‘I hope he’s right’: Markets plummet amid tariff concerns — yet Trump remains unyielding
On Thursday morning, Americans reacted with shock as they observed significant declines in their 401(k) accounts following the market opening.
TroibNews 
President Donald Trump characterized the U.S. as a patient recovering from successful surgery, yet this analogy did little to alter the perspectives of businesses, markets, and millions of Americans who felt the country is in distress.
As markets opened, Americans witnessed their 401(k)s plummet, with the Dow experiencing a nearly 1,700-point drop and the S&P 500 losing 4.8 percent by the end of Thursday, marking the worst single-day declines since the early stages of the Covid-19 pandemic. Stellantis announced plans to lay off 900 U.S. workers at five domestic facilities while halting manufacturing at two plants in Canada and Mexico. Additionally, defense and energy industry representatives expressed private concerns that tariffs would take an extended period to revitalize domestic manufacturing of essential components currently produced abroad.
Despite Republicans accommodating the president on various issues over the past two months, Senator Chuck Grassley took steps on Thursday to reassert congressional authority over tariffs. Together with Senator Maria Cantwell, Grassley introduced legislation requiring the president to report to Congress on any unilateral moves regarding tariffs.
Senator Rand Paul, one of the Senate’s fiercest critics of tariffs, termed the stock market decline “a huge loss.” He remarked, “That's not just me saying tariffs don't work. That's millions and millions of people buying and selling stocks that are very, very concerned that tariffs are going to cause the economy to go in the wrong direction.”
Other Republicans struggled to defend Trump's new tariffs enthusiastically. Senator Ron Johnson noted, "I hope he is right. I hope the naysayers are wrong. I don’t know."
The White House remained resolute, repeatedly asserting that the trade barriers would benefit the U.S. economy in the long term. Trump told reporters on Thursday that he believed his tariffs were going “very well” and predicted “the markets are going to boom,” insisting that other countries had “taken advantage of us for many, many years.”
Top administration officials, including Vice President JD Vance, Commerce Secretary Howard Lutnick, and White House press secretary Karoline Leavitt, appeared on television Thursday morning before the market opened, assuring Americans that everything was fine and urging trust in the president. “We are fighting as quickly as we can to fix what was left to us,” Vance said on Fox & Friends, adding, “But it’s not going to happen immediately.”
There was a noticeable inconsistency in the White House’s communication regarding the president's willingness to negotiate with trading partners. Administration officials, Congress members, and even Trump’s son provided conflicting indications about potential negotiations to ease some tariffs. A White House official described the tariff policy as “not a negotiation, it’s a national emergency,” a sentiment that Lutnick echoed during a Thursday interview with CNN, stating, “I don’t think there’s any chance … that President Trump is going to back off his tariffs. This is the reordering of global trade.”
In contrast, Eric Trump implied in a post on X Thursday morning that his father might be open to negotiations and urged countries to come to the table. President Trump seemed to reinforce this suggestion, stating, “The rest of the world wants to see: Is there any way they can make a deal?”
A lobbyist close to the administration, speaking anonymously about internal discussions, revealed that the White House was firm in its stance against exemptions during initial talks but indicated there might be “more sympathetic” considerations for later exclusions for products not produced or easily available in the U.S. “We went in there and just tried to plead our case,” the lobbyist remarked. “Some of them, obviously, are a little more subject to reason, and some of these are a little more of a stretch.”
While Trump administration officials acknowledged the expectation of increased prices due to tariffs, they did not provide a timeline for how long consumers would endure this burden. Agriculture Secretary Brooke Rollins stated outside the White House that there “will be a short time of uncertainty, and then we'll move back to the prosperity that this president has envisioned.”
However, economists and industry leaders have expressed skepticism about this prediction, cautioning that a recession and rising prices are unlikely to usher in a new era of economic prosperity. According to two energy industry officials who spoke anonymously about private conversations, the White House has been urging lobbyists to refrain from publicly criticizing the tariffs and to maintain a positive tone.
Many top economists have been baffled by the specifics of the tariff plan, even after weeks of preparation. This confusion is particularly evident regarding smaller countries and territories that engage in minimal trade with the U.S. “This is basically gibberish,” stated Ed Gresser, a former official in the Office of the U.S. Trade Representative now with the Progressive Policy Institute. He added, “What they’re doing is sort of saying that this is a reciprocity policy that’s based on foreign trade barriers and so forth, but actually has nothing to do with that at all.”
