Enlightenment - A Herold & Lantern Investments Podcast
Enlightenment - A Herold & Lantern Investments Podcast
Trade Wars and Market Woes: The Ripple Effects of Trump's Tariff Bombshell
April 7, 2025 | Season 7 | Episode 13
The financial world is reeling from President Trump's bombshell announcement of sweeping new tariffs on global imports. What started as a seemingly targeted trade policy has exploded into a potential global trade war with far-reaching implications for investors, businesses, and economies worldwide.
Markets have responded with their steepest declines since the COVID crash, with the S&P 500 plummeting 9.1% last week and approaching bear market territory. The "Magnificent 7" tech stocks that drove much of the market's previous gains are all seeing significant drops, while international markets from Japan to Hong Kong have already entered bear markets.
At the heart of this market storm is a fundamental question every investor must now ask themselves: can you tolerate another 10% decline? Your portfolio allocation is being stress-tested in real-time, revealing whether your theoretical risk tolerance matches your actual emotional comfort during market turbulence. If you're losing sleep, unable to eat, or constantly worried, it may be time to adjust your investment strategy to a level where you can function normally.
The new tariff structure includes a universal 10% baseline on all imports with significantly higher rates for countries with large trade deficits - EU (20%), Vietnam (46%), Japan (24%), India (26%), and China facing a staggering 54% or more. Economists estimate these tariffs could potentially reduce GDP by 2.5% while increasing inflation by a similar amount, creating stagflationary pressures.
While markets hope for negotiations that might reduce these tariffs, global reactions have been severe. France's President Macron has called for suspending European investment in the US, Canada has matched tariffs on cars, and China has announced retaliatory 34% tariffs. JP Morgan and Goldman Sachs now predict a 60% chance of recession, potentially rising to 100% if full retaliatory measures take effect.
As you navigate these turbulent waters, consider defensive strategies like high-quality bonds, gold, dividend-paying value stocks, and global diversification. Most importantly, maintain emotional equilibrium - clear thinking is your most valuable asset when markets are in chaos. While disruptions create challenges, they also present opportunities for those with the right perspective and appropriate risk positioning.
** For informational and educational purposes only, not intended as investment advice. Views and opinions are subject to change without notice.
For full disclosures, ADVs, and CRS Forms, please visit https://heroldlantern.com/disclosure **
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And now introducing Mr Keith Lanton.
Keith Lanton:Good morning. Today is Monday, april 7th, first Monday here in the second quarter, and certainly a lot has transpired in this quarter already and we certainly have a ton to talk about after the significant events of last week. Of course, the imposition of tariffs, of course we're going to talk a lot about that and what we should be thinking about, how we should be evaluating the events and what we should be doing to go forward. Obviously, everything is changing super quickly. News flow is at a rapid-fire pace and you need to be mindful of your emotions here as further and further uncertainty unfold and you may, at certain points, think you're getting certainty and then you may get back to uncertainty. So we're going to talk about that.
Keith Lanton:The main thing that we've talked about before, which continues to be the central theme, is your investment allocation. We've talked about this when things were good. Now we'll talk about it when things are more stressed is what is the appropriate allocation for you? We talked about allocation of your portfolio between different investments and the construction of that allocation. It is critically important to make that allocation based on your risk tolerance. We've talked about this over and over again, but here we are stress testing that risk tolerance, so you may have had an allocation that you thought you were comfortable with and the current events may be suggesting to you that perhaps you're not comfortable with your current allocation. You that perhaps you're not comfortable with your current allocation, or, hopefully, that you're extremely comfortable with your allocation and that you set up a plan yourself, with your financial advisor, and you are very comfortable, although certainly stressed, with your current plan. And that's the ideal scenario.
