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- Experts Slam Trump’s Tariff Plan as Economic “Nonsense”: Markets Plunge Amid Confusion Over Dubious Formula
Experts Slam Trump’s Tariff Plan as Economic “Nonsense”: Markets Plunge Amid Confusion Over Dubious Formula
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Less than 24 hours after former President Donald Trump announced sweeping new tariffs, financial markets have entered a tailspin — and leading economists are warning that the fallout has only just begun.
Trump’s latest round of tariffs, which he dubbed “Liberation Day” for the U.S. economy, appears to be having the opposite effect. Wall Street responded with the biggest market drop since the COVID-19 crash of March 2020, wiping out billions in market value and sparking widespread fears of a new recession.
According to The Wall Street Journal, U.S. stocks have suffered their steepest losses in nearly five years, and analysts point squarely at Trump’s policy announcement as the trigger.
What has stunned observers, however, is not only the scale of the tariffs but the mysterious and, according to experts, baseless formula used to justify them.
“It’s absurd,” one well-known trader reportedly said. “It shows a kindergarten-level understanding of international trade.”
Economists contacted by MSNBC described the formula behind Trump’s tariff strategy as “nonsense,” “cobbled together,” and completely unprecedented in economic literature. Greek letters were thrown into the math, seemingly to give it a veneer of legitimacy — but experts say it’s little more than pseudoscience dressed up in algebra.
“Nobody I spoke to in the field of international economics had ever seen this formula before,” said one correspondent. “It looks like it was made up on the fly.”
Despite repeated warnings from economic experts, and even from figures like Vice President Kamala Harris, Trump pressed forward with the tariffs, promising that they would bring prices down for American families. In campaign speeches, Trump pledged to “make America affordable again” and declared that prices would drop “starting on day one” of his return to office.
But the reality is starkly different.
Prices Set to Rise — Not Fall
From groceries to automobiles, beer to children’s toys, nearly every corner of the consumer economy is expected to be impacted. Economists estimate that the average American household could face thousands of dollars in additional costs annually as a result of the new import taxes.
Even as Trump touted relief for families at the checkout line, economists say the tariffs are already pushing prices higher.
“Firms are preemptively raising prices,” said Jared Bernstein, former Chair of the White House Council of Economic Advisers under President Biden. “And that’s before the tariffs even fully take effect.”
Tariffs on certain goods are expected to go into effect as soon as this week, with others following shortly after. The rapid timeline has left little room for markets or companies to adjust.
Moreover, the repercussions stretch beyond the checkout aisle. Bernstein warned that the new tariffs could have severe consequences for retirees and investors, particularly those outside the top 1%.
“A down market directly hurts people’s retirement prospects,” he said. “This isn’t just about beer and aluminum cans — it affects working-class Americans who can least afford it.”
A Threat to Jobs and Economic Growth
With growth forecasts already being revised downward, the looming specter of “stagflation” — stagnant growth paired with high inflation — is becoming a real concern. It's a scenario reminiscent of the 1970s economic malaise and one that could threaten recent years of steady economic progress.
“This is an own goal of epic proportions,” Bernstein noted. “They inherited a strong economy and are squandering it.”
The labor market, which has shown resilience in recent years, is also under threat. Economic advisors fear that the sudden spike in costs, along with the chilling effect on consumer demand, could lead to job losses and slow hiring across multiple industries.
“Companies are reacting quickly,” said Bharat Ramamurti, former Deputy Director of the National Economic Council. “They’re adjusting forecasts, pulling back investments, and in some cases freezing hiring. That’s the beginning of a contraction.”
A Businessman Without a Plan?
Perhaps most jarring is the dissonance between Trump’s brand as a “businessman president” and the chaos surrounding his economic decisions. Critics argue that while Trump projected an image of financial acumen, his latest move exposes a deep lack of understanding of macroeconomics.
“He always said he was good for business,” MSNBC’s Jen Psaki noted during her broadcast. “That’s why tech billionaires and Wall Street bankers backed him. But now even they’re in disbelief.”
With the stock market in freefall and consumer confidence shaken, the full consequences of Trump’s tariffs are still unfolding. But if early reactions are any indication, the backlash will be long-lasting — both politically and economically.
“This wasn’t supposed to happen,” Psaki said. “But it is. Because this time, people finally see through the illusion.”
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