Donald Trump

Study: Trump’s Tweets Really Do Harm The Market

JM Ashby
Written by JM Ashby

It seems self-evident that the market drops almost every time Trump rants on his Twitter account, but Bank of America actually studied the phenomenon and assigned a numerical value to the cost of his tweets.

From MarketWatch:

Bank of America Merrill Lynch studied daily returns for the S&P 500 SPX on days when Trump writes more than 35 tweets in a day, versus those where he types fewer than five of them.

The broker found the difference was statistically significant, with a 9 basis point drag on days where Trump is pounding out tweets fast and furious versus a 5 basis point tailwind on days where he mostly stays off the platform.

I believe this is a conservative reading of the true cost and consequences of Trump's rage tweets but, in any case, Trump is truly breaking ground here as the first "president" who measurably dents the market on a daily basis by tweeting nonsense into the void.

I don't know who the next president will be, but I'm absolutely confident that this will not be a measurable thing with whoever it is.

  • muselet

    Random brain droppings from the President of the United States cause the stock market to underperform? Gracious me, what a shocking surprise.

    Oy.

    This is one of many reasons why previous presidents have been circumspect in their informal—and formal—comments. Even demonstrated nitwits like Ronald Reagan and George W Bush made a point of not shocking the markets with offhand trash talk.

    Donald Trump is unfit for the office he holds.

    –alopecia