his will. And he’s engaging in similar shenanigans now, while Americans are dying by the thousands.
Before the pandemic and accompanying economic calamity hit us, it’s possible, while not proven, that Trump used his inexplicable trade war to seize control over the indexes. Since Trump launched the trade war with China in early 2018, whenever he’d announce good news about negotiations with Beijing — which were probably lies — the markets would rise. Whenever he’d announce bad news along those lines, the markets would collapse. We can see it in the charts: Since 2018, we’ve observed wildly unprecedented whiplash swings by hundreds of points in single days of trading, and most of those gains or declines were linked to the trade war.
Last year, Vanity Fair’s William Cohan published a mind-blowing item that closely examined several “chaos trades” and the linkage between Trump’s blurts and the movement of the S&P 500. Sure enough, someone — or a connected group of someones — was making colossal trades just prior to Trump’s announcements about the trade war. When I say “colossal,” I’m understating the magnitude of the windfalls these trades produced.
This year, the question we’re all asking is why the hell the markets are doing so well in the face of the coronavirus pandemic, not to mention the existence of a recession and a record-high budget deficit. As I write this on Monday, July 13, the Dow is up 452 points despite everything else collapsing around us. (At the end of the day, the Dow closed up just 10 points, due to bad news about the virus. More on this presently.) Astonishingly, the Dow has climbed 8,000 points since its pandemic low point on March 23.
Why?
Trump desperately wants to be re-elected this fall to avoid being prosecuted, not to mention getting crushed under an avalanche of incoming lawsuits. The presidency serves as his last best shield against true accountability. He knows as well as anyone that the economy is the only thing keeping him from an approval poll average in the low 20s, and a landslide victory for Joe Biden in November, similar to Barack Obama’s resounding victory in 2008. Consequently, Trump’s returning to some of his old tricks to try to keep the major market indexes happy, at the very least. Only this time, his tricks are exacerbating the pandemic and literally killing Americans, all for the sake of his re-election >>>
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