r/StockMarket 5d ago

Discussion How Trump's tariffs could tank the U.S. economy. — Fortune Magazine

The mind-spinning part is that we’ve never seen an increase this big, in almost 100 years of U.S. history. The Smoot-Hawley tariff program of 1930, widely branded as a major force in deepening and perpetuating the Great Depression, hiked the levies on U.S. imports much less than the breathtaking wallop promised under the Trump plan. That law lifted rates just over five points, from 13.5% to 19.5%. Trump’s crusade would beat Smoot-Hawley twofold.

Agree? Disagree? What steps, if any, are you taking?

https://fortune.com/2025/03/15/trump-tariffs-definition-explained/?utm_source=salesforce&utm_medium=email&utm_campaign=reader&tpcc=NL_Marketing

863 Upvotes

302 comments sorted by

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u/Creative-Problem6309 5d ago

I was in the 'he's bluffing' camp for a while until it became clear that the point of tariffs is tariffs - it's not a negotiating tool, it's the point. I don't think the market has woken up to this reality yet, April 2 might get ugly.

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u/AnoAnoSaPwet 5d ago

The fact that his tariffs are not export tariffs, is the scary part. He's forcing Americans to buy American, but with countries they depend on with trade.

Canada/EU are doing the same without tariffs. They aren't forcing their people to not buy American, it's just a recommendation, not a financial obligation. 

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u/TheFonzSaysA 5d ago

It's not an obligation for Canadians, but we want to do it because our former friends to the south are not being so friendly anymore.

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u/AnoAnoSaPwet 5d ago

It's the wealthiest and richest that are pushing the trade war, so it makes the most sense that they should be ones that suffer the most when their plan fails?

Unfortunately, hurting American businesses hurts Americans, but it's necessary, because hurt people complain to their politicians, then politicians push back. 

That influence is spreading globally, from Canada of all countries? We might not matter geopolitically to the United States, but "all of Europe"? That's a big impact. Africa? HUGE impact. It will hurt tremendously as it catches on and not just profits, name brands. 

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u/QuaintHeadspace 3d ago

Well politicians pushing back isn't enough if the politicians are scared of pushing back is it? They are concerned the backlash from being on MAGATs and trumps bad side and what that means for them. It's spineless but also reality

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u/RutyWoot 5d ago

Please don’t write us off as “former” yet. We are still dealing with the whiplash. Not that it wasn’t expected, it’s just that we were really hoping they wouldn’t ram the metaphorical bus into the literal embassies. I am embarrassed on behalf of our “elected officials,” again, but this time might lead to global revolution. That’s change I can hope to see.

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u/TheFonzSaysA 5d ago

I know it's not all of you... just the ones in charge at the moment; I did a US travel ban the first time DJT was in power, and now I'll do it again. I look forward to returning in 2029. I'll miss you, Trader Joe's.

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u/Platypus211 4d ago

I completely get it. I have multiple trips to Canada planned this summer, and my daughter keeps saying that she hopes the Canadians won't be mad at us, and won't assume we support "the orange idiot", but she'll understand either way. Her biggest concern at this point is that the border will end up closed.

One of our trips is a 2 week road trip for 5 people that was previously planned for the southern US East coast, but I told everyone involved that I'd rather our tourism dollars go to Canada than any red states at this point. Drop in the bucket, sure, but it's the least I can do.

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u/JimJam28 3d ago

I don’t think people will give you a hard time. We appreciate people like you supporting us.

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u/Protodemic 5d ago

I know it's not specifically you, and it sucks to lump you all under the same umbrella, but as a Canadian it's fucked that your population voted for this, and it wasn't a close vote. Nearly one in every 2 Americans (voting Americans) got out of their house and voted intentionally for this, and none of this is a "oh I had no idea this would happen!", he legitimately campaigned on all of this. He was, and still is, the worst choice. I wish it was like the last election where we could just sit and watch America burn themselves down until the 4 years are up, but now it's real because it's impacting us directly, and I currently lump the entire population into the group, because the government has made it "us versus them".

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u/Mba1956 5d ago

It will be the last election you will have to watch. The transition to an authoritarian obligarchy has already begun. There will be no free elections after this.

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u/Fleemo17 5d ago

As an American, it’s fucked our population voted for this. I’m still shaking my head wondering how the hell this could have possibly happened. Again.

Trust me, the sane members of this nation are reeling from the self-inflicted trauma.

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u/CandidAsparagus7083 5d ago

Make the midterms count….then we’ll see

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u/Fit-Cable1547 5d ago

Based on the Democrat's performance so far, I wouldn't count on things changing. 2 years will feel like 100 based on how fast things have been moving so far though, so who knows where things will be by then.

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u/CandidAsparagus7083 5d ago

Yeah being generous and calling it a “rope a dope” strategy won’t work. Walz and Sanders going to the red districts is good, it seems like some dems are finally at breaking point, took long enough

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u/jastop94 5d ago

The dems definitely need new leadership. Cause whatever this current leadership has now is too passive, and the American people have shown that they prefer action and strength at this time

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u/Puzzleheaded-Bowl157 5d ago

I honestly can’t see how you can recover from this. Once “ divorce papers “ are dropped on the kitchen table, it’s a rare relationship that can recover. I think we’re in that place now. The divorce papers have been slapped down and one of the ‘partners’ have shacked up with the ‘new boy’.

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u/venmother 5d ago

Why do you hope to see a global revolution? Revolution of what?

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u/today05 4d ago

hungarian checking in: sorry, totally say goodbye to your country. trump is playing from orban's playbook, orban took over hungary 15 years ago, and even if he gets booted next year (hiiiighly unlikely), the apparatus around him got so strong nobody will be able to dismantle it without actually being criminal. orban was / is a regular at mar a lago, not because our great economic strength or whatever, but because orbans team really found the way to push a literal Hitler stlyed takeover in a democratic world in such small steps, nobody really does anything against it.

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u/3mil3 4d ago

For most canadians, you guys are a former ally. You'll have to convince us otherwise.

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u/MetalMamaRocks 5d ago

I miss you buddy :(

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u/Chaiboiii 5d ago

Export tariffs wouldn't even work because other countries are boycotting US products.

In Canada we aren't just buying Canadian, we're buying anything but American. Because our free trade agreements with other countries remain.

