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On top of that, you have Trump tweeting negatively about Amazon. This pushed AMZN down for a third session now, snowballing with it a lot of others. He basica

On top of that, you have Trump tweeting negatively about Amazon. This pushed AMZN down for a third session now, snowballing with it a lot of others. He basically brought down the economy he is responsible for.

AznHisoka 9y ago
But why do investors have to respond to Trump's tantrums? Why don't they collectively just ignore him?
- dragontamer 9y ago
  Because Trump controls the US Postal Service, by nature of being the president. If Mr. Trump wants the USPS to screw Amazon over, he has the power to do so. Its clear that Mr. Trump doesn't care about the long-term survivability of the USPS anyway, so he certainly has the power to "weaponize" the USPS and change its terms to become anti-Amazon. On the contrary to your post: it is the JOB of investors to pay attention to the US President, as well as the powers he has... to keep your investments safe. Its your 401k retirement at risk here. Therefore, it behooves you to move your money to safer pastures if the President is making threats.
  - mullen 9y ago
    > If Mr. Trump wants the USPS to screw Amazon over, he has the power to do so. Its clear that Mr. Trump doesn't care about the long-term survivability of the USPS anyway, so he certainly has the power to "weaponize" the USPS and change its terms to become anti-Amazon. No, he can't. There are laws in place to prevent the USPS from changing the price based on who is shipping. The USPS is Net Neutrality at its best.
    - dragontamer 9y ago
      > No, he can't. Uh huh. Let me get more specific then. https://www.scribd.com/document/254642175/Amazon-USPS-Sunday-Deal https://www.scribd.com/document/254642175/Amazon-USPS-Sunday... What is preventing Mr. Trump from tearing up this contract for Amazon Sunday Deliveries? Hint: absolutely nothing. Mr. Trump can destroy the USPS's revenue AND hurt Amazon at the same time if he so wished. I guess destroying the contract will take 30 days, but in any case, Mr. Trump can make "Sunday USPS deliveries" of Amazon goods incredibly more expensive in just one month. Mr. Trump may need to fire a few Post Office directors, but Mr. Trump doesn't really seem to care too much about the turnover of this organization he's running.
      - mullen 9y ago
        [I am going to respond to thrillgore and dragontamer in this post because the HackerNews software won't let me respond to both posts] > "There are laws in place" is literally dismissing anything he can do; because its clear he's gone over the law before (the travel ban), he'll do it again, and again, and again, until the law has no foundation left to stand on. And he lost on the travel ban, twice. In fact, when you look at what he has done that are against the law, he gets smacked down. He does not win on such things. > Hint: absolutely nothing. Mr. Trump can destroy the USPS's revenue AND hurt Amazon at the same time if he so wished. I guess destroying the contract will take 30 days, but in any case, Mr. Trump can make "Sunday USPS deliveries" of Amazon goods incredibly more expensive in just one month. There would be complete shitstorm if he did that since USPS makes money on the Amazon contract. Trump does not rule in a vacuum and even his shills in Congress would come down on him if Amazon packages stopped being delivered. Plus, Jeff Bezos can put messages at the start of every Amazon Prime Moive/Show asking for Amazon customers to call their Congress person to complain. Little message on Amazon.com on why there is no Sunday delivery would be a shitstorm to Congress. Trump might be the President but Jeff Bezos has millions of US voters using his website every day. I also guarantee that more people like Amazon.com than Trump.
        dragontamer 9y ago
        > There would be complete shitstorm Erm, Trump doesn't seem to care about the number of shitstorms he causes. If anything, Trump (and his base) are HAPPY when they get shitstorms. "Drain the Swamp", "Snub the coastal elites", etc. etc. If Trump wanted to prevent shitstorms, maybe his Cabinet-level officials wouldn't leave every 3 or 4 months. Trump doesn't care about Congress or laws. He just does whatever he can do. Sure, the courts smack him down sometimes, but the power of the Executive Order means he truly can hurt Amazon (to the detriment of greater America) if he really wanted to. ---------- There are PLENTY of powers Mr. Trump can do. The Justice Department can investigate Amazon for antitrust. So can the FCC. Heck, the FCC just got rid of net neutrality (due to Mr. Trump's most recent appointee). Demonstrating the power over the Internet that Mr. Trump wields. USPS is just the most obvious way (IMO) that Mr. Trump can hurt amazon. And it seems to be the one that Mr. Trump's tweets are focusing on.
    - thrillgore 9y ago
      But the President can divert funding and fire the Postmaster General. "There are laws in place" is literally dismissing anything he can do; because its clear he's gone over the law before (the travel ban), he'll do it again, and again, and again, until the law has no foundation left to stand on.
      - leesalminen 9y ago
        My understanding is that the President does have the power to control immigration under certain circumstances (national security). Please correct me if I’ve been reading too much fake news :). Edit:: a cursory Google search seems to indicate that the President can indeed limit immigration [0]. [0] http://www.latimes.com/politics/la-na-pol-travel-ban-legal-analysis-20170206-story.html http://www.latimes.com/politics/la-na-pol-travel-ban-legal-a...
