Bloodbath.
That’s the word analysts used to describe the market’s reaction to US President Donald Trump’s “Liberation Day” tariffs as Asian markets opened on Monday.
It’s the same term once used for “Black Monday” — the global stock market crash of October 19, 1987 — when an estimated $1.71 trillion was wiped out and the Dow Jones Industrial Average plunged 22.6%.
Now, analysts are warning that the world may be on the brink of a similar crash, as investors fret over the impact of Trump’s sweeping tariffs, fearing rising prices, weakened demand, and the looming threat of a global recession.
“Today’s market responses are leading some in China to speculate that we’ll remember this as another Black Monday,” Josef Gregory Mahoney, Professor of Politics and International Relations at East China Normal University, told TRT World.
Market analyst and CNBC host Jim Cramer also made this claim, warning that signs of panic are already apparent. After a tense weekend, markets woke up to pandemonium and chaos: Asian equity markets plummeted, European shares collapsed, and oil prices sank. Taipei’s stock market dropped 9.7% — its worst-ever single-day loss — while Hong Kong saw its sharpest fall since 1997.
This followed a tumultuous Friday, during which $5 trillion was erased from US markets. The Dow fell nearly 4,000 points, hitting the so-called “Mag 7” tech giants — Alphabet, Amazon, Apple, Meta, Microsoft, NVIDIA, and Tesla — particularly hard.
In retaliation, China announced it would impose a 34% levy on all US goods starting Thursday, a day after the American tariffs take effect. Beijing’s response stands in stark contrast to other countries that appear willing to yield to Washington’s demands — which China has slammed as “economic bullying.”
Trump sent global markets into a tailspin on April 2 by announcing sweeping new tariffs, including a 10% baseline on nearly all imports and steeper duties targeting China, the EU, and Vietnam.
He doubled down on the tariffs when speaking to reporters aboard Air Force One after spending the weekend playing golf in Florida.
"I don't want anything to go down. But sometimes you have to take medicine to fix something," he said on Sunday evening.
Will the “medicine” work?
Mahoney believes it will prompt a painful realisation, particularly in the Global South and parts of Europe — a shift away from a US-dominated financial order and toward a post-Bretton Woods era, in which China will be a source of stability, growth, and innovation.”
Professor Jian Gao of Shanghai International Studies University, and a Visiting Fellow at Tsinghua University’s China Forum, offers a grimmer view.
Referring to the tariffs as having “broken the basic cognitive model of professional scholars”, Professor Gao told TRT World that the imposition of additional tariffs “will ultimately result in no winners; it is a self-harming act”, ultimately completely ending the “international economic order led by the United States”.
“For the past century, the greatest public good the United States offered the world was an open market,” Gao told TRT World. “If the US embraces trade protectionism, it’s effectively rejecting the free trade system it once championed.”
The US’s own experts and billionaires agree, slamming Trump’s move as lacking sophistication, ultimately leading to a “self-induced, economic nuclear winter”.
“We are in the process of destroying confidence in our country — as a trading partner, as a place to do business, and as a destination for investment,” wrote billionaire hedge fund manager Bill Ackman, himself a Trump supporter, in a post on X.
With grumblings of discontent coming from Trump’s own supporters and the business elite and markets set for a turbulent week, the possibility of the tariffs being revoked are growing.
