"If you take it at face value, you lose on that trade. You turn around and you wait for him to walk it back, and on that day you buy. And it's been buying ever since that moment that he dialed it back last year set up the rally that continued for the rest of the year [which lasted] until the last couple of days."
"What the market has found out is that it doesn't matter [what Trump threatens] it doesn't matter!"
"This is forever, Trump said."
Traders have begun to discount President Trump's initial threats and instead position to buy after expected walk-backs. Markets jumped when Trump announced a framework to acquire Greenland and said he would cancel planned tariffs on eight European countries, easing investor worries and even ruling out military action. Traders referenced last April's tariff threat and subsequent walk-back that sparked a broad rally, prompting a strategy of waiting for reversals before buying. Colleagues called the pattern the "Art of the Threat." CNBC conducted the first interview after the announcement; major indices rose, with the Nasdaq up 1.18%.
Read at www.mediaite.com
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