President Donald Trump loves gloating about the (worsening) economy almost as much as he loves posting. Unfortunately for him, his need to tweet appears to share some correlation with the stock market going down the tubes.
The stock market (which is not exactly the best economic indicator) has been taking a beating recently, due in no small part to Trump’s ongoing trade war with China and the clusterfuck of a Brexit that he’s supporting. But that might not be all the damage he’s doing to the stonks: according to a Tuesday report by Bank of America Merrill Lynch, days where Trump is tweeting more often than normally have tended to track with stock market losses, and vice versa. Per CNBC:
The brokerage’s chief equity strategist, Savita Subramanian, wrote in a note that “since 2016, days with more than 35 tweets (90 percentile) by Trump have seen negative returns (-9bp), whereas days with less than 5 tweets (10 percentile) have seen positive returns (+5bp) — statistically significant.” A basis point is 0.01 percent.
In other words, when Trump tweets more than usual, the stock market tends to fall slightly, on average.
Today, Trump has done a bunch of tweets and retweeted the weather. The Dow Jones Industrial Average also closed nearly 300 points down. Hmmmmmm.
Does correlation equal causation? No. Are you reading FiveThirtyEight right now? Also no, so believe me when I tell you that Trump’s tweets are making the stock market take a big doo doo.