The stock market continued to fall today. The Dow Jones Industrial Average fell another 478 points, or 1.14%; the S&P 500 fell almost 0.8%; and the Nasdaq Composite fell almost 0.2%. The S&P 500 briefly held its own in trading today, but then Trump announced on his social media platform that he was going to double the tariffs on steel and aluminum from the new 25% rates to a 50% rate on Canada and might increase tariffs to “permanently shut down the automobile manufacturing business in Canada.”
Stocks fell again.
Unable to admit that he might be wrong, President Donald Trump is doubling down on the policies that are crashing the economy. In addition to his tariff threats, he also reiterated that “the only thing that makes sense is for Canada to become our cherished Fifty First State,” an outrageous position that he suddenly began to advance after the 2024 presidential election and which has Canadians so furious they are boycotting U.S. goods and booing the Star-Spangled Banner.
More than 100 top business leaders met with Trump today to urge him to stop destabilizing what had been a booming economy with his on-again-off-again tariffs. Mark Zandi, chief economist of Moody’s Analytics, told Jeff Stein and Isaac Arnsdorf of the Washington Post that in private, “business leaders, CEOs and COOs are nervous, bordering on unnerved, by the policies that are being implemented, how they’re being implemented and what the fallout is. There’s overwhelming uncertainty and increasing discomfort with how policy is being implemented.”
The extreme unpredictability means that no one knows where or how to invest. Market strategist Art Hogan told CNN’s Matt Egan, “This market is just blatantly sick and tired of the back and forth on trade policy.” Yesterday, Delta Air Lines cut its forecasts for its first-quarter revenue and profits by half, a sign of weakening corporate and consumer confidence and concerns about the safety of air travel. Today, Southwest Airlines and United Airlines cut their forecasts, and American Airlines forecast a first-quarter loss.
When he talked to reporters, Trump reasserted that he intends to do what he wants regardless of the business leaders’ input. “Markets are going to go up and they’re going to go down, but you know what, we have to rebuild our country. Long-term what I’m doing is making our country strong again.” White House press secretary Karoline Leavitt advised, “If people are looking for certainty, they should look at the record of this president.”
Not everyone will find that suggestion comforting.
Trump backed off on his threat to raise the tariffs on Canadian steel and aluminum to 50%, but went ahead with his threat to place 25% tariffs on all imported steel and aluminum products. Those tariffs took effect at midnight.
In the face of his own troubles, Trump’s sidekick billionaire Elon Musk is also escalating his destructive behavior. Yesterday Musk’s social media platform X underwent three separate outages that spanned more than six hours. Lily Jamali and Liv McMahon of the BBC reported that Oxford professor Ciaran Martin, former head of the United Kingdom’s National Cyber Security Center, said that the outages appear to have been an attack called a “distributed denial of service,” or DDoS, attack. This is an old technique in which hackers flood a server to prevent authentic users from reaching a website.
"I can't think of a company of the size and standing internationally of X that's fallen over to a DDoS attack for a very long time," Martin said. The outage "doesn't reflect well on their cyber security." Without any evidence, Musk blamed hackers in Ukraine for the outages, an accusation Martin called “pretty much garbage.”
Four days ago, another of Musk’s SpaceX rockets exploded after takeoff, and now SpaceX’s Starlink internet service is facing headwinds. In February, Mexican billionaire Carlos Slim canceled his collaborations with Starlink after growing tensions with Musk culminated with Musk alleging on X that Slim is tied to organized crime. The loss of that deal cost Musk about $7 billion in the short term, but more in the long term as Slim will work with European and Chinese companies in 25 Latin American countries rather than Starlink. Slim has said he would invest $22 billion in those projects over the next three years.
Also in February, after U.S. negotiators threatened to cut Ukraine’s access to the 42,000 Starlink terminals that supply information to the front lines, the European Commission began to look for either government or commercial alternatives. The European Commission is made up of a college of commissioners from each of the 27 European Union countries. It acts as the main executive branch of the European Union.
On Sunday, Musk posted: “[M]y Starlink system is the backbone of the Ukrainian army. Their entire front line would collapse if I turned it off.” Poland pays for about half the Starlink terminals in Ukraine, about $50 million a year. Poland’s minister of foreign affairs, Radosław Sikorski, responded that “if SpaceX proves to be an unreliable provider we will be forced to look for other suppliers.” “Be quiet, small man,” Musk replied. “You pay a tiny fraction of the cost. And there is no substitute for Starlink.”
