Treasury Secretary Scott Bessent says Trump has individual investor confidence

Treasury Secretary Scott Bessent said Tuesday that individual investors, who have been holding their positions amid the recent market drop, have faith in President Donald Trump’s trade levies. He also noted that individual investors held tight while institutional investors panicked due to tariffs.

Donald Trump acknowledged that his levies are meant to benefit the U.S. economy over the long term. According to him, the cost of the tariffs will spur both U.S. and foreign businesses to expand in the U.S., spawning jobs for American workers and boosting the U.S. manufacturing sector.

Bessent believes individual investors have faith in President Trump

BESSENT: RETAIL IS BUYING THE DIP, THEY TRUST TRUMP EVEN IF INSTITUTIONAL INVESTORS DON'T

— amit (@amitisinvesting) April 29, 2025

The Treasury Secretary has revealed that individual investors, who have been largely holding their positions through the recent market tensions, are confident in President Donald Trump’s tariff policy.

The former hedge fund CEO cited a Washington Post story that revealed Vanguard,  one of the largest money management firms in the U.S., said that 97% of Americans haven’t done a trade in the past 100 days.

“Individual investors have held tight, while institutional investors have panicked … individual investors trust President Trump.”

-Scott Bessent, U.S. Treasury Secretary. 

The President’s suspension of the highest tariffs on imports fueled the worst sell-off in stocks since the beginning of the pandemic in 2020. The S&P 500 plummeted slightly into a bear market before regaining some of the loss, and the index is now about 10% off its February all-time high. 

Senior Index Analyst at S&P Dow Jones Indices Howard Silverblatt argued that he had seen few comparable swings in a career spanning more than four decades on Wall Street. He noted that during the April market tensions caused by tariffs, retail investors bet on stocks at low values. Hedge funds and professional traders exited stock positions while piling bearish wagers against the market. Silverblatt believes the institutions were worried that steep tariffs will weigh heavily on consumers and slow down the economy, possibly leading it into a recession.

Data showed that the S&P 500 soared 9.5% on April 11 following U.S. President Donald Trump’s announcement of a pause on some tariffs for 90 days. The tariff pause also came after U.S. Treasuries sold off and showed signs of dislocations as fear rose of a potential recession.

Chief Economist at Apollo, Torsten Slok, believes there will be a summer recession hitting the U.S. as consumers begin to see trade-related shortages in stores coming next month. State Street Global Markets Head of Macro Strategy Michael Metcalfe argued that there was a focus on tariffs news getting worse. He believes there’s also a focus on hard data and whether the market is right to worry about a recession.

Dollar pushes higher on U.S. auto tariff relief

Q: Stocks, bonds, dollar all hit. Should Americans worry about losing investor confidence?

Bessent: Short-term drops are noise. Long-term: US has strong bonds, strong dollar, sound economy. We are building the fundamentals. 10X pic.twitter.com/I5kCMsr8VM

— Tymofiy Mylovanov (@Mylovanov) April 28, 2025

Global stocks and the dollar edged up on April 29 after Trump acknowledged he plans to reduce the impact of auto tariffs, following tariffs that have wreaked havoc on markets in April. The U.S. dollar index shows that the dollar has lost approximately 9% of its value since Trump’s inauguration.

The U.S. dollar inched up against other major currencies, adding almost 0.5% to 142.66 yen. The euro dropped 0.4% to $1.1377, while the sterling slipped 0.4% to $1.3386. Market sentiment was positive after the U.S. revealed it would move to reduce the impact of duties imposed on foreign parts in domestically manufactured cars and keep tariffs on vehicles made abroad from stacking up on other duties.

Data shows that Trump’s levies on trade have not only failed to spark economic growth, but they’re contributing to a sharp contraction in activity. Nancy Vanden Houten, lead U.S. Economist at Oxford Economics, spoke of the impact of Mr. Trump’s first 100 days on the economy and said she “can’t think of a precedent for anything like this.”

Pantheon Macroeconomics’ business survey in April revealed that the U.S. economy is headed for a “sluggish pace of growth.” pointing to what it termed an “existential crisis” for businesses caused by Trump’s tariffs.

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