Donald Trump is a lucky person.

His social media website goes public, and he gains a bonanza worth billions.

He is indicted for crimes and with each new charge, he seems to become more popular.

He holds a campaign fundraiser and rakes in tens of millions of dollars from billionaires, even though some of that money is likely to be siphoned off to pay his legal expenses.

He is generally thought to be leading President Joe Biden in his effort to regain the White House.

His popularity is often explained as showing that his core supporters have formed a cult, and, like any cultists, they blindly support their leader.


But the recent explosion in the value of his social media company has prompted a closer look at why he has progressed so far.

The company has suffered a one-year loss of $58 million on total revenues of $4.1million (not billion). The company might be worth about $41 million in a normal market. With Trump’s involvement, its market value is about $5 billion.

One explanation is that the more investments get away from real value the more valuable they become. Many are “derivatives” — investments that are essentially bets on other investments or simply on other bets. They are a form of gambling. That may explain the meteoric rise of Bitcoin, a crypto-currency that is more crypto than currency.

But that would not explain why some of the wealthiest people still line up to back Trump. One suggestion is that their support and that of other potential Trump voters is a matter of what is called “motivated reasoning.”

This theory says that people allow their biases to affect how they see new information. They favor news that lines up with their beliefs and reject evidence that disagrees. Fact checking simply doesn’t matter. This analysis has been around for a long time, and it could boost Trump’s success. And some progressives also think this way.

It happens in a casino when a person wins a bet and then keeps on making losing but hopeful bets. In this case, something inevitably happens, and this is not a theory. It’s called “gambler’s ruin.” When you bet long enough against the house with its endless resources, you lose.


The focus must not be what Trump’ social media investment will turn out to really be worth or if his trials, win or lose, are political and should be ignored, but when the gamble fails. And the question is not only if Trump is the gambler, but if the U.S. would also be if he’s president.

Biden gets little support from backers engaged in motivated reasoning. Trump’s advantage may be a key element in his lead over the president, leaving Biden to argue that his record should gain him the political credit he needs to win.

The biggest issue may be the economy, because many voters appear to believe they are suffering from difficult times as their incomes increase more slowly than their expenses. Biden cannot convince them that the economy is in good shape and getting better.

That has to be frustrating because of motivated reasoning based on the belief the economy is in bad shape and is still wobbling. The effects of the 2008 financial crisis and the Covid pandemic have created beliefs that stand in the way of the facts. In reality, inflation is down, wages are rising faster than prices, unemployment is low and interest rates are at average levels.

Interest rates may not be interesting, but they are probably the key economic factor that can improve Biden’s chances. In fighting past crises, the Federal Reserve kept rates at close to zero. Then, the Fed raised them to block inflation resulting from a hot economy.

The central bank’s policies have worked. The effects on employment and wages have been positive, though prices had to increase but that growth has been cut in half. In effect, after about 16 years of crisis economics in which people were sent negative signals by the Treasury Department and the Fed, the economy looks like it is settling back to normal.

The Fed is expected to begin lowering interest rates with a couple of cuts possible this year. It operates entirely independently of the rest of the government, but Trump has already suggested that any rate reductions will be intended to help Biden. While the president has nothing to do with Fed policy, Trump will be giving him credit for taking popular action.

The biggest issue may be continued uncertainty about the future. Will either Biden or Trump be able to provide the sense of stability missing since the financial crisis? Trump preaches fear that matters are growing worse, and he gains support. Biden struggles to break through the barrier of the public’s own worried expectations.

Gordon L. Weil formerly wrote for the Washington Post and other newspapers, served on the U.S. Senate and EU staffs, headed Maine state agencies and was a Harpswell selectman. 

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