When Donald Trump offered some financial advice Wednesday morning, stocks were wavering between gains and losses.
But that was about to change.
“THIS IS A GREAT TIME TO BUY!!! DJT,” he wrote on his social media platform Truth Social at 9:37 a.m.
Less than four hours later, Trump announced a 90-day pause on nearly all his tariffs. Stocks soared on the news, closing up 9.5 per cent by the end of trading. The market, measured by the S&P 500, gained back about US$4-trillion, or 70 per cent, of the value it had lost over the previous four trading days.
It was a prescient call by the president. Maybe too prescient.
In a stunning reversal, U.S. President Donald Trump said he would temporarily lower the hefty duties he had just imposed on dozens of countries while further ramping up pressure on China, sending global stocks rocketing higher.
Reuters
“He’s loving this, this control over markets, but he better be careful,” said Trump critic and former White House ethics lawyer, Richard Painter, noting that securities law prohibits trading on insider information or helping others do so. “The people who bought when they saw that post made a lot of money.”
Democratic senators are calling for investigation.
“Did anyone buy or sell stocks, and profit at the public’s expense?,” said Democratic Senator Adam Schiff in a post on the platform BlueSky. Added Democratic Senator Chris Murphy of Connecticut on X, “An insider trading scandal is brewing.”
A key question is, was Mr. Trump already contemplating the tariff pause when he made that post?
“Over the last few days, I’ve been thinking about it,” said Mr. Trump himself when asked yesterday directly about when he arrived at his decision, but then added to the confusion, stating, “Fairly early this morning.”
Later, a spokesperson didn’t answer directly but defended Mr. Trump’s post as part of his job.
“It is the responsibility of the President of the United States to reassure the markets and Americans about their economic security in the face of non-stop media fearmongering,” wrote White House spokesman Kush Desai.
Another curiosity of the posting was Mr. Trump’s sign-off with his initials.
DJT is also the stock symbol for Trump Media and Technology Group, the parent company of the president’s social media platform Truth Social.
It’s not clear if Mr. Trump was saying buying stocks in general, or Trump Media in particular. The White House was asked, but didn’t address that either. Mr. Trump includes “DJT” on his posts intermittently, typically to emphasize that he has personally written the message.
The ambiguity about what Mr. Trump meant didn’t stop people from pouring money into that stock.
Trump Media closed up 22.67 per cent, soaring twice as much as the broader market, a stunning performance by a company that lost US$400-million last year and is seemingly unaffected by whether tariffs would be imposed or paused.
Trump’s 53 per cent ownership stake in the company, now in a trust controlled by his oldest son, Donald Trump Jr., rose by US$415-million on the day.
Trump Media was bested, albeit by only two-hundreds of a percentage point, by another Trump administration stock pick – Elon Musk’s Tesla.
Last month, Mr. Trump held an extraordinary news conference outside the White House praising the company and its cars. That was followed by a Fox TV appearance by his commerce secretary urging viewers to buy the stock.
Tesla’s surge Wednesday added US$20-billion to Mr. Musk’s fortunes.
Kathleen Clark, a government ethics law expert at Washington University School of Law, says Mr. Trump’s post in other administrations would have been investigated, but is not likely not to trigger any reaction, save for maybe more Truth Social viewers.
“He’s sending the message that he can effectively and with impunity manipulate the market,” she said, “As in: Watch this space for future stock tips.”
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