When President Donald Trump wanted to make the case for his first term\u2019s success in an interview last month, he turned to the stock market. <\/p>\n\n\n\n
\u201cI was very proud to have handed over the country when the stock market was higher than it was, previous to the pandemic coming in,\u201d he said in a Fox News i<\/a>nterview<\/a> Feb. 9. \u201cIt was an amazing achievement.\u201d<\/p>\n\n\n\n And in his second term, he has promised that trend would continue.<\/p>\n\n\n\n \u201cThe stock market is going to be great,\u201d he told<\/a>\u2002the crowd<\/a> at an investor conference Feb. 19.<\/p>\n\n\n\n But after stocks began a downward spiral last week on fears Trump’s use of tariffs will tip the United States into a recession, his tone has changed.<\/p>\n\n\n\n \u201cYou can\u2019t really watch the stock market,\u201d Trump said in an interview<\/a>\u2002that aired Sunday\u2002<\/a>on Fox News. \u201cIf you look at China, they have a 100-year perspective. We have a quarter. We go by quarters.\u201d<\/p>\n\n\n\n On Monday, stocks sank further<\/a>, erasing all of their gains since Trump\u2019s election. The S&P 500 had <\/strong>its worst day since September, and <\/strong>shares of technology companies were among the hardest hit as the Nasdaq had its biggest one-day drop since 2022, wiping <\/strong>out $1 trillion in value. <\/p>\n\n\n\n None of the more than two dozen posts on Trump\u2019s Truth Social account Monday addressed the market sell-off. A White House official downplayed the market moves in a statement to reporters.<\/p>\n\n\n\n \u201cSince President Trump was elected, industry leaders have responded to President Trump\u2019s America First economic agenda of tariffs, deregulation, and the unleashing of American energy with trillions in investment commitments that will create thousands of new jobs,” White House spokesman Kush Desai said <\/strong>in a statement. “<\/strong>President Trump delivered historic job, wage, and investment growth in his first term, and is set to do so again in his second term.\u201d<\/p>\n\n\n\n The White House cited s<\/a>everal s<\/a>urveys<\/a> showing improved confidence among <\/strong>business leaders, though the surveys were conducted before Trump imposed the tariffs on Canada and Mexico last week.<\/p>\n\n\n\n After Trump\u2019s first term in office, he frequently used the stock market like an EKG tracking the health of his presidency with\u2002<\/a>pos<\/a>t<\/a>s<\/a>\u2002like<\/a> \u201cStock Market at all-time high. That doesn\u2019t just happen!\u201d At rallies, he would often cite the market and talk about workers\u2019 thanking him for making them rich because their stock portfolios <\/strong>were <\/strong>doing so well. <\/p>\n\n\n\n While the stock market had its ups and downs during Trump\u2019s first term, including a dramatic fall at the start of the pandemic, it was largely on an upward trajectory, with the S&P 500 index increasing nearly 70% during Trump\u2019s first term. The market continued its overall rise during President Joe Biden\u2019s time in office. <\/p>\n\n\n\n On the eve of Trump’s <\/strong>inauguration, when the S&P 500 was up around 3% since the election, he <\/strong>referred to the increase in stocks, along with other improvements in the economy, as the \u201cTrump effect.\u201d<\/p>\n\n\n\n \u201cEveryone is calling it the \u2014 I don\u2019t want to say this, it\u2019s too braggadocious, but we\u2019ll say it anyway \u2014 the Trump effect. It\u2019s you. You\u2019re the effect,\u201d Trump said at a rally with supporters. \u201cSince the election, the stock market has surged, and small-business optimism has soared a record 41 points to a 39-year high. Bitcoin has shattered one record high after another.\u201d<\/p>\n\n\n\n But as Trump\u2019s policies have begun to take shape in his first 50 days in office, some of that optimism from investors has reversed course. The decline in markets accelerated last week, when Trump carried through on a threat to impose a 25% tariff on goods from Canada and Mexico, two of America\u2019s closest trading partners, and put an additional 10% tariff on imports from China. <\/p>\n\n\n\n While Trump backed off\u2002<\/a>on many of the Canada and Mexico tariffs days later, the levies remained on many products, and he reiterated that more tariffs were coming in April. On Monday, China imposed retaliatory tariffs on a variety of U.S. agriculture products, while <\/strong>O<\/a>n<\/a>tario\u2019s premier a<\/a>n<\/a>n<\/a>ounced<\/a> the province would begin charging 25% more for electricity to 1.5 million Americans.<\/p>\n\n\n\n U.S. tariffs on imported steel and aluminum were set to go into effect later this week, which would drive prices higher for some U.S. manufacturers. <\/p>\n\n\n\n \u201cThe underlying fundamentals of the economy are really strong. There is unfortunately a huge amount of uncertainty right now that is affecting boardrooms and investors,” Peter Orszag, CEO of the <\/strong>investment bank Lazard and a top budget official in the Obama administration, said<\/a>\u2002<\/strong><\/a>in an interview on CNBC<\/a>. “I think people could understand tension with China. It\u2019s Canada, Mexico and Europe that is confusing. So the good news is this is a choice.”<\/p>\n\n\n\n Trump hasn\u2019t dismissed the notion of some economic pain from his tariffs, warning that there will be a \u201cperiod of transition<\/a>\u201d in his interview Sunday on Fox and a \u201clittle disturbance\u201d in his address to Congress last week.<\/p>\n\n\n\n His top economic officials also offered a warning last week, with Treasury Secretary Scott Bessent saying there would be<\/a> a \u201cdetox period\u201d as the economy shifts away from government spending and Commerce Secretary Howard Lutnick saying prices on some items would go up as a result of tariffs \u2014 though they wouldn\u2019t increase overall inflation.<\/p>\n\n\n\n On Sunday, Trump maintained his position on the tariffs in remarks to reporters as he flew back to Washington from a weekend at his home in Palm Beach, Florida. <\/p>\n\n\n\n \u201cI think the tariffs are going to be the greatest thing we\u2019ve ever done as a country,\u201d Trump said. \u201cIt\u2019s going to make our country rich again.\u201d<\/p>\n\n\n\n