FIRST AIRED: December 6, 2018

Nice work! Enjoy the show!

×

You’re busy. We get it.

Stay on top of the news with our Editor’s Picks newsletter.

US Edition
Intl. Edition
Unsubscribe at any time. One click, it’s gone.

Thanks for signing up!

×

Transcript

00:00:00
>> China is gonna end up treating us fairly.>> Deal or no deal, depends on the day and the Tweet. A global stock market rally Monday following Trump's word that he and the Chinese agreed to a 90 day trade war truce reversed course on Tuesday. With a more than 3% drop for US stocks.
00:00:18
The spark, a Trump Tweet casting doubt a trade deal could be reached. And it's not Wall Street's first case of White House whiplash. And now some big investors telling Reuters they are skeptical of what they hear coming from 1600 Pennsylvania Avenue. Reuters hedge fund correspondent Lawrence Delevingne.>> JP Morgan's trading desk sent a note to clients saying, essentially, don't believe what Trump is Tweeting on the trade deal.
00:00:46
And that may not be surprising in itself, but, again, it's indicative of a broader wrestling that Wall Street has to do with what is put out by the administration. Which removes markets and how to trade based on something that may not actually prove true.>> And there's the dilemma, Presidents do move markets, but this one either quickly changes his message, or his staff, Treasury Secretary Steve Mnuchin.
00:01:11
>> He expects to move forward with a real agreement.>> Or, most often, Top Economic Adviser Larry Kudlow.>> There was some confusion, might have been my bad, I don't know.>> Has to clean up the policy muddle afterward. That only leads to more market confusion, leaving some on Wall Street searching for protection from resulting market swings.
00:01:33
>> So there are, essentially, two ways of dealing with the volatility from Trump and his administration. One is to just try and avoid it, to avoid, say Chinese linked tech stocks that might rise or fall with news of a trade deal or not. Another is to construct portfolio hedges so these are securities that can actually make money when there are big market swings.
00:01:55
>> In order to minimize losses for the remainder of Trump's term one hedge fund manager offers this advice about this White House. Quote, look at what they do and not what they say.