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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsThe Fantastically Profitable Mystery of the Trump Chaos Trades
The presidents talk can move marketsand its made some futures traders billions. Did they know what he was going to say before he said it?
In the last 10 minutes of trading at the Chicago Mercantile Exchange on Friday, September 13, someone got very lucky. Thats when he or she, or a group of people, sold short 120,000 S&P e-miniselectronically traded futures contracts linked to the Standard & Poors 500 stock indexwhen the index was trading around 3010. The time was 3:50 p.m. in New York; it was nearing midnight in Tehran. A few hours later, drones attacked a large swath of Saudi Arabias oil infrastructure, choking off production in the country and sending oil prices soaring. By the time the CME next opened, for pretrading on Sunday night, the S&P index had fallen 30 points, giving that very fortunate trader, or traders, a quick $180 million profit.
It was not an isolated occurrence. Three days earlier, in the last 10 minutes of trading, someone bought 82,000 S&P e-minis when the index was trading at 2969. That was nearly 4 a.m. on September 11 in Beijing, where a few hours later, the Chinese government announced that it would lift tariffs on a range of American-made products. As has been the typical reaction in the U.S. stock markets as the trade war with China chugs on without any perceptible logic, when the news about a potential resolution of it seems positive, stock markets go up, and when the news about the trade war appears negative, they go down.
The news was viewed positively. The S&P index moved swiftly on September 11 to 2996, up nearly 30 points. That same day, President Donald Trump said he would postpone tariffs on some Chinese goods, and the S&P index moved to 3016, or up 47 points since the fortunate person bought the 82,000 e-minis just before the market closed on September 10. Since a one-point movement, up or down, in an e-mini contract is worth $50, a 47-point movement up in a day was worth $2,350 per contract. If you were the lucky one who bought the 82,000 e-mini contracts, well, then you were sitting on a one-day profit of roughly $190 million.
A week earlier, three minutes before the CME closed on September 3, someone bought 55,000 e-mini contracts, with the index at about 2906. At around 9 p.m. in New York9 a.m. in Hong Kongthe market started moving and kept rallying for the next six hours or so, reaching 2936. Around 2 p.m. in Hong Kong2 a.m. in New YorkCarrie Lam, the Hong Kong leader, announced that she would be withdrawing the controversial extradition bill that had been roiling the city in protest for months. Whoever bought those e-mini contracts a few hours earlier made a killing: a cool $82.5 million profit.
More: https://www.vanityfair.com/news/2019/10/the-mystery-of-the-trump-chaos-trades?utm_source=twitter&utm_medium=social&utm_campaign=onsite-share&utm_brand=vanity-fair&utm_social-type=earned
MelissaB
(16,420 posts)MelissaB
(16,420 posts)Link to tweet
Salviati
(6,008 posts)It's inconceivable that they aren't taking advantage of this.
rzemanfl
(29,556 posts)took office. See, e.g., Manitowoc Company stock and steel tariffs
Been saying that since the first month or so, too.
Miguelito Loveless
(4,465 posts)that the entire point of the Trump presidency was insider trading.
Mike Niendorff
(3,460 posts)Trump threatening to crash Turkish economy:
* " (have done before!)" (via Twitter)
* "and I will!" (direct threat to Erdogan, released today)
As if it even needs to be said: these are straight-up admissions that he KNOWS how to manipulate markets and the he HAS ALREADY manipulated markets.
MDN
peggysue2
(10,828 posts)In fact, he called tonight from Utah and I told him about this Vanity Fair article. He's on a wilderness hike right now with sporadic communication. But he wasn't surprised. He said, "I told you, this SOB has been manipulating the markets in broad daylight. Not just for fun but for gobs of profit."
Obviously, I should listen to my very smart son more often!
The other thing is how the regulators have turned a blind eye. The corruption is massive.