[Source/Observer Network Wang Kaiwen] Last week, US stocks plummeted sharply due to Trump's new tariff policies. Amid the market chaos, Trump suddenly posted on his self-created social platform "Truth Social" at 9 a.m. local time on April 9, calling for "buying" US stocks.
A few hours later, Trump made a major policy reversal, suddenly announcing a "90-day suspension of tariffs," causing a strong rebound in US stocks.
This change quickly triggered American public opinion questioning Trump's "market manipulation" and "insider trading." Democratic lawmakers immediately followed up, calling for an investigation. Some people demanded that members of Congress who recently bought US stocks disclose relevant information.
Previously, it was reported that Trump had made a fortune due to "issuing coins." Analysts pointed out that Trump's post calling for buying US stocks might trigger an investigation by the US Securities and Exchange Commission (SEC).
"The US President has participated in the world's largest market manipulation plan."
"Calm down! Everything will be fine. America will be stronger than ever before." In the morning, soon after the opening of the US stock market, Trump posted on his Truth Social account.
Four minutes later, Trump urged the public to buy US stocks in another post: "Now is a good time to buy!!! DJT"
DJT is an abbreviation for Trump's initials, and according to AP, Trump sometimes uses DJT in posts to emphasize that he personally wrote them. However, DJT is also the stock code for Trump Media & Technology Group, the parent company of the Truth Social platform.
At around 1:30 p.m. on the afternoon of the 9th, Trump announced a 90-day suspension of "reciprocal tariffs" on multiple countries, causing the three major US stock indices to soar. The Nasdaq index surged by 12%, marking its largest single-day gain since 2001, the S&P 500 index rose by 9.5%, and the Dow Jones index increased by 7.9%.
By the close of trading on the 9th, Trump Media & Technology Group's stock price rose by 21.67%, far outperforming the broader market. Trump holds 53% of the shares in this company. Tesla, whose CEO is Elon Musk, saw a 22.69% increase.
Meanwhile, Democrats severely questioned Trump's "manipulation of the market."
"The US President has actually participated in the world's largest market manipulation plan." A Democrat on the House Financial Services Committee wrote on their social media account.
Screenshot of the House Financial Services Committee - Democratic X account
"Trump's unpredictable tariff policies are causing massive market fluctuations, and the constant changes provide dangerous opportunities for insider trading." Senator Adam Schiff from California stated, and questioned, "Who knew about Trump's latest tariff policy shift in advance? Who bought or sold stocks to profit from the public interest?"
"I am writing to the White House, the public has the right to know." Schiff said.
"In the few minutes before announcing the 90-day suspension of tariffs, the volume of NASDAQ phone trades surged. This is not a good sign." Spencer Hakimian, founder of hedge fund Tolou Capital Management, wrote.
New York Democratic Federal Representative Alexandria Ocasio-Cortez retweeted Hakimian's post, stating that any member of Congress who purchased US stocks in the past 48 hours should disclose relevant information.
"I hear some interesting discussions." Cortez said, "We're about to find out some things, it's time to ban insider trading in Congress."
Screenshot of Alexandria Ocasio-Cortez X account
Senator Elizabeth Warren of Massachusetts called for an investigation into whether Trump "benefited his Wall Street donors through market manipulation," while "working-class people and small businesses paid the price."
"Did Trump help insiders profit from his unpredictable tariff policies? It looks like corruption." Warren wrote.
"I have questions about today's tariff announcement, who benefited? Who made money?" Senator Chris Murphy of Connecticut said in a video posted on X, "People who invested in the early morning session likely made a lot of money. So the question is, who in Trump's circle knew he would suspend tariffs? Which of his Mar-a-Lago friends or billionaire advisors could use this inside information?"
Senator Richard Blumenthal of Connecticut criticized the Trump administration as being full of "scoundrels" during an interview with NBC on the 9th, stating that "corruption is their middle name."
