Bitcoin price today: surges to $122k, near record high on US regulatory cheer
Investing.com -- The two-day thrashing of the stock market post-tariffs has wiped out $6.6 trillion in wealth in the U.S. alone. The Dow is down 9.3%, and the S&P 500 is down 10.5% over the two days. The NASDAQ has dropped 11.4% and has now entered bear market territory, with an overall decline of over 20% from recent highs.
Despite the bloodbath, President Trump has urged Americans to “hang tough”, claiming “we will win.”
Trump’s 10% base tariff went into effect on Saturday at 12:01 AM ET, while the harsher country-by-country reciprocal tariffs go into effect on April 9th.
Under the plan, China will be hit with a fresh 34% tariff on imported goods. This is on top of the current 20% levy on the country, bringing the effective rate to 54%. Among other large exporters to the U.S., Vietnam will be hit with a 46% reciprocal tariff, the EU will be hit with a 20% tarrif, Taiwan 32%, Japan 24%, and India 26%. In total, more than 180 countries are on the list.
China has already retaliated with a 34% tariff on U.S. imports; others may follow soon. Vietnam may have capitulated early, with Trump announcing Friday that he had a constructive talk with the country’s leader and they have asked for zero percent tariffs.
Companies like Apple Inc (NASDAQ:AAPL), which rely heavily on foreign manufacturing, have plunged. Apple lost $533 billion in market value over the two days. Analysts estimate the new tariffs could cost Apple $40 billion in lost profits annually or force the iPhone maker to raise prices, which could weigh on demand.
Despite months of pricing in the tariffs, markets were caught off guard by the size of the tariffs, which don’t correlate directly to tariffs charged by other countries. The Trump administration said the newly announced tariffs include currency manipulation and other trade-reducing taxes, such as VAT in Europe. However, some economists believe the tariffs may be tied directly to trade imbalances other countries have with the U.S.
Despite the market sell-off, rhetoric from Trump and others in his administration suggests he will not be backing down from his hardline stance.
“Only the weak will fail,” Trump posted on social media on Friday as markets were in freefall. He followed that up with comments after the close that “big business is not worried about the Tariffs” and are instead focused on making a “big deal.” Elsewhere in the administration, Treasury Secretary Scott Bessent went so far as to blame the market sell-off on China’s DeepSeek versus the tariffs. Meanwhile, Secretary of State Marco Rubio tried to reassure Americans, saying economies didn’t crash, only markets in anticipation of a new world order.
On Saturday, China declared that “the market has spoken” and rejected Trump’s tariffs.
While Americans may discount comments from the communist country, many Trump supporters have expressed the same sentiment and are worried about more pain ahead.
Senator Ted Cruz, an ardent Trump supporter, has questioned the tariff policy, calling it a tax on U.S. consumers and “super risky.” Another strong supporter, Senator Rand Paul, warned that the tariffs are not only financial suicide but also political suicide. Paul warned that “when McKinley put tariffs on in 1890, they lost 50 percent of their seats… When Smoot-Hawley put their tariffs in the early 1930s, we lost the House and Senate for 60 years.”
In addition to potentially making goods more expensive in the U.S., the tariffs threaten to put the U.S. economy into a recession. On Friday, economists at JP Morgan warned that the tariffs will bring 2025 annual GDP growth in the U.S. to a negative 0.3%, down from its previous forecast of growth of 1.3%. The negative wealth effect from a declining stock market is another concern among economists.
Overall, Trump doesn’t appear to be backing down from his hardline stance on tariffs. While this could be a negotiating tactic, the pain for Americans’ retirement accounts is real. There are worries that the selling could also beget more selling as leveraged positions are unwound. With buyers on strike, there is a risk that a bottom may not be found until Trump relents on his strict tariff policy. It appears that Trump is playing chicken with the market. Who will blink first?