r/stocks • u/Chrissylumpy21 • 23h ago
Crystal Ball Post Is Black Monday Incoming?
So much fear in the markets and this time really feels different. All the Mag7 stocks are so hit by the tariffs our iPhones will probably cost $5,000 soon and as the world slows, people will use Amazon less, advertise less on FB/IG. No one is buying Tesla anymore. Who needs anymore AI chips, yet AI is decreasing Google searches.
I fear the world is realizing it all this weekend. Or is it just me that sky appears to be falling?
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u/Solidplum101 23h ago
Its amazing to see the same people on here bullish literally a week ago 180.
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u/undonedomm 19h ago
Sometimes you just have to accept the bear, cash is king and also puts
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u/Tricky-Ad-6225 11h ago
Go cash or lube your ass
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u/genericusername71 20h ago
great time to increase dca’ing
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u/Tookmyprawns 18h ago
Great time to hold onto some cash and wait it out. This feels like something that will increase inflation, lead to higher rates, and job losses for a while.
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u/LoweringPass 17h ago
Why would you hold onto cash when you're expecting increased inflation...
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u/Warthog_Orgy_Fart 10h ago
Because even getting 4% in a HYSA or money market is better than hemorrhaging money in the market.
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u/Ready-Taste9538 15h ago
Because once you’ve lost half of your capital in the market, and prices explode, some people will have to sell to pay their bills. And also because the smartest, most successful, investors in the world are sitting on mountains of cash and have been since December?
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u/boetelezi 15h ago
That is what traders do. Take the interest until they can determine the direction of the market. Sure, that is not a good long term strategy, but fine short term.
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u/Quiet_Government2222 14h ago
Because the possibility of hyperinflation has increased significantly. If not, short-term bonds may be better.
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u/MentalRental 12h ago
Because keeping your money in equities means you lose actual money instead of just purchasing power.
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u/WinterHill 15h ago
If you’re choosing when to increase and decrease your level of dca’ing based on market signals, then you’re not really dca’ing, are you?
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u/Savings-Program2184 13h ago
Imagine DCAing from 1929 to 1953 “see! see! I broke even” (dies of old age)
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u/PontificatinPlatypus 21h ago
It'll rally 20-30 points Monday, and then lose 3000 on Tuesday.
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u/I-STATE-FACTS 19h ago
Yea I’m thinking slightly green monday followed by more carnage.
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u/stanpan 16h ago
I feel like the weekend doom will carryover into Monday, it’s probably still gonna continue to drop
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u/nanopicofared 14h ago
Strongly depends on what other countries announce retaliatory measures. I'm expecting the EU to weigh in on Monday.
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u/kopeezie 11h ago
Yup, Dead cat bounce!
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u/Free-Competition-241 9h ago
Definitely a dead cat bounce at some point next week. I’m sure another country will “call” Trump to negotiate.
“Trade talks going well!”
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u/Yeti_Urine 11h ago
That seems to be what the market used to do. However… this time, I think it just continues to sink hard. Powell signaled rates are not longer going down, and in fact in consideration of going up. That should roil the markets good on Monday. And maybe we’ll get Euro retaliation too… it’s gonna be brutal. I wanna seriously do some yelling in the direction of those I know voted for this clown show.
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u/Individual-Dot-9605 18h ago
Yea I also think the patient will have fake recoveries, the real depression will hit when Trump announces a third term or Ukraine falls to the Kremlin or China takes Taiwan and trump starts scouting he is a peace president and just freezes. US is looking weak and xenophobic only Vance talks tough.
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u/alba_Phenom 16h ago
Vance talks tough?
Yeah on his allies and harmless nations like Greenland maybe.
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u/NivvyMiz 23h ago
I was wondering the Powell comments about inflation and interest rates have quite sunk in. Have we already ju.ped off that particular ledge?
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u/Beautiful-Law2500 22h ago
I think JP did what we were expecting.. nothing.
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u/callmesandycohen 18h ago
JP sees incoming inflation on the horizon and Trump is asking him to lower rates? Not to mention Trump is going to practically stop USD outflows to trade deficit partners making their ability to pay for US treasuries more difficult. The demand for US bonds abroad will plummet. What happens then?
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u/Fluffy_Monk777 7h ago
Yep, if anything the fed will raise rates not lower them. Anyone who is saying the fed will lower I don’t listen to their advice because it shows they do not understand basic things.
