Stock market drop shows peril of following a cult leader, Trump

Here in the United States the big news since last Wednesday afternoon, when President Trump unveiled his so-called "reciprocal" tariffs on most countries, has been the precipitous weekly drop in the stock market, almost all of which occurred on the two trading days after Trump's announcement (which occurred after the stock market had closed on Wednesday).

The Dow has lost 7.2%, the NASDAQ 7.8%, the S&P 500 7.8%. Stock market futures are down 2.5% to 3.9% at the moment, presaging another steep decline tomorrow, Monday.

I've lived through big stock market drops before. Two fairly recent ones come to mind. In 2001 there was a crash after the 9/11 attacks. In 2008 there was a crash after risky speculation in the housing market. But this crash is different.

It is being caused not by any crisis to hit the United States, but by the failings of a single person: Donald Trump. He loves to talk about how "tariffs" is his favorite word. Problem is, Trump either doesn't have the faintest idea how tariffs work, or chooses to ignore what he knows about them. 

Either way, at the moment Trump is singlehandedly causing a global financial crisis by imposing massive "reciprocal" tariffs that actually have nothing to do with the level of tariffs imposed by other countries on United States imports. I wrote a blog post about this, "Not a surprise: Trump's tariffs are based on lies."

There's a lesson here.

It is exceedingly dangerous for either a nation or an individual to put their faith in a cult leader, whether the cult is religious or political. Things never end well when this happens. One reason is that cult leaders -- which naturally includes Trump, because few members of his Republican Party challenge his authority or even disagree with him -- have a vastly inflated sense of their own competence.

I haven't come across a single reputable economist who endorses how Trump is conducting his tariffs crusade. Economists agree that while tariffs may be justified if carefully tailored to achieve certain specific ends, what Trump is doing is economic malpractice.

One noted American economist, Lawrence Summers, has said that Trump's tariff policies are the economic equivalent of creationism: a crackpot idea that has no evidence backing it up.

It's pathetic to hear members of the Trump administration try to justify Trump's tariffs, which include placing a 46% "reciprocal" tariff on imports from Vietnam even though Vietnam has only a 9% tariff on United States imports. Almost always those members of the Cult of Trump spout blather like, "Trump is a great businessman who knows more about tariffs than anyone in the history of the world, so we all should trust he knows what he's doing and that things will work out fine."

There are many problems with Trump. On clear display now is his inability to even listen to expert advice, much less follow that advice. Trump has surrounded himself with True MAGA Believers who refuse to criticize or correct their Dear Leader. As is the case with so many of Trump's policies, he wrongly considers that his personal intuition is a better guide than solid evidence and expert knowledge.

Well, we're going to see how that works out. I predict, very poorly. Trump is adept at fooling people, but he isn't able to fool reality -- which includes how the stock market performs in response to the Trump tariffs. Investors have their own political views, and many voted for Trump. But they primarily are interested in making money.

Currently stock market investors are saying to Trump, your tariffs are bad for the United States and they're bad for the world; what you've done has markedly increased the chance for a recession, and we're pricing that dismal prospect into what we're willing to pay for stocks.

If somebody isn't interested in facts, evidence, and the expertise of others, don't trust them in the realm of either politics or religion. Authoritarians and cult leaders don't want people to think for themselves. They want blind faith, not open-eyed knowledge.

I'm pleased that I recognized Trump's failings early on and never considered voting for him. Unfortunately, enough people ignored Trump's weaknesses to put him back in the White House. Now this country and the world is paying the price for Americans failing to say No to a cult leader in the 2024 election.

Comments

[Ron E.]

This was in ‘The Independent’ recently and describes leaders as not being so much authoritarian as patrimonial: - “Using a term coined by German sociologist Max Weber, Hanson described Trump as a “patrimonial” leader, who exercises power based on personal loyalty. “Patrimonial leaders, including not only Trump but also politicians like Vladimir Putin in Russia, Viktor Orban in Hungary, and Benjamin Netanyahu in Israel, treat the state as their own personal property and run it like a ‘family business’ of sorts,”

Patrimonial leaders rule as they see fit, he said. “For this reason, they see independent sources of expertise and professionalism as a threat, and aim to undermine them as forcefully as possible.” The president has questioned journalists, judges, and prosecutors. Hanson said in an email.

Trump tends to personally attack those who disagree with him because “it increases this loyalty from his supporters, who feel he is not only right, but being persecuted for being right,”

“One should not underestimate President Trump’s genuine emotional connection to his followers, many of whom see him as a leader chosen by God to save the nation,” Hanson said. “And even Musk has followers who see him as a uniquely brilliant entrepreneur, able to break old bureaucracies that were previously thought of as untouchable.”

All sounds very much like a cult particularly for those who see him as a leader chosen by God to save the nation.

