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- [00:00]
Andrew Egger
Hey, guys, it's Andrew Egger with the Bulwark. What else is new? We've got another day of bad economic news, slow GDP growth numbers coming out this morning, and Donald Trump has been reacting to these in kind of a flailing, amazing way. Here to talk about it with me a little bit, our own Will Salitan. How you doing, Will?
- [00:18]
Will Salitan
Great, Andrew. This is crazy. This up, down. Trump's got all sorts of crazy positions on it. It's wild.
- [00:24]
Andrew Egger
Yeah, he really is kind of an amazing guy. Right, let's just start with the tweet. Right? I mean, well, the headline news is basically the trade war has so scrambled markets that companies are dramatically importing goods in order to get out ahead of the tariffs that were going into effect. That's been happening all quarter. And the result of that, one of the results of that is that GDP growth was actually negative in the quarter that we just got data on this year. Obviously, markets have been having a really hard time lately in general off of the trade war, and they are continuing to sink today. Off the back of this news, let's just go right to the Trump tweet. This is Trump this morning at 9:13am ready to drop a truth bomb on us all at Truth Social. This is Biden's stock market, not Trump's. I didn't take over until January 20. Tariffs will soon start kicking in and companies are starting to move into the USA in record numbers. Our country will boom, but we have to get rid of the Biden overhang. This will take a while. Has all caps. Nothing to do with tariffs, only that he left us with bad numbers. But when the boom begins, it will be like no other. Be patient. So other than just kind of pure blame shifting and hopium, which is most of it, obviously, what do we have going on here? Well, what's Trump up to?
- [01:38]
Will Salitan
So, okay, so Trump is a. When it comes to tweeting and truthing and this stuff, Trump is a machine, right? He's got an algorithm. And the algorithm, algorithm is, was the news today good or bad? Was the stock market up or down? And therefore, will I take credit for it or will I cast the blame on Biden? Right. That's his, that's his sort of protocol. And the tricky part for him is that Trump doesn't really understand economics. Sorry. I mean, I know he's a businessman and everything, but, you know, a bad businessman. And so he doesn't really understand whether the bad indicator today means that things will continue to be bad or not. And so then he goes around Taking credit or blame or casting blame. And then he's often very surprised when the market shifts subsequently. And then he has to change his story to the other one, which is, oh no, it's Joe Biden's fault.
- [02:27]
Andrew Egger
Yeah, obviously, like every president does this to a certain extent, right? I mean, every, every president wants to get credit when economic indicators are good and they want people to focus on like ameliorating circumstances when, when things are bad. What I think is so special about how Trump does it is, it's just, it's so, there's, there's almost like a childlike simplicity to it, right? Like, like if, if, if markets were, were roaring in the first quarter and, and you know, the stock market had never turned around. We were, we were obliterating every Biden era peaks then I kind of think he'd have a little bit of a different feel, right, about, about when exactly the economic handoff had happened from Joe Biden to Donald Trump. Right. I mean, he's, and we can, we can roll back the clock a little bit first. Let's, let's just, let's just enjoy one more similar comment. This is Trump from, from just today, from his cabinet meeting that he had a little bit ago, reacting to the same news because basically making the same.
- [03:18]
Donald Trump
Point here for gdp. And this is, you know, you probably saw some numbers today. And I have to start off by saying that's Biden, that's not Trump. Because we came in on January. This are quarterly numbers. And we came in and I was very against everything that Biden was doing in terms of the economy destroying our country in so many ways. Not only at the border, the border was more obvious, but we took over his mess in so many different ways. Core gdp, removing distortions from imports, inventories and government spending was up plus 3%. When you add it. We had numbers that despite what we were handed, we turned them around and we were getting them really turned around.
- [04:04]
Andrew Egger
I mean, this poor guy, right? I mean, like, like what can you say? He wants the numbers to be green, the numbers are red. He's flailing around, right? I mean, what are we, what's, what's going on? Like, like, Yeah, I don't know. Talk to me. Well, what's going on in the brain of Donald Trump today?
