Commentary: The Trump stock market crash will hurt Main Street more than Wall Street

President Trump and his trade warriors seem to think ordinary Americans and wealthy investors live in parallel universes that never intersect. They talk about Trump tariffs that might dent investment portfolios but will leave workers better off. “Wall Street’s done great,” Treasury Secretary Scott Bessent likes to say . “But this administration is about Main Street.”

Yet it’s ordinary Americans who stand to lose the most from Trump tariffs that are now shredding financial markets and threatening a recession. Since taking office in January, Trump has imposed the most aggressive set of taxes on imports in nearly 100 years, culminating in the huge set of tariffs Trump announced on April 2. Trump dubbed April 2 “Liberation Day” because he thinks tariffs will somehow lead to new levels of prosperity. Investors call it "Obliteration Day" because of the massive losses that promptly followed.

Read more: What Trump's tariffs mean for the economy and your wallet

Since Obliteration Day, the S&P 500 ( ^GSPC ) index has dropped by 10%, one of the fastest short-term declines ever. The S&P is down 17% from its mid-February peak, which is nearly a bear market. The six-week plunge in stocks has destroyed nearly $11 trillion of wealth.

Whose money is that?

There’s a Trumpworld meme suggesting that stock market wipeouts only harm the wealthy. On social media, Trump himself shared a sketchy video claiming that he’s playing a “secret game” in which exorbitant tariffs wreck equity valuations, forcing more investor money into bonds, which lower interest rates, to the benefit of ordinary people who borrow money. “Now remember,” an unseen narrator imparts in the video, “94% of all stocks are owned by only 8% of Americans, so Trump is taking from the rich short term and handing it to the middle class through lower prices."

Commentary: The Trump stock market crash will hurt Main Street more than Wall Street

That’s completely bonkers, as any of the 70 million Americans with a 401(k) retirement plan surely knows after a simple glance at their 2025 losses. In fact, middle- and lower-income Americans will bear the brunt of the Trump stock crash in at least three crucial ways.

The first is directly, through investment losses. It’s true that the majority of stocks are owned by the wealthy. But it’s also true that stocks are a crucial source of wealth for millions of families that are not wealthy. About 62% of Americans have stock market investments, according to Gallup. That’s up about 10 percentage points during the last decade, thanks to simplified investment vehicles like exchange-traded funds and online accessibility, which have democratized stock market investing.

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