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Individual Investors Show Confidence Amid Market Turmoil
Treasury Secretary Scott Bessent emphasized on Tuesday that individual investors are maintaining their positions during recent market fluctuations, expressing confidence in President Donald Trump’s tariff strategy.
“While institutional investors have shown signs of anxiety, individual investors seem committed. They place their trust in President Trump,” Bessent stated during a press conference, alongside White House press secretary Karoline Leavitt.
He referenced data from a Washington Post article, highlighting that “over the past 100 days, 97% of Americans did not engage in trading,” a significant indicator of retail investor confidence. Bessent, who previously led a hedge fund, pointed out Vanguard’s findings, one of America’s largest investment firms.
Trump’s implementation and later suspension of new tariffs—the most substantial in many years—contributed to a dramatic stock market decline, marking the steepest sell-off since the early days of the COVID-19 pandemic in 2020. The S&P 500 index briefly descended into bear market territory before recovering some losses, currently standing about 10% below its peak in February.
In the midst of this April downturn, retail investors capitalized on lower stock prices, purchasing significant shares. Conversely, hedge funds and professional traders exited the market en masse, increasing their bearish positions.
Concerns among institutional investors have heightened, with many fearing that the aggressive tariffs may adversely impact consumers and potentially steer the economy into a recession.
Torsten Slok, chief economist at Apollo Global Management, predicts a possible recession this summer as consumers might begin experiencing trade-related shortages in retail outlets next month. Additionally, Ken Griffin, founder and CEO of Citadel, warned that Trump’s trade disputes could damage the United States’ international reputation and undermine the attractiveness of U.S. Treasury securities.
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