Wall Street experienced significant volatility for over a week due to President Trump’s statements regarding tariffs. Recently, allegations have surfaced suggesting he may have deliberately tried to manipulate the market using his position.
The controversy began with two of Trump’s social media posts. On Wednesday, shortly after the U.S. stock market opened, Trump posted on his Truth Social network, advising in all caps, “THIS IS A GREAT TIME TO BUY!!!” Within roughly four hours, he announced on the same platform that he would pause the most severe of his tariffs on various countries. This led to stocks sharply rising, with the Dow closing nearly 3,000 points higher. Consequently, those who took Trump’s investment advice that morning potentially benefitted significantly by the market’s close.
Prior to his posts, stock prices had been in decline for several days as concerns grew over the potential economic damage from Trump’s trade policies. Prominent investors and business figures increasingly voiced their concerns about the new tariffs and the subsequent financial unrest.
By Wednesday afternoon, Trump seemed to acknowledge these concerns by pausing the tariffs. In response, some Democratic lawmakers and ethics experts are advocating for investigations to determine if Trump was attempting market manipulation or facilitating insider trading.
Senators Adam Schiff and Ruben Gallego, both Democrats, sent a letter to the White House requesting an inquiry into whether Trump or his associates engaged in insider trading informed by advanced knowledge of his tariff policy changes. Senator Elizabeth Warren also called for an investigation, questioning in Congress whether this was “corruption in plain sight.”
White House spokesperson Kush Desai dismissed the accusations, labeling them as partisan attacks. Desai stated that Trump’s post was intended to reassure investors about their financial security.
Richard Painter, a law professor and former ethics lawyer for President George W. Bush, criticized the statements, arguing that public officials, including the president, should not make comments about stock trading while making impactful economic decisions. He noted that similar actions would likely have resulted in dismissal during the Bush administration, but he did not directly accuse Trump of market manipulation.
Trump’s actions have raised ongoing concerns about financial conflicts of interest since his election in 2016. His engagement with the cryptocurrency sector and appointments of pro-crypto officials have drawn continuous scrutiny.
Despite calls for investigations, ethics experts anticipate limited actions from Republican-controlled Congress or the SEC. The Senate recently confirmed Trump nominee Paul Atkins to lead the SEC, and Trump has previously signed an executive order increasing his influence over independent regulatory agencies, including the SEC.
An SEC spokesperson declined to comment on this issue.