Globe and Mail via Archive.ph
The funniest thing keeps happening in the financial markets.
Just before Donald Trump drops some bombshell news, a bunch of mysteriously well-timed bets are placed, paying off obscene amounts of money once the announcement lands.
Suspicious trades have become a fixture of Mr. Trump’s major policy moves, whether they pertain to tariffs, the capture of former Venezuelan president Nicolás Maduro or the war in Iran.
It’s almost like someone knows exactly what Mr. Trump is going to say, and when.
And now we have new details of Mr. Trump’s own investments. His accounts have executed thousands of stock trades this year alone, plenty of them coinciding with market-moving news initiated by Mr. Trump himself.
It’s obvious Mr. Trump is leveraging the presidency for immense financial gain. His first year back in office was the most profitable of his life, bestowing US$3-billion in wealth on the family fortune, according to Forbes.
Mr. Trump’s self-enrichment campaign comes at a cost to us all. It rips off those on the other side of those trades. And it undermines the fairness of the public markets.
This is bad for anyone with a vested interest in U.S. stocks, which includes pretty much every Canadian. Our major public pension plans alone hold at least $300-billion worth of American equities. There are workplace pensions on top of that. Mutual funds. And the ranks of everyday investors who have piled into U.S. index funds.
The cost is not strictly an abstract one. A little more than a year ago, Mr. Trump stood in the Rose Garden and happily pummelled the world with absurd tariffs. In the stock market freakout that followed, defined benefit pension plans in Canada saw their $18.4-billion surplus virtually wiped out in just two days, according to Aon’s pension risk tracker. Their funded ratio dropped to its lowest since June, 2023.
A few days after that, some anonymous traders started betting heavily on U.S. stocks. For one fund that tracks the S&P 500 index, the number of contracts leapt to more than 10,000 a minute, up from the hundreds, according to a BBC report.
Just 18 minutes later, Mr. Trump announced a 90-day pause on tariffs. Whoever seemed to anticipate the news that day made out very well, as did the U.S. President himself, whose stake in Trump Media rose by at least US$400-million in a matter of hours.
In the aftermath, several Democratic senators asked the Securities and Exchange Commission to investigate whether Mr. Trump’s tariff announcements “enriched administration insiders and friends at the expense of the American public.”
The SEC seems committed to leaving every stone unturned.
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