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Written by David Marshall.
Rising economic uncertainty, fueled by President Donald Trump’s aggressive tariff policies and volatile global events, has driven a surge in Americans’ fears of a stock market crash. According to predictive consumer data firm Resonate, over one in four Americans now dreads a catastrophic collapse on Wall Street, while nearly half express concerns about a broader economic slowdown. These anxieties, compounded by personal financial strain and shifting consumer behaviors, reflect a nation grappling with the unpredictability of a rapidly changing economic landscape. As the U.S. navigates Trump’s second term, the interplay of domestic policy and international tensions demands a closer look at the forces shaping public sentiment and market stability.
Escalating Public Anxiety
Resonate’s recent report reveals a stark increase in economic apprehension across the U.S. population. Approximately 26% of Americans fear a stock market crash, a figure that underscores the pervasive unease gripping investors and households alike. Broader concerns about an economic slowdown have surged by 17.5%, with 46% of respondents now anticipating a downturn. This growing trepidation is particularly acute among those nearing retirement, who vividly recall the 2008-09 financial crisis and its devastating impact on savings and livelihoods.
Personal finances are also under strain, with 24% of Americans reporting they feel “somewhat worse off” financially since March, and overall financial stability sentiment declining by 8.5%. Kevin Thompson, CEO of 9i Capital Group, emphasized the emotional weight of these fears, noting that memories of past market turmoil drive a deep reluctance to endure another crisis. The convergence of these anxieties paints a picture of a populace on edge, wary of both immediate financial pressures and long-term economic prospects.
Trump’s Tariff Policies and Economic Volatility
The Trump administration’s trade policies, particularly its widespread tariffs, have emerged as a central driver of market turbulence. Since taking office for his second term, Trump has championed tariffs as a means to protect American jobs and businesses, arguing that foreign nations have long exploited U.S. markets. In March, he described the economy as undergoing a “period of transition,” rejecting recession fears while acknowledging short-term challenges. However, the implementation of tariffs has sparked volatility, with markets experiencing a 20% drop over six weeks earlier in 2025, according to Drew Powers, founder of Powers Financial Group.
The administration’s Big Beautiful Bill Act, passed by the House, has further fueled concerns by adding $2.4 trillion to the national debt. Economists warn that this fiscal expansion, combined with persistent deficits, could exacerbate economic instability. Public sentiment reflects this unease, with polls highlighting a partisan divide: Republicans largely back Trump’s approach, while broader apprehension persists about the risks of trade disputes and rising prices. Global events, including ongoing conflicts in Ukraine and Israel, amplify this volatility, as markets react swiftly to geopolitical shocks in an interconnected world.
Consumer behavior has shifted in response to these uncertainties. Resonate found that 45% of Americans have postponed travel plans this fall, while 29% have canceled subscriptions. Vehicle and home sales have declined as households prioritize financial caution. Additionally, 48% of shoppers now opt for cheaper brands, a 6% increase, and 36% have cut back on nonessential purchases. These trends signal a broader retreat from discretionary spending, as Americans brace for potential economic hardship.
Expert Perspectives on Market Risks
Financial experts offer varied insights into the likelihood of a stock market crash. Drew Powers attributes recent market dips to tariff announcements and geopolitical unrest, noting that the 24-hour news cycle amplifies public anxiety. Kevin Thompson warns of the dangers posed by ballooning deficits, which he describes as unprecedented in scale. “The market may continue its upward trajectory for now, but the fiscal challenges we face are unlike anything in recent history,” he stated. These concerns are not merely academic; they resonate with investors who have witnessed rapid market declines triggered by policy shifts.
Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, suggests that while fears have eased slightly since the initial tariff-induced market drops, investor caution remains high. “If trade negotiations falter, we could see steep declines return,” Beene cautioned, highlighting the delicate balance between U.S. policy and global trade dynamics. He also pointed to widespread financial exhaustion among Americans, with many feeling “tapped out” after years of economic uncertainty. This sentiment underscores the challenge of restoring confidence in an environment marked by unpredictability.
Historical context provides further perspective. The 2008 financial crisis, triggered by a housing market collapse, wiped out trillions in wealth and left lasting scars on the American psyche. More recent market corrections, such as the 2020 pandemic-induced crash, demonstrated the speed with which global events can destabilize markets. While the U.S. economy has shown resilience—unemployment remains below 4% as of mid-2025, and corporate earnings have largely held steady—the specter of tariffs and debt raises legitimate concerns about sustainability.
Looking Ahead: Uncertainty and Opportunity
The path forward remains unclear, with experts emphasizing that the risk of a stock market crash hinges on multiple variables. International trade negotiations will play a pivotal role, as successful agreements could mitigate the adverse effects of tariffs. Corporate performance, particularly in sectors sensitive to trade policy like manufacturing and technology, will also shape market outcomes. Beene noted that the coming months will clarify whether the economic outlook is as dire as some fear or if brighter prospects lie ahead.
Policymakers face a delicate balancing act. The Trump administration’s insistence on tariffs as a tool for economic nationalism must contend with the reality of global supply chains and retaliatory trade measures. For instance, China’s response to U.S. tariffs has included restrictions on critical exports like rare earth minerals, which could disrupt American industries. Meanwhile, the Federal Reserve’s efforts to manage inflation—currently hovering around 3.5%—add another layer of complexity, as interest rate decisions influence borrowing and investment.
For everyday Americans, the immediate priority is financial resilience. Financial advisors recommend diversifying portfolios, increasing emergency savings, and avoiding panic-driven sell-offs during market dips. The shift toward cheaper brands and reduced spending reflects a pragmatic response to uncertainty, but it also risks dampening economic growth if sustained. As the U.S. navigates this turbulent period, clear communication from leaders about economic strategy could help alleviate public fears, though political polarization complicates this task.
Our Take
The surging fear of a stock market crash reflects a rational response to the uncertainties of 2025, from aggressive tariff policies to mounting national debt and global instability. While the Trump administration’s trade agenda aims to bolster American industry, its short-term costs—market volatility, rising prices, and consumer caution—threaten economic stability. The public’s shift toward frugality and the stark memories of past crises underscore the need for prudent policymaking. A balanced approach, prioritizing trade negotiations and fiscal responsibility, could mitigate risks and restore confidence. However, the administration must act swiftly to address deficits and communicate a coherent economic vision, lest public anxiety translates into a self-fulfilling prophecy of decline. The coming months will test the resilience of both markets and the American spirit.
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