Mixed Day On Wall Street Amid Tariff Turmoil

 

 

 

 

 

Donald Trump sees an opportunity to “change the fabric” of the United States with his sprawling plan to institute new global tariffs — a policy that has had markets shaking for days while cracks form in his political coalition.

 

But even as the president, administration officials and key allies say he will not back down from his tariff plan, they are looking for ways to ease the concerns of wary supporters. The measures include talking up the potential to cut deals with key trading partners, pointing to tax cuts as a way to balance out the economic hit and deploying officials to speak to jittery business groups.  

 

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“The feeling among Hill Republicans is we’ve got to get rolling on the tax cuts right now,” a senior Senate Republican aide said. “We have to offer some candy to the business community in terms of offering them certainty and helping with pro-growth policies.”

 

Two administration officials confirmed that members of the administration were taking calls from business groups and setting up private meetings to allay worries. 

 

“The Trump administration maintains regular contact with business leaders, industry groups, and everyday Americans, especially about major policy decisions like President Trump’s reciprocal tariff action,” White House spokesman Kush Desai said in a statement. “The only special interest guiding President Trump’s decision-making, however, is the best interest of the American people — such as addressing the national emergency posed by our country running chronic trade deficits.”

 

The tariffs — which could quickly become the defining policy of his second term — put two core Trump identities in conflict: the protectionist who spent decades calling for steeper tariffs to combat what he sees as the country’s being ripped off by its trading partners, and the deal-maker, the persona he spent years building in New York real estate and as the protagonist of “The Apprentice.”

 

“Nobody but me would do this,” Trump told reporters Monday in the Oval Office. “You know, it would be nice to serve a nice, easy term, but we have an opportunity to change the fabric of our country. We have an opportunity to reset the table on trade.”

 

Allies push back

 

Markets have not been fans of resetting the table. The Dow Jones Industrial Average and the S&P 500 had smaller dips Monday as administration officials talked up dealmaking and a misleading headline briefly led investors to believe Trump was pausing the measures. Since Wednesday, when Trump announced his tariffs — which were calculated using a widely derided formula based on U.S. trade deficits with other countries — the Dow and the S&P 500 have both declined by more than 10%. 

 

Trump’s billionaire backers and business executives are sounding the alarm. On Monday, JPMorgan Chase CEO Jamie Dimon said Trump’s tariffs will weigh down the economy and raise prices. Bill Ackman, the outspoken Trump supporter and billionaire hedge fund executive, railed against the policies in a series of social media posts over the weekend, calling on Trump’s advisers to revise their tariff formula “before the President makes a big mistake,” suggesting all capital gains will be wiped out in 2025. Dave Portnoy, the founder of Barstool Sports and a vocal Trump supporter, readied for a turbulent day for markets Monday that he proclaimed “#orangemonday,” a not-so-thinly veiled shot at the president.

 

White House chief of staff Susie Wiles made at least one phone call over the weekend to an associate asking about the level of concern in the private sector about the market downturn, according to a person close to the White House.

 

Another member of the business community who seems displeased by Trump’s tariff agenda is Elon Musk, the billionaire CEO of Tesla and SpaceX who has been Trump’s right-hand man in rapidly slashing government programs and workers. Musk promoted free trade and went after Peter Navarro, Trump’s top trade adviser, saying Navarro “ain’t built s--t.” He also also laughed at at Commerce Secretary Howard Lutnick’s explanation for the administration’s placing tariffs on an uninhabited island.

 

A senior White House official, who insisted Trump’s team is not worried about cracks forming in the coalition, said, “Elon is entitled to his own opinion.”