- The White House faces allegations it may have enabled unlawful gains on the stock market in connection with Donald Trump’s tariff brinkmanship. “Americans need to know whether President Trump or anyone in his administration manipulated the market to benefit their donors,” said Sen. Elizabeth Warren.
Leading Democrats in Congress are alleging allies of President Donald Trump may be illegally profiting from his tariff brinkmanship.
Trump’s on-again, off-again trade war has sent global asset prices on a wild ride. On Wednesday, the Dow Jones industrial average gained 3,000 points for the first time ever in a single session while “Magnificent Seven” stock Tesla soared 22%, after the White House called pause on its so-called reciprocal tariffs.
Thanks to the volatility, anyone with advance knowledge of the administration’s plans could make a killing on the market. Now, Democrats are questioning whether their Republican peers did just that.
“Any member of Congress who purchased stocks in the last 48 hours should probably disclose that now. I’ve been hearing some interesting chatter on the floor,” wrote New York Rep. Alexandria Ocasio-Cortez. “It’s time to ban insider trading in Congress.”
Her comments were in response to indications that word of Trump’s pivot may have leaked just prior to the announcement.
Shortly before the announcement, there was a flurry of call options buying in the derivatives market for exchange-traded funds passively tracking equity indexes like the SPDR S&P 500 and Invesco QQQ that moves in tandem with the Nasdaq 100.
Hours before Trump reverses course, he urges investors to buy assets
On Wednesday, the White House posted a video in which the president turns to Charles Schwab, the 87-year-old founder of the eponymous brokerage firm, saying how he had just made $2.5 billion that day.
“That’s not bad,” Trump remarked. He did not say whether Schwab made any trades on that day, and his company did not respond to a request from Fortune for comment.
Earlier in the day, however, Trump put out a post on Truth Social recommending, “THIS IS A GREAT TIME TO BUY.” CNBC then quizzed the U.S. secretary of commerce on the president’s uncanny ability to time the market. “I always bet on Donald Trump,” Howard Lutnick replied.
Trump also ended the post with his initials, DJT. Typically, this is a way for politicians to signal that they wrote the post themselves rather than their staff, but a hallmark of the president is that he writes his own statements on social media, so signing off is not necessary.
His DJT initials also happen to be the ticker for Truth Social’s parent company, Trump Media & Technology Group, which likewise soared over 20% on the day.
Asked about that detail, the commerce secretary claimed Trump uses his initials to name himself as the sender in all of the text messages Lutnick receives from his boss.
Sen. Warren calls for an investigation
Because President Trump has determined Washington’s moves in the recent trade brinkmanship, investors have had little choice but to hang on Trump’s every pronouncement.
Even an apparently harmless misunderstanding over comments by economic advisor Kevin Hassett sent markets on a roller-coaster ride on Monday.
This unpredictability presents problems, however, as those in his orbit could enjoy an advantage and may be tempted to speculate thanks to the information gleaned through their proximity to the Oval Office.
Case in point, when asked which U.S. companies his administration might exempt from tariffs—a move that could have enormous implications for the stock prices of companies like Apple—Trump answered these decisions would be taken “instinctively.”
Just hours before Trump changed course, he proclaimed now was a great time to buy assets, a statement crypto scam sleuth Stephen Findeisen argued offered the “perfect plausible deniability” needed for insider trading.
It remains unclear whether, at the time he posted that on Truth Social, he was already planning a U-turn on tariffs. The White House did not respond to Fortune’s request for comment.
“Was that market manipulation? Was it corruption in plain sight?” Sen. Elizabeth Warren said on the floor of Congress, calling for an official investigation. “Americans need to know whether President Trump or anyone in his administration manipulated the market to benefit their donors.”
