So Trump fucked everyone to start the quarter and if you’re surprised, you shouldn’t be.
It was just 18 hours ago when we said the following in our week ahead preview:
Amazon has fallen 3% or more for two consecutive weeks, so we’ll see if Trump’s tweets are enough to dissuade any potential dip buyers:
At some point it’s going to be imperative that anyone who is managing money and simultaneously clinging to the idea that there’s some “plan” or “strategy” or whatever else behind Trump’s actions give up on that notion. I realize it’s difficult for a lot of people to come to terms with the idea that everything they’ve been saying to pseudo-rationalize this presidency is dead wrong, but it’s time to throw in the towel. He’s a moron. That’s just all there is to it. He spent Easter weekend accusing Jeff Bezos of conspiring against the post office and then tried to unilaterally cancel NAFTA based on a Fox & Friends segment he saw about migrant caravans. Somewhere in there he complained to Don King about porn stars and had dinner with Sean Hannity.
Fast forward to midday Monday and Amazon is in the midst of its worst one-day decline since October of 2016 thanks to this morning’s Twitter tantrum:
In many respects, the English language is an insufficient tool when it comes to capturing and communicating the sheer absurdity inherent in this, but the fact that Bloomberg has to write things like “tech shares tumbled after President Trump renewed attacks on Amazon and its relationship with the U.S. Postal Service,” is beyond surreal.
Over the weekend, we spent a considerable amount of time detailing just why this is so dangerous, and if you missed it, you’re encouraged to review the piece Owen Davis wrote over a year ago for Harper’s. Here’s a key excerpt:
Many economists worry that Trump could preside over a fundamental realignment of government-business relations and usher in an era of naked corruption. Matthew Mitchell of the Mercatus Center explained that when leaders direct punishment toward selective companies, “You’re really just inviting firms to ingratiate themselves to policy makers.” Take antitrust regulation, an area of policy where candidate Trump made occasional anti-monopoly rumblings. So far, Trump has only expressed concern over monopolies that involve his political enemies. He has condemned Amazon, whose chief executive Jeff Bezos owns the Washington Post, and opposed the merger of AT&T and Time Warner, which owns the cable-news network CNN. Analysts have mused that Trump may make the deal contingent on Time Warner dropping CNN.
The message is clear: show loyalty to Trump and reap the rewards.
The more Trump moves to surround himself with sycophants and hardliners, the more prone he’s going to be to these autocratic shifts. Have a look at the Amazon ‘VIX’:
A lot of that spike is down to Trump. He is singlehandedly and purposefully manipulating the share price of one of the most important companies in the world and he’s doing it vindictively based not on any real concern for the U.S. Post Office, but rather as “punishment” for The Washington Post’s editorial line.
So if you’re an Amazon shareholder or really, if you’re long stocks in general, just consider what’s going on here. The President of the United States is purposefully tanking the stock market because he doesn’t like the coverage he’s getting from one of the nation’s most important media outlets.
And don’t say we didn’t warn you, because when tech was rallying last Thursday to close the quarter, we suggested the bounce was likely to be fleeting in a post called “If Jeff Bezos Doesn’t Stop All This ‘Winning’, Donald Trump Might Just Have To Tank The Stock Market.”
— Donald J. Trump (@realDonaldTrump) April 2, 2018