Financial encyclopedia

In recent years, a notable phenomenon has emerged in the financial market: whenever there is a significant correction in the US stock market, Trump always promptly "softens his stance", releasing positive news or making policy concessions. 

This pattern of interaction between the market and policy is called the "Trump Put". 

What is a Trump Put? 

"Put" is originally a financial instrument, representing a put option, which can provide protection for investors when the market declines. 

The "Trump Put" refers to the fact that whenever the market experiences sharp fluctuations, Trump will intervene through policies such as suspending tariffs, releasing negotiation news, or promoting fiscal stimulus, acting as a "human stop-loss" for the market. 

Three typical examples 

In 2018, the trade war between China and the United States intensified, and the US stock market declined for several consecutive days. Trump immediately stated that the two sides were "engaging in constructive dialogue", and the market sentiment clearly stabilized. 

In 2019, after announcing the imposition of tariffs on Chinese electronic products, panic ensued. Within days, the implementation was suddenly postponed on the grounds of "avoiding impact on Christmas consumption." 

In 2025: After the introduction of the 145% "reciprocal tariffs", the US stock market plunged sharply for two days. Less than two weeks later, the US reached a 90-day tax reduction agreement with China and simultaneously suspended the increase of tariffs on other countries. 

Potential Consequences and Risks 

Weaken policy pressure: If your opponent knows you are afraid of the market falling, they will naturally be more assertive during negotiations. 

Fueling speculative sentiment: Market expectations that the government will guarantee the bottom line have led to funds engaging in speculation based on rumors rather than fundamentals. 

Loss of policy trust: Excessively predictable intervention behaviors have reduced policies to short-term trading signals. 

Why is Trump so afraid of a market downturn? 

The performance of the stock market is its political KPI. It calls itself the "King of the Market", and a decline in market conditions would shake the foundation of its political achievements. 

The Republican Party's electoral prospects, the support of major donors, and the sentiment on Wall Street are closely related. A falling market equals rising pressure. 

Trump has intricate ties with the real estate and financial circles. If the market remains unstable for a long time, it will harm his connections and interests. 

The original meaning of "put" is to protect, but once it turns into a reflexive concession, it becomes a symbol of vulnerability.