Pain of Trump’s policies now spreading from Wall Street to Main Street

(Originally published May 2 in “What in the World“) Trump’s chaotic economy is creating its own kind of trickle-down effect.

First, the stock market’s volatility hurt spending among wealthy consumers, who have more wealth wrapped up in the market. Now, fear of higher prices is hitting middle- and low-income consumers, who are cutting back on everything from cars chocolate to Big Macs and motorcycles. And with shipments from China already dropping, prices are set to rise as the range of products drops.

Consumers aren’t wrong. The Institute for Supply Management said Thursday that its purchasing manager’s index for manufacturers fell 0.3 percentage points in April to 48.7%, the second consecutive month of contraction.

So while consumers cut back on carbs and carbon, investors are cutting back on U.S. stocks and instead buying bonds and foreign stocks.