Keith Lanton:But if you're saying to yourself I'm having difficulty, I'm very worried. The question I think you need to ask yourself is can you tolerate another 10% decline in financial markets? And if you answer to that question is that if there's another 10% of decline in financial markets, I will not be able to sleep, I won't be able to eat, I will be extremely uncomfortable. I'm worried about the future, both for myself and for my family. Well, I would say the answer is well, you can't hide and put all your money under your mattress, you can't try and time things down to the moment, but what you should do is perhaps sell enough, and I'm not suggesting this for every portfolio. I'm saying, if you can't take another 10 percent decline, well, you should get yourself to the point where you can, at the very least sleep at night and then go back, talk to your financial advisor. If you're doing it yourself, you probably shouldn't be anymore. Talk to your financial advisor and make sure that you truly can iron out with him or her what your risk tolerance is, so that portfolio going forward can be adjusted and you can remember these moments that we're experiencing now, so that in the future you won't have these moments going forward.
Keith Lanton:So we don't want to panic, even though there's more downside risk. If markets start to price in more recession risk, it's very hard to figure out where the bottom is going to be reached, when stocks will start rebounding after a significant sell-off like we are experiencing at the moment. All that's to say is that there is a chance arguably a good chance that the downtrend in the markets in and of themselves, because of the fact that markets 60% of US population is invested in the stock market, 60% of households and now that we are getting this very rapid decline if this decline were to maintain or accelerate, well, that in itself could push us into a recession. So, even though that may be the case and it's going to be hard for a while it's important to stay the course. Historically, equities have rebounded. Sometimes they take a lot longer. We're going to talk about where the futures are, where the markets are, what's the news this morning?
Keith Lanton:But I want to back up to how we got where we are, and I think it's important to be a student of history. Last week in Barron's there was an article from Philip Toews, founder of Toews Asset Management, and he talked about behavioral portfolios and investor behavior when times are tumultuous, and he made what I think is some great points is that and we've talked about this before is recency bias, and recency bias doesn't necessarily mean something that happened in the last week or two or even year or five years or 10 years. We, as humans, tend to have recency bias especially powerful based on our lifetimes, what has happened in our lifetime, even though there's tons of history books, lots of financial courses and smart people have gone to business schools, law schools and they've read about history, but humans tend to discount events that didn't take a place in their lifetime, and that's perhaps why we hear this phrase that history doesn't repeat. But it rhymes because a lot of things that happened before happened in some version in the future, and it usually happens in the future on a grand scale, once most of the people who were alive during that period are no longer alive. Well, that's when it tends to happen again, because the folks who are alive now they don't have the collective memory of that experience.
Keith Lanton:And we just went through one of those events. So we just went through COVID, which was certainly a major change to all of our lives. A big pandemic, terrifying, certainly caused upheaval in the markets, but it was a big shock to us. We had never experienced anything like that and didn't think that anything like that would ever happen again. But folks who lived through the 1920 influenza epidemic, 1918, 1919, 1920 epidemic, well to them they probably wouldn't have been so shocked that there was a pandemic taking place. So folks who lived through the plague or all sorts of the pandemics that have happened throughout history, they would have recognized that this was much more of a possibility than we did, even though it was only 100 plus years ago.
Keith Lanton:It wasn't in the lifetime of largely since the 1930s, because the smooth tally tariffs that were put into place in the 1930s were largely viewed as exacerbating the Great Depression and therefore the mindset of most economists and market participants and even everyday investors was that tariffs are something that you got to be real careful with. Tariffs are something that can really slow down economies and world trade. And here we are, 95 years later, with significant tariffs and we will see what the implications are of these significant tariffs. But here we are in a period where we are once again doing something that took place in the past. Perhaps something like this hasn't taken place is my point in the last 95 years, because the folks who were alive then it was such a painful memory. Those folks would not have pursued this path and hopefully we will have a very different outlook. Hopefully, president Trump and his team have a plan and they are using this strategy as a negotiating tactic, but we will see exactly what the implications are of these tariffs.
