Happy Thursday! Five years ago today, as COVID-19 made its way to the United States, TMD covered President Donald Trump’s alarming address to the nation about the fast-spreading virus. “The speech itself was riddled with serious errors,” we wrote at the time. Oh, how things change—and don’t. 

Quick Hits: Today’s Top Stories

• President Donald Trump on Wednesday implemented 25 percent tariffs on all steel and aluminum imports to the United States, prompting swift countermeasures by affected countries. Canada, America’s largest trade partner, announced plans to impose a 25 percent reciprocal tariffs on $20 billion worth of U.S. goods starting today. The European Union, meanwhile, said new levies on $28 billion worth of American exports—including beef, bourbon, and motorcycles—will take effect beginning on April 1. “In the meantime, we will always remain open to negotiation,” European Commission President Ursula von der Leyen said Wednesday. “Tariffs are taxes. They are bad for business, and even worse for consumers.”
• Russia is awaiting “detailed information” from U.S. officials before it agrees to the American proposal for a 30-day ceasefire in Ukraine, Kremlin spokesman Dmitry Peskov said Wednesday. The noncommittal response comes ahead of U.S. special envoy Steve Witkoff’s upcoming visit to Moscow, where he is expected to push Russian President Vladimir Putin to accept the Ukraine-supported deal to temporarily freeze fighting along the current front lines. “It’s up to Russia now,” President Trump said from the Oval Office. Meanwhile, the Ukrainian foreign minister said Wednesday that U.S. weapons shipments through Poland had resumed.
• The consumer price index rose 0.2 percent month-over-month and 2.8 percent annually in February, the Bureau of Labor Statistics reported Wednesday, down from 0.5 and 3 percent in January, slightly lower than economists’ expectations. The data will likely keep the Federal Reserve on track to resume cutting interest rates in June. But even as inflation shows signs of cooling, economists warned about looming price rises as U.S. tariffs take effect.
• Senate Minority Leader* Chuck Schumer, a New York Democrat, said Wednesday that his conference wouldn’t support a Republican-backed bill that would fund the government into the fall. The funding plan, which was passed by the House on Tuesday, needs at least eight Democratic votes to make it through the upper chamber. Ahead of the Friday deadline to avoid a government shutdown, Schumer instead called for a one-month stopgap measure to allow for continued negotiations. 
• President Trump plans to name Michelle Bowman, a Federal Reserve board member, to serve as the next vice chair for supervision at the central bank, multiple outlets reported Wednesday. If confirmed by the Senate, Bowman is expected to usher in a lighter approach to financial regulation as the Fed’s top bank watchdog. Her nomination follows Michael Barr’s decision to step down from the job late last month.
• Sen. Jeanne Shaheen of New Hampshire, the top Democrat on the Foreign Relations Committee, announced Wednesday that she will not seek reelection in 2026, setting up a competitive race for the purple state’s seat. Republicans currently hold a 53-47 majority in the upper chamber; Shaheen’s departure and other planned retirements leave three seats vulnerable to Republican challengers next year, further complicating Senate Democrats’ path to regaining a majority.

From ‘Bidenomics’ to ‘Trumponomics’

When voters went to the polls in November, the economy loomed large. Donald Trump had for months sought to tie the Democratic administration’s runaway spending to the high prices plaguing American consumers, and the strategy succeeded. “We will be a rich nation again,” the president declared during his inaugural address.

But now, as a brewing trade war wreaks havoc on the stock market, the very issue that propelled Trump to victory threatens to derail the early days of his presidency. Asked by Fox News’ Maria Bartiromo on Sunday whether the U.S. can expect a recession this year, the president demurred: “I hate to predict things like that,” he said. “There is a period of transition, because what we’re doing is very big.”

A day later, Wall Street suffered its worst showing of the year, with the S&P 500 falling 2.7 percent and the Dow Jones Industrial Average dropping 2 percent. The Nasdaq composite took an even heavier hit, sliding 4 percent to record its worst day since 2022. The nearly across-the-board rout was somewhat checked by positive unemployment and inflation reports for February—the first full-month economic metrics of Trump’s second term. But as the president presses forward with a protectionist economic agenda, economists warn that the figures could belie the impending fallout of the aggressive tariffs. 

For now, the White House has gone from predicting a near-instant economic takeoff to making the case for delayed gratification. “Markets are going to go up and they’re going to go down but, you know what, we have to rebuild our country,” Trump said Tuesday. “We’re in this difficult transition from Bidenomics to Trumponomics,” White House trade adviser Peter Navarro said Wednesday. 

As the stock market recorded a turbulent week, other economic data released this month have given the administration reason for guarded optimism. The Bureau of Labor Statistics’ February jobs report, released on March 7, showed that the American economy added 151,000 jobs that month—lower than economists’ expectations but exceeding job gains in January. Unemployment ticked up slightly from 4 percent to 4.1 percent, while the labor force participation rate remained relatively unchanged at 62.4 percent.

February’s inflation report, published Wednesday, also showed a relatively stable economic situation. The consumer price index, which measures a “basket” of common goods and services, rose 0.2 percent month-over-month and 2.8 percent annually in February, the Bureau of Labor Statistics reported Tuesday, down from 0.5 and 3 percent in January. “Core” inflation, a metric that leaves out volatile food and energy prices, increased 3.1 percent annually—the slowest pace since April 2021. 

