The Tariff Tantrum, Economic Fears & Opportunities – Top 3 Takeaways – April 8th, 2025 - Driven By Braman Motorcars
Takeaway #1: The ‘tariff tantrum’
Economic fear won the day to start the day yet again on Monday as tariff talk is pretty much all of the talk that you hear just about everywhere and about everything. Should I be buying stuff? Should I be waiting? Are we already in a recession? These are the kinds of questions that I was asked all throughout the day yesterday. And based upon where you go for information, and based upon what you want to hear, it’s easy to be instilled with varying levels of fear. This is why my first rule of money is to never let your money and emotions cross paths. Inflection points like this can be historically great opportunities or they can serve as economic tragedies based upon the way that they’re played. If you’re concerned but don’t know what to do...doing nothing is generally a good thing to do. With that said as I mentioned yesterday buying appliances, clothing and electronics if you’re inclined is probably a good idea provided that you’re not running up credit card debt to it. Ditto buying a new car if you were about to is also a good thing to be doing. Panicking and being full of fear is never a good thing to do but especially with what’s happening right now. Yesterday Blackrock’s Larry Fink said “most CEOs I talk to would say we are probably in a recession right now”. That may end up proving true, but even if it is, it could also prove to be as short lived as the recession during the pandemic. That’s because...
Takeaway #2: This time is different
In part because of what Fink thinks the stock market started yesterday with losses mirroring what we saw last Thursday and Friday. Fear mongers were talking about the potential for a Black Monday and fast and furious selling ensued at the start of the day...but it didn’t stay that way for long. And whether yesterday’s trading potentially marked a bottom (though using history as a guide I wouldn’t bet on it – if nothing else we’ll likely test at least those lows again). But the reason fear didn’t win by the end of the day is ultimately because this bear market, this economy, and for that matter this president is different. Do you know what the average credit score is at the onset of a recession? 675. Do you know what it is today? 717. Do you know what the average unemployment rate is at the start of a recession? It’s 4.7%. What’s the current unemployment rate? 4.2%. Do you know what the average monthly jobs report preceding a recession shows? A gain of only 37,000 jobs. What did the March report show? A gain of 228,000 jobs. I could continue but you get the idea. Nothing about the current economic landscape suggests that this is or would be a typical recession. The situation we’re currently in is most similar to what we briefly went through at the onset of the pandemic. People who panicked sold stocks at lows and passed up opportunities in real estate as well. This time is different because what we’re experiencing isn’t due to macro-economic factors or bad decisions being made due to a virus. It's due to a rapid shift in executive policy that could change at any time. Consider that for all that’s happened over the past week, President Trump’s tariffs announced last Wednesday still haven’t hit. They don’t take effect until Wednesday and as we know over 70 countries including all of our major trading partners, except for China, are currently negotiating with President Trump for a way to avoid the impact of his tariff policies. In other words, there’s still a chance that much of the tariff impact doesn’t hit. That’s still to be determined based upon whether President Trump feels that he’s being offered good enough deals.
Takeaway #3: What are your goals?
Right now is a time to be opportunistic even if you’re not especially optimistic. As this sudden bit of adversity has turned much of the economy on its head, look to take advantage of opportunities that fit your strengths and circumstances. Economic downturns, while challenging, often create unique openings—whether it’s snapping up undervalued assets or capitalizing on shifts in consumer behavior. The key is to act decisively while others hesitate, positioning yourself for the eventual recovery. Even if Fink is right and there’s more to this – like a recession, consider this... during the Great Recession, which began in December 2007, the S&P 500 dropped nearly 57% from its peak by March 2009, yet those who invested at the trough saw gains exceeding 400% over the next decade. Similarly, the COVID-19 recession in February 2020 saw unemployment spike to 14.8% by April, but sectors like e-commerce and remote tech boomed and unemployment rates quickly came down. History shows that adversity breeds opportunity. The key is spotting it amid the noise and acting before the crowd catches on. So, what are your goals? Right now, with all of the uncertainty is a great time to be looking for opportunities that will help you achieve them.