Why You Shouldn’t Sell Stocks During Tariff Wars
Disclaimer: Good Day, Readers. WealthBuildingPowers blog is a financial literacy/competency blog and does not provide specific investment recommendations.
TARIFF WARS – THIS TOO SHALL PASS!
More people have walked on the moon than sold their stocks precisely at the high point! On April 3-4, 2025, the market lost about $6 trillion when Trump introduced U.S. “Reciprocal Tariffs.” President Trump went beyond equal tariffs and announced military-grade, shock-and-awe tariffs. His agenda is simple and very difficult. He wants to restore the “Rust Belt” and other parts of the U.S. to their former manufacturing glory.
The Rust Belt
I am embarrassed to say I did not know where the term rust belt originated. The northeastern and midwestern United States was once the heart of American heavy industry, particularly steel, coal, and manufacturing. These industries died in the late 20th century, leaving behind abandoned, rusting factories, high unemployment, and economic distress. The “rust” symbolizes the decay of once-booming industrial areas.
The decline began in the 1950s and accelerated in the 1970s and 1980s due to several factors:
- Global Competition; Technological Advancements – Automation reduced the need for manual labor; Economic Shifts: The U.S. economy transitioned from manufacturing to service-oriented industries; High Labor Costs – Companies moved operations to regions with lower costs, like the Sun Belt or overseas; Chasing Cheap Goods
This led to widespread unemployment, population loss, and urban decay in many cities within the Rust Belt.
Attempting to Reverse the Decline of the Rust Belt with Punishing Reciprocal Tariffs
The U.S. imported $1.2 trillion more in goods in 2024 than it exported. This trade imbalance has been a catalyst for the destruction of America’s Middle Class and the American Dream. Two of my family members worked at GE, making excellent wages and a generous pension. They built homes and sent their kids to college. Their old jobs and millions more WERE GIVEN to China, Vietnam, Mexico, and other cheap labor countries. Pensions are a thing of the past.
You will not achieve the American Dream of buying a home while working in a fast-food restaurant or holding three low-wage part-time jobs.
For decades, watching the decline of U.S. manufacturing has been like watching a 15-round heavyweight boxing match. They no longer allow 15 rounds and only give these large men 36 minutes divided by 12 rounds to try and kill each other. Watching the attempt to revitalize the Rust Belt with a focus on education, infrastructure, and attracting new industries has been like watching a losing boxer being told in the latter rounds you are losing and need a knockout.
The administration wants to level the trading field and give the middle class a better future. Last week, Coach Trump whispered to his team that we needed a knockout, and they launched new reciprocal trades that anyone using Google or an AI chat box quickly saw significantly exceeded other countries’ tariffs. In some countries, barriers, such as VAT taxes, additional expenses, and costly regulatory costs applied to U.S. manufacturers, etc., make our products uncompetitive.
Over several years, the difference between the haves and the have-nots has worsened dramatically, partly because we lost tens of millions of good jobs!
Tariffs Paused, April 9, 2025, but We Are Still In a Trade War With Dozens of Countries
My stock portfolio suffered severe “paper” losses from April 3- 8. I did not sell. Bad sell-offs are typically followed by a strong bounce back. Today, April 9, I regained about 40% of my paper losses. I am glad I did not sell.
According to JPMorgan Asset Management’s research, “the market’s best days follow the worst days closely.“
Is it possible to build new manufacturing plants in our country?
Today, we lack the necessary skills for millions of NEW high-tech manufacturing jobs utilizing robotics and AI. The Midwest is home to several top-ranked universities that foster engineering and technology talent. Initiatives like workforce development partnerships with universities and companies are helping bridge this gap.
TO RESHORE MILLIONS OF GOOD PAYING TECH, TRADE, AND HOURLY JOBS, WE MUST RESKILL!
Is This A Good Strategy?
I have no idea if this is a good strategy, BUT, I support the intent.
China utilizes the world’s dependence on poor quality, cheap goods, and trade imbalance to fund a growing military. China is an enemy!
The paths to financial freedom are UNLIMITED. CHOOSE YOUR OWN!
LET’S MAKE SOME MONEY – CRYPTOCURRENCY IS ACCEPTED!
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ABOUT ME
I am a proud nerd (as my beautiful wife and daughter have told me) investment and finance blogger with an NC. State, Chemical Engineering, University Rutgers, MBA and Harvard University, Advanced Management education.
I left a corporate career because I desired to make a difference as a speaker and writer. I was blessed to be coached and mentored by strong women and men in my family and professional life. It is my time to serve and give back.
DISCLAIMER
I started my first business at ~13 years of age (a small but brilliantly created plant nursery). I am a successful investor in stocks, options, and real estate and am happy to share my finance and investment lessons. I am NOT a licensed financial advisor. Please do not construe my suggestions on this blog as recommendations for your situation. As an investor, you must establish your risk/loss tolerance. Investment in any asset involves risk, including complete loss.
Please seek your licensed CPA or fiduciary financial advisors for individual financial advice.
I write this weekly blog to make an impact by reaching an audience and demonstrating the need for financial literacy. I will help you get there.
