Dollar Crashes After Trump Says "Dollar Is Getting Too Strong"

Tyler Durden's picture

It was bound to happen sooner or later: having flipflopped on virtually everything else, moments ago, in an interview with the WSJ, Trump also backtracked on his strong-dollar policy and in an interview with the WSJ, has said that the "US dollar is getting too strong", that the "strong dollar will ultimately hurt the US', and as a result, he preferes a low interest rate policy.

The headlines from Dow Jones:

  • TRUMP SAYS IN WSJ INTERVIEW STRONG DOLLAR 'WILL HURT ULTIMATELY' THE U.S., MAKES IT VERY HARD TO COMPETE
  • PRESIDENT TRUMP: U.S. DOLLAR 'IS GETTING TOO STRONG'
  • TRUMP SAYS HE PREFERS LOW INTEREST RATE POLICY
  • TRUMP SAYS WON’T LABEL CHINA CURRENCY MANIPULATOR: WSJ

And the details from the WSJ:

President Donald Trump said Wednesday the U.S. dollar “is getting too strong” and he would prefer the Federal Reserve keep interest rates low. Mr. Trump, in an interview with The Wall Street Journal, also said his administration won’t label China a currency manipulator in a report due this week.

 

He left open the possibility of renominating Federal Reserve Chairwoman Janet Yellen once her tenure is up next year, a shift from his position during the campaign that he would “most likely” not appoint her to another term.

 

“I do like a low-interest rate policy, I must be honest with you,” Mr. Trump said at the White House, when asked about Ms. Yellen. “I think our dollar is getting too strong, and partially that’s my fault because people have confidence in me. But that’s hurting—that will hurt ultimately,” he added. “Look, there’s some very good things about a strong dollar, but usually speaking the best thing about it is that it sounds good.”

 

He continued, “It’s very, very hard to compete when you have a strong dollar and other countries are devaluing their currency.”

 

Mr. Trump said the reason he has changed his mind on one of his signature campaign promises is that China hasn’t been manipulating its currency for months and because taking the step now  could jeopardize his talks with Beijing on confronting the threat of North Korea.

 

“They’re not currency manipulators,” Mr. Trump said.

Well, they are, they are just manipulating it in the opposite direction at this very moment.

Ms. Yellen was a frequent target of Mr. Trump’s during the campaign, when he criticized her for keeping interest rates low. Asked if Ms. Yellen was “toast” when her term ends in 2018, Mr. Trump said, “No, not toast.” 

 

“I like her, I respect her,” Mr. Trump said, noting that the two have sat and talked in the Oval Office. “It’s very early.”

So where did this complete policy U-turn and "novel" weak dollar idea come from? Take one guess: "Treasury Secretary Steven Mnuchin, who sat in on part of the interview,
said the president was “very close” to nominating a vice chairman to the
Federal Reserve Board and another to the seat set aside for a community
banker.

“We think that is very important,” Mr. Mnuchin said about the
community banker seat."

The result was instant: the dollar just crashed.

* * *

In other words, instead of calling China a currency manipulator, Trump was manipulate the dollar instead. And just like that Trump is now in war with the tightening Fed.

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NugginFuts's picture

#NotCurrencyManipulation

#POBCamateurs

My stack thanks you, Mr. President. 

Chuck Norris's picture

Dammit, Don!  Stop the jawboning already.  I need to pick up more gold with my "strong" dollars before this whole thing goes to the shitter.

auricle's picture

If trump can keep gold prices rising will that be the leverage he needs to keep his anti war base at bay?

Stuck on Zero's picture

Government policy has always been to accelerate into a crash. Nothing has changed.

BaBaBouy's picture

You Know What They Say... JABS JABS JABS
Wow Buy GOLD...

NugginFuts's picture

Don't worry - there'll be a member of the Fed along any minute now to talk PMs back into holiday shopping territory. Because Passover, duh.

Franklin Mint Chip's picture
Franklin Mint Chip (not verified) NugginFuts Apr 12, 2017 3:51 PM

Weak dollar ==> Buy Bitcoin! That is your new "trade"! Go forth and make it so!

https://localbitcoins.com

NugginFuts's picture

hell no. I'd sooner put my money in a blender, thank you kindly. 

FrozenGoodz's picture

Keep flappin your gums cheese puff

Manthong's picture

He speaketh and the sea doth part.

