Trump's tariff hikes trigger global market turmoil: "Businesses have no choice but to curtail investment and fire workers," says Bill Ackman

American stock markets saw large drops after President Trump's latest declarations about raising tariffs. As reported by NBC News, the S&P 500 index fell by 2.8%, Nasdaq by 3.7%, and the Russell 2000, which tracks smaller company stocks, by 3.7%. Turmoil was also felt in Asian markets.

In Japan, the Nikkei 225 and Topix indices fell by over 8%, which temporarily halted trading in accordance with local regulations. After reopening, the Nikkei dropped over 6%, and Australia's S&P/ASX 200 decreased by 5.3%. Even Bitcoin, which had previously resisted declines, lost 5.6%. Additionally, another key reference point—the price of a barrel of crude oil—fell by 3.7%, to just under $60 per barrel. This is the lowest level since April 2021.

President Trump announced increased tariffs on goods from China and other countries, which is expected to bring billions of dollars to the United States. "THIS IS AN ECONOMIC REVOLUTION, AND WE WILL WIN. HANG TOUGH," Trump wrote on Truth Social. "We have massive Financial Deficits with China, the European Union, and many others. The only way this problem can be cured is with TARIFFS, which are now bringing Tens of Billions of Dollars into the U.S.A. They are already in effect, and a beautiful thing to behold. The Surplus with these Countries has grown during the "Presidency" of Sleepy Joe Biden. We are going to reverse it, and reverse it QUICKLY. Some day people will realize that Tariffs, for the United States of America, are a very beautiful thing!" assured the US President.

The introduction of tariffs aims to reduce the US trade deficit. However, in light of further market declines, economists and businesspeople are critiquing it. NBC News recalls that even Elon Musk criticized the tariff policy, which was met with a response from Trump's advisor, Peter Navarro, who claimed the billionaire is doing so to protect his interests.

Tesla and SpaceX have already reacted to the adverse effects of tariffs on the American economy. Both Musk-owned companies sent a letter to the US trade representative warning about the impact of tariffs and retaliatory measures on their financial performance.

"What CEO and what board of directors will be comfortable making large, long-term, economic commitments in our country in the middle of an economic nuclear war? I don’t know of one who will do so. When markets crash, new investment stops, consumers stop spending money, and businesses have no choice but to curtail investment and fire workers," predicts Bill Ackman, CEO of the Pershing Square investment fund. And he adds that the United States is heading towards an 'economic nuclear winter'.

Goldman Sachs analysts wrote over the weekend that "tariff pandora's box has been opened." They added that US actions against China were "much stronger than our economists and most investors anticipated." Analysts predict the new tariffs could set back the American tech industry by a decade. Dan Ives of Wedbush Securities lowered forecasts for Tesla's stock by 43% and Apple by 23%. JPMorgan also warned about rising unemployment and a decline in consumer spending.