Tue May 06 12:40:00 UTC 2025: ## Billionaire Warns of Further Stock Market Plunge Despite Tariff Backtrack

**New York, May 6, 2025** – Billionaire hedge fund manager Paul Tudor Jones has issued a stark warning that US stocks could fall to new lows, even if President Trump significantly reduces his tariffs on Chinese goods. Jones, founder of Tudor Investment Corporation and famed for predicting the 1987 Black Monday crash, expressed his concerns on CNBC’s Squawk Box.

Jones argues that the combination of President Trump’s tariffs and the Federal Reserve’s reluctance to cut interest rates creates a toxic mix for the stock market. While the S&P 500 has seen a slight rebound after last month’s record tariff increases, Jones believes the market hasn’t reached its bottom.

He predicts that even a substantial reduction in tariffs – perhaps to 40% or 50% – would still represent a massive tax hike, potentially slowing economic growth by 2-3 percent. The initial tariffs, reaching as high as 145% on Chinese goods, triggered retaliatory tariffs from China up to 125%, sending global markets into turmoil.

Jones acknowledges the apparent strength of the current economy but describes it as being artificially inflated, “on steroids.” He emphasizes that the Federal Reserve needs to adopt a significantly more dovish approach and cut interest rates substantially to prevent further market decline. He forecasts that only a combination of significant Federal Reserve action and a major shift in administration policy will prevent a continued downward spiral. This, he says, will likely only occur *after* the market hits new lows.

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