Just when it seemed that Donald Trump, the Republican candidate for re-election in November, had abandoned the battering rams of inflation and the border to attack the Democrats, brandishing instead identity issues – the blackness of Kamala Harris – the collapse of the stock markets has brought him back to the economic terrain. In several messages published this Monday on Truth Social, the former president attacks the Democratic candidate with his usual torrent of capital letters, to attribute exclusively to her the day of panic due to the supposed rejection of the markets to his candidacy. The tycoon has baptized the day as “the Kamala crash”, a label that immediately became a trending topic on the social network X (formerly Twitter), owned by one of his best propagandists, Elon Musk, with 209,000 posts.
“Kamala is even worse than Crooked Joe [Biden]. The markets will NEVER accept the Radical Left Lunatic who DESTROYED San Francisco and California as a whole. Next up is THE GREAT DEPRESSION OF 2024! MARKETS are not to be trifled with. KAMALA’S COLLAPSE!” reads one message, threatening “World War III if these morons remain in office.” The spectre of a global conflagration is not new: it was one of the lines of his acceptance speech for the Republican nomination at the party convention in Milwaukee, riddled with lies and exaggerations.
In apocalyptic terms, which do not correspond to the factors that have caused the stock market collapse, the Republican candidate warns of the threat of a “great depression in 2024,” although the main indicators, such as the gradual control of inflation (in June it was 3%, close to the 2% target) do not corroborate his theory. From blaming the Democrats for the increase in prices, Trump has gone on to sell his recipe for prosperity (“voters have a choice: Trump’s prosperity or Kamala’s crash”) in search of the support of independents or undecided voters, which both parties are fighting for.
Many strategists had criticized Trump’s decision to question Harris’ racial identity, aware that the attacks could backfire not among his conservative base, but among independents and younger voters. “Ultimately, the heart of this election is economic issues. Any time you don’t talk about that, you miss an opportunity to appeal to independent voters,” Republican Party pollster David Winston told reporters. The Wall Street Journal“And independents always decide who wins the elections.”
But with the economic data in hand, Trump misses the mark. Despite the volatility of the stock markets, the collapse seems to have been driven by complex international operations, not by a loss of confidence in the US economy due to the latest employment data, according to the Axios Macro portal. “There is no reason for a 0.2 percentage point increase in the US unemployment rate to be a cause for concern.” [del 4,1% de junio al 4,3% de julio] trigger a 12% plunge in the Nikkei’s share price, the selloff [venta] which triggered a day of chaos around the world.” Another factor to attribute the black day to is the fall of the largest technological stocks due to their excessive spending on AI, the portal confirms.
Trump’s far-fetched economic arguments for attacking his rivals find their clearest expression in his promise to lower interest rates if elected, as he promised last Wednesday while the Federal Reserve kept the price of money unchanged. Even if he won the election, the Republican would not be able to cut rates, which are set by the Fed, which is autonomous and competent in any monetary policy decision independently of the White House and, therefore, theoretically free of political pressure. Its president, Jerome Powell, has reiterated that politics will not play a role in the decisions of the monetary policy committee, but Trump’s interference – it is hard to believe that he said this out of ignorance of the functioning of the central bank – worries many.
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Trump announced this impossible drop in the price of money at the annual convention of the National Association of Black Journalists in Chicago, the same forum where he recently accused Kamala Harris of being black, after saying that inflation and high interest rates are “destroying our country” and that, if he were elected, he would “lower them a lot.”
“I’m going to bring inflation way down, so that people can buy bacon again, so that people can buy a ham sandwich again, so that people can afford to go to a restaurant,” he promised. Although it is an entity independent of political power, a hypothetical second term for the Republican has raised fears of an intervention that would go against the Fed’s mandate. However, the fear that the Federal Reserve will lower rates too late – in 2022 it was accused of reacting too late to inflation; today, of delaying in lowering the price of money, at its highest level for 23 years – has never worried Republicans, but quite the opposite: some of them have asked the central bank to refrain from relaxing its policy before the November elections, so as not to to benefit to the Democrats.
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