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u/aomt 13h ago
Honestly, I think JP is doing amazing job. He is very neutral and manages to guide market in the right direction without creating waves. Imagine if he said “omg, that’s horrible, we are doomed!!!? Or the opposite and set of market rally In this conditions. Considering his job - he doing it perfectly.
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u/FEMA_Camp_Survivor 18h ago
FWIW, Project 2025 proposed a return to free banking and eliminating the Fed among a menu of options. There’s a risk that independent monetary policy might not last.
It’d be another catastrophic blow to America’s economy and influence.
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u/Indoor_Cat_9719 12h ago
For someone who "didn't know anything" about Project 2025, Dump sure is managing to follow it step by step
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u/stonewallace17 6h ago
To be fair absolutely nobody could have ever seen it coming. It's not like it was published on the internet, and it's not like Trump was closely associated with major contributors to it. And it's certainly not like the DEI hire running against him ever brought it up on national television.
/s just in case
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u/Lumiafan 13h ago
The country would collapse if we're being real about it.
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u/Fluffy_Monk777 7h ago
Glad you said this. Abolishing the fed is on the project 2025 list. That alone would be catastrophic to the U.S. economy and US dollar. I do not say that lightly. At all.
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u/btbtbtmakii 11h ago
Jp for the past yrs had always followed the data, don’t know what ppl are expecting
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u/NegotiationJumpy4837 21h ago
I'm assuming that was expected. Higher inflation seems like a completely obvious consequence, in which case, he can't really lower rates.
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u/RustyNK 21h ago
Yeah, I don't know if there's anything the FED can even do right now. It's not a monetary issue. It's 100% generated by the fiscal side of the house. FED can't do shit about any of this, and you would be screwed either way by lowering or raising rates.
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u/Myomyw 20h ago
It could be higher inflation. It could also be massive job loss and everyone is afraid to spend and we get a huge recession which forces the fed to lower rates.
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u/BowlAcademic9278 22h ago
We also haven't heard what the tariffs will be on semiconductors and pharma!
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u/crazyrichmaya 23h ago
Remember the old adage...You never really appreciate the gains but stare for hours at the losses.
Your in for the long term so there will be market corrections. Don't worry and hold steady
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u/Beastman5000 22h ago
Whenever the market rises it feels like you earned it and the gains are rightfully yours. But when there’s a market drop, it feels like something is being stolen!
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u/PepeSylvia11 18h ago
This is sound advice in a stable, predictable market.
We are not in that.
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u/ReactorTractor 15h ago
Lot of people said that during the COVID drop. Far more extreme events and look how that turned out.
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u/someasics 11h ago
Covid was different, the whole world was going through it together. What Trump is doing is ending decades of prosperous Global trade and isolating the US which was at the center of all that. We’re entering unprecedented territory so I’m reallocating my whole portfolio because I have no clue what’s coming next😬
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u/fuglysc 15h ago
I know Trump has given every indication that he doesn't care about the markets this time around...but if the SPY hits bear market territory of 490 in the next week or so, I'm certain he will start backtracking on tariffs by offering concessions to do away with the reciprocal tariffs on any country that comes to the negotiating table...there won't even need to be any hardline negotiating...it could be as simple as XXX country is willing to buy a billion more US agricultural products and he will consider that a victory and drop reciprocal tariffs
And then over time, he will come up with an excuse to remove the blanket 10% tariff on all countries with some made up shit like "mission accomplished...countries are fair to us and treating us with respect again"
There will be legit fear from the administration not because the markets entered bear territory...but because of how quickly it's gotten there...when it crashed because of a black swan event like CoVid, Trump could at least deflect responsibility...but if markets crash because of his trade policy, it will land responsibility squarely on his shoulders...and just the non stop backlash from the media and other countries and general population will be too burdensome to bear
We shouldn't forget that a lot of politicians own stocks...and if what Trump is doing endangers their portfolios, it won't matter what party they belong to...they will start to dissent...the Senate already has members willing to cross party lines to vote against his tariffs on Canada...Membets of the house will eventually do the same...and Trump is not so clueless to realise that if he messes up the markets badly enough, there is no chance the Republicans win the mid terms...and the potential loss of power for the final two years of his term will be hellish for him
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u/Wubbywub 10h ago
you say it like they are not allowed to short anything, who knows they may "be winning" with puts
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u/WrongWire 14h ago
I'm not convinced he'll backtrack tbh.
