Are Markets Getting Suckered By Trump's Truth Socials? | Diving In
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What is the main topic discussed in this episode?
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Well, here we go again. President Trump just announced that he's calling off tonight's scheduled bombing of Iran. If you're keeping count at home, that's literally the fifth time he's done it so far during this war. He posted on Truth Social that, The discussions with Iran were going so well and they're at the highest levels of Iranian leadership that he's going to call off the strikes and he reassures us that peace is just about to break out. The Iranians are finally coming to heel. Now, I collected the most extraordinary data set. This sounded sort of familiar. So I went looking for how many times in the past President Trump has told us We're on the cusp of a deal, and it's a pretty extraordinary list.
In fact, two weeks before the war started, he said Iran wants to make a deal very badly. Then, of course, he started the war. And each and every day, not every day, he's taken a couple of days off, but every few days he's come out once again and told us we're on the cusp of ending the war. In fact, at this point, I counted 50 separate occasions over weeks Roughly 25 days, separate days, in which he's told us we're on the cusp of a war. In March, he said, we have points, major points of agreement. I would say almost all points of agreement. Mate, if that's true, what's taken so long? In April, he said, it should be days, not weeks. Well, it wasn't days. In May, he said, we're getting close to making a deal.
Well, sunshine, it's quite a bit later right now. Later in May, the end of May, he said the US is close to a deal. Well, we're almost halfway through June now. And a couple of days ago, he said we are very close to a final deal with Iran. In fact, if you collect all of the quotes, it's several pages of the president day after day, time after time, reminding us that we're on the cusp of victory. I want to juxtapose that. with something else. What we saw today was actually a pattern we've seen throughout this war, which is any time the president de-escalates, the American stock market goes up. And if you think about that, people are buying and selling stocks based on a bet about the future profitability of large American companies.
And so if you see the price of stocks go up when we de-escalate, that's markets saying that they believe that the future profitability of American firms will be higher if we don't escalate the war. And the flip side, by the way, is also true, which is every time the president has escalated, American stocks have fallen quite substantially. It's what led me to suggest that markets are reacting as if they believe that the Iran war will take a trillion dollars Possibly $3 trillion off the value of American equities, which is a huge, huge effect. Now, today what happened was the president announced for the 50th time, literally the 50th time that we're on the cusp of ending the war, and American stocks rose by 1%.
A natural question that I get from some people is, why do markets keep getting suckered by this? And I think I want to give you a different lens for thinking about this. Maybe it's not that markets are being suckered. In fact, that markets understand that the present only occasionally tells the truth.
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Chapters
4 chapters
1
What is the main topic discussed in this episode?
0:00–4:30
2
Why did Trump announce calling off strikes on Iran and how often has he promised peace on Truth Social?
4:30–7:15
3
How many times has the president claimed 'we're on the cusp' and what examples illustrate this pattern?
7:15–14:19
4
How do Truth Social de‑escalation posts correlate with immediate U.S. stock market moves?
14:19–14:44
Speakers
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