- [04:19]
Will Salitan
Well, what's, what's notable? I mean, I think your distinction was useful there. Presidents always take credit and cast blame, but they usually do it over a longer period of time and with. One of the distinctions with Trump is the incredibly short, childlike attention span you know, he's, he, not only is he willing to, like, change his position from today to tomorrow, but he doesn't understand, like, it's like, you know, a child or an animal that doesn't have a theory of mind, doesn't understand what the audience understands. So he thinks that people will forget tomorrow what he said today. So he'll, you know, from he. He's got his story that changes month to month, and then even within the same day, he'll, you know, change depending on what the numbers say. So, like, the numbers that came out today, they're about economic data. There's already all kinds of disputes in, in econ world about what they indicate was the economy actually weak, are the numbers sort of faulty, and that they take into account some foreign data that are a little skewed by people buying in advance of the tariffs. And so because of the confusing story there, Trump just sort of takes his credit or blame, and then he's going to put himself in a really difficult position. You know what I think, Andrew, is that as the tariffs roll in, I mean, as like, for example, the Chinese goods that are coming over, right, they've stopped coming over. And so the real effect of the tariffs will be felt later. So actually, Trump is going to take more of a hit later to the extent that he says that that was the Biden economy and now this is the Trump economy. Because the Trump economy, when the tariffs actually hit us, is going to be bad.
- [05:53]
Andrew Egger
Yeah, yeah, yeah. I wonder how long the Biden economy will last. Right? I mean, will it be, you know, the winter of 2027 and we're like, just getting out from under the Biden economy in the word of Donald Trump. I want to dwell a little bit more on just this, the kind of Pavlovian way in which this has all come down. Because if you just look at the. The stock market over the last five years, basically, or maybe three or four years, you can really set your clock to it. Just looking at the graph, at times when it is going up during Joe Biden, Trump is tweeting about how that's probably, you know, actually to his credit, rather than the current president, Joe Biden, when it's going down under Joe Biden, that's when you know we're under the Biden economy. So if you look back, you know, in Joe Biden's first term. Let me just walk through this real quick, because I think it's amazing. 2021, late 2021, and especially to kind of late 2022 was really the doldrums for Joe Biden, it was like late 2022, people were going in the midterms, People were getting a little antsy, talking about the possibility of a retraction or a contraction or a recession, even a potential recession. And, and right then you get a blizzard of posts from Donald Trump all over Truth Social. This is the Biden economy. He's. He's crashing us. He's putting us in the crapper, right? Over and over and over again. But that writes itself. You know, it turns out to be we kind of get the soft landing for the, for the post Covid economy that, that, that people were hoping we would get. And the stock market reverses. And it's basically throughout all of 2023 and 2024, it's dramatically on the upswing. And obviously Donald Trump changes his tune. Right? By mid 2023, he is already sharing articles suggesting that the reason why the economy is going so well is because we're getting toward the end of Biden's term. Investors are looking forward. They're excited for Donald Trump to get back in there. You know, so then again, January of last year, he posts this on Truth Social. This is the Trump stock market. Because my polls against Biden are so good that investors are projecting that I will win and that will drive the market up. Everything else is terrible. He goes on from there. The only thing keeping this hot economy rolling is that we're 11 months out from, or I guess 10 months out from another Trump victory. Fast forward a little bit. Even from that, you get to the summer. Biden does poorly. Kamala Harris gets into the race. The economy hits a very small rough patch for about a week, and Trump goes ballistic again. He's calling it the Kamala crash. He's saying, and now it's back from being Donald Trump's economy. Now it's Kamala Harris's economy as vice president that vanishes much more quickly than Donald Trump would have liked. And then we get into Trump being reelected and the stocks rise again, and then it's all economic good news again. Right? I mean, investors then are really excited that Trump's happy to take the credit in, you know, last November, December, January. So it's just, I mean, it's just this unbelievable, like, over and over and over again. Anytime the arrow is green, super happy, super Trump's fault. Anytime the arrow is red, it's literally anybody else. How do people keep falling for this? Do people keep falling for this?
