President Trump's penchant for viewing the stock market's performance as a barometer of his presidency's success is widely known to the public by now. So the fact that Trump has been extremely agitated by goings-on back home during his trip to India this week is hardly a surprise.
Usually, we don't give much credence to the Washington Post's inside-baseball stories purporting to offer a 'peak behind the curtain' while creating a venue for vindictive officials to exact their revenge by anonymously trashing the president or rivals within the administration.
But today, WaPo's account basically confirms what we suspect has been unfolding behind the scenes, with the president turning on yet another federal agency and blaming it for spooking the markets. In the past, Trump has (either publicly or privately) blamed Democrats, Treasury Secretary Mnuchin, Labor Secretary Wilbur Ross, Boeing and - of course - Jay Powell for the market selloffs.
Now, we can add the CDC to that list.
The paragraph below is basically the heart of WaPo's story, describing President Trump's impotent fury at helplessly observing the selloff from afar.
While he has spent the past two days traveling in India, Trump has watched the stock market’s fall closely and believes extreme warnings from the Centers for Disease Control and Prevention have spooked investors, the aides said. Some White House officials have been unhappy with how Health and Human Services Secretary Alex Azar has handled the situation, they said.
Specifically, Trump was furious at the CDC for its press conference on Tuesday which appeared to rattle the market and cemented the selloff for a fourth day. The No. 1 rule for successful propaganda is to make sure your source still appears credible to the unengaged reader or viewer. When one insists on pushing a narrative that is completely divergent from the lived experience of millions, credibility can be damaged.
"You don’t want to overly feed the darkness, but if you seem like all you do is happy talk then you lose credibility," said Gene Sperling, who served as a top economic adviser during the Clinton and Obama administrations. "You get a three-hour high from your happy talk, but lose the long-term ability to be seen as serious, factual and potentially reassuring at a later point when it might be justified. This White House may already be in danger of losing the capacity to be seen as serious."
Just like the State Department's decision to bring back 14 infected Americans during their evacuation of the 'Diamond Princess', the administration's approach has left it open to criticism - at least, according to the Washington Post.
Now, White House officials’ efforts to contain the economic fallout from the coronavirus have created new political hazards, as they publicly play down the threat while other federal officials with a background in health and diseases are warning of more severe consequences for inaction. The administration also risks creating new health hazards, should the pressure to assure investors of economic stability undercut its public health message about the mounting threat.
In a statement, the White House defended its response, saying comments have been taken out of context or twisted to distract from the Trump administration’s efforts so far. Administration officials strongly denied that the CDC and White House economic team were at odds on Tuesday.
At least one analyst appeared to agree.
"The CDC is probably more credible about the risks from the coronavirus than anything the Trump economic officials say," said Chris Rupkey, chief financial economist at MUFG Union Bank. "The market is coming down on the CDC."
On CNBC, guests complained that the administration's message sounded muddled and confused yesterday, which certainly didn't help boost the market's confidence. Fortunately for investors, the administration has refined its message, as Kudlow and others insisted that Trump's warnings represent "where we are now", while the CDC is focused on staving off the worst-case scenario.
A snippet from Kudlow's appearance on CNBC yesterday is one example:
"We have to err on the side of emergency planning in the United States. They are doing the right thing," Kudlow said of CDC officials. "I have to worry about the economy and the financial markets ... There’s a fear factor right now, and I get that, but what I was trying to say is this thing is not going to go on forever, and our economy is in great shape."
The White House also blamed Democrats and accused them of trying to deliberately trying to scare markets in an effort to sabotage Trump.
"Unfortunately what we are seeing today is a political effort by the Left and some in the media to distract and disturb the American people with fearful rhetoric and palace intrigue," White House spokesman Judd Deere said in a statement.
"The United States economy is the strongest in the world thanks to the leadership and policies of President Trump. The virus remains low risk domestically because of the containment actions taken by this Administration since the first of the year."
And let's not forget the Dems media allies.
Low Ratings Fake News MSDNC (Comcast) & @CNN are doing everything possible to make the Caronavirus look as bad as possible, including panicking markets, if possible. Likewise their incompetent Do Nothing Democrat comrades are all talk, no action. USA in great shape! @CDCgov.....— Donald J. Trump (@realDonaldTrump) February 26, 2020
President Trump initially dismissed the virus during his trip to Davos in January, and has issued a string of optimistic tweets this week, including encouraging investors to 'buy the f--king dip' on Monday. Unfortunately, those who took the president's advice probably got smoked.
With more than 50 cases confirmed in the US and the CDC warning about imminent community outbreaks, Trump's words can sound jarring. But remember: The better prepared everyone is, the less likely the virus will spread. And nothing inspires this type of behavior quite as effectively as genuine paranoia.
The only problem is, it will take time before we know for sure whether the Trump Administration's travel restrictions were effective.
Trump will address the outbreak at 6 pm ET. Watch it live here.
Meanwhile, before we go, we'd like to point out another angle that was unsurprisingly overlooked by WaPo: the CDC's Dr. Nancy Messonnier is the sister of the former Deputy Attorney General Rod Rosenstein, the one who appointed Special Counsel Robert Mueller and was eventually fired by President Trump following a tense overall tenure.
Is it possible she could be part of the resistance?
Also, as we've pointed out previously, the CDC's diagnostic tests have malfunctioned and only a few states and local health agencies have any tests on hand.
Is Trump being set up?