- neaden 9y ago
  Because they are worried he's actually going to do something? What he might do I don't think anyone could really tell you, but the possibility that he does something that hurts their business is real.
- existencebox 9y ago
  To make a comical point out of a depressing topic: You and I might be so wise as to ignore if, for instance, a goat started telling us it was going to come after us and steamroll our houses. Put the goat behind the wheel of a tank with a brick on the gas pedal, and I think you may start to see why there's a degree of real fear behind what otherwise would be off-kilter ranting from a surprisingly loquacious ungulate.
- hueving 9y ago
  Despite his constant hyperbole, left-leaning folks seem to take everything he says very seriously and react emotionally to it.
  - dragontamer 9y ago
    https://twitter.com/realDonaldTrump/status/980063581592047617 https://twitter.com/realDonaldTrump/status/98006358159204761... Mr. Trump is directly attacking Amazon, and is saying that he wishes to change USPS rules to extract more money from the Amazon deal. Its not "emotional" to sell Amazon stock after this tweet. Its common sense. Mr. Trump clearly has the power to hurt Amazon, and he's threatening them. So as an investor, why SHOULDN'T I sell Amazon in light of this news?
    - kolpa 9y ago
      You shouldn't "sell" on this or any news, you should lower your buy/sell price, which you should always have pending.
  - nkozyra 9y ago
    This doesn't add anything to the conversation. The market is responding to things that have the potential to impact what they're investing in. It's not a political or even emotional response.
    - hueving 9y ago
      Panic selling is always an emotional response. There is no forward earnings analysis going on here, just "get the fuck out of the market" selling.
- ironjunkie 9y ago
  Because it's game theory. It only works if everyone's ignore him. But as soon as one person doesn't ignore him and start "panick selling", everyone else loses.
  - dragontamer 9y ago
    > It only works if everyone's ignore him. The President is the leader of the USA. You cannot ignore him. When Trump / Jeff Sessions announced that they were going after marijuana, marijuana stocks fell. Trump announces tariffs on Aluminum, users of aluminum fell (ie: Ford). Making Aluminum and Steel 25% more expensive in the US has long-term effects you cannot ignore. You CANNOT avoid Mr. Trump or his tariffs. You can't dig your head into the ground and "ignore him". When Mr. Trump decides to do something, it has cascading effects on the rest of America. Mr. Trump controls the FBI, the DEA, the FTC, the FCC, the USPS. Directly. Mr. Trump can add and remove policies from these great agencies without even asking for anything from Congress. Pure, unilateral power of the executive order. You CANNOT ignore this power. Its how America works.
    - r00fus 9y ago
      So did this not happen during the Obama administrations because Obama didn't have verbal diarrhea?
      - dragontamer 9y ago
        It happened under the Obama administration. In fact, Mr. Obama demonstrated how it could be a weapon for good. Mr. Obama encouraged taxes to benefit solar-manufacturers and electric car companies. This caused those stocks to go up, and investments into green-energy to flourish. Sure, there were some failures (see Solyndra), but I think it was overall a net-benefit to the USA. We're now manufacturing advanced Solar Panels that are better than a lot of other countries (although China is still manufacturing them cheaper...). And Tesla greatly benefited from the tax-break on electric cars. That's the sort of thing a President is SUPPOSED to do: use his powers to lead the nation. Trump is using his powers to turn us against each other.
- nkozyra 9y ago
  Why would investors ignore something that has enormous potential to impact their investments?
- AnimalMuppet 9y ago
  Trump has the ability to direct various federal agencies to do things that could impact Amazon in more concrete ways. He's not just a blowhard throwing tantrums...
  - mullen 9y ago
    Like what? People say this, but I have not heard one good example of this being true. Trump is not a dictator.
    - dragontamer 9y ago
      Erm, like unilaterally increasing the price of Steel by 25% in a single afternoon. https://www.usatoday.com/story/news/politics/2018/03/07/trump-sign-tariffs-25-steel-and-10-aluminum-white-house-thursday-afternoon/405294002/ https://www.usatoday.com/story/news/politics/2018/03/07/trum... Mr. Trump has the power to do this. And he did, just a few weeks ago. Mr. Trump is realizing the extent of his powers and is beginning to use the office of the Presidency with efficacy.
      - samkone 9y ago
        Efficacy?? Lol I guess time will tell.
      - djrogers 9y ago
        The tariffs did not increase the price of steel by 25%, they added a 25% tariff to imported steel. The US imports under 1/3rd of the steel we use (36M mt vs 81M mt), so the majority of our steel will have no tariffs on it. [1] http://abcnews.go.com/Business/key-facts-us-steel-aluminum-industries/story?id=53616380 http://abcnews.go.com/Business/key-facts-us-steel-aluminum-i...
        donarb 9y ago
        Except that domestic producers now have carte blanche to raise the price of their products to just below the tariffed price.
- alehul 9y ago