Franklin Mint Chip's picture
Franklin Mint Chip (not verified) NugginFuts Apr 12, 2017 4:01 PM

Seriously what is your major malfunction??

NugginFuts's picture

A) Is it shiny?

B) Can I hold it in my hand?

C) Does it have intrinsic value?

D) Is it easy to exchange in an off grid crisis?

 

If the answer is no, I don't want it. But you're welcome to put as much of your own money in it as you want. We'll see which is worth more in 50 years.

Franklin Mint Chip's picture
Franklin Mint Chip (not verified) NugginFuts Apr 12, 2017 4:10 PM

I'm guessing that in 50 years 1 Bitcoin will buy many, many tubes of Gold Eagles.

Observationist's picture

He doesnt understand what Bitcoin represent...

NugginFuts's picture

Clearly. But I'm ok with that. Go ahead and hold your digits on a thumb drive. I'll keep my shiny stuff. 

wren's picture

Agreed. Bitcoin is simply regulated online gaming currency. Not a fan. I'll trust tangibles, any tangible, before I trust a virtual.

Gold, guns, gunpowder, bows, arrows, orange juice, cows, milk, shoes, hats, they all serve a purpose beyond being used to purchase. Bitcoin, it only exists to trade. It serves no other purpose but to use as currency. That to me, makes it the same as the US Dollar. If it is only a limited number supply and has no other function, I'm not a fan in the long run.

Franklin Mint Chip's picture
Franklin Mint Chip (not verified) wren Apr 12, 2017 4:07 PM

"regulated"?? By who?

Max Hunter's picture

I think our dollar is getting too strong, and partially that’s my fault because people have confidence in me. "

So.. he doesn't have a single advisor that could tell him about the petrodollar and how the USD would be worth about as much as the Peso if not for the US armed forces maintaining the illusion of USD strength?

Anyway.. timing couldn't be more suspicious.. I'd look for an event in the markets somehow.. in someway.. 

wren's picture

Wasn't referencing the government, was referencing that its a system devised by programmers and regulated by those programmers. They are the ones who place value on it by limiting supply.

Hey, if you like being virtually rich, more power to you. I'll stick with the real deal. I like my money how I like my women, and virtual women, though there are advantages, I'll stick with the real thing.

wren's picture

Additionally, at least you can make paper airplanes and wipe your butt with a dollar. You can't even do that with bitcoin.

bob_bichen's picture
bob_bichen (not verified) Franklin Mint Chip Apr 12, 2017 4:46 PM

Frnklin Mint Chimp  <<< CHRONIC "bullshit.bitcoin.com"  SPAMMER

Franklin Mint Chip's picture
Franklin Mint Chip (not verified) bob_bichen Apr 12, 2017 4:50 PM

bob_bichen <<< Retard hall monitor who doesn't understand the difference between "spam" and "URL links"

bob_bichen's picture
bob_bichen (not verified) Franklin Mint Chip Apr 12, 2017 5:16 PM

Vote up!
       2


Vote down!
         -147

Franklin Mint Chip          Apr 12, 2017 3:51 PM

Weak mind ==> Buy Bitcoin! That is your new "trap"! Go forth and step right in it!

https://bullshit.bitcoins.com

 

Franklin Minto Chimp  <<< CHRONIC SPAMMER

JackT's picture

A "Thank You" to China for their continued support on the hot potato known as North Korea?

Stuck on Zero's picture

Government policy has always been to accelerate into a crash. Nothing has changed.

CheapBastard's picture

Let the dollar fall and stop manipulating gold. Allow gold to rise to its true value of $3,600/oz.

2_legs_bahhhhhd's picture

3,600$ for a 1/4 once coin sounds about right.

CheapBastard's picture

lol....true that....I was being too conservative.....

Consuelo's picture

 

 

You forgot the X10 part ---- but it's coo...   All in due time.

SHEEPFUKKER's picture

Our blips on a screen with zero percent interest rates backed by nothing are too strong. 

buckstopshere's picture

Northern Dynasty Minerals (NAK) up more than 30% today. :)

knukles's picture

So now we're getting our selves into a currency war?  (s/ LOL, etc.)

youarelost's picture

Been in it for 20 years

IridiumRebel's picture

King Dollar! When the petrodollar shits the bed, let's call the new one the "Donner".

