Those of you steeped in the market zeitgeist don’t need me to tell you that last week will be enshrined in the history books.
Monday was the worst day for US equities since the crisis, a day which will live in infamy, not just for the scope of the decline, but for the extent to which it effectively marked the collision of two black swans – the coronavirus and the Saudi/Russia oil price war. Thursday was the single-worst session on Wall Street since 1987.
After a week like this one, you’d be inclined to think that Donald Trump had been humbled – if for no other reason than because, like the rest of us, he’s been reminded that we all occupy this planet at the pleasure of Mother Nature. At any given time, she can evict us.
But this is Donald Trump we’re talking about, a man who doesn’t understand the concept of “humble” and surely doesn’t know the meaning of the word “hubris”.
So, on Friday evening, the president was handing out autographed copies of Friday’s Dow chart.
I wish I was kidding, but I’m not.
Hopes for stimulus tied to the emergency declaration, hedge monetization, short covering and your standard, late-session, “up”-day squeeze managed to push the S&P to its best day since 2008 as Trump spoke in the Rose Garden. The benchmark closed an eye-popping 9.2% higher, after plunging the most in nearly 34 years the previous day.
It says a lot about the week when a 9.2% Friday gain still leaves you with the second-worst stretch since the financial crisis. But that’s where we were when the closing bell sounded.
Because I imagine not everyone who reads this will be the market “type”, let me emphasize: Even after Friday’s gains, this was still the second-worst week for Wall Street since the financial crisis. If you’re wondering when the worst week for stocks since the GFC was I’m happy to answer: It was the week before last (see the chart in the bottom pane above).
Donald Trump has, over the last three weeks, presided over:
- the worst day for US stocks since the 1987 crash,
- the worst week for US stocks since the crisis,
- the second-worst week for US stocks since the crisis,
- the end of the 11-year-old bull market
Not all of that is his fault, but some of it is. For example, stocks likely wouldn’t have plunged on Wednesday and Thursday had he not overpromised and underdelivered on the federal government’s virus response effort.
Despite all of the above, Trump sent Fox sycophant Lou Dobbs an autographed copy of Friday’s Dow chart. Dobbs, unable to contain himself (or, more likely, under pressure from the network), showed it on air. Here is the clip:
Suffice to say that even if we’ve seen the lows, there’s more turbulence ahead. Trump should be preparing his aides and advisors for how to craft a coherent message for voters in the face of an almost certain recession, rather than signing autographs after two of the worst weeks for Americans’ 401(k)s since the financial crisis.
I’m guessing he won’t be autographing this chart:
On Saturday morning, Trump tweeted this: “BIGGEST STOCK MARKET RISE IN HISTORY YESTERDAY!”
It takes a special kind of psychopath to be so proud. The Clown that Killed the Bull Market!
Bull markets don’t die of old age, but you can always take them out on 5th Avenue and shoot them.
https://twitter.com/KitCloudKickur/status/1238489486167871488/photo/1
Captain Numbskull and crew sail the ship of state over the edge of their flat earth, into the Abyss of Denial.
Trump is a f..ing idiot!!!
Lindsay? Is that you?
Should have raised rates a long time ago. Maybe this wouldn’t have happened
I just got to thinking. Once it was a flood. Then came the plague. Ever think this is the only way to really drain the swamp. An awful lot of emperors with no clothes these days.
A couple of tweets from Sven Henrich say it all.
https://twitter.com/NorthmanTrader/status/1238803320548007937
https://twitter.com/NorthmanTrader/status/1238440368816955394
Living amongst the reddest of Red Staters in the reddest of red regions I can tell you that in public they were all towing the “can you believe how ridiculous this is?”. (Hyped corona) I was asked this again and again on my long trip to the capital which took me through a flaming red region of the hill country that made me thankful of the midwest early trade and migration influence owing mainly to once being central Comancheria that has left us with a bit more congenial but by no means less Texan: especially in the sense that Texan has become caricature via bush/trump influence on the weak minded proud. So when I rolled into the old home city of 18 months of my twenties in the late nineties I was relieved and very proud to find it still had that same vibe which for Austin residents is a resonance with the space around them, a general happiness with their surroundings and a friendliness that is not contrived. A true collective confidence in themselves. The Texas of my youth.
No they were not exasperated by the “hype” they were taking measures while still living there lives. Due to my drive and my business “I stepped in” later than I wanted and that was a good thing. Si I can take very little credit. But I can give it due here to H, for aiding my brain in protecting my dry powder. I also know if is likely to slump further but again contingencies are on tap.
On my return home again with the “can you believe this hype”. I took the next day off the largest market decline since 1987 and hammered it pretty good again. The following day and mind you this is a scientist :can you believe this hype”. It is not in my best career interest to talk politics but I had to say ” a good way to find the truth is to follow the money, and the money spoke yesterday: that was not hype”. Obviously trumps chart for the next day also reveals a truth. The truth is he and his inexperienced cadre created the plunge with their inaction and lack of credibility; it took a declaration of a national emergency to give people the confidence that he might take this seriously, in order to invest in the ripe market. Their hands were still shaking as they plucked the low hanging fruit.
Will he also sign the vanishing Social Security and pension checks of the next several generations of retirees that he just doomed?