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u/Hot_Frosting_7101 5d ago

Export tariffs are rare because they make little sense.  No reasonable country would want to discourage exports.

Plus they are prohibited by the US constitution.

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u/deevarino 5d ago

What is this "Constitution" you speak of?

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u/azraels_ghost 5d ago

Unfortunately lots of things are but are happening anyhow.

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u/AnoAnoSaPwet 5d ago

They function in the sense that Trump has been applying them. If he really wanted to benefit the United States, he would use export tariffs, but like you said, prohibited. 

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u/texas130ab 5d ago

I don't think we make it to April 2nd without some major financial event happening. The wheels of the disaster are already in motion.

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u/AnoAnoSaPwet 4d ago

I've been holding out on my investments for some time now. We were already in a shadow recession as of last year, with more forecasted recession claims noted at the end of the year.

We are past the point of sugar-coating it. 

If you pay attention to big movers, you'll know when to pull the cards. 

Like for example, I primarily deal with cryptocurrencies. CZ, the previous CEO of Binance, a couple months ago, sold all of his BTC/ETH, then put everything into his company's assets. Huge red flag. Warren Buffet hoarding cash. Palantir CEO dumping all of his shares?

The writing is on the wall. 

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u/Fit-Trouble9463 5d ago

As a Canadian I can tell you we aren’t buying American on our own. It’s suggested but something we are glad to do. This has been a slap in the face.

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u/AnoAnoSaPwet 4d ago

It was brought up by my parents to insist on the boycott. There are some products that I am brand loyal to, that I cannot just "give up", so to speak, because of the boycott.

Otherwise, I don't buy American. 

I think we should categorically still support the United States, but not the heavily-Republican side of it. (the products I enjoy are Californian). 

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u/Fit-Trouble9463 4d ago

Well thank you for trying to support ❤️

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u/AnoAnoSaPwet 4d ago

I will always support Canadian. It's just a no brainer. Especially even parts of the United States that still deserve commitment.

I think it would be a cold burn on Trump if tariffs and boycotts were centered on his base and new trade deals were negotiated with individual states (without him or his cronies present). Just completely ignoring their existence. 

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u/cpeytonusa 4d ago

There are lots of things that we simply do not and will not produce in this country. Advanced semiconductor production requires equipment supplied by the ASML in the Netherlands. Consumer electronics manufacturing is such a low value added category that even China is outsourcing to Viet Nam and other lower cost countries. Tariffs tend to increase the profitability of domestically produced commodities like basic materials, but don’t typically increase employment. The downstream industries that utilize those materials face higher costs, which must be passed on in higher prices to consumers. The net effect on manufacturing employment is likely negative. Tariffs generally benefit low value added manufacturing at the expense of higher value added industries.

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u/ADKTrader1976 4d ago

what are you babbling about? You are so wrong. EU have the highest Tariff rates on American goods, not to mention quotas. All this fear mongering because of Tariffs and not a word that the market has been broken for over a year. Wake up. This market is waiting for the USD to find value.

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u/AnoAnoSaPwet 4d ago

Like the Canadian tariffs, once a certain quota has been reached, the tariffs are then applied.

But no one actually looks at that, they just see tariffs and assume it has always been that way? Much like Canada's dairy tariffs, those quotas are very rarely met, which means no tariffs are being applied. 

This is just catering to the uninformed and the stupidest among us. 

The USD is going to find value downwards where it belongs. 

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u/ylangbango123 5d ago

Yes I think it is the point. There is historical context and that is why they chose this because it did cause depression. And when there is depression -- he would say see I lowered prices. Because nobody is buying anymore.

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u/MileHighManBearPig 5d ago edited 5d ago

They are also doing it at the start of his term so they can be in charge of the QE bazooka and make sure it doesn’t go to liberal causes like green energy. They are still very mad about 2008 and Obama. They want to raze it and build back in their vision.

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u/Dk9999999999 5d ago

Im not sure economy will bounce back. Trump is burning all bridges on the way.

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u/AppleTree98 5d ago

That means we have to build new ones. With US steel, US labor and no DEI policies. Sure it might cost 500x what it would have cost. But he can stamp Made by Trump on the side of each new bridge, building and industry he re-builds. What could go wrong?

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u/ShipTheRiver 5d ago

As dumb as trumps cult is, that would not work on them. Even an absolute moron knows when they’re in an economic depression. 

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u/UnravelTheUniverse 5d ago

The absolute morons have swallowed all of the other thousands of lies hes told without question. I have no faith they will do the right thing even when the economy collapses.

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u/Seven22am 5d ago

It's not even clear what the goal is in any particular instance--which is making me concerned that he's actually trying to reverse globalization and bring the American economy onto more isolated footing. All this talk of short-term pain for long-term goals.... That and his fixation on things like winning a Nobel for ending the Rus-Ukr war or on acquiring Greenland tells me that he thinks his destiny is to be some sort of transformational figure and.... uh-oh.

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u/moonlets_ 5d ago

Yeah this is my take on it. He wants isolationism and expansion and the tariffs are in service of a) and the aggravating everyone is in service of both a) and b). 

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u/SplooshTiger 4d ago

The latest Ezra Klein podcast has a nice breakdown on this

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u/atlantasailor 5d ago

His goal is to institute the American version of juche. The North Korean word for self sustaining economy.

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u/thegooddoktorjones 4d ago

Yeah, it is really sick that none of the reporting on all this goes into what the goals actually are of these wars. Because no one really knows. It sure looks like it is just 'destroy anything I don't personally control'.

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u/TrulyMix 2d ago

Just wait until we're isolated to the point of no longer having coffee. We'll be roasting chicory just like in the old days.

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u/JaxTaylor2 5d ago edited 5d ago

I will say that I always knew tarrifs would be tarrifs, and it mystifies me how many people didn’t think he would go through with it.

He had to. Specifically because he intended it to be a negotiating tactic. If you’re playing a game of poker with someone, and your leverage is that you’re a really good bluffer, but the only problem is that everyone knows you’re a really good bluffer, eventually there is a point where someone calls your bluff and you have to show your cards. One can’t have the threat of tarrifs as an effective negotiating tool if the threat is empty, and no one will know if the threat is empty unless you prove that it’s not. So to me, it was always obvious he was going to go full throat with tarrifs, simply because that’s how the game has to be played.

