Economy Trump buys more than $100 million in U.S. bonds

[HOLA]

State, municipal and corporate bonds. Among the corporate bonds:

Citigroup
Morgan Stanley
Wells Fargo
Meta
Qualcomm
T-Mobile
The Home Depot
United Health

State and municipal bonds are a hodgepodge of stuff. Highways in West Virginia, schools in Ohio, Illinois state bonds, etc.

This comes as Trump has been heavily pressuring the Fed to lower interest rates (when interest rates fall, bond prices rise), threatening to fire the Fed chairman and others if they don't comply. He has also fired the head of the BLS for releasing numbers he doesn't like. The figures released by the BLS are used by the Fed to make their monetary policy decisions.

All sounds rather questionable to me. But The White House says it's OK:

"Trump and his family have no involvement in directing or influencing what to buy or sell, which are decisions made by a third-party investment manager, according to a White House source familiar with the report. The Office of Government Ethics certified that the report in compliance with legal requirements, the source said."

Trump buys more than $100 million in bonds in office, disclosure shows

Trump's financial disclosure shows corporate bond buys from Citigroup, Morgan Stanley, Wells Fargo, Meta, Qualcomm, T-Mobile USA and The Home Depot.

www.usatoday.com

 

[wlu.29]

This is just his version of sampling fruit from the supermarket

The heavy money was in the meme coins

 

[Crazy Source]

Why does everything this dickhole does seem shady af?

 

[F1980]

I don't get it

 

[HARRISON_3]

They made Jimmy Carter sell his peanut farm.

 

[Crazy Source]

I don't get it

Pretty simple. Trump just bought $100M in bonds. Trump has been pressuring the FED to lower interest rates. If those rates drop, those bonds become more valuable. I mean, even the hint of impropriety should be avoided by the President. This is blatant.

 

[HOLA]

I don't get it

Think of interest rates like gravity. The higher they get, the more gravitational pull they have on asset prices.

Trump's favorite economic indicator has always been how the stock market is doing, despite the fact that the stock market and a country's economic health, over the short-term, are not always highly correlated.

With this in mind, Trump has been demanding that interest rates get lowered for years. He's been complaining about it since 2018, when the Fed first started raising rates.

The Fed has a dual mandate. They are supposed to encourage maximum employment and price stability - they have a long-term goal for inflation to be around 2%, which is considered healthy.

The Fed supports this mandate through monetary policy - its ability to influence interest rates.

If the economy is weak, they can lower rates to stimulate the economy. It becomes cheaper to take out loans, which increases spending, investments, etc. But you have to be careful not to cause inflation.

If the economy is strong and they're worried about inflation, they can raise rates, which makes borrowing more expensive, which slows down spending and investments.

After The Great Recession in 2008, the Fed kept rates near 0 for 10 years. But the economy had strengthened and we also eventually began to have concerns about rising inflation. So rates were raised.

JPOW achieved a "soft landing," which is both rare and impressive, and shows his expertise in monetary policy. He brought down inflation and didn't cause a recession.

They may have actually lowered rates earlier, but Trump's tariffs threw a wrench into everything, and they wanted to wait to see how everything played out (and if Trump would ever stop being a TACO) before deciding what to do.

Trump, who has bankrupted multiple casinos, does not give a flying fuck about any of the nuances. He just wants the Fed to lower rates, and he's firing and threatening people to achieve it. Now, with this new financial disclosure, it shows how much he personally stands to benefit from rates being lowered, even if it might not be right for the country.

There's currently about an 80% chance The Fed finally does lower rates this September, according to the CME Fed Watch Tool. If they don't Donald will have a massive temper tantrum.

 

[Crazy Source]

I should have added that Powell's term expires in May. Trump will put in someone that will do his bidding. That 80% chance is closer to a 100% chance, @HOLA .

 

[Unknown Pleasures]

Pretty simple. Trump just bought $100M in bonds. Trump has been pressuring the FED to lower interest rates. If those rates drop, those bonds become more valuable. I mean, even the hint of impropriety should be avoided by the President. This is blatant.

Of course it is inappropriate, but hey, nobody is going to care. People have sacrificed their patience to their tech overlords, and sacrificed their ethics to post-modernist "thought". Going to take a lot more shit hitting the fan than that for the pendulum to swing the other way.

 

[Mr Holmes]

Well here's to hoping a recession ruins Flumph's plans.

 

[Crazy Source]

Well here's to hoping a recession ruins Flumph's plans.

That would cause the FED to lower rates, which would make the bonds more valuable.

 

[Mr Holmes]

That would cause the FED to lower rates, which would make the bonds more valuable.

Yeah, you're probably right. I don't think those companies will go bankrupt.

 

[Unknown Pleasures]

That would cause the FED to lower rates, which would make the bonds more valuable.

Yeah, but they are corporate bonds he bought, not government bonds. So their value would also be depending on credit spreads / credit risk, and in a recession the credit risk shoots up and the bonds could lose value more than offsetting benefit from rate cuts. Though chances of default would probably still be pretty low if they are high credit quality companies.

 

[Revolver]

Trump even knows he’s going to tank the market.

 

[Yoricks Wisdom]

Missed opportunity

Should've invested in Tardcoin

 

[DoctorTaco]

Missed opportunity

Should've invested in Tardcoin

The one post in this thread I actually understand

 

[ShadowRun]

Didn't break no laws cool..... but TACO Epstein

 

[Natural Order]

Why does everything this dickhole does seem shady af?

1986 just called, wants it's question back...

 

[Devil's_Advocate]

I don't get it

Interest rates and bond prices have an inverse relationship, so that when the Fed lowers interest rates(as is planned), the bond prices will go up(anything in excess of what he paid for them will be profit).

Prior issued bonds(with X maturity date) have higher coupons (interest payments) than the future new lower payment issued bonds so that's why they will be worth more. Bonds are essentially contracts to pay %(like CDs) every quarter and eventually you'll get your principal(money you lend the issuer) back. So Trump is essentially counting on interest rate cuts being a formality. Tresurys(federal) tend to be safest but also have very low %, then typically state and municipal...very strong corporate bonds likewise enjoy low % due to them being very trusted/safe (Apple, Google, etc). This is where the bond grading comes in with investment grade vs high yield risky 'junk' bonds. The more risky the bonds (lower grades C, etc) the higher the interest rate to compensate the borrower for default risk. Looks like the ones listed are all high investment grade (AA, etc). I didn't check them individually but that's my assumption from a quick look.

Many investors may likewise pour their money into more volatile securities like equities(e.g. small cap stocks). However because Trump is old (79) his investments likely reflect his short term investment window whereas a younger person (e.g. 30 year old) would probably go with equities or crypto.

Probably more info than you wanted and I hope it makes sense.

 

[44nutman]

As I have said in other threads you can make money in the stock market with Trump as President if you just pay attention. Biden you could do nothing and make money. Trump you have to do way more trading but money can be made.
This is a great sign for my 2nd round of #TrumpPuts. Been selling other winners and now heavy into #TrumpPuts.
The only risk is if Trump’s balloon ankles burst, market would still tank but would recover quicker with someone a little more competent.