  The market responds to Trump's tantrums because it affects the potential of Amazon in the future. Basically, if Trump threatens to take some action against Amazon that may hurt its value as a company by 10%, and investors believe there is a 50% chance of Trump following through with this threat, the investors will (theoretically) collectively lower the price of the stock by 5%. A price on a stock market is determined wholly by future outlook, which a president's negative tweets can affect, hence why some companies with high earnings expectations in the distant future cough Tesla cough have ridiculously high price/earnings ratios on their shares.
  - dageshi 9y ago
    Nah, more like the market has run out of reasons to buy for the moment and will happily use any excuse to sell.
  - mythz 9y ago
    Only companies making profits have P/E ratios, Tesla is still losing money so its P/E doesn't dictate its share price, only its projected future growth/sales. P/E ratios don't tell the whole story, e.g. AMZN has a high P/E ratio because they aim for low profitability by reinvesting in growth, similar to Netflix who's still taking on debt to build out its inventory. When a companies growth and revenue has stagnated their P/E ratio then becomes a strong indicator for market value / share price.
  - sp527 9y ago
    The part you omitted is how the long-term outlook currently priced into a lot of tech stocks (including AMZN) is far too optimistic and not accurately discounted relative to likelihood. Current prices aren't a function of rigorous analysis so much as pie-in-the-sky projections and too much capital floating around.
    - alehul 9y ago
      The efficient-market hypothesis basically asserts that if a price weren't a function of rigorous analysis, then there would be a sizable incentive to find and correctly analyze this stock, and trade appropriately to take advantage of the inefficiency until it no longer exists. There could possibly be a more optimistic pricing in the markets if we factored in, just as a random example, that people are more timid to short rather than buy, as a short can easily result in a loss higher than the entire value of the position. An interesting read if you'd like to go down the rabbit-hole of that ideology would be anything on the concept of 'Adaptive Markets' by Andrew Lo. Rather than the common physics/maths-based approach to market behavior, it focuses on a more biological one, and thus includes these 'emotional inefficiencies' that may be present in market pricing.
- fwdpropaganda 9y ago
  Because he has a lot of power and might act on it. He barked a lot about tariffs too, and eventually actually followed through.
- pc2g4d 9y ago
  The disposition of the president toward your company/industry is, unfortunately, an important market input. A symptom of executive overreach though it may be.
- rdiddly 9y ago
  Long-term investors do that, ignoring not only various Important Pronouncements, but also the market's many short-term diaper-crappings in reaction to same.
- mistermann 9y ago
  For a reason not too dissimilar from the reason you call Trump's actions "tantrums": human emotion dominates logic.
- CamperBob2 9y ago
  Because an unhinged Twitter addict with access to nuclear weapons is bad for business? More seriously, there's a lot of uncertainty affecting the US political and economic prime movers that's not priced into the market, for reasons I don't understand. You could have knocked me over with a feather when a con man with his own private parking spot at bankruptcy court won the Presidential election and markets went up.
- TomMckenny 9y ago
  Because it's not possible to predict who is next and the market hates uncertainty. So it's not just Amazon but any potential future target that may take a hit.
hw 9y ago
Even without Trump's negative tweets, companies like AMZN are extremely overvalued and the premium is there on the expectation of future hyper growth. With the overall markets falling, investors are now taking a step back and re-evaluating their portfolio. Also, with a possible trade war scenario happening, AMZN will no doubt be impacted. Ecommerce will also suffer as a whole, especially with a lot of products sold that are being manufactured in China.
- StriverGuy 9y ago
  What are you basing this off of?
  - swarnie_ 9y ago
    PE of tech companies would be a great place to start
thrillgore 9y ago
Trump just won't shut the fuck up. Any time he goes after Amazon, its a dog whistle for the market to sink. All this trade confusion is the root cause of the matter. My money is in IRAs weighted against a diverse mixture of stable and medium-risk companies. It's one thing if Amazon is getting criticized, but if the P&Gs of the world are sinking too...
frankc 9y ago
The stock market is not "the economy". Ultimately AMZN's price will be reconciled with it's earnings. It's possible that future earnings will be affected by higher shipping costs, but if the USPS is being too generous (I have no idea) then everyone except AMZN is a winner if a better deal is negotiated.
- cma 9y ago
  > The stock market is not "the economy". No, but paper wealth has a huge effect on discretionary spending.
- candiodari 9y ago
  > Ultimately AMZN's price will be reconciled with it's earnings. I'm surprised no-one has called you out on this yet. Amazon's price to earnings multiple is currently 223.09 (after the 5% drop). Normal for companies is ~20, maybe 25. Bad companies usually run at 10 or so (usually meaning lots of debt, but no doubts about survival), Great companies run at double that, up to ~50. Amazon's price to earnings is ridiculous. Nope, Amazon's stock price is purely running on the reputation of the firm itself and of it's manager, Jeff Bezos. It is a huge exception in that regard. https://finance.yahoo.com/quote/AMZN?p=AMZN https://finance.yahoo.com/quote/AMZN?p=AMZN
brown9-2 9y ago
He basically brought down the economy Oh c’mon.