Partly because I think he's trying to engineer conditions for martial law and never leaving office, but also because the rest of the world is sick of his shit and aren't going to provide the cover for him backing off.
He's as likely to double down and make things worse.
Further capitulation to Putin and the loss of Ukrainian borders to Russia will damage markets further even if there is 'peace' and the allies he's been threatening and economically attacking aren't going to forget about it if he decides to stop being a dick.
Tldr - cash til Tuesday, keep some power dry for EU response
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u/Aware-Impact-1981 13h ago
I'm also not convinced this whole "bring manufacturing back" is just a talking point to him. He's harped on it since 2015. He genuinely seems to think that's the key to a positive lasting legacy.
Now yes, he also genuinely seems to view the stock market as part of his legacy, and his desire for praise means he's fairly short sighted. I could see him removing the tariffs to stop the immediate blowback. BUT, I could also see him putting manufacturing above stocks, especially with his comments going on a year now that the transition would have "some pain" associated with it. I think he might be prepared to plow on with his stupidity this time, and he's got nothing but loyalists around him this Tim
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u/DiscountAcrobatic356 12h ago
Yep. I’m over 80% cash. Got a few utilities - even they went down Friday.
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u/No-Fun6980 8h ago
on the other hand I am quite fucked. I pulled some I could that was in green but about 50% of me is in equity. 30% in cash, rest in gold and debt.
and I don't have much, I am a young man with responsibilities as my sister is about to start college.
my only hope is that nice tech job I have lined up and starting next week. I hope that doesn't get affected 😭
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u/Annihilator4413 9h ago
Trump may be willing to roll back the tariffs, but what incentives will the rest of the world have to roll back their reciprocal tariffs? The US may have some leverage, but I think the rest of the world has the upper hand overall since the US buys more than it exports. And why would a country trust Trump at all when he has a VERY hard time keeping his word?
Trump will have to bend over backwards to get other countries to stop their tariffs, and we all know he's too narcissistic for that.
So expect a black Monday.... and Tuesday. And Wednesday. And Thursday. And Friday... all the way up until our economy is little more than mush at the bottom of the compoat bin.
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u/Logical-Race8871 18h ago edited 18h ago
It's been pointed out that they haven't actually deregulated anything - despite all these EO's, all the laws, procedures, and policies for regulations and regulatory compliance are still on the books, and definitely would require congress to actually negate or change (and a couple years worth of sessions, at that, to even put a dent in the regulations). Baring EO's negating each regulation, or EO's that just say "all crime is legal", that's where we are at with regulations as of April 5th, 2025.
They have, however, cut basically 25-75% of the federal staff required for companies to comply with regulatory law. There's not enough federal workers - or in some cases nobody - to sign off, review, or inspect industrial and construction projects, mergers, what have you. They didn't just fire all the regulatory enforcement and butt-spankers- they did a blanket reduction in force for the entire compliance system itself, without getting rid of the laws.
There is a shitload of regulatory gates in the construction and manufacturing industry, and they just locked those and threw away the keys. It would be illegal, as the laws are written, for companies to proceed on projects or plans without the federal half of the equation, which this administration just shot in the head, and then also shot the companies in the dick with tariffs for good measure.
It was also pointed out that you really can't insure new equipment or projects that are wantonly out of compliance and unapproved...
All the focus this week is on these tariffs, which are insane, but the economic nuke that is the slow-down and collapse of a huge chunk of the entire public-private regulatory compliance apparatus is still falling, and will play out over the next few months.
Not really much to recommend with regards to American stocks, other than find something that is needed and completely, absolutely unregulated, or don't be in or hold investments in America by summertime.
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u/TheFireFlaamee 13h ago
It's true the regulatory laws still exist even if there are promises not to enforce them. A legal quagmire.
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u/kopeezie 23h ago
Agreed.
1) Need either capitulation to set in. 2) reason for positive earnings outlook. 3) reversal.
I see two more episodes, given the previous week and end of feb one, before a true bottom.
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u/CaptanTypoe 23h ago
Hard to call a bottom when we have no idea what is coming next. Very different bottom scenarios if Trump caves this weekend vs. keeps this in place for 2yrs.
