Originally published on April 6, 2018 by TheMarketMogul.com
One tweet can turn the market 1,000 points in hours. That's sick.
No Trade War
“We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S. Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion. We cannot let this continue!”
Early morning, Wednesday, April 4, 2018, trade wars dominated financial headlines. After weeks of volatile trading that had shaved more than 10% from the Dow Jones average, the most-watched futures contract was down another 500-plus-points. Attune to the news cycle, the President of the United States issued a blistering, yet simplistic tweet regarding what had the financial world’s attention—trade wars. Soon afterwards, the market started to rebound. Two hours later, President Trump broadcast a second tweet.
“When you’re already $500 Billion DOWN, you can’t lose.”
By day’s end, the market turned a massive loss into a whopping 230-point gain. Sixteen hours after his initial tweet, President Trump’s twitter followers had posted 22,000 replies, 27,000 retweets, and 105,000 likes. Forget other market analysis and rational for the huge turnaround. It’s all mumbo-jumbo. It was Trump’s tweet that ignited the equity market.
The master of manipulation, Trump stoked the children of the Reagan Revolution. He unleashed their animal spirits—again. In the ensuing hours they did what the Wall Street herd has been bred to do; Buy the Fucking Dip (BTFD). And they did the next day too. On Thursday, April 5, 2018, the Dow Jones Average added another 240 points, closing at 24,505. In total, a nearly a one-thousand-point swing occurred in little more than twenty-four hours—on a tweet. That’s sick.
It’s Fools Gold—or One of Dozens of Crypto-Currencies
Despite the market’s recent setback, Trump’s base still feels their oats. They believe nothing can stop a freight train. Give Trump another ego-boost and he’ll launch TrumpCoin. And it will be the greatest crypto-currency ever launched.
Truth be told, one clever little tweet may make a market for a day. In America’s narcistic fashion, it may last a week, month, quarter, even a decade or two. But Trump’s proud characterization of the ugly American will prove to be fatal. Because The American Brand Has Been Trashed Again. And it matters.
Thursday, April 5, 2018, 11:00 PM EDT
Hours earlier, #DoubleDownDonald threatened an additional one-hundred-billion-dollar tariff on Chinese products. The Dow Jones after-markets futures responded, losing approximately three-hundred points. Following months of uneasiness, the world has begun to call Trump’s bluffs. He will respond—with even more outrageous demands. Remember, these negotiations are about cars, steel, pork, soybeans, intellectual property and hundreds of other products. All important to each country and world trade. But what happens when Trump brings his ugly-American persona to next months talks with another leader high on his oats?
If a tweet by President Trump boasting how America has been screwed by the world can turn the Dow Jones Industrial Average positively one-thousand points in barely a day, what can happen when Trump Tweets “Bomb’s Away Little-Rocket Man!”?
Do you feel lucky? Go ahead. Buy the Fucking Dip (BTFD).