Trump's Tariffs Trigger Wall Street Turmoil; Millennials Embrace Thrift Amid Inflation

Financial markets have sharply declined after former President Donald Trump reintroduced tariffs on April 2, 2025, causing fears of a trade war. The Dow, S&P 500, and NASDAQ saw significant drops. Betting markets show Trump leading Kamala Harris by 3% ahead of the 2024 election. Inflation and tariffs are pushing millennials towards secondhand shopping, with 68% buying used goods in 2024. Retailers are adjusting to increased demand for resale items. A Morning Consult survey indicates growing tariff awareness, with millennials prioritizing affordability and sustainability in response to economic pressures.

Trump’s Tariffs Trigger Market Sell-Off

The announcement of Trump’s “Liberation Day” tariffs on April 2, 2025, sent shockwaves through global financial markets. Within a week, the Dow Jones Industrial Average fell by 11%, the S&P 500 dropped 12%, and the NASDAQ plunged 13%, marking one of the most volatile trading periods in recent history. The sell-off only began to stabilize after Trump announced a 90-day pause on most of the new duties on April 9.

Investors reacted swiftly to the uncertainty surrounding the tariffs, which include a baseline 10% levy on a wide range of imports and proposed increases on goods such as automobiles, pharmaceuticals, and consumer electronics. Federal Reserve Chair Jerome Powell acknowledged the “challenging scenario” posed by the tariffs, warning that they could lead to higher inflation and slower economic growth.

JPMorgan raised its recession probability to 60%, citing the potential for disrupted supply chains and increased production costs. The International Monetary Fund echoed these concerns, stating that while a global recession is unlikely, the tariffs will “stoke inflation and slow growth.”

Betting Markets Favor Trump Ahead of Election

Despite the economic turbulence, betting markets have shifted in favor of Donald Trump as the 2024 election approaches. According to aggregated data from BetMGM and RealClearPolitics, Trump currently leads Kamala Harris by approximately 3% in betting odds, marking the first time he has overtaken her since their September debate.

The shift in odds follows a series of high-profile campaign events and debates, including a performance by Trump that bookmakers say swayed public sentiment. While national polls remain tight—some even showing Harris with a slight lead—the betting markets, where real money is at stake, suggest a growing confidence in Trump’s electoral prospects.

Notably, a mystery trader known as “Fredi9999” has placed millions of dollars on a Trump victory, further influencing the prediction markets. Elon Musk also weighed in, tweeting that betting markets are “more accurate than polls” because they reflect informed financial risk-taking.

Inflation and Tariffs Fuel Millennial Frugality

As tariffs raise the cost of imported goods, millennials are increasingly turning to secondhand markets to stretch their budgets. According to a recent report by ThredUp, 68% of millennials and Gen Z consumers shopped secondhand in 2024, with nearly half saying they now look to thrift stores first when shopping for clothes.

The trend is not limited to apparel. Baby gear, household items, and even sports equipment are being purchased secondhand at record levels. Kristin Langenfeld, CEO of GoodBuy Gear, noted that nearly one-third of baby gear is now bought used. A Babylist survey found that 67% of expecting parents consider secondhand shopping their primary money-saving strategy.

Kelsey Meyers, a 38-year-old mother of four from Minnesota, told USA Today that she has seen a dramatic increase in younger shoppers at thrift stores since the pandemic. “Sometimes I can’t even find a parking spot,” she said, noting that inflation and tariff-related price hikes have made secondhand shopping not just trendy, but necessary.

Retail executives are also preparing for the impact. Sheng Lu, a professor at the University of Delaware, warned that secondhand stores are “not totally immune to the tariff impact,” predicting that increased demand could lead to higher prices even in the resale market.

Generational Awareness and Economic Behavior

A Morning Consult survey found that awareness of tariffs has grown across all age groups, though older generations are more likely to follow the issue closely. Still, a significant portion of Gen Z and millennials are adjusting their spending habits in anticipation of higher prices.

More than half of U.S. adults now expect tariff-related price increases on essentials like groceries, gasoline, and electronics. Among millennials, this has translated into a shift toward value-driven consumption, with sustainability and affordability becoming key priorities.

The economic pressures are compounded by broader financial challenges. Gen Z and millennials face higher debt-to-income ratios than previous generations, with the New York Fed reporting that Gen Z has the highest percentage of credit card debt. Food prices have risen over 20% since 2019, and housing remains out of reach for many young adults.

Retailers Brace for Long-Term Shifts

Retailers are responding to these shifts by expanding their resale offerings and adjusting pricing strategies. ThredUp’s Chief Strategy Officer, Alon Rotem, said that while tariffs won’t directly impact their business model—since all inventory comes from American closets—the company is preparing for a surge in demand.

“Secondhand prices are going to be much more compelling in relative terms,” Rotem said, especially as tariffs on Chinese goods could more than double the price of some new items. He added that younger consumers are increasingly motivated by both cost and environmental concerns.

Retailers like GoodBuy Gear are also using algorithms to adjust prices based on demand and manufacturer pricing, meaning that even secondhand goods could see price hikes if tariffs persist.

Trump's Tariffs Trigger Wall Street Turmoil; Millennials Embrace Thrift Amid Inflation

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