War of words already resulting in consequences

Friday, August 11, 2017

“Sticks and stones may break my bones, but words can never harm me.”

Well, we’ll see.

President Trump is the first president to prefer direct communication with the world through Twitter, bypassing established media and even his own communications staff.

“Military solutions are now fully in place, locked and loaded, should North Korea act unwisely. Hopefully, Kim Jong Un will find another path!” he tweeted Thursday.

He declined to walk back his earlier statement that Kim Jong Un would face “fire and fury” should he attack the U.S. or its allies, saying, if anything, his statement should have been stronger.

The conservative Wall Street Journal, a stablemate of Rupert Murdoch’s Fox News, called the president “his own worst political enemy” and said he was damaging his presidency “with his seemingly endless stream of exaggerations, evidence-free accusations, implausible denials and other falsehoods.”

In truth, Trump’s threats against North Korea reflect a longstanding U.S. policy that any nuclear attack would be met with total destruction, a policy that extends back at least until the Eisenhower administration.

And, lest Congress gloat about Trump’s job approval rating, 37 percent, the most recent CNN poll, conducted by SSRS, showed that nearly 70 percent of Americans disapprove of Congress’ performance.

Even Republican voters have lost confidence in the GOP majority, their approval rating dropping from 75 percent in January to 39 percent now.

Democrats fare better, half of voters approving their party leadership’s performance.

While some sort of military conflict is a possibility, the “war of words” is already making itself felt in our stock market portfolios.

A measurement of fear and volatility on Wall Street, jumped about 44 percent on Thursday.

The CBOE Volatility Index climbed from 4.61 percent to 16.04 percent, the highest it's been since Election Day Nov. 8, 2016, but still below its historical average of about 20 percent.

The Dow Jones Industrial Average dropped nearly 1 percent Thursday, about 200 points, but had recovered about 34 points by the time this was written this morning.

It’s clear words do have meaning, but like any commodity, an abundant supply lowers their value.

Let’s hope current war of words doesn’t escalate into something far worse.

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