After February’s first tariffs, I thought maybe the market had already adjusted. But on April 2, 2025, President Trump called it “Liberation Day.”
After February’s first tariffs, I thought maybe the market had already adjusted. But on April 2, 2025, something much bigger hit – President Trump called it “Liberation Day.”
On that day, he announced a 10% tariff on nearly all imports into the U.S. That’s not just steel or cars – basically everything. And on top of that, countries with big trade deficits (like China) got slammed with even higher tariffs, up to 54%.
The reaction was instant. The S&P 500 dropped almost 10% in just two days, and the Dow Jones fell more than 2,000 points. Headlines called it one of the biggest market drops in history. For the first time, I saw how quickly fear can spread. Companies that depend on global supply chains tech, retail, even food suddenly looked riskier.
But what I found most interesting was what happened next. Just a week later, when the White House started talking about possible exemptions and pauses, the market bounced back.
It reminded me that stocks don’t just react to facts they react to expectations, rumors, and emotions.
I believed in compounding and was excited to start investing. My mom opened my custodial account at Schwab on my 15th birthday with $1,000, and I added more later. Altogether, I had around $1,700 invested. My very first trade was 3 shares of TSM at $200 each, which I wrote about before in my “How Can a Student Open a Brokerage Account?” post.
At first, it felt amazing to finally own real shares. But then Trump’s tariff policies came out, and the market started dropping. Suddenly my portfolio was full of red numbers. I took a screenshot of my account to remember how it looked. Seeing the value go down so fast made me feel like I had the worst timing ever.
I kept refreshing the app, hoping it would bounce back, but it didn’t right away. I felt like compounding was just a lie, because my account was shrinking instead of growing.
Now, after reading and thinking more, I realize this is normal. Tariffs and politics can hurt the stock market in the short term. Even small student accounts like mine get hit. But compounding works over years, not weeks. One bad start doesn’t mean the end of the story.
What I Learned
- Trump’s tariff policies caused my first real losses.
- My portfolio screenshot showed mostly red numbers, and it felt discouraging.
- Compounding is still real, but it takes patience and time.
- Markets can flip quickly from fear to relief based on expectations, not just reality.
- The stock market panicked, with one of the fastest drops in years.
Next time: After seeing how fast markets can swing, I want to explore how long term investors deal with short term chaos.
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