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u/mpoozd 22h ago
He threatened Iran too, B2 boomers already deployed near Indian ocean god knows what's the next crazy shit.
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u/Comfortable-Pause279 21h ago
These last four months have been exhausting. It's startling he can pack so much psychotic bullshit into it.
It didn't used to be this way: in the summer of 2001 we had the "Summer of the Shark" because US media didn't have enough stories to cover.
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u/OrneryZombie1983 13h ago
No meaningful elections this year so Trump won't care about the markets until 2026. He's the kind of guy that would crash the Dow to 20k and then campaign during the midterms bragging about a recent pop to 30k.
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u/Joeyfingis 22h ago
Trump is the kind of moron who doesn't know how to cave. Plus he answers to Putin and this is all great for Russia.
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u/i-can-sleep-for-days 19h ago
They are thinking about a recession in Q3 and Q4 so that meaans the bottom is around the summer?
But I kind of doubt it. For recovery to really take place the market needs assurances that there are good and steady policies and competent people in charge. Since employment in this administration is based on loyality not merit and the severe incompetence they have displayed, it's hard to believe there will be a steady recovery even if we reversed course right now.
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u/lostredditorlurking 22h ago
I see two more episodes, given the previous week and end of feb one, before a true bottom.
We hit a bottom, and then Trump made up some bullshit excuses to invade Canada or Greenland
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u/futurespacecadet 23h ago
it felt like today was the blow off top tbh, -6% move?? after another -5% day?
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u/skimcpip 23h ago
Said on Black Friday before black Monday, 1987.
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u/futurespacecadet 23h ago
looked into the possibility of Orange Monday, and according to Claude AI:
The week before Black Monday showed significant weakness:
- Wednesday, October 14: Market fell 3.8%
- Thursday, October 15: Another drop of 2.4%
- Friday, October 16: Down another 4.6%
This meant the market had already declined nearly 11% in just the three trading days before Black Monday's catastrophic 22.6% single-day crash.
Several market conditions resembled what you're describing now:
- Rising interest rates and inflation concerns
- International tensions (particularly with trading partners)
- A sharp spike in the VIX (though it wasn't called that then) in the days before the crash
- Computerized trading programs (portfolio insurance) accelerating selling
One notable difference: The 1987 crash occurred during a fundamentally strong economy, similar to today's situation where economic data remains mixed rather than universally negative despite market fears.
The pattern of accelerating declines leading to a climactic selling day has repeated in many major market corrections, though rarely with the single-day severity of 1987. This historical perspective reinforces the value of patience and avoiding reactive decisions during periods of extreme volatility.
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u/BowlAcademic9278 22h ago
How do we get the mods to pin the above comment?
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u/craaazygraaace 21h ago
I don't know anything about stocks and never come to this sub, but I'm updooting for "Orange Monday"
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u/ThenExtension9196 20h ago
-22% incoming when Europe tariffs digital goods aka our bread and butter
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u/PepeSylvia11 18h ago
Said on Black Thursday before Black Tuesday, 1929.
Guess how long it took for the market to reach its true bottom after that? 3 years.
And that’s to reach its bottom, not to reclaim what was lost.
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u/pbwra 22h ago
I mean if you think the S&P 500 companies are not premium offerings in a heavily tariffed environment, and therefore don't warrant a premium multiple, and think their earnings guidance might falter in the next round of earnings in the next month, where might it end up? A normal PE of like 16 as against the 22ish it has fallen to, with reduced earnings instead of projected earnings growth, could still see 40% down from here and that is just a re-rating and ignores any serious negative sentiment like capitulation or other trade related headwinds.
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u/Presidential_Rapist 22h ago
There are a lot of bubbles out there, but there kind of always is. There's probably more innovation than ever because while dreams of AGI and ASI level AI might be hype, the narrow scope AI is pretty good for object recognition, new drug candidates, new material science and many other narrow forms of automation/large dataset parsing with automated branching logic or adaptive algorithums if you want to think about it in verbose terms.
Adaptive algorithms are still a big deal even if you don't get human level AI intelligence or reliable full self driving anytime soon. Like computers the narrow scope AI still has a lot of potential to increase innovation and automation while opening up new business models.
