We're suddenly talking about the Great Depression when discussing Trump's stock market

CNN

22-04-2025

Stocks are on the rebound Tuesday, bouncing back from another miserable day on Wall Street. But American financial markets are sounding all sorts of alarm bells that one day in the green can hardly overcome.
That's because investors have been sending a clear message: President Donald Trump's trade war is making America an unsafe place to invest.
We know this by looking at the broader markets and the assets that traders are buying and – let's face it – mostly selling.
Trump's stock market is throwing off some jaw-dropping statistics. How extraordinary? We're now making comparisons to the Great Depression.
The Dow Jones Industrial Average has tumbled 9.1% in the first three weeks of April, the 129-year-old index's worst performance for any April since 1932. The only other April that was worse: April 1931.
The broader S&P 500 has plunged 14% over the course of Trump's first term – the worst performance through April 21 for any president since records began in 1928, according to Bespoke Investments.
Even with a modest rebound on Tuesday – major indexes rose over 2% each – Trump has a long way to bounce back to avoid history. The next-worst start to a term for the US stock market in the first 63 days of trading was under former President Franklin Roosevelt in 1941, with a decline of just over 9%.
Meanwhile, traders have given up on the US dollar. During Trump's new term, the US dollar has fallen 5.5%, by far the record dating back to when data started being collected during former President Gerald Ford's term beginning in 1974. The only other presidential term for which the dollar started off even remotely close to this abysmal a start: Trump, during his first term, when the dollar fell 3% in the first 63 days of trading.
The dollar hit a three-year low Monday.
Typically, when investors get nervous, they pour money into the perceived safety of American Treasury bonds – historically the safe-haven assets to rule all safe-havens. But not this time: Government bond have sold off sharply. Yields, which trade in opposite direction to prices, have surged.
The 10-year US Treasury yield has risen to 4.4% just a month after it plunged below 4%. Bonds don't usually swing that quickly.
As traders have pulled money out of American stocks and bonds, they've been pouring money into investments around the rest of the world. The MSCI All World index, excluding the United States, has risen 2.9% over the course of Trump's new term. That's roughly on par with the start to former President Joe Biden's term and only slightly below Trump's first term – two periods when US stocks were also booming.
Fearful of a global recession, traders have sold off oil dramatically, giving US crude its worst start to any presidential administration since former President Bill Clinton's second term, according to Bespoke. Oil has fallen 19% during Trump's second term as traders worry that demand for travel and shipping will tumble. Oil fell nearly 24% during in the first few months of 1997, as Clinton started his second term.
Meanwhile, investors are looking for secure places to park their money. Among the best-performing assets is gold, which surged again Tuesday above $3,500 an ounce, hitting yet another record.
Gold has skyrocketed nearly 25% during Trump's new term, absolutely crushing the pervious record of 13.5% during former President Jimmy Carter's start to his term in 1977. No other president in the early days of their administrations has come close to matching Trump's recent gold boom.
Trump's trade war is sending the global economy into shock, the International Monetary Fund reported Tuesday.
'We are entering a new era as the global economic system that has operated for the last 80 years is being reset,' the IMF said in an alarming new report Tuesday that predicted rapidly slowing economic growth – particularly in the United States – while inflation is set to reignite.
That potentially disastrous combination of slowing growth and rising inflation is difficult to overcome. Although economists don't yet expect anything close to the so-called stagflation of the 1970s, the rapid reordering of global trade dynamics is causing tremendous confusion and unease among consumers, businesses and traders.
'The April 2 Rose Garden announcement forced us to jettison our projections,' the IMF noted, referring to Trump's 'Liberation Day' tariff announcement in which he imposed 10% across-the-board tariffs and announced punishing 'reciprocal' tariffs on dozens of countries that have since been paused for 90 days.
Goldman Sachs CEO David Solomon on CNBC Tuesday noted that the confusion around Trump's ever-changing policy has hurt business' ability to make necessary adjustments.
'The level of uncertainty is too high. It's not productive,' he said. 'It will have an effect on the growth of the economy, and we will see that, in my opinion, relatively quickly.'