Trump just told you to buy stocks now that we are in a bear market — should you listen?
President Donald Trump — aka the day trader in chief — has a pretty good feel for the markets.
One can make the argument a better feel than the Federal Reserve he continues to blast from the confines of the Oval Office via Twitter.
"We have companies, the greatest in the world, and they're doing really well. They have record kinds of numbers. So I think it's a tremendous opportunity to buy. Really a great opportunity to buy," Trump reportedly said to reporters at the White House on Christmas.
Trump’s “bullish” comments come on the heels of the worst Christmas Eve trading session in history. The Dow Jones Industrial plunged 653 points Monday as investors continued to dump tech stocks such as Apple on fears of a global growth slowdown and Trump continued to blast Federal Reserve officials for raising interest rates. Investors return to trading the day after Christmas with the S&P 500 and Nasdaq Composite in bear markets. The Dow is on the brink of entering one.
The million dollar question today is should you follow Trump’s advice to get into a beaten up stock market? We definitely don’t provide investing advice here at Yahoo Finance. But judging by historical tweets from Trump on the market that one could deem actionable (different than just tweeting about the markets), perhaps now isn’t a bad time to nibble. Trump’s track record on predicting the market is somewhat successful from a short-term trading perspective, nothing more.
So if active investing is your thing, Trump the broker may not be such a bad lead.
August 21, 2015
With markets in a free-fall amid Chinese stock market turbulence, Trump suggested investors should be “careful.” At the time, the Dow (his favorite measure) closed at 16,459 according to Yahoo Finance data. The Dow hit a bottom of 15,666 on Aug. 25, so Trump saved some a few more points to the downside.
The Dow then went onto close the year at 17,425.
Dow dives more than 500 points - down 9% from high. Be careful!
— Donald J. Trump (@realDonaldTrump) August 21, 2015
November 17, 2017
Trump strikes a bullish tone on stocks. The Dow closes at 23,557. It then goes on its January melt-up on optimism around the Trump tax cuts.
The Dow reaches a peak of 26,616 on Jan. 26.
Great numbers on Stocks and the Economy. If we get Tax Cuts and Reform, we'll really see some great results!
— Donald J. Trump (@realDonaldTrump) November 17, 2017
December 19, 2017
Trump comes out upbeat on stocks again. The Dow closes the day at 24,754. It reaches a peak on Jan. 26 of 26,616.
Stocks and the economy have a long way to go after the Tax Cut Bill is totally understood and appreciated in scope and size. Immediate expensing will have a big impact. Biggest Tax Cuts and Reform EVER passed. Enjoy, and create many beautiful JOBS!
— Donald J. Trump (@realDonaldTrump) December 19, 2017
January 3, 2018
Trump the trader is getting a bit greedy at this point. He strikes a bullish note once more, with the Dow closing at 24,922. But then things turn south rather quickly.
After peaking on Jan. 26 at 26,616, the Dow crashes and hits a bottom of 23,860 on Feb. 8 on valuation and Fed rate hike fears.
The Dow currently stands at 21,792 despite Trump starting 2018 waxing poetic on the potential for further gains.
Stock Market had another good day but, now that the Tax Cut Bill has passed, we have tremendous upward potential. Dow just short of 25,000, a number that few thought would be possible this soon into my administration. Also, unemployment went down to 4.1%. Only getting better!
— Donald J. Trump (@realDonaldTrump) January 4, 2018
Brian Sozzi is an editor-at-large at Yahoo Finance. Follow him on Twitter
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