Keith Lanton:To summarize what is taking place with the tariffs, so that there's been so much news, so much rapid-fire events, that it's important to take a look and see, hey, what is going on with tariffs? And just as a quick summary, president Trump announced a universal baseline tariff of 10% on all imports into the United States, and he did that by employing emergency powers the same emergency powers he used to pass tariffs on Canada and Mexico. Some are suggesting that these could be legally vulnerable, given that they were done in an extraordinary fashion. Relative to the statute, that gives the president the power to put these tariffs into place. So it is possible we could see this challenged in the courts Also. Congress certainly has the power to issue tariffs and to restrain the president from using tariffs. At the moment, my opinion is it's unlikely that this Congress will restrain this president, given the number of votes needed. But you are starting to see some Republican senators start to have reservations.
Keith Lanton:So for those countries in whom the US has large trade deficits, the tariffs are significantly higher than the reciprocal tariff. They are the baseline number of 10 percent. The EU is going to be looking at tariffs of 20%, vietnam 46%, japan 24%, india 26% and, of course, china experiencing tariffs of an additional 34%. That's on top of the 20%. That's on top of the tariffs that were put in place in the first Trump administration that the Biden administration left intact. So you're looking at at least 54% tariffs.
Keith Lanton:If you're looking at goods coming in from China, it's also possible that we could be seeing some more tariffs on things like pharmaceuticals, copper and semiconductors. At the moment, those are exempted For products that were already tariffed, like autos, aluminum exempted For products that were already tariffed, like autos, aluminum and steel. For now there are no additional tariffs on those products other than the ones that were put in place and, significantly, there will be no reciprocal tariffs imposed on Canada and Mexico in addition to the 25% tariffs that were announced on March 4th. Further, the carve-out for the US-Mexico-Canada agreement for goods that were compliant with that agreement, which is about 50% of the trade between US and Mexico, that carve-out for not having tariffs will remain in place. The executive order also says that there's progress made on the border and on fentanyl. Is that there's progress made on the border and on fentanyl that tariffs between the US and Mexico and Canada could be reduced to 12% from 25%?
Keith Lanton:There President Trump did open the door to negotiations and to deals. Perhaps that's the one thing giving the markets some ballast is that folks are hesitant to pull the ripcord because the expectation that, or the possibility, I guess, depending on your perspective that there could be some measure of dealmaking going on. White House Director of National Economic Council, kevin Hassett, this morning said that the rhetoric needs to be toned down. We are not heading towards an economic nuclear winter. He quoted Bill Ackman, who was very critical of tariffs and who has been a Trump supporter, but he quoted Bill Ackman saying that some trading partners offered great deals, but then he went on to say only President Trump will decide if the deals are great enough. Futures are recovering a little bit and we'll get to futures in a moment. At the moment, it's looking like in the near term that the only one that has got the power to make amendments to these tariffs is President Trump. It doesn't seem like anyone else is driving the proverbial bus At the moment. President Trump has been maximalist with respect to tariffs and suggesting that the tariffs will remain in place, and he's lining himself up and asking Congress for big tax cuts to offset some of the effects of the tariffs on the economy.
Keith Lanton:Barron's, when talking about the tariffs, said that President Trump is fighting a trade war he can't win. The stock market is the loser, as we all have seen. The stock market is the loser, as we all have seen, and they make a good analogy to the trade war to an actual physical war, saying that this is a war that the United States initiated. And when you start a war, you need to assess your strengths, your goals, you need to be prepared, you need to have your allies lined up and therefore, when you engage in conflict or war, victory can be reached with the right result by that extreme preparation. But when poorly planned strengths turn into weakness, quick victories become battles of attrition and unintended consequences can last for years. The worst defeats come from when a country overestimates its own strengths and its opponents' weaknesses and finds itself overstretched and outmatched. Trade war isn't much different.