Gresser explained that the administration's levy application relied on a mathematical formula derived from export figures and trade deficits, which he characterized as “really divorced from economic analysis.” Among those unfairly affected by the new tariffs are Lesotho, which received a staggering 50 percent tariff despite its minor trade imbalance, as well as other territories with negligible trade with the U.S.
The high tariffs could severely impact small countries. Lesotho, which has one of the highest HIV rates globally, relies on the clothing factories targeted by these tariffs for access to HIV medicines. “This could have really tragic implications,” Gresser remarked.
Countries such as Vietnam, Israel, and India have already made trade concessions to avoid new tariffs. For example, Vietnam announced plans to reduce tariffs on numerous products, including cars and various food items, only for the U.S. to impose a 46 percent reciprocal tariff regardless.
Experts suggest that smaller and poorer countries may find it more challenging to negotiate with the administration, as their limited trade significance puts them at the back of the line when it comes to deal-making.
The policy also underscores contradictions surrounding U.S. security alliances. The list of countries subject to tariffs includes Ukraine but omits Russia and Belarus. Treasury Secretary Scott Bessent defended these exclusions on Fox News by citing U.S. sanctions against Russia and Belarus due to the Ukraine conflict, despite Census Bureau data indicating that the U.S. imported $3 billion worth of goods from Russia last year and $20 million from Belarus.
Many economists believe the tariff rates imposed on most countries do not accurately reflect the trade barriers faced by U.S. goods and services. Despite attempts by White House officials to present a complex methodology, economists quickly pointed out that the rates essentially boil down to a calculation of each country's trade deficit divided by its imports.
"The vibe on Wall Street right now is a bit of chaos," admitted a Wall Street strategist who spoke anonymously. “This was a botched and child-like formula used to enforce something with massive implications." While many on Wall Street support Trump's objectives of increasing domestic production and holding trading partners to account, they express concerns about the methods and speed of his approach. "Every CEO in the industry is having a Maalox moment," stated Gary Shapiro, CEO of the Consumer Technology Association.
Trump's announcement aligns closely with his campaign promises, according to Unlimited Funds CEO Bob Elliott, who described the policies as “a f***ing wrecking ball” in a recent research note. He cautioned that further market losses might be necessary before a policy shift occurs and that it would take months to evaluate the broader economic impacts of the current changes.
In the meantime, confusion reigns. "This is not an economy that was in the hospital or suddenly in the intensive care," asserted Mohamed El-Erian, the chief economic adviser at Allianz. "This is an economy that was out of the hospital and was walking briskly."
Alejandro Jose Martinez for TROIB News
As markets opened, Americans witnessed their 401(k)s plummet, with the Dow experiencing a nearly 1,700-point drop and the S&P 500 losing 4.8 percent by the end of Thursday, marking the worst single-day declines since the early stages of the Covid-19 pandemic. Stellantis announced plans to lay off 900 U.S. workers at five domestic facilities while halting manufacturing at two plants in Canada and Mexico. Additionally, defense and energy industry representatives expressed private concerns that tariffs would take an extended period to revitalize domestic manufacturing of essential components currently produced abroad.
Despite Republicans accommodating the president on various issues over the past two months, Senator Chuck Grassley took steps on Thursday to reassert congressional authority over tariffs. Together with Senator Maria Cantwell, Grassley introduced legislation requiring the president to report to Congress on any unilateral moves regarding tariffs.
Senator Rand Paul, one of the Senate’s fiercest critics of tariffs, termed the stock market decline “a huge loss.” He remarked, “That's not just me saying tariffs don't work. That's millions and millions of people buying and selling stocks that are very, very concerned that tariffs are going to cause the economy to go in the wrong direction.”
Other Republicans struggled to defend Trump's new tariffs enthusiastically. Senator Ron Johnson noted, "I hope he is right. I hope the naysayers are wrong. I don’t know."
The White House remained resolute, repeatedly asserting that the trade barriers would benefit the U.S. economy in the long term. Trump told reporters on Thursday that he believed his tariffs were going “very well” and predicted “the markets are going to boom,” insisting that other countries had “taken advantage of us for many, many years.”
Top administration officials, including Vice President JD Vance, Commerce Secretary Howard Lutnick, and White House press secretary Karoline Leavitt, appeared on television Thursday morning before the market opened, assuring Americans that everything was fine and urging trust in the president. “We are fighting as quickly as we can to fix what was left to us,” Vance said on Fox & Friends, adding, “But it’s not going to happen immediately.”
