SCOTT DETROW, HOST:
Last night, President Trump gave his first formal address to the nation on the U.S. war with Iran, and he offered an upbeat progress report.
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PRESIDENT DONALD TRUMP: Our enemies are losing in America, as it has been for five years under my presidency - is winning and now winning bigger than ever before.
DETROW: Financial markets were not reassured. Stocks fell today while energy prices continued to climb. The monthlong shooting war has only added to the uncertainty caused by the president's yearlong trade war. We're going to talk about this now with NPR's Maria Aspan and Scott Horsley. Hi to both of you.
SCOTT HORSLEY, BYLINE: Howdy.
MARIA ASPAN, BYLINE: Hey, Scott and Scott.
DETROW: Maria, I'm going to start with you - the non-Scott in the conversation. Stocks rallied earlier this week on hopes of a quick end to the war, but now it looks like investors are not so certain.
ASPAN: No. Today kind of ended up pretty blah. I mean, stocks plunged this morning and then mostly recovered, ending the day flat. But investors were hoping for a lot more than just blah. It was a volatile week, and it's overall been a terrible start to 2026. Stocks overall are still down almost 5% since the war began, and they just ended the worst quarter in nearly four years. Now, we're seeing investors swinging from fear that the war is going to drag on for months or more to hope that President Trump is going to end the war soon and then back again to fear, especially after Trump's speech last night.
This all matters to Wall Street mostly because of oil. The war has already created a global energy crisis, as we know, which means higher gas and diesel prices. And if it continues much longer, everything's going to get more expensive.
DETROW: And we see the price of oil go up and the price of gasoline go up. What do you think that signals about the outlook for the war?
ASPAN: I can't say it signals anything good. I mean, oil is not only important for gas prices, but for the costs of shipping and trucking and pretty much everything we consume. Both global and U.S. oil benchmarks rose to around $110 today. And that's the wrong direction for investors and for all of us.
Also, even if Trump and Iran agreed to end the war tomorrow, some of the damage has already been done. Refineries and other oil facilities in the Middle East have been damaged. All of this is explaining some of the panic we're seeing from investors. I talked about this with Stephanie Link, who's the chief investment strategist for the wealth management firm Hightower. She says that Trump does care about how Wall Street reacts to his policies, which we've seen in the past year, but this war is a little harder to back away from.
STEPHANIE LINK: It's a little more extreme this go-around. You know, tariffs and reversing tariffs is much different than reversing a war.
ASPAN: So it's going to take more than just one speech from President Trump to really reassure Wall Street.
DETROW: And Scott Horsley, I'm going to turn to you now. Even before the president's speech last night, economists were downgrading their forecasts for the coming year. What are they saying?
HORSLEY: They're saying they expect inflation to be higher, economic growth to be slower, and hiring to be weaker all as a result of this war. You know, the National Association for Business Economics had done one of its regular surveys of forecasters in the early days of the conflict. But given the big swings in the energy market since then, organizers decide to go back out and ask another round of questions. And not surprisingly, they found forecasters are considerably gloomier now that the war is entering its second month. More than 3 out of 4 business economists surveyed say they now see downside risk to the economy, and that's largely because of the fallout from the war.
DETROW: So we're talking about the military conflict here, but the U.S. is also in the midst of a trade war that you've been covering every day for more than a year now. And today marks a milestone in that campaign. Where do things stand?
HORSLEY: Yeah. It was exactly a year ago today that President Trump ordered double-digit tariffs on just about everything the U.S. imports. He dubbed it Liberation Day, and he promised those tariffs would usher in a new golden age of stronger factories, lower prices and a smaller trade deficit. Well, a year later, none of that has happened. U.S. factories have lost 89,000 jobs in the last year. Inflation is higher, not lower than it was a year ago, and the trade deficit actually widened in 2025. Erica York, who's with the Tax Foundation, says, Not only does the U.S. now have much higher import taxes than it used to, but we've also seen big swings in those tariff rates over the last 12 months.
ERICA YORK: Which really makes businesses kind of sit on their hands. It's going to weigh on hiring. It's going to change investment plans. So on top of the significant tax increase that the tariffs caused, they also kind of had this added uncertainty tax on top of that.
HORSLEY: Of course, six weeks ago, the Supreme Court struck down about half of Trump's tariffs, saying the president had overstepped his authority. That has not eased the uncertainty, though, because Trump continues to order up new import taxes, including some new ones just this afternoon. Meanwhile, the U.S. businesses that paid the now outlawed Liberation Day tariffs, they're looking for refunds totaling about $166 billion.
DETROW: And Maria, one of the big storylines of all of this was that Trump would routinely back down on some of those biggest tariff threats. Can he backtrack the same way from the war with Iran?
ASPAN: Well, it's not just up to Trump is the problem. Iran also gets a vote, and Iran has retaliated more forcefully than most of our trading partners. Last night, Trump said, we don't need the oil that flows through the Strait of Hormuz. But anyone who's gassed up their car has experienced how much these global disruptions have local impact. So even if the president walks away from that crucial waterway, the rest of the world will still have to pick up the pieces.
HORSLEY: And speaking of picking up pieces, you know, Colin Powell famously warned President Bush before the invasion of Iraq about what came to be known as the Pottery Barn rule, which is you break it, you own it. No one seems to have given President Trump that kind of warning. Or if they did, he's clearly not operating with the same sense of personal responsibility.
ASPAN: There's also - there's more going on in the economy than just the war and tariffs, and we see that in the markets. I mean, oil is the headline right now for obvious reasons. But investors are still worried about what's going to happen with artificial intelligence - how many jobs it may destroy, or if companies are going to reap the benefits of all the money they're spending on it. So there's a lot of anxiety about the economy out there, and the war isn't making any of it any better.
DETROW: That is NPR's Maria Aspan and Scott Horsley. Thanks to you both.
HORSLEY: You're welcome.
ASPAN: Thank you. Transcript provided by NPR, Copyright NPR.
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