Keith Lanton:Targeting a country for unpracticed practices in a unified front with allies perhaps makes a lot of sense, and the Tatarists placed on China during President Trump's first term, though imperfect, to fall into that category, barron says. But they say Liberation Day was akin to launching an attack on everyone all at once. And now here in America we are fighting a trade war on all fronts, while our opponents are fighting the US. And now we are in a situation where the risks outweigh the rewards and the risk for the stock market remains to the downside as long as we are taking on so many countries all at once, including many countries that were, and hopefully still are, our allies. Now many point out that the possibility of negotiations to bring down tariffs and end the selling, even though it's unclear. We haven't gotten any real guidance on what that would look like what would be acceptable to this administration. And what's happening now is when you hurt your allies similar to when you say things to your loved ones and it's hard to fix after you pass a certain point and we're starting to see reactions from our trading partners and our former allies comments from France's President Macron, who has called for a suspending investment in the United States by European companies.
Keith Lanton:Canadian Prime Minister Carney, who has been bashing Trump and recognizing that that is good politics, so you might see a lot more of it. And then, of course, china announced 34% tariffs on the US, causing a stock market already reeling to take another leg lower on Friday, former allies acknowledging that what existed before has ceased to exist. Canada's Carney, who has already matched Trump's tariffs on cars, said 80 years of global US economic leadership is over. While this is a tragedy, he said, it is also the new reality. So what are the markets looking and hoping for at this moment? Looking and hoping for at this moment?
Keith Lanton:I would say that the one possibility at the moment to give this market a jolt, other than President Trump announcing some deals on tariffs, is the Federal Reserve possibly stepping in to lower interest rates and markets pricing in about five interest rate cuts as of this morning, but one trend that I would say with respect to interest rates that is somewhat concerning is what we are seeing is we're seeing short-term interest rates decline significantly on expectations of rate cuts, but we are seeing longer-term rates declined significantly less. In fact, this morning, we are seeing the 10-year treasury yield all the way up to a 4.03%. This is concerning because the expectation, therefore, is either A that investors are expecting tariffs to be inflationary which therefore is concerning, because that means that you may have an environment of stagflation if that were the case and number two, the concern is that perhaps international investors are starting to become a lot more hesitant in buying our debt, and certainly one of the issues we have here in this country is that we've got a lot of it. A lot of that debt is that we've got a lot of it, a lot of that debt. So, therefore, keeping an eye on these treasury yields and keeping an eye on the treasury yield curve is something that investors really want to keep an eye on, because, as we're antagonizing some of our investors, these are the folks who buy US assets. If we antagonize them, well, they may be less likely to buy our assets and ifize them well, they may be less likely to buy our assets. And if they trust us less, they may be less likely to buy our assets. So all eyes are on interest rates and important to watch interest rates.
Keith Lanton:I talked about last week the importance of watching the dollar as well. Interestingly, the dollar has not rallied as much as expected. In fact, in a net effect, the dollar is weaker last week rather than stronger. Of course, that's not against every currency, but as a basket and the dollar is important to watch because normally, when you are improving your trade deficit which you might do if you impose big tariffs you would expect your currency to get stronger because of the fact that you are now having less of a trade deficit. And if you're seeing your currency get weaker, well, that's somewhat indicative of perhaps folks losing confidence in US assets, losing confidence in us as a reserve currency. So this also needs to be watched and monitored. Watch the dollar, watch the 10-year treasury, watch the 30-year Treasury, watch the 30-year Treasury. They may tell you more than the stock market of what's taking place and what's going on going forward.