- [08:46]
Will Salitan
Okay, so first of all, the answer to that is people did fall for it. They fell for it in 2020 when Trump said the whole Covid year was like, doesn't count. He's like, I ran the economy for three years and then the China virus came in and then when we fought the China virus and then everything is fine after. So he took basically a mulligan on that whole year and voters actually bought it. Right. If you look at polling from the 2024 election, they said Trump was a great president and they just blanked out all of 2020 because Trump disclaimed responsibility for it. So it did work. But Andrew, let me show you one more clip from the timeline that you were doing, which is really great. But we got to August of last year and we get through one of those patches. The stock market's doing great, except there's a little bit of a couple of days that don't work. So Trump gets up at this rally in North Carolina and he gives the story about how the stock market is going up only because of me, except he's got to explain the couple of days when it was bad. Right. And so he calls up to the stage Scott Besant, who's going to become the Treasury Secretary. And for people who don't know this Scott Besant, the number one thing he did to endear himself to Donald Trump and earn the job of Treasury Secretary was to claim on stage on I don't know how many occasions that the stock market was going up under Joe Biden because of Donald Trump. Right. So let's just play this clip and I'll go come back to it.
- [10:17]
Donald Trump
Many people say that the only reason the stock market is up is, is because people think I am going to win. Did you ever hear that? But there was one day a couple of weeks ago when they weren't thinking that and you saw what happened. This will be a 1929 style crash. You know, I have one of the most brilliant men in Wall Street. I think here I shook hands with him just a little while ago. Scott, Where's Scott? Where is Scott? Oh, stand up this man. Will you come up here please? Just come up here for a moment. He is considered one of the most brilliant men on Wall street and he's made certain statements. I'd like him to make them because probably I'd be better off if he made them than me. Right? But I do agree with him. But no, he's considered one of the greatest on all of Wall street, respected by everybody. And I'm not sure he can get through Secret Service. It's gotten very tight. Come on up, Scott. Come on up. Come on up, Scott. Come on up here. Look at him. And he's a nice looking guy, too. Want to say a couple of words? Come on.
- [11:33]
Will Salitan
Look, this is the Trump economy. This is the Trump stock market. And I can tell you that it will be. Kamala Harris will start with the Kamala crash in the stock market and then it will be the coma crash in the economy. So what I love about this clip is not just that Trump calls up like a ventriloquist, he gets bessen to do his dirty work for him on this crazy, you know, red, green stuff, but that in the middle of that, Trump says, you know, there were a couple of days when the market was bad. And that's only because for those couple of days, the polls were bad and people thought I was gonna lose. So that was, that was on Joe Biden. It just shows him like doing this flip flop within the same week, within the same speech.
- [12:15]
Andrew Egger
Right, right. He can do it fractally. That's amazing. I mean, I would like to see like the Robin Hood day trader version of Donald Trump on all of this where he's like watching the little micro fluctuations in the market over the course of a day and trying to peg them to ever slighter, ever smaller Joe Biden actions. It's too bad that we couldn't get that over the last presidency. I want to dwell on one other thing here from this tweet today, which is the, the methinks the lady does protest too much style claim here. This will take a while. Has nothing to do with tariffs, only that he left us with bad numbers. I mean, that is really, that's really something because, because everyone knows that this has everything to do with tariffs. No, no single person who has paid a bit of attention to the stock market over the last, you know, several months since Liberation Day and even before could possibly have missed that. The, the single glaring giant macroeconomic driver of all of this stuff is tariffs. Donald Trump makes trade, trade announcements and the markets get yanked around. He puts more tariffs on and they crash. He suggests they might take some off, that it might not be as bad, and they come firing back up again. Some random guy's post will go viral suggesting that, that the tariffs might be coming off and that will spike the market until it is discovered that that's fake and the market re crashes. I mean, it's so amazing that he would just get out there with a safe, with a, with a straight face and try to make the case that it's some kind of lagging macroeconomic indicator from Biden, that is, that's yanking markets like shaking markets like a rag doll today. I mean, like, can I, can I.
