If this were to last months (talking about the uncertainty surrounding these tariffs), Trump will be in a heap of trouble. My thought is he'd better start negotiating, the sooner the better.
Why would he be in a heap of trouble? With who?
Yall realize his base is NOT people who are invested in the markets, right?
And you know the people at the top of his admin have been banging the drum that they are serious about tariffs AND that they do not view the stock market as actually reflective of the economy. They have repeatedly been saying Main Street is their indicator. And Bessent has been saying they NEED the 10y demand to go up for our $7T refinancing
The actual number on the tariffs is fully open for negotiation. The fact that there are going to be tariffs seems foolish to believe is just a negotiation tactic. The truly interesting thing will be how they go about income tax cuts, and if they actually do what they promised and make it a cut for the "poor" and not the rich.
Imo the hope is definitely:
- Impose tariffs and have the ERS. Incentivizes Domestic Manufacturing
- Reduce Income tax. Incentivizes More people to enter the workforce and to work more.
- DOGE cuts $1T+. And we need them to massively overhaul the DoD, and stop treating them with kid gloves. DOGE is also tasked with bringing all Government Tech and accounting into the 21st century, which I believe will have a large impact on efficiency.
- They significantly cut on some dumb regulations to be very pro business, manufacturing, and energy generation
- Make Energy production (Nuclear, Solar, LNG, etc), Battery Cell and Mineral Production, and Chip manufacturing
Even if it all goes according to plan, I think the Stock market could be down for months for sure. Long-term I can see this being incredibly good for everyone though. Judging the success of this massive change based on the stock market reaction within a quarter is ******* dumb imo. The decisions shouldn't be made by short term thinking....