Trump's Tariffs Spark 9% USD Decline, 30% Consumer Confidence Drop

As the 100-day mark of the Trump administration approaches, the financial markets have given a negative evaluation of his "first 100 days" policies. The administration's actions, including imposing high tariffs on Canada and Mexico, signing executive orders for "reciprocal tariffs," and pressuring the Federal Reserve to lower interest rates, have sparked anxiety in the financial markets. The administration has also hinted at replacing Federal Reserve Chairman Jerome Powell, further exacerbating market concerns.

Ask Aime: What will happen to the stock market next week with Trump in charge?

The market's response has been clear: since Trump's inauguration on January 20th, the three major U.S. stock indices have shown significant declines, and the U.S. dollar index has fallen by nearly 9%. This is one of the most dismal starts for a U.S. president in the 21st century. The panic on Wall Street is gradually spreading to the real economy, with the University of Michigan's Consumer Confidence Index falling to its lowest level since August 2022 and declining by nearly 30% from its peak in December 2024. A significant number of companies in the S&P 500 have lowered their earnings forecasts for 2025, while only a small percentage have raised them.

Additionally, the LegalShield law firm reported that in the first quarter of 2025, the number of clients seeking bankruptcy advice reached its highest level since early 2020. The firm predicts that there may be a wave of bankruptcy filings this summer. European pension funds have also paused investments in the U.S., and the specter of recession is looming. The U.S. is losing its reputation as a safe haven for global capital, and Trump's trade war is making the U.S. an unsafe place for investment.

Ask Aime: How will the US economy perform under Trump's trade policies?

Under Trump's tariff policies, ordinary Americans are facing a wave of price increases. Due to rising operating costs, many sellers on platforms like amazon have started raising prices. A price analysis firm reported that since April 9th, the prices of nearly 1,000 products on Amazon have increased significantly, covering categories such as clothing, home goods, electronics, and toys, with an average price increase of nearly 30%. Multiple cross-border e-commerce platforms, including Temu and Shein, have announced price adjustments starting April 25th due to recent changes in global trade rules and tariffs.

Social media is filled with American users lamenting that the cost of their shopping carts has suddenly increased. The impact of tariff policies is being felt across almost all U.S. industries. pure Daily Care, a U.S. skincare company, reported that the cost of producing one of its skincare products jumped from $10 to $25 overnight. The company's co-founder, dave Dama, stated that products previously sold for $40, which yielded a profit of $7 to $8, are now unprofitable due to tariffs. The company plans to gradually raise prices for "must-have" products to avoid being demoted by Amazon's algorithm.

Many sellers are trying to extend the use of their existing inventory, hoping for a trade agreement to normalize relations. Meanwhile, shoppers will face fewer discounts and promotions as companies try to save as much profit as possible. The tariff policies are also expected to cause a significant increase in the price of basic, low-cost clothing in the U.S., adding to the expenses of some consumers. According to a report, 98% of U.S. clothing is imported, and the tariff policies could lead to a 65% increase in clothing prices and an 87% increase in shoe prices over the next year. Basic items like T-shirts, which are popular among low-income American families, will be particularly affected.

The tariff policies are also expected to cause supply chain disruptions. If the U.S. government maintains its current tariff policies, shortages of certain goods could occur in the U.S. within a few weeks. The number of cargo ships scheduled to arrive at the Port of Los Angeles has decreased by 33% compared to the same period last year. The U.S. Retail Federation predicts that if tariffs remain at their current levels, U.S. imports in the second half of the year could decrease by 20%. Low-cost shoes, clothing, toys, and some electronics are among the items most likely to disappear from U.S. shelves in the coming months. As the two major U.S. consumer seasons, back-to-school and winter holidays, approach, the supply of goods in the U.S. will face challenges, and consumers may not be able to find their desired items.

The tariff policies have also led to a lawsuit against the U.S. government. A U.S. company called "Teaching Resources" reported that it may have to pay $100 million in tariffs this year, an increase of nearly 44 times. The company filed a lawsuit in the U.S. District Court for the District of Columbia, alleging that the Trump administration's tariff policies are illegal and have caused their import costs to skyrocket, leading to a near-total halt in their import business. The company's CEO, Rick Waldenberg, stated that the tariffs have become unmanageable for any business, and the company has effectively stopped importing as a result. He also criticized the administration's attempt to use tariffs to bring manufacturing back to the U.S. as unrealistic, citing the company's failed attempts to produce locally over the past decade.

Waldenberg expressed his frustration with the government's disregard for the survival of small businesses and their arbitrary imposition of tariffs. He hopes that the court will issue an emergency ruling and that the case will eventually be heard by the Supreme Court. He believes that the tariffs lack proper authorization and that the situation is "upside down."