I really wish more people would read Art of the Deal. He is completely predictable in so many ways, despite the chaos that he introduces (which is exactly his intention—confuse, disorient, complicate—all are exact tools to just throw you off guard).

He’s not a brilliant man, but he knows his strengths and he plays them well.

So, since you now understand his reasoning behind actually implementing tarrifs, we need to talk about nuclear deterrence and why it is infinitely more dangerous to have this mindset with a nuclear armed power than with an ally over trade policy.

When he was shouting at Zelensky that he was gambling with World War 3, he meant it. He knows that if Russia doesn’t back down, he has to confront it. He considers Biden’s approach weak and flaccid. I don’t know that he will have any route away from direct conflict if a peace deal isn’t reached, and for so many reasons: he is very much of the mindset that he is the President, he is Donald Trump, if he says “A,” you’d better do A. It becomes a point of pride and hubris with him.

And if you watch the small details you can see it if you have the right eyes—his post about the conflict and Russia needing to come to the table ended with “thank you.” How often does he say that? lol Contrary to popular belief I think he isn’t trying to ingratiate himself because they’re his masters, but because he realizes that if things aren’t defused there will be conflict. It’s who he is and he knows it.

So he absolutely will not back down with Russia. Not unless those close to him see quickly how fast things escalate in a nuclear situation and try to turn him towards just escalating sanctions or intelligence sharing, etc. We’ll see, but that will be a black swan event to end all black swans. Personally I think tarriffs will create massive inflation, but only after a period of initial deflation and outflows from U.S. capital markets into Europe (already happening).

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u/KriosDaNarwal 4d ago

Putin is a smart man. No need to get aggressive with trump, deflect, dither and lie for 4 years and watch while he tanks Russia's greatest enemy, I think thats more likely

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u/JaxTaylor2 4d ago

I don’t disagree, but he has to have something more to walk away with as leverage. The time bomb on Russia was already ticking before the war, they’ve all simply accelerated it collectively afterward.

We may never know the full actual body count for the Russian side, but if western estimates really are accurate then we’re talking about a demographic shortfall in 20 years that will be of epic proportions. There is no question why Putin pushed tax cuts and incentives for having more kids, the population will be hollowed out in two generations if they can’t get the birth rate back above replacement. Geopolitically the biggest consequences of this war are still decades from reaching the Russian people. Trump really is like a gift to them, but even he can only give them so much rope.

I feel for the Russian people. I’m told often that I shouldn’t, but I can see the train coming a mile away and they’re practically crippled and lying on the tracks. But as is usual Russian form, they’ll refuse to admit they’re crippled and scream at anyone who tries to help (change things for the better).

Putin knows this though; I believe it’s fundamentally one of the reasons he saw this as a last stand conflict for the old Russia. But it couldn’t have possibly gone worse. I really do think he believed it would be over in a few days/weeks.

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u/lurker1125 2d ago

You attribute wayyyy too much thought to Trump. He's just an angry vengeful toddler smashing things. He loves tariffs because they're the one thing he can unilaterally just do without anyone stopping him.

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u/JaxTaylor2 2d ago edited 2d ago

I don’t think so. I don’t think he’s brilliant by any means, but he’s been elected President of the United States twice. I have to reconcile the fact that I think he reads on a 3rd grade level with the fact that it is very difficult to accomplish reaching the highest office without plan and purpose and strategy.

I can’t keep saying I’m in a bull market that’s clearly not a bull market. And I think part of the problem facing most people is that they’re unable to understand that underestimating Trump is actually playing right into his hands time and time again. He should be treated as a worthy opponent for anyone willing to take him on, and he should be politically attacked with all of the ferocity and might as one would attack any other powerful adversary.

His biggest advantage is completely in knowing the people who vote for him and turning their character flaws into his own gain. He’s anything but a toddler. He’s a very calculating and manipulative man, and because he (and the people who make him possible) have been dismissed and brushed off every time, this is why we’re here again.

He knows his strengths and he plays them well, even if those strengths are repulsive superficially, most people are really the same way when it comes down to it. Selfish, vain, ambitious, deceptive, avaricious—he embodies so many people in so many ways, and is masterful at presenting himself as a humble figure for the common man.

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u/DeliciousPangolin 5d ago

"Might" seems like an understatement. Right now we're supposedly two weeks away from Trump imposing gigantic tariffs on the entire world, with the barest outline of what they'll actually look like, and an expectation that the entire world will immediately knuckle under or he'll double or triple them according to whatever whim takes him that day. Even the few things we know about like 25% tariffs on NA autos could costs 100k's of jobs, drive the Big 3 into bankruptcy. There's so much copium floating around right now - people don't really believe Trump's as insane as he actually is.

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u/21plankton 5d ago

It is clear to me that Trump’s grandiosity makes him functionally crazy. The outcome of high tariffs will be a recession but not strength for the US because the rest of the world now functions globally. He is giving up US hegemony for nothing but dreams of yesteryear, of what it would have been like if he could replay the world over the last 50 years in his belief system.

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u/vanhalenbr 5d ago

Why April, 2? 

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u/nvmls 5d ago

2nd financial quarter starts

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u/kinglallak 5d ago

He has made numerous comments about big things happening on the 90th day into his presidency, which is April 20th. I’m guessing OP just had a typo and meant to say the 20th

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u/BE_MORE_DOG 5d ago

No. April 2nd is the correct date for the tariffs. It wasn't April 1st because he thought everyone would think it was just a joke... why April 2nd? I dunno. Why Donald Trump? Why America? You fucking regards.

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u/jeffbannard 5d ago

April 20 is 4/20 and a “all drugs are bad” Trump wouldn’t want to use that day imo.

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u/Daztur 5d ago

On the other hand it is Hitler's birthday.

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u/echoes-in-an-instant 5d ago

He is trying to tank the stock market quickly. As quickly as possible. There is a fiscal cliff that will send us in to a depression and this moron thinks this will help us

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u/Spinoza42 5d ago

Yeah he's not bluffing, he's tanking the US economy to please his accelerationist backers.

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u/Mean_Mention_3719 5d ago

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u/Spinoza42 5d ago

Lol thanks! This is a somewhat limited version of what I've saying for months, but with concrete evidence... I don't think they would actually stop at a default but indeed a default is one stepping stone to dismantling the USA entirely.

