Donald Trump didn’t wait for the opening bell before blaming Monday’s market sell-off on Vice President Kamala Harris.
“Stock markets are crashing, jobs numbers are terrible, we are heading to World War III, and we have two of the most incompetent ‘leaders’ in history,” the former president and Republican presidential nominee wrote in a post on Truth Social at 8:12 a.m. Eastern time. “This is not good.”
Trump did not mention that markets had suffered far greater single-day losses when he was president, or that economists blamed a variety of factors — including a disappointing July jobs report, a plunge in Japanese markets earlier in the day and a growing consensus among investors that the Federal Reserve has waited too long to start cutting interest rates — for Monday’s slide.
He also did not mention that earlier this year, he had claimed credit for a surge in stock prices, which he said reflected confidence he would be reelected.
What Trump was engaged in was a calculated attempt at political marketing. By 9:45 a.m. Monday, less than an hour after U.S. markets opened, Trump branded what would become a 3% decline for the day in the S&P 500 the “Kamala Crash.”
By lunchtime, it was official party messaging: The Republican National Committee hyped the “Great Kamala Crash of 2024,” and the Trump campaign had produced and circulated on social media a video tying the vice president to Monday’s dip in the markets. By the afternoon, the Trump forces had turned “KamalaCrash” into a “trending” subject on the social platform X.
The coordinated effort underscored Trump’s long-standing fixation on stock indexes as a barometer of economic health and even as a substitute for polls — a measure of his own performance and popularity. Yet markets can rise and fall sharply from day to day; Japan’s stock exchange surged in early trading on Tuesday after big losses on Monday.
It also reinforced the degree to which economic messaging, and the health of the economy itself, will play a key role in the sprint finish before the presidential vote in November.
“What middle-class families need is steady economic stewardship, not chaotic ranting lies,” Ammar Moussa, a Harris campaign spokesperson, responded in a statement. “Donald Trump had the worst jobs record of any modern president, and oversaw some of the worst days in the stock market in history while spending his presidency lining the pockets of his wealthy friends who shipped American jobs overseas. Economic experts agree: His plans would raise costs on working families by $2,500 a year and ‘supercharge inflation.’”
Harris has stressed economic optimism in her speeches. She portrays the economy as strong and tries to cast Trump’s policy proposals, like new taxes on imported goods, as a threat to growth and a possible spark of recession.
“We believe in a future that keeps America’s economy the strongest in the world,” she said in Houston last week. “Where every person has the opportunity to build a business, to own a home, to build intergenerational wealth.”
American voters consistently tell pollsters that the economy and consumer prices are the most important issues facing the country. Trump and his presumptive Democratic opponent, Harris, are seeking to sell voters on diametrically opposite stories about the economy’s health.
Trump wants voters to believe that the economy is on the brink of catastrophe and that Harris and President Joe Biden are to blame. He has leaned into a negative view of the economy that until now has largely focused on the nation’s prolonged bout of high inflation earlier in Biden’s term.
Polls have consistently shown that a majority of Americans believe the economy is in recession, even though economic statistics suggest it is not, a fact that vexed Biden as he tried to campaign on the actual record. Economic growth was surprisingly strong in the first half of the year. Job growth has remained relatively strong, even with the slowdown in job creation in July. Inflation has finally fallen to more normal historical rates.
None of that data has done much to change voter concerns. And it has not stopped Republicans from warning repeatedly in the last few years that the economy was tipping into a downturn. Monday was no different.
“This moment could set off a real economic calamity around the globe,” Sen. JD Vance of Ohio, Trump’s running mate, posted on X on Monday. “It requires steady leadership — the kind President Trump delivered for four years.”
(Trump’s presidency included a rapid descent into a pandemic recession in 2020, including a steep drop in the stock market that was followed by a rebound that summer.)
Trump has set up this moment as a heads-he-wins, tails-she-loses scenario. He took credit for the stock market’s double-digit gains earlier this year — claiming it was booming because investors thought he would be president next year. Now that global markets are falling, Trump is claiming it’s the fault of Biden-Harris policies.
Economists and analysts dismissed Trump’s stock-market boasts earlier this year and his critique of Harris on Monday.
“Typically presidents take credit when the market is up and are probably unfairly blamed when the market is down,” said Chris Krueger, who works at the research group TD Cowen.
Krueger pointed to the plunging Nikkei, which fell 12.4% Monday, its biggest decline since the Black Monday crash of October 1987. “How any U.S. politician bears responsibility for that is a bit mystifying, but that’s sort of table stakes for where we are in the 2024 election,” he said in an interview Monday.
Goldman Sachs economists raised their odds of a recession in the next year on Monday to 25%, from 15%. Alec Phillips, Goldman’s chief political economist, said there was little evidence the sell-off was hurting Harris right away, citing election prediction markets.
“Harris’ odds in prediction markets didn’t move following the jobs report on Friday, and are still at basically the same level now,” Phillips said, “so at least the consensus view so far is that these numbers alone don’t have much bearing on the election outlook.”
The Federal Reserve could still affect the outlook, though. If officials at the central bank cut interest rates in September, they could help to push down borrowing costs for Americans buying homes, cars and other big-ticket items on credit — a move that White House economists have long believed could help reinforce the idea that inflation is under control and that the outlook for consumers is improving. That could help Harris, especially if the Fed makes a larger-than-expected rate cut in a bid to jolt economic activity.
But many Democrats worry that the Fed, by holding rates steady last month, may have hurt Harris — by opening the door for the market sell-off, which appears to be driven in part by investors’ fears that Fed officials waited too long to start cutting rates.
Trump is trying to use the market sell-off as a political weapon to disrupt what has been two weeks of nonstop momentum and positive news coverage for Harris since she effectively became the Democratic Party’s standard-bearer. She has drawn about level with Trump in polls, broken a monthly fundraising record for 2024, attracted a flood of new volunteers in battleground states and given hope to despairing Democrats everywhere.
Over the same period, Trump has made unforced errors, including his decision over the weekend to attack the popular Republican leader of a must-win state: Gov. Brian Kemp of Georgia. Instead of sticking to policy-focused attacks on Harris, Trump has resorted to race-baiting, falsely claiming to a room full of Black journalists that she only recently decided to identify as Black.
Trump’s advisers insist that the fundamentals of the race haven’t changed. Two weeks ago, soon after Harris replaced Biden as the likely nominee, Trump’s pollster and senior adviser, Tony Fabrizio, predicted in a memo that she would take a lead in the polls, benefiting from the “honeymoon” effect.
The Trump team is working off the theory that Harris’ “honeymoon” will wear off once voters learn about her liberal record as a prosecutor and a senator before her time in the White House. And they think her support will further soften the more they can link her to the most unpopular aspects of Biden’s record — especially on immigration and inflation.
The Trump team thinks that over time, external events like a falling stock market and a potentially expanding conflict in the Middle East will give them additional ammunition to define Harris the way they hope to: as weak, incompetent and “dangerously liberal.”
Monday’s sell-off has given the Trump campaign its first opportunity to test that thesis — a chance for a reset and to break back into the news cycle that Harris has dominated from the moment Biden announced he would abandon his reelection bid, three Sundays ago.
“Obviously the events provide the Trump campaign and Donald Trump the ability to demonstrate even more forcefully the reason why the last three and a half years have been a failure,” Chris LaCivita, one of Trump’s top campaign aides, said in an interview Monday.
This article originally appeared in The New York Times.
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