As it turned out, the only thing Liberation Day was actually liberating anyone from was their money. In the wake of President Trump’s imposition of a massive round of tariffs on America’s trading partners the stock market has been in freefall. For the moment Trump is ignoring that. But he won’t be able to forever – a bear market is too damning a verdict on his presidency.
You can’t ‘make America great again’ in a bear market
Investors, to put it mildly, took one look at the latest round of tariffs, and dumped equities as fast as possible. In the wake of the tariffs announcement, the Dow Jones Industrial Average plunged 1,679 points, or 4 per cent while the S&P 500 sank 274 points, or 4.8 per cent, its biggest one-day drop since the Covid collapse in 2020. More than $2 trillion was wiped off the value of the US equity markets.
It is not hard to understand why.
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