- [14:00]
Will Salitan
Press you on that? Let me press you on that for a minute though, because, you know, you. And I sit here and say, oh, no rational at this can fail to see that. Like, of course it's the tariffs that are messing with everything. And like, Andrew, I totally believed in no rational person, therefore this will happen up until like the 2024 election. And then I'm like, I don't know if rationality actually works, man. So, like, there's a different view of, of Trump and the, and the economy, which is that there are a lot of people in this country who are like invested in Trump. They believe in Trump and they believe, you know, like, let's take religion because Trumpism is a kind of religion, right? And in primitive religion and versions of Christianity and other faiths, you have anything good was done by God and anything bad was done by the devil. So there are a lot of people out there who think that Donald Trump is kind of God, right? That anything, if anything good happens, it must be because of him. And that's the story he tells. And I don't know, do you think people are going to be rational and say, yeah, it's the tariffs causing the bad stuff and the tariffs came from Trump, or are they going to buy into his story because he's good at telling these stories.
- [15:04]
Andrew Egger
I think that you are right that there are a lot of people who are invested in Donald Trump in this way, but there are also a lot of people who are invested in the economy, right? I mean, like, like this is a lot of people have 401ks, a lot of people have, you know, have actual stock holdings and things like that. And even among the much larger portion of people who do not, you know, hold stocks or whatever, who are not actually like losing money actively on these tanking markets, everyone is exposed to the kind of like chaos that he is starting to put into the economy. And I think that, that it is possible to over index on learning your lesson from 2024, that people are going to set aside the rational stuff for the gut thing. Because, because the gut. This is not just a case of, of sort of rational indicators pointing against Trump and him being able to deploy gut indicators. Economic pain is a gut indicator, right? I mean, and that, that was part of what made things so hard for Joe Biden last time around is that the most broadly felt economic indicator was inflation, right? I mean, everybody everywhere was Going to the grocery store and getting mad all the time. And you could make the case correctly, rationally that, that, that voters should put that in context of the post Covid economic recovery and, and you know, rapid growth and wages rising and the fact that real wages were actually up, you know, people were making more money to be able to pay the higher prices and all of those things. But, but ultimately, like the animal gut feeling was just hard for people to get away from that. Prices were high. And the animal gut feelings that people are going to be feeling, you know, a couple of months from now if things, if, if he stays the course with this trade war are going to be really bad. They're not. I mean, and yes, like, he's always going to maintain that core. People will fall away more slowly in relation, like in, in proportion to how deeply ingrained he is in their identity. He's never going to, you know, lose his, his ultra maga core people. But, but I just think it's factually unlikely that Donald Trump can drive the economy personally off a cliff and not pay a substantial political price for it, it seems to me.
- [17:06]
Will Salitan
Yeah, well, what's fascinating to me is that Donald Trump seems intent on testing this proposition. Like, take the prices. Right? That's the most basic thing I think people feel every day. You literally, you are at the store, you look at the price of eggs or milk or whatever it is, you can see whether it's gone up or down. Donald Trump is out there. He was out yesterday at this rally in Michigan saying grocery prices are down. He's been saying that for a week. Andrew. I don't know if that's true. I find it hard to believe I'm not experiencing it. Grocery prices do not seem to be coming down for me. But I got a feeling that he's going to test the proposition whether he can not just spin economic indicators or the stock market, but literally the prices that people are paying. Joe Biden couldn't get away with it. People knew that grocery prices were going up and there was no way of lying his way around it. But I think Donald Trump is going to try to do that. And I'm kind of fascinated to see how many people will fall for that.
