US senator calls for insider trading probe into Trump over tariff pause
Donald Trump could face an investigation into insider trading over his tariff flip-flop, as stocks plunged and US levies on Chinese goods rose again.
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Several US senators have called for an investigation into whether Donald Trump engaged in insider trading or market manipulation by encouraging people to buy stocks just before his dramatic reversal on global tariffs.
“Who in the administration knew about Trump’s latest tariff flip flop ahead of time? Did anyone buy or sell stocks, and profit at the public’s expense?” California Democratic Senator Adam Schiff posted on X on Wednesday.
“I’m writing to the White House - the public has a right to know,” he added.
Democratic members of the House Financial Services Committee wrote on X that “the President of the United States is literally engaging in the world’s biggest market manipulation scheme.”
The accusations came as Mr Trump posted a few minutes after Wall Street opened that “IT’S TIME TO BUY”.
A few hours later, he announced a 90-day suspension of additional tariffs against dozens of countries, with the exception of China, triggering a historic stock market rebound.
After several days of collapse, the Dow Jones index ended Wednesday up 7.87 percent, its biggest gain since 2008, and the Nasdaq up 12.16 percent, the most since 2001.
Mr Trump also signed his post on Truth Social with the letters “DJT” - both his initials and the stock market abbreviation for his media company, Trump Media & Technology Group. The company’s shares closed the day up 21.67 percent.
White House communications adviser Margo Martin posted a video on X late Wednesday showing Mr Trump receiving Charles Schwab, founder and co-chairman of the Schwab asset management, in the Oval Office.
“This is Charles Schwab,” Mr Trump said, introducing the 87-year-old billionaire to champion car racers.
“He’s not just a company, he’s actually an individual! And he made 2.5 billion (US dollars) today,” he said.
Former White House ethics lawyer Richard Painter also felt there was a case for investigation.
“Presidents are not investment advisors,” said Painter, who had served under the administration of former president George W. Bush.
“This scenario could expose the president to charges of market manipulation,” he told NBC.
The White House said Mr Trump only wanted to “reassure” the public.
“It is the responsibility of the president of the United States to reassure markets and Americans about their economic security in the face of constant media scaremongering,” White House spokesperson Kush Desai told the Washington Post.
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NEAR PANIC AT WHITE HOUSE AMID TRUMP’S TARIFF PAUSE
Donald Trump has acknowledged his decision to put a 90-day tariff pause in place has caused some “transition problems” and “near panic” in the White House and Wall Street dropped again.
“A big day yesterday. There will always be transition difficulty – but in history, it was the biggest day in history, the markets. So we’re very, very happy with the way the country is running. We’re trying to get the world to treat us fairly,” Mr Trump said at the White House.
“We think we’re in very good shape. We think we’re doing very well. Again, there’ll be a transition cost and transition problems, but in the end, it’s going to be a beautiful thing.”
The US President praised his Cabinet, whom he has tasked with plans on how to proceed with trade deals and negotiation with China in what is becoming an intensifying trade war with Beijing.
“Everyone at this table is doing an incredible job, by the way, I have to say. Incredible. And the relationships are – it’s like they’re friends, they’re really. The relationships are very strong, really good, really strong. And these meetings are very good,” Mr Trump said.
US media reports suggested that Mr Trump’s top economic advisers had disagreed internally and publicly about the tariffs. There were reports of “near panic” in the White House hours before the US President paused his “Liberation Day” tariffs.
It comes as NBC News reported that it was a “harrowing week” for the US government.
“His own aides had quietly raised alarms about the financial markets,” NBC reported.
“Ahead of Trump’s announcement, some of his advisers had been in a near panic about the bond markets, according to a senior administration official.
“Interest rates on 10-year Treasury bonds had been rising, contrary to what normally happens when stock prices fall and investors seek safety in treasuries.
“The unusual dynamic meant that at the same time the tariffs could push up prices, people would be paying more to buy homes or pay off credit card debt because of higher interest rates. Businesses looking to expand would pay more for new loans.”
US media reports said that Mr Trump’s top economic advisers sparred internally and publicly about the tariffs, with Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick emerging as top voices in the US President’s ear leading to his decision.
US-CHINA TRADE WAR INTENSIFIES
The US-China trade war intensified on Thursday local time, sending the global economy into unknown territory and dampening relief after Mr Trump’s earlier climbdown from a wider tariff onslaught against the rest of the world.
