Wall Street Tycoon Who Supported Trump: “Destroying U.S. Trust… Should Declare a 90-Day Truce”
(Seoul=Yonhap News) Reporter Ko Il-hwan – The U.S. financial market is on edge with fears of a “Black Monday” as it heads into Monday’s opening.
According to the New York Times (NYT) on the 6th (local time), market anxiety has not subsided following President Donald Trump’s announcement of reciprocal tariffs.
With concerns about an economic downturn spreading, $6.6 trillion (approximately 9,690 trillion KRW) in market capitalization was wiped out in the New York stock market over two days since the 3rd, and there are signs that the sell-off will continue.
As of 6 PM on Sunday, Dow Jones 30 industrial average futures dropped over 1,700 points, nearing the drop recorded on the 4th, which was 2,231.07 points (-5.50%).
There are predictions that a “Black Monday” scenario could occur when the New York Stock Exchange opens on Monday.
Jim Cramer, a presenter on CNBC, warned that if President Trump sticks to his tariff policies, a market crash similar to the 22.6% drop in the Dow in 1987 could occur.
Many also note that the current mood in the U.S. financial market resembles the 2008 global financial crisis.
A rapid 10% drop in stocks over two days, as seen last week, is rare except during the collapse of Lehman Brothers in 2008.
Major asset management firms like Apollo and the large private equity firm Kohlberg Kravis Roberts (KKR) saw stock prices fall by over 20% in just two days.
Not only stocks but also oil, copper, gold, and cryptocurrencies are experiencing widespread selling in the U.S. financial market.
In this climate, initial public offerings (IPOs) eagerly anticipated, such as those of StubHub, have been postponed.
Unlike in 2008, there are no market expectations for government intervention.
While the U.S. government prevented a market collapse with astronomical bailout packages in 2008, this year’s turmoil is seen as being caused by the White House.
According to Bank of America (BoA), if countries targeted by President Trump’s tariffs retaliate, the profits of companies included in the Standard & Poor’s (S&P) 500 index could drop by about a third.
Market dissatisfaction with Treasury Secretary Scott Vessent is also growing.
Initially welcomed as a friend in the White House by Wall Street giants when he joined the Trump administration, they have now lowered their expectations following this crisis.
In an interview with NBC, Secretary Vessent defended tariffs, saying they “build a long-term economic foundation for prosperity,” supporting President Trump.
Amid these circumstances, some Wall Street magnates are speaking out proactively.
Billionaire investor Bill Ackman, head of Pershing Square Capital, warned on X (formerly Twitter) that the tariffs could lead to an “economic nuclear war,” with Trump supporters suffering the most.
Ackman criticized the current approach of imposing disproportionate tariffs on both allies and adversaries, arguing that it destroys U.S. trust as a trade partner and capital investment market.
He advised that President Trump should declare a “90-day truce” to rectify unfair trade systems with tariff agreements and encourage new investments during that period.
Ackman, who supported Trump in the last election, stated, “I did not vote for Trump to witness this situation,” and argued that President Trump should immediately declare a 90-day truce on Monday.