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From my online broker's newsletter.


DJ Tariffs Catch Traders Off Guard. Why Stock Markets Are Still Misjudging Trump and 5 Other Things to Know Today. -- Barrons.com



So President Donald Trump meant what he said all along and tariffs weren't an empty threat.

The realization finally hit investors Monday and the fallout was brutal. The S&P 500 had its worst day of the year Monday and has now fallen 2.5% since Trump returned to the White House in January.

The index's gains since the election in November are just about intact but it's hard to see them lasting much longer if the levies keep coming. Berkshire Hathaway CEO Warren Buffett is concerned, too -- he said Sunday that tariffs are an act of war and could cause inflation.

The market's conviction that Trump's trade strategy was just one big -- but ultimately harmless -- game of chicken has suddenly evaporated. The 25% tariffs on Canada and Mexico, and a further 10% on China spooked investors but the ramifications don't end there.

All the president's other threats must now be seen in a new, more serious, light -- including his promise to target the European Union next. Stocks across the Atlantic have marched to record highs but were selling off Tuesday. Trump's decision to pause all military aid to Ukraine made sentiment even worse -- another seismic global development for those bothering to keep count at this point.

Yet, after underplaying the risk for so long, there are signs traders still don't fully believe what's in front of them. The Canadian dollar and Mexican peso fell Monday but are still trading significantly higher than the lows they reached early last month, which suggests at least some optimism.

Maybe the market thinks the 25% levies will be short-lived or it's just peak stubbornness at this point and a refusal to accept Wall Street might have been wrong.

Regardless, it leaves stocks exposed to further shocks. The world is changing rapidly and the market is playing catch up.

-- Callum Keown

There was a hypothesis that President Trump judged his economic success by the stock market level: he would do nothing to cause the market to drop or would quickly back off from any policy that was causing a drop. I believe that hypothesis was wrong. The game has changed.

I’m wondering when/if all the CEOs who supported him will finally call him out for his craziness. Will they really allow the entire system to be destroyed?

I’m wondering when/if all the CEOs who supported him will finally call him out for his craziness. Will they really allow the entire system to be destroyed?

I don't think it's destruction as such. Sure, many government institutions will be destroyed (RAGE: Retire All Government Employees). For the business world it's more of a reset. There'll be winners and losers, but the winners are already winners.

Yeah, I read about Curtis Yarvin last night. Didn't sleep well after that.

https://www.nytimes.com/2025/01/18/magazine/curtis...

The destruction of long standing alliances around the world sounds like more than a reset.

Entering into an authoritarian regime where businesses have to curry favor with the dear leader or risk ruin doesn’t sound like a reset.

The administration ignoring court rulings and bypassing Congress doesn’t sound alike a reset.

I could go on and on. This is game changing stuff we are watching, and it doesn’t seem like enough people, powerful people (not peons like me), are really DOING anything to stop it.

This is game changing stuff we are watching

It is, that's my point. The game has changed.
We should probably take this to the US Policy board.
Though it will affect Berkshire, which is 50% of my families' net worth.

The destruction of long standing alliances around the world sounds like more than a reset.

This post only shows where you get your “propaganda/news”.

The destruction of long standing alliances around the world sounds like more than a reset.
{... more political ranting ...}

How about honoring Manlobbi's request to stop posting political rants on investing boards and take it to the "Political Asylum" board that he created for that specific purpose.

The destruction of long standing alliances around the world sounds like more than a reset.
...
This post only shows where you get your “propaganda/news”.

I think pretty much all Republicans would agree with the statement, no? Or even the white house. It doesn't seem controversial at all.

For example, voting at the UN against the resolution by UK and France condemning Russia's invasion, then voting with Russia and North Korea on the version that matches the Kremlin's blameless view. Or stating a firm intent to take territory from allies such as Denmark and Canada without their agreement. Quite aside from whether these are good things or bad things do to, about which reasonable people might disagree, objectively speaking they certainly count as destruction of long standing alliances. Pretty effective, too.

Jim

How about honoring Manlobbi's request to stop posting political rants on investing boards and take it to the "Political Asylum" board that he created for that specific purpose.

I agree, I come here to read about business and Berkshire. I can’t help responding when I read such a silly and misinformed post! I would never start one, but can’t help getting worked up and responding to uninformed fake news watchers.

The tariffs deserve discussion. Politics are hard to dance around when they are at the root of the issue, but the tariffs are a big deal. So is the ending of the US military assistance to Ukraine, the vast majority of which was spent on US defense contractors, giving the economy a mini war-time boost.

Post Covid, economists were putting the odds of a recession at around 75%. I'd say roughly the same percent of the posts on this board were in agreement (they were well thought out posts too, hard to fault them). The recession never came, but I find it easy to imagine that the wheels have been put in motion to finally bring one on.

In all our machinations on BRK price and value, it is an inescapable fact that it will go up and down with major market moves. The treasury secretary opined that the market response would just be a temporary adjustment, and that over all the economy and stock market are going to do well. I have my doubts, and certainly value what everyone else here thinks.

As it applies to BRK, I had a sell order in at $518 yesterday morning. The markets open before the sun comes up west coast time, and seeing an opening at $517, and concerned about the tariffs, I tripled the size of the order. I avoid snap judgements, selling over the phone laying in bed, but it may well turn out to be one of my luckier trades.

My only regret in starting this thread is I have to look at my failed attempt to spell Tariffs each time someone responds.

You can be certain that the success the current administration is having running over and around traditional processes is being watched and appreciated by younger men who will one day have the opportunity to have tremendous power. Rather than being a very old man with limited intelligence there's a Steven Miller type somewhere out there with a cult absorbing personality that will gain all the quockerwodger's in the US for votes and power.