- [17:58]
Andrew Egger
I totally agree, as just kind of like a neutral observer, that it will be really fascinating to stress test that proposition. And I think we're going to really get to stress test it because holy cow, things are looking grim out there economically. The one other thing that I wanted to say on all this stuff, when it comes to just how investors are paying attention to this. I think the biggest thing, if I'm like a bank, who's looking at this statement today, obviously I'm gonna roll my eyes at a lot of the stuff that Trump is rolling his eyes out here. But I'm also going to be really just taken aback by yet another indicator that there is really no plan. I mean, the thing that they have been saying all along is they've been trying to project this sort of strong chinned approach that like, yeah, markets are sagging, people are freaking out a little bit, they're panicking, we're not worried about it. It's all going to be fine. They're going to realize it's fine. They're going to be hunky dory the backside. We're all going to forget this stuff ever happened. So just chill out, markets, we're all going to be doing okay. That's kind of the line that the White House has been rolling out. And meanwhile, at the same time, they continue to put out increasingly stressed out signals that they're freaking out inside the White House about all of this stuff. Right? I mean, like yesterday there was that story, I read about this in morning shots this morning. The story of the fact that Amazon was supposedly going to start putting kind of like tariff prices, like priced out in the goods that they're selling online. It was not something Amazon had announced, it was just something that Punchbowl News had reported and the White House lost its shit. You know, Carolyn Levitt got up like minutes later and said that it was a hostile political act by Amazon and started smearing them, you know, with, with years old stories about being like connected to Chinese propaganda. And Donald Trump dropped everything and got Jeff Bezos on the phone to get them to walk this thing back. I mean, they're, they're, they're really freaked out about the fact that prices are going to go up and the fact that people might connect that to them. And then you see a tweet like, like this one today where, where Trump is just against all reason and against the evidence of everybody's eyes saying that the dip in markets has nothing to do with tariffs. Well, obviously he must care a lot about the dip in markets in even the short term if he's gonna tell such obvious lies like that, right? I mean, like, am I crazy here? Like, like, how can you be like JP Morgan and look at this and think the White House has any kind of a plan, right?
- [20:29]
Will Salitan
Well, they are, they're, they're testing it in all the ways you just Described what they're testing in part is can they hide information? Let me, let me. Because the Amazon thing is super interesting. Can they hide bad economic indicators and can they invent good ones? They're literally doing this. Okay, so one of them is the Amazon thing. Amazon was going to give you information about the extent to which the tariffs were raising the prices. And it's obvious because the price was this. Then the tariffs came in and now here's. We have, we have to pay our suppliers more. Here's the increase due to that. So White House goes ballistic. Don't give consumers that information. Right. They're trying to hide an economic fact from people. The other one was, remember when the stock market started to dive because of the tariffs? I think it was April 2nd third, the Fox News removed the ticker. Remember that? They take the ticker off the screen because that's information that might scare people. Oh, we don't want to panic the markets, but really we don't want them to see what Trump just did. So they hide that information. Meanwhile, and this is my bet over the long term, Andrew, the White House is inventing or they haven't invented, but they're going to invent the idea that it's a specific number, a, an index to compensate for all the damage that you're seeing to your 401k, all of the increase in prices that you're seeing because of the tariffs raising the cost of imports. And the indicator that this number is going to be the asserted investment in the United States due to the tariffs. Right. We have and we see Trump doing this. He did it is rally. Does it. Trillions of dollars, like billions of dollars. You know, I just talked to this Thai businessman, this Malaysian businessman. He's bringing his factory over here. It's gazillions and gazillions. And you know, we all remember this from Lordstown and like, promises of money that's going to be invested, like, and it often just doesn't happen. But the White House is going to be giving people daily this tally of supposed investment that's going to be coming in over the next couple of years that's supposed to make people feel good and think things are okay, even when all the actual tangible economic indicators suck.
- [22:33]
Andrew Egger
Yeah, I think you're absolutely right. That's going to be the strategy. And I think you're absolutely right. They're going to push it farther than anyone's tried to push it before, just in terms of like, just running straight out over the cliff and just continuing to turn their legs and see how long they can do the Wile E. Coyote thing. But I also think that eventually, you know, that gag ends the same way every time, right? I mean, gravity aggressively reasserts itself. And while you may be correct that. That these sorts of things will be enough to kind of sustain the hope and confidence of, say, like, that. That core 33%, that. That's like the. The real ride or die MAGA base. Trump needs a lot more people than that to survive. Right? And if you're. And if you're, like, holding up pictures of money on the screen, it's like. It's like. It's like, you know, showing a guy a movie of. Of like a banquet hall of food when he's starving to death. Right? I mean, like, at a certain point, like, the hunger itself can't be sated by those kinds of, like, fake outs. You know what I mean? Like, look, maybe I'm insane. Maybe I'm completely wrong.
