When President Donald Trump wanted to claim the success of his first term in an interview last month, he relied on the stock market.
“I was extremely proud to hand over the country when the stock market was higher than before before before before before before,” he told Fox News in a February 9 interview. “It was an incredible achievement.”
And in his second term he promised that the trend would continue.
“The stock market is going to be great,” he told the crowd at an investor meeting on February 19.
But his tone changed last week after stocks began spiraling downwards in fear that Trump’s use of tariffs could bring the US into a recession.
“You can’t really see the stock market,” Trump said in an interview aired Sunday on Fox News. “If you look at China, you have a 100-year perspective. There’s a quarter. We go quarterly.”
On Monday, the stock sank even more, erasing all profits since Trump’s election. The S&P 500 had its worst day since September, and the tech company’s stocks were hit hardest as the Nasdaq has lost its biggest day since 2022, sweeping out its trillion dollar value.
More than two dozen posts on Trump’s truthful social statements on Monday did not address the sale of the market. White House officials downplayed market movements in a statement to reporters.
“Since President Trump’s election, industry leaders have responded to unleashing American energy and unleashing American energy with their commitment to creating thousands of new jobs on President Trump’s America’s primary economic agenda.
The White House cited several studies showing that the investigation was conducted before Trump imposed tariffs on Canada and Mexico last week, but showed improvements in confidence among business leaders.
After Trump’s first term, he frequently uses the stock market to track the health of the presidency, like EKG, who tracks the health of the presidency, “the best stock market ever. It doesn’t just happen!” rally, he often cites the market and talks about how workers are grateful to him for making them rich.
The stock market had ups and downs during Trump’s first term, including a dramatic downturn at the start of the pandemic, but it was primarily on an upward orbit, with the S&P 500 index rising nearly 70% during Trump’s first term. The market continued to grow overall during President Joe Biden’s tenure.
On the eve of Trump’s inauguration, when the S&P 500 rose about 3% since the election, he mentioned the rise in stocks along with other improvements in the economy as the “Trump effect.”
“Everyone is calling it — I don’t want to say this, it’s too exaggerated, but say it anyway — the Trump effect. That’s you. Trump said at a rally with supporters. “Stock markets have skyrocketed since the election, and small business optimism has skyrocketed a record 41 points to 39 years’ highs. Bitcoin has smashed highs one after another.”
However, some of the optimism from investors overturned the course as Trump’s policies began to take shape in the first 50 days of his inauguration. Last week, the market decline accelerated last week when it took over the threat of imposing 25% tariffs from two of the US closest trading partners, Canada and Mexico, and placing an additional 10% tariff on imports from China.
Trump retreated to many of Canada and Mexico’s tariffs a few days later, but the taxation remained on many products and repeated that more tariffs would come in April. China on Monday imposes retaliatory tariffs on various US agricultural products, and the Ontario premier announced that the province will begin charging 1.5 million Americans 25% for electricity.
US tariffs on imported steel and aluminum are set to take effect later this week, with prices higher for some US manufacturers.
“The fundamental foundations of the economy are really strong. Unfortunately, there is a huge amount of uncertainty that is currently affecting meeting rooms and investors. The confusion is Canada, Mexico and Europe. So the good news is that this is the choice.”
Trump has not rejected the concept of economic pain from tariffs, and in his speech to Congress last week, he warned that there is a “transition period” and “minor obstruction” in his interview with Fox.
His top economic officials offered a warning last week. Treasury Secretary Scott Bescent said there will be a “detox period” away from government spending, while Commerce Secretary Howard Luttonick said the prices of some items will rise as a result of tariffs.
On Sunday, Trump maintained his tariff stance in his remarks to reporters when he returned to Washington from the weekend at his Palm Beach, Florida home.
“I think tariffs will be the biggest thing we’ve ever done as a country,” Trump said. “We intend to enrich our country again.”
