The stock markets slumps
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This is happening all over the world. Perhaps surprisingly some pro-capitalist commentators are understanding what it means. This, for instance, from a Q&A in today’s Times of London:
“Why are global stock markets in a tailspin?
The short answer is President Trump’s tariffs. The longer answer is that global investors are betting that the president’s tariffs will result in a fall in corporate profits as companies face higher costs and lower demand for their goods. The prospects of falling profits encourages investors to sell their shares because it means companies will not be able pay as much out in dividends and will be worth less in future.”Shares are a form of “fictitious capital” in the sense that they don’t represent real capital that can be invested but a capital sum created by capitalising a future income stream, in their case expected future profits.
If this income stream dries up or is expected to dry up, then so does the size of the notional capital sum. A part of the fictitious capital is exposed as such and disappears.
If there is going to be a slump in the investment of real capital and so of production it won’t have been caused by the stock markets’ collapse but only anticipated by it. The real cause will be what caused the markets to collapse. Normally it is overproduction. In this case it is the tariff policy of the American government.
As Marx pointed out with regard to banking laws, mistaken government action can precipitate a financial and economic crisis but no government action can stop one occurring spontaneously from time to time.
It remains to be seen whether Trump’s tariff policy will be such a case.
The economic crisis existed before the Tariff. The real crisis is over production. When the shit hits the fan it will spread all over
Now the market for US government bonds is being affected. Selling bonds is the way governments mainly borrow money. The “yield” is the rate of interest on their nominal value. If it goes up it means that a government has to pay more for renewed and new loans
Of course the US government will never go bankrupt as its “collateral” is its power to raise money through taxation to repay its debts. But if yields keep going up it will have to use more in of its tax income to service its future debts.
One of its main creditors is China — yes, China lends money to American — and there is speculation that, as part of the economic war going on between to the two, China is selling some of its US bonds precisely to lower their price and so increase the yield on new loans (even this would harm China by reducing the value of the bonds it keeps).
https://www.cnn.com/2025/04/09/investing/global-stock-market-reciprocal-tariffs-hnk-intl/index.html
The bonds yields forced them to pause the tariffs.
https://www.wsws.org/en/articles/2025/04/10/alfb-a10.html
The announcement yesterday by US President Trump of a 90-day pause in the implementation of his so-called “reciprocal tariffs,” ostensibly to allow negotiations to take place, is another expression of the deepening economic and financial crisis of American imperialism and its state.
The move came amid growing signs that the entire financial system—in particular the US Treasury market—was just days or even hours away from a meltdown on the scale of the crises of September 2008 and March 2020, or potentially even greater.
Man regulates and the market dispose.
https://www.npr.org/2025/04/10/g-s1-59342/global-markets-react-trump-tariffs-pause
Global market react to Trump tariff pause.
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U.S. stocks slumped on Thursday, giving up a chunk of the spectacular gains seen in the previous session, as some of the relief after President Trump paused many of his tariffs started to dissipate.In this photo, President Trump stands outside the White House with a yellow race car and several race car drivers and team owners.
POLITICS
Trump says he will pause tariff hikes for 90 days, but not for China
The Dow Jones Industrial Average ended down 2.5% after surging close to 8% on Wednesday. The S&P 500 fell more than 3%, while the Nasdaq lost just over 4% after each index had also soared a day earlier.The declines on Thursday underlie how much uncertainty still remains about what Trump will do about tariffs given that he left others in place, including a 10% tariff on most countries. He also ratcheted up his tariffs on China to 145% so far in this term when including all that he has already imposed.
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The president of the USA might be the most powerful man over the earth, but he can not control the market system, it is the opposite way, the market system control and regulate all leaders
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