The limited economic data from Trump’s time back in office seemed to defy predictions of imminent economic catastrophe. “Even if the liberal story were true, it’s just too early,” Justin Wolfers, a professor of public policy and economics at the University of Michigan, told TMD.

What, then, explains the apparent disconnect between a stock market that seems to be on the verge of panic and the fairly robust hard numbers? Put simply, official statistics are backward-looking, while stocks project future performance. 

And as investors look ahead, an unpredictable U.S. economic policy—marked by a wide-ranging tariff regime targeting America’s top trade partners—is spooking Wall Street. “A stock is equal to the net present value of a company’s future earnings, so it’s literally looking forward over the next 100 years,” Wolfers explained. When a particular stock drops in price, it’s an indication that investors are no longer as confident in that company’s future. And despite being buoyed slightly by the positive inflation report on Wednesday, the stock market shows no signs of stabilizing as Trump’s trade war begins in earnest. “The stock market definitely was positioned for Trump 1.0, where you get all the tax cuts and the tariff stuff is just bluster,” Brendan Walsh, a principal at Markets Policy Partners, told TMD. “Wall Street just completely dismissed the tariff reality, and that reality is what’s [now] happening.” 

New tariffs may finally be a reality, but trying to determine the exact contours of the Trump administration’s trade regime is still giving analysts whiplash. Originally scheduled to take effect on February 4, planned 25 percent tariffs on imports from Canada and Mexico were postponed until March 4. A day after they went into effect, Trump announced an exemption for the auto industry. Then, on March 6, he declared that all goods covered under the U.S.-Mexico-Canada Agreement would be exempt from tariffs until April 2. Then, on Wednesday, Trump imposed 25 percent tariffs on all steel and aluminum imports to the United States.

Even if the tariffs are eventually walked back, the uncertainty they sow among investors can cause harm in and of itself. “When people get uncertain, they keep their hands in their pocket,” Michael Farr—the CEO of Farr, Miller, & Washington, an investment advisory firm—told TMD. “Wall Street hates uncertainty.”

U.S. trade partners have also begun to retaliate for the measures. On Wednesday, the European Union announced duties on up to $28 billion worth of American goods in response to U.S. metal tariffs, targeting a range of U.S. products, from steel and aluminum to meat, bourbon, and motorcycles. The countermeasures are set to take effect beginning April 1. Canada also responded to the steel and aluminum tariffs, putting levies on roughly $21 billion of U.S. imports effective today. 

For the thousands of U.S. businesses that depend in some way on cross-border trade, planning for the future has become exponentially more difficult. Many are declining to make business investments: As the trade war threatens to further disrupt supply chains, sectors like the auto industry are unable to plan years or even months ahead. “The collective impact in the short run is that people are pausing, they’re pulling back,” Larry Fink—the CEO of BlackRock, the world’s largest asset manager, told CNN Wednesday. “Talking to CEOs throughout the economy, I hear that the economy is weakening as we speak.”

And, as tends to be the case with tariffs, consumers are likely to bear the costs. Many firms have already begun raising prices: Masco, an American manufacturer of home improvement and construction products, announced a 9 percent price increase for its plumbing equipment, which is often sourced from China. Both Target and Best Buy’s CEOs said this week that they would likely have to raise prices at their stores to make up for the increased price of imported goods. 

The administration’s protectionist agenda, together with fears of a recession, have Americans souring on the president’s economic approach. A recent Reuters/Ipsos poll found that a majority of Americans, including one in three Republicans, believe Trump’s economic maneuvers are too “erratic.” In a new CNN/SSRS poll from Wednesday, meanwhile, 56 percent of respondents said they disapproved of Trump’s handling of the economy—the president’s highest economic disapproval rating to date, including during his first term. 

But whether pessimism from Americans and investors signals an imminent doom spiral is far from certain. “Economies don’t move on a dime,” said Wolfers. “The stock market is much less optimistic about the future of the American economy, but that could be anywhere from next month to 50 years’ time.”

Today’s Must-Read

Toeing the Company Line

Worth Your Time

• In an essay for Quillette, Saul Zimet debunks the the zero-sum idea that the future thriving of human beings is inherently at odds with the preservation of wildlife. “The truth is quite different. In the long run, the dangers of disordered nature are so pervasive, and humanity’s potential solutions so indispensable, that advancing human wealth and economic flourishing is necessary, not detrimental, if we want to protect wildlife and maintain or even increase biodiversity,” he wrote. “Attempts to conserve Earth’s current ecosystems through non-intervention are doomed because change is a constant of nature and environmental change is a constant of Earth’s geology. Plus, in addition to being futile, it is pessimistic to think that mere conservation should be the highest hope of a forward-looking environmentalist movement. Human non-intervention may benefit non-human life in an unsustainable, short-term way. But acting in the long-term interest of Earth’s wildlife means protecting species from exogenous existential threats and investing in technological and scientific advances that will enable them to thrive at unprecedented levels.”

Presented Without Comment

BBC: Amazon Forest Felled to Build Road for Climate Summit

Also Presented Without Comment

The Hill: RFK Jr. Says Trump ‘Lost 30 Pounds’ Even With All the ‘Crap That He Eats’

In the Zeitgeist

Netflix premiered its latest live offering, a talk show featuring comedian John Mulaney, to mixed reviews yesterday. The late-night series, which will feature a variety of celebrity guests, is set to run weekly for 12 episodes.

Let Us Know

What are your main economic concerns about Trump’s tariffs?

Correction, March 13, 2025: Chuck Schumer is the Senate’s minority leader, not majority leader.