Donald Trump has been accused of possible market manipulation following a social media posting urging investors to purchase stocks. This was followed by a sudden reversal in trade tariffs that sent markets soaring around the world.
On Wednesday morning, shortly after the US markets opened, Trump posted on his social media platform Truth Social that “THIS IS THE BEST TIME TO BUY!!! DJT.”
He stunned investors within four hours by announcing that new tariffs would be suspended for 90 days on most countries, except China.
The announcement triggered an explosive rally. The S&P 500 closed up over 9%, and the tech-heavy Nasdaq surged over 12%.
Global ripple effect was rapid.
In early Thursday trading, Nikkei 225 in Japan jumped 9% while the FTSE 100 in London climbed up to 4%.
Trump’s unusual decision to sign his post with “DJT”, the same ticker for Trump Media & Technology Group which owns Truth Social, added intrigue.
The company’s shares rose 22% Wednesday, which raises further questions about the timing of the message from the president.
Washington intensifies calls for investigations
The sequence of events prompted harsh criticism from lawmakers. They alleged that Trump’s actions created an opportunity for insider trade.
Senator Adam Schiff said that the market swings require scrutiny.
Who in the administration was aware of Trump’s latest tariff flip flop before it happened? “Did anyone profit from the public’s loss by buying or selling stocks?”
Senator Chris Murphy also expressed his concerns, warning that there was an “insider-trading scandal” and speculating on the possibility that Trump’s tweet was a signal for his associates to profit from private information.
Alexandria Ocasio Cortez, a representative of the House of Representatives, called on all members to reveal any recent stock trading, which could indicate suspicious activity.
“I’ve heard some interesting chatter on floor,” she wrote in X.
The deadline for disclosure is May 15th. We’re about learn a few new things.
Experts in ethics and law see reason for investigation
Legal scholars and ethical experts argue that Trump’s conduct deserves serious investigation.
Richard Painter, former Chief Ethics Lawyer for President George W. Bush warned that Trump’s timing makes him vulnerable to accusations of manipulation of the market.
Kathleen Clark, professor at Washington University School of Law said Trump’s behavior “would normally trigger an investigation by Securities and Exchange Commission.”
She said, “Such Investigators would be looking at evidence that Mr. Trump was aware he would make an announcement that would affect the market and then gave a clue to his supporters,” she added in a NYT article.
When asked by the NYT about Trump’s post, the SEC, which is responsible for ensuring compliance with federal securities laws declined to comment.
This isn’t the first time Trump’s financial dealings have been questioned.
Before he began his second term, he received criticism for the launch of his meme coin $TRUMP.
A New York Times analysis revealed that a crypto wallet made $109 million according to reports at the time.
White House defends President’s motives
White House officials denied allegations of misconduct and insisted that Trump’s post on social media was meant to calm the markets amid widespread uncertainties.
Kush Desai is a White House spokesperson. He said, “It’s the president’s responsibility to reassure markets and Americans that their economic security is secure in the face nonstop media fear mongering.”
Desai accused Democrats “of grasping at straws in order to play partisan politics” and urged that they work with the administration to improve the US economy.
Washington is increasingly demanding transparency and accountability, even though the White House has downplayed the controversy.
The decision of regulators to pursue this matter could have far reaching implications for Trump’s presidency as well as the financial markets.
This post Trump’s “great time to buy” post sparks claims of market manipulation: calls for investigation may grow as updates unfold
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