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When President Donald Trump announced reciprocal tariffs, Wall Street panicked and markets plunged. Now, with the Dow surging past 50,000, Trump trade advisor Peter Navarro says the rebound is proof the tariffs defied Wall Street fears and helped drive investment, productivity and economic growth critics never saw coming.
White House Counselor for Trade and Manufacturing Peter Navarro joined FOX Business’ Maria Bartiromo on ‘Mornings with Maria’ as markets pushed to new highs, reflecting on the sharp reversal that followed April’s tariff-driven sell-off.
The rally marks a dramatic reversal from early April, when stocks sold off sharply after the tariff announcement and the Dow slid toward 38,000 points. Navarro said that moment exposed a fundamental disconnect between Wall Street’s inflation fears and how President Donald Trump’s economic strategy actually works.
“It’s nice to be right,” Navarro said, pointing back to his prediction in April. “We were talking on April 7th, thereabouts… The Dow had fallen to 38,000… What I said to you… It’s going to 50,000.”
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Navarro argues tariffs are widely misunderstood because they are viewed in isolation rather than as part of a broader supply-side framework. That approach combines tax cuts, deregulation, energy policy and trade enforcement. Navarro calls this the administration’s “four engines of growth.”
“What you get with tariffs is you get a massive wave of investment… That increases productivity… Productivity is the key to rising real wages,” Navarro said.
Navarro argued the investment surge strengthens productivity, supporting wage growth without driving inflation. He said the same dynamic played out after the 2016 election, when futures markets plunged only to be followed by a powerful rally.
Recent economic data, Navarro said, is beginning to reflect that sequencing. He pointed to the ISM manufacturing index jumping above 50, signaling expansion for the first time since 2022, after months of construction and capital investment.
“You got to have the construction jobs first, then you get the manufacturing,” Navarro said, adding that durable goods orders and GDP growth are now moving in the same direction.
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Navarro also urged investors to recalibrate expectations around job data as immigration enforcement reshapes the labor market.
“50,000 a month is going to be more like what we need,” Navarro said, arguing headline numbers must be viewed in context.
With the Dow clearing 50,000 far faster than skeptics expected, Navarro says markets are once again signaling confidence that President Donald Trump’s trade policies are driving growth — not inflation.
