America Last?!

The U.S. stock market had its worst day since 2020 on Thursday, as investors were trying to digest President Trump’s sweeping tariff announcements from the day before. The surprisingly high additional tariffs – a 10 percent baseline tariff on all imports plus significantly higher rates for countries considered “bad actors” in trade – sent shockwaves around the world, as they threaten to upend the status quo of the global economy in one fell swoop.

Global markets plummeted in the wake of the announcement, as the repercussions of the U.S. turning back time to the early 1900s will be felt everywhere from China to Europe - nowhere more so than in the United States, though. Unsurprisingly, the U.S. stock market was most heavily affected by the “Liberation Day” selloff, as the S&P 500 fell 4.7 percent, the tech-heavy Nasdaq plummeted 6 percent and the Dow Jones lost 4 percent, wiping out $2.5 trillion in market capitalization of U.S.-listed stocks. The so-called Magnificent 7 alone shed more than $800 billion in market cap on Thursday on what has been the worst day for U.S. stocks since the Covid-19 pandemic rattled markets in early 2020.

For now, Trump’s “America First” policies have put the country last - at least in terms of stock market performance. The S&P 500 has dropped 10 percent since Inauguration Day, as the Trump administration’s policies are widely feared to drive up inflation, erode consumer confidence and ultimately cause a recession. When asked about the stock market fallout and the warnings of economists, administration officials keep repeating that Trump’s policies will eventually make America great again and that every American will profit in the long term. People tend to be rather impatient when they see their retirement savings melt like ice cream in the sun, however, which is why it will be interesting to see if and when some of Trump’s supporters will sour on the president and his protectionist policies.