Trump Keeps It Comin’, Threatens To ‘Simply’ Tax European Cars In Saturday Rant

Headed into Friday, more than a few commentators suggested that Donald Trump was likely to try and tone down the shrill trade rhetoric after witnessing the market reaction to his tariff announcement.

We thought that was likely too. How silly of us. It’s almost like we forgot who we were talking about for a minute.

See the thing about Trump is that his knee-jerk reaction when something he says or does isn’t greeted with praise (so, basically we’re talking about damn near everything he says and does) is to lash out on Twitter in an effort to “explain” why he’s right and everyone else is wrong. Usually, he’ll employ lots of all-caps and superfluous punctuation in the service of trying to effectively drown out dissension with an overwhelming show of bombast. That almost always backfires for two reasons: 1) he’s almost never right to begin with, and 2) he almost invariably does something to make the situation worse like misspelling a word or hurling absurd insults at sitting Senators or say, his own Attorney General.

Such was the case on Friday morning when the President, undeterred by everyone in the world (and in this case we mean that almost literally) telling him in no uncertain terms that starting a trade war was a potentially catastrophic thing to do, woke up before dawn and doubled down, insisting that not only are trade wars “good,” they’re also “easy to win.”

Then, in a complete non sequitur, he called Alec Baldwin “Alex” Baldwin and characterized his career as “dieing” (as opposed to “dying”). He would later delete that and fix the spelling errors. All of that before dawn on Friday.

Needless to say, that didn’t inspire a whole lot of confidence and neither did reports that the decision to “announce” the tariffs blindsided literally everyone in the White House save Wilbur Ross and Peter Navarro.

Markets didn’t like any of that and although stocks managed to limp into the weekend without incurring much in the way of further damage, there’s a palpable sense of incredulity in the air.

“The S&P 500 fell by 1% on the day of the tariff announcement and at one point was down nearly 4% this week before rebounding to close down 2%,” Goldman notes, recounting the action. “Unsurprisingly, this week’s sell-off was most acute in Materials and Industrials while Telecom and Consumer Staples outperformed,” the bank continues, in a note out Friday evening.

Well, if everyone was incredulous on Friday, they’re even more incredulous now because wouldn’t you know it, Trump was back on Twitter Saturday to ratchet up the rhetoric some more. To wit:

The United States has an $800 Billion Dollar Yearly Trade Deficit because of our “very stupid” trade deals and policies. Our jobs and wealth are being given to other countries that have taken advantage of us for years. They laugh at what fools our leaders have been. No more!

— Donald J. Trump (@realDonaldTrump) March 3, 2018

If the E.U. wants to further increase their already massive tariffs and barriers on U.S. companies doing business there, we will simply apply a Tax on their Cars which freely pour into the U.S. They make it impossible for our cars (and more) to sell there. Big trade imbalance!

— Donald J. Trump (@realDonaldTrump) March 3, 2018

To be clear, Trump is setting the stage for further market turmoil next week, a week that also features the February jobs report.

In case it’s somehow slipped your mind, the above-consensus AHE print that accompanied January payrolls was the straw that broke the camel’s back and triggered the early February selloff.

So you know, look out.

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