AznHisoka 9y ago

But why do investors have to respond to Trump's tantrums? Why don't they collectively just ignore him?

dragontamer 9y ago
Because Trump controls the US Postal Service, by nature of being the president. If Mr. Trump wants the USPS to screw Amazon over, he has the power to do so. Its clear that Mr. Trump doesn't care about the long-term survivability of the USPS anyway, so he certainly has the power to "weaponize" the USPS and change its terms to become anti-Amazon. On the contrary to your post: it is the JOB of investors to pay attention to the US President, as well as the powers he has... to keep your investments safe. Its your 401k retirement at risk here. Therefore, it behooves you to move your money to safer pastures if the President is making threats.
- mullen 9y ago
  > If Mr. Trump wants the USPS to screw Amazon over, he has the power to do so. Its clear that Mr. Trump doesn't care about the long-term survivability of the USPS anyway, so he certainly has the power to "weaponize" the USPS and change its terms to become anti-Amazon. No, he can't. There are laws in place to prevent the USPS from changing the price based on who is shipping. The USPS is Net Neutrality at its best.
  - dragontamer 9y ago
    > No, he can't. Uh huh. Let me get more specific then. https://www.scribd.com/document/254642175/Amazon-USPS-Sunday-Deal https://www.scribd.com/document/254642175/Amazon-USPS-Sunday... What is preventing Mr. Trump from tearing up this contract for Amazon Sunday Deliveries? Hint: absolutely nothing. Mr. Trump can destroy the USPS's revenue AND hurt Amazon at the same time if he so wished. I guess destroying the contract will take 30 days, but in any case, Mr. Trump can make "Sunday USPS deliveries" of Amazon goods incredibly more expensive in just one month. Mr. Trump may need to fire a few Post Office directors, but Mr. Trump doesn't really seem to care too much about the turnover of this organization he's running.
    - mullen 9y ago
      [I am going to respond to thrillgore and dragontamer in this post because the HackerNews software won't let me respond to both posts] > "There are laws in place" is literally dismissing anything he can do; because its clear he's gone over the law before (the travel ban), he'll do it again, and again, and again, until the law has no foundation left to stand on. And he lost on the travel ban, twice. In fact, when you look at what he has done that are against the law, he gets smacked down. He does not win on such things. > Hint: absolutely nothing. Mr. Trump can destroy the USPS's revenue AND hurt Amazon at the same time if he so wished. I guess destroying the contract will take 30 days, but in any case, Mr. Trump can make "Sunday USPS deliveries" of Amazon goods incredibly more expensive in just one month. There would be complete shitstorm if he did that since USPS makes money on the Amazon contract. Trump does not rule in a vacuum and even his shills in Congress would come down on him if Amazon packages stopped being delivered. Plus, Jeff Bezos can put messages at the start of every Amazon Prime Moive/Show asking for Amazon customers to call their Congress person to complain. Little message on Amazon.com on why there is no Sunday delivery would be a shitstorm to Congress. Trump might be the President but Jeff Bezos has millions of US voters using his website every day. I also guarantee that more people like Amazon.com than Trump.
      - dragontamer 9y ago
        > There would be complete shitstorm Erm, Trump doesn't seem to care about the number of shitstorms he causes. If anything, Trump (and his base) are HAPPY when they get shitstorms. "Drain the Swamp", "Snub the coastal elites", etc. etc. If Trump wanted to prevent shitstorms, maybe his Cabinet-level officials wouldn't leave every 3 or 4 months. Trump doesn't care about Congress or laws. He just does whatever he can do. Sure, the courts smack him down sometimes, but the power of the Executive Order means he truly can hurt Amazon (to the detriment of greater America) if he really wanted to. ---------- There are PLENTY of powers Mr. Trump can do. The Justice Department can investigate Amazon for antitrust. So can the FCC. Heck, the FCC just got rid of net neutrality (due to Mr. Trump's most recent appointee). Demonstrating the power over the Internet that Mr. Trump wields. USPS is just the most obvious way (IMO) that Mr. Trump can hurt amazon. And it seems to be the one that Mr. Trump's tweets are focusing on.
  - thrillgore 9y ago
    But the President can divert funding and fire the Postmaster General. "There are laws in place" is literally dismissing anything he can do; because its clear he's gone over the law before (the travel ban), he'll do it again, and again, and again, until the law has no foundation left to stand on.
