Tariffs may spark US ‘market crash'
TDT | Agencies
American TV host and market commentator Jim Cramer has warned that the US could face a market crash reminiscent of the infamous 'Black Monday' of 1987 if President Donald Trump does not reconsider his sweeping tariff plan.
Cramer, a graduate of the renowned Harvard University with a doctorate in Law, and founder of TheStreet and CNBC host of the show 'Mad Money', highlighted the severity of the 1987 market collapse, which saw the Dow Jones Industrial Average plummet by 22.6% in a single trading session.
Speaking on his show, he drew parallels between the current market conditions and the historic downturn, cautioning that the market could be on the brink of another devastating fall.
'If the president doesn't try to reach out and reward these countries and companies that play by the rules, then the 1987 scenario… the one where we went down three days and then down 22% on Monday, has the most cogency,' Cramer stated yesterday. 'We will not have to wait too long to know. We will know it by Monday.'
Blanket tariff
On Wednesday, President Trump stunned the global economy by announcing a 10% blanket tariff on all imports to the US, with even steeper levies scheduled to take effect on April 9 against major exporters such as China, the European Union, Japan, and Vietnam.
China responded swiftly, imposing retaliatory tariffs in response to Trump's measures. The fallout was immediate, with the Dow Jones plunging 3,910 points over the following two days — marking the worst two-day loss since the COVID-19 pandemic.
Significant hit
The broader market also took a significant hit. The S&P 500 declined nearly 6%, while the tech-heavy Nasdaq recorded a similar drop.
The total market losses amounted to a staggering $6.6 trillion in erased value.
Although Cramer had initially backed Trump's tariff strategy, the dramatic downturn has led him to reconsider his support.
'If President Trump stays intransigent and does nothing to ameliorate the damage that I saw these last few days, I'm not going to be constructive here,' Cramer declared.
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