Keith Lanton:So, circling back to the Fed, last week we had President Trump come out and suggest that it was time for Chairman Powell to come out with a cut on interest rates. He said this would be a perfect time for Fed Chair Patman Powell cut on interest rates. He said this would be a perfect time for Fed Chair Patman Powell to cut interest rates. He said that on Friday. Moments later, chairman Powell spoke to a group of financial journalists and said it feels we don't need to be in a hurry to change policy. And then one of the folks in the audience said really? And he then went on to say you have inflation that's going to be moving up and growth that is going to be slowing. It's not clear at this time what the appropriate path of monetary policy will be. We will see in a little while you know, in a little while, meaning over the course of the next week or two whether Chairman Powell blinks and, in the face of lots of concerns about the economy, if he cuts interest rates. We are seeing a tremendous uptick in terms of economists predicting a recession. Jp Morgan this morning out suggesting there's a 60% chance of recession, goldman Sachs suggesting there's a 60% chance of recession and they said if retaliatory tariffs go into effect on reciprocal tariffs, go into effect on Wednesday. They think there is a 100% chance that the US will enter recession At the moment.
Keith Lanton:If you kind of take a look at the tariffs that were announced and you look at them in the whole, the tariff rate in the United States, if these tariffs were to be fully implemented, would be somewhere in the neighborhood of 20 to 25 percent. If you want a rule of thumb, just very rough rule of thumb, what does that mean to the US economy In general? For every 1 percent increase in the rate of a tariff, you're going to get a 0.1 percent increase in inflation tariff. You're going to get a 0.1% increase in inflation and you're going to get a negative one-tenth of a percent decrease in US GDP. So if you were to implement a 25% across-the-board tariff, which is the average here, you would expect GDP to fall about 2.5% and you would expect inflation to pick up by about 2.5%. And this is some of the machinations and some of the things that Chairman Powell has to contend with as he decides what to do. He has no easy task in front of him and certainly a lot of challenges.
Keith Lanton:Speaking White House trade advisor Pete Navarro said to CNBC that it means nothing to the administration of Vietnam offers to lower their tariffs to 0% because of their non-tariff barriers and dumping practices. He's saying the countries want to negotiate, they need to talk about non-tariff barriers. So seeing some more tough talk there from the administration to a country that made a gesture, he's suggesting that gesture is insufficient and perhaps this commentary here throughout the morning is just going to add to the ups and downs that we see in futures and interest rates this morning. So, taking a look at a couple of news items this morning we can't cover them all, it's just too much. President Trump, perhaps in his biggest soundbite of the morning, saying that sweeping tariffs are something that the US is going to have to treat like medicine. In order to make us better, we've got to take this medicine, meaning tolerate lower markets.
Keith Lanton:One of the concerns with the lower markets is that hedge funds, by their nature, many of them, are leveraged, and if you have a leveraged portfolio, if you're invested on margin, well then in a sell-off like this that's happened so fast and so fierce, we could start seeing margin calls and some of the hedge funds reports are liquidating and liquidating strongly here in the United States to take leverage off the table. So if you are 30%, 40% leveraged. You've got to sell 20% 25% of your portfolio in order to drive that leverage down to a tolerable level, or perhaps even more if you want to completely eliminate leverage. And lots of talk this morning that that's what's been taking place over the last few days and that there is more to come. So let's take a look at the futures here.
Keith Lanton:Moving target Dow futures kind of in between at worst and best levels in the morning. Dow futures are down about 930 points. S&p futures down 133 points. Nasdaq futures right now down. Let's track here. Nasdaq futures down about 517 points. What's interesting right now? I can't even tell you why at the moment, but the 10-year treasury is up six basis points to a 4.05. Seeing oil lower down $1.63. Last week, opec actually increasing production of oil, so that, on top of the fact that the world economy is expected to slow, has been driving oil prices down significantly. This morning we are seeing weakness in gold and that perhaps could be attributed to the fact that folks are selling assets, not only the assets that are the volatile ones, but they are now reaching into assets that have held up better in order to take leverage off the table. And you're starting to see that in some of the more stable US stocks as well, starting to see some weakness Overseas.