I think we should expect prices increases more like 20-30%. Enough to cause a recession, but not enough to make US manufacturing significantly more vaiable in most sectors. US wages are just too high relative to most of the rest of the world and you'd need tarifs more like 500% to get the effect Trump seems to want.
Markets speculate and guess and panic a lot, but they mostly suck at predicting the future. Never trust market speculation! It's a bunch of pump and dump and like 10% reality.
Politically even 20-30% prices increases are probably somewhat of a death sentence for Trump, but it's not a static target. Republicans or Trump can cut tariffs at any point AND resort to stimulis spending.
The Great Depression was a time when government didn't have developed tools to react to an industrial nations economic ups and downs. Even small government loving Republicans are likely to resort to high deficit spending against their promises if the shit hits the fan that bad and unlike 100 years ago they won't wait for years for natural self correction.
They might drag their feet for awhile, but if it's that bad they'll cave, drop the tariffs and Borrow and Spend like mad.
The problem is The Great Depression didn't happen overnight and it might take 2-3 years of pain for them to realize there's no boom coming, but they also might react and listen to market speculation a bit more than in the past.
What's not going to happen is US manufacturing replacing cheap foreign labor cost effectively or ramping up to replace most Chinese exports in just 2 years. To do that you'd need to raise wages along with increasing the price of goods and Republicans are too scared of inflation after winning the last election on inflation.
The GOP itself would not enact tariffs like this, they are just cowards against Trump because they have no other popular candidates or personas to stand up to him. This is often how populism works. Very few facts and few opposing people who can work the crowd like their new cult leader. It's a weakness of the human mind, likely from being simple animals for most of our evolution. We are programmed to follow a pack/tribal leader and be easily polarized as well as respond to fear based messaging more than reasoning. Fear is universal, reasoning takes effort and fear keeps you alive better than your simple land mammal brain trying to figure out what's really going on. Negative stimulus is always draws the most powerful reaction and populists mostly always use that just like Trump has.
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u/Jmsjss2912 14h ago
Let’s talk about the tariffs and the effects it has on the manufacturers of this country.
Assume for a minute that you wanted to bring back some manufacturing to the USA, which of course is a huge assumption compared to manufacturing outside the country like we do as a company.
Which I will get to in just a moment. This week alone the stock market lost over US$9 trillion which means every single manufacturer that has a US corporation is part of that loss. Which goes to show you that Trump‘s logic is about as efficient as his spray tan.
If these companies even had a thought of coming back to the United States, all of their cash has now evaporated because of the loss in the stock market so who’s going to finance these new manufacturing plants that Trump keeps talking about, that are going to come back here make the economy great?
Now goods have gone up in price in some cases doubled already this week which means the consumers are going to be buying less. Companies are going to begin layoffs, because they’ve lost a huge portion of their cash reserves. Their businesses are going to be diminished some because of the lower purchasing rate and the higher pricing.
Bringing manufacturing back to the United States at this point with this approach has been almost completely eliminated.
All you have to do is go back and look at what happened during the depression when they tried to institute tariffs causing the depression to take even a further nose dive and adding years into the depressive point. It’s such a joke that they used it in the movie Ferris Bueller‘s Day off where the teacher was talking about how bad tariffs are and how they caused the depression to go down, which goes to show you that if they use it as a punchline, then it obviously cannot work.
With our business, we were building some manufacturing plants in the United States and now have had to put it on hold because of the tariffs. As an example, each of our production lines has a manufacturing cost of a little under US$5 million, we did try to price it in the United States but we found quotes anywhere from $12-$16 million for the same exact production line that we are having made in China. So we couldn’t make the equipment in the United States, but we were going to import it and set up manufacturing plants.
One of them was in Arkansas where the state is somewhat depressed. Now we have put that project on hold with approximately 1800 people we were going to hire.
The reason for that is not just the tariffs, from the equipment if you think about it a piece of equipment that cost me $5 million is now going to cost me about $9 million. Each production line generates about US$35 million of revenue so it’s not just a tariff in my situation it’s the fact that for $9 million I can have practically two production lines generating $70 million of income compared to the same $9 million generating $35 million worth of income, with a much lower profit margin because of the labor cost in the United States along with all the taxes and liability issues that you carry because of the litigious nature of the United States operating.
So tariffs do not work, they hurt the economy. The only thing that they do on the surface is generate more tax dollars for the US government, but they diminish and wipe out the middle and lower class.