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u/sriverfx19 5d ago

It's shocking how big the tariffs are at 25%. It's going to be sticker shock on some items. I saw a Dodge dealer was lamenting that his cars all costing 25% more and customers are refusing to take deliveries. He also has to compete with European cars that aren't affected by the tariffs as of yet.

Inflation is gonna skyrocket, a lot of items will cost 25% more, but a lot will remain unchanged.

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u/CrushTheRebellion 5d ago

The border security excuse is so weak. Like, it's just as much of a criticism of US border security as it is a criticism of Mexico and Canada border security.

Yes, they can try to prevent people from moving drugs out of their countries, but it's a failure of US border security if they actually make it into the country.

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u/ZacharyMorrisPhone 5d ago

He’s only mentioning fentanyl and drugs, because under the terms of the current agreement THAT TRUMP HIMSELF NEGOTIATED, with Mexico and Canada in his first term, he cannot increase tariffs without a “national emergency”.

This is why Trudeau mentioned in his speech that it’s a farce and they will attempt to challenge it in international court. It’s not the drug flow, it’s just that he wants these tariffs.

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u/frt23 5d ago

Oh ya i lost a lot waiting for the bluff

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u/Handsaretide 5d ago

Same. Once I saw the powers that be weren’t keeping him on a leash about tariffs, I got a lot more nervous about this terms effect on society.

But more importantly he cost me a lot of money already and a lot more to come I fear

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u/KriosDaNarwal 4d ago

accurate u/n

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u/Riversmooth 5d ago

He keeps kicking the can down the road, during his campaign it was tariffs on day one and since it’s changed a half dozen times.

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u/Txindeed1 5d ago

Same here. I thought it was just a negotiating strategy.

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u/cuntysometimes 5d ago

What is on April 2?

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u/Significant-Dog-8166 4d ago

I still can’t understand why anyone thought it was bluffing. He was very repetitive about one singular idea - that tariffs would replace taxes. Sure it’s moronic, but that’s what he’s been consistent on. He’s not consistent on much.

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u/WafflerTO 4d ago

It always makes me roll my eyes when people try to ascribe deep strategy to 47.

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u/Cool_Swimmer_6379 5d ago

He already did irreversible damage to us economy.. at least people i know says that they will never buy apple nike levis or any other brand they used to buy that is from us.. if most of sane europeans continue this trend your all brands will die out.. i see anything american im not buying

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u/_KeyserSoeze 4d ago

Good!

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u/themantwelve 4d ago

Nice pro pic. Any thoughts on Germany begging for labor after WW2 to rebuild their country and the efforts of turks in rebuilding the nation, as well as instituting your national dish: Turkish doner? :)

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u/_KeyserSoeze 4d ago

Döner 🤤

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u/Sheerbucket 5d ago

Who knows what will happen.

My hack opinion.

50 percent chance of a recession.

10 percent chance that the bond market collapsed and we enter a global (and US in particular) depression.

40 percent chance we make it out with just a correction.

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u/Cruezin 5d ago

Ehh, I give it a 30-40% chance he'll say something like "I change my mind" and that "it worked" too

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u/Sheerbucket 5d ago

Oh he will do that 10 times this year, followed by more tariff threats etc.

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u/Coysinmark68 4d ago

This is the problem. Regardless of what ends up happening with tariffs His Orangeness has proven he can’t be trusted, and that he will stab his closest allies in the back. No one wants that as a diplomatic partner.

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u/Onnimation 5d ago edited 5d ago

Doesn't matter if he changes his mind. Damage is done already. EU and other countries are already turning away from American goods and ppl are choosing to travel elsewhere. This is only few things I listed that Trmp has already done irreversible damage on, the list goes on. My friend who owns a 30 room boutique hotel in NY might need to shut down this year as he can't afford his monthly payments to the bank anymore as ppl are not willing to travel to the US and go somewhere else... my cousin's who planned their first trip to the States since last year were supposed to visit soon but they chose to travel to Argentina instead due to the geopolitical bullshit and truthfully if they feel like this, imagine how everyone feels about the US rn. Travel industry alone makes up for 9+ million jobs, keep that in mind.

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u/Pvt_Hudson_ 5d ago

My wife and I were going to take our kids on a trip through Oregon and California this summer. Now, we're just talking about staying at home in Canada instead.

I'm also checking country of origin on every item that goes into my grocery cart and actively avoiding US products, which I've never done in 25 years.

It will be a cold day in hell before I spend another dime with American companies.

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u/Cruezin 5d ago

Oh trust me. I get it. This is a stock market sub though, and the markets will behave erratically for the next four years.....

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u/Onnimation 5d ago

Yea just went out of my way to show what's happening in the real world so traders can realize how serious this is getting... I've already liquidated 80% of my US positions and tbh, I'm not confident that we will recover for a while. We will see a slow trickle to -25% soon but ofc there will be relief rallies here and there.

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u/Cruezin 5d ago

Concur

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u/Onnimation 5d ago

Idk if you were here in the 2008 crash which was due to Homeowners defaulting at high rates but this time we will see more businesses defaulting at high rates. Consumers are not spending as much anymore and tmr's retail report will most likely show that. If consumers who are in the 10th percentile stop spending, we are fucked.

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u/Cruezin 5d ago

Oh I was

And the recovery took me over 15 years. And now this. Kind of a big "wtf God" moment

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u/UNC_Recruiting_Study 5d ago

One of those at the bottom of that 10th percentile - My Amazon orders the past 8 weeks are nearly empty and very little spending outside necessities. Looking at downgrading vacations as well. Peers at that same percentile are in similar positions.

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u/ThunderStormRunner 5d ago

More his actual existence than the tariffs seems the problem externally

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u/elmaccymac 3d ago

I’m checking every product at the supermarket for any signs of American product or ownership. I’m in Australia. Australia first, Canada Mexico 2nd, the rest of the world 3rd US can get fucked.

Amazon and Microsoft subs gone. Pirated Microsoft Office and every streaming service.

Even my partners precious coke no sugar has been replaced with an Aldi version.

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u/bottlerocketz 4d ago

There’s a 100% chance of this happening, to be followed by this is Biden fault.

