Trump channels Hoover’s economic strategies

President Trump has saved dozens of US jobs from moving to other countries, mostly Mexico, by employing the shock and awe of a personal phone call to CEOs. Had he made the same visits before he became president he likely would have failed. And let’s not discuss the numbers of jobs his policies will cost the US that go unreported.

Another Republican president used a similar style to “encourage” business to comply – Herbert Hoover. Before he scaled the political mountain to the presidency, Hoover had become famous as an organizer of humanitarian efforts. He led 500 volunteers in distributing food, clothing, steamship tickets and cash to Americans in Europe to help them get home after war broke out in Europe in 1914. Later he worked to feed starving Belgians. The Belgian city of Leuven named a prominent square after him – Hooverplein.

What the market has in common with Trump

Watching this market is like watching Trump’s candidacy. Everyone is waiting for both to crash and burn but they keep climbing to greater heights. Even Fox News appears to oppose Trump without much effect just as the stock market sets new records in the midst of gloomy economic news all around.

The market has set new records even as profits are expected to have fallen for the fourth consecutive quarter. Earnings season is upon us and we will soon understand how bad the damage in the second quarter was. Thomson Reuters has predicted that profits in Q2 will be down about 5% from the same quarter last year. Revenue will have fallen 0.8%. It blames oil prices, low interest rates, and a saturated cell phone market.