Tariff Fears Are Rattling the Market. Here's What 100 Years of Data Says About What Happens Next.

Tariffs have been a hot-button topic for both businesses and consumers over the last year. Now that tariff refunds are starting to roll out for importers, some investors are concerned that the U.S. could end up paying more for the refunds than it collects in tariff revenue -- potentially complicating economic growth.

Regardless of how the tariff situation unfolds, confusion and uncertainty aren't generally great for investor optimism. Here's what history says about what might be coming next.

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Is a recession coming in 2026?

Nobody can say exactly what the market or economy will do in the coming months, especially when new government policies could change that trajectory on a dime. That said, even if the U.S. does enter a recession in the coming year or so, history has promising news for investors.

Over the past century, the stock market has faced severe recessions, bear markets, crashes, and corrections, yet it's thrived despite them all.

The past two decades have been particularly volatile for the market, with major indexes experiencing multiple record-breaking downturns. Despite all the turbulence, the S&P 500 (^GSPC +0.02%) has delivered total returns of more than 760% over the past 20 years.

^SPX data by YCharts

Historically, most downturns have also been shorter than many investors expect. In fact, the average S&P 500 bear market since 1929 has lasted only around nine months, research from Bespoke Investment Group found. While there will always be outliers, generally speaking, bull markets have historically lasted far longer than bear markets.

What investors can do right now

If history shows us anything, it's that staying invested through all the market's rough patches is key. The market can be incredibly unpredictable, and trying to time your sell-off perfectly can be risky -- especially with factors like tariffs, inflation, and wars complicating the market's future.

No matter what's on the horizon, investing in strong stocks and holding them for at least a few years is one of the best ways to protect your portfolio against volatility.