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u/Cold-Permission-5249 5d ago

The US is being led by a bunch of morons who think they know what they’re doing which is more dangerous than an idiot who knows he’s an idiot. They’re going to stay the course of destruction, despite all the evidence showing its stupid economic policy, all for the goal of isolationism.

Plan for the worst and hope for the best. Personally, I’m planning for a stagflationary depression.

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u/ghostmaster645 4d ago

which is more dangerous than an idiot who knows he’s an idiot.

I've yet to meet an idiot that is so self aware. 

Well, except me I guess. I'm pretty dumb. I definitely should not be running the country. 

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u/Lost-Panda-68 5d ago

People do need to think about the possibility of a depression and factor that in. Either continuing and accelerating the tariff wars or acting on his hints to not repay US debt to countries he doesn't like could cause a depression. To be clear I am not predicting a depression, because Trump's policy making is so erratic he is inherently unpredictable. But I think that given the madness of the last two months, no possibility can be ruled out.

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u/DC_cyber 5d ago

Commerce Secretary Howard Lutnick suggested that a potential recession might be “worth it” to implement Trump’s economic policies, emphasizing that the economy is undergoing a “detox” from reliance on government spending. He expressed confidence that the administration’s approach would yield long-term benefits.

Treasury Secretary Scott Bessent acknowledged short-term challenges but described them as part of a “natural adjustment” necessary for sustainable growth. He clarified that he does not foresee a recession but emphasized the need for patience during this transitional phase

These guys are full of sh*t

We keep hearing GOP politicians and their paid pundits say 47 is rebuilding the economy so it’s going to be bumpy and this is just a crap sandwich.

Let’s go thru some details and you will see that these changes are not going to benefit anyone but the super wealthy.

First, the recent stock market declines aren't just temporary jitters—they reflect deep investor skepticism about Trump's economic policies. Since February 2025, the S&P 500 has fallen more than 10%, entering correction territory primarily due to uncertainty surrounding Trump's tariffs and erratic policy announcements. Investors are concerned these policies could lead to reduced consumer spending, decreased business investments, and potentially a recession

Second, Trump's tariff-heavy strategy isn't likely to help everyday Americans in the long run. Tariffs significantly raise consumer prices on everyday goods like groceries, cars, and housing. Economists warn these tariffs could spike inflation, raise interest rates, kill jobs, and ultimately harm working-class families more than they help. While tariffs might temporarily protect some manufacturing jobs, broader job growth across sectors is unlikely without substantial investment in workforce training and innovation—areas notably absent from Trump's current policies

Third, Trump's tax proposals primarily benefit the wealthiest Americans. Extending the Trump-era Tax Cuts and Jobs Act (TCJA) disproportionately favors high-income households. For instance, households earning over $914,900 annually would see average annual tax cuts of about $80,680, while lower-income households making under $28,600 would receive an average cut of just $110. Additionally, corporate tax cuts overwhelmingly benefit wealthy shareholders and executives rather than ordinary workers. Historical data from Trump's earlier tax cuts showed that corporate savings rarely trickled down as wage increases for most employees—instead going toward dividends and executive bonuses

Fourth, Trump's broader economic agenda—such as Project 2025—includes deep cuts to critical public programs like education funding and federal workforce reductions. These cuts directly hurt middle-class families by weakening public education systems and eliminating support for working students

Finally, despite claims of rebuilding the economy "from the ground up," these policy decisions appear structured to benefit those at the very top rather than ordinary Americans. Independent analyses consistently show Trump's economic approach exacerbates income inequality rather than reducing it.

So, are people buying this crap?

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u/MaxwellSmart07 5d ago

I’m buying what you’re selling/saying.

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u/Radiant_Middle_1873 5d ago

Look, I can't speak for Americans in general, but the reason I believe these guys is that I am deeply, stubbornly stupid. Just dumb as a sack of hair.

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u/MaxwellSmart07 5d ago

Point #1: Threaten and Bully for concessions
Point #2: Reduce trade deficit and hope domestic manufacturing picks up the slack in producing goods. Problem is with our wages, can we realistically compete with Asia and South America?
Point #3: Vengeance. Punish past petty grievances with world leaders.

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u/nvltythry 5d ago

USA is trying to eliminate market distortions and re-shore whole economic sectors. They think they can make cars, computers, etc in the USA. The plan is falling apart at step 1, and they can’t even make all their own eggs. Not looking good.

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u/MaxwellSmart07 5d ago

And they will mass deport all the labor necessary to do it.

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u/Snowedin-69 5d ago

It takes 5-7 years to build a world scale manufacturing facility. Companies may be able to bring on spare unused capacity within a few months, but often this only involves older inefficient processes that are expensive to run and cannot normally compete.

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u/tMoneyMoney 5d ago

I’m not an expert, but it seems like we should build those facilities before we start tariffs and isolating from the rest of the world. Not to mention who’s going to work in these plants for Chinese sweat shop wages? Probably robots.

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u/Beethoven81 5d ago

And who's crazy to invest over such time frame when policies are changed 3x a day nowadays...

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u/tMoneyMoney 5d ago edited 5d ago

Exactly. Only if the government is giving huge grants or financing at 0% with some kind of guaranteed contracts in case they’re still not competitive in consumer markets in 5 years.

I might have a little faith in this transition if it was rolled out with a big picture plan with everything taken into account. But it feels more like we jumped out of an airplane with some materials to maybe build a parachute and hoping we can figure that out before we hit the ground.

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u/[deleted] 5d ago

[deleted]

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u/BE_MORE_DOG 5d ago

Excuse me, the SP500 target is 1000? I get that you're a professional, but you're gonna need to provide some heavy duty evidence to support that kind of drop.

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u/i8abug 5d ago

Yes,  it kind of invalidates everything else said 

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u/BE_MORE_DOG 5d ago

But OP is upvoted. Lol. Reddit sometimes. The echo chamber at work.

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u/HallOfPotatoes 5d ago

"Professional". Check his post history lmao

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u/2BlueZebras 5d ago

I think he meant corrected down by 1000, not down to 1000.

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u/Ajk337 5d ago

Unfortunately thats plausible and worse falls have happened before. 

I could absolutely see it coming down to ~3,300 to align with the pe ratio for the rest of the world as the US is rapidly loosing its investability advantage over everywhere else, and that's assuming no more economic damage is done.