My guess it is going populist far more than capitalist. All us US'ers who voted to make sure the libs didn't get the power (with good reason) elected something I think we are going to regret. With 30% approval he'll be just as powerful as he is today. Remember that when thing begin to go a way that's not good for passive shareholders of US corporations.

My guess it is going populist far more than capitalist. All us US'ers who voted to make sure the libs didn't get the power (with good reason) elected something I think we are going to regret. With 30% approval he'll be just as powerful as he is today. Remember that when thing begin to go a way that's not good for passive shareholders of US corporations.

With the “democrat” senators just today voting unanimously to keep men in women sports…that 30% approval might take a while.

I agree, I come here to read about business and Berkshire. I can’t help responding when I read such a silly and misinformed post! I would never start one, but can’t help getting worked up and responding to uninformed fake news watchers.

I think I just barfed a little. I tasted a little irony, wrapped in congealed hubris.

How about honoring Manlobbi's request to stop posting political rants on investing boards and take it to the "Political Asylum" board that he created for that specific purpose.


I agree with RayVT's overall view on this. Some of the comments so far do seem purely political (IMO) and hence quite OT.

Discussing the effect of tariffs on BRK, or generally on the economy, would seem 'on topic' for this board.
Discussing personal political viewpoints is 'off topic' for this board.

Hopefully, we can all agree that this board is very valuable, in large part because Manlobbi put so much work into creating it and thus enabling members to post very valuable content on it, that none of us would want to see the value destroyed by OT political discussion.

dealraker writes:

"My guess it is going populist far more than capitalist. All us US'ers who voted to make sure the libs didn't get the power (with good reason) elected something I think we are going to regret. With 30% approval he'll be just as powerful as he is today. Remember that when thing begin to go a way that's not good for passive shareholders of US corporations."

So, are you reducing your stock portfolio or just venting?

“Hopefully, we can all agree that this board is very valuable, in large part because Manlobbi put so much work into creating it and thus enabling members to post very valuable content on it, that none of us would want to see the value destroyed by OT political discussion.”

Well said & 200% Agree! Let’s respect Manlobbi and his very reasonable request and fellow posters that visit this wonderful community for Berkshire related thoughts and info, especially since there is another board entirely designed for those that want to engage in heated heated political & policy debates. Thanks

WEB as to venting or reducing I have far-far-far-far-far more cash on hand in treasuries than ever in my life both in size and in percentage. Again my situation is blandly out in the open and it takes all of a few seconds to see how ole deal is progressing/regressing.

high 30% in Berk
low 40% in AJ Gallagher

The next bunch gets me over the 90% mark in ranked in order of size:

Meta
Fairfax
Lowe's
Brown and Brown
Erie Indemnity
Norfolk Southern
Coke
Pepsi
Mondelez
Hershey (My outlay recently in Hershey was the largest stock outlay I have ever made)
BAM and BN


So I can't run or hide but because of time I do have far more coming in than going out and I can accumulate cash that seems relevant to me in a hurry.

With the “democrat” senators just today voting unanimously to keep men in women sports…that 30% approval might take a while.

You are complaining about women being forced to accept something they don't want. But you have no problem forcing the board to accept something it doesn't want <:-)

Sorry couldn't resist making a light hearted comment. Please don't take above seriously.

Joking aside, nobody is a snowflake here. The board doesn't need to be a Safe Space from politics. Many have correctly pointed out that politics and policy have an impact on investing and it's hard to separate. Still, in the interest of maintaining a good board culture, it behooves us not to cross the line into posting personal political opinions which have absolutely nothing whatsoever to do with investing. It's a slippery slope to chaos!

I estimate the collective net worth of board participants to be north of 100 million dollars. Clearly it's a very valuable gathering place! If we can keep ourselves and this board going for a few decades more, our collective net worth could be in the billons <:-) Unfortunately we don't have a "Howard" to help us maintain board culture. We all have to take ownership and do it together.

The problem with political opinions is that one against better knowledge is tempted to reply or rather attack if someone utters an opinion which is completely contrary one´s own view of the world. Because that´s what politics is about: One´s view of the world. And if that is attacked it is taken as a very personal thing, as it concerns one´s very core, as if we are attacked. Even Jim who is so much more restrained than I am some posts ago couldn´t resist this temptation, or rather ´craving´, to ´correct´ someones ´obviously´ wrong political(!) view. As less can weak me resist this temptation. Therefore I egoistically would like to second this ´slippery slope´ warning. Yes, we are as just was just said ´together here´, but definitely not on politics, so please let us fight (because that´s unavoidably what it always is) somewhere else.

Regardless of politics, and he stop-and-go implementation, following effects seem to be reasonably plausible.
(Considering purely economic effects regardless of human cost (paid by Americans and foreigners both).)

Some tarriffs - basically an increase in consumption taxes, mostly hitting poor and middle class. Also, exports hurt due to retaliatory tariffs by others.

Some reduction in Federal workforce - same as above. Plus recessionary pressure - higher unemployment, less money to spend.

Alignment with Russia against Ukraine - maybe better trade deals (one hopes), less spending on NATO, net savings for US taxpayers.

No foreign aid (except to Israel) - net savings to US taxpayers.

Tax cuts for the rich - net recessionary as money goes into assets instead of spending.

Short term, lower budget deficit (likely paving way to more tax cuts), indeterminate effect on trade deficit but likely much lower as well. Long term, TBD.

It's only been 1.5 months since la revolución. Someone with a better crystal ball please correct me.

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