Do you want to bring manufacturing back to the United States?
You’ve got to do something about all of the litigious actions, you have to lower healthcare cost, lower pharmaceutical cost, have to educate more so that children can grow up and learn trades.
You have to find ways to lower the cost of living and once you start doing that then laboring jobs will become available again.
The next problem is the taxation situation is off-balance. We have structured our tax code so that the wealthy and the publicly traded companies that offer stock options instead of salaries, which is taxable make it almost impossible to collect tax.
Take Musk for an example from Tesla.
They talk about his $300 billion worth but it’s all in stock and that’s unrealized gains paying no taxes. What he does is he goes to the bank and he borrows money against that stock portfolio, borrowed money is non-taxable income and then he uses that money to live and buy things like he bought Twitter for $44 billion with borrowed money, no taxes paid at all.
And then what he does from there to pay off those loans is he borrows against other portfolios and he just keeps borrowing deferring the taxes.
$300 billion and no taxes paid whereas the employees that work for all those companies have taxes taken out of each paycheck.
Just look salaries up of the top executives around the country and you look at their income, you’ll see that their salaries are generally between one hundred and two hundred thousand US dollars but they earned anywhere from ten to a hundred million dollars a year all in stock options and then they keep those options in stock and then borrow against them so their tax base is almost nothing.
you want to fix the economy. You have to find a way to tax the rich, you’re not going to make them poor, you’re just going to make them help to strengthen the economy.
I almost forgot, tariffs funds go directly to the administration for spending (trump and his team), whereas taxes go through congress for spending
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u/9_v_9 23h ago
People want stuff, people crave power, people like materialistic happiness, people still want to show off. The economy will revive because of the constant hunger of people. I can't say the same about Tesla though.
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u/ToddTheReaper 22h ago
Unless they don’t have the money…
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u/Plastic-Age2609 21h ago
Many people are using credit cards to buy essentials, a crash is coming. Businesses will start to fail like dominos falling, then layoffs, then more businesses closing. Then war started with Iran or cartels in Mexico as a distraction. We are just about to start the real descent into shit show
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u/alexnedea 17h ago
Nobody saying it wont recover. But will it recover in 5 months or 5 years?
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u/IntelligentSorbet271 13h ago
It’s not just you. And I feel like this destruction was done on purpose by this administration. I’m really angry and anxious
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u/ZakaSlocka 23h ago
This is the fear talking which has happened in every dark period in the stock market. It will recover as always. I’m buying while everyone else is fearful and holding long term.
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u/yeswecamp1 22h ago
I love going back to r/stocks posts when the covid crash happend, the most upvotes comments were saying that it would take decades to recover, and 2 months later we were back to all time highs
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u/Main-Perception-3332 22h ago edited 21h ago
We’ve got the opposite bias now due to people failing to correctly understand a categorization problem.
2022 was a growth scare on valuation, but there was little fundamental structural risk. This time it’s a compound crisis that started as a growth scare but was then exacerbated by a far more serious, existential structural threat on the order of what we faced in 2008, with the difference being the situation is being actively driven by reckless policy rather than being moderated by it.
This is a much more dangerous moment than 2022. We’re looking at a resurrection of policies that made the Great Depression Great.
To give you an idea of the severity of what we’re facing: I do work in supply chains for a major US manufacturer. We estimated the tariffs on Canada and Mexico alone would cut our profit margins in half. That does not even include all the new tariffs announced on tariff day. Under these conditions some combination of two things must necessarily happen:
1) Large scale inflation rippling through the economy.
2) A collapse of profits and free cash flow.
Any mix of these of these will lead not only to stock price declines, but compression of PE ratios.
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u/Pretty-Balance-Sheet 21h ago
I love your comment.
People on Reddit talking about this as if it's a normal correction strikes me as blindly simplistic. This is sabotage and as far as I know it's never happened before in the USA. Even previous uses of tariffs were attempted as a fix to a problem. This is not that. It's pitched as a fix, but that's an obvious lie. This intentional crash is unprecedented and who knows where this will end up.
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u/Soultrapped 15h ago
It’s the blind Trump supporters that are acting like this is business as usual…
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u/tombstone1111 15h ago
The only way it ends is if the tariffs are dropped or severely re calculated, can only hope at some point the ego of the man in charge is so hurt by his popularity dropping that he comes to his senses and does some sort of tariff reversal. A narcissist can only last so long without his worshipers…..
