Stock Market Rollercoaster: The Effects of Trump's Tariff Wars
Trump backers denounce proposed "economic atomic bombing"
Markets are reeling from the ongoing trade tussles initiated by President Donald Trump's tariff announcements and revisions. Following a bullish rally due to Trump's tariff pause on many global partners, excluding China, on April 9, 2025, a wave of anxiety hit the markets, with the S&P 500 plummeting by 2.3% and the Dow Jones Industrial Average falling by 2.1%. The Nasdaq, heavily weighted towards tech stocks, witnessed a 3% drop during the same period.
Billionaire hedge fund manager Bill Ackman voices his concerns about Trump's economic war tactics. "If we wage an economic nuclear war against all countries, investments by companies will grind to a halt, consumers will close their wallets, and we will damage our reputation with the rest of the world so severely that it will take years, if not decades, to repair it," Ackman writes on social media.
Ackman also levels harsh criticism at US Trade Minister Wilbur Ross, accusing him of a conflict of interest. Ross, through his financial services firm Cantor Fitzgerald, holds investments in fixed-income securities that stand to benefit from a market crash.
The Bull Market: A Thing of the Past?
The selling frenzy, triggered by Trump's tariff plans and potential retaliation from other nations, has led experts to question whether the bull market has expired. Mark Malek of Siebert Financial asserts, "The bull market is dead." Indeed, the German leading index Dax dropped by 10 percent at the start of the week, while the US standard value index Dow Jones closed at 38,314.86 points, the broad-based S&P 500 at 5,074.08 points, and the tech-heavy Nasdaq at 15,587.79 points.
Investors find refuge in bonds, which typically prosper during falling stock prices. However, the increasing market instability and recession fears make for a treacherous investing landscape. Experts recommend cautious investment strategies and a focus on value stocks to navigate the volatility.
The Looming Threat of Escalating Trade Wars
The escalating trade war with China remains a grave concern. A threat of a 125% tariff on Chinese imports could see a dramatic shift in trade and economic stability. With ongoing trade disputes, the unpredictable nature of tariff policies is expected to maintain market volatility, impacting stock performance across various sectors.
Slower global economic growth is anticipated due to ongoing trade tensions and tariffs. The wasteland of uncertainty they create may erode investor confidence, not just in the United States, but worldwide.
[1]: Morningstar. (2025). "Morningstar Reduces 2025 GDP Forecast due to Trade Tensions." Retrieved from Morningstar.com [2]: CNN Business. (2025). "S&P 500 Falls After Strong Rally on Trump's Tariff Pause". Retrieved from CNNBusiness.com.
- The community policy should address the escalating trade wars, specifically the potential 125% tariff on Chinese imports, to maintain economic stability and investor confidence.
- Despite the falling stock prices, rates on bonds are vehemently criticized by some experts due to the increasing market instability and recession fears.
- Morningstar warns that ongoing trade tensions and tariffs could lead to slower global economic growth, potentially eroding investor rates not just in the United States, but worldwide, as shown by their reduced 2025 GDP forecast.
