Good morning. After a few uncomfortable weeks for investors, markets are on the rise as the White House appears to be signaling that tariffs might not be as sharp as was considered just last week. Confused? Join the club. It seems the threat of tariffs have been tossed around as a weapon not only to get “fair and reciprocal” pricing of goods, but to reach other goals. For example, just in the last hour it is being reported that the U.S. will impose a 25% tariff on any country importing oil or gas from Venezuela (source: Bloomberg) but it is not called a tariff, but a “secondary tariff.” And, according to U.S. Energy Information Administration, the third largest source of crude oil coming into the U.S. as recently as December was … well … Venezuela. What? Should we tariff ourselves? As mentioned last week regarding the tariffs is how to handle the uncertainty … as we don’t really know to what degree things will change leading up to “Liberation Day” of April 2. And what does it really mean? Will that be the day when things are set in stone (removing uncertainty) … or can things change again on the following day … or the day after … or the day after that? For a business owner (and to some degree, a consumer) it makes planning impossible. Meanwhile, another effect is on GDP … as Daily Shot gives the view that “…the longer trade policy uncertainty persists, the more significant the drag on real GDP …” Fortunately, the American consumer … due their spending habit … has been holding up the economy but Pantheon Economics claims purchases are slowing this quarter while an article in Bloomberg asks the terrifying question of “what if the rich stop spending?” … something too scary to consider right now. One other thing that caught my eye was a report showing the decline in the number of births in the U.S. … so I went looking around and see a drop (choosing a 15-year period) of around 15% from 2007 through 2022. My gosh, think of how much this affects … such as diapers, school attendance, home sizes, social security and even boxes of Froot Loops. Demographic shifts have an effect on so many things … and for populations around the globe, the downward projection does not seem as if it is a trend that will change any time soon. Okay, that will wrap it up for me today. I met a friend over the weekend, who married a woman he met at the local hospital. Going in for an Xray, they met as she was the radiologist who did the examination … … though, quite frankly, I can’t figure out what she saw in him. Have a great day, Joseph G. Witthohn, CFA Have any questions? Please contact info@teamemerald.com
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