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u/HotSunnyDusk 22h ago
The issue here though is that things are gonna get worse for a longer period due to who's in office. He's not going to back down on this, he's just going to quintuple down on more tarrifs till someone gets him to back off of it.
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u/PatrickWhelan 20h ago
This will be the ultimate test of modern political and economic theory, it's hard to imagine the era of free trade ending, the economic interdependence of nations has been a major factor in the (relative) global peace over the last 40 years. Is this going to actually usher in a new model of isolationist economics? Is Trump positioning a US-MX-CA economic block as global manufacturing power? Hard to imagine really - seem more likely pressure from the oligarchs will make these tariffs be somehow defanged over the next few months and things return back to the global normal, of "business as usual".
It seems like the second is, overall, more likely. At the end of the day Trump can't maintain control in a crashed economy and he'll get backed off to try to sustain his power. So maybe we crash another 40% now but I think we might be back on the up tick in 8 months or something. Seems like just chill and ignore the market time
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u/nsfishman 18h ago
Global Free Trade isn’t ending; it’s being forced to create a work around without the USA, by the USA.
Once the other economies of the world achieve some sort of semblance of a stable, workable world economy without the US then the USD is at risk of losing its global currency status. If that happens, then the last few days will be a minor correction compared to the implications of that systemic change.
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u/Chocobops 22h ago
If we didn't hit a circuit breaker Thurs or Fri, I can't imagine what will get us there Monday. We're due a relief bounce and there are gaps to fill. I bought a few speculative calls at end of day today because I would hate to miss a setup for a bounce with so many people piling up on the other side.
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u/DavidGQ 22h ago
I am bearish for the past two months. See my past posts. But be careful to go full port shorts. The bounce is coming and might squeeze some late shorts. Wait for the bounce next week, maybe Monday before reshort. Let the late shorts get squeeze first
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u/Haruspex12 13h ago
I left in November. Trump’s plans were written out. I read them. This is only a surprise in terms of weirdness. He imposed tariffs on a US military base. It’s the only thing on the island.
Since November, I have had a policy of only considering buying US stocks if I could clear an 18% discount rate on cash flows with a margin of safety.
You truly, truly need to read Trump’s executive orders. He ran on this. Democrats tried warning everyone this was going to happen. This is just the beginning of phase one. We are less than one quarter of a year into his presidency. We get to repeat these two months, 24 times over. From everyone that knows Vance personally, he’s worse.
We are still drifting economically from Biden’s policies. The plan is to make life so much worse. This is still the “good old days.”
This is a voluntary choice by the voters. I posted before the inauguration that a PE of 5-10 was the level that now made sense but nothing higher. We are at PE of 24.
If you think you are investing in Biden, Obama or Bush’s America, you have not been reading the plan.
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u/deepfuckingnwell 23h ago
I bought puts. Exciting time.
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u/TaterTotsAndFanta 22h ago
You bought puts after an over 2000 point drop this week? Regards united.
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u/deepfuckingnwell 22h ago
Yes i am still bearish. I am a firm believer that Trump doesn’t have the hubris to fold.
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u/Different-Animator56 20h ago
Let me pile on. I agree with you, but not because of Trump’s hubris. See the Vietnam walk back. It’s easy for Trump to spin anything. But Trump won’t walk back China tariffs and China can’t either. This is the moment they lock horns. All other tariffs can go away but China tariff won’t. This is bigger than Trump.
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u/ChaseballBat 22h ago
I did too. They are now worth 200%...
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u/Stateof10 20h ago
My Disney-specific puts are now up over 275%. Travel demand will crater if this is kept up.
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u/AnyFaithlessness7991 7h ago
iPhone will cost $5,000? what the hell people smoking here?
Are there tarrifs at 400%?
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u/USACivilTsar 22h ago
This day and age we have HUGE global commerce, now compare to 1930 when Hoover implemented tariffs and what happened shortly after... Nearly 100 years later and history is going to repeat itself, all to appease Putin. Trump is most likely has a villa in Moscow-a-Lago when he's ready to bail if he doesn't become dictator of the USSA.
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u/YouDrink 23h ago edited 23h ago
I'm not confident on what Monday will do.
