Since Donald Trump became President of the United States, he has frequently used Twitter to vent with his tweets often having a significant impact on the global markets.
Trump has discussed many conspiracy theories on the medial social platform, and while his tweets are often trivial, there have been periods of tension when his words seemed to threaten global peace and intercontinental relations. The financial markets are always affected when something like this takes place, so let’s take a more in-depth look at Trump’s Twitter activity.
Climate Change is a Hoax
In 2012, President Trump floated a theory that the climate change phenomenon was a hoax, a costly one perpetuated by the Chinese government.
The concept of global warming was created by and for the Chinese in order to make U.S. manufacturing non-competitive.
— Donald J. Trump (@realDonaldTrump) November 6, 2012
While these words would later go on to cause strained relations with the Chinese government, the immediate aftereffect of the tweet was felt across the world. The US withdrew from the Paris Climate Accord in 2017. The Obama Administration’s goals of a 26% to 28% emissions cut below the 2005 levels had been a low target to start with, given that the US is the second most significant greenhouse gas emitter in the world. However, now, the US is aiming at cutting emissions by just 15% to 19% before 2025.
Business leaders in America are confused about what their stance should be regarding environmental concerns. Officially, all other nations have decided to stick to the Paris deal.
Experts believe that in the wake of the ongoing trade tariff wars with the US, other countries could impose carbon-based tariffs on imports (border carbon adjustments or BCAs) in retaliation. For now, countries like France, Canada, and Mexico appear keen on it.
Trump’s War with China
In August 2018, President Trump tweeted:
Report just out: “China hacked Hillary Clinton’s private Email Server.” Are they sure it wasn’t Russia (just kidding!)? What are the odds that the FBI and DOJ are right on top of this? Actually, a very big story. Much classified information!
— Donald J. Trump (@realDonaldTrump) August 29, 2018
Although the FBI refuted these claims, the damage was done. On September 25, 2018, Trump made statements at the UN Security Council meeting that China has been meddling with US election affairs. On September 26, 2018, he tweeted:
“China is actually placing propaganda ads in the Des Moines Register and other papers, made to look like news. That’s because we are beating them on Trade, opening markets, and the farmers will make a fortune when this is over!”
While President Trump claims that the ensuing bad relations with China have no impact on the American economy, experts have suggested otherwise. Retaliatory tariffs of over $60 billion on imports by China on US goods are a threat to American companies that employ over 11 million workers. This is going to affect the people in rural and low-population counties of the nation significantly, where a single meat-packing business can provide a livelihood for numerous people in the area.
The biggest hit has been taken by soybean farmers, who have been given a $4.7 billion bailout by the US government.
The beliefs and statements of an influential person like the US President have far-reaching effects on the global economy. Traders should always keep an eye out for such statements, even if they seem trivial. The reality is that almost anything can impact the financial markets.