"Black Monday": US Expert's Stark Warning As Trump Tariffs Rattle Markets

Sounding alarm bells after US President Donald Trump's Liberation Day global tariff plans crushed global stocks for two consecutive days, CNBC host Jim Cramer predicted global markets could  witness a blood bath that could expand into a crash similar to 1987's "Black Monday." The American market commentator's warnings followed a brutal two-day sell-off on April 3-4, 2025, when the Dow Jones Industrial Average (DJIA) plummeted 2,231 points amid fears that US import tariffs could exacerbate inflation and stall economic growth.

Cramer said no matter what the numbers reveal, the direction of the market will depend on President Trump's next move. 

"If President Trump stays intransigent and does nothing to ameliorate the damage that I saw these last few days, I'm not going to be constructive here," The TV personality said. 

"If the president doesn't try to reach out and reward these countries and companies that play by the rules, then the 1987 scenario... the one where we went down three days and then down 22 per cent on Monday, has the most cogency," he added. 

Cramer predicted that the outcome won't take long to be seen. "We will know it by Monday."

"Our only real hope is that the president comes up with something that can turn this bear into a bull," he noted.

Effect Of Trump Tariffs On Markets

Global stock markets extended their recent rout on Friday, with S&P 500 companies wiping out $5 trillion in stock market value since the American President unveiled sweeping tariffs on Wednesday, while investors fled to the safety of government bonds.

The Nasdaq confirmed it was in a bear market, ending more than 22.7 per cent below its record high close on December 16, while oil prices and other commodities plunged. Meanwhile, the Dow Jones Industrial Average and pan-European STOXX 600 index each confirmed they were in a correction.

All three of the major US stock indexes suffered their biggest weekly percentage losses since March 2020  when the pandemic ripped across global markets, and the Cboe Volatility Index jumped to 45.31, its highest closing level since April 2020.

Trump Tariffs 

Countries around the world threatened to wage a trade war with the United States as Trump's sweeping tariffs fed expectations for a global downturn and sharp price hikes for swathes of goods in the world's biggest consumer market. The penalties announced by Trump on Wednesday drew condemnation from other leaders reckoning with the end of a decades-long era of trade liberalization. 

Responding to Trump's tariffs, China on Friday said it would impose additional levies of 34 per cent on American goods, confirming investor fears that a full-blown global trade war is underway and that the global economy may be at risk of a recession.

In Japan, one of the United States' top trading partners, Prime Minister Shigeru Ishiba said that the tariffs had created a "national crisis" as a plunge in banking shares on Friday set Tokyo's stock market on course for its worst week in years.

Investment bank JP Morgan said it now sees a 60 per cent chance of the global economy entering recession by year-end, up from 40 per cent previously.

But there were conflicting messages from the White House about whether the tariffs were meant to be permanent or were a tactic to win concessions, with Trump saying they "give us great power to negotiate."

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