New high in US stocks fails to save public opinion: Trump's approval rating drops to a low during his term, Republican base loosening

Although the US stock market continued to hit new highs in Trump’s second term’s first year, this economic prosperity has not translated into political capital. Recent polls show support levels at their lowest, and more concerning is the apparent wavering within the Republican Party, which could have far-reaching impacts on policy stability and market expectations.

Why Economic Prosperity Cannot Save Political Support

Public Opinion Data Hits Bottom

According to the latest reports, a joint poll by The Economist and YouGov shows that Trump’s current approval rating is only 37%, with 57% disapproval, resulting in a net support of -20%, the lowest since his second term began. More notably, the core support within the party has loosened, with Republican support dropping from 88% to 79% in just one week. This 9 percentage point decline indicates that even the core voter base is wavering.

Such disconnection phenomena are not uncommon in political economy, but their scale is remarkable. Usually, positive economic indicators should bolster the ruling party’s polls, but when economic growth benefits are unevenly distributed or policies themselves generate controversy, this translation fails.

Tariff Policies Become Public Opinion Killers

Polls show that 69% of respondents believe tariffs have directly increased their expenses. This is a high level of consensus, indicating that the negative impacts of tariffs have penetrated daily life.

Tariffs drive up inflation and living costs, becoming the primary reason for voter dissatisfaction. There exists a policy paradox: while tariffs are controversial in economic theory, they are perceived very directly and clearly by the public—goods become more expensive. This straightforward negative experience is enough to offset the wealth effects of stock market highs, especially for middle- and low-income groups who do not hold stocks or have low stock exposure.

Trust Crisis in Monetary Policy

Even more interesting is the distribution of public trust in monetary policymakers. 44% of voters trust Federal Reserve Chair Powell to set interest rates, while only 18% trust Trump’s judgment in this area. This reflects widespread doubts about White House interference in monetary policy.

This contrast hints at a political risk: markets and the public are concerned about policy stability and professionalism. An independent Federal Reserve is viewed as more credible, whereas White House intervention is seen as potentially bringing uncertainty.

Geopolitical Pressure Overlay

Beyond economic policies, geopolitics also drags down public opinion. Whether it’s territorial expansion rhetoric like “purchasing or forcibly acquiring Greenland” or considerations of military action against Venezuela, most voters oppose these moves. These uncertain diplomatic signals further heighten market and public anxiety.

Potential Market Impacts

From a cryptocurrency market perspective, the policy uncertainties reflected in this poll could have several effects. First, the loosening of the political core support may lead to shifts in policy directions, including attitudes toward digital asset regulation. Second, differing opinions on monetary and fiscal policies could increase market volatility expectations. Lastly, geopolitical uncertainties typically elevate volatility in risk assets.

Summary

The contrast between new highs in the US stock market and declining public support essentially reflects an uneven distribution of economic growth benefits. The direct negative impacts of tariffs, concerns over monetary policy interventions, and geopolitical uncertainties collectively drag down Trump’s political support rate. More concerning is the decline in support within the Republican Party, indicating that the core base is also loosening. For markets, this means policy stability faces more variables, and risk appetite may be further suppressed.