My wife spotted a note in Facebook that Trump’s tariff manipulations were making his billionaire friends much wealthier. The person posting suggested that billionaires had the money to invest when the market goes down and then sell when it goes up. I think there are several more pieces to what is going on. First, raising tariffs predictably lowers market prices by making business more expensive. Second, although I have never personally done it, it is possible to do what is called “selling short” although it is now hedged with legal rules. The basic idea is a promise, for current market prices, to provide stock in the future. If the market goes down, you can buy the stocks you promised to provide later at a lower price. That can lead to a big profit. To do this well, you’d need notice of Trump’s tariff changes at the earliest possible moment so that you’re ahead of the market. Third, you’ll have the best chance to make the most profit if you get notified before the tariffs are changed and by how much.
If you believe that Mr. Trump is above market manipulation, then some people are betting that they are just rich enough to take the chance they can predict what’s going to happen. But there are numerous examples where people with power to manipulate the market used it for their own benefit or for friends or relatives who could return the favor in other ways. That’s illegal, of course, but saying things are illegal isn’t the same as saying they don’t happen. Trump has resisted other financial rules. He resisted the Constitution’s emoluments clauses which forbid taking “any present, emolument, office, or title, of any kind whatever, from any king, prince, or foreign state.” Art. I, sec. 9, par. 8., or taking any “emolument from the United States, or any of them,” Art. II, sec. 1, par. 7. And he refused to supply his tax information though it was finally uncovered by others. And he refused to put his investments in a blind trust as other presidents have been doing.
I have no personal information so I’ll leave it to you whether you do or don’t trust him to use or supply inside information. Either way, Trump, his family, his friends or his supporters are likely to benefit. In any of those ways, government action by Trump would enrich himself, other millionaires and billionaires by raising prices, increasing inflation and disadvantaging people of more ordinary incomes that thought he would be their savior.
To repeat what I told you a couple of weeks ago: “the jobs he says he’ll bring back went to China because people there were willing to work for a pittance,” so Trump is offering American workers jobs which will pay them a pittance. At the same time he “is trying to take back thousands of dollars every year from your Social Security, your health care, your overtime, your minimum wage, the good jobs that Biden, yes Biden, had put in the pipeline,” and all of that would benefit Trump’s billionaire family, friends and supporters. Unless you are already a billionaire, this guy is NOT on your side. He may try to offer you something but it will be a fraction of what he is taking away. Beware.
Steve Gottlieb’s latest book is Unfit for Democracy: The Roberts Court and The Breakdown of American Politics. He is the Jay and Ruth Caplan Distinguished Professor Emeritus at Albany Law School, served on the New York Civil Liberties Union board, on the New York Advisory Committee to the U.S. Civil Rights Commission, and as a US Peace Corps Volunteer in Iran.
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