As stock markets continue to fall globally from President Trump’s latest round of tariffs, financial experts said they’re focused on keeping their clients calm as they watch their savings and 401(k) retirement accounts shrink.
Early Monday morning in Japan, the Tokyo stock market started plunging, falling eight points right from the opening bell. The Japanese Nikkei is often a precursor to what’s going to happen globally. For some, they’re worried of a repeat of 1987’s Black Monday, when the Dow fell more than 22% in a single day.
Worried about recession
“Spoken to a lot of neighbors, all sorts of career backgrounds, and the one thing is pretty universal, which is they’re worried about recession,” said Michael Armstrong, president of the Armstrong Advisory Group.
Armstrong said concerns were sparked last Wednesday after President Trump announced sweeping tariffs of at least 10% on goods imported from other countries.
“The promise of the Trump administration that they seem to be making is we want to manufacture many new goods and stuff that used to be manufactured in the United States here again,” said Armstrong.
Armstrong said the tax for other countries comes at a cost for Americans too.
“The problem seems to be that in order to do that, they are more than willing to cause a recession,” said Armstrong.
The announcement of import taxes last week prompted a sharp drop in the U.S. stock market. Thursday and Friday were the worst two days on Wall Street since the pandemic.
“It is looking fairly ugly out there,” said Armstrong. “These are the most nerve-wracking times, I think, for investors.”
Repeat of 1987’s Black Monday?
The decline has also affected people’s 401(k) retirement accounts and as the new week begins, there’s concerns of another Black Monday crash.
“I don’t love the comparisons because that was a really, really ugly day,” said Armstrong. “My point is, I don’t think anyone really knows, precisely, what is going on or what’s going to happen next because these are policies that we literally haven’t seen from the United States in the modern era.”
Armstrong said the best advice he can give his clients is to take a break from the TV because as it looks right now, things may get worse before they improve.