    - leesalminen 9y ago
      My understanding is that the President does have the power to control immigration under certain circumstances (national security). Please correct me if I’ve been reading too much fake news :). Edit:: a cursory Google search seems to indicate that the President can indeed limit immigration [0]. [0] http://www.latimes.com/politics/la-na-pol-travel-ban-legal-analysis-20170206-story.html http://www.latimes.com/politics/la-na-pol-travel-ban-legal-a...
neaden 9y ago
Because they are worried he's actually going to do something? What he might do I don't think anyone could really tell you, but the possibility that he does something that hurts their business is real.
existencebox 9y ago
To make a comical point out of a depressing topic: You and I might be so wise as to ignore if, for instance, a goat started telling us it was going to come after us and steamroll our houses. Put the goat behind the wheel of a tank with a brick on the gas pedal, and I think you may start to see why there's a degree of real fear behind what otherwise would be off-kilter ranting from a surprisingly loquacious ungulate.
hueving 9y ago
Despite his constant hyperbole, left-leaning folks seem to take everything he says very seriously and react emotionally to it.
- dragontamer 9y ago
  https://twitter.com/realDonaldTrump/status/980063581592047617 https://twitter.com/realDonaldTrump/status/98006358159204761... Mr. Trump is directly attacking Amazon, and is saying that he wishes to change USPS rules to extract more money from the Amazon deal. Its not "emotional" to sell Amazon stock after this tweet. Its common sense. Mr. Trump clearly has the power to hurt Amazon, and he's threatening them. So as an investor, why SHOULDN'T I sell Amazon in light of this news?
  - kolpa 9y ago
    You shouldn't "sell" on this or any news, you should lower your buy/sell price, which you should always have pending.
- nkozyra 9y ago
  This doesn't add anything to the conversation. The market is responding to things that have the potential to impact what they're investing in. It's not a political or even emotional response.
  - hueving 9y ago
    Panic selling is always an emotional response. There is no forward earnings analysis going on here, just "get the fuck out of the market" selling.
ironjunkie 9y ago
Because it's game theory. It only works if everyone's ignore him. But as soon as one person doesn't ignore him and start "panick selling", everyone else loses.
- dragontamer 9y ago
  > It only works if everyone's ignore him. The President is the leader of the USA. You cannot ignore him. When Trump / Jeff Sessions announced that they were going after marijuana, marijuana stocks fell. Trump announces tariffs on Aluminum, users of aluminum fell (ie: Ford). Making Aluminum and Steel 25% more expensive in the US has long-term effects you cannot ignore. You CANNOT avoid Mr. Trump or his tariffs. You can't dig your head into the ground and "ignore him". When Mr. Trump decides to do something, it has cascading effects on the rest of America. Mr. Trump controls the FBI, the DEA, the FTC, the FCC, the USPS. Directly. Mr. Trump can add and remove policies from these great agencies without even asking for anything from Congress. Pure, unilateral power of the executive order. You CANNOT ignore this power. Its how America works.
  - r00fus 9y ago
    So did this not happen during the Obama administrations because Obama didn't have verbal diarrhea?
    - dragontamer 9y ago
      It happened under the Obama administration. In fact, Mr. Obama demonstrated how it could be a weapon for good. Mr. Obama encouraged taxes to benefit solar-manufacturers and electric car companies. This caused those stocks to go up, and investments into green-energy to flourish. Sure, there were some failures (see Solyndra), but I think it was overall a net-benefit to the USA. We're now manufacturing advanced Solar Panels that are better than a lot of other countries (although China is still manufacturing them cheaper...). And Tesla greatly benefited from the tax-break on electric cars. That's the sort of thing a President is SUPPOSED to do: use his powers to lead the nation. Trump is using his powers to turn us against each other.
nkozyra 9y ago
Why would investors ignore something that has enormous potential to impact their investments?
AnimalMuppet 9y ago
Trump has the ability to direct various federal agencies to do things that could impact Amazon in more concrete ways. He's not just a blowhard throwing tantrums...
- mullen 9y ago
  Like what? People say this, but I have not heard one good example of this being true. Trump is not a dictator.
  - dragontamer 9y ago
