Commentary—Much ado About Something Else. Donald Trump, the US Stock Market, and the Public Interest Ethics of Social Media Communication

Abstract

We analyze Donald J. Trump’s Twitter activity over the last months of the 2016 presidential campaign, his period as President Elect, and his Presidential term until Fall 2019, shortly before the outbreak of the pandemic. Trump weaponized social networks as a communication tool to build influence on the financial market and the public opinion. We relate Trump’s communication on Twitter to the dynamics of the NASDAQ100 trend over the whole period of study as well as two subperiods, pre-presidential versus presidential. We find that Trump’s hyperactivity on Twitter is followed by a negative market trend, and that tweets covering politically, and economically sensitive topics seem to negatively impact the market, except for real economy-related tweets. Some topics positively received by the market in the pre-presidential phase (e.g., China) become anticipators of negative trading days during the presidential one. We also consider the emotional tone of Trump’s tweets and find an unexpected reversal of the communicative valence of the tweets as to their expected impact on the stock market. Positive sentiment tweets seem to be followed by negative market performance and, maybe more surprisingly, vice versa. It seems that, during the period of observation, the market has learnt to interpret the emotional tone of Trump’s tweets as instrumental to Trump’s political strategy. In particular, the market seems to have realized that negative sentiment in Trump’s communication was entirely functional to political consensus building and not meant to convey market-relevant information. This is at odds with the idea that presidential communication should reflect the public interest, and especially so when it has major implications for the economy. Trump’s use of social media during both his presidential campaign and term questions the principle that institutional responsibility in the digital realm implies treating the infosphere as a commons. We discuss the implications for the functioning of the stock market and the emerging public interest ethical issues related to the breakdown of such principle.