***

Incidentally, I’ve just read something on the British ‘corn laws’ from around 1827. ‘The ‘corn laws’ enabled the government to impose high import duties on foreign grains. Cheap corn from the USA was so heavily taxed that it became prohibitively expensive allowing the British wealthy to eliminate competition and monopolise prices. As a result, the wealthy got richer while the poor suffered.’ When rising prices hit the American consumers guess who will suffer most?

[Karim W. Rahmaan]

I think there are bad people in the world.

And on the other side of the coin, there are good people.

So all church leaders can't be all bad. Take Maharaj Ji Charan Singh for instance. What evidence do we have that here was a bad person?

He loved the camera, loved taking his own pictures in fact and he was never camera shy. Even if he was a camera shy type of person would that instantly make him a bad person? I don't think so.

The RSSB Masters have always taught us to learn to think for ourselves. The great Sardar Bahudar Jagat Singh said that Clear Thinking was 90% abhyas (spiritual practice). And Baba Gurinder Singh teaches exactly what his predecessors taught him.

But if we don't use this clear thinking, this 'mindfulness' per say. Then how could we know the good from the bad?

[umami]

A dull knife is more dangerous than a sharp one.

[Appreciative Reader]

A dull, vicious, psychopathic, venal knife.

Trump's destroying everything. But what's ...inexplicable, is the complete lack of spine of the spineless, witless creatures that enable him and cheer him on. Suddenly the bleeding hearts stop bleeding, and bleating, when babies and women die, and genocide and displacement continue unchecked. Even when such outright imbecility as this tariff madness is unleashed, these creatures find no voice to criticize.

Who are these creatures? Groveling at the feet of their vile god, licking his boots even as he laughs at them and kicks them and makes money off of them? How came these creatures to be, these creatures lacking discernment, lacking wit, lacking dignity, lacking integrity, lacking spine? These creatures that are viler and more unclean even than their vile master, because the orange psychopath's vileness is at least straightforwardly self-serving. But these slaveys, these creatures of his? Who are these filth?

Like I've said before, it's almost like Saruman fashioned these orcs out of mud and dirt, expressly designed them to be base, creatures that would enable Sauron to birth evil.

Yep. Cult, indeed. Sums it up completely.

[Jimmy]

Trump /Elon are Gods/Jesus/Buddha using their god powers(imagination), implanted(crucified) in the skull(Golgotha) of every human- Neville Goddard.
You're not some helpless human like the world would have you believe. Imagination is the golden ticket out of this world to the infinite universes every day or night. It's the golden ticket out of any situation you find yourself in now.

[sant64]

This is the real patriotism. Ignore the massive government waste that's been uncovered, ignore China's upside down dominance on trade and how it affects US security, ignore the catastrophic national debt and the dire national need for fiscal reform. Ignore that we just had an election and the guy who was elected is doing exactly what he said he would do. Ignore the fact that the working class in the US has been decimated by jobs that are now in foreign countries.

It's the real progressive patriotism. Just worry about yourself, giggle that you bought wifey a new Japanese car, give a silent blessing to all the cowardly terrorism of your "take it to the streets" minions on fellow Americans' cars. And of course, call everyone who disagrees with you a cult member. So powerless, so bitter.

I'm a child of the 60s. I remember the main reason why actual cults were feared -- little mindless minions would commit acts of violence to get their way.

So great patriot, silently celebrate your showroom firebombings, celebrate when stones are thrown from overpasses and kill pregnant women. Keep crying about the lost election. Keep crying because the super overextended stock market went down a few points. The few, the bold, the proud -- the old white progressives.

[yesivotedfortrumpandicandisagreeonpoints]

Sant64 just can’t quit his love affair with all things Trump—he fawns like a groupie at a farewell tour, conveniently forgetting that the very deficit the Orange Oracle now rails against peaked during his own first term in office.

Even Ben Shapiro and the libertarian chorus (cue Rand Paul with his eternal furrowed brow) agree that the tariff tax is about as useful as a screen door on a submarine.

Yes, believe it or not, you can still wear the MAGA hat and admit when the Emperor’s trade policy has no clothes.

Trump's been dreaming about this tariff crusade since the '80s—probably while watching “Wall Street” and thinking Gordon Gekko was the hero. Now, decades later, with his “mandate” in hand, he’s finally rolling it out… backwards. Because guess who ends up footing the bill for all this economic whiplash?

Spoiler alert: it’s not China. It’s us.

[101]

While Charan Singh was living he told a group of Westerners that one day America would be poorer than India.

This was relayed to me decades later by a few of those who heard his words and I found it impossible to believe.

However, I’m just now beginning to see how that could be a future possibility. The economic situation in America is a perfect storm of various factors converging at the same time to dethrone the US dollar.

Oh well, we had a good run. Nothing lasts forever.