The stock market likes stability and President Trump is anything but with his on-and-off tariff threats and other erratic moves and investors are responding.
Yesterday capped an acute market sell-off, with the Nasdaq having its worst day in more than two years and most U.S. exchanges erasing the gains they’d made since the November election, sparking significant fears of a coming recession, just weeks into the Trump slash-and-burn presidency.
Are there any level heads, like the tech billionaires who paid homage to him in January, who can step in and try to get Trump to calm down?
It was clear that Trump would be bad for the economy for the simple reason that uncertainty, regulatory chaos, tariffs, mass layoffs and the dissolution of the administrative state would obviously kneecap the relatively robust economy that Joe Biden had left.
Any type of business requires predictability, the ability to know roughly how much things might cost next month, or next week, whether contracts will be worth the paper they’re printed on and how the government is going to act.
A situation where the would-be king and his unelected billionaire patron and effective prime minister can rule by fiat, punishing disfavored companies and industries while mass-firing a huge federal workforce and instituting and pausing, instituting and pausing tariffs with our largest trading partners is tailor-made to crater the economy.
This is a terrible situation at any time, but it’s particularly bewildering for many voters coming from a president whose core overarching policy message was that he would bring prices down and bolster Americans’ finances. We hope these voters aren’t looking at their 401(k)s as they plummet, though a market that has merely lost its gains since the election still has plenty of ground left to lose.
We’re bearing down on a Friday deadline for government funding, and Trump’s lapdog House Speaker Mike Johnson wants to sail through a purely partisan funding bill that faces long odds in the Senate.
Does Trump really want to pile on, let the government go into shutdown as stocks keep sliding? Even his TV pals at Fox News are getting hot under the collar watching the lines go down. Given the chance to reassure the U.S. public during a softball interview with Fox Business host Maria Bartiromo this weekend, Trump declined to make any predictions about a potential coming recession and said it would be “a period of transition.”
As much as Bartiromo and her fellow Trump cheerleaders are setting the stage to try to lay such a recession at the feet of the prior Biden administration, we don’t think this is going to work. Despite a rough patch of inflation during his White House term, Biden left office with a stable economy, and will have been out of office some two months by the time the economy really starts nosediving.
We’ll remind the incumbent president that his diehard follower base is just a fraction of the electorate that put him in office; a huge chunk of his voters were relatively tuned out people who bought the idea that the Trump was a successful business genius who would deliver a stellar economy. Change course, or they’ll never forget the president who torpedoed the economy in record speed.