- [23:42]
Will Salitan
No, you're sane. You're. Andrew, you're being totally sane. We're questioning whether sanity prevails. But you make a really good point here. You know, in the stock market over the long term, every time there's been a point when people say the old rules don't apply anymore, gravity is being defied. It doesn't. Right. The gravity always does assert itself. That's in the market. Right. The market eventually being a rational instrument. I would like to believe, and I'm sure we all would, that that is also true in politics and that even though we've been through a crazy period where people don't seem to be behaving rationally and reality doesn't seem to be driving things, eventually it will. Eventually it will set in, and if it does, Donald Trump is cooked.
- [24:20]
Andrew Egger
Yeah. And look, we're 20 minutes into here, and we have. Have really at no point interrogated. Interrogated. Sorry, let me say that again. And look, we're like 20 minutes in here, and at no point yet have we really interrogated one of the premises here, which is that he could blink. He could stop the trade war, you know, like, that would not fix everything. There would be all kinds of new snarls in all of these. In all of these supply lines and the loss of global confidence and America as a safe haven and all those things. We'd still have to sort all that out, but at least we would have stopped certain amounts of the bleeding, probably. I mean, certainly you would see markets shoot out of a bottle again, straight up. Who knows if they'd be as high as they were before. But that would be another thing for Trump to hang his hat on. That would forestall a certain amount of the coming economic pain. And look, I kind of hope he does that. Right. I would prefer never to test. I mean, you say it's kind of like, like intellectually stimulating and interesting to be able to interrogate the question of, man, how bad can things get before the snake oil salesman, just the bottom falls out of that whole routine. And like, yeah, that will be really interesting to test. But I also really hope that, that he does just kind of spuriously declare victory and we never actually have to see it. He lets, he lets, he lets the, the, the, the invisible hand of the market go back to doing its thing, creating prosperity for lots of people and things like that. But he's given no indications so far that's the plan. So I guess we'll see.
- [25:45]
Will Salitan
Well, you know, that's an even more difficult question. There's not believing in the rationality of voters, which is difficult enough to have faith in that. But the idea, will Donald Trump be responsive to reality? Right. Because all the time he isn't. Right. The 2020 election, all the people around him say, you actually lost. The fraud does not account for the differences for you losing these states. And he just refused to believe it. And that was, seemed to be true about the tariffs. Got this faith in the tariffs. The markets dive. Trump's like, don't worry about it. It'll all go away. And then it doesn't go away. And so for that week, April 2nd to 9th, we had kind of a test of is Donald Trump ultimately susceptible to the reality of the markets? And on April 9, the answer was yes.
- [26:28]
Andrew Egger
Right.
- [26:29]
Will Salitan
He's, he did, he did the first blink. And that was encouraging to me because I don't want to have a madman running the most powerful country in the world. But he hasn't given up the underlying faith, this sort of bizarre Peter Navarro faith that, you know, tariffs are this, this, this filter where we just, like, take in all this money and like, it doesn't have an economic cost to the larger global economy or to prices. So he's got the underlying faith. But he did, he did blink once. And Andrew, I'm hoping that he will continue to blink, because as much as I would like Donald Trump to suffer the consequences of his bad policies, I, I don't want Americans in the world to suffer the consequences of his bad policies. So if he blinks, we all come out ahead.
- [27:11]
Andrew Egger
Yeah, for now, we are all locked in with him. And I guess we're gonna see how that goes, man. We went kinda long. Thanks, Will. We can stop it there. Sorry. To our producers. Thanks to any of you guys who stuck around for this whole time. This stuff's so crazy, man. I don't know what's gonna happen. I guess we'll figure it out. We'll figure it out. Tweet by tweet, bleep by bleed as we go. I should say thanks for watching. Hope you subscribe to the feed. Go over to thebullwork.com to read our stuff. Share it with your friends, share with your family, share it with your enemies. Anybody who you think might benefit from a little bit of our content. Thanks, and we'll see you all next time.