Shits real bad, but the markets pretty oversold from the last two days and about to try at SPX 5000. It could bomb down for a Black Monday, or could dead cat bounce against that support, that I don't think it's guaranteed it'll be deep red.
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u/Lost-Cabinet4843 22h ago
I reckon that it will rally on Monday. And I also reckon only a fool would buy into it. And people who buy into it will say that I am a fool for not buying.
Bottoms form like bathtubs. Then they go up then retest resistance before whipping back up again. I am unconcerned about trying to time a bottom which nobody can do. nor do I think this is a bottom.
But you are right, I believe we will have a rally. It's time to milk retail investors totally dry. Institutions are very good at it.
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u/ValhirFirstThunder 22h ago
The floor is endless and we are but floating feathers swaying in the wind and to the void
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u/SamifromLegoland 12h ago
My man don’t forget a golden principle when it comes to equity. If you lose while everyone loses, you actually don’t lose anything. Keep this in mind and you will sleep better at night.
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u/seethisisland 23h ago
Look at the way it dropped last night...almost -6% on the back of Thursday's -5%. Im expecting some rebound at least on Monday, if not im going to start deploying some cash back in.
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u/ZacharyMorrisPhone 22h ago edited 20h ago
I agree black Monday is a real possibility. But iPhones aren’t going to cost $5000. With current tariffs, even if they stay in China a $1000’phone becomes $1500. That’s a massive increase but most people go on payment plans. So a $48 payment per month becomes $57. People will still buy them. As bad as these tariffs are, I don’t think it’s the end of the world yet.
We also have right wing law firms prepping to sue the president to stop tariffs. It will probably go to the Supreme Court. We also have Congress, who hopefully will do their job and strip the president of these tariff powers. If we do get a black Monday, it’s going to get a lot of these republicans senators on the sidelines to vote. A bill already passed the senate.
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u/midas22 18h ago
I don't think Americans understand how fortunate they have been until now. If you add 50-100% to the price on Chinese made stuff you'll get what we already pay in Europe more or less. Look at a Hisense 65U7NQ tv for example, it's like $629 at Walmart while I have to pay $1100 for it here in the European Union, and that's when it's on sale.
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u/111anza 22h ago
Well, china announced retaliation, so the next big ones will be EU, Japan, Korean, Taiwan
Any of of those will be a 3-5% drop, so worst case, thats another 15-20%, but more realistically it will be about 5-8% because I think they will have a much more measured counter than what China announced
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u/randomguyqwertyi 20h ago
feel like some retaliation is already priced in. It would have to be larger than expected to move the market another 20% down. But hey what do I know
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u/EspectroDK 20h ago
Invest in European stocks instead, we are still open for business 😉
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u/kelsos666 16h ago
Lots of Europeans (some Americans maybe too) wished for a World-ETF without the United States. Deutsche Bank reacted promptly and launched the "MSCI World ex-USA" under its brand xTrackers. (ISIN: IE0006WW1TQ4). From zero to 1.4 Billions AUM within a few months speaks volumes.
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u/Sturdily5092 22h ago
It'll be known as the "Trump Week"... when the rest of the world responds with their own tariffs and the markets tank everyday.
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u/BigBoyYuyuh 21h ago
Yes. Everyone is bailing until they know wtf may be going on or until a true stable market that isn’t America takes hold. America is done, it only took 3-4 months but America is no longer the America we grew up knowing. We’re in free fall and who knows wtf will happen with the states/country.
A reality TV game show host destroyed the country. Makes sense since reality TV already did…it just needed a “host” for the virus/parasite to latch onto.
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u/Effective-Pace-5100 23h ago edited 23h ago
Cmon people, it feels like just yesterday we were talking about how everything is overvalued and we can’t wait for a correction to buy at cheaper prices. Well this is it. Here’s your opportunity. Capitalize on it
ETA- definitely realize this could be much more than just a correction, but if you’re in it for the long haul, this will be a great opportunity
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u/enfuego138 22h ago
That assumes this is a “dip”, which it won’t be if this escalated into a trade war for the next 2-3 years. Ten years of stagflation where we don’t see these highs again until 2040 is not an “opportunity” for most investors.
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u/BowlAcademic9278 22h ago
Plus dip buyers got severely burned buying on Thursday
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u/RoaringPity 23h ago
There's more room to drop. Waiting for EU retaliatory tariff announcement