I expected markets to plunge even MORE says Trump amid another Wall Street sell-off as he says he is right to fight China because it has ‘taken us to the cleaners for 25 years’
- The president spoke about the trade war as the Dow experienced another steep drop
- He set off a market swoon by announcing new tariffs and tweeting about China this week
- Said the sell-off ‘is to be expected’
- Trump said China has been ‘taking us to the cleaners for 25 years’
Trump said the drop across financial markets was ‘expected’ and said he might have expected ‘more’ selling. The drop began when the president reignited the trade war with China when he announced a new 10 per cent tariff on $300 billion worth of Chinese goods, then blasted China in a series of tweets as the Treasury labeled it a currency manipulator.
China also took steps that devalued its currency in response, causing another market shock.
‘I think the market reaction is to be expected,’ Trump said Wednesday as he left the White House.
‘I think the market reaction is to be expected,’ President Donald Trump said Wednesday, speaking about the China trade war
‘I might have expected even more. At some point … we have to take on China. They’ve been taking – look, they’ve been taking us to the cleaners for 25 years,’ Trump vented.
Trump went down the list of his grievances with China, which has rapidly industrialized and become the world’s No. 2 economic power.
The Dow dropped more than 300 points Wednesday morning
The market turmoil comes amid an ongoing trade clash between the U.S. and China, with no future talks expected until September
The president claimed ‘thousands and thousands of companies are leaving China’ under tariffs imposed by his administration
Trump said the U.S. had been taken ‘to the cleaners’ by China. Chinese President Xi Jinping, center, sits during a meeting with Bangladesh’s Prime Minister Sheikh Hasina at the Diaoyutai State Guesthouse in Beijing, Friday, July 5, 2019
‘Hundreds of billions a year taken out of our country. Stealing intellectual property. And you know what? We right now are sitting on top, we have money pouring in and have powerful, strong companies. China is losing – they’re losing thousands and thousands of companies are leaving China now because of the tariffs,’ Trump said. And we’re in a very good position as to whether or not a deal will be made, I will tell you this, China would like to make a deal very badly,’ he said.
The Dow dropped more than 300 points Wednesday morning, with both the Dow and the broader S&P index down more than 4 per cent for the month.
Investors were pouring money into gold and other assets presumed to offer safe harbor amid the turmoil.
At the same time, bond yields dropped as investors sought alternatives to stocks. Yields drop when prices rise.
Earlier in the week, Beijing let the yuan breach that 7-per-dollar level for the first time in 11 years, shortly after President Trump threatened to impose more tariffs on Monday.
China also announced it was stopping purchases of U.S. agriculture products. Trump said at a summit meeting in Japan that China had agreed to make additional purchases.
Trump responded with a series of angry tweets, fueling market anxiety.
It led to the biggest sell-off on Wall Street this year, with the Dow and S&P 500 dropping nearly three percent each while the Nasdaq Composite plummeted 3.5 percent on Monday.
However, markets reversed course Tuesday after China took steps to bolster its currency, the yuan.
Last week, the Federal Reserve, after repeated public pressure by Trump, lowered a key interest rate by 0.25 basis points.