Where we are
So Trump announced yuuge “permanent” tariffs and the stock market indices all tanked. Then Trump backpedaled on all the big tariffs except on China. Why the Trump flip-flop? Here’s Josh Marshall over at TPM:
“Every sign is that it was not about the equities markets but rather the bond market, where the demand for U.S. Treasury bonds seemed to be softening as the global economy moved into crisis. That defies all the rules of the 21st century global economy. It means either something very, very bad or something armageddonly bad. The first is that banks and hedge funds and other big financial muckety-mucks were under so much cash-crunch stress that they were forced to liquidate Treasuries at any price. That points to a real danger of being on the precipice of a 2008-style financial crisis, albeit with very different drivers. The other possibility was that global buyers were losing the confidence in U.S. Treasury debt itself which is basically the sheet anchor of the modern global economy. Take that away and things get much worse for the United States and our global primacy starts to evaporate.
“What it all amounts to is that Trump had to cave in a way that all but his most diehard fluffers will recognize as humiliating. But he did that without actually undoing that much of the damage. Maybe any of the damage. And that’s where we are.”
So other than the insider trading he and is family are milking the markets for, Trump doesn’t know what he’s doing. It’s just economics kayfabe to him.
Trump’s tariff flip-flop
“Every sign is that it was not about the equities markets but rather the bond market, where the demand for U.S. Treasury bonds seemed to be softening as the global economy moved into crisis. That defies all the rules of the 21st century global economy. It means either something very, very bad or something armageddonly bad. The first is that banks and hedge funds and other big financial muckety-mucks were under so much cash-crunch stress that they were forced to liquidate Treasuries at any price. That points to a real danger of being on the precipice of a 2008-style financial crisis, albeit with very different drivers. The other possibility was that global buyers were losing the confidence in U.S. Treasury debt itself which is basically the sheet anchor of the modern global economy. Take that away and things get much worse for the United States and our global primacy starts to evaporate.
“What it all amounts to is that Trump had to cave in a way that all but his most diehard fluffers will recognize as humiliating. But he did that without actually undoing that much of the damage. Maybe any of the damage. And that’s where we are.”
So other than the insider trading he and is family are milking the markets for, Trump doesn’t know what he’s doing. It’s just economics kayfabe to him.
Trump’s tariff flip-flop
There is a possibility that the bastard was manipulating the stock market.
@Ken,
I’ve read that.
Correlation is not causation, but there is enough to warrant an investigation. The real question is what would happen if there were deliberate market manipulation happening? Right now my guess is nothing.
@Jane,
Of course. The DoJ is now a wholly owned subsidiary of Donald Trump Inc.
Some of his supporters may claim that he is very successful in keeping America’s enemies off balance.
@Crprod,
His supporters, many of whom can be found on Fox News, claim all sorts of nonsense. So what? A claim is not an argument I should pay attention to. YMMV.
From what I can see, this has nothing to do with keeping America’s enemies off balance. It’s about kayfabe. And allowing him and his family and friends to profit on insider trading.
Crprod:
As I just finished writing, China does not seem to be off balance on LNG, Indeed, they went elsewhere for much of their LNG. The US has deficit trade with many nations and such is also occurring with China.