Markets Go Haywire Amid Bogus Rumor That Trump May Pause Tariffs

After spending a weekend of panic over the economic impact of President Donald Trump’s tariffs, the New York Stock Exchange continued to crater on Monday — before spinning into chaos amid a false rumor that Trump may pause the tariffs.

Within minutes of opening, the Dow Jones dropped over 1,500 points, the NASDAQ dropped over 4.5 percent, and the S&P 500 plunged 4 percent. The drop on Monday is the S&P’s biggest three-day crash since October of 1987 and is set to enter a bear market — the first since the Covid-19 pandemic — if the losses hold.

The markets then fluctuated wildly as rumors swirled that Trump was considering a 90-day pause on the tariff regime. It’s unclear where the rumor about Trump considering a pause actually started, though. “Walter Bloomberg,” a verified, widely followed social media account wrote, “HASSETT: TRUMP IS CONSIDERING A 90-DAY PAUSE IN TARIFFS FOR ALL COUNTRIES EXCEPT CHINA.” The account cited Reuters, which did indeed report that Hassert said on Fox News that Trump was considering a pause. Reuters later updated its story to note that CNBC was the first to report the possible pause. A CNBC host did indeed report on the air that Hassert said Trump will consider at 90-day pause — but prefaced it by saying, “I think we can go with this headline.” Another host said, “We’ll try to source that exactly.”

Trump economic adviser Kevin Hassett said no such thing, though. He was asked during an appearance on Fox & Friends earlier on Monday if Trump would consider a 90-day pause. “I think the president is going to decide what the president is going to decide,” he responded, before noting that countries are negotiating with Trump.

CNBC White House correspondent Eamon Javers later pushed back on the idea that a pause was coming, telling the network that “nobody [in the West Wing] is aware of any plans for any kind of 90-day pause, at least right now. Officials in the West Wing are checking to find out if this is an accurate report, but no information and no confirmation,” at this time. Javers added that “in the West Wing there’s real confusion […] on this point in terms of whether or not Hassett is talking about something that’s about to be announced, is being contemplated.” 

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The White House then doused the rumor in cold water itself. “Wrong. Fake News,” it wrote in response to the idea that Trump may pause the tariffs.

The markets then continued their downward plunge after spiking briefly amid the rumors that a pause was coming.

On Sunday night, Asian stock exchanges were battered by anxiety over the impending penalties on goods exported to the United States. The Hong Kong Hang Seng Index dropped 13.22 percent, and the MSCI Asia Pacific Index fell 8.5% — the biggest selloff for the index since the 2008 financial crisis. 

Japan’s Nikkei 225 and China’s CSI 300 both lost over 7 percent of market value. Taiwan’s Weighted Index plummeted 9.7 percent, the worst single drop in its recorded history. European markets all took major hits, in the range of 4-5 percent.

In the United States, investors watching the global selloff over the weekend braced for the market opening on the East Coast, with major stock futures dropping about 2 percent between Sunday night and early Monday morning. 

Traveling back to Washington, D.C., from a golf trip in Florida on Sunday, Trump told a reporter who asked if there was a level of decline in the markets that would make him reconsider his tariff policies that her question was “stupid.”

“I don’t want anything to go down, but sometimes you have to take medicine to fix something,” he said. 
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Trump has been posting through it on social media. He claimed on Truth Social on Monday: “Oil prices are down, interest rates are down (the slow moving Fed should cut rates!), food prices are down, there is NO INFLATION, and the long time abused USA is bringing in Billions of Dollars a week from the abusing countries on Tariffs that are already in place.” 

While crude oil prices are down, such drops are typically considered a sign of a recession or periods of economic instability. Food and grocery prices have not seen a significant decrease and are actually expected to increase as tariffs go into effect. 

Trump continued to defend his economic agenda, even as Americans worry that large swaths of their savings and investments will be wiped off the map. “Don’t be Weak! Don’t be Stupid! Don’t be a PANICAN (A new party based on Weak and Stupid people!),” he wrote. “Be Strong, Courageous, and Patient, and GREATNESS will be the result!”
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JP Morgan Chase recently raised its odds that the U.S. will enter a recession to 60 percent, while Goldman Sachs raised its odds of a recession to 45 percent.

A recession brings with it a whole spectrum of devastation. Unemployment, job loss, home loss, debt, foreclosure, and a whole host of social health problems. The rich, like the president, tend to make it out all right, while everyone else will bear the weight of Trump’s hubris. His vague promise of “GREATNESS” may not be enough to justify their losses.