Many Americans voted for President Donald Trump for the sole intention of strengthening the economy, but the current state of the stock market is not reflecting those intentions. The tariffs placed on the United State’s closest neighbors and allies are going to have a much larger effect than a couple of days of a crashed stock market.
“The markets right now are extremely good,” Trump declined to admit that his tariffs were bad for the American economy, so he did what he does best and denied. Trump placed tariffs on more than 180 countries and territories, China being the most affected. Originally, he had placed a 104% tariff on Chinese goods, but once again raised it to 125% yesterday afternoon.
However, the most recent development in this situation is how President Trump blinked first. He announced a 90-day postponing of the tariffs for every other country other than China. The stock market, hearing this news, skyrocketed once more. For someone who was painted as a master of business, it is surprising that he backed out first.
This postponing of tariffs has allowed the stock market to recover from the 3 days of catastrophe, but the damage has been done. Dave Portnoy, the owner of Barstool Sports and avid Trump supporter, lost 7 million dollars in stocks and crypto on Trumps’ “Liberation Day”. Portnoy claims that he’s willing to give the president time to recover from the crash, but would not be against voting Democratic if the economy is not fixed by midterms.
While midterms are a long way away, it is important for the American people to realize what the President is trying to do. Trump knows that the crash has already lost him support of most who were affected by the tariffs. Because of this, he knew he had to back off and “fix” the stock market simply so he could have the advantage in the midterm elections. Trump, while his actions and words may seem like it, is not dumb. He knows that midterm elections could cause a massive swing in the representation of MAGA and Republicans in government. Trump is aware that the economy cannot under any circumstances be poor by the time of midterms, or else his supporters will not get elected or re-elected.
In my opinion, that is why he backed off of the tariffs last afternoon. He knows that he is starting to lose the support that he had in the beginning of his term, and he can’t get his supporters elected if the economy continues to crash. The only way that Trump supporters and MAGA will start to turn a cheek to Trump is if they start to feel the emptiness of their wallet. Now, because of the tariffs, they are starting to feel it and Trump knows it.
One of these supporters is well-known, but not well liked: Elon Musk. Musk lost over 10,000,000,000 dollars due to the crash of Tesla sales just this past week. Not only did Tesla stock crash, but Musk has been consistently losing money from the decline of Teslas being purchased. More than 50% of all Tesla dealerships have closed, and Musk has lost a total of 140,000,000,000 dollars. While I doubt that Musk will ever stray from his support of Trump, I could see the American people losing their faith in the wealthy and our President.
The plan (or concepts of a plan) that Trump has for the tariffs is unknown to many, possibly even to Trump himself. So, be smart when making purchases and when investing in the stock market for the foreseeable future. How easy it was for Trump to back off the tariffs is just how easy it would be for him to change his mind or even increase them.