Stocks Fall Hard On Tariff News

US President Felonious Punk couldn’t help himself this afternoon. “Tomorrow, tariffs — 25% on Canada and 25% on Mexico,” Punk said during a press conference at the White House. “And that’ll start. … What they have to do is build their car plants, frankly, and other things in the United States, in which case they have no tariffs.” While the tariffs had been anticipated for a couple of weeks, Mexico had been holding out hope that there might be some form of reprieve. Nope. Not a chance.

And how did the stock market react? Not nicely. At one point, the Dow Industrial Average fell over 800 points before pulling up enough to close down 650, or 1.48%. The broader S&P 500 fell 1.76% and the Nasdaq Composite, which hasn’t been positive since Punk took office, fell a whopping 2.64%.

Yes, this is bad. Very bad. In fact, you might want to check on the condition of your 401K if you still have one. Large market sell-offs like this hurt almost every major investment sector. With the tariffs starting tomorrow, neither country has any chance to adjust before being hit by the tax. Prices are likely to continue to trend downward for some time.

The VIX, Wall Street’s fear gauge, surged to its highest point this year. “Due to the uncertainty surrounding the tariffs, the stock market has erased the gains from the ‘[Punk] bump’ following the presidential election and the expected upward pressure on prices is giving investors pause,” said Gustavo Flores-Macias, a professor of government and public policy at Cornell University. When fear is driving the markets, investors are more likely to make severe and sometimes illogical moves in an attempt to recover what profit they can still find.

Commerce Secretary Howard Lutnick said at the press conference that global companies can avoid tariffs if they invest in production in the United States, like TSMC, the Taiwanese chipmaker at the White House on Monday to announce a $100 billion US investment. That doesn’t help companies that are already significantly invested and headquarter in the US, such as the Big Three automakers. When the ‘new’ trade agreement with Canada and Mexico was signed during Punk’s first administration, it was supposed to help avoid situations like this. Now, it’s domestic automakers that are likely to feel the most pain.

The yield on the 10-year Treasury slid to 4.16%, signaling concerns about uncertainty and future economic growth.

UK’s King Charles III met with Canadian Prime Minister Justin Trudeau earlier on Monday, particularly focusing on the ‘American problem’ of both tariffs and threats to the Commonwealth’s sovereignty. The King is under pressure to vocally support Canada and take a hardline stand against US provocations.

In the end, all this means higher prices for pretty much everything, especially out-of-season foods that Americans enjoy. If you haven’t stocked up already, you might want to do so tonight.