On Monday, Donald Trump made a grandiose claim on Twitter.
In and of itself, that’s not “news”. He makes grandiose claims all the time. But this one was particularly silly and because it accompanied a new nickname for the Fed (“stubborn child”) it grabbed headlines.
Specifically, Trump claimed that, despite the Fed’s efforts to stop him, he had succeeded in engineering – and this is a direct quote – “one of the best Months of June in US history”.
That’s pretty bold, even for Trump. After all, America has seen a lot of “months of June” over the last two centuries, so claiming this is among the best, and then suggesting that you’re responsible for it, is rather presumptuous.
Fast forward to Tuesday and, perhaps realizing he needed to clarify what he meant by “best” (considering the US almost went to war with Iran five days ago), Trump explained that he was referring to the stock market. He then proceeded to thank himself, on behalf of you:
Stock Market is heading for one of the best months (June) in the history of our Country. Thank you Mr. President!
A couple of hours later, the The Conference Board delivered some bad news that seemed to contradict the president’s assessment of just how great this “month of June” really is.
Long story short, it looks like the trade conflict and the possibility of a shooting war with the IRGC are weighing on the American consumer. Consumer confidence printed just 121.5 in June, missing consensus (131.3) by a country mile. “After three consecutive months of improvement, Consumer Confidence declined in June to its lowest level since September 2017”, Lynn Franco, Senior Director of Economic Indicators at The Conference Board said. The 9.8 point MoM drop is among the largest declines since the crisis.
The present situation index fell to 162.6 versus 170.7 last month, while the expectations gauge dropped to 94.1 from 105.0.
“The decrease in the Present Situation Index was driven by a less favorable assessment of business and labor market conditions [and] consumers’ expectations regarding the short-term outlook also retreated”, Franco went on to say, adding that “the escalation in trade and tariff tensions earlier this month has shaken consumers’ confidence [and while] the Index remains at a high level, continued uncertainty could result in further volatility in the Index and, at some point, could even begin to diminish consumers’ confidence in the expansion.”
Forgive me, but it would appear that the US consumer doesn’t concur with the president when it comes to just how wonderful this particular “month of June” has been.
“Surprise! Everything stinks”, Bloomberg’s Luke Kawa wrote on Twitter. “Every subindex of the Bloomberg economic surprise index is in negative territory right now.”
But hey, look at the bright side: This is more fodder for Fed cuts.