Photographer: Yorgos Karahalis/Bloomberg

Unbiased News? There's One Reliable Source

For an assessment of Trump, the stock market is as pure and simple as it gets. Up = good. Down = bad.

Democrats trust only Democratic-approved media sources, and Republicans trust only Republican-approved media sources. Perhaps the only medium that both Democrats and Republicans will accept as a valid source of information is … the stock market.

With the stock market, there is a price at which one can buy or sell. And that's that. No alleging that Fox News peddles "alternative facts," or MSNBC spins.

Additionally, for anyone with their wealth in financial assets, movement in the stock market affects their net worth and retirement prospects. Even for conspiracy theorists who might believe the stock market is rigged by the Fed or the powers that be or whomever, at the end of the day you can log into your account or check your quarterly statement and see your account balance in dollars. No one can convince you that the Trump era has been good for your finances if you're looking at your decimated portfolio, and no amount of harsh news coverage of the president will change how you feel about a rising balance.

For someone as obsessed with popularity as President Donald Trump, this means that the stock market may be crucial to his mood and his perceived mandate, in a way that it hasn't been in the past. He's said on television that the stock market went up because business people love him. In the past there's been the notion of a "Fed put," that the Federal Reserve would respond to lower equity prices with more monetary stimulation. This may end up morphing into a "Trump put" by which the Trump administration may respond to a falling stock market with new tweets or executive orders meant to goose stocks higher. More than most presidents, Trump will treat the stock market as a referendum on his administration, no different from television ratings or crowd counts.

Even if the stock market always produces a price at which someone can buy or sell, it's subject to the same flaws and biases as political polls or partisans living inside of a filter bubble. As the Federal Reserve noted in its meeting statement this week, since the election, while measures of sentiment, including the stock market, have increased, business fixed investment remains subdued. Markets, for now, have bought into the Trump hope, but markets are inherently fickle, and a couple bad weeks of economic data or drama coming out of Washington could change the mood, and hence the markets, in a hurry.

We're already seeing signs that hopes of "Trumpflation" may be souring in the investment community. Ray Dalio, head of Bridgewater, came out this week saying he was concerned that the populist elements of the Trump agenda could undermine the more pro-business aspects. Financier Anthony Scaramucci, seen as a liaison between Trump and Wall Street, may be in line for an ambassadorship rather than an economic advisory role, more like banishment to Siberia than a spot in the inner circle.

With the Republican majority in the Senate so slim, any loss of support would be crippling to the Trump administration. Voters more focused on their finances and businesses than on politics could look at the Democratic and Republican "filter bubbles" and not be sure which side to take. But they'll definitely respect the market's ups and downs.

So the stock market will be watching and reacting to Trump, while Trump watches and reacts to the stock market. For Americans whipsawed by both, it may turn into quite a taxing experience, from a supposedly low-tax administration.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

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    Conor Sen at

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