Photo Attribution: Gage Skidmore
Whether Donald Trump, the US President, is making any progress in his campaign to Make America Great Again is difficult to gauge. However, according to Goldman Sachs, there is one area where Trump is having a huge impact: market volatility.
Analysts at the investment bank said that in a year when volatility appeared to be stubbornly flat, rare spikes happened around the missile launches of North Korea.
However, instead of corresponding to the actual military activity, it appeared that the peaks in the Volatility Index (Vix) of the Chicago Board of Options were more closely related to the consequent tweets of President Trump.
In fact, Goldman discovered that even if Trump merely mentioned North Korea in a tweet even if there had been no recent missile test, markets exhibited signs of alarm. Test which did not evoke an impact from the president, on the other had, seemed to cause little concern.
“Tweets matter, testing does not. Indeed, from a statistical perspective, testing does not appear to matter at all unless President Trump tweets about it,” stated a note on the research written by Charles Himmelberg and James Weldon.
Never mind artificial intelligence – it seems that social media is one step closer to controlling our lives.