This is it's picture

Well,  because he is a manipulator too. 

youarelost's picture

Trump likes cheap shit just like the rest.

Silver Savior's picture

Don't have to worry about the dollar being strong at the grocery store. They want more and more of them for the same or less product. I hate using dollars as currency. Devalue the crap to nothing!

TomGa's picture

DONALD J. TRUMP CONTRACT WITH THE AMERICAN VOTER

What follows is my 100-day action plan to Make America Great Again. It is a contract between myself and the American voter – and begins with restoring honesty, accountability and change to Washington

Therefore, on the first day of my term of office, my administration will immediately pursue the following six measures to clean up the corruption and special interest collusion in Washington, DC:

* FIRST, propose a Constitutional Amendment to impose term limits on all members of Congress;

* SECOND, a hiring freeze on all federal employees to reduce federal workforce through attrition (exempting military, public safety, and public health);

* THIRD, a requirement that for every new federal regulation, two existing regulations must be eliminated;

* FOURTH, a 5 year-ban on White House and Congressional officials becoming lobbyists after they leave government service;

* FIFTH, a lifetime ban on White House officials lobbying on behalf of a foreign government;

* SIXTH, a complete ban on foreign lobbyists raising money for American elections.

 

On the same day, I will begin taking the following 7 actions to protect American workers:

* FIRST, I will announce my intention to renegotiate NAFTA or withdraw from the deal under Article 2205

* SECOND, I will announce our withdrawal from the Trans-Pacific Partnership

* THIRD, I will direct my Secretary of the Treasury to label China a currency manipulator

* FOURTH, I will direct the Secretary of Commerce and U.S. Trade Representative to identify all foreign trading abuses that unfairly impact American workers and direct them to use every tool under American and international law to end those abuses immediately

* FIFTH, I will lift the restrictions on the production of $50 trillion dollars’ worth of job-producing American energy reserves, including shale, oil, natural gas and clean coal.

* SIXTH, lift the Obama-Clinton roadblocks and allow vital energy infrastructure projects, like the Keystone Pipeline, to move forward

* SEVENTH, cancel billions in payments to U.N. climate change programs and use the money to fix America’s water and environmental infrastructure

IridiumRebel's picture

EIGHTH: Lie about all of the above and go full on John McCain and start wars fucking everywhere!

Bernie Madolf's picture

Strong $ is helpful to 99% of Americans. Only the large multinational corps want a weak dollar so trump is showing his true colors.

Another big fu to his base. The neocons and libcons are driving this bus Thelma and Louise style

Apple10's picture

Weaker dollar, more exports, more jobs, no more trade deficit, better economy.  

Jack&#039;s Raging Bile Duct's picture

You will never be able to have a reserve currency without a trade defecit. Reserve currency status is the ultimate power, because it gets people to provide you with goods and services at the low-low price of relatively nothing. Right now, half the world has a quasi-merchanitilst setup to services the USA. Those countries would implode their own domestic ecnomoy if that resrve currency (USD) failed.

No, right now the elite have a desirable but delicate position. They will send the entire collective human race back into serfdom through a successive generations of stagflation. We've damn near already had two decades of it. It will only end with world government an an SDR, or if someone loses their never and blinks us all into WWIII.

sinbad2's picture

"You will never be able to have a reserve currency without a trade defecit."

 

OK now what does that actually mean?

It means the US loses money every year, eventually even the mighty United States reaches its credit limit.


The US dollar was the reserve currency and running a trade surplus up until the 70's.

The Vietnam war is the root of the current US economic problems. Because of the war Johnson sold American gold reserves, which forced Nixon to dump the gold standard.

They that sow the wind shall reap the whirlwind.

Jack&#039;s Raging Bile Duct's picture

USD only achieved its current status because of Bretton Woods (See: WWII). Prior to that it was one of several high confidence currencies. Trade deficits might not work for plebeians and mundanes like us, but it works wonders for the elite which control the "something for nothing" scheme.

From an elite standpoint, what your reserve currency cannot do, your MIC can. Take that statement and compare it against the current FIRE yankee economy, and warmongering tendencies.

Silver Savior's picture

I profit on the weak dollar. I in no way want strong dollars.

Seasmoke's picture

That's the Donald statement I've been waiting 3 months for !!!!!!

Happy Passover Tribe !!!!!

BigFatUglyBubble's picture

I am Jack's complete lack of surprise...