US President Donald Trump’s decision to impose tariffs on Canada and Mexico has triggered a global stock market crash, with the Dow Jones Industrial Average plummeting 670 points or 1.5% on Tuesday.
Contrary to initial expectations that Wall Street would rein in Trump’s worst instincts, his aggressive tariff policy appears to be having the opposite effect. Several analysts had predicted that investors would sell their stocks as soon as Trump’s first term began, but so far, that hasn’t happened.
In fact, since Trump took office, the S&P 500 has fallen nearly 4%, with the index erasing all its gains since his re-election. The Nasdaq, which had been fueled by investor hopes for an AI-powered future, has tumbled 7% and is now down nearly as much.
Industry experts point to a lack of evidence that Trump’s actions are having the desired effect on the stock market. “I think he tried to implement the Trump put in cryptos, and it didn’t have a huge lasting effect,” said Sosnick. The theory behind the “Trump put” was that Trump would reverse course if his policies led to market downturns.
However, Trump has continued to double down on tariffs despite acknowledging their unpopularity and potential to cause economic pain. Canadian Prime Minister Justin Trudeau described the move as a “dumb thing to do,” echoing Wall Street Journal editorial that reads: “Trump Takes the Dumbest Tariff Plunge.”
Some analysts now question whether there is a market threshold that would prompt Trump to change course. Even if such a level exists, it’s unclear whether Trump could simply snap his fingers and turn investor sentiment on a dime.
As markets continue to reel from Trump’s tariff policy, investors are pointing fingers at him for blaming others for the economic downturn. When a plane crashed shortly after Trump took office, he blamed it on DEI and his predecessors. Similarly, when January inflation reports showed consumer prices rising more than expected, Trump attributed it to President Biden.
The economic blame game is being played out in the White House, with Treasury Secretary Scott Bessent saying that everything that’s happening now is “cleaning up the Biden administration’s mess.” This narrative has become a hallmark of Trump’s response to criticism.
Source: https://edition.cnn.com/2025/03/05/business/wall-street-trump-tariffs-nightcap/index.html