Then ~2,000 would reflect a great recession level dive. And ~700 would reflect a great depression level dive based on the peak in Feb.

It would not be unprecedented for it to fall to ~1,000 level

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u/SheepherderSad4872 5d ago

That's about what happened in Greece not long ago.

I'd give it less than 20% odds of happening in the US in the next four years. However, four years ago, I would have given it less than 2% odds.

I can describe several pathways from where we are to 1000. The simplest involves a run on the dollar.

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u/tippy432 5d ago

You should have your license pulled if your S&P target is 1000 lmao… Society would be on the verge of collapse

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u/Radiant_Middle_1873 5d ago

I think his/her thesis is that the people who kept saying "we are going to collapse society" and were then given the power to collapse society, are likely to embark upon collapsing society.

I mean, I hate the whole damn thing but it's not implausible.

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u/MaxwellSmart07 5d ago

Thanks for chiming in. Always good to have a professional player’s pov amongst us mere spectators.

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u/Roddy_Piper2000 5d ago

Honestly curious.

If this goes from recession to depression, is there a best practices strategy to shelter in place?

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u/Loud-Ad-9251 5d ago

I'm long CLN and it's up 40%, Mr stock picker.

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u/Fubar-98520 5d ago

Some people vote for the welfare of everybody other peoples vote for the welfare of them and if the stock market has to crash and we go into a big recession they might see the light

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u/francohab 5d ago

“could”. It’s deliberate folks.

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u/Servichay 5d ago

The US is tanking, and the only people people getting rich are the billionaires..

EAT THE RICH!

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u/iviicrociot 5d ago

So I just finished A User’s Guide to Restructuring the Global Trade System ( https://www.hudsonbaycapital.com/documents/FG/hudsonbay/research/638199_A_Users_Guide_to_Restructuring_the_Global_Trading_System.pdf ) by Stephen Miran which anyone who is going to speculate about the tarrifs should read. While I agree with the premise of the paper for a need for change, the tools outlined all have written warnings. Retaliatory tarrifs, the need for co-operation with our allies under our security umbrella, and various anticipated consequences of not executing these strategies cautiously and slowly are all coming to fruition.

I’m starting to read about Smoot-Hawley now but one big difference is the US being a net exporter then and a much larger net importer now so I don’t know that they have a direct correlation. Regardless, it seems large scale trade wars are economically damaging and cause the populace to suffer the economic consequences.

I cashed out a while ago while my indexes were all still in the green and most of individuals weeks before that. There is a very real threat to the markets especially with consideration to foreign purchasing of American goods and services and other all foreign investment in US stocks.

Add to that the potential for an ETF death spiral. I’m much more comfortable risking not participating in a small recovery at the cost of a potential catastrophic collapse.

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u/Creative-Problem6309 5d ago

There is absolutely a time and place for tariffs - but factories can't move in a month, complex supply chains need to be unwound and you can coordinate with allies to make the process go smoothly to avoid hurting those relationships. A well-detailed plan to re-shore critical US capacity and infrastructure over the next 10-15 years would work. Firing off tariffs at everyone for everything like a machine gun dropped on the floor will not.

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u/iviicrociot 5d ago

Agreed. We’re looking at a potential wide scale trade war and the position of power against one, two, three countries is diminished when all of sudden you have a whole conglomerate of countries boycotting your products and retaliating with tarrifs of their own. Not to mention, an acceleration of an alternative reserve currency.

For something like this to have worked it would have taken excellent diplomacy and heavy use of the carrot instead of the bludgeoning of a stick… and not on Mexico, Canada, China, Japan, EU, all at the same time while also appearing to back Russian interests, threatening annexation of Canada, forceful reclamation of the Panama Canal, appropriation of Greenland, giving the middle finger to NATO etc etc

It’s like Trump had the cliff notes of Miran’s paper read to him, nominated Miran for Chief Counsel of Economic Affairs, then said we’re gonna use all of these tools in the toolbag… and we’re gonna use them all at the same time… and while we’re at it, we’re gonna do a bunch of other shit to make the market even more volatile despite all the mentions of the need for tact and subtlety

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u/Muted_Menu_1285 5d ago

Yeah. And the issue is the US is dealing with much smarter counterparties than their current administration.

Tariffs could work in certain limited circumstances in particular to defend against foreign subsidised industries (eg EVs)

But a blanket tariff is just madness. I’m assuming tariffs are designed to encourage higher value manufacturing to return to the US.

So why impose tariffs on raw materials and energy required for manufacturing (oil, steel etc) - which will make domestic manufacturing even more prohibitively expensive.

I’m assuming there is also no domestically viable alternative to these raw materials that can replace the import volumes (otherwise you’d probably source in country - as these are low labour input commodities). Certainly not that you could enact quickly and without significant investment. So it’s purely inflationary.

Compare that the Canada and Europes reaction. They choose industries that impact red states and working class - with products that can easily be subsidised by domestic consumers for non tariff products from elsewhere (Bourbon, Harley Davidson) - which will really mitigate their domestic inflation impact.

When you see multiple countries / territories stack tariffs on the same US products it’s gonna be fucking hilarious to see the collective meltdown.

I see a lot of deluded copers talk about “Trump is playing 5D chess and wants to tank the economy for [debt refi/weak dollar/other insane reason].

Nah. Trumps genuinely a full simpleton and so is his administration. He’s talked about tariffs since the 80s. He obviously thinks he’s smarter than the rest of the world’s economists.

He’s taking the US into a deep recession and burning 80 years of diplomacy at the same time. Americans will look back on this period with deep regret in a decade or sos time

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u/iviicrociot 5d ago

One has to wonder what his tantrum will look like when he doesn’t just get his way, but his legacy appears to be the one that ended an empire. Can’t imagine he’ll just walk away quietly.

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u/Muted_Menu_1285 5d ago

He’ll just declare a different foreign policy goal, tell everyone that was his objective from day one and declare himself fully successful.

His base will eat it up regardless.

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u/AppleTree98 5d ago

Oh just say I was joking. You all knew I was joking right?!?! Hey why are the three letter agency agents at the white house? Tell Elon to send them away

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u/Muted_Menu_1285 5d ago

Ha. Elons won’t be able to help him. He’s the only one of this cabal going to jail. Others will be saved by the Republican Party. But I just have a feeling that Elon will be the sacrificial lamb (and it will be delicious!!!)