    Erm, like unilaterally increasing the price of Steel by 25% in a single afternoon. https://www.usatoday.com/story/news/politics/2018/03/07/trump-sign-tariffs-25-steel-and-10-aluminum-white-house-thursday-afternoon/405294002/ https://www.usatoday.com/story/news/politics/2018/03/07/trum... Mr. Trump has the power to do this. And he did, just a few weeks ago. Mr. Trump is realizing the extent of his powers and is beginning to use the office of the Presidency with efficacy.
    - samkone 9y ago
      Efficacy?? Lol I guess time will tell.
    - djrogers 9y ago
      The tariffs did not increase the price of steel by 25%, they added a 25% tariff to imported steel. The US imports under 1/3rd of the steel we use (36M mt vs 81M mt), so the majority of our steel will have no tariffs on it. [1] http://abcnews.go.com/Business/key-facts-us-steel-aluminum-industries/story?id=53616380 http://abcnews.go.com/Business/key-facts-us-steel-aluminum-i...
      - donarb 9y ago
        Except that domestic producers now have carte blanche to raise the price of their products to just below the tariffed price.
alehul 9y ago
The market responds to Trump's tantrums because it affects the potential of Amazon in the future. Basically, if Trump threatens to take some action against Amazon that may hurt its value as a company by 10%, and investors believe there is a 50% chance of Trump following through with this threat, the investors will (theoretically) collectively lower the price of the stock by 5%. A price on a stock market is determined wholly by future outlook, which a president's negative tweets can affect, hence why some companies with high earnings expectations in the distant future cough Tesla cough have ridiculously high price/earnings ratios on their shares.
- dageshi 9y ago
  Nah, more like the market has run out of reasons to buy for the moment and will happily use any excuse to sell.
- mythz 9y ago
  Only companies making profits have P/E ratios, Tesla is still losing money so its P/E doesn't dictate its share price, only its projected future growth/sales. P/E ratios don't tell the whole story, e.g. AMZN has a high P/E ratio because they aim for low profitability by reinvesting in growth, similar to Netflix who's still taking on debt to build out its inventory. When a companies growth and revenue has stagnated their P/E ratio then becomes a strong indicator for market value / share price.
- sp527 9y ago
  The part you omitted is how the long-term outlook currently priced into a lot of tech stocks (including AMZN) is far too optimistic and not accurately discounted relative to likelihood. Current prices aren't a function of rigorous analysis so much as pie-in-the-sky projections and too much capital floating around.
  - alehul 9y ago
    The efficient-market hypothesis basically asserts that if a price weren't a function of rigorous analysis, then there would be a sizable incentive to find and correctly analyze this stock, and trade appropriately to take advantage of the inefficiency until it no longer exists. There could possibly be a more optimistic pricing in the markets if we factored in, just as a random example, that people are more timid to short rather than buy, as a short can easily result in a loss higher than the entire value of the position. An interesting read if you'd like to go down the rabbit-hole of that ideology would be anything on the concept of 'Adaptive Markets' by Andrew Lo. Rather than the common physics/maths-based approach to market behavior, it focuses on a more biological one, and thus includes these 'emotional inefficiencies' that may be present in market pricing.
fwdpropaganda 9y ago
Because he has a lot of power and might act on it. He barked a lot about tariffs too, and eventually actually followed through.
pc2g4d 9y ago
The disposition of the president toward your company/industry is, unfortunately, an important market input. A symptom of executive overreach though it may be.
rdiddly 9y ago
Long-term investors do that, ignoring not only various Important Pronouncements, but also the market's many short-term diaper-crappings in reaction to same.
mistermann 9y ago
For a reason not too dissimilar from the reason you call Trump's actions "tantrums": human emotion dominates logic.
CamperBob2 9y ago
Because an unhinged Twitter addict with access to nuclear weapons is bad for business? More seriously, there's a lot of uncertainty affecting the US political and economic prime movers that's not priced into the market, for reasons I don't understand. You could have knocked me over with a feather when a con man with his own private parking spot at bankruptcy court won the Presidential election and markets went up.
TomMckenny 9y ago
Because it's not possible to predict who is next and the market hates uncertainty. So it's not just Amazon but any potential future target that may take a hit.