After all the tariff drama with Canada, last week Ontario also cancelled a deal it had with Starlink.
But perhaps the biggest hit Musk has taken lately is over his Tesla car brand. On February 6, Musk’s younger brother Kimbal, who sits on Tesla’s board, sold more than $27 million worth of shares in the company. Tesla chair Robyn Denholm sold about $43 million worth of Tesla stock in February and recently sold another $33 million. Tesla CFO Vaibhav Taneja has sold $8 million worth over the past 90 days. Yesterday, board member James Murdoch sold just over $13 million worth of stock.
Fred Lambert of Electrek, which follows the news about electric vehicles and Tesla, noted that Tesla stock dropped 15% yesterday, “down more than 50% from its all-time high just a few months ago.” “Tesla insiders are unloading,” he concluded.
Tesla sales are dropping across the globe owing to the unpopularity of Musk’s antics, along with the cuts and data breaches from his “Department of Government Efficiency.” Protesters have been gathering at Tesla dealerships to express their dismay. While the protests have been peaceful, as Chris Isidore of CNN reports, there have also been reports of vandalism. Tesla owners are facing ridicule as protesters take out their anger toward Musk on his customers, and at least one competitor is working to lure consumers away from Musk’s brand by offering a discount to Tesla owners.
Trump has jumped to Musk’s defense, posting just after midnight this morning that “Elon Musk is ‘putting it on the line’ in order to help our Nation, and he is doing a FANTASTIC JOB! But the Radical Left Lunatics, as they often do, are trying to illegally and collusively boycott Tesla, one of the World’s great automakers, and Elon’s ‘baby,’ in order to attack and do harm to Elon, and everything he stands for. They tried to do it to me at the 2024 Presidential Ballot Box, but how did that work out? In any event, I’m going to buy a brand new Tesla tomorrow morning as a show of confidence and support for Elon Musk, a truly great American.”
Indeed, today Trump used the office of the presidency to bolster Musk’s business. Teslas were lined up at the White House, where Trump read from a Tesla sales pitch—photographer Andrew Harnik caught an image of his notes. And then the same man who gave a blanket pardon to those convicted of violent crimes related to the January 6, 2021, attack on the U.S. Capitol called those protesting at Tesla dealerships “domestic terrorists” and promised that the government would make sure they “go through hell.”
Trump and Musk appear to have taken the downturn in their fortunes by becoming more aggressive. Martin Pengelly of The Guardian noted that in the middle of Monday’s stock market plunge, Trump posted or reposted more than 100 messages on his social media channel. All of them showed him in a positive light, including reminders of the 2004 first season of the television show The Apprentice, in which Trump starred: a golden moment in Trump’s past when his ratings were high and the audience seemed to believe he was a brilliant and powerful businessman.
Today, egged on by Musk, Trump pushed again to take over other countries. He told reporters: "When you take away that artificial line that looks like it was done with a ruler…and you look at that beautiful formation of Canada and the United States, there is no place anywhere in the world that looks like that…. And then if you add Greenland…that's pretty good."
The Trump administration also announced today it was cutting about half the employees in the Department of Education. The Senate confirmed Linda McMahon, who has little experience with education, to head the department on March 3 by a party-line vote. Shutting down the department "was the president's mandate—his directive to me," McMahon told Fox News Channel host Laura Ingraham. McMahon assured Ingraham that existing grants and programs would not “fall through the cracks.”
But when Ingraham asked her what IDEA stood for—the Individuals with Disabilities Education Act—she wasn’t sure, although she knew it was “the programs for disabled and needs.” Ingraham knew what the acronym meant but assured McMahon that after 30 years on the job, she still didn’t know all the acronyms. McMahon replied: “This is my fifth day on the job and I’m really trying to learn them very quickly.”
Musk lashed out at Arizona senator Mark Kelly on social media yesterday, after Kelly posted pictures of his recent trip to Ukraine and discussed the history of Russia’s invasion, concluding “it’s important we stand with Ukraine.” Musk responded: “You are a traitor.”
Kelly, who was in the Navy for 25 years and flew 39 combat missions in the Gulf War before becoming an astronaut, responded: “Traitor? Elon, if you don’t understand that defending freedom is a basic tenet of what makes America great and keeps us safe, maybe you should leave it to those of us who do.”