The White House clarified that Mr Trump’s big hike in tariffs on China announced 24 hours earlier had actually taken his total levies this year on imports from the world’s second biggest economy to a staggering total of 145 per cent -- not the previously reported 125 per cent.
This was because latest tariff hike comes on top of a 20 per cent tariff already imposed earlier. China has retaliated with levies of 84 per cent on US imports.
The superpower confrontation threw a deep shadow over jubilation that Mr Trump was retreating from threats to impose punishing tariffs on dozens of other countries -- everywhere from European Union allies to Asian manufacturing hubs like Vietnam and even tiny, remote ocean islands.
Mr Trump maintained a blanket 10 per cent tariff on most countries. However, his retreat from more damaging levies against European countries prompted the EU to pause plans for its own retaliation.
Amid relief, Asian and European stock markets rocketed, with Tokyo closing 9.1 per cent higher.
But realization that Mr Trump’s splashy about-face on Wednesday masked the reality of a surging trade war with China dampened spirits.
The Dow Jones in New York fell more than three per cent and the S&P dropped 4.5 per cent in morning trading. Gold prices hit a record high as the US dollar crumbled.
EU TO PAUSE RETALIATORY TARIFFS
The European Union will pause its first countermeasures against US tariffs after Donald Trump temporarily lowered the hefty duties he had just imposed on dozens of countries, European Commission chief Ursula von der Leyen said.
The bloc was due to launch counter-tariffs on about 21 billion euros (A$38 billion) of U.S. imports from next Tuesday in response to Mr Trump’s 25 per cent tariffs on steel and aluminium. It is still assessing how to respond to US car tariffs and the broader 10 per cent levies still in place.
“We want to give negotiations a chance,” Ms von der Leyen said on X. “While finalising the adoption of the EU countermeasures that saw strong support from our Member States, we will put them on hold for 90 days.”
Mr Trump’s sudden decision to pause most of his hefty new duties brought relief to battered global markets and anxious global leaders, even as he ratcheted up a trade war with China.
His about turn, which came less than 24 hours after steep new tariffs kicked in, followed the most intense episode of financial market volatility since the early days of the Covid pandemic.
US stock indexes shot higher on the news, and the relief continued into Asian and European trading on Thursday local time.
Before Mr Trump’s U-turn, the upheaval had erased trillions of dollars from stock markets and led to an unsettling surge in US government bond yields that appeared to catch the US President’s attention.
Meanwhile, China rejected what it called threats and blackmail from Washington.
Trump kept the pressure on China, the world’s No. 2 economy and second-biggest provider of US imports, with an increase of tariffs on Chinese imports to 125 per cent from the 104 per cent level that kicked in on Wednesday local time.
He also signed an executive order aimed at reducing China’s grip on the global shipping industry and at reviving US shipbuilding.
TRUMP’S 10 PER CENT TARIFFS ‘GOING TO BE THE BASELINE’
Meanwhile, Mr Trump’s top economic adviser said the 10 per cent tariff for almost all countries except China will likely remain in place going forward.
On Wednesday local time, Mr Trump announced a 90-day pause on higher tariffs against all countries except China, reversing a policy that had roiled global stock markets and spooked the American bond markets — a key barometer of investors’ faith in the US government’s ability to pay its debts.
Mr Trump’s announcement leaves China facing a steep 125 per cent tariff, and almost all other countries facing a baseline tariff of 10 per cent.
Speaking to CNBC before markets opened on Thursday in New York, Kevin Hassett, the director of the White House National Economic Council, said that the 10 per cent was likely here to stay.
“I think everybody expects the 10 per cent baseline tariff is going to be the baseline,” he said. “And it is going to take some kind of extraordinary deal for the president to go below there.” Mr Hassett said the sharp rise in bond market yields in recent days had added “perhaps a little more urgency” to Mr Trump’s decision to roll back some tariffs, but insisted that the decision would have ultimately have happened anyway.
“The president recognises that in order to get the big change that we need for America’s workers … we need to create enough pressure on our trading partners that things that American presidents have been asking for, for the last decades are actually offered at the table,” he said.
– with AFP
Originally published as US senator calls for insider trading probe into Trump over tariff pause
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