hw 9y ago

Even without Trump's negative tweets, companies like AMZN are extremely overvalued and the premium is there on the expectation of future hyper growth. With the overall markets falling, investors are now taking a step back and re-evaluating their portfolio. Also, with a possible trade war scenario happening, AMZN will no doubt be impacted. Ecommerce will also suffer as a whole, especially with a lot of products sold that are being manufactured in China.

StriverGuy 9y ago
What are you basing this off of?
- swarnie_ 9y ago
  PE of tech companies would be a great place to start

thrillgore 9y ago

Trump just won't shut the fuck up. Any time he goes after Amazon, its a dog whistle for the market to sink. All this trade confusion is the root cause of the matter. My money is in IRAs weighted against a diverse mixture of stable and medium-risk companies. It's one thing if Amazon is getting criticized, but if the P&Gs of the world are sinking too...

frankc 9y ago

The stock market is not "the economy". Ultimately AMZN's price will be reconciled with it's earnings. It's possible that future earnings will be affected by higher shipping costs, but if the USPS is being too generous (I have no idea) then everyone except AMZN is a winner if a better deal is negotiated.

cma 9y ago
> The stock market is not "the economy". No, but paper wealth has a huge effect on discretionary spending.
candiodari 9y ago
> Ultimately AMZN's price will be reconciled with it's earnings. I'm surprised no-one has called you out on this yet. Amazon's price to earnings multiple is currently 223.09 (after the 5% drop). Normal for companies is ~20, maybe 25. Bad companies usually run at 10 or so (usually meaning lots of debt, but no doubts about survival), Great companies run at double that, up to ~50. Amazon's price to earnings is ridiculous. Nope, Amazon's stock price is purely running on the reputation of the firm itself and of it's manager, Jeff Bezos. It is a huge exception in that regard. https://finance.yahoo.com/quote/AMZN?p=AMZN https://finance.yahoo.com/quote/AMZN?p=AMZN

brown9-2 9y ago

He basically brought down the economy Oh c’mon.