Ryan Monarch, assistant professor of economics, tells Newsweek tariffs are the key policy contributing to the market selloff, describing them as a “self-inflicted wound.”

Typically, a Republican presidency would be defined by a pro-business outlook that includes lower taxes and deregulation, which tend to boost investment in equities. Trump's tariffs, however, are a driving force in the other direction this time, Monarch says.

“In the first Trump administration, there was this widespread belief that downturns in the stock market that came from federal policies would encourage President Trump to reconsider those policies,” Monarch says. “That's a change we're seeing because even with the recent downturn in markets, President Trump has continued on his pace of adding new tariffs, defending the tariffs, layering them one on top of each other.”

In the Nexstar article, “President Trump threatens tariffs on Canadian dairy and lumber,” Monarch says, “It’s hard to imagine a more haphazard and random rollout of these policies. The scale of the change we’re seeing now is just unprecedented in any of our lifetimes.

“We could see both higher prices and effects on the labor market, effects on growth,” Monarch says.