Trump’s "Kamala Crash" Backfires as Stocks Rebound
After using the market’s global sell-off as an opportunity to attack Vice President Kamala Harris, former President Donald Trump and his Republican allies were noticeably quieter Tuesday, as stocks gained back some of their losses. The S&P 500 closed just over 1% higher on Tuesday, while the Dow Jones Industrial Average was up nearly 300 points or 0.8% higher, breaking a three-day losing streak.
Key Takeaways:
- Trump and his allies blamed Monday’s market plunge on Harris, dubbing it the "Kamala Crash."
- Trump’s rhetoric shifted as stocks rebounded Tuesday, with no social media posts about the market.
- Trump’s reliance on market fluctuations for campaign messaging is seen as politically risky and reflects a misunderstanding of economic realities.
- Experts argue that Americans prioritize inflation, cost of living, and groceries over stock market performance.
Trump’s "Kamala Crash" Narrative Falters Amid Rebound
The stock market’s recovery on Tuesday effectively silenced Trump’s attempts to leverage the Monday sell-off for political gain. While he had aggressively blamed the downturn on Vice President Harris and the Biden administration’s policies, his Truth Social feed remained silent on the market’s rebound. This marked a stark contrast to his boisterous tweets on Monday, where he repeatedly linked the market slump to Harris and declared it the "Kamala Crash."
Trump’s immediate shift in messaging highlights his tendency to exploit market volatility for political gain. He has consistently attempted to attach his success to rising markets and blame his opponents for downturns.
In January, when the Dow and the S&P reached then-record highs, Trump boasted that it was a "TRUMP STOCK MARKET" because investors were betting on his ability to win the election. However, Moody’s Chief Economist Mark Zandi cautioned against such a strategy, stating: "I’m confused by it… Throughout history, I think politicians have avoided trying to peg their fortunes to the stock market as a signal of their policies or anything because the market goes up and down all around."
Beyond the Stock Market: Economic Realities and Voter Priorities
Zandi also pointed out that Trump’s fixation on the stock market ignores the true priorities of voters, who are more concerned with inflation and the cost of living. The recent jobs report, showing slower-than-expected job growth and a rise in the unemployment rate, has amplified those concerns.
While the U.S. economy has staged a post-pandemic recovery, the effects of inflation are still felt acutely by many Americans. Surveys consistently rank inflation and the cost of living as top voter concerns this election cycle.
Trump’s focus on the stock market as a proxy for economic health ignores this reality.
"For most Americans, what matters, certainly at this point in time, is inflation, prices, the price of groceries, rent," Zandi explained. "I think for most vast, vast majority of Americans, when they think about their own financial situation, stocks are at the bottom of the list, the very bottom."
The Politics of the Stock Market: A Risky Strategy
Trump’s tactic of tying his political fortunes to stock market fluctuations not only misrepresents voter priorities but is also politically risky.
The stock market is inherently unpredictable and prone to swings that can shift quickly. Attempting to capitalize on this volatility for political gain can backfire, as seen in the recent instance of Trump’s "Kamala Crash" narrative.
The market’s rebound on Tuesday highlighted the fragility of Trump’s strategy and raised questions about its effectiveness.
With the economy evolving, the next few months will reveal whether Americans will be swayed by these fleeting market moments or by the more enduring concerns around inflation and household costs.