Keith Lanton:Japan's Nikkei 225 average slid into a bear market. If you're taking a look at China, chinese shares in Hong Kong were down 14%, putting it into a bear market. The Hang Seng market had its biggest drop since 1997, wiping out all of its gains for the year. Merging Markets Index dropping 7.9% and raising its gain for the year Biggest intraday drop since 2008. Cryptocurrencies, wiping out almost all their gains since President Trump was elected in November. At one point Bitcoin was down below $75,000 for the first time since November 7th. Before pairing that drop, tesla shares down about 4.5% pre-market trading. This would bring the level of Tesla down to a level that Commerce Secretary Howard Lutnick proclaimed it would never be this cheap again.
Keith Lanton:Magnificent 7 stocks sliding anew amid a broad sell-off as the trade war plays out NVIDIA down about 7%. Amazon 5%. Meta down about 6%. Apple 4%. Microsoft 4%. Alphabet also down about 4%. This morning News on Apple a story that they may increase their phone prices in the US. It will certainly contribute to inflation. That's according to Bloomberg. They're also saying they're going to keep their TikTok application. Keep TikTok their app on the App Store getting reassurances from the administration that they won't be penalized for doing that.
Keith Lanton:Taking a look at markets in Europe we're seeing markets down anywhere between four to five percent pretty much across the board. Wall Street Journal reporting and we talked about this just briefly before that lawsuits are expected to challenge in courts the president's tariff authority. India said that they are unlikely to retaliate. Unlikely India to retaliate against US tariffs. Taiwan and Indonesia ruled out countermeasures, but the EU is preparing a list of countermeasures. Some are speculating that if the EU were to retaliate that would lead to another leg down here in the US. People waiting sort of on tender hooks with respect to what the EU is possibly going to do in the near term. Chinese Prime Minister saying he wants to visit the US to discuss a trade deal. China's talking about speeding up stimulus to counter tariffs.
Keith Lanton:Over the weekend, president Trump's cabinet dismissed recession fears and downplayed the market sell-off, saying 50 countries had called for negotiations. Over the weekend, elon Musk said he hopes the US and Europe will eliminate all tariffs. He also came out and suggested that the White House tariff advisor and economist, peter Navarro and I'll say this nicely doesn't know what he's doing. So interesting to see a little bit of a crack in the unanimity coming from the Trump team. We had a Democratic representative, don Baker, introduce a bill to remove the presidential tariff authority, but Speaker Johnson said there's no plans to bring that up for a vote. Jim Cramer on CNBC says he doesn't advise people to bottom fish in the stock market today because he thinks that Europe will retaliate. So what do we got going on this week?
Keith Lanton:Well, there's lots of earnings news but I'm not going to focus on that too much because that's going to be viewed as rearview mirror stuff. Perhaps more important than what the earnings are is what the companies that report earnings have to say about the future going forward, what they think their business prospects will be. So three weeks ago, two weeks ago, we'd be talking about earnings. We'd be talking about the employment report that came out on Friday and how it was a good number and how that was something that was a real positive for the economy. But the tariffs are this massive event that's just taking the spotlight away from all the other events, and these other events now really don't mean much because everything is predicated on what's taken place going forward, not the past. On Wednesday we do get the minutes from the last Federal Reserve policy meeting, so we'll get some insights into what they thought before, some earnings this week. It'll be interesting to hear what Delta Airlines has to say on Wednesday, not so much about the current environment but what they see going forward. Also Constellation Brands, which imports lots of beverages from Mexico, some of the Mexican beers, to see what they're seeing. Stz as well. And then on Friday we get consumer sentiment certainly be something that the folks will keep their eyes on to see what effect all of this turmoil is having on the psyche of individuals. And then we get the earnings from the banks and the financial services companies really coming big on Friday JP Morgan, blackrock, wells Fargo, bank of New York, morgan Stanley. So to get their input on what they see at the moment and, more importantly, what they see going forward will be very telling. So last week at the end of the week the Dow was down 9.3%. On Thursday and Friday S&P fell 9.1% last week, biggest drop since March of 2020. S&p is down about 17% from its highs. If you're wondering where our bear market is on the S&P 500, down 20% would be 49.15. At the moment, the S&P futures indicate the S&P will open about 5,000. So S&P at the moment staying out of bear market territory, at least for the moment.
