Paul Tudor Jones sees more trouble ahead for the stock market, blaming a dangerous policy mix of aggressive tariffs and a reluctant Federal Reserve. In a recent interview, the legendary investor said the market is likely to fall to new lows unless there's a dramatic shift in direction. According to Jones, President Trump is unlikely to back off tariffs significantly, even though he may eventually scale them down by 50%. But that still leaves a damaging economic burden — what Jones describes as the biggest tax hike since the 1960s. He estimates these trade measures could shave 2–3% off U.S. economic growth. Meanwhile, the Federal Reserve isn’t stepping in to help. Without bold rate cuts from the Fed, Jones believes markets will continue to slide. Only when the economic slowdown becomes visible in hard data will both Trump and the Fed be forced to act, potentially triggering a rebound. Despite his criticism, Jones said the original idea of correcting trade imbalances with China made sense. The problem, he noted, started decades ago when China joined the WTO without fully opening its currency market. Tariffs could have worked, he argues, if used precisely — not as blunt instruments. According to Jones, President Trump is unlikely to back off tariffs significantly, even though he may eventually scale them down by 50%. But that still leaves a damaging economic burden — what Jones describes as the biggest tax hike since the 1960s. He estimates these trade measures could shave 2–3% off U.S. economic growth. Meanwhile, the Federal Reserve isn’t stepping in to help. Without bold rate cuts from the Fed, Jones believes markets will continue to slide. Only when the economic slowdown becomes visible in hard data will both Trump and the Fed be forced to act, potentially triggering a rebound. Despite his criticism, Jones said the original idea of correcting trade imbalances with China made sense. The problem, he noted, started decades ago when China joined the WTO without fully opening its currency market. Tariffs could have worked, he argues, if used precisely — not as blunt instruments. Meanwhile, the Federal Reserve isn’t stepping in to help. Without bold rate cuts from the Fed, Jones believes markets will continue to slide. Only when the economic slowdown becomes visible in hard data will both Trump and the Fed be forced to act, potentially triggering a rebound. Despite his criticism, Jones said the original idea of correcting trade imbalances with China made sense. The problem, he noted, started decades ago when China joined the WTO without fully opening its currency market. Tariffs could have worked, he argues, if used precisely — not as blunt instruments. Despite his criticism, Jones said the original idea of correcting trade imbalances with China made sense. The problem, he noted, started decades ago when China joined the WTO without fully opening its currency market. Tariffs could have worked, he argues, if used precisely — not as blunt instruments.