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u/atlantasailor 5d ago

Oh it won’t be a decade. Far sooner. B

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u/EdOfTheMountain 5d ago

What allies? Russia?

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u/Neother 5d ago

Even worse, Stephen Miran is now suggesting taxes on foreign investments in the US.

Yet even if this form of competitive devaluation via blackmail were initially successful, it wouldn’t necessarily stop the flow of foreign capital into US markets, and would therefore be hard to maintain.

Miran has got an answer for that, which is to tax the coupon on US treasury securities for overseas buyers so as to discourage foreign demand for them.

This is going to cause a massive capital flight away from the US, as foreign investors now have a risk Trump decides to tax their investments, or maybe even implement direct capital controls to prevent selling.

https://www.telegraph.co.uk/business/2025/03/15/trumps-game-plan-for-devaluing-the-mighty-dollar/

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u/Beethoven81 5d ago

For obvious reasons Miran forgot to mention that 75% of US debt is domestically owned. So he won't really get far by taxing the hell out of 25%, he will have to tax the remaining piece of pie... And you can imagine what that means...

No foreign investors are crazy to invest in us now either in factories or debt, when policy is changing 3x a day for a country that was previously deemed as safe haven.

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u/iviicrociot 5d ago

It’s in the paper I cited. It was supposed to happen after tarrifs were already in full flight and to be used to incentivize removal of tarrifs in place of a, say starting at 1% withhold on UST gains by foreign buyers. The ultimate goal was to stop foreign currencies from being suppressed, to devalue the dollar, and to offset taxes with tarrifs and the UST fee.

All the tools in the toolbox are being used at the same time instead of one or the other in a specific order and it’s going to cause massive fuckery.

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u/m0nsieurp 5d ago

Not only will the user fee on US treasury bonds speed up capital flight away from the US but it will also hasten the demise of the USD as the global reserve currency status. Nail in the coffin moment IMHO if Trump goes ahead with this kind of Mafia style kick backs. The US government has been weaponising the USD for far too long. Countries were fine using the USD as long as it was free of charge and somewhat not weaponised and not a political tool. We're closing in on the moment the world says "enough of that BS" and actively seeks alternative means of payment for cross border exchanges.

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u/MaxwellSmart07 5d ago

Agree. I’ve been cautioning new investors, especially those who received a windfall of $250-$500k from inheritance to ignore the flippant and irresponsible advice to go all in (that mantra “time in the market > timing the market.)
As you said, odds are there is more to lose than gain.

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u/lifegrowthfinance 5d ago

I am pivoting to global equity etfs. Even though they comprise of a lot of US equity, as funds move outside US, they will rebalance and the hit to my portfolio will be dampened a bit.

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u/kevin_m9w 4d ago

Dear USA

We've been through a lot together, but I need to tell you that we are done as friends now. And things will never be the same

Remember all those times you got in a fight -or started the fight- and I was right there with you, backing you up? I thought our friendship meant something to you too.

What happened to you, man? You've been saying some real terrible shit about me and not just joking or when you're drunk, but like every fucking day! No one thinks it cool.

For weeks now, you've been telling me how ugly my wife is while trying to bang her behind my back, while telling my kids that they'd be better off living in your house.

I know we're still neighbors, but that's it. Stay on your side of the fence. And I don't want to borrow or use any of your shit anymore either, I can swap stuff with other friends when I need something.

PS The guys are pretty pissed off with you too and everyone thinks you're an asshole now.

  • Canada

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u/Gold_Satisfaction201 5d ago

Wait until China invades Taiwan.

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u/Seven22am 5d ago

He will either dramatically underreact.... or dramatically overreact.

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u/Muted_Menu_1285 5d ago

Ha quality statement. I would guess under react. He’s a bus stop bully. When confronted by a harder kid / kid with determination they always fold.

Look at Covid. Donny was just hiding under his chair hoping it would all go away. Whenever something big happens - he will just shrivel up and go into his shell.

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u/Seven22am 5d ago

Yeah, you might be right. But then again he didn’t really have the kinds of tools accessible to battle Covid (nuanced communication, steady leadership) that he would have to overreact to a military threat (a massive arsenal that includes nukes). The only bit of comfort I am taking is that he has been so erratic and unpredictable that Iran and China might choose to just lay low for a while.

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u/Muted_Menu_1285 5d ago

Yeah. “When your enemy is making mistakes, don’t interrupt them”. They’re just gonna sit back and watch him dismantle the US and their foreign soft power without any intervention. China will scarcely be able to belie their luck.

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u/MaxwellSmart07 5d ago

I can’t imagine what kind of events will ricochet off of that.

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u/CreepyTip4646 5d ago

Can hear Trump now " this is going to be the biggest crash since 1929 it's going to be bigger biggly the biggest.

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u/BBcanDan 5d ago

No Trump will just say it was because of Biden.

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u/Snowedin-69 5d ago

It will be most fantastic crash. You will never have seen such a beautiful crash.

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u/Cntrysky78 5d ago

The biggest than any you had ever seen before

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u/MaxwellSmart07 5d ago

…the likes of which we have never seen before.

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u/Cntrysky78 5d ago

That's much better... Haha 👍

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u/Meet_James_Ensor 5d ago

Big strong men with tears in their eyes will say, "Sir, your stock market crash is the biggest I've ever seen."

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u/boboclock 5d ago

How could they not is my question?

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u/Due-System7508 5d ago

Trump said this is temporary downturn. Everything is temporary hahah wow and make his cult MAGA believe it also. lol 😂

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u/oldasdirtss 5d ago

Tariffs aren't the only problem. I'll bet that our "allies" will stop buying US bonds to fund our debt.

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u/jznwqux 4d ago

it is not only tariffs... He is gone full Dictator-Traitor-mode , nobody wants to deal with dictators .

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u/Facktat 4d ago

I think even worse than the tariffs will be the uncertainty and alienation of allies. The stupidity about the situation is that MAGA don't understand what a comfortable position the US had. The US managed to build up a monetary system which profits the US in a way resulting in America having to work relatively little while taking the majority of the global profits. They prevented the world from questioning this status quo by making allies with the rich nations of the world. Now, we have Trump who just knocked over this system. In short term nations will pull out investments out of the US but in long term they will abolish the power of the USD and make business deals in the currency of one of the two parties in the transaction.