Keith Lanton:Investors need to take President Trump seriously Before they were taking him seriously, but not literally. I would say that at the moment what President Trump has said is what he's been doing. Lots of folks thought take President Trump seriously on tariffs, but don't necessarily take him literally on everything he says. That's kind of what we learned in his first term that he makes all sorts of bold, brash proclamations, but that's not necessarily what gets implemented. So far, with respect to tariffs, markets are starting to think that what he's saying may actually happen. Tariffs markets are starting to think that what he's saying may actually happen. We'll see how things play out, of course, over the next week or two, but at the moment, and based on comments that we've gotten in the last 24 to 48 hours, indicates that at the moment it's full steam forward going ahead. Barron's cover story was on the tariffs why the tariff damage can't be undone, basically suggesting that the genie's out of the bottle.
Keith Lanton:Once you've antagonized so many different folks, you can't quite get back to home, so to speak, and perhaps the biggest concern is the shake in the consumer confidence, the shake of confidence in the wealthy, who are the biggest drivers of consumer spending, and that damage can't be easily undone. So where to look? We talked about at the beginning of the call. If you're not comfortable with another 10% decline, well, get yourself down to a level where you can sleep at night and then reassess your risk tolerance. What are some of the investments you might want to think about going forward? If you're thinking about making your portfolio a little bit or a lot more risk resistant. Well, of course there's cash, then there's bonds, but we are seeing keep in mind that not all bonds are the same there are spreads widening out in high yield bonds to a significant degree, but there's treasuries.
Keith Lanton:Municipals, investment-grade corporates should give portfolios ballast. Gold, which we've talked about for weeks down this morning but generally has been in a significant uptrend as folks are seeking a safe haven, even a safe haven outside of the dollar, even a safe haven outside of the dollar. And then there are value stocks, especially large cap value stocks here in the US, that pay a dividend, that give you some payment while you are waiting for the world to recover. And then perhaps global diversification, if the thought process is that some other areas of the world are going to be stimulating their economies, perhaps growing their economies more, perhaps catching up to the United States. You know US-centric investment theme has worked for the last decade, even 15 years, but historically, having a worldwide diversified portfolio has proven to be a portfolio that provides positive returns relative to the risk or the variance in your portfolio. So you may want to think about going back to an allocation to international.
Keith Lanton:Finally, barron's did talk about Apple, saying that Apple has no place to hide. Tariffs on China are just one part of their problem. The other part of their problem that Barronron talks about is that there may be some sort of digital tax imposed more broadly, especially in the EU, but that may be a measure or way for some of our trading partners to strike back at us in a way that could potentially hurt us and our companies that do business over there. Apple, so they're suggesting it's amongst the most susceptible. So, to put in perspective, we have a they're suggesting is amongst the most susceptible. So, to put in perspective, we have a $1.2 trillion goods trade deficit, but we do have a $300 billion services surplus, and that services surplus a lot of that services surplus are the technology companies like Apple, microsoft, meta and Alphabet, and those companies may be on the receiving end of some retaliatory actions.
Keith Lanton:Of course, we'll see, we will evaluate what we learned today and this week and we will regroup next week and keep stress testing our theses and keep hopefully improving our thinking so that we can have successful investment outcomes, keeping our minds clear and rational as much as possible. Get yourself to the point where you can think clearly, because if you can't think clearly, you're going to act irrationally and that's never going to have a good consequence in the long run. So wishing everyone a great week and hopefully a clear head and opportunity to reassess and hopefully take advantage of some of the disruption that's taken place. That's everything I've got.
Alan Eppers:Thank you for listening to Mr Keith Lanton. This podcast is available on most platforms, including Apple Podcasts, Spotify and Pandora. For more information, please visit our website at www. heraldlantern. com.
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