When President Donald Trump speaks, financial markets gyrate and quiver in real time.
But that hasn't stopped the president from holding forth almost daily about the coronavirus pandemic and its economic implications without waiting until markets have closed for the day.
While many of his predecessors worked consciously to not affect the markets, Trump has overtly made market movements and performance a measure of his effectiveness and central to his argument for a second term.
Earlier this week, public health officials announced a surge of infections in the U.S. as leading economists predicted unemployment spiking to 10% or more. Trump, meanwhile, took the White House podium in the middle of the trading day to offer an optimistic take on his administration’s response to the crisis.
“One of the elements that is being worked on very much so on the Hill is to keep the jobs going so that when we do get rid of the virus, we're going to be able to just really...go like a rocket,” said Trump on Thursday as at the market spiked more than 300 points, then dove into negative territory and then inched back into positive territory over the course of his 77-minute press conference. “I think the economy is going to be fantastic.”
The president headed to the same place again on Friday while the markets were open for an even longer news conference, where he vacillated between expressing optimism and lashing out about “nasty” journalists' negativity.
Amid more difficult news—the number of confirmed infections around the globe surpassed 250,000 cases—the Dow Jones industrial average closed down more than 4.5% on Friday.
At the end of the market's heaviest losses in more than 30 years, the market closed at 19,173.98, below where it stood on the day before Trump was inaugurated and erased the so-called “Trump bump” that he's pointed to throughout his presidency as evidence of his prowess as the economic steward.
Nevertheless, in the midst of one of the most volatile moments ever for the U.S. economy, Trump has wagered that his voice is the daily balm needed to soothe investor concerns.
Over the course of the last eight days--all on which he held extended news conferences about the coronavirus response in the midst of trading -- his comments haven’t stopped the bleeding. The Dow has lost more than 17% since March 13, and has plummeted more than 34% since the market hit an all-time high Feb. 19.
The president’s decision to offer daily affirmations to the health of the stock market, and the economy writ large, is not surprising. But no president has tied his fortunes to Wall Street more closely than Trump, who until the market crash bragged that the rising stock market was evidence of his success leading the economy.
“Maybe, he should take it offline,”’ said Mark Zandi, chief economist for Moody Analytics. “But this president? He’s not going to do that.”
Jimmy Carter, George H.W. Bush, and George W. Bush avoided talking about the stock market with substance, let alone trying to impact the market in the midst of trading. Bill Clinton took to heart his economic adviser Robert Rubin’s advice that markets go up and markets go down.
Barack Obama was ridiculed as the stock-picker-in-chief less than two months into office when he suggested in the midst of a market slide that it was a good time to buy undervalued stocks.
For much of his next six years in office, the 44th president was often measured when even talking about the improved health of the economy: his first term started in throes of the Great Recession but he left office with 75 straight months of job growth. By the latter part of his presidency, Obama began claiming credit for the bull market on occasion.
“The stock market is booming,” Obama declared in a speech in a July 2014 speech in Kansas City.
Those close to Trump said he was fully aware that the coronavirus posed an enormous threat to the very same once-booming markets he touted as the calling card of his presidency, even as he was publicly downplaying concerns about the virus.
In the weeks that the pandemic ballooned into a public health emergency, Trump had become increasingly frustrated as he privately expressed concerns to his advisers about the effect the virus could have on the markets and ultimately his reelection effort, according to White House officials and Republicans close to the West Wing.
Trump throughout his presidency has viewed the market's performance as his “daily report card" of his job performance, Zandi said. With the pandemic thrusting the economy toward a recession, Zandi said that Trump now appears to be turning to the market for an “hourly report card” to gauge the effectiveness of his response.
“In the past, sometimes it worked and sometimes it doesn’t,” Zandi said of the president’s years-long cheerleading of the market. “Recently, it hasn’t. He’s in fact, as of late, done less to instill confidence and more to upset investors. They don’t view his actions as very productive in terms of this crisis. It’s worked against him.”
Throughout his presidency, Trump has used off-the-cuff diatribes to try to shame major, publicly-traded companies whose business dealings are at odds with his political interests, tapped out timely, friendly tweets about China’s Xi Jinping to calm market concerns about trade wars, and repeatedly berated Federal Reserve Chairman Jerome Powell about the central bank’s policies during market dips.
Trump has repeatedly made clear that the battered market is top of his mind, as trillions of dollars in wealth and nearly all the gains for the Dow Jones Industrial tallied since his inauguration have been erased. He has sought to will a comeback with his daily updates about his administration’s efforts to contain the virus in the midst of trading day, Zandi said.
It mostly hasn't worked.
Trump held a Rose Garden press conference on March 13, just before the New York Stock Exchange closed for the weekend, to declare a national emergency, to announce greater availability of virus testing kits were in the pipeline, and to declare he was ordering the purchase of oil for the Strategic Petroleum Reserve.
Later that weekend, he boasted during another news conference that the market responded to his performance with its biggest single-day gain ever. Left unsaid by the president was the fact that market had its single-worst day since the 1987 Black Monday the day before the record gain.
“I think we should do one of them every day, perhaps. How about five times a day?” Trump remarked. “We’ll do one five times a day. But that was something to watch and — I had no idea.”
The huge Friday gains that Trump bragged came from his market-whispering were followed by a wipe-out Monday that saw a historic, nearly 3,000-point slide for the Dow.
Investors dumped stocks after the Fed's surprise move on Sunday evening to cut interest rates to near zero, a move that appeared to only exacerbate investor worries about a global recession. The Fed rate cut came the day after Trump again publicly berated Powell over lending rates.
Jason Furman, a Harvard University economist who served as Obama’s chief economic adviser, said Trump should provide important coronavirus updates whenever he and his team sees fit. But Furman also advised that Trump should “let the stock market take care of itself.”
Diane Swonk, chief economist at Grant Thornton, said the “genie is out of the bottle” with Trump’s consistent attempts to shape the market through Twitter and the media. And with the global nature of the marketplace, when Trump makes his comments remains less important than the substance of his remarks, she said..
“This is where facts matter, information matters and very focused communication matters,” Swonk said. “His experts should be all the focus. His job should be to be the steward right now. Often, the alpha dog isn’t the first one in the pack.”
Associated Press writer Zeke Miller contributed reporting to this article.