"How is this not market manipulation?" said California Democratic Congressman Mike Levin, "If you're a supporter of Trump and followed what he said and bought stocks, you did well. But if you're retirees, elderly people, or middle-class individuals who decided to sell stocks in the past few days because they couldn't take the risk, you're in trouble."
The White House rebutted the accusations of market manipulation late on the evening of the 9th. White House spokesperson Kush Desai stated in a statement: "In the face of panic spread by the media, it is the responsibility of the US President to assure the market and Americans of their economic security."
On social media, there were also netizens mocking Democrats for "insider trading": "Why don't you care what Pelosi is doing?"
Previous media investigations found that between 2019 and 2021, at least 97 members of Congress were suspected of using insider information obtained during their work in Congress when selling stocks, bonds, or other financial assets. This includes former House Speaker Nancy Pelosi, a Democrat.
Although Pelosi herself claimed she does not trade stocks, her husband, Paul Pelosi, was accused of purchasing related stocks at opportune moments when Congress drafted or finalized bills affecting large technology stocks, thereby gaining significant profits. His investment returns even exceeded those of "Warren Buffett."
Or may trigger investigation
The Washington Post mentioned that this is not the first time Trump has called for people to buy stocks. In December 2018, during his first term, he publicly stated that the drop in US stocks was an opportunity for investors.
On January 17, just three days before Trump's inauguration, his "Trump Coin ($TRUMP)" instantly exploded the market, with its value surging by billions of dollars overnight. With the "Trump Coin" making a big splash, Melania Trump also launched the "Melania Coin ($MELANIA)."
When asked by reporters about "seemingly earning billions of dollars in the past few days," Trump pointed to the tech tycoons standing beside him and smiled, saying, "Billions of dollars are pocket change for these guys."
Last month, Commerce Secretary Lutnik also endorsed Tesla on a TV show, stating that Tesla stocks were "incredibly cheap," and advised viewers to "buy Tesla" if they learned anything from the show.
US Commerce Secretary Lutnik (right) US media screenshot
In the eyes of Richard Painter, George W. Bush's ethics lawyer, Trump's posts on the 9th were "a bad idea," and the current situation might lead to charges of market manipulation against him, which could trigger an investigation.
"I hope he can focus on doing his job—calming the markets, formulating predictable trade policies, and letting the market do its own thing, rather than giving seemingly investment advice from the White House." Painter said.
Jim Angel, a professor of finance at Georgetown University, told The Washington Post that usually, potential cases of market manipulation are first investigated by exchanges such as the New York Stock Exchange and Nasdaq. If investigators find evidence of abnormal trading, they will report it to the SEC, which then decides whether there is enough evidence to file a case for improper disclosure or trading. However, in this case, since no one knows who might benefit from Trump's posts, it is unclear who the SEC will sue.
Angel pointed out that as the main decision-maker of US tariff policies, Trump indeed held information considered "critical" to stock values by regulators when he posted that "now is a good time to buy."
However, he noted that Trump's statements were too vague, making it difficult for anyone to prove he violated disclosure regulations.
"Our securities laws prohibit any form of fraud or manipulation, but proving manipulation is usually difficult," Angel said, "I doubt regulators will pursue those who say now is a good time to buy."
But he added, "Starting today, many hedge funds' computers will monitor Truth Social and trade based on the President's tweets."
Kathryn Clark, a professor at Washington University School of Law specializing in government ethics and corruption issues, said that Trump's actions "generally trigger investigations by the SEC."
She stated that investigators will look for evidence that Trump provided clues to his followers knowing full well that his statement would affect the market.
"If we still have the rule of law and a strong legal system, we will investigate this." Clark said.
However, the SEC refused to answer questions about Trump's posts. A spokesperson for the US Department of Justice also declined to comment.
Original article: https://www.toutiao.com/article/7491606360602329641/
Disclaimer: This article solely represents the author's views. Please express your opinions by clicking the 'like/dislike' buttons below.