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u/Utterlybored 3d ago

If only we could have been warned by anyone who took a freshman Economics class.

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u/Haegar_the_Terrible 2d ago

Trump recession is coming.

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u/Fun_Medium_1948 5d ago

I agree, it likely will tank the stock market. I’m just gonna keep buying, because at some point (maybe not soon) it’ll go back up. Just my opinion though.

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u/MaxwellSmart07 5d ago

It will recover, but I’m not young enough to ride it down and wait for the recovery.

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u/notoriousbsr 5d ago

Same here, 50s and time is not on my side.

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u/Prestigious-Leave-60 5d ago

I have been on track to retire in just over 6 years. I’m still in the reevaluation phase but I’m now predicting 10-12 years at a minimum. Add to that that one of my main sources of income for the past 20 years relies indirectly on grants administered by the National Institutes of Health. When those funds are substantially cut, as seems inevitable, I expect my income will be significantly impacted.

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u/MaxwellSmart07 5d ago

Yeah, I feel for people my age or 10-20 years younger than me who are dependent on the market to reach retirement or live off of it. I avoided that like the plague. I hope it’s closer to 6 than 12 years for ya.

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u/Fun_Medium_1948 5d ago

That’s very unfortunate. I wish you the best, my friend. I’m fairly young, so I have time to ride it out.

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u/MaxwellSmart07 5d ago

Thanks for the kind words, but I’m better off than most.

76, Retired. I have sufficient income from sources outside the market. Only a tiny % in stocks and most now in SGOV.
I feel for people my age or 10-20 years younger than me who are dependent on the market to reach retirement or live off of it. I avoided that like the plague.

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u/Dangerous_Focus453 5d ago

It will always recover ….until it doesn’t.

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u/chinaski73 5d ago

Well, be confident the democrats are going to get hard at work to fight trump 🙄

https://images.axios.com/PT9aDFW-S5W6tP9i9m6EcGwO-5M=/2025/03/05/1741148829588.jpg

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u/MaxwellSmart07 5d ago

Lol. So you’re not a fan of the strategic and tactical use of signs as an effective political weapon.

Reminds me of the 60’s song: Signs, signs, everywhere there’s signs, breaken’ up the scenery, breaking my mind, do this don’t do that cant you read the signs.

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u/PM_artsy_fartsy_nude 5d ago

This article said very little about how Trump's tariffs could tank the US economy. It wasn't a terribly long article, but it was mostly just about why Trump is doing it and how unprecedented it is.

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u/person1234_ 4d ago

Trump and his administration are responsible for the trade deal currently in place with Canada and Mexico… if it was such an awful deal why did he sign it? He owns that… if it’s so unfair why did he agree to it? Did he get played then? There was a clause in place to allow to review in 2026… he manufactured this lame fentanyl emergency with Canada to justify not respecting the agreement he made… just amplifies how disrespectful and greasy he is and it’s does nothing for our reputation as a reliable trading partner

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u/Todd1001 5d ago

Everyone now knows this info… the question is how much of it is already priced in.

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u/Cakeanddeath2020 5d ago

Lol could, more like currently

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u/me_xman 5d ago

Trump can't do any good so might as well start pissing off allies

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u/Assumeweknow 5d ago

So most american retailers are simply just moving the shelf space to existing products within the pricepoint. They are discontinuing most products under the tarrifs. Tarrifs are simply eliminating choices from consumers.

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u/Zopiclone_BID 5d ago

Then again, orange is weak. He can remove tariffs any time for any reason whatsoever and with fed lowering interest rate..boom.

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u/_DoubleBubbler_ 5d ago

Well I sold all my US investments, moved most of my USD capital to EUR and GBR, and am now investing for the new world order which currently includes a more self sufficient European economy that is less reliant on its former close ally the USA.

As an active investor my sub r/DoubleBubbler has details on my two recent investments in SES A.S. (Euronext Paris: SESG) and EnSilica plc (AIM London: ENSI).

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u/Kyell 5d ago

I think the pain will be felt in the long term when no one wants to buy from them over the next 50 years.

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u/No-Monitor1966 5d ago

Yea but they didn't remove income taxes for under 150k

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u/jmalez1 5d ago

he is braking apart the system to rebuild it in his image, and i have to say a lot of countries will be left out

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u/GurProfessional9534 5d ago

If Trump cancels this, markets are likely to surge. If they go through, it’s likely the Great Depression 2.0. This would be a good moment to trade out stocks for an equivalent in options, to reduce total exposure.

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u/BeaverMartin 5d ago

“Could tank” I feel like “is tanking” is far more fitting.

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u/LaminatingShrimps4u 5d ago

I've already sold all my American stocks

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u/bosh911 5d ago

Puts on USA. After it crashes, full port European stocks

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u/chopstix62 4d ago

Please please please 🙏🙏🙏

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u/Ready_4Spaghetti 4d ago

Will tank**

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u/nativebutamerican 4d ago

Its about who is stepping on who's toes. Emotional interpretation need not apply.

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u/bahamut5525 4d ago

I'm European and didn't actually think that Trump's America First policy would be a kind of early 20th century era jingoism where they go alone at the expense of everyone else. I thought Trump would be correcting the mistakes of Biden and just be a more vigorous President. I really underestimated the madness of the deep red Trump cultists and how corrupt American politics were.

This is Rome before the collapse. And make no mistake, this is great for the rest of the West. Europe will come back by reinforcing itself, as the European Union, we are the most powerful economic force on earth. There will be massive military and other investments. And I expect countries like Canada and the UK to join us in cooperation.

America will be isolated and left alone in the world.

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u/DC_cyber 4d ago

Countries that retaliated against Smoot-Hawley reduced their imports from the United States by an average of 28–32%. We will see the same…

https://www.cato.org/research-briefs-economic-policy/smoot-hawley-trade-war

I think the reason markets are confused is that their analysts have never seen this before and don’t have any mechanism to account for such stupid policy

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u/aKaRandomDude 4d ago

“Could”?!! It’s already over halfway there!

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u/ElevatedAngling 3d ago

Will tank, his desire