3 Warning Signs of Trump's Self-Destructive Actions
Trump's approval ratings remain solid at 47%, but his tumultuous start to his second term has sparked concerns among voters and markets. Here are three key indicators that his policies are backfiring:
1. Small Business Anxiety
The National Federation of Independent Business's (NFIB) confidence index plummeted in January after a temporary boost in December. Economist David Rosenberg attributes this decline to "policy-induced chaos" emanating from Washington. Trump's tariffs on Chinese imports, steel, and aluminum have raised costs and prices, weighing on small businesses.
2. Declining Voter Approval
According to Morning Consult, trust in Trump's handling of the economy has dwindled in recent weeks, dropping from 16 percentage points to 5 in net approval. Voters' primary concern is inflation, which Trump's executive orders have failed to address effectively. Avian flu has exacerbated egg shortages and price hikes, while tariffs are further expected to raise costs.
3. Inflation Fears
University of Michigan's sentiment index reveals that Americans anticipate inflation of 4.3% in 12 months, up from 2.7% pre-election. Tariffs are cited as a primary driver of this concern. Economists corroborate these fears, as tariffs have historically raised costs without offsetting benefits.
Despite these signs of erosion, some investors remain optimistic that Trump will moderate his threats if faced with adverse market reactions. However, the negative consequences are already evident in declining business confidence and consumer sentiment, suggesting that Trump's economic honeymoon is rapidly expiring.