There was a noticeable inconsistency in the White House’s communication regarding the president's willingness to negotiate with trading partners. Administration officials, Congress members, and even Trump’s son provided conflicting indications about potential negotiations to ease some tariffs. A White House official described the tariff policy as “not a negotiation, it’s a national emergency,” a sentiment that Lutnick echoed during a Thursday interview with CNN, stating, “I don’t think there’s any chance … that President Trump is going to back off his tariffs. This is the reordering of global trade.”
In contrast, Eric Trump implied in a post on X Thursday morning that his father might be open to negotiations and urged countries to come to the table. President Trump seemed to reinforce this suggestion, stating, “The rest of the world wants to see: Is there any way they can make a deal?”
A lobbyist close to the administration, speaking anonymously about internal discussions, revealed that the White House was firm in its stance against exemptions during initial talks but indicated there might be “more sympathetic” considerations for later exclusions for products not produced or easily available in the U.S. “We went in there and just tried to plead our case,” the lobbyist remarked. “Some of them, obviously, are a little more subject to reason, and some of these are a little more of a stretch.”
While Trump administration officials acknowledged the expectation of increased prices due to tariffs, they did not provide a timeline for how long consumers would endure this burden. Agriculture Secretary Brooke Rollins stated outside the White House that there “will be a short time of uncertainty, and then we'll move back to the prosperity that this president has envisioned.”
However, economists and industry leaders have expressed skepticism about this prediction, cautioning that a recession and rising prices are unlikely to usher in a new era of economic prosperity. According to two energy industry officials who spoke anonymously about private conversations, the White House has been urging lobbyists to refrain from publicly criticizing the tariffs and to maintain a positive tone.
Many top economists have been baffled by the specifics of the tariff plan, even after weeks of preparation. This confusion is particularly evident regarding smaller countries and territories that engage in minimal trade with the U.S. “This is basically gibberish,” stated Ed Gresser, a former official in the Office of the U.S. Trade Representative now with the Progressive Policy Institute. He added, “What they’re doing is sort of saying that this is a reciprocity policy that’s based on foreign trade barriers and so forth, but actually has nothing to do with that at all.”
Gresser explained that the administration's levy application relied on a mathematical formula derived from export figures and trade deficits, which he characterized as “really divorced from economic analysis.” Among those unfairly affected by the new tariffs are Lesotho, which received a staggering 50 percent tariff despite its minor trade imbalance, as well as other territories with negligible trade with the U.S.
The high tariffs could severely impact small countries. Lesotho, which has one of the highest HIV rates globally, relies on the clothing factories targeted by these tariffs for access to HIV medicines. “This could have really tragic implications,” Gresser remarked.
Countries such as Vietnam, Israel, and India have already made trade concessions to avoid new tariffs. For example, Vietnam announced plans to reduce tariffs on numerous products, including cars and various food items, only for the U.S. to impose a 46 percent reciprocal tariff regardless.
Experts suggest that smaller and poorer countries may find it more challenging to negotiate with the administration, as their limited trade significance puts them at the back of the line when it comes to deal-making.
The policy also underscores contradictions surrounding U.S. security alliances. The list of countries subject to tariffs includes Ukraine but omits Russia and Belarus. Treasury Secretary Scott Bessent defended these exclusions on Fox News by citing U.S. sanctions against Russia and Belarus due to the Ukraine conflict, despite Census Bureau data indicating that the U.S. imported $3 billion worth of goods from Russia last year and $20 million from Belarus.
Many economists believe the tariff rates imposed on most countries do not accurately reflect the trade barriers faced by U.S. goods and services. Despite attempts by White House officials to present a complex methodology, economists quickly pointed out that the rates essentially boil down to a calculation of each country's trade deficit divided by its imports.
"The vibe on Wall Street right now is a bit of chaos," admitted a Wall Street strategist who spoke anonymously. “This was a botched and child-like formula used to enforce something with massive implications." While many on Wall Street support Trump's objectives of increasing domestic production and holding trading partners to account, they express concerns about the methods and speed of his approach. "Every CEO in the industry is having a Maalox moment," stated Gary Shapiro, CEO of the Consumer Technology Association.
Trump's announcement aligns closely with his campaign promises, according to Unlimited Funds CEO Bob Elliott, who described the policies as “a f***ing wrecking ball” in a recent research note. He cautioned that further market losses might be necessary before a policy shift occurs and that it would take months to evaluate the broader economic impacts of the current changes.
In the meantime, confusion reigns. "This is not an economy that was in the hospital or suddenly in the intensive care," asserted Mohamed El-Erian, the chief economic adviser at Allianz. "This is an economy that was out of the hospital and was walking briskly."
Alejandro Jose Martinez for TROIB News
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