The Real Costs of Trade Wars: Disappearing Hopes and Dreams

Nothing triggers financial doomscrolling—obsessively checking headlines and stock prices—faster than chaos and uncertainty, especially when it hits close to home. I wasn't the only one experiencing portfolio panic and that sinking feeling in my stomach after the recent tariffs wiped out $10 trillion of wealth in three days. As a psychologist, I should know that letting my emotions drive my behavior, much less my investment decisions, is a bad idea. But I still got sucked into the financial doomscrolling loop, searching for reassurance that my family's future hadn't just gone up in smoke. I am not alone. CNBC and MarketWatch reported a massive uptick in people logging into investment platforms multiple times per day to check losses or, worse, to make impulsive trades. This pain isn't just on paper. Here's why it hurts and some strategies to help navigate the turmoil.

The Psychological Cost of Market Volatility

The cost of eggs is the least of our worries. The most damaging costs of the tariff wars are psychological. Lost savings mean watching our imagined futures disappear. Saying goodbye to "what would have been" sends a signal to our brain: "Danger, Danger!"

Our brains are wired to pay attention to potential threats so we can take action to survive. Where early humans constantly scanned the horizon looking for danger, we scan the media. Our brains condense all the headlines and social media into a narrative so we can make sense of events and how they affect us.

Our savings are more than dollars. They are symbols of our past efforts, but, more importantly, they are the foundation for our future stories—our vision of what that will be. The anxiety over current losses is amplified by the declining likelihood that our future stories make sense. These stories are part of our identity; they encapsulate our goals and provide our motivation. The losses may only be on paper today, but that doesn't mean we are any less invested in them or that the grief we feel is any less real or painful.

Why We Can't Stop Scrolling

Market volatility breeds uncertainty, something our brains find deeply uncomfortable. Uncertainty undermines our sense of control and predictability—two essential components of psychological safety. In response, we seek more information—news, account balances, forecasts—hoping to feel reassured. But this search often traps us in a doomscrolling spiral instead of calming us.

Fear-driven scrolling increases our sensitivity to emotionally threatening news. Rather than restoring control, this content validates our worst fears, amplifies anxiety, and further fuels the loop. Our anxiety increases with the amount of news we consume during or after a crisis, and this one isn't even over yet. Obsessive portfolio-checking offers a fleeting illusion of control but provides no actionable insight, reinforcing our sense of helplessness. The real compulsion isn't about information—it's about preserving a fragile future story that is at risk of unraveling.

In the past few days, the data revealed something harder to stomach. It's not just fluctuation; it's decline. We're watching our future visions collapse. We face a new reality: No new house, no retirement at 60, no ability to pay the family's medical bills. The numbers represent lost possibilities, turning doomscrolling into mourning surveillance—we're watching the erosion of hope. When the numbers drop, so does our confidence—not just in the market, but in the narrative of our life we thought was unfolding.

Grieving What Could Have Been

The real gut punch? It's not the money; it's the grief that comes from the destruction of our future story. This kind of nontangible loss still causes genuine emotional pain. We are grieving something that hasn't really ended but feels suddenly gone. Because we understand ourselves through the stories we tell, when those narratives fall apart, we experience identity dissonance, undermining our sense of who we are.

Society doesn't acknowledge the need to mourn the loss of expected rewards that result in a delayed retirement, a lost dream home, or not sending the kids to college (Doka, 1989). But these dreams and goals are vital to human motivation, and when the market wipes out years of effort, it takes out the motivational roadmap, too (Snyder, 2002). These aren't small setbacks. These create deep psychological distress and feelings of helplessness.

The Social Impact of Market Chaos

Financial setbacks can extend beyond the wallet, creating a negative bias in how we think and plan and skewing our fundamental beliefs about fairness, predictability, and controllability. Repeated or severe financial losses can undermine motivation. When people feel that their efforts no longer produce positive outcomes, they stop trying. This can reduce financial agency and diminish feelings of efficacy and hope. Thwarted goals for future financial well-being create feelings of helplessness and distress, which, in turn, are related to mental health problems. This is especially true when those goals are integral to our identity—such as our ability to provide for our family or care for our children.

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Letting Go and Letting Go and Letting Go After Loss

The costs of market chaos ripple out across society. People who have experienced significant financial losses are more likely to hold long-lasting mistrust in banks, markets, governments, and even other people. The result is a crowd of angry, disillusioned, increasingly tribal citizens who rely on in-group affiliations, and further partisanship, hate, and violence (Navarro-Carrillo et al., 2018). Social conflict only benefits politicians who usurp power by promising solutions to the chaos and suffering they created.

Rewriting Your Story

Losing money is painful, but losing our faith in the future is devastating. And these emotional shifts often happen silently, buried under shame or self-blame of "If only…" and "I should have…" In the long term, they alter our ability to trust and our motivation to try.

Doomscrolling and portfolio checking may have begun as a quest for information, but they have become a ritual of loss. We started by trying to understand the market and make ourselves feel better, but we ended up watching our future dissolve, one tap at a time. Financial doomscrolling is not a failure of discipline as much as it is a normal response to disrupted identity and hope. Normal or not, breaking the cycle is important if doomscrolling keeps your negative emotions high and undermines your critical thinking and well-being.

Don't let the trade wars and inflation fears turn your future story into Bleak House. The task now is to stay calm and rewrite our stories grounded in resilience and patience rather than fear. We did it before; we can do it again.

4 Constructive Coping Strategies

1. Limit check-ins: Set fixed times to review finances.
2. Reframe the narrative: You are not your account balance.
3. Take small, intentional steps—budgeting, adjusting goals, seeking advice—to restore a sense of control.
4. Don't worry alone. Normalize the conversation around money and mental health.