The Biggest Development in Trump’s First 100 Days
Author: Greg Valliere
April 29, 2025
IT’S BEEN A ROCKY RIDE, but there are several reasons to believe that Donald Trump’s first 100 days of his second term may be followed by some positives for the markets in the second 100 days.
THE BIGGEST THEME, IN OUR OPINION, is that Trump can be curbed by the markets themselves. After several days of 1,000 point losses, Trump got the message — he toned down his criticism of Fed Chairman Jerome Powell, and he softened his stance on tariffs. The markets won.
THE PIVOTAL DAY came last Monday, when business leaders, Wall Street executives and Republican lawmakers besieged Trump to dial it back. He did — and a precedent was set.
THIS DOESN’T MEAN TRUMP IS GOING SOFT, it’s simply a sign that he respects the markets and will listen to leaders in his own party. A moderate tone, urged by the Wall Street Journal editorial page, may be emerging.
THERE WERE SEVERAL OTHER THEMES in Trump’s first 100 days that will be intriguing —
TAX CUTS WILL BE THE MAJOR DOMESTIC ISSUE heading into the summer. Trump wants a tax bill finished by the July 4 break, a heavy lift, but we think he will have just enough votes in the House to get a bill passed as the August break begins.
THIS WILL BE A FIERCE BATTLE, AS Congress debates how to pay for the measure, and what cuts — especially to Medicaid — will be required. But a huge tax bill will be the big summer theme, a likely plus for Trump.
ANOTHER MAJOR THEME WILL BE REGULATORY REFORM, as Trump turns to executive orders, The regulatory climate will be laissez faire and pro-business.
JUST AS THE FIRST 100 DAYS HIGHLIGHTED FRICTION over the Fed’s monetary policy, this will continue through the summer as the central bankers go slow on rate cuts. But Trump’s economic advisers have convinced him to stop the personal attacks on Powell, a major plus for the markets.
THE BIGGEST POLITICAL THEME IS CLEAR — Democrats still have no leader and no theme. The party’s polls are the worst ever, even worse than Trump’s. Clearly, from Canada to California, it’s the economy stupid, as James Carville famously declared.
PERHAPS THE BIGGEST SURPRISE in the first 100 days was the inordinate amount of time Trump has spent on geopolitics. The war in Ukraine may be winding down, but a major escalation in the U.S. war with the Houthis seems imminent.
BOTTOM LINE: The second half is shaping up as more positive than the first half — the economy is still growing, inflationary pressures have eased a bit, and a pro-growth tax bill is just what the doctor ordered. And it may be accompanied by a rate cut or two as the Fed finally gives Trump what he needs to keep the economy from slipping into inflation.
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MARK CARNEY DIDN’T DO QUITE AS WELL as we expected last night, but he won and didn’t pull his punches, so we’ll give him the final word this morning:
“AS I’VE BEEN WARNING FOR MONTHS,” Carney said last night, “America wants our land, our resources, our water, our country. These are not idle threats. President Trump is trying to break us so America can own us.”
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