There seems to be a lot of redditors out there that believe the market should be crashing based on the terrible trade policies put into place. As well as the blatant manipulation from the president.
1. The U.S. market is a ponzi scheme. It's risen consistently for 100 years and 401k automatic contributions of furthers the upward momentum. Nearly 100m people contribute to it biweekly from paychecks.
2. The slower the draw down the better it is for market makers. They get to use retail income flows to sell off their positions. They offset losses by selling high vol options.
3. Tariffs haven't been in place very long. The fiscal reports coming out have been in Q1 where many people were making purchases to avoid tariff increases.
4. Large businesses saw this coming and purchased as much inventory as they could in Q4 2024, Q1 2025. A lot of price adjustments haven't happened yet. It takes time to calculate new cogs.
5. Data confirming negative future growth expectations hasn't come out yet. Canada released their expectations and in the worst case saw a .2% negative GDP. This isn't nearly as bad as expected. The revisions from u.s. banks were still slightly positive GDP.
6. Markets are future looking. Worst case Trump keeps tariffs in play for 4 years. Best case he stops or is checked by congress. They don't want to miss the correction. It seems the expectation right now is these are short lived and will end in 90 days.
7. Huge corporate tax breaks are being pushed by Trump. Obviously the heavier taxation on consumers is bad, but until the consumers stop buying it won't reflect in the market.
8. The administration and news cycles continue to lie and push false narratives. This constant message does influence people to view the actions more positively than it should. Marketing works and it's disgusting.
Tldr: Once layoffs start being announced, we get data confirming demand destruction and inflation. We will drop. That could honestly take until Q3-Q4. It could also come next month if companies report bleak expected future returns.
Until then, the market has done a pretty good job pricing down companies exposed to tarrifs and into "safe" havens of gold/consumer staples/services.